H. R. 2466—27
of the Treasury, shall make available to the Government of Amer-
ican Samoa (hereinafter ‘‘ASG’’), the benefits of a loan in the amount
of $18,600,000 bearing interest at a rate equal to the United States
Treasury cost of borrowing for obligations of similar duration.
Repayment of the loan shall be secured and accomplished pursuant
to this section with funds, as they become due and payable to
ASG from the Escrow Account established under the terms and
conditions of the Tobacco Master Settlement Agreement (and the
subsequent Enforcing Consent Decree) (hereinafter collectively
referred to as ‘‘the Agreement’’) entered into by the parties
November 23, 1998, and judgment granted by the High Court
of American Samoa on January 5, 1999 (Civil Action 119–98, Amer-
ican Samoa Government v. Philip Morris Tobacco Co., et. al.).
(b) CONDITIONS REGARDING LOAN PROCEEDS.—Except as pro-
vided under subsection (e), no proceeds of the loan described in
this section shall become available until ASG—
(1) has enacted legislation, or has taken such other or
additional official action as the Secretary may deem satisfactory
to secure and ensure repayment of the loan, irrevocably
transferring and assigning for payment to the Department of
the Interior (or to the Department of the Treasury, upon agree-
ment between the Secretaries of such departments) all amounts
due and payable to ASG under the terms and conditions of
the Agreement for a period of 26 years with the first payment
beginning in 2000, such repayment to be further secured by
a pledge of the full faith and credit of ASG;
(2) has entered into an agreement or memorandum of
understanding described in subsection (c) with the Secretary
identifying with specificity the manner in which approximately
$14,300,000 of the loan proceeds will be used to pay debts
of ASG incurred prior to April 15, 1999; and
(3) has provided to the Secretary an initial plan of fiscal
and managerial reform as described in subsection (d) designed
to bring the ASG’s annual operating expenses into balance
with projected revenues for the years 2003 and beyond, and
identifying the manner in which approximately $4,300,000 of
the loan proceeds will be utilized to facilitate implementation
of the plan.
(c) PROCEDURE AND PRIORITIES FOR DEBT PAYMENTS.—
(1) In structuring the agreement or memorandum of under-
standing identified in subsection (b)(2), the ASG and the Sec-
retary shall include provisions, which create priorities for the
payment of creditors in the following order—
(A) debts incurred for services, supplies, facilities,
equipment and materials directly connected with the provi-
sion of health, safety and welfare functions for the benefit
of the general population of American Samoa (including,
but not limited to, health care, fire and police protection,
educational programs grades K–12, and utility services
for facilities belonging to or utilized by ASG and its agen-
cies), wherein the creditor agrees to compromise and settle
the existing debt for a payment not exceeding 75 percent
of the amount owed, shall be given the highest priority
for payment from the loan proceeds under this section;
(B) debts not exceeding a total amount of $200,000
owed to a single provider and incurred for any legitimate
H. R. 2466—28
governmental purpose for the benefit of the general popu-
lation of American Samoa, wherein the creditor agrees
to compromise and settle the existing debt for a payment
not exceeding 70 percent of the amount owed, shall be
given the second highest priority for payment from the
loan proceeds under this section;
(C) debts exceeding a total amount of $200,000 owed
to a single provider and incurred for any legitimate govern-
mental purpose for the benefit of the general population
of American Samoa, wherein the creditor agrees to com-
promise and settle the existing debt for a payment not
exceeding 65 percent of the amount owed, shall be given
the third highest priority for payment from the loan pro-
ceeds under this section;
(D) other debts regardless of total amount owed or
purpose for which incurred, wherein the creditor agrees
to compromise and settle the existing debt for a payment
not exceeding 60 percent of the amount owed, shall be
given the fourth highest priority for payment from the
loan proceeds under this section;
(E) debts described in subparagraphs (A), (B), (C), and
(D) of this paragraph, wherein the creditor declines to
compromise and settle the debt for the percentage of the
amount owed as specified under the applicable subpara-
graph, shall be given the lowest priority for payment from
the loan proceeds under this section.
(2) The agreement described in subsection (b)(2) shall also
generally provide a framework whereby the Governor of Amer-
ican Samoa shall, from time-to-time, be required to give 10
business days notice to the Secretary that ASG will make
payment in accordance with this section to specified creditors
and the amount which will be paid to each of such creditors.
Upon issuance of payments in accordance with the notice, the
Governor shall immediately confirm such payments to the Sec-
retary, and the Secretary shall within three business days
following receipt of such confirmation transfer from the loan
proceeds an amount sufficient to reimburse ASG for the pay-
ments made to creditors.
(3) The agreement may contain such other provisions as
are mutually agreeable, and which are calculated to simplify
and expedite the payment of existing debt under this section
and ensure the greatest level of compromise and settlement
with creditors in order to maximize the retirement of ASG
debt.
(d) FISCAL AND MANAGERIAL REFORM PROGRAM.—
(1) The initial plan of fiscal and managerial reform,
designed to bring ASG’s annual operating expenses into balance
with projected revenues for the years 2003 and beyond as
required under subsection (b)(3), should identify specific meas-
ures which will be implemented by ASG to accomplish such
goal, the anticipated reduction in government operating expense
which will be achieved by each measure, and should include
a timetable for attainment of each reform measure identified
therein.
