MVA can only cut $300K from budget

The Marianas Visitors Authority said it could only cut some $300,000 from its current budget, not $1.1 million as proposed by the Executive Branch.

In a report during yesterday’s board meeting, MVA managing director Tess Castro said the agency’s “working budget” now totals $5.6 million. This includes a restored funding of $126,000 for advertising.

The MVA management had earlier cut this amount amid calls from the Office of Management and Budget on all government offices to cut their budgets to meet the revised annual spending level of $198.5 million.

The MVA also “restored” the funding for Happy Children in Paradise summer program, amounting to $60,000, and the 42K marathon in June costing $25,000.

Castro said she restored the advertising budget, pursuant to discussion between MVA board chair Jerry Tan and administration officials led by Finance Secretary Eloy Inos.

She said the MVA has submitted the $5.6 million budget to the OMB.

“They have not confirmed it yet. We’re still waiting for their response,” said Castro.

Tan earlier said that MVA cannot sacrifice its advertising funds if it is serious in attracting more tourists. Even now, MVA is outspent several times over in advertising by its counterparts in Guam and Hawaii, he said.

“Guam’s budget is three times bigger and Hawaii is 10 times bigger than MVA’s budget for marketing,” said Tan.

The need to keep the advertising budget is most crucial in view of the Fitial administration’s goal to raise tourist arrivals in the CNMI to 1 million by 2008.

The CNMI received a little over 500,000 tourists last year.

The MVA board said that, instead of its budget getting slashed, the MVA should be getting more money to do its job. In an earlier presentation, MVA said that, based on its current budget, it needs a total of $2.3 million for the Japan market alone.

Without the advertising cost, MVA will still need $1.7 million for travel trades, airline costs, and representation fee, among others.

On MVA’s wish list, it also needs an additional $1.2 million to market the Osaka route, plus $700,000 for advertising.

MVA said it hopes to get 600,000 tourists from Japan in four years.

For the Korea market, MVA needs $1.2 million for marketing. MVA hopes to increase Korean tourist arrivals from 65,000 in 2005 to 85,000 this year; 95,000 in 2007; and over 100,000 in 2008.

For the China market, MVA needs $1.2 million for its promotional activities.

Based on conservative estimates, MVA hopes to increase Chinese tourist arrivals from 32,421 in 2005 to 37,000 this year, and 42,000 in 2007.

For the Russian market, MVA needs $40,000 this year.

The Fitial administration has revised the budget of most government agencies to reflect a revised revenue estimate of $198.5 million from $213 million.