Raising Revenue in the CNMI: Expanding Gambling and Legalizing Marijuana

March 28, 2011

One would expect that CNMI legislators would be coming up with solutions to raise revenue for the empty coffers.  Two legislators think that the revenue solution lies with gambling and drugs, both activities known to attract criminal elements.  Both legislators also seem to be proposing bills that would benefit themselves since one is known for his marijuana smoking, and one for his gambling interests.

Rep. Stanley Torres has reintroduced his marijuana legalization bill  for "medical and recreational use" with restrictions that adults don't smoke near school grounds or when minors are present.

The bill would tax and regulate marijuana according to Torres, who claimed that it would bring much needed income to the CNMI. It may also repeal any families looking to vacation in the islands and further raise the eyebrows of the U.S., which is the primary source of funding for the CNMI including grants.

At least some people support the bill, and it seems to have produced some publicity for the islands. The CNMI Representative's bill was featured on a website called Toke of the Town. From the blog:
"I have found that the time has come to legalize the use and possession of marijuana for all purposes and to remove any and all associated penalties," Torres said. (Damn, is this guy eligible to run for President of the United States?)

The CNMI Department of Public Health and the Public School System have already expressed their opposition to the legalization of marijuana use and possession.

Legalized marijuana in a protectorate of the United States like Saipan/CNMI would, as pointed out last April by NORML's "Radical" Russ Belville, mean "some really cool new vacation spots that don't require a passport and checking through Customs."

If, like me, you're a convicted felon in the United States, you're already well aware what that means. An exotic, "foreign" vacation spot is now available to you, even though you can't get a passport! (Yes, I know: felons can get passports -- with lots of money and good lawyers. I'm a felon. I can't get a passport. Capiche?)
Felons think it is a great bill!

It appears that Rep. Froilan Tenorio may have a back door deal with some South Korean, Chinese or Japanese casino and gambling investors because he has been pushing casino and internet gambling since he took office. He has gone ballistic when challenged by fellow lawmakers or when his bills have met their death. Such behavior suggests he stands to personally gain by the passage of the legislation.

Although Rep. Tenorio's casino bill was defeated by the Senate last year, a hybrid version combining his casino bill with one introduced by Rep. Stanley Torres has been drafted by the House Ways and Means Committee.

Tenorio appears to have an obsession with gambling. Remember Governor Froilan Tenorio was a good buddy with Jack Abramoff, another guy who was also pushing for and connected to casinos.  It was his greedy Indian lobbying deals and Sun Cruz, which landed him in federal prison. Tenorio hired Jack Abramoff to kill federalization and minimum wage legislation costing the CNMI $11 million. (Wouldn't it be helpful to have that cash now?)

Tenorio has a long history of supporting gambling and casinos.  In 1997 then governor Tenorio and his wife Sophie took an Abramoff-sponsored trip to visit the Choctaw Mississippi casinos on the taxpayers' dime. In 2003 Tenorio was pushing his "casinos will save the CNMI" theory once again at a public hearing. In 2004, Tenorio was pushing casinos on all three islands, vowing to meet with the Catholic Church and stating several "Japanese investors support the proposal."

Aside from Abramoff and fellow lobbyists, Tenorio has been hanging with some shady folks. In 1999 Governor Froilan Tenorio was being investigating for misuse of funds including a $3.4 million loan that he granted to the Tinian Casino Gaming Control Commission. In 2007, Tenorio was implicated in an illegal casino gambling scheme at the Victoria Hotel in Garapan, Saipan with his Japanese business partner, Hideo Kato and businessman, Byoong Seob Choi who were charged with 119 counts of illegal gambling activity and unlawful employment of aliens.

Now Tenorio plans to introduce a bill that would allow casinos on Rota and Tinian to offer online gambling. Masahiro Watanabe's name came up yesterday as discussing the idea of online gambling with Rota mayor Mendiola and the Rota legislative delegation. Maybe some of those "leaders" could ask that crook to pay his employees. The Rota Hotel and Casino run by Watanabe owes tens of thousands to many nonresident workers. How can they even consider an idea of expansion of gambling when the current business doesn't attract enough clients to keep it afloat or pay the employees?

The CNMI government is  also currently negotiating with shady company Bridge Capital LLC in restoring the La Fiesta Mall to create a video lottery mecca and other business enterprises in the vacant space. Bridge Capital owners, Shawn Scott and John K. Baldwin are controversial.  Residents in the Washington, D.C. area filed a lawsuit to oppose their proposal for slot-machines in the area.

From the Washington Post:
Bridge Capital is owned by Shawn Scott and John K. Baldwin, Las Vegas entrepreneurs who have tried for years to qualify for a license to operate a big-time gambling venture. They have had little luck, public records show. Scott, whose properties have received financial support from Baldwin, has been denied or failed to obtain gambling licenses in five states where regulators found evidence of financial mismanagement, irregular accounting practices and hidden partnerships.
TPM Muckraker details the connections of Baldwin, Abramoff, Julius Kaplan and others. Shady.

There are other revenue-raising ideas that may not go up in smoke or threaten to gamble away the public safety in the CNMI.  Legalizing marijuana and expanding casinos may attract some tourists down the road, but such endeavors will also attract an unwanted criminal element.  Focusing on developing agriculture, aquaculture or reviving the tourist industry seems a safer bet. The CNMI is physically beautiful and can offer an endless variety of alluring ocean and outdoor activities for tourists.  Highlighting the culture, history, and physical beauty instead of focusing on controversial activities like smoking pot and gambling would attract more families to vacation in the CNMI and would be better for the residents in the long run. Of course, establishment of sales, income or property taxes would also raise much-needed revenue and far more quickly than casinos could be built.


