Commonwealth Casino Commission Chair Edward C. Deleon Guerrero, center, Vice Chair Ralph S. Demapan, right, Commissioners Thomas A. Manglona, left, and Mario Taitano pose for a photo during their last meeting of the year on Friday.
THE Commonwealth Casino Commission on Friday disclosed a series of meetings with lawmakers and attorneys on how to “move forward” with Saipan’s casino industry.
During their meeting on Friday, CCC Board Chair Edward C. Deleon Guerrero said one of these discussions pertained to a recommendation to amend Public Law 18-56 or the casino law.
Considering the realities of the CNMI’s economic situation and understanding that the Commonwealth still needs $15 million a year to pay for the 25% benefit of the retirees, the CCC board proposed the following changes to the casino law:
1) Allow five casino licenses. The current $15.5 million annual exclusive license fee is excessive considering the economic situation. Require license applicants to pay a non-refundable fee of $600,000 per license, and remove all references to an exclusive license.
2) Reduce the minimum investment requirement to $100 million from $2 billion per licensee or allow a licensee to invest a minimum of $25 million to renovate existing properties. In addition, allow existing hotel rooms that are not fully utilized to be modified and used for gaming.
3) Reduce the required number of rooms from 2,000 to 300 per licensee.
4) Reduce the license fee from $15.5 million to $3 million.
5) Reduce the regulatory fee from $3.15 million to $650,000 per licensee.
6) Get rid of the community benefit fund.
7) Impose a 5% gaming tax on the gross gaming revenue.
8) Allow the CCC to amend the casino license agreement.
CCC also recommended the imposition of a one-time $15.5 million license fee and a $3.15 million regulatory fee on whoever assumes the license from the current holder, the Imperial Pacific International, “since that’s in the current casino law.”
Deleon Guerrero said the CCC believes that these recommendations will address the ongoing issue with the casino on Saipan without violating the contract clause of the CNMI Constitution.
The proposed amendments, if enacted into law, would take effect only after one of the three scenarios:
1) The current exclusive casino license held by IPI expires, in about 37 years from now.
2) The CCC revokes IPI’s exclusive license.
3) IPI voluntarily surrenders the license under an agreement to be negotiated by IPI.
“Then the new law would take into effect,” Deleon Guerrero said, adding that the CCC believes “the Legislature is free to move forward without fear of violating the contract clause of the CNMI Constitution.”
IPI operated a casino on Saipan for four years until the Covid-19 pandemic forced its closure in March 2020.
On April 19, 2024, IPI filed for Chapter 11 bankruptcy in the District Court for the NMI, saying it owed creditors over $165.8 million.
