Kiyu seeks amendment to FTZ bill • Senate Vice President raps colleagues for overlooking hiring of locals

Senate Vice President Thomas P. Villagomez yesterday vowed to push provisions in the proposed free trade zones in the Northern Marianas that will guarantee employment for local workers as well as ensure benefits for the CNMI from tax incentives offered to potential investors.

He expressed disappointment that the Senate approved the measure despite his concerns on the proposal which he said remain unanswered.

“I don’t know what convinced senators to pass the bill but I am going to work on some amendments for inclusion into the final proposal,” Mr. Villagomez told in an interview.
He was off-island attending to his wife, Vicky who had a surgery in the U.S. mainland, when the Senate approved the legislation last week after nearly two months of holding off action pending further review.

Its passage came after members of the upper house met early this month with business leaders and administration officials who pressed them to act on the bill.

Sen. Joaquin G. Adriano, however, offered minor amendments, including restrictions on the use of public lands for each of the proposed special economic zones on Rota and Tinian as well as granting powers to their municipal mayors to seek assistance of public lands officials and other government agencies in the administration of the designated lands.

He also proposed that rental amount for use of public lands for the FTZ be lowered by up to 30 percent from that stipulated by authorities through determination by the mayor based on the economic or other public benefit of the project.

But Mr. Villagomez’ concerns on the length of tax breaks given to investors and the lack of assurance that resident workers will be provided jobs were largely ignored.

More changes

He said he would try to insert these changes when the proposal comes up again in the Senate as he noted that the lower house may not be able to vote on the amendments because of inability to meet the required three-fourths votes from the 18-seat chamber.

“I am not opposed to the bill, I just hope that we could make it more pro-local in terms of employment opportunities,” added Mr. Villagomez.

Introduced by Speaker Diego T. Benavente last March, House Bill 11-389 went through a three-month intensive review by the joint committees of Commerce and Tourism as well as Ways and Means to incorporate recommendations from the private sector and other public agencies.

Lawmakers stressed the significance of the proposal in stimulating the local economy which has suffered heavily in the wake of the economic recession in Asia, it main source of tourists and investments.

The plan will attract new businesses, create jobs for local people, stir industrial and commercial activities on the island as well as help diversify its economic base beyond tourism and garment manufacturing.

Lawmakers also noted other potential benefits, such as training opportunities for locals by highly-skilled workers who will be hired by businesses within the zone.

To entice investors, it will offer up to 100 percent tax abatement for a period of not more than 20 years, subject to several conditions, such as hiring of locals.

The free trade zone is envisioned as the centerpiece of Gov. Pedro P. Tenorio’s administration which has been confronted by the two-year economic crisis spawned by the Asian currency crunch.

Mr. Villagomez initially lobbied other senators to defer final voting on the proposal precisely because of questions on the tax incentives and the workforce for the new investors despite pressure from the administration to hasten its passage.