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Lottery Commission amends casino license agreement, again

THE Lottery Commission made a fifth amendment to the casino license agreement on Monday to extend the deadline for the completion of Phase One of Imperial Pacific International’s project in Garapan and Phase Two which is a hotel project in Marpi, and to secure an annual contribution of $20 million to the Community Benefit Fund.

During a meeting, the Lottery Commission, IPI and the Office of the Attorney General agreed that the deadline for the completion of IPI’s Garapan project would be Aug. 13, 2023 while Phase Two’s deadline would be Aug. 13, 2028.

Moreover, IPI agreed to pay an annual fee of $20 million.

IPI will pay an advance of $20 million in 2018. The first $10 million will be paid on Jan. 1, 2018 and the remaining $10 million on June 1, 2018. Then IPI will make an annual contribution of $20 million to the Community Benefit Fund for every year of the license agreement starting Oct. 1, 2019.

The Community Benefit Fund is for community programs, education, scholarships, infrastructure, healthcare and employee retirement benefits.

In a statement on Tuesday, Gov. Ralph Torres said the Community Benefit Fund is an important element of the licensee’s development-proposal requirements.

He said the Lottery Commission’s decision to extend the deadline for Phase One and Phase Two of the project is also in line with his administration’s goal of sustainable development.

“Extending the deadline for the completion of Phases One and Two allows the government to properly and efficiently build the necessary infrastructure to accommodate the new amenities and resources that will be available for both tourists and our community to use and enjoy. From the very beginning of this new venture, our main goal has been to properly balance the needs of a growing economy and our unique environmental resources,” Torres said in a statement.

The extended deadlines will likewise allow IPI to properly go through the permitting process, so that there is “more efficient enforcement and no cutting corners,” he added.

“At the end of the day, it is important that we ensure the success of IPI so that we can continue to grow our economy sustainably and foster a market where new small businesses can pop up and new industries can add to our community’s economic success.”

To date, the governor said, the Community Benefit Fund has provided $10 million in the form of Commonwealth Utility Corp. vouchers which helped keep rates low and affordable for CUC ratepayers.

Torres underscored the significance of ensuring that the annual contributions to the Community Benefit Fund remained in line even though Phase One of project is not yet completed.

“In the Lottery Commission’s process of amending the [casino license agreement], the Community Benefit Fund was an element where we took a firm stance. We are very pleased that we were able to secure a guarantee of an annual contribution of $20 million to the fund, so that we can address not only the government’s longstanding obligations, but also fund infrastructure projects, address our utility needs, provide for better healthcare services, more educational resources for [the Public School System, Northern Marianas College] and our vocational institutions, and continue to pay our retirees their benefits.”

The $20 million annual contribution to the Community Benefit Fund is additional guaranteed revenue for the commonwealth aside from the casino license fee of $15 million and the casino BGRT.

On Tuesday afternoon, the Commonwealth Casino Commission conducted a brief presentation before the Senate Committee on Gaming.

In an interview, Chairman Juan Sablan said the decision to amend the casino license agreement to extend the deadline for the completion of Phase One and Phase Two of the project and to secure a guaranteed revenue is a win-win situation for both IPI and the commonwealth.

“It’s a substantial amount of money, the $20 million in addition to the $15 million license fee and the BGRT. It can address many issues. Next year, we’ll have the money, upfront money, instead of waiting for the completion of Phase One first. There is already money coming in so that’s a good development.

“Of course we understand the reasons for the delay in the project. There are issues related to labor, construction, and the CW program, so this amendment is good for IPI. They can have ample time to finish the project, and is also good for the commonwealth as we will have guaranteed revenue even if the project is not yet complete.”

Source: Marianas Variety : http://www.mvariety.com/cnmi/cnmi-news/local/97380-lottery-commission-amends-casino-license-agreement-again

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