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Too Big To Fail U.S. Pacific Island Casino Keeps Failing by Muhammad Cohen

Last Friday’s Marianas Variety newspaper reports the Rotary Club of Saipan raked in US$34,000 from a Las Vegas Night. Perhaps the Rotarians can teach Imperial Pacific International how to operate a profitable casino on the U.S. Pacific island, part of the Commonwealth of Northern Marianas Islands. Hong Kong listed IPI declared a loss of nearly HK$3 billion (US$382 million) for last year. After reporting stratospheric VIP volumes under former Sands China and Trump Casinos head Mark Brown, IPI has written off more than HK$9.7 billion in player debt, and still carries almost HK$5 billion, more than five times its reported profits since opening a temporary casino in a shopping mall in July 2015. Worse, its partly built hotel in Garapan, Saipan’s central tourist district, is an eyesore, a federal case and, to some, a desecration. Worse, after providing more than half the CNMI budget in fiscal 2018, IPI is failing to deliver government revenue, a justification for casino legalization despite consecutive referendums that voted no. Deemed too big to fail, IPI is failing.

“Today at a Ways and Means Committee meeting, administration officials disclosed that since October 2018, the government has collected just $41,000 in casino gross revenue taxes. That’s it. And just so we are clear that I am not missing zeros in that number, that’s forty-one thousand dollars” local legislator Tina Sablan wrote in an email sent Tuesday. “We’ve gone through the first half of the fiscal year, and that’s all that IPI has paid. Compare that to nearly $44 million in casino GRT in 2018, and about $68 million in 2017 – taxes that went to retirees’ pensions, public schools, the hospital, infrastructure. The impact of this sudden tumble in collections is huge.”

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