Babauta: SHEFA has so far lost over $0.5 million

The Saipan Higher Education Financial Assistance program has lost over half a million dollars in just two months after the poker extension bill was killed by the Saipan and Northern Islands Legislative Delegation.

During yesterday’s SHEFA board meeting, SHEFA chair Oscar Babauta informed the board members that, as of this month, the defeat of the bill that would have given poker arcades more time to relocate has already cost them over $500,000 and the number will only continue to go up.

From an annual $8.4 million appropriated to SHEFA from the gaming machine tax, the program would now only get a little over $7.5 million, Babauta said.

The number is not final, as it will continue to lessen and a number will only be finalized after the relocation deadline.

It was learned at the meeting that the poker industry on Saipan has already lost over 90 gaming machines.

As of last week, the number of registered gaming machines went from 726 to 633, which means 93 gaming machines whose licenses to operate were not renewed, Babauta said.

Babauta is sure that the number of gaming machines will only continue to fall. The exact numbers of machines lost will be finalized by November after the relocation deadline in October.

Under the law, all poker arcades on Saipan have to be relocated to a central location by October 2017. The Zoning Office is tasked with identifying a place for the relocation. Many poker arcade owners have tried to push this deadline, to no avail.

Babauta, along with SHEFA board members, are scurrying to find an alternate source of funding for their program, the sooner the better.

To combat the loss in funding, Babauta said that he is working with the Legislature to pass a resolution allocating $1.5 million from the Saipan casino’s Business Gross Received Tax to SHEFA.

Rep. Ivan Blanco (R-Saipan) was the author of the resolution that wants SHEFA to be included as one of the recipients of the BGRT funding.

Although Babauta is grateful for this effort, he actually eyes $3 million from the casino’s BGRT because it is uncertain how long the poker industry will remain and how many machines will be left after the relocation period is over in October.

“The problem now is that we don’t know how long the poker industry will survive, or whether or not they will reduce he number of machines should they relocate,” said Babauta.

He is not hoping for the best but, according to him, the poker industry may not even recover.

“I’m not too optimistic about them surviving more than they are doing now,” said Babauta.

As of Aug. 23, SHEFA has already rewarded a total of $729,800 to 892 students for the fall semester.

SHEFA’s mission is to ensure funding to assist the upcoming generations who wish to pursue a higher education but do not have the money to do so.