Also missed construction deadline
Imperial Pacific International, developer and operator of the only casino resort on the island of Saipan, is refuting claims that it doesn’t have enough money to pay staff or contractors at its island resort complex, also called Imperial Pacific.
On August 17, IPI issued a statement saying the company had been “experiencing transfer issues to fund the company’s payroll for the pay period.” Even so, IPI asserted, it had paid “over 2,000” of its hourly employees on time, while salaried employees would receive their wages “within the week.”
Earlier this month, the Saipan Tribune reported that construction firm GPPC Inc. and other contractors were pressuring local politicians to force IPI to pay its past-due bills. An IPI representative told the Tribune that the company was “currently working on the settlement payment with GPPC and other vendors following the completion of its ongoing routine evaluation of all of its service providers.”
Licensed to operate the sole casino in the Commonwealth of the Mariana Islands, a U.S.-controlled territory, IPI has posted staggering VIP turnover levels, but also sparked questions about the massive sums it writes off in bad credit markers. That number exceeded $500 million in 2017, according to CalvinAyre.com. The group has begun court proceedings in Saipan to sue 13 customers it says got loans ranging from US$100,000 to US$6.2 million. Imperial Pacific says it is owed US$12.75 million.
Meanwhile, U.S. Rep. Gregorio Sablan has expressed concerns that IPI has displaced American workers in favor of foreign workers, despite a requirement that the company employ Americans as 65 percent of the construction workforce. Sablan said that “objective has not been met.” The company has brought in help from the Philippines and added a night shift in order to complete the project, reported Marianas Variety. Eric Poon, IPI vice president for construction, recently said the project was 69 percent complete.
On the payroll matter, the company has asked for the community’s “continued support, patience and understanding,” the release said.
Phase I of the resort will include a 329-room luxury hotel, a 14,140-square-meter (252,000-square-foot) casino, villas, restaurants, shops and meeting space. In its April 27 annual report, the group said “approximately US$650 million” had already been invested in the “design, consulting, engineering, construction materials and labor costs” for the Saipan resort. The company’s annual profit narrowed by 31.9 percent to HKD637.5 million (US$81.2 million) last year.
In light of the payroll problems, Saipan Rep. Edwin K Propst says the jurisdiction should open to other gaming operators. “Because there’s only one licensee, perhaps we should revisit that and allow other casinos to compete,” Propst told the Tribune. “Competition is good. Factoring all the recent events, we need to be very concerned about the future of our casino, because they are not just one competitor. This is a sole source, single license. It is a monopoly.”
Propst said he is also displeased because the company has announced it will miss its latest deadline to complete the IR, August 31. “I want the casino industry on Saipan to thrive but I also want it to be properly regulated and to follow all laws—local, federal, and environmental laws,” he said. “The fact that the casino license agreement has been amended five times to benefit the casino without benefitting the people is disappointing.
“The CNMI government must renegotiate its terms to include at the very least a completion or performance bond to ensure the casino hotel overlooking Garapan will be completed, even if IPI decides to leave or suspend their business operations,” he said.
Concurrently, two members of IPI’s board have resigned. Chairman Marco Teng, who assumed that role in January, left in order to “pursue endeavors of his personal interest.” He was followed in short order by Cai Lingli, a director and chairwoman of the group’s executive committee. In its statement on her resignation, IPI said “Ms. Cai wishes to devote additional time to her family and other personal and business commitments.”
IPI’s remaining board of directors is scheduled to meet August 30 to discuss the company’s first-half results.
