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Sablan fears for more cuts to MVA budget
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Posted on Mar 12 1999
Marianas Visitors Authority board chairman Dave M. Sablan yesterday expressed concern that the agency’s budget for fiscal year 2000 would be further reduced as a result of the plunge in the CNMI’s tourism economy.
With the 13.4 percent budget cut imposed by Gov. Pedro P. Tenorio due to shrinking revenues and drop in hotel occupancy, Sablan said MVA may end up having only a $4.8 million for fiscal year 1999.
Based on MVA’s earlier analysis, a 13.4 percent budget cut means that the agency would lose only $938,000 from the $7 million budget. Sablan maintains that MVA should not get a cut in its hotel occupancy tax since it has been drastically reduced due to the plunge in tourist arrivals.
MVA had temporarily suspended the implementation of its various capital improvement projects due to budgetary constraints. Despite limited funds, it is still trying to out a promotional campaign in Japan with the hiring of Tokyo-based advertising firm Dentsu 10.
The governor had earlier said that MVA will not be included in the budget slash since it is already getting a reduced appropriation due to the drop in its share in the hotel occupancy tax.
But the Office of Budget and Management as well as the Department of Finance maintain otherwise. The agencies said failure to include MVA would mean a higher budget reduction for other agencies.
Next week, the MVA board of directors will meet to discuss the budget for fiscal year 2000. Although MVA has not been able to fully carry out its promotional plans, Japan Airlines had assisted the tourism agency in getting back its market share in Japan by implementing its own campaign to lure more Japanese to visit the CNMI.
In 1998, arrivals from Japan made up 75 percent of the 526,298 total in-bound visitors. Japan, the world’s second biggest economy, has been experiencing its worst recession since World War II.
