‘Salary cuts benefit no one’

Edward C. DeLeon Guerrero and Ian R. Morrell

Instead of slashing the salaries of Commonwealth Casino Commission board members and capping the salaries of its employees, the Legislature can make better use of its time by figuring out ways to progress rather than imposing limitations on hardworking government employees.

That, essentially, was the response of CCC board chair Edward C. DeLeon Guerrero to a bill proposed by Rep. Celina R. Babauta (D-Saipan) that describes the compensation of the CCC as exceeding that of many other government instrumentalities, despite the current suspension of the casino license of Imperial Pacific International (CNMI) LLC.

In a letter dated Aug. 11, 2022, to Babauta and House of Representatives Speaker Edmund S. Villagomez (Ind-Saipan), DeLeon Guerrero and CCC acting executive director Ian R. Morrell said the bill would not only reduce the compensation of CCC members, but it also effectively brings the pay of CCC employees to an already outdated, noncompetitive, and insufficient scale. DeLeon Guerrero and Morrell sent the letter in response to the two lawmakers’ request to comment on House Bill 22-111.

DeLeon Guerrero and Morrell said the commission does not support this bill as it will cause significant challenges to their efforts to efficiently and effectively regulate the casino gaming industry and enforce its statutory mandates.

Babauta stated in the legislation that the compensation of the CCC exceeds that of many other government boards. Yet, she said, with the license of IPI suspended, the funding mechanism for this “generous compensation is now effectively defunct.” Babauta said it is necessary to bring the compensation of commission members in line with other public boards and commissions.

But DeLeon Guerrero and Morrell said the bill’s proposed amendments fail to address the intent of the legislation.

“As elected representatives of the people of the CNMI, it would seem a more beneficial and better use of the Legislature’s time and energy to figure out ways to progress and to raise the CNMI’s standards rather than imposing limitations on hardworking government employees,” DeLeon Guerrero and Morrell said.

They noted that CCC members and their immediate families are prohibited from employment or receiving anything of value from the casino gaming industry.

DeLeon Guerrero and Morrell said the CCC has also been receiving only $1 from the government’s general fund’s annual appropriations and that it’s only recently when the government did offer to increase its annual local appropriations to CCC to $1,000.

“Thus, we fail to see the need for this bill,” they pointed out.

The two CCC officials said the proposed legislation limits the commission’s ability to recruit competent regulatory professionals in a highly competitive gaming industry.

They said government employment benefits, including life insurance, health insurance, annual leave, sick leave, and other fringe benefits, are not available to commission members. In short, they said, commissioners are not entitled to government employee fringe benefits.

DeLeon Guerrero and Morrell said several current CCC members are not government retirees and, by making some provisions of the Commonwealth Code applicable to CCC, the Commonwealth may be forced to incur additional costs to cover the employee benefits.

The two CCC officials noted that, while IPI is, in fact, not currently operating due to the license suspension ordered by the CCC, the commission’s work does not stop.

“As long as the licensed operator is in possession of the casino license, the licensee will fall under the purview of the commission,” they said.

DeLeon Guerrero and Morrell said that, as an autonomous agency, the commission members’ current compensation level should therefore remain the same.

They said the proposed law, as written, does not reflect the intention to “bring the compensation of the commission members in line with other public boards and commissions” as described.

DeLeon Guerrero and Morrell said that reducing the salaries of the commissioners or capping the salaries of the commission’s employees does not benefit anyone.“As a matter of fact, it does just the opposite. It takes away interest, it discourages motivation, and it limits our capabilities,” they said.

DeLeon Guerrero and Morrell noted that due to the current lack of funding, the commission has already had to release over 80% of its staff, putting over 40 people out of work and/or forcing them to accept lower incomes.

They said these are people who have undergone world-class training from casino industry giants like the University of Nevada-Las Vegas, Gaming Laboratories International, World Gaming Protection agencies, the Internal Revenue Service, Federal Bureau of Investigation, and Dahlmeier Surveillance Systems, to name a few.

DeLeon Guerrero and Morrell said the training and experience that these employees have acquired give them expertise that no other government agency on island can claim.

They believe that the CNMI as a whole should be growing, encouraging higher pay for its professionals, its people and its economy. They said the commission has brought with it new ideas, new opportunities, and new professions.

“Rather than reducing the capability for the CNMI to grow, we should focus on broadening the horizons of the CNMI and its people and implementing economic development programs to rejuvenate and revitalize our local economy,” the two CCC officials said.

They added that the CNMI needs to search for ways to raise the stale and outdated standards of the Commonwealth to new, modern, and appropriate levels.