Exposing the Risks of House Legislative Initiative 17-1

A letter from Tina Sablan and Glen Hunter:

“We must not let our rulers load us with perpetual debt. We must make our election between economy and liberty, or profusion and servitude.” – Thomas Jeffferson

On November 2, voters will be asked to make a decision on House Legislative Initiative 17-1, which proposes to change the CNMI constitution in order to authorize the CNMI government to issue pension obligation bonds.

Currently, Section 4 of Article X limits public indebtedness to not more than ten percent of the aggregate assessed valuation of real property in the CNMI, and further prohibits public indebtedness for operating expenses of the CNMI government. House Legislative Initiative 17-1 proposes to add a new Section 10 which would permit the government to issue pension obligation bonds, and would exempt these bonds from the public indebtedness limitations provided in Section 4.

In other words, if this initiative passes, the government would be authorized to issue pension obligation bonds that exceed ten percent of the aggregate assessed valuation of real property in the commonwealth, and would in effect be borrowing for operations. The only limitation on public indebtedness provided in this initiative is that the cumulative amount of pension obligation bonds issued “shall not exceed the Commonwealth’s actuarially determined unfunded accrued liability to the Retirement Fund.”

As of 2008, that amount already exceeded a staggering half a billion dollars. It could grow, for any number of reasons: the legislature could pass more laws increasing retirement benefits without identifying a source of funding; the stock markets could tank; the government could fail to pay employer contributions; the government could fail to pay the ever-growing $300 million judgment awarded to the Fund, etc. The initiative provides no numerical ceiling on what the amount of borrowing could be.

No safeguards

Proponents of the pension obligation initiative have claimed that the initiative is written with certain “safeguards” in place to ensure that pension obligation bonds would only be issued “when the time is right” and pursuant to feasibility studies and expert advice. They have also presented POBs as just “one possible option” out of many options being explored to address the government’s obligations to the Fund.

First, no such purported safeguards actually exist in the initiative. The findings of the initiative suggest that such a feasibility study should be done prior to the issuance of any pension obligation bond, but there is nothing in the actual binding text of the initiative that requires that such a study would be done. There is also nothing in the initiative that would require the government to heed the expert advice against the issuance of pension obligation bonds. Indeed, our government has a history of ignoring the advice and warnings of experts, having failed for years to pay employer contributions on time and at the recommended actuarial rate. The $300 million judgment awarded to the Fund in Superior Court nearly a year and a half ago, of which not a single penny has been paid to date, is directly the result of our government’s refusal to abide by expert studies and advice.

Other safeguards are missing from House Legislative Initiative 17-1. For example, nothing would prohibit the legislature from increasing retirement benefits either before or after the issuance of a pension obligation bond. (House Legislative Initiative 16-13, which is also on the ballot this year, proposes to restrict the legislature’s ability to increase retirement benefits before the retirement system is fully funded, but its passage is uncertain since the question is vague and poorly constructed.) In addition, after the issuance of pension obligation bonds and the infusion of money into the Fund, nothing in this initiative would prohibit future government borrowing or so-called “investments” from the Fund to satisfy other government obligations, as the government has done in recent years with both the Retirement Fund and Marianas Public Lands Trust.

Despite proponents' claims to the contrary, it is difficult to escape the impression that the pension obligation bond is the only option that the administration and Fund officials are banking on. While taxpayer dollars have been spent on a heavily one-sided “public education” campaign to convince voters to pass the pension obligation bond initiative, no payments whatsoever have been made toward the $300 million judgment awarded to the Fund, and efforts to come up with a sensible payment plan or to pursue any of the numerous revenue streams and assets previously identified by Fund officials and concerned citizens seem to have been all but scrapped.

Dismissive, vague, and misleading claims

The POB proponents’ responses to questions about how in the world our bankrupt CNMI government could possibly take on new, massive, and inflexible debt, have generally been dismissive (“Who cares how the government pays off its debt?”), vague (“Experts will help the government figure that out.”), or misleading (“This is not new debt.”).

Without presenting any solid basis for their assurances, POB proponents have promised that no new taxes would be introduced in order to make bond payments, and suggested that the government’s employer contributions to the Fund would be a sufficient source of payment for bond obligations. They have compared issuing a pension obligation bond to refinancing a debt that bears a high interest rate with one that bears a lower interest rate, and have claimed that the CNMI could realize cost savings. But as actuarial consultants Gabriel, Roeder, Smith and Company have noted, “[T]he long-term, actual investment performance of the retirement plan is what determines the final savings or cost of issuing the POB … [I]t is not possible to know in advance whether the POB will produce any long-term savings at all.” (“Questions to Consider Before Issuing Pension Obligation Bonds,” GRS Insight, Vol. 4, Issue 1, February 2004).

“Serious risks”

Earlier this year, the Center for State and Local Government Excellence, a nonprofit, nonpartisan research organization, released an issue brief examining the viability of pension obligation bonds. The authors of the brief, all professors and researchers in management sciences, public affairs, and retirement studies, noted “serious risks” associated with issuing POBs, including financial risk (if the cost of borrowing exceeds investment returns over the duration of the debt), the inflexibility of the debt that would be incurred and the required annual payments, and political temptations to increase retirement benefits upon issuance of POBs, even if underfunding still exists. The authors also analyzed rates of return on POBs issued since 1992, and found that by mid-2009 “most POBs have been a net drain on government revenues” and that “POBs could well leave plan sponsors worse off than they were before they issued the POB.” They concluded that although POBs could theoretically be a useful tool for fiscally healthy governments with well-funded pension plans, in practice “the governments that issue POBs are those facing the greatest fiscal stress that are the least able to shoulder the additional risks from a POB.” (“Pension Obligation Bonds: Financial Crisis Exposes Risks,” Munnel et al., January 2010.)

There is no question that our government is facing severe fiscal stress. Even the proponents of House Legislative Initiative 17-1 acknowledge that. Our government has a long history of deferring payments and neglecting its obligations to the Retirement Fund, CUC, vendors, Worker’s Compensation, insurance, civil service employees’ merit increases, and numerous judgments against the government, not least of which is the $300 million judgment awarded to the Fund. Our government has also technically defaulted or come close to default on at least two of its bond obligations (the airport and seaport improvement bonds), after years of failure to satisfy revenue-to-bond payment ratio requirements and to issue timely financial reports. In addition, we face the largest fiscal deficit in the history of the CNMI: as of September 2009, that figure stood at $300.8 million, and has only grown since then.

Can we afford more debt?

Whether we are government retirees or not, we all should care about the costly ramifications of changing our constitution in order to allow our government to borrow far beyond its means. We should recognize that pension obligation bonds are an extremely risky business, and that our government is in no position now or in the near future to shoulder that risk. We should recognize that the interest payments on these bonds will indeed represent more new debt that we cannot afford. We should recognize that our government has a history of making disastrous fiscal policy decisions that arise at least in part out of a failure to seek expert advice and to ignore expert advice even when it is sought. We should learn from the mistakes of other state and local governments that have issued pension obligation bonds over the past two decades, and today find themselves mired in more debt than before. We should think not just for ourselves but for future generations as well.

Before we vote on House Legislative Initiative 17-1, we should ask ourselves if there is any evidence at all to suggest that our government is in a position now, or in the near future, to be incurring more debt. Limits on public indebtedness were enshrined in our Constitution for good reason. During this time of unprecedented fiscal crisis created by years of runaway government spending and recklessness, we should be looking for ways to strengthen those safeguards, not take them away. Given that our government has so abjectly failed to exercise sound fiscal discipline, or to undertake obvious and sensible measures to streamline government operations, improve accountability, and enforce existing laws that generate revenue, can we really afford to allow ourselves to be dragged into more debt? We have already borrowed ourselves into insolvency, and critical public services are now in jeopardy. Taking on more public debt and more investment risks in order to attempt to mask our fiscal crisis would be akin to a gambler who has lost all his money, maxed out all his credit cards, and seeks to borrow more money so he can try to recover what he has lost. We all know how that story ends.

