Another Tinian investor rethinking casino plans

Another major Tinian investor, Neo Gold Wings Paradise, is rethinking its plans to build a $200 million to $500 million hotel/casino on the island due to the federalization of CNMI immigration and the exclusion of Chinese and Russian tourists from the visa waiver program by June 1.

“Prudence…is now encouraging the notion that perhaps it might not be wise to continue with our development plans,” Neo Gold Wings Paradise chairman and president Hyun Myung told the U.S. Department of Homeland Security in connection with the regulations on the implementation of the federal immigration system in the CNMI.

Hyun is one of only 13 individuals and groups that have so far submitted comments on the interim final regulations on the establishment of U.S. ports of entry in the CNMI and the implementation of the Guam-CNMI Visa Waiver Program.

He said he is not questioning the reasons behind the implementation of federal immigration regulations in the CNMI but he is “quite baffled by the lack of sensitivity” to its economic effect.

Neo Gold Wings Paradise’s statement came three weeks after Bridge Investment Group LLC said it’s re-evaluating its $40 million to $50 million casino and condominiums project on Tinian because of federalization. Construction at the project site has halted.

“The direct impact of these regulations on…Tinian…will be devastating,” Phillip Mendiola-Long, executive vice president of Bridge Investment Group-CNMI, told DHS.

If the two casino investors pull out, Tinian stands to lose up to $550 million in investments.

The Tinian Casino Gaming Control Commission earlier said placing CNMI immigration under federal control by June 1 will affect the operation of Tinian Dynasty Hotel and Casino and the business strategies of three other investors proposing to build a total of at least $540 million worth of casino resort projects.

Tinian’s gaming industry relies heavily on Chinese tourists who will soon be required to secure a U.S. visa for entry into the CNMI.

“My company has thus far spent close to a million dollars just to position ourselves pursuant to the conditions of the casino license and other requirements in the CNMI. Prudence, however, is now encouraging the notion that perhaps it might not be wise to continue with our development plans,” Hyun Myung said.

He said he had sincerely hoped that Neo Gold Wings, along with others pursuing similar developments, will play a major role in stimulating the CNMI economy back to life.

“However, that probability may dissolve into mere penumbra should policies continue to ignore the ‘limited’ economic resources available to the CNMI, which requires sensitivity and unique approach,” he said.

He cited the following as major influences for investors to do business in the CNMI: The CNMI being a part of the United States; the CNMI as an approved destination to visit by the Chinese government; and the accelerating growth of affluence in China and its proximity to the CNMI.

The investor said that, unlike Guam, military plans for the CNMI are not definite and much of the land leased by the U.S. government in the CNMI for military purpose remains idle.

“Compounding the anxiety from the possible adverse economic effect of implementing federal immigration laws without considering the CNMI’s unique social/economic position is the gravity of having no room to rearrange priorities and seek alternatives as a result of what might be in those reports,” said Hyun.

Under the federalized system, Tinian will not only lose Chinese tourists but will also have difficulty hiring foreign workers, on top of the effects of the global economic crunch.

If nonresident workers are restricted from working in the CNMI after June 1, casino investors will face a huge challenge finding enough skilled and unskilled employees to staff the planned casino projects, the commission said.

The U.S. Department of Homeland Security published the interim final regulations on Jan. 16, and comments are due on March 17.

But as of yesterday, only the following have posted comments on the DHS regulations online: Hyun Myung of Neo Gold Wings Paradise; Del Benson; Marianas Visitors Authority managing director Perry Tenorio; MVA board of directors; Patrick San Nicolas; Jack F. McClure of Pacific Subsea Saipan Inc.; the Tinian and Aguingan Municipal Council; S.G Stephanson; Oleg Valentine Tchernychenko of Belka Tours; Juanita M. Mendiola; Joseph T. Guerrero; Laurie Peterka of Practical Solutions; and Bridge Investment Group’s Philip Mendiola-Long.

All the comments want a delay in the implementation of the transition to federal immigration system and/or include Chinese and Russian tourists from the visa waiver program.

“Please delay federal immigration until you have a program in place that accepts Russians and Chinese,” businessman Del Benson said in his comment to DHS.

MVA managing director Perry Tenorio said the CNMI stands to lose $339 million in tourism revenue annually because of the exclusion of China and Russia from the visa waiver program.

In his comment to DHS, Tenorio asked for the delay of the transition period until additional security measures are in place and DHS has determined that visitors from China and Russia can participate in the Guam-CNMI Visa Waiver Program.

Delegate Gregorio “Kilili” C. Sablan earlier write to Homeland Security secretary Janet Napolitano, asking her to delay by 180 days the implementation of federalization, but he said it will be best if Gov. Benigno R. Fitial asks for the delay.

The governor, who is now in Washington, D.C. said he will do so personally when he meets Napolitano in his official trip.