CNMI, Governor Gives State of Commonwealth Address

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Inos: Economy ‘recovering,’ ‘much work still remains’

By Haidee V. Eugenio

SAIPAN, CNMI (Saipan Tribune, July 1, 2014) – More than 16 months since his unprecedented rise to power, Gov. Eloy S. Inos reported to the public yesterday that the CNMI economy is "recovering" and could reach $1.3 billion in business activity this year alone, while also pointing at litigation and other objections that kept his administration from restoring retirees’ 25 percent cut.

In his 53-minute, 32-page State of the Commonwealth Address, the governor also spoke about a safer CNMI although "much work still remains," and pointed to improvements in public services and programs such as health, utilities, and education.

"That’s what making it happen is all about," he said at one point, about a $1.3 billion projected economic activity this year—an increase of $200 million from last year.

Throughout his address interspersed with 20 rounds of applause, Inos made no mention of the word "casino," which has become one of his administration’s major revenue-generating measures but has been the subject of litigation and other objections.

"At the moment, we must await the decision of the courts before we can have a concrete date to put your money back in your pockets," he told the crowd at the Pedro P. Tenorio Multi-Purpose Center in Susupe.

Because of the litigation, the Lottery Commission, in their meeting on Capital Hill yesterday afternoon, didn’t announce any decision whether to grant—and to whom—a license to exclusively develop a minimum $2-billion integrated casino resort on Saipan. Instead, the commission prepared for court proceedings related to casino lawsuits this week.

The governor asked for peoples’ patience while "work is still being done."

"No matter how many people try to stop this effort, I will keep fighting to give you your money back," the governor said, drawing applause from the crowd, many of them also retirees waiting for their deferred 25 percent pension since last year.

He said tourism would always be an important industry but that it cannot be the CNMI’s sole economic driver. He pointed out that with the help of the Legislature and the people, they will continue to attract new industries and jobs.

"With all due respect to the lawyers in attendance, we cannot sue our way to prosperity. We must be proactive and seek out potential new investors," Inos said.

The Senate and House of Representatives held a joint session at 10am yesterday to receive the governor’s SOCA, as well as a report from Delegate Gregorio Kilili C. Sablan (Ind-MP).

All nine senators were present, while two of 20 House members were absent: Reps. Christopher Leon Guerrero (Cov-Saipan) and Teresita Santos (R-Rota).

It was Inos’ first SOCA. He became governor on Feb. 20, 2013, when Benigno R. Fitial resigned in the middle of an unprecedented impeachment process. Then-Senate president Jude U. Hofschneider became Inos’ lieutenant governor.

Inos is running for the first time as a governor in a CNMI election this November. He is facing three other gubernatorial candidates.

‘Too fast’

Inos shifted to the U.S. military’s plans for the CNMI, after talking about the recent commemoration of the 70th anniversary of the Battles of Saipan and Tinian and after recognizing the men and women from the CNMI that served and continue to serve the armed forces.

The U.S. military, Inos said, is changing its focus from the Atlantic to the Pacific theater. This, he said, would change the CNMI "into what would be one of the world’s largest military training bases covering land, sea, and air."

"I believe as your governor, these proposed changes are happening too fast," he said. "I believe that we must carefully weigh and consider the proposed military activities planned to take place [on] our islands."

The U.S. military eyes expanding its use of Tinian, and to use Pagan in the Northern Islands for military training, including bombing activities.

Col. Philip J. Zimmerman, officer-in-charge for the U.S. Marine Corps Activity Guam, the ranking military official in attendance at the SOCA yesterday, noted that both the governor and the delegate recognized that environmental impact studies are being conducted in connection with planned military activities in the CNMI.

Inos also reiterated his position that a U.S. Air Force divert airfield should be placed on Tinian rather than Saipan.

‘Collaboration’

The governor also spoke about collaboration in government.

"Today, I’m proud to share with each and every one of you that the State of our Commonwealth is once again experiencing true collaboration between the Executive and Legislative branches as well as our U.S. congressional delegate. This partnership, and with the people standing by our side, has resulted in the Commonwealth experiencing exponential growth," the governor said.

He said as a result of the retirement settlement agreement, the CNMI has shrunk the general fund deficit from $300 million to $70 million.

The CNMI also increased its annual appropriation from a low of $102 million to now $135 million.

Inos also thanked Delegate Sablan for together, they were successful in passing a submerged lands bill, getting renewed assistance from the federal government in helping secure additional funds, and securing a five-year extension of the CW program that allows the CNMI continued access to some 10,000 skilled and professional foreign workers up to 2019.

