Escrow extended 30 days

As anticipated, the Lottery Commission voted to amend yesterday a $30-million escrow agreement to extend it by 30 days from Aug. 1 so that they will be able to continue working on sticky issues in the ongoing negotiations with Best Sunshine International Ltd. on a Saipan casino development agreement.

The locations of the hotels with a total of at least 2,000 rooms and the number of casinos on Saipan are among the issues that have yet to be ironed out.

The escrow deal extension means the $30 million will not be released back to Best Sunshine today, and will remain with the bank up to Sept. 1 or earlier, depending on how soon the parties come to a casino agreement that will bind the CNMI for up to 40 years.

The 3-0 vote to amend the escrow agreement involving Best Sunshine’s $30-million deposit came at 5:12pm, following a two-hour executive session.

The $30 million, once released from the bank after an exclusive casino license is awarded, will be used to fund retirees’ deferred 25-percent pension and interest on defined benefit members’ withdrawn contributions.

“It’s not really about a delay in retirees’ pension payment but this extension is to make sure that they will have the 25-percent pension,” Lottery Commission chair Sixto Igisomar told Saipan Tribune.

Besides Igisomar, the two other commissioners who voted to amend the escrow deal were Public Safety Commissioner James Deleon Guerrero and Finance Secretary Larrisa Larson.

A fourth commissioner, acting attorney general Gil Birnbrich was off-island. Counsel Jim Stump was also at the meeting that wrapped up at 5:22pm.

“The bottom line is, we’re not able to make a decision [Thursday or Friday]. Instead of extending the escrow agreement every time we’re not ready, we decided to just extend it by 30 days,” Igisomar said, adding that the goal is to decide as soon as all the outstanding issues are addressed without waiting for the one-month extension to expire.

An agreement could be inked as early as late next week.

Deleon Guerrero, during the commission meeting on Capital Hill, addressed what he described as the anxiousness of community members who are either for or against casino.

He said he would rather see a carefully crafted agreement “that is in the best interest of the entire Commonwealth” rather than rush its signing, considering that it will be as 40-year agreement.

An exclusive casino license would be for 25 years, with an option to extend for another 15 years, for a total of 40 years.

“We want to make sure whatever it is we are able to come to final agreement is truly something that will give us the best economic opportunity as well as [provide] safeguard to make sure this will be a good agreement for the government and the entire people of the Commonwealth,” Deleon Guerrero said.

The Lottery Commission also adopted a motion allowing Igisomar to move ahead with the hiring of administrative assistance to prepare all the records and documents related to the commission’s decisions and activities, and hiring of counsel “if need be” to assist Stump. Moreover, the Office of the Attorney General’s chief of Civil Division, Reena Patel, is currently off-island.

Stump said the negotiation is a “continuing, evolving process” with refinements made almost every single day.

“I think we are very close to agreement. We are receiving daily inquiries from people who are anxious for this to come to closure and therefore we need to move expeditiously but because it is a very complex, long-term agreement, we’ve got to make sure that all the issues are properly addressed,” Stump said at the meeting.

Terence Tay, Best Sunshine’s chief operating officer, said he also needs more time to consult with their headquarters in Hong Kong about the provisions of the draft casino development agreement.

Tay, in an interview outside the commission meeting place during executive session, reiterated that land has always been an issue.

Considering that there are limited beachfront properties available on Saipan, Best Sunshine has to take a look at different locations where they can build integrated resorts.

It was learned that Best Sunshine could build in the northern and southern part of Saipan, as well as in central Garapan, all beachfront areas.

Tay said it takes time to come up with a development agreement “but we are a lot closer now than one week ago.”

Gov. Eloy S. Inos, in a separate interview yesterday, said he would support an extension of the escrow agreement “to resolve whatever remaining issues they have during the negotiation.”

“But there are other things that are tied in to the release of the escrow funds—the payments to the retirees. …I actually would urge the commission to try to expedite the negotiations so that we can wrap this up and get an agreement going, and release the funds so that we can get the disbursement going,” he said.

Once the minimum $2 billion casino development agreement is signed, it would be the biggest in the CNMI in decades, although legalizing casino operation on Saipan remains a contentious issue.