Minority leader Rep. Edwin K. Propst (Ind-Saipan) and Rep. Tina Sablan (Ind-Saipan) again voiced concerns over the inability of Imperial Pacific International (CNMI) LLC in meeting its obligations to the CNMI government. Both legislators are asking their colleagues in the House of Representatives, particularly the Gaming Committee, to hold an oversight hearing on IPI.
Citing an audit report by accounting firm Ernst & Young on the financial statements of IPI for 2017 and 2018, Propst is hoping that the Commonwealth Casino Commission, which has oversight powers over the casino, would release more information on IPI’s finances using the Open Government Act in obtaining the data.
IPI, however, obtained a temporary restraining order from the CNMI Superior Court yesterday and is seeking a preliminary injunction to prevent the commission from releasing the tax information, insisting they are confidential.
“On June 13, 2019, the CCC notified IPI that an [OGA] request was received seeking information concerning IPI’s audit financial statements by Ernst & Young, business gross revenue tax payments and corporate income taxes,” IPI said in a statement. “CCC further notified IPI that an [CNMI] Attorney General opinion was received, which concluded that CCC could disclose the information sought in the OGA request. However, it could not provide IPI a copy of the AG opinion because it was confidential.”
IPI now wants the Superior Court to prevent CCC from releasing the information, citing sections of the CNMI Constitution and statutory rights to privacy as legal basis.
“IPI is put between a rock and a hard place; we want a good working relationship with our regulator, CCC, yet, as is expected of IPI, we must follow all laws, like everyone else. All we are doing is asking the court to enforce the laws that say that a person has a protected right to privacy with their tax and other sensitive company information,” said the IPI statement. “IPI reports all our financial information to the CCC on a monthly basis. In fact, we always report more than what is required. There are certain information that are public record and those that are not. The OGA request to CCC is seeking confidential information pertaining to IPI. We reserve the right to keep them confidential.”
IPI legal counsel Viola Alepuyo said local laws and the CNMI Constitution protect confidential and other sensitive information. “Therefore, IPI is taking steps in exercising its constitutional privacy rights and seek by requesting the [Superior] Court to grant IPI’s request to stop CCC from releasing confidential information relative to IPI.”
Speaking in yesterday’s House session, Propst again accused IPI of not meeting its obligations to the CNMI government.
“In a time that we’re cutting salaries and hours, we have a casino that is failing to do their share in paying taxes. …I have talked to a small business owner who is upset after learning of the report. Why does [a small business owner] having to struggle to survive and keep their business afloat, have to pay [their] monthly [business gross revenue tax], when we have a casino that made grandiose promises and they are not fulfilling it?”
He added IPI, which operates the casino that was supposed to bring in revenues, is not delivering what it had promised.
“The sad thing about this is that no one is discussing it. In the administration, nothing. They are defending the indefensible,” said Propst, who also accused the media of not reporting on IPI not fulfilling its obligations to the government.
“We have to cut our government workers their hours, especially those who are struggling, and small business owners who are barely making ends meet but still making it possible to pay their taxes, and we have this,” he added.
Propst urged the House Gaming Committee, of which he is a member, to consider his request.
Sablan, who is also a vocal critic of IPI and its casino, said the company has failed to meet its obligations under the Casino License Agreement, especially regarding the Community Benefit Fund.
“There seems to be no accountability and the [CNMI] Lottery Commission had, instead, granted pretty much every request that IPI has asked for. I think this [is] one more reason for oversight and financial investigation by this body,” said Sablan.