He also called on government-private sector partnership in fostering "a generation of workers, people with skill, drive and passion," as the CNMI prepares its U.S. workforce for the eventual end of the foreign worker program in five years.

The governor reported on funding for education that meets federal requirements, as well as successful consolidation of agencies without disrupting public services. He also took note of Northern Marianas College’s removal from show-cause status and reaffirmation of its accreditation.

More numbers

In keeping with the theme of an improving CNMI economy, the governor pointed out that the islands have attracted new investors.

The CNMI has issued a little over 800 new business licenses in the past year and a half alone, he said.

At the same time, the CNMI’s bankruptcy rate is the least per capita in the nation, Inos added.

After seeing tourism on the brink of collapse, the governor said the visitor industry is seeing a "significant rebound."

Total visitor arrivals are expected to reach 472,000 this year, nearly a 9-percent increase from last year, citing data from the Marianas Visitors Authority’s managing director Perry Tenorio.

Inos said the CNMI has gone from having too many empty rooms to not having enough rooms to accommodate tourists. He recognized E Land Group for rebranding the former The Palms Resort to the global brand Sheraton, while also acknowledging continued efforts by Hafadai Beach Hotel, Hyatt Regency Saipan, and Mariana Resort, among others.

The governor also thanked long-term and locally-owned businesses like Joeten Enterprises and its group of companies, Herman’s Modern Bakery, Triple J, and Tan Holdings, to name a few.

The governor also spoke of the CNMI and Guam’s collaboration, including addressing trade barriers between the two so that cattle import and export would become a reality this year.

Inos also said the solvency of the Retirement Fund has been extremely touchy, and that he has done "and will continue to do everything possible to ensure that this situation is resolved."

"We still have a long way to go, but a solution has been identified and we are hopeful that we will be able to honor our obligations as quickly as possible," he said.

The governor said 90 percent of residents now have 24-hour water services—an 80-percent increase from just two years ago.

Through Department of Public Works’ staff and federal partners’ aid, the CNMI has obtained and executed more than $11 million in contracts to improve roads and highways within the last 36 months.

In the last 16 months alone, a total of $33 million in capital improvement project funds have been obligated to help improve people’s quality of life.

In the next 90 days, additional obligations of over $20 million will go toward other projects on Saipan, Tinian, and Rota. The governor also spoke about the revitalization of the Carolinian Utt in Garapan.

The governor also said spoke about the lifting of a 1999 consent decree on the Department of Corrections in connection with the prison, as well as rehabilitation of the Saipan airport’s runway. He noted an increase in food stamp assistance for residents needing help.

Toward the end of his address, the governor said, "We have made a whole lot of progress, but much more must be done and our work will not stop to identifying the solutions necessary."

He said together with the lieutenant governor, the delegate, the Senate president, the House speaker and their colleagues, they will continue to build on improving the quality of life in the CNMI.

"We cannot sit idly by, we will not stop our efforts, and we will not change our resolve to make the CNMI more prosperous for all citizens. While we are making significant progress in identifying and enacting solutions, there are many more mountains we have to climb," he added.

CNMI Supreme Court Chief Justice Alexandro Castro, when asked for comment on the SOCA, said he thinks both the governor’s report and the delegate’s report "give us an overall picture, a true picture of our situation in the CNMI and how it relates to Washington."

"And I think the sum total of their message is crystal clear: Elected leaders of the CNMI, please work together to try to overcome those hurdles that lie between us and Washington, D.C.," Castro told Saipan Tribune.

Alex Sablan, president of the Saipan Chamber of Commerce, said the governor provided a "concise overview of the CNMI’s trials, tribulations, and ultimate successes that we can call achieve if we work together."

Senate floor leader Ray Yumul (Ind-Saipan), however, noted that the governor didn’t mention the CNMI’s problems related to interisland transportation; for example, the lack of air service between Rota and Saipan/Guam.

House Speaker Joseph Deleon Guerrero (Ind-Saipan), for his part, thinks the governor’s SOCA is a "fair portrayal of the issues and challenges."

"If you’re expecting dramas, lightning and thunder, it’s not there but it’s not necessarily a bad thing. At least strides are forward motion, which I think has been lacking all these years," he said.

Rep. Ralph Yumul (Ind-Saipan) was expecting more about the CNMI’s financial conditions other than what’s been done.

"I was expecting more about where we needed to be, rather than what we’ve done. One also caught my attention, when the governor said we have to wait for the decision of the court," Yumul said, referring to the casino litigation.

Ramon B. Camacho, chairman of the Saipan Municipal Council, said the governor’s message was "good" when he said elected leaders need to work together. "Set aside politics, because we have pressing issues before us," he added.

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