Chamber backs bill extending public land lease

The Saipan Chamber of Commerce supports Senate Bill 20-35 to extend public land leases from 35 years to 40 years, plus an extension of up to 35 years, for a total of 75 years for new leases.

The bill also seeks to authorize extending existing public land leases by up to 75 years.

“The Chamber strongly supports this legislation and agrees that it would generate renewed interest by current and future investors,” said Chamber president Velma Palacios.

Senate President Arnold Palacios (R-Saipan) introduced the bill last March 22. It is now with the Senate Committee on Resources Economic Development and Programs for review; it is chaired by Sen. Francisco Borja (R-Tinian). The committee identifies the issues and public opinions about the proposed bill that can be used in aid of legislative review.

The committee held hearings on the bill last April 10 on Saipan and last June 29 on Rota.

The bill states that the longer lease would encourage lending by investment and financial institutions to finance major projects that will, in turn, create new job opportunities and stimulate other economic activities in the Commonwealth.
Currently, the leases of five major hotels on island are set to expire in about four years. The continued uncertainty over the fate of these hotels is worrying the business sector and the island’s labor sector.

In an interview last month, Hotel Association of the Northern Mariana Islands chair Gloria Cavanagh said, “The issue will have a great impact not only on the CNMI’s hotel industry but also on its lone economic driver, the tourism industry.”

The hotels that have expiring leases are Hyatt Regency Saipan, Fiesta Resort & Spa Saipan, Kanoa Resort, Pacific Islands Club, and Coral Ocean Point Resort Club.

Palacios said, “Many of our [HANMI and] Chamber members are pleased with the possibility that they will be given the opportunity for a 35-year lease extension.”

The bill’s proposed amendments still safeguards and respect lease agreements. It states, in the event public leases are going to be extended for up to 75 years, future public leases will be strictly scrutinized and approved by the Legislature and existing public land leases may be amended to extend lease terms by up to 75 years, subject to reasonable compensation and approved by Legislature.

“This legislation is in the best interest of our business community and benefits our tourism-based economy, that is why the Chamber supports this bill,” Palacios added.

After the committee issues its report on the bill, that’s when the bill will be put on the Senate calendar.