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OVERSIGHT ON OUTER COVE Public hearing tackles lease agreement
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Posted on Sep 01 2000
The Senate Committee on Resources, Economic, Development and Programs resumed its oversight hearing yesterday on the financially-troubled Outer Cove Marina, zeroing in on the lease agreement.
Senators are hoping to trace the root cause of the dispute over rates and safety of the marina that has erupted between Marine Revitalization Corp. on one side and boat owners and tour operators on the other side.
For the second time, government officials were grilled for their role in approving construction of several structures in Outer Cove despite specific terms laid out in the lease.
The panel questioned the construction of Mobil fueling station within the marina, when the lease in fact stated that no fuel should be situated within the area.
But the structure was built on the federal lands, and not on the submerged lands which are part of the lease. A Mobil representative told the hearing that they invested hundreds of thousands of dollars in the marina.
Anthony Pellegrino, the embattled president of MRC, said they jointly invested $450,000 as “gift to the CNMI” through roads, underground electricity and underground waterline built within the marina.
MRC, a non-profit corporation, forged an agreement for a 15-year lease with the Department of Lands and Natural Resources and the U.S. National Parks Service during the previous administration to build and operate the marina.
The lease covers 16,394 square meters of submerged lands with the marina initially estimated to cost $1.2 million. But the project ballooned to $3.6 million which MRC is now trying to recover through rate and fee increases.
Boat owners and tour operators have opposed the hikes due to the slowdown in the tourism economy and have asked intervention by the CNMI government.
Senate Floor Leader Pete P. Reyes, chair of REDP, said the findings made during yesterday’s hearing would be part of committee report on the controversy.
The hearing, which began Wednesday amid emotional arguments from opposing parties, is scheduled to resume on Sept. 7 at 10:00 a.m. in the Senate chamber.