/s/ Tina Sablan and Glen Hunter

Fina Sisu

PLEASE SIGN PETITION TO PRESIDENT OBAMA

Please sign our petition to provide protection to the CNMI alien workers!

DOWNLOAD PETITION HERE OR SIGN ONLINE



We, the undersigned petitioners, ask you to take administrative action to extend protections to the 16,000 legal aliens residing in the U.S. Commonwealth of the Northern Mariana Islands (CNMI). Until such time as a more permanent status is provided by the U.S. Congress, or by the U.S. Department of Homeland Security, U.S. Department of State, and U.S. Department of Labor, please grant these legal aliens parole-in-place status with authorization to seek employment, and provide that parole-in-place status shall qualify them for employment-based visa applications. Mr. President, each of these legal aliens is part of the U.S. Social Security system. Each understands U.S. industry standards. Each understands U.S. workplace safety standards. Each understands U.S. fair labor standards.

For more than twenty years and until the application of federal immigration law to the islands in November 2009, the CNMI was allowed to manage a guest worker program that permitted alien workers to renew their employment contracts and live in the CNMI year after year, but denied them any opportunity to adjust to permanent status. Over the years many legal aliens built quality lives in the islands, performing their jobs honorably and with distinction, contributing to the economy and community, and building homes and families. They established roots in the CNMI that grew deeper and stronger each year that their stay was extended, but their status as temporary guest workers remained the same.

The CNMI guest worker program effectively ended with the enactment of the Consolidated Natural Resources Act (CNRA) of 2008, U.S.P.L. 110-229, which applied federal immigration law to the CNMI. The fate of legal aliens still present in the CNMI remains unclear, however, and today they live in fear of removal from the CNMI because they lack a permanent U.S. status. Many have neither job prospects nor support systems in the countries they left so long ago. Their children, most of whom are American citizens, stay awake at night anxiously contemplating the fate of their parents and the future of their families. They worry about being exiled to foreign countries where they cannot speak the language and where they may face a poorer quality of life.

Mr. President, the legal aliens of the CNMI have a special and urgent situation. Under current U.S. Department of Homeland Security (DHS) policies, none of the CNMI's legal aliens qualifies for employment-based visas and the pathway to naturalization provided under such visas. Though DHS is mandated by the CNRA to create a transitional worker visa program for the CNMI, that worker visa program has not yet been established. It is unclear when DHS will finally begin to issue transitional worker visas, and in the meantime the absence of this program is creating severe stress for the CNMI's legal aliens and their families, as well as great uncertainty and instability for small businesses and investors.

Without the transitional worker visa program mandated by the CNRA, none of the CNMI's legal alien workers can begin the process for obtaining an employment-based visa. Moreover, the present employment-based H and L visas do not provide relief to the CNMI's legal alien workers because the jobs they occupy are not temporary as defined in the regulations for these visas. The EB visas, which provide for petitioning for permanent resident status and, eventually, naturalization, cannot be applied for without U.S. immigration status.

While we understand that permanent status and a pathway to citizenship for legal aliens in the CNMI may be included in future national comprehensive immigration reform legislation, we plead with you not to wait to grant relief. A U.S. Department of Homeland Security Memo to USCIS Director Alejandro N. Mayorkas has outlined administrative relief options that could be exercised in the absence of comprehensive immigration reform legislation in order to promote family unity, foster economic growth, and remove the threat of removal for certain individuals and groups present in the United States without authorization. According to the memo, "USCIS can extend benefits and/or protections to many individuals and groups by issuing new guidance and regulations, exercising discretion with regard to parole-in-place, deferred action and the issuance of Notices to Appear (NTA), and adopting significant process improvements."

We appeal to you, Mr. President, to recognize that the unique and urgent needs of the CNMI's legal, documented aliens need not, and should not, be delayed by ongoing partisan politics and a raging debate over undocumented workers in the United States. It is within your power now to provide protection to legal aliens who have dedicated their lives to building and developing this U.S. Commonwealth. Administrative actions to grant the CNMI's legal aliens parole-in-place status, employment authorization, and eligibility to apply for employment-based visas, would give peace of mind to 16,000 members of the CNMI community, keep families intact, and provide businesses and investors with the stable labor pool they need to help the CNMI economy recover.

Moreover, these administrative actions to extend protections to the CNMI's legal alien workers would provide a measure of justice for the thousands of people who have been cheated of their wages, victimized by illegal recruiters, scammers, and unscrupulous employers, and suffered a range of labor, civil, and human rights abuses in the CNMI. In 2008 the Office of the Federal Ombudsman in Saipan verified a total of $6.1 million in unpaid judgments that are still owed to thousands of alien workers. While the cheated workers will never receive their back wages or compensation for the abuses that they suffered while working on U.S. soil, you can alleviate their suffering now by exercising your administrative powers to protect them.

Mr. President, regarding comprehensive immigration reform you said, "Our task then is to make our national laws actually work - to shape a system that reflects our values as a nation of laws and a nation of immigrants. And that means being honest about the problem, and getting past the false debates that divide the country rather than bring it together."

Mr. President, please restore the American dream to the 16,000 legal aliens who have made this U.S. Commonwealth their home. Please take administrative action through the U.S. Department of Homeland Security, U.S. Department of State and U.S. Department of Labor and extend benefits and protections to these valuable, law-abiding, and contributing members of the CNMI community, until a more permanent status can be provided to them.

Thank you.

Respectfully submitted,

(Your name here)

Not Getting the Message

October 29, 2010

Fridays I always look forward to Zaldy Dandan's editorials. Send a message to this administration and No one else to blame couldn't get any more accurate. He writes:

"...We look around and we see an economy in shambles, abuse of power, corruption, incompetence, mismanagement and a rising crime rate. And we’re told it’s not the CNMI’s fault. It’s the feds’. Of course.

But it has been 32 long years since the establishment of the commonwealth so why do some local politicians still sound like they’re running for office in the Trust Territory era? The islands have changed and continue to change before our very eyes, but some politicians are still stuck in the past and fighting “battles” that have already been fought.

...The CNMI is where it is now because of the choices it made. It is time for the commonwealth to take full responsibility for the mess it has created. And no, voters. You can’t blame your officials past and present. You voted for them. Again and again. And even though you complain now about the current set of leadership on Capital Hill, you will re-elect and even “promote” most of them to higher office."

Has the CNMI become an out-of-control Wild West of lawlessness, corruption and deceit?  It sure looks that way. It will only get worse if people continue to support and re-elect and re-elect and re-elect the current Administration and the candidates that they back.

Despite the work of the MVA and CNMI agencies, tourists and investors who research the CNMI, may just reject the islands as a destination.  The mafia-style government is not going to attract retirees either. In fact, there could be an exodus of residents who seek higher paying jobs in places with quality healthcare and less crime.  The Administration's campaign to keep workers permanently disenfranchised and under their thumb could also result in the loss of many long-term professionals and skilled workers who may decide to leave for the U.S., Australia, Canada and other more secure places that offer not only a job, but a future.

The Attorney General is a puppet of the governor as massage-gate, gun-gate, parole-gate and election-gate have shown.  Expect no stop to corruption, special interest contracts, nepotism within the government offices, illegal campaign activities, abuse of power, or crimes committed under the color of the law as long as Buckingham is AG.

Eleven days ago a Chinese national was beaten by a CNMI police officer.  The CNMI Department of Public Safety has not even issued a statement releasing the name of the offending officer/s  and no arrest/s has been made. This is not a Department of Public "Safety" at all.  The governor reinstated his hand-picked Covenant Party bully, Ambrosio Ogumoro to perform his work there.  Grievances against Ogumoro blame him for "harassment, abuse of authority and creating a hostile work environment."

The CNMI squandered it's limited funds on lobbying, suing the federal government, hiring special advisors and filling unnecessary government positions with family members and political allies.  As a result, people's lives are at risk because of a lack of money for essential services.  The in-debt CNMI government owes the travel agencies over $180,000, and they are refusing to issue any more tickets for off-island medical referrals until they are paid. Anyone who has or develops a serious health issue or meets a serious accident that requires immediate off-island care, may not survive if they can't raise the funds for airfare and medical expenses.

