House floor leader floats idea of lifting poker moratorium

To generate revenue, House floor leader Rep. John Paul Sablan (R-Saipan) is floating the idea of amending the casino law to lift the moratorium on the acquisition of new poker machines on Saipan.

Sablan shared the idea during a House meeting last week, in which members were brainstorming about revenue-generating bills because of the financial crisis caused by the coronavirus outbreak in China.

In an interview, Sablan said the moratorium that they were talking about only affects Saipan, politically referred to as the third senatorial of the CNMI.

He said the moratorium began in April 2015 when it was included in the casino law, Public Law 18-57. The lawmaker said a provision in the casino law caps or disallows any new acquisition of poker machines after April 2015.

Since passing the casino law, Sablan said the operators of poker parlors have had difficulties looking for new locations because Saipan Local Law 18-05 also prevents them from setting up shop in residential areas.

Some businesses that used to operate poker parlors have found buildings where they can expand poker businesses in conforming areas but Sablan said these businesses cannot bring in any new machines because of the moratorium that was placed in the casino law.

“The idea of lifting the moratorium would essentially allow any new investors that want to do business in poker parlors or even for that matter the existing ones to expand, and avail themselves more poker machines,” he said.

Sablan pointed out that every poker machine’s annual license fee is $12,000. Of that amount, $6,000 goes to the general fund, while the remaining $6,000 goes to the Saipan and Northern Islands Legislative Delegation.

He said that a big chunk of the $6,000 that goes to the Saipan delegation is appropriated by statute to the Saipan Higher Education Financial Assistance, a scholarship program for Saipan students.

Sablan said the law allows the delegation to appropriate any excess of that money to infrastructures or projects that need to be done on Saipan.

Saipan lawmakers annually appropriate some $3 million in poker license fees to SHEFA.

Poker businesses pay $12,500 per poker machine, which translates to at least $3.75 million if there are at least 300 machines. In recent years, the number of licensed poker machines on the island has plummeted.

The financial crisis the CNMI is having right now with the coronavirus outbreak, which has effectively bottlenecked the entry of Chinese tourists, is why the idea of lifting the moratorium came about, Sablan said.

“We have to be creative and innovative in trying to think of how can we further receive revenues by whatever businesses that we can expand,” Sablan said.

Right now, he said, poker businesses cannot expand because of the moratorium outlined in P.L. 18-56. “By lifting that [law], that would allow poker parlors to expand or even create new poker parlors,” he said.

The only way to lift that moratorium is to amend the casino law and strike out that provision, Sablan said.

He said that lifting the moratorium is on the table and that most, if not all, House members are considering the idea at the moment.

He said allowing for additional new poker machines would result in new revenue and create more funds for Saipan children that are pursuing higher education.

“It is something that we’re [going to] consider,” Sablan said.