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07/08/2025 - The Senate Committee on Gaming on July 7 recommended that the Senate reject Gov. Arnold I. Palacios’ Executive Order 2025-002, which seeks to transfer authority for the supervision of casino gaming from the Commonwealth Casino Commission (CCC) to the Commonwealth Lottery Commission.
Panel chair Sen. Corina L. Magofna and members Sens. Donald M. Manglona, Karl R. King-Nabors, and Ronnie M. Calvo all voted in favor of King-Nabors’ motion to recommend rejection of Palacios’ executive order. Sens. Jude U. Hofschneider and Francisco Q. Cruz were excused.
The motion also included the production of a committee report for adoption and disposition by the full Senate at its upcoming session.
Senate legal counsel Antonette Villagomez delivered her legal opinion at the start of the hearing, identifying multiple legal issues with Palacios’ EO.
She explained that under Article 3, Section 15 of the CNMI Constitution, the governor may reorganize offices but cannot legislate through executive order or repeal existing laws, citing Supreme Court precedent in Torres v. Commonwealth (2009), which clarifies this limitation.
Villagomez noted that Executive Order 2025-002 contradicts 4 CMC §2313 by removing casino commissioners in a manner contrary to their legal protections, as commissioners cannot be removed without cause.
She further argued that merging an autonomous agency—the CCC—with a department-level agency like the lottery commission would undermine the Legislature’s intent to keep the CCC independent.
Villagomez also pointed to potential legal issues in altering appointment and qualification requirements for commissioners, which are set by law. Unlike lottery commissioners, casino commissioners must meet stricter qualifications.
“They were not appointed and confirmed in the same manner as the [lottery] commissioners. Unlike the lottery commission, the casino commissioners must be of good moral character, possess a bachelor's degree, have management experience, and be free from any direct or indirect interest in any casino license,” she said.
The EO, she added, would also create governance ambiguity over who—the secretary of Finance or the lottery commission executive director—would oversee casino gaming operations after the transfer.
Palacios’ EO, Villagomez noted, also infringes upon the doctrine of separation of powers because it effectively repeals or alters existing casino statutes, which is a power reserved for the Legislature, not the Executive Branch.
It also raises constitutional concerns, as the EO’s changes could violate constitutional protections for autonomous agencies and established processes for appointing or removing commissioners.
The bottom line, Villagomez intimated, is that the EO likely exceeds Palacios’ authority by altering statutory frameworks, repealing or modifying laws without legislative action, and creating administrative confusion and potential conflicts of interest—for example, the Attorney General serving as both a commissioner and legal counsel.
“The EO proposes to transfer this commission under the lottery commission, where the Attorney General is an official member by statute. So, you're going to have the Attorney General on the lottery commission and also representing the casino commissioners in litigation. I believe this might create a conflict as well,” she said.
Executive Order 2025-002, which Palacios signed on May 30, 2025, seeks to transfer the responsibilities of the CCC to the lottery commission, effectively terminating the casino commissioners’ terms on the grounds that their positions would no longer have statutory authority.
Villagomez also noted that the EO aims to move all supervisory and enforcement authority over casino gaming from the CCC to the lottery commission and assigns new casino-related responsibilities not included in the lottery commission’s enabling statutes.
After the full Senate votes on the committee’s report on Executive Order 2025-002, Palacios’ EO and the result of the Senate’s vote will be transmitted to the House of Representatives.
The July 7 Senate Committee on Gaming hearing was also attended by CCC chair Edward Deleon Guerrero and commissioners Ralph Demapan and Mariano Taitano.
Report by Mark Rabago
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