When will Finance get the money to pay the travel agencies? Where will all the money that is need come from? The line for those waiting to be paid by the CNMI government is long and growing:

• Tax payers want their tax refunds that were promised months ago. 
• The CNMI government owes $8.5 million for the marina.
• The CNMI government  Retirement Fund liability is at $545.5 million.
• MVA owes travel firms over $2 million.
• The municipal governments of Tinian and Rota cannot address DEQ orders to comply with landfill requirements because they lack the millions of dollars it will take to meet regulations. The DEQ has also charged the CNMI government with fines for the Marpi dump's noncompliance.
• CUC lacks funds to meet DEQ Stipulated Orders.
• CNMI sons and daughters await their scholarship checks to complete their education.
• The AG is spending government money on a private counsel to defend himself against election law violations.
• The CNMI government failed to pay the government employees' contribution to the Workers Compensation Commission.
• The CNMI government health insurance program owes over $4 million to health services providers in the CNMI, Guam, and U.S.
• In May 2010 the CNMI government had $3.8 million in unpaid CUC accounts. Who knows what it is now.

Feel free to add to the list above.

Cha-ching!  The coffers are empty, and more unpaid bills are piling up.  No wonder the Secretary of Finance retired.

Payless paydays are the norm, cheating nurses of their wages is common practice, the number of tourists being robbed has increased, and thousands of government employees have 16-hour work cuts per pay period.


Zaldy wrote in his editorial No one else to blame:

The CNMI’s problems can only be solved in the CNMI not in D.C. The feds and your congressional delegate could help you get some of the tools you need to get out of this financial wreck. But it’s still up to you, people of the CNMI, to use these tools and use them wisely.

Clearly, you can’t trust politicians who tell you it’s not your fault. It is your fault. That’s the bad news. But the good news is because you’re in charge, you can do better. You can improve. You can be the change you want to see in this beautiful community.

One last note: Nothing in the CNMI or U.S. Constitution says that a lawmaker should “work” with the governor. Come on CNMI voters. Do you really want your congressional delegate working with the governor — like the way he has been working with the Legislature? How’s that working for you so far?

From Send a message to this administration, Zaldy wrote:

This administration is a colossal failure by any standard. Its mismanagement and corruption have brought the CNMI to its knees, but it is skillful and ruthless in exercising power and now it wants voters to support its candidate, or at least anyone but the incumbent congressman who has the audacity to work for you, the people, and not for the governor.

Voters, on Tuesday, do the CNMI a favor by reminding yourself that you’re supposed to elect a delegate and not a puppet to the U.S. Congress.

Exactly!

Prayer Vigil November 9, 2010

October 28, 2010

Former Rep. Tina Sablan has joined those who are inviting all residents to join the prayer vigil November 9th at American Memorial Park. She also has shown her public support for the petition to President Barack Obama.

From the Marinas Variety:

“The purpose of the vigil and the petition is to appeal to President Obama to take administrative action to extend parole-in-place protection to the legal aliens who have been part of our economy, our families, and our community for many years,” she told Variety in an e-mail.

She said while “we continue to push for Congress to pass legislation that will grant these legal aliens a pathway to more permanent status, until that happens, executive action can be taken now to stabilize our workforce and keep our families intact.”

She urged community members to sign the petition requesting Obama to extend protections to the legal aliens in the CNMI.

DOWNLOAD PETITION HERE OR SIGN ONLINE

Election Complaints Continue

October 28, 2010

Two candidates have filed more election complaints.  U.S. Congressman Gregorio Kilili Sablan said that untruthful ads against him were placed in CNMI newspapers.  The individual or individuals who paid for the ads were not identified.  This is a violation of CNMI election law which prohibits “publications intended to defeat a candidate by reflecting his or her personal character or political actions without proper identification."

The CNMI Election Reform Act of 2000 requires that ads must include "(a) the name of the chairman and secretary or the names of two officers or the political party of other organization issuing it; and (b) the name and residence of the person responsible therefore."

The Marianas Variety reported:

Sablan, a former election commission executive director, said those who placed the ads must provide the names of the chairman and secretary or the names of two officers of the political party or organization responsible for the ads.

Sablan asked the election commission to “expeditiously” investigate the matter.

Variety learned that the ads were placed by supporters of the ruling Covenant Party.

Why didn't the newspaper/s that published the ads refuse them for not complying with the law? No newspaper in the states would have allowed a full-page attack ad to be published without the proper identification of the individual/s.

KSPN2 News also covered the story, showing the ad, which disclosed only that it was paid for by the CNMI Descents for Self-Government and Indigenous Rights. This is the Covenant Party backers that signed on to defend the anti-federalization lawsuit. The group is headed by the former DOC Commissioner, Delores San Nicolas of massage-gate fame.  The group's spokesperson is felon Oscar Rasa.  Rose T. Ada-Hocog is the secretary. They are all anti-federalization Covenant Party members.

Rasa claimed that the issue has been "addressed." According to the Saipan Tribune, that is not the case:

Sablan asked the Commonwealth Election Commission to investigate the matter to confirm that a violation has occurred and refer the matter to the attorney general for criminal prosecution.

If any of the candidates are found to have been involved in the violation, Sablan said their name should be struck from the ballot or disqualified from office.

Who actually paid for this full page ad? The Covenant Party or the Descents group?

KSPN reported that AAG Meahgan Hassel–Shearer received five complaints about the ad.

Be sure to read Ed Propst's letter to the editor denouncing the ads.

Democratic candidate Jesse Borja expressed concerns about the early voting. The Saipan Tribune quoted him:

“It is imperative that the CEC notify the candidates and the general public about how the Election Commission intends to identify, process and remedy possible improperly cast early votes,” said Borja.

What a mess.

Political Activity by Federal Officials

October 27, 2010

This is Part Three of a series of editorials on federal election law.

by ALICIA G. LIMTIACO - U.S. ATTORNEY FOR GUAM AND THE NMI

“[While it is] the right of any officer [federal employee] to give his vote at elections as a qualified citizen . . . it is expected that he will not attempt to influence the votes of others nor take any part in the business of electioneering, that being deemed inconsistent with the spirit of the Constitution. . . .”
—Thomas Jefferson

The United States was still mired in the Great Depression. President Franklin Roosevelt had signed an executive order creating the Work Projects Administration to create jobs on public works projects around the country. But by 1939, widespread allegations that WPA officials were using their positions for partisan political advantage in Congressional elections led New Mexico Senator Carl Hatch to introduce An Act to Prevent Pernicious Political Activities, now known as the Hatch Act.

In Part Two, I wrote about the parts of the Hatch Act that prohibit intimidating federal employees to secure campaign contributions, and coercion of federal employees to engage in political activity. Promising employment or benefits in exchange for political support —or taking jobs or benefits away in retaliation for withholding such support — is also a crime. In today’s column, we will cover the Hatch Act prohibitions on political campaign activities by public officials.

Who is covered?

The Hatch Act applies to most Federal employees and officials, but it also covers State and local government employees who perform duties in connection with an activity financed in whole or in part by federal funds, even if the employee’s salary is not federally funded. For purposes of the law, the term “state” includes both the CNMI and Guam. Examples of types of programs that frequently receive Federal assistance include public health, education, housing, labor and industry training, public works and conservation, civil defense, transportation, anti-poverty and law enforcement programs. Most agencies of the CNMI and Guam governments receive Federal aid. A covered employee remains subject to the restrictions of the Hatch Act, even when on annual leave, sick leave, leave without pay, administrative leave or furlough.

In addition, employees of private, nonprofit organizations that plan, develop and coordinate Federal Head Start, Community Service Block Grant and economic opportunity programs are also considered covered employees under the Hatch Act.

State and local employees-Prohibited activities

Covered State and local employees may NOT:

• Be candidates for public office in a partisan election. A partisan election is one in which a candidate is running as a representative of a political party.

