Skymark has landed

The takeaway is that we need to help Skymark help us help them. This new era of Japanese tourism to the Northern Marianas depends on a mutually beneficial relationship. Skymark can’t fly unless we keep their customers happy, satisfied, and feeling as if they got their money’s worth out of their vacation to paradise. We can’t keep our economy together without a vibrant source-country diversified tourism industry. We allow ourselves to rely on only two major volume source markets at our peril. Sooner or later, that will break and leave us stranded. We need three or more major source markets to safely and profitably navigate our economy through the turbulent air of a delicately balanced industry like tourism.

We need Japan. Skymark needs a profitable offshore route. We need to help them keep those planes full with top quality promotional programs from MVA. We need to make sure our product—Saipan, Tinian, and Rota—are as good as we can possibly make them. Working together, everyone wins. “Tourism is everybody’s business” was never truer than during this early period of direct flights from Tokyo/Narita once again. We can do it. We must do it. I have to help, however I can. You need to help, however you can. Think about it and please do whatever you can to help.

One last point. Skymark has said they are interested in bringing in charter flights from outlying second and third-tier cities in Japan to Saipan. This is a very important source of new clientele for us. Much work has been done by MVA to promote our islands to the visitors from Osaka and Nagoya, but they had no flight to get here anymore. Now they will have those flights on a charter basis. Third-tier cities like Sendai, Niigata, Hiroshima, Fukuoka, Sapporo, etc. offer fresh new possibilities to expose the friendly folk of Japan to our natural wonders here on Saipan, Tinian, and Rota. Let’s help Skymark bring in those charters.

Yes to B&B’s, no moratorium

It was heartening to see a voice of reason speaking out in the form of Ms. Tracy B. Norita, Revenue and Taxation director for the CNMI, part of whose job it is to oversee and maximize income sources due the government. In her professional opinion, it would be a mistake to leave the money on the table that new B&B businesses will bring into the treasury of the CNMI if they are forbidden to even apply to start their new businesses. I agree and would add that those type of businesses provide a much-needed service to our tourism industry by providing alternative short-term accommodations to some of our tourists looking for that kind of vacation experience.

In her testimony to the House of Representatives on the matter, she added that not only was the moratorium on licensing new B&Bs a bad idea but that the proposal to stop new businesses from applying for three long years was not something done by any other taxing jurisdiction.

Her key point in opposing Lee Pan’s H.L.B. 21-32 was that the bill would stop legitimate new businesses from starting up but does essentially nothing to solve the problem that Leepan cited for introducing the legislation in the first place. That some B&Bs currently providing the service are not properly taxed or licensed by the government. She is absolutely right—if we are not collecting the hotel occupancy tax correctly from some businesses that needs to be addressed immediately by the appropriate agencies: Commerce for licensing and Finance enforcement for the taxes. By P.L. 18-1 the Department of Finance gets hundreds of thousands of dollars annually from the HOT to enforce that taxes’ proper payment. So enforce it already.

If 20% of B&Bs are not paying their tax or are not properly licensed, simply ferret them out and force them into compliance, along with the other 80% doing it right. This is not rocket science. Some googling to see who is advertising, some sleuthing to find the others, the purchase of a few padlocks to immediately shut down any unlicensed business (including locally owned “apartments”) not paying their tax. If a business offers to rent rooms to the public by the month or by the year, it is an apartment. If they offer such rooms by the day or the week they are a hotel and should be paying the tax. Simple. So simple in fact that I hereby offer to subcontract this simple job of finding offenders for a measly 15% of what new income I can bring in to the CNMI coffers. What a nice guy. Email me for details.

Seriously, there is money to be made. Enforcement procedures need to be put into place that will produce results right away. There is just no excuse for not enforcing the law. The slackers hurt our income but not as bad as putting a moratorium in place that chokes the very business we are relying on out of business before they even start.
I oppose any B&B moratorium, as should any thinking person. Cure the real problem—poor enforcement. Don’t worry with nostrum powder to calm the itch when, with less effort, we can cure the sore that causes the itch. Crank up a massive positive cash flow engine by finding, identifying, and charging current and future taxes to all such establishments plus a nice hefty fine for past transgressions, payable along with their new monthly HOT tax in small installments so they can stay in business and provide our government with the money it needs and our tourists with a place to stay.

Thanks for reading Sour Grapes!

“A fine is a tax for doing something wrong. A tax in a fine for doing something right.”
—Malcolm St. Pier

“Worried about an IRS audit? Avoid what’s called a red flag. That’s something the IRS always looks for. For example, say you have some money left in your bank account after paying your taxes. That’s a red flag.”
—Jay Leno

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Bruce A. Bateman resides on Saipan with a wife, a son, and an unknown number of boonie dogs. He has owned and operated a number of unusual businesses and most recently worked as the marketing manager for MVA. Bruce likes to read, travel, tinker with bicycles, hike, swim, and play a bit of golf. He is opinionated and writes when the moon is full and the mood strikes.