Due diligence

Does due diligence mean anything to our legislators? I am prompted to ask this question as a fallout of the recent “hurry up and pass” House Bill 16-10 (anticipated 2009 poker fee revenues). How does that work anyway? What happens if the revenues are less than $4.7 million? When and in what order do the funds get released to whom? Are there any requirements or restrictions as to what the monies are spent on? Are all government revenues and expense matched up in such a fashion?

So, back to due diligence. According to Rep. Tina Sablan, this bill was introduced and “railroaded”(please excuse the pun) through the House in a single morning. Exactly what was the level of due diligence in its deliberations? It would seem incumbent upon all elected officials, who are to serve the people of the CNMI, to demonstrate a thoroughness of consideration in all bills brought before them.

Let’s use as an example the $100,000 earmarked for the newly formed Marianas Trades Institute. It just so happens that I attended a public meeting for the new institute that was conceived and funded by Tony Pellegrino. Mr. Pellegrino informed all those in attendance that this was a non-profit organization dedicated to training the much needed tradespersons for the future CNMI economy. He introduced some of the instructors/trainers and laid out his plans for success. Many of you know how positive and supportive Mr. Pellegrino is, and can no doubt imagine that those in attendance were quite excited about a way to create value for themselves, their families and the CNMI.

I caught the excitement and opportunity of that evening and even met with Tony a few days later to express my support for what he was doing. It is fine for me as a single citizen to be supportive of this institute just because I want to be. Due diligence is not required of me to encourage Mr. Pellegrino and his associates, and to support their efforts (although I personally would be inclined to be duly diligent in the interest of understanding how the institute will be operating). However, as a single citizen I’m allowed to be less rigorous and even be subjective in my feelings, thinking, and research.

Now here’s my point! There is a difference between me as a single citizen and the members of the Legislature. They are put in place to serve the people. They have a fiduciary responsibility to look after our interests in all that they do. And when it comes to passing bills and deciding upon funding they must exhibit the highest level of objectivity and due diligence. It’s not an option, but a must!

In the case of the Marianas Trades Institute, due diligence might include (but not be limited to) the following:

* Review the nature of the formal organization, including business licenses, insurances, officers and directors, affiliations, etc.

* Review the business plan, beginning with the mission statement, the scope of training, officers, directors, employees, training facilities, student fees, curriculum and, ultimately, jobs creation.

* Review the financial data including start-up costs, employee salaries and benefits, and pro forma income and expense statements, cash flow statements and balance sheets.

How much due diligence went on during the deliberations of this bill? I feel certain that many of us would like to know, and am certain that we all deserve to know. Let no one lose sight that all legislators are working for all of us; not just their families, their friends, or themselves. That may sound so obvious, but there is ample evidence that some (if not many) legislators have lost sight of this fundamental obligation. If they fail to behave responsibly they don’t deserve to be in office, and we should replace them with others more competent and honest.

Just thought I’d ask.