• Use their position or authority to interfere with or affect the results of a nomination or election. For example, a covered employee may not ask an employee he or she supervises to volunteer for a political party or candidate, or advise employees that they may purchase tickets to a fund-raising event. Targeting subordinates for such “requests” is seen as inherently coercive, because the subordinate might reasonably fear to deny such a request by his or her supervisor.

• Directly or indirectly coerce, command, advise or suggest that another State or local employee — particularly a subordinate —contribute anything of value to a party or candidate for political purposes. For example, it would be a violation for a covered employee to advise his subordinates to take part in any partisan political activity, or contribute money, food, beverages, or anything else of value, to a political candidate or party. Again, subordinates might feel they have no choice when a request is made by their supervisor, so supervisors must avoid making such requests.

State and local employees-Allowable activities

Covered State or local employees MAY:

• Vote for the party or candidate of their choice.

• Be a candidate for public office in a nonpartisan election, such as for a local school board.

• Hold office in a political party, club or organization.

• Be appointed to fill a vacancy for an elective office.

• Actively campaign for candidates for office in partisan or nonpartisan elections (on their own time, not during work hours, and not at the government work site).

• Contribute money to political parties or candidates.

• Attend political rallies, meetings or fund-raising events.

Of course, all employees remain subject to the laws of the State or local government they live and work in, as well as regulations or policies of their employing agency.

Anyone with information concerning possible election fraud should contact the Federal Bureau of Investigation and ask to speak with the FBI’s Election Crimes Coordinator, at 322-6934, or AUSA Jim Benedetto, the District Election Officer for the CNMI, at the United States Attorney’s Office in Saipan at 236-2980. All calls are confidential, and any person who retaliates against a witness who has given information to Federal law enforcement authorities is subject to serious criminal penalties.

Those who wish to file a complaint directly with the U.S. Department of Justice’s Office of Special Counsel may also go to: http://osc.gov/haFilingComplaint.htm for instructions on how to file form OSC-13.
______________________________________

See the ELECTION GATE POSTS for alleged violations of  CNMI and Federal election laws in the 2010 U.S. House Delegate Race.

Conflicts of Interest?

October 27, 2010

Earlier this year Management Analysis, Inc. was awarded a $300,000 contract to conduct a desk audit for the CNMI government.  The government was billed for $254,459.12 to conduct desks audits of the CNMI Department of Community and Cultural Affairs and the Department of Public Safety.

The grant, funded by the U.S. Department of Interior, was questioned because it was discovered that the Governor's former lobbyist and "representative" in Washington DC, Lynn Knight is employed as a project manager by MAI.


The Saipan Tribune revealed that a June 2010 sole-source contract for Lynn Knight in the amount of $48,000 was penned by the governor to pay her for “public relations and administrative support in Washington, D.C.”  The governor's press secretary, Angel Demapan claims that  no "notice to proceed has been issued." The contract was set to expire December 31, 2010.

From the Tribune:

Had Knight billed the government for work done covered by the contract, Demapan said the money would have come from the governor's office account.

“This is not federally funded. The funding would have come from the local government,” he said.

The governor, in his June 2 memo justifying the proposed contract for Knight, said that pursuant to Section 70-30.3-225 (a)(7), sole-source procurement is permitted “for policy consultants of the governor, lieutenant governor, and presiding officers of the Legislature.”

“In addition to this, the Executive Branch does not maintain an office in Washington, D.C. and finds that having a liaison will help bridge the gap between the local and national governments,” Fitial told the director of the Procurement and Supply Division in a June 22 memo.

The governor said Knight's expertise as a professional business executive and a long-time resident of the CNMI “will serve as effective and instrumental tools in her ability to perform her duties pursuant to the proposed contract while in Washington, D.C. As the expenditure authority, I hereby determine that entering into this contract with Ms. Knight will be highly beneficial to the Commonwealth,” Fitial said.

This is so ridiculous. The CNMI is represented by U.S. Congressman Gregorio Kilili Sablan in Washington! This magnifies the gap between Fitial and anyone who does not push his far out agenda. He may want to learn to play nice with those in Congress and other federal officials.

Meanwhile KSPN2 reports that the DOI stated that there is nothing irregular with the MAI contract, but the unused money should be returned to the OIA.   Questions of conflict will remain as long as Knight continues to work for both MAI and the governor.

Voting Concerns

Candidates for the U.S. Delegate seat are raising concerns about early voting irregularities.  Republican candidate Juan Babuata said he received complaints of voter intimidation, which he turned over to the FBI. Democratic candidate Jesus Borja said that some voters are exploiting early voting, and U.S. Congressman Gregorio Kilili Sablan echoed his sentiments.

On the other hand, Covenant candidate Joseph Camacho claims that other candidates, "are not taking advantage of the early voting process and they should talk to their supporters."

Congressman Sablan said, "The law was not created for candidates."

Over 1,000 people have voted in early voting. In the CNMI, there are only 6 reasons to vote early:
1. the conduct of business;
2. the necessity of travel; serving in the U.S. military;
3. receiving treatment at a medical institution;
4. government representation; or
5. accompanying a member of the household who is engaged in any of the activities listed above.

Covenant Party Encourage Breaking Federal Law


There is a campaign ad on KSPN2 new that was broadcast on October 27, 2010 that advocates breaking federal law.  The Covenant Party states that  citizens should be given job preference over aliens for jobs. This is illegal!

The ad states: "The Covenant Party is working hard to ...enforce our laws that give our citizens preference... We can make job preference work."

Candidate Camacho repeated the same line before the Saipan Chamber of Commerce earlier this month.

Here is what federal law says regarding U.S. citizen job preference:

Title VII

Title VII prohibits not only intentional discrimination, but also practices that have the effect of discriminating against individuals because of their race, color, national origin, religion, or sex.

National Origin Discrimination

It is illegal to discriminate against an individual because of birthplace, ancestry, culture, or linguistic characteristics common to a specific ethnic group.

A rule requiring that employees speak only English on the job may violate Title VII unless an employer shows that the requirement is necessary for conducting business. If the employer believes such a rule is necessary, employees must be informed when English is required and the consequences for violating the rule.

The Immigration Reform and Control Act (IRCA) of 1986 requires employers to assure that employees hired are legally authorized to work in the U.S. However, an employer who requests employment verification only for individuals of a particular national origin, or individuals who appear to be or sound foreign, may violate both Title VII and IRCA; verification must be obtained from all applicants and employees.

Employers who impose citizenship requirements or give preferences to U.S. citizens in hiring or employment opportunities also may violate IRCA.

Additional information about IRCA may be obtained from the Office of Special Counsel for Immigration-Related Unfair Employment Practices at 1-800-255-7688 (voice), 1-800-237-2515 (TTY for employees/applicants) or 1-800-362-2735 (TTY for employers) or at http://www.usdoj.gov/crt/osc.

I thought this candidate was an attorney.

Another Complaint Against DPS Deputy Commissioner Ogumoro
The conflicts of interest continue at DPS.

A complaint was filed against Deputy Commissioner Ogumoro saying that he violated the competitive selection process by refusing to relieve temporary Driver License Technician Connie Lynn Iglecias, so that Lupe Blas Repeki, who had been selected to fill the position permanently could fill the position.

Connie Lyn Manglona Iglecias is the daughter of Police Officer Katherine Manglona, who is Ogumoro’s common-law wife.

The position in question is federally funded.

The Marianas Variety stated:

“For the benefit of all of DPS and its employees, Repeki also believes that DPS should institute immediate corrective action to force compliance by Ogumoro and Tudela with the CNMI Personnel Service System Rules and Regulations and other binding federal and commonwealth laws,” the complaint said.

Repeki is also asking for protection from Ogumoro’s retaliation.

Sgt. James C. Deleon Guerrero earlier filed a complaint against Ogumoro for non-compliance with the CNMI Personnel Service System Rules and Regulations.

Deleon Guerrero also accused Ogumoro of harassment, abuse of authority and creating a hostile work environment.

There should be federal auditors based permanently in the CNMI.

I invite all of the alien workers, their families and supporters to attend the upcoming prayer vigil on Tuesday, November 9, 2010 at American Memorial Park at 6:00pm, and to sign the petition.

