Marianas Public Land Trust chair Martin B. Ada believes they have enough time to decide whether to grant or deny the Torres administration’s request for a line of credit with MPLT.
During yesterday’s MPLT board meeting on Capital Hill, Ada said the some of the trustees met with Gov. Ralph DLG Torres to discuss the details of the planned line of credit.
“The governor laid down the issue why they need $15 million. That’s the gist of the meeting. We are in a financial crisis, so they [government] need the money,” he said.
House Speaker Blas Jonathan T. Attao (R-Saipan) has already introduced House Bill 21-44 to authorize the MPLT line of credit and help the government address its bond obligations and payment to the NMI Settlement Fund.
In a letter to Ada, Torres said that Attao’s bill would establish a line of credit between the CNMI government and MPLT. The governor asked MPLT to grant them a $15-million line of credit that will coursed through the Department of Finance with an interest rate of not less than 5 percent per annum.
“The passage of H.B 21-44 will allow the Commonwealth through [Finance] to enter into a credit facility in the form of a line of credit with MPLT. This line of credit will ensure that adequate funds exist at the disposal of [Finance] for purposes of paying debt such as bond obligations and [NMI] Retirement Fund settlement payments,” Torres said. “H.B. 21-44 pledges the fund which MPLT would distribute as interest income to the Commonwealth’s general fund…as security for MPLT’s issuance of a $15 million line of credit. Further, the legislation empowers MPLT to withhold interest income for debt service of principal and interest starting in fiscal year 2020 in the event that the [DoF] does not fully repay the loan.”
Ada said that MPLT will still need to discuss the the governor’s letter and request.
“I don’t think that we can make a decision right there and then. …The process takes more than that. We got the opinion of two other trustees on the letter of request and all the issues surrounding the investment fund—the MPLT fund.”
Ada said they would wait for the opinion of trustees Pedro R. Deleon Guerrero and Maria Frica T. Pangelinan before the board makes a decision. Both are currently off-island and are scheduled to return this weekend. He then called for another meeting next Wednesday so they could further discuss the issue as an entire board.
Peter Q. Cruz (Tinian) and Vianney B. Hocog (Rota) are the other MPLT trustees.
Acting Finance secretary David Atalig said in last week’s public hearing for his confirmation at the Senate that cash needs to be infused to the CNMI government in order to meet the bond obligation payment of $4.2 million that is due today and about $2.9 million for the Settlement Fund due yesterday.
Atalig, in an email to Saipan Tribune, reiterated the need for the government to meet its obligations. The process is being stalled, however, by a delay in the release of Federal Emergency Management Agency reimbursements to the CNMI.
“I was able to meet the Settlement Fund Stipulated Agreement today [April 30] and the CNMI government is in full compliance to the Stipulated Agreement for our arrears from the second quarter and current with our weekly payments to the Fund for April,” said Atalig.
“As for the bond obligation, we are in communication with the bond trustee and we are scheduled to make our bond payment by May 10 without penalty or without jeopardizing our current [credit rating].”
Ada said they still have a two-month window. “” I’m pretty sure things will be better but it depends on the other agencies that are involved in this as part of the of the issue that we are pursuing. Especially, the remittance.”
He added the Department of Public Lands has yet to transfer over $10 million to MPLT as revenues from public land leases. “But, like I said, once DPL remits that $10.9 million, then we will call for another meeting and continue with this letter of request whether to grant or not the $15 million.”
“I cannot speak for the other trustees. I am just saying that we will discuss it and take it one step at a time from there. Once the remittance is here, then we will move forward from there,” Ada added,
Ada said the CNMI Office of the Attorney General supported MPLT and instructed DPL to remit the money. He added that the last time he talked to acting DPL secretary Marianne C. Teregeyo was about four months ago.
“The last time that she [Teregeyo] said that she’ll meet with the AG regarding that opinion, that’s about three or four months ago. We had a meeting at her office,” he said.