Senate President Arnold I. Palacios (R-Saipan) said the Senate Committee on Resources, Economic Development, and Programs is still reviewing Senate Bill 20-35 to make sure all comments from various members of the community are taken into consideration.
S.B. 20-35 wants to extend the lease of public lands from 40 years—25 years with up to an extension of 15 years—to 75 years—40 years with up to a 35-year extension, which would generate renewed economic interest in the CNMI from new investors. The bill is with the REDP committee chaired by Sen. Francisco Borja (R-Tinian).
Palacios told Saipan Tribune last Friday that the REDP committee is also looking at the perspective of those who are opposed to the bill especially the Northern Mariana Descent Corp. where they see that a 40-year land lease is enough.
“The committee is looking at the opposition’s perspective. We want to make sure that we take those in consideration. If necessary, answer them or do whatever it is needed to adjust,” said Palacios, who added that the bill remains alive.
“In order for me to shelve that [S.B. 20-35], it has to be filed. It is very much in play and is back to the committee to review all the other concerns and comments. A legislation is not dead until we voted to file it,” Palacios said.
This was contrary to what NMDC president John Oliver Gonzalez told Saipan Tribune, in an earlier interview, that he understands that the bill is dead and will be entertained in the next Legislature. “My understanding now is it was held at the committee and it won’t be entertained after the election and obviously the new Legislature.”
Palacios said S.B. 20-35 is a critical piece of legislation that concerns the CNMI’s tourism industry especially with several hotels with expiring public land leases. It only addresses the land leases. The public land leases for hotels and golf resorts. We have several of these hotels whose public land leases are expiring.”
“These hotels played a major role in the growth of the tourism industry. They continue to be major players in the industry and these hotels are located on public lands. These hotels are some of the biggest that we have.”
Hyatt Regency Saipan is among the hotels that have an expiring lease (December 2021). Hyatt general manager Nick Nishikawa, in a previous interview with the Saipan Tribune, said that they hoping for a lease extension so they could move forward with their plans of improving the hotel’s facilities for the growing number of tourists.
Palacios said the bill’s intent is to avoid any interruption from the tourism industry, which is one of the CNMI’s economic drivers. “We can’t take the chance to interrupt the industry itself. We want to make sure the tourism industry remains stable and in fact sustainable.”
“Having said that, there are parties and individuals, and organizations in our community that have other thoughts. They contributed their thoughts and I respect that. In view of that, what the Senate did is we referred it back to [REDP] committee so that they can review the other positions of some of the members of our community opposing the legislation.”
Gonzalez said they at NMDC felt that the current 40-year lease is enough. “It was from 40 to 99 years and after deliberation, it went down to 75 years. Further talks is at par with the private land leases at 55 years.”
“The NMDC, which advocates for all NMDs, we strongly felt that the current 40-year lease term limit is adequate and the reason being is we do not want public lands to be competing with private lands.”
He said that investors should first look at private lands. “In fact, we encourage the government and investors to first seek leasing private lands. So owners of these private lands could also have that opportunity in the economic windfall. We’re thinking that government lands should be the fallback.”
Gonzalez added that officials should approach the issue as a compelling public policy. “The generation after us ought to be given that opportunity to decide for themselves, the same thing when our [ancestors] decided for us. Time changes so generations change, subsequent generations, we believe, must make that decision.”
“We treated this issue as a paramount concern. It is going to set policy on the future of public land leases. We were invited to participate, and we submitted written comments and testimonies to justify our position.”
Palacios introduced S.B. 20-35 on Mary 22, 2017 and it aims to increase the term of public land leases for up to 40 years plus a 35-year extension for a total of 75 years.
The bill was referred to REDP where the committee referred for its passing and the Senate voted to pass it on Aug. 8, 2017.
It was transmitted to the House where House Speaker Rafael S. Demapan (R-Saipan) referred it to the House Committee on Natural Resources chaired by Rep. Alice S. Igitol (R-Saipan).
The House passed it on June 12, 2018 and went back to the Senate where Borja’s REDP committee is still reviewing all comments—oral and written—made by members of the community.
Saipan Chamber of Commerce president Velma Palacios, Marianas Visitors Authority managing director Chris Concepcion, and Hotel Association of the Northern Mariana Islands chair Gloria Cavanagh were some of those that either submitted their comments or testified in public hearings aside from the NMDC.
Igitol, in the committee report, said S.B. 20-35’s enactment would not result to any cost to the CNMI government. “Because the intent of the bill is to amend 1 CMC 2806 to increase the term of public land leases up to 40 years plus an extension up to 15 years for a total of 55 years.”
“To authorize certain existing public land leases to be amended to extend the existing lease term up to 55 years; [and] to amend 1 CMC 2807 to authorize DPL to negotiate a new public land lease with certain existing public land lessees under new terms and conditions without publishing an RFP.”
“[S.B. 20-35’s] purpose in order to attract new investors and to give them more options for financing with a longer lease term. To authorize certain existing public land leases to be amended to extend the existing lease term up to a total of 55 years for lease properties with and existing hotel or golf course subject to new terms and conditions.”