Marianas Public Land Trust board treasurer Vianney B. Hocog has asked board chair Martin B. Ada to let the MPLT’s investment committee to look into the request of the government to create a line of credit with their agency.
Hocog, who also sought the assistance of MPLT financial consultant Bruce MacMillan, heads the investment committee.
Hocog said he wants himself and MacMillan to prepare a report that they would present to the full board at their next meeting. The board will be meeting again next week with MPLT trustees Maria Frica T. Pangelinan and Pedro R. Deleon Guerrero.
Only Ada, Hocog, and Peter Q. Cruz were present at their meeting last Tuesday at the MPLT conference room where they discussed Gov. Ralph DLG Torres’ letter. The government is asking for a $15 million line of credit with MPLT to secure funds to pay its bond obligations and the Settlement Fund.
House Speaker Blas Jonathan T. Attao (R-Saipan) has already introduced House Bill 21-44 to authorize the MPLT line of credit.
Right now, Hocog believes it is a good idea to accept the government’s request, saying it would be a guaranteed fix to the CNMI’s current financial fix.
“The opportunity is here and this could be long term. We have the opportunity to study this further and know what would the repayment schedule would be,” he said. “This is the purpose of MPLT, to help the Commonwealth in times like this. Now, how do we approach this? Give us a day or two, so that we can study this and we can recommend it to the board. Give us the responsibility to put up a financial scheme and matrix.”
MacMillan agrees with the board that they should exercise their due diligence. “The initial hurdle, as you said, is for the Department of Public Land to transfer $10.9 million to MPLT…,” he said. “Once we have that funding, then we can consider the other aspects of evaluating the proposal as to the remaining funding that would be required to get the desired amount being requested by the governor.”
MacMillan added that MPLT investment consultant would also be involved “because we would have to sell some investments and would have to consider the effect on our assets allocation and make changes to the investment policy statement.
“All of those factors are part of the due diligence process but everyone is in agreement that the major funding source for this is DPL’s [remittance] of $10.975 million that, we feel strongly, is owed to us,” added MacMillan.
The $10.9 million in funds from DPL are revenues from public land leases, which the Office of the CNMI Attorney General had said has to be transferred to MPLT. “Those…are public land funds that must be transferred to MPLT. DPL’s continued retention of the funds constitutes a violation of the [DPL] secretary’s fiduciary duties which may likely subject the secretary to personal liability,” said the OAG’s conclusion in a report last October.