CPA eyes land lease to FTZ investors

The Commonwealth Ports Authority will earn some $538,213 every month from the expected lease of its 20-hectare airport land to Free Trade Zone investors should it decide to charge $.25 per square foot.

However, if the CPA management decide to rent it for $.30 per square foot, the ports authority will be able to generate an additional monthly revenue of $645,855.

This was the financial analysis made by the CPA board finance committee when it deliberated on the reasonable rental fee that will be charged to prospective investors in the soon to be established Free Trade Zone. The proposed charges are 50 percent less than the current rental rate.

Board member Roman Tudela, who heads the finance committee, emphasized the need for the ports authority to negotiate for a reasonable and fair rental of its airport property.

The proposed measure establishing the Free Trade Zone in the CNMI mandates the use of some 60 hectares of land in the vicinity of Saipan International Airport. But the ports authority wants only an initial 20 hectares of its land set aside and the additional land area to be given as the need arises.

During a recent meeting, board members said the CPA master plan has designated the area for the airport’s future long-term industrial development and taking it away from the ports authority would jeopardize its future plans.

In a resolution, board members expressed concern over certain provisions of HB 11-389 establishing the Free Trade Zone in the CNMI. Board chairman Roman S. Palacios clarified that the ports authority is not against plans to set up a Free Trade Zone but is merely asking the legislators to reconsider their proposed amendments.

One concern raised by CPA is a provision that empowers the FTZ Authority to designate Free Trade Zone areas, including lands owned by the ports authority. CPA-owned properties can only be earmarked for other purposes upon the approval of the board.

The board also wants to make it clear that where an FTZ is located on property owned by the ports authority, CPA rules and regulations shall apply and prevail if these conflict with FTZ statute, rules and regulations.

“All CPA lands that are being designated for the Free Trade Zone are unimproved property and CPA has no obligation to construct or install infrastructures needed by the FTZ industries within the zone,” the board said. Furthermore, any improvement, structure, building or infrastructure to be built on CPA property designated as a Free Trade Zone shall be subject to the prior review and written approval of CPA.