Anonymous said...

Why are you so fixated on casino gambling in the CNMI? How in the world will it affect the CWs? Most will be gone anyway under Federal Law.

There are well over 500 casinos in the US. Wendy, here is a list of casinos in just Florida:

Big Cypress Casino
Big M Casino
Brighton Seminole Bingo and Casino
Calder Casino & Race Course
Dania Jai-Alai
Gulfstream Park Racing & Casino
Hollywood Seminole Gaming
Horizon's Edge Casino Lines
Jacks or Better Casino
Las Vegas Casino Lines
Magic City Casino
Mardi Gras Racetrak and Gaming Center
Miccosukee Indian Gaming
Palm Beach Princess
Seminole Casino Coconut Creek
Seminole Casino Immokalee
Seminole Hard Rock Hotel & Casino - Hollywood
Seminole Hard Rock Hotel & Casino - Tampa
SunCruz Casino - Jacksonville
SunCruz Casino - Key Largo
SunCruz Casino - Port Canaveral
SunCruz Casino - Port Richey
The Isle at Pompano Park

Wendy said...

Anonymous 4:37

I am not "fixated" on casinos, but more on the corruption that my tax dollars and the tax dollars of US citizens (those living in the states) are funding.

--The Tinian and Rota casino workers are in constant touch with me. THEY ARE NOT BEING PAID! What makes you think future casino workers, whether residents or nonresidents, will be paid?

--If the two casinos existing can't attract visitors, why would new ones?

--The legislators are proposing businesses that will benefit themselves personally and not necessary bring revenue to the CNMI.

--Some of those involved with the Saipan casino proposals in the past (and present) are shady characters; some are felons.

--My tax dollars fund the CNMI.

Yes, there are Indian casinos and floating casinos in many states in the U.S. I am fairly certain that they have the populations to support their existence and their employees are being paid.

the teacher said...

Mentioning Florida casinos is changing the subject 4:37. We can’t compare with Florida in volume, number of tourists, attractions, experience in the industry, or anything else. I am not opposed to casinos from moral or religious convictions, I am against them here because it is a proven loser and the revenue would not compensate or outweigh the negative societal impact even if it produced some revenue. The idea of a large casino is ridicules. The question is, would small casino rooms in our hotels like the Carib perform. We don't have the market, inbound flights, security capability, or capitalization needed, besides the fact we have no upscale housing or rooms to accommodate high rollers, who shell out the bulk of casino room profits. And most of our hotels are losing their shorts and not even able to renovate. The case against casinos here is the character of the people pushing it so hard.

I like part of Stanley’s bill but not all of it. I don’t like the complete and casual legalization because it cheapens the product, would make it difficult to regulate, and it would not likely become a productive money maker for the CNMI. We do have 360 days a year of sunshine, ideal soil, dozens of million plus cities where it is currently illegal within five hours by air, and we wouldn’t need to cross another state line to export it. I like the fact a young person doesn’t get a felony conviction pinned on them and get their life ruined for something as harmless as weed. I would like the bill better if it substantially increased penalties for ice and narcotics possession and distribution. To advertise “come to the CNMI, we smoke weed but we lock up crack heads and violent offenders and throw the key away” may have merit. Would small Amsterdam style coffee shops, where 21 yr old tourists could safely pay 50. or so to smoke a joint in safety, be profitable? Could the farmed product be taxed and regulated? Would those heavily taxed coffee shops generate revenue? We would draw more tourists and be on the map in Amsterdam and throughout Europe? If studied and properly marketed and executed, I believe marijuana has more potential for the NMI than casinos.

Anonymous said...

I have seen several House or Senate bills (mainly House) that are constructed so specifically that it helps create a new business to which only one group of people can satisify the requirements OR change the rules that would favor one business model over another when there was really no reason to do so (except to help one company. To be fair, sometimes regulations need to changed to help a business do business or to close up loop holes that allow one business to have an unfair advantage over another one (and advantage created by arbitary legal requirements).
The Casino is a great economic benefit...to the people putting it together. Understand, I am not against people making money, even our elected officials, but this casino deal will not generate enough money to make it worthwhile. Again, it will be be beneficial to folks like the Commissoners who will make alot of money (probably five people making 70K plus each and the chairman making 100K) Of course, these will be well connected political people with probably no expertise in much of anything. Good deal for them and they will spend the money on the island (except when they go off-island to their many "casion management" meetings). Actually, the social cost will not be a whole lost worse than now because video poker has devastated the island. We need to get rid of the poker houses (I understand they are not making as much now, that is good). Now, if Steve Wynn wants to come in and put a Treasure Island or Bellagio in here in I would welcome him with open arms, but we are just talking about a small, seedy, backwater, casino that provides a nice check to the leaders (Probably on of those incidious NMI only corporations)that said "yes" (and that's about it) to the idea.
Bad of NMI, Bad for People, Bad for Business, Good for (insert name of connected local official here).

Anonymous said...

Noni 9:05

great comment!

Anonymous said...

Legalize it now! Illegality is not based on facts. Most everyone you talk to think it should be legal, but to afraid to speak up publicly.

Casino again? The people vote NO. NO is NO. Let the people vote again. That is okay. Maybe they vote yes or NO again. But dont spit on the people and their votes. Resptect Lang!

Anonymous said...

Baldwin is a snake that I wouldn't trust. He would sell his mother if he could make a profit. The IRS should watch out for him.