DOWNLOAD PETITION HERE OR SIGN ONLINE:

CNMI Abuses

October 26, 2010

It's still Bullying Prevention Month. It seems that some did not get the memo.

DPS Commissioner Santiago Tudela admitted that a Saipan police officer attacked a Chinese alien worker who was mistaken for an "ice" dealer.

We all know that police officers should be enforcing the laws, not breaking them.

From yesterday's  Marianas Variety article, I get the impression that the DPS will try to justify the attack by claiming that the victim was "struggling."

KSPN2 news covered the story with a graphic report showing the pool of blood that the victim after his head was smashed with the officer's gun.  They reported:

A Chinese national says he was wrongfully arrested and beaten by a police officer. Wang Jin Dong says on October 18th at around 9:30 pm, he was at his apartment when two police officers, one male and one female, shined a flashlight at him and yelled for him to get down on the ground. Dong says the male officer hit him on the head with the butt of his hand gun and then kicked and handcuffed him. He says the officer searched his wallet for his identification. Then he was shown a picture of a suspect, a wanted ice dealer by the name of Junding Qui, whom police now have in custody. Dong says a while later he was uncuffed, and was brought to the hospital in an ambulance. We’re told DPS, the AG's office, and the FBI have been asked to step in and investigate. Police have not released the names of the police officers involved.

Today the Marianas Variety reports that a DPS detective, Detective Jesse Dubrall resigned Friday just five days after the October 18th assault. On Monday he reported to work at the Office of the Public Auditor.  DPS spokesperson, Thomas A. Blas, Jr. refused to say whether or not Dubrall was the assailant.  If he is responsible for the violent attack, he should have gone from the DPS to jail, not to a new position.

From the Variety:

On Oct. 18, the Superior Court issued a search and arrest warrant against Junding Qiu, who was wanted by the police for “ice” trafficking, at an apartment complex near the LPG gas company in As Lito.

Jing Dong Wang resides at an As Lito apartment.

In his affidavit of probable cause, Detective Roque C. Camacho said Dubrall and another detective were at the back of the target apartment complex, monitoring Qiu’s illegal activities.

After her husband was beaten up, Wang’s wife said a police officer showed her a picture of Junding Qiu, and asked if she knew the suspect. 

She said she didn’t know Qui.

It's been over a week since the victim filed police complaints for assault and battery and assault with a deadly weapon, and still no one from the DPS has made a statement regarding the attack.  Of course, they know who is responsible. After all, several officers were on the scene.  The FBI and US Attorney should be investigating this case.

Meanwhile, former police officer Florencio Richards was indicted in federal court after being charged with drug conspiracy, distribution of a controlled substance, use of a firearm during and in relation to a drug trafficking crime, and possession of a firearm by a prohibited person.

He was previously indicted in Superior Court for the same charges, but was out on bail apparently continuing his drug abuse.  He is now being held without bail.   It seems that the federal law enforcement officials know how to enforce the law.

OPA Investigating Ada ARRA Contract Abuse
The Saipan Tribune reports that the Office of the Public Auditor is investigating the questionable sole-source contract awarded to former Secretary of Commerce Michael Ada to oversee the ARRA funds.  Not only was he already performing the services under the Department of Commerce, but he did not even have a license for his business, Integrated Professional Services, LLC at the time the contract was awarded.

The Tribune revealed that Ada's IPS business partner is Jose Padilla who is a former executive at Red Rock LLC.  Red Rock was awarded an $50,000 ARRA contract by Ada.  Padilla also was awarded a contract for energy saving lights at the library, the CHC, and legislative buildings.

The partnership with Padilla adds to the mix of alleged violations including violations of the Government Ethics Act of 1992.

The governor's press secretary, Angel Demapan claims that the Government Ethics Law of 1992 does not apply to this contract.

Voting Abuses

Election-gate continues as the Covenant Party has set up a tent outside an early voting site on Saipan. About 1,000 voters have already voted in the early voting and Elections Commission Executive Director Robert Guerrero is questioning the large number.

From the Marianas Variety:

The criteria for early voting as provided in Public Law 17-16 include business activity, necessity of travel, military and merchant marine service, medical treatment, government representation and the ties to those doing these.

But the number of people lining up at the election office to vote early has cast doubt on their eligibility to vote early.

Over the weekend, many of these voters were seen filling out application forms they received from people in the tent set up by the Covenant Party across from the election office.

Guerrero said they received reports that many voters were getting forms from Covenant Party supporters.

He said they immediately asked the party’s supporters to stop doing it.

Guerrero admitted that they did not anticipate that there would be a lot of early voters.

The Covenant Party members are handing out early voter applications to their supporters.  The CNMI early voting is limited to those voters who are unable to vote on election day.  Watch KSPN2 news to hear some early voters struggling to explain why they are voting early.

The ballot boxes are being held by the Rota and Tinian DPS and on Saipan by the Department of Corrections, which is headed by Fitial's pal, Ramon Mafnas.

The Saipan Tribune reported:

For each island, the election commission deployed one poll worker for the early voting process to be assisted by a police officer.

The board of election commission certified three polling places for the early voting process: Rota DPS in Songsong Village; Tinian DPS in San Jose; and the election commission office in Susupe.

Pursuant to Public Law 17-11, the early voting period will end on Nov. 1 and all polling sites will open at 8am through 4pm each day inclusive of weekends.

Message to the Guest Workers

October 25, 2010

Dear Friends:

I am asking you to attend the Prayer Vigil and Petition Drive on November 9, 2010 to be held at American Memorial Park at 6:00pm.  It is sponsored by the United Workers Movement-NMI.
Workers, residents, religious leaders and ethnic groups are participating in the event.

Some have questioned the wisdom of having "another" prayer vigil saying that it "does nothing to strengthen our cause in Washington."  This is not true. Nothing worth fighting for comes easily. It takes persistence, passion and determination to keep the cause of the guest workers in the spotlight, especially because the CNMI is so far from Washington DC.  When people gather in Saipan, Rota and Tinian to show solidarity for their cause, the policy makers in Washington get the message! I know this for a fact because I communicate with the federal officials.

Some are saying that rallies, vigils and gatherings of guest workers are "offensive" to the local population.  I find it difficult to believe that anyone would object to a peaceful gathering of the alien workers who make up a vital and contributing segment of the CNMI community.  Among the very few rights that the CNMI disenfranchised foreign workers have are the constitutional rights of freedom of speech and freedom to assemble.  I urge the alien workers to ignore the nay-sayers and exercise your constitutional rights.

Last evening I caught a clip of President Obama's speech at the University of Minnesota.  He could have been speaking to the CNMI guest workers. He said:

"Don’t let them tell you that change isn’t possible. It’s just hard, that’s all... 

You know, this country was founded on a tough, difficult idea — 13 colonies deciding to break off from the most powerful empire on Earth, and then drafting a document — a Declaration of Independence that embodied ideas that had never been tried before: “We hold these truths to be self-evident that all men are created equal, endowed by our Creator with certain inalienable rights; that among these are life, liberty, and the pursuit of happiness.” That’s not an easy idea. And it had to be fought for, inch by inch, year by year.

Slowly — slaves were freed. Slowly — women got the right to vote. Slowly — workers got the right to organize.

Imagine if our grandparents and our great-grandparents and our great-great-grandparents had said, "Oh, this is too hard. Folks are saying mean things about us. I’m not sure if we can ever get to the promised land." We wouldn’t be here today. But they understood that we are tested when we stand up in the face of difficulty; when we stand up in the face of uncertainty; when we’re unafraid to push forward. Because we know we’re doing it not just for ourselves, but for future generations.  

That’s how we came through war and depression. That’s why we have civil rights and women’s rights and workers’ rights.  That’s why we’ve been able to clean up our air and clean up our water.  That’s why we’ve been able to end combat operations in one war.

The journey we began together was never about putting me in the White House — it was about building a movement for change that endures. It’s about understanding that in America anything is possible if we’re willing to work for it and fight for it, and most of all, believe in it.

