CHC pays $3M MPLT loan; extension of line of credit OK’d

The Commonwealth Healthcare Corp. has been given another year to access its line of credit with the Marianas Public Land Trust, according to board chair Joaquin Torres yesterday.

Torres said the MPLT decision to approve the extension request came days after the corporation paid in full the outstanding $3 million principal it borrowed last year. The payment on the principal loan, plus the remaining monthly interest on the line of credit, was made Friday.

MPLT board chair Martin B. Ada notified the corporation of MPLT’s decision on April 14, setting a one-year extension of CHCC’s line of credit from April 14, 2014, through April 13, 2015, with conditions. The loan is assigned 7 percent per annum interest.

The new loan, however, is contingent on a number of conditions that include, among others, assurance that the corporation is committed to hiring a permanent chief financial officer.

Every drawdown request from CHCC must also be made in formal request and with justifications signed by the CEO. The intended purpose and use of the drawdown must be disclosed and requires a 10-day notice for any drawdown request.

Ada made it clear that every drawdown request is subject to the MPLT board’s approval and it has the right to deny or reject any drawdown request.

Part of the conditions is that “the first drawdown request shall be used to the specific and directed purpose of hiring a CFO and the implementation of a financial management system.”

CHCC shall also submit quarterly financial statements within 30 days of the end of each quarter. Projections of income and expenses for the remainder of the fiscal year is also required.

CHCC is also being required to submit audited financial statements—both draft and final—as they are received by CHCC, including any management letters and compliance findings.

Any CMS reports or findings shall also be provided to MPLT within 30 days of receipt by CHCC.

During yesterday’s board meeting, the newly approved line of credit was tackled in an executive session following revelation that there are some concerns pertaining to the Navy Hill property earlier assigned to CHCC and used as collateral in the original MPLT loan. This property has since been reclaimed by the Inos administration.