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Amendment in FTZ bill sought
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Posted on Sep 28 1999
The Commonwealth Ports Authority has asked the House Committee on Commerce to delete a provision in the proposed Free Trade Zone which imposes minimum rental charge to allow the FTZ Authority and CPA negotiate a fair and reasonable rate.
If this is not acceptable, CPA Executive Director Carlos H. Salas proposed that the minimum rental should be not less than 50 percent of the current rate being assessed by the ports authority to its ground tenants.
Salas wrote to Rep. Oscar M. Babauta, chairman of the committee, to lobby for the inclusion of certain provisions in the Free Trade Zone Act. In seeking amendments to the FTZ measure, Salas said this would help the CNMI cope with the demand for a well-developed airport system and enhance the island’s aviation safety.
A separate letter was sent by CPA Board Chairman Roman S. Palacios to Gov. Pedro P. Tenorio and Lt. Gov. Jesus R. Sablan informing the two officials of the possible conflict between the proposed FTZ legislation and the CPA statute.
The proposed legislation should have a “saving clause” provision which would ensure that if any provision of the bill is contrary to or in conflict with CPA’s present or future grant agreements with the Federal Aviation Administration, revenue bond indenture covenants or other contractual obligations, such commitments shall not be impaired, compromised or subordinated and will still prevail.
The House of Representatives passed unanimously a measure providing guidelines, including the creation of a government agency that will oversee the ambitious project.
But the administration-sponsored legislation left open a plan to offer tax breaks and other incentives to potential foreign investors, citing the need to pass a separate measure that will deal with the financial component of the special economic sites.
Government officials are hoping that the plan will attract new business, create jobs for local people, stir industrial and commercial activities on the island as well as help diversify the economic base beyond tourism and garment manufacturing.
