‘IPI’s $15M license fee due next week’

Commonwealth Casino Commission acting chair Joseph C. Reyes presides over CCC’s regular meeting last Wednesday. (Ferdie de la Torre)

Aug. 12 next week is the due date for Imperial Pacific International (CNMI) LLC to pay its annual exclusive casino license fee in the amount of $15 million plus potential adjustment, according to Commonwealth Casino Commission audit manager Charlie O. Atalig.

Atalig told CCC commissioners during last week’s meeting that IPI should pay more than $15 million because there is a provision in the law that there may be an adjustment for the cumulative consumer price index every five years.

This month is IPI’s sixth year, so that means there may be an adjustment, Atalig said.

In an interview, though, Atalig said the problem is that the Central Statistics Division of the Department of Commerce, is not ready yet with its CPI information.

“It’s not finalized. And you need that information in order to determine what the cumulative CPI changes,” he said.

The best that the CCC can do is possibly recommend an estimate relating to the adjustment, Atalig said. The only problem with that, he said, is that if the estimate comes under, the commissioners and CCC may be blamed for penalties that might be associated with underpayment of the adjustment.

Atalig said the CCC could essentially provide IPI a projection and leave it to IPI to come up with its own estimate as to how much they think they should pay.

If the CPI numbers are not finalized, then he would recommend that IPI overpay on the adjustment so they can avoid any underpayment penalties, if there are any.

IPI should pay $15 million, Atalig said, and possibly $500,000 more in potential adjustment, depending if the CPI shows that there was inflation.

“So, if there is no inflation, it is just $15 million,” he added.

Atalig said they have been in contact with the Central Statistics Division of the Department of Commerce to determine the cumulative change. He said the Central Statistics Division staff are still finalizing their figures for two quarters of 2019.

Atalig said these figures are necessary in determining the final CPI change.

Atalig said he figured out that CCC should probably not be recommending an estimate. “If we put our recommendation in, even if there was a spike because of Super Typhoon Yutu, we would be blamed for the estimate should it comes under,” he said.

Atalig recommended that IPI make the conservative estimate.

CCC executive director Edward Deleon Guerrero said for purposes of $15 million a year exclusive casino license fee, Public Law 18-56 says that for every five years the $15 million is to be revisited and adjusted based on the CPI, but it can never be down.