So I need you to keep fighting. I need you to keep working. And I need you to keep believing.

We should heed President Obama's message.  We need to keep fighting, keep working, keep organizing, keep gathering, keep speaking out, keep marching, keep rallying and keep believing!  No one, anywhere will ever embrace our message if we stop talking, if we retreat, if we are intimidated, or if we listen to those who are trying to silence the voices of the alien workers for their own political and self-serving gains.

Again, I invite all of the alien workers, their families and supporters to attend the prayer vigil and to sign the petition.

DOWNLOAD PETITION HERE OR SIGN ONLINE.

Undercover

October 24, 2010

It appears that undercover police officers raided the home of an innocent foreign worker suspecting he was an "ice dealer" and at least one officer proceeded to brutally beat the innocent man.  It was said that there are photographs of a pool of blood where his head hit the ground.  Maybe it is not only police officers who are undercover. It appears that the DPS attempted to keep the story of the police brutality undercover too. Until I wrote about this yesterday on this site, there was no report of the attack.

Today the Marianas Variety reported:

The victim, Wang Jin Dong, said he was on the terrace of their barracks on the second floor of a building in As Lito when two men from the ground shouted at him to “stop,” while aiming their flashlights at him.

Wang said he had just finished cooking dinner at about 8 p.m. and was about to go to his room when another male individual armed with a handgun approached and ordered him “to stay put” while pointing a handgun at him.

The armed individual walked behind him, and hit Wang’s head with the handgun, the victim said.

While blood oozed from his head as he lay on the concrete floor, Wang said the same armed individual handcuffed him and kicked his body several times.

Wang said there were other people who entered his room.

He said the armed individual took his wallet and looked for his identification card.

At this point, the victim’s wife arrived, but was prevented from coming near her husband.

Police asked her if she knew the person in the picture shown to her, identified as Junding Qiu, who is wanted by the police for possession and trafficking of “ice.”

She said she didn’t know the suspect.

Wang, who was not taken into custody, was later transported to the Commonwealth Health Center.

If it is true that the men who beat and then handcuffed Jin Dong Wang were, in fact, undercover cops, then let the CNMI Government issue a statement, terminate all officers involved in the assault and cover-up, and pay for Mr. Wang's medical expenses, loss of work, and punitive damages.

I doubt that Mr. Wang will receive justice from the CNMI Department of Public Safety or Office of Attorney General. That is why the FBI, the US Attorney's Office and others have been notified.

Disturbing News

October 23, 2010

This has been a week of disturbing news from the CNMI.

According to CNMI law, the last employer of record is responsible for repatriating a worker.  Yet the Marianas Variety reported that the body of Filipino foreign worker, Camilo D Laoeng remains in the morgue of the Commonwealth Health Center. He apparently suffered a heart attack and died on October 9th while at work. His employer is Matson Consulting.

A Saipan Tribune article states that Friends of the Marianas is raising money to help pay for the repatriation of the body and burial in the Philippines and is requesting community donations. While that is generous, Matson Consulting, said to be owned by William Matson, is responsible for the expenses. The company needs to fulfill its legal obligations and repatriate the body immediately for the sake of the man's family.

Where is the CNMI Department of Labor? Are they too busy contacting ICE officials to recommend deportation of foreigners who are legally in the CNMI to do their job?
__________________________________

Another registered sexual offender has been arrested for rape on Saipan. Someone should track how many violent criminals in the CNMI are pardoned and paroled before their end of their ridiculously lenient sentences.  It seems that every week or two there is another registered sexual offender arrested for sexual assault or rape of a young girl.

Last week Benson John D. Dela Cruz was arrested for the rape of a young woman.  From the Variety:

Court records showed that Dela Cruz was granted parole on Sept. 16, 2009. Dela Cruz was sentenced to six years imprisonment, all suspended except for four years, after he pleaded guilty to the sexual abuse of a minor in the second degree on Feb. 20, 2008.

In the new case against Dela Cruz, Manacop said police received a rape complaint on Tuesday, at about 9:51 a.m., at Kagman High School, where the 18-year-old victim and the mother were met by investigators.

Manacop said the rape incident occurred on the early morning of Oct. 16 within the Capital Hill area.

If he had not been paroled, but had been kept behind bars to serve the entire sentence, another innocent victim could have been spared.

The list of repeat sexual offenders is growing. The CNMI needs to adopt some serious laws that have minimum sentences for violent crimes including sexual assault, rape, murder and domestic violence.  There are far too many repeat offenders and an incredibly high incidence of rape for such a small population.
__________________________________

Aside from rape arrests there has been a rash of arrests involving  drug dealers selling "ice."  Four fell last week. In addition, Francisco Demapan who was arrested for ice In July 2010, was arrested again for possession last week.

Repeat offender Frankie Tudela Mafnas, also an ice dealer was given a lenient sentence of only 22 months in jail  by Judge Ramona Manglona. He has had two previous arrests.

Also, Li Ping Zhou was arrested in September for ice possession and rearrested last week.

The law enforcement officials need to trace the source of this drug if they are going to get a handle on this growing problem. Why not give these drug dealers stiff sentences without parole?
____________________________________

I received a disturbing email stating that a foreign worker was allegedly brutally beaten by a Saipan policeman a few days ago. The foreign worker is still suffering from his injuries. May the brutal cop be fired and may he spend many years behind bars. Thug.

Office of Public Auditor Dropping the Ball?

October 22, 2010

In his editorial, Impunity on Capital Hill, Marianas Variety editor Zaldy Dandan pointed out that legally a CNMI government employee cannot move from a government position to one in the private sector to carry out the same work. That is exactly what former CNMI Commerce Secretary Michael Ada did.

From Zaldy's editorial:

The Government Ethics Act of 1992, in any case, includes a “revolving door” provision that prohibits public officials from taking a position or contract for work in which the public official or employee “participated personally and substantially in the subject matter of the transaction during his term of public legal authority.  With respect to a contract, this prohibition shall be permanent as to that contract.”

This “revolving door” provision is integral to maintaining public trust. The governor’s attorney general may parse these words however he chooses, but the ARRA contract is in violation of the spirit if not the letter of the Government Ethics Act.

By the way

If the former Commerce secretary could not move ARRA grant expenditures forward with the full support of a cadre of professionals in his department and a small army of contractors, why does the administration think he will be more successful as a solo contractor? There is no doubt that the CNMI needs a lot of help in submitting grants and spending federal funds, but this arrangement won’t solve that problem.

Of the $80 million in ARRA grants awarded to the CNMI, only $40 million has been spent, and the clock is ticking. As long as the administration is intent on hiring political cronies instead of professional employees, it will not meet its obligations and the commonwealth will continue to lag in getting badly needed funds where it can do the most good — circulating in the economy.

Zaldy's editorial is spot on. The ARRA contract appears to be in violation of The Government Ethics Act of 1992.  In particular, Section 8432. Restraints on Use of Public Position to Obtain Private Benefit:

(a) A public official or public employee shall not use or attempt to use the public position to obtain private financial gain, contract, employment, license, or other personal or private
advantage, direct or indirect, for the public official or public employee, for a relative, or for an entity in which the public official or employee has a present or potential economic interest. 

(b) A public official or public employee or a former public official or former public employee, shall not disclose or use for the public official or employee, or a former public. official or former public employee's own economic benefit, or that of another person,
confidential information acquired by the public position or employment that is not generally available to the public.

Section 8444 which discusses prohibitions in negotiating for non-government employment may also have been violated. Section 8473 states that CNMI contracts must reference this act and any found to violate it become void.  Furthermore it states:

Any permit, license, ruling determination, or other official action of a Commonwealth
governmental entity applied for or in any other manner sought, obtained or undertaken in violation of any of the provisions of this chapter shall be invalid and without any force or effect whatsoever.

The act charges the OPA with accepting and investigating complaints, but like many CNMI laws, it seems to lacks teeth.



While it seems the OPA should be investigating whether or not there are violations of the Ethics Act in granting a sole-source contract to Ada for the same work he was doing as Commerce Secretary,  the federal government may provide the answer.

