Commonwealth Development Authority executive director Manuel Sablan assured last week that they are “very well protected” when it comes to their loan to Freedom Air.
The outstanding debt plus interest Freedom Air owes sits at some $1.3 million right now, according to CDA.
“We are very well protected,” Sablan said. “The only reason why we allowed this thing to go through is because the company continues to maintain a validity of the certificate, the FAA certificate to fly, and that’s a very valuable thing.”
“We wanted basically to explore any possibility that the company can continue to fly, because that would be an economic benefit to the CNMI. And that’s really the reason why we provided the loan, to further encourage them to continue servicing. But if they fall a part, then there it is. We lost a company that has been providing services for the last 37 years,” he explained.
Sablan’s comments come amid a Federal Aviation Administration plan to revoke Freedom Air’s air carrier certificate. This is an amended proposal to one last year in May. The FAA indicated over the weekend, though, that the airline would appeal the revocation.
CDA has been communicating with owner Joaquin Flores on a regular basis, said Sablan, adding that it would be a “sad situation” if the airline collapses.
In this case, though, he assured CDA was protected. “We have the security, we’ll go after the assets—both assets in the Guam Airport Authority premises and also on our site, [as well as] properties that the owner has on Guam and also here,” he said.
“These people have been operating the last 37 years, and they’ve never come to CDA for a loan until they got into this bind,” he said. “They’ve been providing services to Rota and Tinian, particularly medical referrals. Our main objective here is if it can be resuscitated and brought back for operations, it would work for the benefit of everybody, particularly in our quest for more tourism development. But that’s the scenario,” he said.