James T. Arenovski, chamber president, made the written statement amid the introduction of two bills in the House of Representatives aiming to change local incentives for investors.
These are House Bill 16-172, which seeks to establish an economic investment program, and House Bill 16-177, which aims to impose a temporary moratorium on the issuance, extension, renewal and modification of qualifying certificates.
Rep. David M. Apatang, R-Saipan, introduced H.B. 16-177.
Arenovski said the chamber’s government relations committee, co-chaired by Alex Sablan and Mike Johnson, reviewed the measures and came up with more questions.
“If the Legislature believes that the qualifying certificate program is flawed, then it should be fixed. If it cannot be fixed to accomplish the intended goals, then the qualifying certificate law should be repealed with the introduction of a substitute program,” Arenovski told Rep. Joseph C. Reyes, R-Saipan and the chairman of the House Committee on Commerce and Tourism.
Reyes is also the sponsor of H.B. 16-172, which Arenovski said will further complicate the incentive program for investors.
“Of greatest concern is that H.B. 16-172 seems to merely require a ‘business plan outlining a minimum new investment of $5,000,000.’ Nowhere in the legislation is there a requirement that an investment of that amount be made, nor is any consideration given to the scenario by which an investor receives benefits under the program, pursuant to a ‘business plan’ that does not actually result in an investment of $5 million or more,” said Arenovski.
He also noted that the measure may unfairly favor certain investors.
“This bill could, quite easily, provide an unfair, government-sanctioned, competitive business advantage to new investors of a magnitude that would result to the closure of businesses against which the qualified company chooses to compete,” he said.
Another area of contention on H.B. 16-172 is a provision that sets the program to expire after 36 months of enactment.
“We urge that the benefit period for a qualifying investment possibly survive the sunset provision of the act in order to provide equal benefit to each qualifying investment and to encourage new investors for the entire 36-month period,” said Arenovski.
H.B. 16-177 is not also good as far as the local business community is concerned, he added.
“While H.B. 16-177 would impose a temporary moratorium on the issuance, extension, renewal, or modification of qualifying certificates, there is no assurance that H.B. 16-177 will be enacted, nor do we believe, it should be enacted as currently written,” said Arenovski.
