Rep. Joseph Leepan T. Guerrero (R-Saipan) believes the shutdown of Mariana Resort & Spa and its facilities could have been avoided had the government been more proactive and aggressive in its negotiation with Kan Pacific Saipan Ltd.
Guerrero, the House Commerce and Tourism chairman, said the CNMI government is at the losing end of the closure of Mariana Resort and its surrounding facilities.
“We should be mindful that it is not only the employees that are going to be affected. The business gross revenue tax and hotel occupancy tax are also affected. When you shut down a facility like a hotel resort, there’s no money coming in,” said Guerrero. “So, I don’t know how much dollar amount would that impact in the next fiscal year budget. With the absence of the operations of this resort, nobody knows when it is going to open again.”
The 55,000-square meter property, previously leased by Kan Pacific, is being broken up, with separate requests for proposal for the Mariana Resort & Spa, Marianas Country Club, and its Olympic-size swimming pool.
Guerrero said the Department of Public Lands must expedite the process so the property won’t turn into another La Fiesta. “I say that this is going to turn into another La Fiesta. For one, we should have planned this way ahead of time before it shut down.”
“Why are we waiting up to the end of the lease agreement to be always rushing in trying to fix this? As to the reference that it won’t be another La Fiesta, I say it is going to be another La Fiesta if DPL does not move expeditiously.”
He said DPL Secretary Marianne Teregeyo has the final say in her department. “I think the DPL secretary should be mindful that she makes the decisions. Not the lawyer or the [Attorney General] that represents the DPL. She should listen to herself on what is the best interest. The counsel is just there to guide you forward. That’s why you are placed in an office to run it, because you know how to run and operate it in a business environment. Lawyers are there to guide you.”
Guerrero said the government could have acted proactively on the issue. “To have such a big investment sitting there now while we’re fixing who is going to operate the hotel, golf course, pool…this waiting game should have been taken cared of. I understand the administration is looking at every aspect, but we need to be proactive.”
“Start thinking before the lease agreement expires, put everything in motion, and not only think about the current operator if they are willing to continue. Who is going to be the new investor? What will happen to the employees? You don’t need to wait at the last minute then shut it down and then what?”
Guerrero added the company that would be awarded the property would have to spend more before they re-open the facilities since the property had been abandoned for almost two weeks now.
“Right now, they have to prepare separate concession agreements for the hotel, golf, and pool. I think that DPL needs to fast track this. If a facility shuts down for a few days, weeks, months, or years, obviously all of this would be costly for the new investor because it is sitting idle.”
“You got to spruce up the facility again, since there’s no continuity in maintaining the rooms. Operating a hotel is expensive; that’s why they have housekeeping, grounds crew, and building maintenance just to have somebody to maintain the facilities.”
He said that right now there’s a security management that is at the Mariana Resort property. “I understand that it is just to maintain the facilities and make sure that there’s no vandalism or [stealing] whatever the remaining contents of the hotel.”
“But it’s not cheap. That’s money that’s coming out of DPL. I don’t think that’s paying $500 a month for security. They need to make sure that there’s security in place and maintain the facility.”