A perspective in a US Commonwealth democracy

Third part of a series

The crown jewel of the Marianas
Our approach to our local tourism is simple: Juan S. Torres and I will make the industry the top priority in our administration.

Juan S. Torres and I will not waver in our commitment for immediate and full implementation of the Marianas Visitors Authority’s Tourism Master Plan (2012-2016 and beyond). The Babauta-Torres Leadership will lead the CNMI as a destination of choice for business, for tourist, and for trade and commerce, and the centerpiece of the CNMI’s hospitality industry will be the CNMI host-culture. How, for instance, can we establish the CNMI as an international sports village and develop the local regulatory and support infrastructure. Tourists oriented modernization and expansion of our public pathways and roadways, traffic management and public transportation infrastructure, and in particular, tourist frequented sites should also be enjoyed by our citizens. We will openly embrace, encourage and pursue public-private partnership (e.g. BOT) in tourist-related and public service infrastructures.

Moreover, we will repackage and pursue without delay comprehensive and sensible heritage tourism. We will collaborate with countries with colonial vestiges in the Mariana Islands. These countries include Spain, Germany, Japan, the U.S. and Europe. Authentic remote Mariana Islands adventure and cultural experiences will be integrated into the existing tourist destination portfolio. Gani Islands, north of Saipan for example, will be promoted and marketed for adventure filming and nature-related TV advertising (e.g., Pagan, Sarigan, and Alamagan, etc.).

Additional industries aimed at boosting tourism include ecotourism, agro-tourism, edu-tourism, heritage tourism, sports tourism, film and TV advertising, military tourism, and volunteer tourism. Sister city tourism and convention tourism will be mapped out in order to strategically target Asia. Volunteer tourism will be crafted into the mix.

To succeed in these efforts requires focus and attention on the CNMI’s lift capacity. BT will engage in consultative dialogue and personally develop relationships with airlines, cruise liners, and other providers of tourist transportation. For instance, cruise liner-air link booking could be explored, especially with study tours, long-term travelers, and niche tourists. Our administration will integrate local marketing efforts with Destination America that markets the CNMI internationally, especially in countries with historic vestiges in the Marianas.

Of property and Article 12
Because of the lack of reliable information and public education on property restriction in the Northern Marianas, there is a current push to either abolish or to modify property ownership system in the homeland. It is our considered view that a flexibility in renewal option may serve to resuscitate the economy by spurring major investment the Commonwealth experienced in the mid-’80s before the bubble burst. This adjustment through a renewal option will revitalize the real estate market, broadly spreading the benefits to landowners, real estate brokers, and investor capitalists (i.e., multiplier effect).

In other words, a more flexible long-term interest in real property will enable institutional lenders and guarantors to finance commercial development transactions. This will enable business opportunities to flourish in the secondary market. The current base term leasehold interest in real property of 55 years and subsequent renewal leasehold option term of 25 years beyond the 55-year base leasehold term should be sufficient for business recovery and amortization purposes. Moreover, traceable lineage burdened on the applicant should substitute for blood quantum. However, the fate of Article 12 in the Constitution is a topic that merits comprehensive consideration by all stakeholders. Ultimately, the future social and economic health of the CNMI rides on the balance.

Contrary to popular belief, a non-NMD could own in fee property in the CNMI by purchasing, say, a condominium with common appurtenances above the first floor in a privately-owned realty. There are a number of realty transaction in this category but are not actively marketed by real estate agents. Additionally, the vast stretches of open submerged land within the 3-mile exclusive economic zone, including the CNMI’s seabed nodules, other minerals and geothermal reservoir, are not actively explored for open and competitive marketing. BT is committed to this venture.

Moreover, it was reported in the local newspapers that a submarine cable runs by or through the Northern Islands. It appears based on the article that the local government is clueless on this discovery. Juan S. Torres and I will immediately launch a preliminary site assessment to determine whether the CNMI has beneficiary interest within its 3-mile EEZ waters. This could be a revenue bonanza if handled prudently.

Speaking with bankers on financing real property in the CNMI made it apparent that Article 12 per se is not the problem as much as with the CNMI’s mechanic lien statute. Institutional lenders and guarantors in the CNMI have experienced certain difficulty in obtaining mechanic lien endorsement from local title insurance companies due to certain ambiguities in the mechanic lien law. The present situation prevents title insurance companies from providing mechanic lien endorsement in financing house construction loan or home purchase mortgage, for example.

What is needed, therefore, is to first strengthen the existing mechanic lien statute. Specific timetable must be established for contractors, subcontractors, or material suppliers in filing liens against completed, partially completed, substantially completed or abandoned project improvement financed or guaranteed in whole or in part by a CNMI-licensed lending institutions, a CNMI-government entity, or a federal agency institutional lender or guarantor. Babauta-Torres will work collaboratively with the Legislature in reforming this and a host of other public policies on performance government, revenue generation, regulatory reforms, and seamless investment in higher education all the way to early childhood education.

To be continued.

JUAN N. BABAUTA and JUAN S. TORRES
Special to the Saipan Tribune