The controversy must be investigated not only because the pattern of political favors and corruption is not in the best interest of the public, but also because $100 million in ARRA funds is at risk.  At least Congressman Sablan had the wisdom to take action to protect the CNMI's funds by writing to VIce President Biden.

Letter from Congressman Gregorio Kilili Sablan to Vice President Biden:

Planning Meeting Saturday

October 22, 2010

Rabby Syed, President of the United Workers Movement-NMI is inviting all ethnic, worker and religious group leaders and interested parties to a planning meeting on Saturday, October 23rd at American Memorial Park from 5:00pm to 7:00pm to discuss the plans for the November 9th prayer vigil and petition campaign. See below:


The United Workers Movement-NMI is sponsoring a prayer vigil and launching petition signature campaign to U. S. President Barack Obama for the improved status of the CNMI alien workers.

What: Prayer Vigil and launching petition signature campaign to U.S President Barack Obama.

When: Tuesday, November 9, 2010 starting at 6:00 pm.

Where: American Memorial Park.

Why: To appeal to U.S President Barack Obama to take immediate action on the status of the alien workers in the CNMI and show support for the U.S. Secretary of Interior’s recommendations of long-term status for legal aliens who have resided in the CNMI for five years or more, and to urge U.S. Congress to act quickly on the recommendations.

Who: All members of the community are invited.

President Barack Obama spoke of hope. He said, "In the United States of America, there has never been anything false about hope...In America, no dream is beyond our grasp if we reach for it, and fight for it, and work for it. Because hope is not blind optimism."

For more information please contact Rabby Syed at 888-4025 or Ronie Doca at 235-1965.

Abramoff Friends

October 21, 2010

After four years, Jack Abramoff is now out of jail and living in a halfway house in Baltimore, MD. He has a job in a kosher pizza shop.  One indication is that he is easing back into the mainstream is his new Facebook page.

U.S. News reported about his Facebook page:

It lists six friends, including Floyd Brown, a GOP activist who runs the Web sites www.impeachobamacampaign.com and www.westernjournalism.com and who founded Citizens United, the group that helped to rewrite fundraising rules via a historic Supreme Court ruling in January that paved the way for corporate spending on campaigns this year.

While Abramoff hasn't yet returned our message to his Facebook page, Brown said it's his. "It is Jack, but I don't think he will be talking to the press anytime soon. He is just reconnecting with some friends from the old days that have expressed support during his difficult journey."

Another said it's possible that Abramoff may use Facebook in his comeback. "I think he has a number of plans moving into 2011, but I'm not sure how much or little they will involve FB."

Actually, I noticed the page before it was in the news.  At the time I found it, Abamoff had four friends. Guess who one of his FB friends is? None other than CNMI Governor Benigno Fitial. (Click bellow to enlarge):

Ring Retrial Begins

Team Abramoff lobbyists freely exchanged emails between themselves and their clients that would come back to bite them. Alex Gibney's Casino Jack and the United States of Money featured some of the most notorious emails exchanged between Abramoff and Scanlon proving that they intended to rip off Indian tribes.  Today in the U.S. District Court of the District of Columbia, U.S. Prosecutor Nathaniel Edmonds opened Kevin Ring's retrial with incriminating emails that he probably wishes that he never wrote.

From The Washington Post:

Lobbyist Kevin Ring wrote that "the ethics thing is a real turn off" and that his team preferred working with "amoral pond scum" in one e-mail, and Prosecutor Nathaniel Edmonds told jurors that the comments were evidence of Ring's win-at-any-cost mentality. He said Ring showered officials with event tickets, fancy dinners and never-ending drinks to get policies and taxpayer expenditures in favor of his clients instead of for the public good.

Ring's defense lawyer countered that the Justice Department is trying to criminalize "obvious jokes," and that they offer no evidence his client broke the law.

A joke? I hope the jury finds that remark as offensive as I do.

Ring's attorney made more excuses for his client's unscrupulous acts:

Ring attorney Andrew Wise told jurors the case will confirm some of their worst impressions of how Washington works, but his client was just one of many lobbyists using an expense account to build relationships in a legal, if distasteful, system.

"In this country, money controls politics. Lobbyists have a ridiculous impact on public policy," Wise said. "The way our government works and the role of lobbyists on our government are not on trial here."

If any of the jurors are fed up with Washington politics with its special interest groups and lobbyists stealing our democracy, that line may backfire big time.

Prosecutor Nathaniel Edmonds didn't think the emails were a joke:

Edmonds argued Ring's e-mails showed he used the gifts to put officials "on retainer" so they would repay him later with favors. "There is no lobbyist exception for bribery and corruption," 

Ring is charged with conspiracy, fraud, and making an illegal gratuity.

Edmonds said, "Millions of dollars were spent to get these public servants a taste of the good life, a bit of Washington that only the rich and the famous get to see," Edmonds said. They did it so "the public officials would 'pay them back' for everything Team Abramoff gave them."

As I disclosed in previous posts, some of those emails are between Ring, Fitial, Tan and Abramoff concerning the CNMI.

See also:
Kevin Ring Indicted September 8, 2008
As Pedicted Boulanger Charged January 28, 2009
Boulanger Pleads Guilty January 30, 2009
Revealing Plea Agreement February 4, 2009
Abramoff Scandal Nets One MoreFebruary 20, 2009

Doolittle Next to Fall? February 27, 2009

Kevin Ring Case: Prosecutor Welch Out April 24, 2009
Ruling in Kevin Ring Case: Charges Stand June 26, 2009
Order on Motions in Kevin Ring Case July 1, 2009
Kevin Ring Exhibits: CNMI Connection Exposed Through E-mails August 13, 2009
Abramoff Scandal: Trail Leading to the CNMI August 25, 2009
Abramoff Scandal: Bigger Fish to Be Caught September 5, 2009
Kevin Ring Trial Has Begun -You won't hear about it from CNMI news sources... September 13, 2009
Kevin Ring Trial, Albaugh Testifies,"I knew I broke the law." September 17, 2009

Kevin Ring Trial -Ashcroft Loyalist Invokes Fifth Amendment Rights

Kevin Ring Trial: Boulanger and Copland Testify September 23, 2009
Kevin Ring Trial:Connecting Dots September 24, 2009
The Headlines (finally) Say: "Doolittle Named in Corruption Trial" September 29, 2009
Kevin Ring Trial: Defense calls no witnesses October 5, 2009
Kevin Ring Trial: Jury slip up October 8, 2009
Kevin Ring Trial: mistrial Requested by proescutors and defense October 14, 2009

Kevin Ring: Judge to Declare Mistrial October 15, 2009

Questions Remain on Desk Audit Contract

MAI's Sergio Loya and Arthur Smith with former Rota Mayor Inos and
 Former Commerce Secretary Michael Ada (from Saipan Tribune)

October 20, 2010

Both the Marianas Variety and Saipan Tribune have published letters to the editor from the president of MAI, Arthur Smith. While sincere, there are still questions concerning the contract that was awarded to the company to perform the desk audit.  Mr. Smith said, "We appreciate the opportunity to serve Governor Fitial and his administration as well as the people of the CNMI."

Apparently Mr. Smith is overlooking the background of the governor, his many scandals and relationships with questionable people and criminals.  He has to overlook a lot and the list keeps growing.  There are the questionable deals between Jack Abramoff and the governor, the Tan-Fitial-Abramoff connection, the buying of the speakership, the governor's driver who was arrested for dealing ice from the governor's vehicle, massage-gate, gun-gate, parole-gate, the bad blood between the governor and federal officials, election-gate, the refusal to respond to Open Government Act requests and on and on.

Surely someone who has been in business for 34 years knows that state or territorial contracts that have so many connections to the governor's associates would be both scrutinized and criticized. Lynn Knight is currently a program manager for MAI, a former anti-federalization lobbyist, and is still Governor Fitial's Communication Director in Washington, DC.  MAI received a contract previously from CEDS when Lynn Knight was the Chair. It is not clear if that was a sole-source contract, who funded it or if it ended before the contract with the CNMI government began.

