But Saipan Independent Rep. Tina Sablan is questioning DPL’s decision amid findings that its memorandum of understanding with the firms allows the government to automatically severe its lease agreement when development in the targeted areas failed within a certain period.
The investors are Flame Sako and Neo Goldwings Paradise.
Sako proposes to build a hotel north of Paupau Beach on 109,000 square meters of public lands.
Neo Goldwings’ hotel project on Tinian is supposed to be built on 3 million square meters of public lands.
“It is unclear to me what legal authority DPL has to even grant such extensions, particularly when the lease agreements themselves stipulate that they shall automatically terminate upon failure to provide proof of financing by the specified deadlines. For Flame Sako, the deadline was April 30, 2009; for NGP, the deadline was Sept. 21, 2009,” said Sablan in a statement.
She said she asked for documents relevant to the projects but there was no response yet.
DPL could not be immediately reached for comments.
“I continue to be extremely concerned about the CNMI’s practice of approving major commercial leases of public lands to companies that are unable to show proof of financing for their proposed developments. It had been for that reason, among others, that I had voted against the lease agreements with both Flame Sako and NGP,” the lawmaker said.
“The lack of proof of financing, the generous terms of the lease agreements, and the considerable leniency that DPL has shown toward companies that have failed to comply with even these generous terms, should raise questions for all of us about the due diligence and fiduciary responsibility being exercised by DPL and the Legislature in approving these leases in the first place — and then in DPL’s enforcement of the leases once approved,” she added.
