HANMI chair welcomes opportunity for new leases

The Hotel Association of the Northern Mariana Islands says it welcomes the opportunity for its member hotels to enter into subsequent public land leases, a move endorsed by a recently issued legal opinion.

Cavanagh

At the suggestion of the administration, HANMI has sought a legal opinion on the matter, and says negotiating new leases is allowable and welcomed by the hotels.

“There is no Constitutional provision, statute, case or other law that prohibits the DPL (Department of Public Lands) from entering into a subsequent lease of public land with the same lessee. To the contrary, the drafters of the Constitution specifically clarified that it is constitutionally permissible to enter into such a subsequent lease,” said HANMI chair Gloria Cavanagh. “This is good news, as our affected hotels all wish to continue doing business in the Commonwealth.”

The first hotel with an expiring public land lease (in 2018) is Mariana Resort & Spa, where Cavanagh is GM. Other hotels with upcoming expiring leases through 2025 are Hyatt Regency Saipan, Fiesta Resort & Spa, Kanoa Resort, and Pacific Islands Club Saipan.

“We’re proud to have been a part of the community since the beginning of the tourism industry,” said Cavanagh. “We’ve grown together, suffered together, and are now recovering together.”

Cavanagh also stated that the government’s fiduciary duty requires that consideration be made on how best to ensure a healthy and sustainable tourism economy.

“Our hotels on public land serve a healthy tourism market mix of Japan, Korea, China, and Russia,” said Cavanagh. “When we talk about the government’s fiduciary duty, we believe the CNMI needs to avoid putting all of our economic eggs in one basket. We all suffered when the Japan economic crisis hit in the 1990s and the CNMI economy crashed. Ensuring market diversity is a critical part of fiduciary duty.”

“Mariana Resort & Spa, Hyatt Regency Saipan, Fiesta Resort & Spa, Kanoa Resort, and Pacific Islands Club Saipan all began discussions, regarding their respective lease proposals, at the written request of DPL Secretary Pete A. Tenorio over a year ago.”

HANMI members account for most of the hotel rooms in the Northern Marianas. Last year, HANMI members contributed $13.2-million in hotel occupancy tax to government coffers, as well as $4.4-million in gross revenue receipts. The hotel industry is the largest private employer in the CNMI, with HANMI members currently employ about 1,600 employees. (HANMI)