How would this scenerio play out in say New Jersey, Illinois or any other state?

The Saipan Tribune story published today raised even more questions. The Marianas Variety reported that eight companies submitted bids for the desk audit contract, while the Saipan Tribune, reporting on the story for the first time today, claimed that there were only two bids. The other company named y the Tribune was Saipan-based KIS Corporation owned by Dr. Ken Schankweiler.

The Saipan Tribune reported:

MAI's proposal as of January 2010 was over $1.217 million at 2,500 full-time employees of the CNMI government. This was equal to $487 per FTE for the entire organizational review pursuant to RFP09-OPM-099.

Ada, in a Jan. 20 letter to MAI president Arthur L. Smith, sought MAI's submission of a fee proposal only for DPS and Finance with total FTEs of 391.

The desk audit contract was for 180 days from the notice to proceed, or not later than Sept. 30, 2010.

In February, special assistant for management and budget Vicky Villagomez wrote to MAI, substituting Finance with DCCA and asked MAI to submit a fee proposal for this substitution.

The following month, the Fitial administration awarded a contract to MAI for $254,459.12, which was part of the $360,000 Office of Insular Affairs grant that the CNMI received, press secretary Angel Demapan said when asked for confirmation.

Was a letter for a modified proposal also sent to the other bidder/s?

While stories in the Variety reported that MAI received a contract for $300,000, the Saipan Tribune reports today the actual contract was for $254,459.12. Adding to the confusion is the fact that in July 2009 the governor's press secretary Angel Demapan said the desk audit contract was for $300,000.

Then there is the issue of the evaluating board. From the Saipan Tribune:

The four-member evaluation team included former press secretary Charles Reyes Jr., former acting personnel director Francisco S. Ada Jr., former personnel training director Dr. Peter C. Eche, and Marie T. Muna.

Like Governor Benigno Fitial, Lt. Governor Eloy Inos, Lynn Knight and Edward Arriola, MAI's registered agent in the CNMI, Charles Reyes also worked for Tan Holdings. Is it usual practice for a government to use the governor's  press secretary as a contract evaluator?

Transparency and full disclosure may help to stop speculation. The Governor's Office should put the RFP, proposals and contracts for this and the recently awarded ARRA contract online.

UPDATE:
The DOI's Office of Insular Affairs is investigating this contract according to KSPN2 News. Lynn Knight claimed that the probe is "politically motivated."  Please!

It appears that the OIA is also interested in Lynn Knight's contract with Fitial where she serves as the Governor's Communications Director for Washington DC. She refused to disclose the amount of that contract, which she says is paid for by CNMI funds.  The bankrupt CNMI government can afford to pay her to ...what does she do there?

Contract Concerns Continue

October 21, 2010


Vice President Wants to Review Ada Contract

And why wouldn’t he? A sole-source contract that was approved and awarded to a company before the company even had a business license is more than a little disconcerting!

The Vice-President oversees the ARRA money, including the $100 million awarded to the CNMI. The Marianas Variety reported:

Congressman Gregorio C. Sablan is asking Gov. Benigno R. Fitial for a copy of the federally funded contract with Ada’s Integrated Professional Solutions LLC which will be provided to Biden. 

In his letter to Fitial yesterday, Sablan said Biden’s Recovery Act office has contacted the CNMI congressman, requesting for a copy of the controversial contract. 

Biden’s office, Sablan said, is also asking about the specific agency account from which the contract is funded as well as the specific funding amounts. 

On Tuesday, Sablan wrote Biden a letter asking for advice on how to ensure that any challenge to Ada’s contract will not result in an interruption in the availability of American Recovery and Reinvestment Act funds provided to the cash-strapped CNMI government. 

Expressing concern about the sole-source contract, Sablan told Biden that the controversy is getting wide media coverage and “there seems to be significant public indignation.”

The Governor’s press release announcing that the contract was awarded stated that Ada was the only person capable of fulfilling the job. However, there were other people, including a program manager, who were capable of fulfilling the duties and may have wanted to bid on the job.

The Saipan Tribune reported:

Delegate Gregorio Kilili C. Sablan, in a letter yesterday to Gov. Benigno R. Fitial, said the vice president is requesting not only a copy of Ada's contract but other related information as well.

“The vice president's office has also asked for information about the specific agency account from which this contract is funded, the specific funding amounts, and whether the CNMI Department of Commerce made the local award or some other agency of the CNMI government,” Sablan told Fitial.

Press secretary Angel Demapan, when asked for comment yesterday, said the Fitial administration “will be contacting the vice president's office to provide the information it is requesting.”

…Sablan said he is not in a position to make any judgment on the particular circumstances of the sole-source contract for ARRA management in the CNMI.

But he sought the advice of the Recovery Act's office “on how to ensure that any challenge to this no-bid, sole-source contract that may arise will not result in an interruption of the use or availability of the Recovery Act funds that have been generating new jobs, as well as saving existing ones, and spurring economic activity” in the CNMI.

“Your administration has made rigorous efforts to avoid any fraud or abuse in the management and implementation of ARRA funds,” Sablan told Biden in an Oct. 19 letter.

It's good to know that someone is concerned about how and if the controversial contract will impact the CNMI's ARRA funding.

Desk Audit

The DOI expected the desk audit completed by Management Analysis, Inc. to be conducted on CHC and not on the DPS and DCCA according to the Marianas Variety:

The U.S. Office of Insular Affairs provided a technical assistance grant to the CNMI government so it could review the Commonwealth Health Center’s organizational structure.

But the Fitial administration instead awarded a $360,000 contract for the desk audit of the Department of Community and Cultural Affairs and the Department of Public Safety.

Variety also learned that the terms in the request for proposal that the administration provided to the eight bidders were different from what was conducted by Virginia-based Management Analysis Inc., which won the contract.

One of MAI’s managers is Gov. Benigno R. Fitial lobbyist, Lynn A. Knight. It’s local agent is Tan Holdings corporate affairs manager Ed Arriola Jr.

…Some of the losing bidders told this reporter that they felt misled by the administration.


When the administration requested for the technical assistant grant two years ago, it listed CHC, the Commonwealth Utilities Corp., the Public School System, the Department of Public Works and the Department of Community and Cultural Affairs as the entities it wanted assessed.

The total cost of the project would be $1.4 million — $433,361 for CHC; $310,339 for CUC; $294,487 for PSS; $238,363 for DPW; and $179,219 for DCCA.

The project, the grant request stated, would “result in right-sizing existing government programs, thus realizing service savings opportunities while continuing to meet program objectives.”

It would also “develop a list of recommended jobs that will be in-demand. To accommodate the employees who will be affected by the organizational assessment, the Office of Personnel Management and the Department of Labor will arrange a job fair with the private sector.”

The Variety reported the timeline of the desk audit contract:

• May 12, 2008, OPM Director Isidro K. Seman and training director Peter C. Eche came up with an RFP for the project that will be implemented in the five departments.

• The RFP presented to the eight vendors including MAI.

• May 19, 2008, OIA Director Nikolao Pula sent Fitial a notification of grant award amounting to $360,000.  Pula told Fitial in his letter, “These federal funds are provided to assist the CNMI in obtaining a qualified firm to conduct an organizational review for CHC.”

The review, Pula said, should “focus on cost reduction, utilizing a structure and proven methodology to help the CNMI government make sound business decisions on downsizing, outsourcing and privatization while minimizing the social economic impacts.”

Pula said the funds “are not to be used for any purpose other than that for which they are offered without prior approval from OIA.”

“Any substantial change in the scope of work or project budget must be submitted to the grant manager. The project revisions shall not be implemented until the OIA grant manager sends written approval to the grantee,” Pula added. 

The governor's press secretary, Angel Demapan said because the award was reduced from the original amount,  the CNMI was allowed to choose what departments would be audited.

According to the Variety, "Demapan said bids that were submitted were way above the funding level provided by OIA."

It would be interesting to read all of the bids and to learn why and when MAI was selected to conduct the desk audit.