(2) The initial plan should also identify with specificity
the manner in which approximately $4,300,000 of the loan
proceeds will be utilized to assist in meeting the reform plan’s
H. R. 2466—29
targets within the timetable specified through the use of incen-
tives for early retirement, severance pay packages, outsourcing
services, or any other expenditures for program elements
reasonably calculated to result in reduced future operating
expenses for ASG on a long term basis.
(3) Upon receipt of the initial plan, the Secretary shall
consult with the Governor of American Samoa, and shall make
any recommendations deemed reasonable and prudent to ensure
the goals of reform are achieved. The reform plan shall contain
objective criteria that can be documented by a competent third
party, mutually agreeable to the Governor and the Secretary.
The plan shall include specific targets for reducing the amounts
of ASG local revenues expended on government payroll and
overhead (including contracts for consulting services), and may
include provisions which allow modest increases in support
of the LBJ Hospital Authority reasonably calculated to assist
the Authority implement reforms which will lead to an inde-
pendent audit indicating annual expenditures at or below
annual Authority receipts.
(4) The Secretary shall enter into an agreement with the
Governor similar to that specified in subsection (c)(2) of this
section, enabling ASG to make payments as contemplated in
the reform plan and then to receive reimbursement from the
Secretary out of the portion of loan proceeds allocated for the
implementation of fiscal reforms.
(5) Within 60 days following receipt of the initial plan,
the Secretary shall approve an interim final plan reasonably
calculated to make substantial progress toward overall reform.
The Secretary shall provide copies of the plan, and any subse-
quent modifications, to the House Committee on Resources,
the House Committee on Appropriations Subcommittee on the
Department of the Interior and Related Agencies, the Senate
Committee on Energy and Natural Resources, and the Senate
Committee on Appropriations Subcommittee on the Department
of the Interior and Related Agencies.
(6) From time-to-time as deemed necessary, the Secretary
shall consult further with the Governor of American Samoa,
and shall approve such mutually agreeable modifications to
the interim final plan as circumstances warrant in order to
achieve the overall goals of ASG fiscal and managerial reforms.
(e) RELEASE OF LOAN PROCEEDS.—From the total proceeds of
the loan described in this section, the Secretary shall make
available—
(1) upon compliance by ASG with paragraphs (b)(1) and
(b)(2) of this section and in accordance with subsection (c),
approximately $14,300,000 in reimbursements as requested
from time-to-time by the Governor for payments to creditors;
(2) upon compliance by ASG with paragraphs (b)(1) and
(b)(3) of this section and in accordance with subsection (d),
approximately $4,300,000 in reimbursements as requested from
time-to-time by the Governor for payments associated with
implementation of the interim final reform plan; and
(3) notwithstanding paragraphs (1) and (2) of this sub-
section, at any time the Secretary and the Governor mutually
determine that the amount necessary to fund payments under
paragraph (2) will total less than $4,300,000 then the Secretary
may approve the amount of any unused portion of such sum
H. R. 2466—30
for additional payments against ASG debt under paragraph
(1).
(f ) EXCEPTION.— Proceeds from the loan under this section
shall be used solely for the purposes of debt payments and reform
plan implementation as specified herein, except that the Secretary
may provide an amount equal to not more than 2 percent of the
total loan proceeds for the purpose of retaining the services of
an individual or business entity to provide direct assistance and
management expertise in carrying out the purposes of this section.
Such individual or business entity shall be mutually agreeable
to the Governor and the Secretary, may not be a current or former
employee of, or contractor for, and may not be a creditor of ASG.
Notwithstanding the preceding two sentences, the Governor and
the Secretary may agree to also retain the services of any semi-
autonomous agency of ASG which has established a record of sound
management and fiscal responsibility, as evidenced by audited
financial reports for at least three of the past 5 years, to coordinate
with and assist any individual or entity retained under this sub-
section.
(g) CONSTRUCTION.—The provisions of this section are expressly
applicable only to the utilization of proceeds from the loan described
in this section, and nothing herein shall be construed to relieve
ASG from any lawful debt or obligation except to the extent a
creditor shall voluntarily enter into an arms length agreement
to compromise and settle outstanding amounts under subsection
(c).
(h) TERMINATION.—The payment of debt and the payments
associated with implementation of the interim final reform plan
shall be completed not later than October 1, 2003. On such date,
any unused loan proceeds totaling $1,000,000 or less shall be trans-
ferred by the Secretary directly to ASG. If the amount of unused
loan proceeds exceeds $1,000,000, then such amount shall be cred-
ited to the total of loan repayments specified in paragraph (b)(1).
With approval of the Secretary, ASG may designate additional
payments from time-to-time from funds available from any source,
without regard to the original purpose of such funds.
SEC. 126. The Secretary of the Interior, acting through the
Director of the United States Fish and Wildlife Service and in
consultation with the Director of the National Park Service, shall
undertake the necessary activities to designate Midway Atoll as
a National Memorial to the Battle of Midway. In pursuing such
a designation the Secretary shall consult with organizations with
an interest in Midway Atoll. The Secretary shall consult on a
regular basis with such organizations, including the International
Midway Memorial Foundation, Inc. on the management of the
National Memorial.
SEC. 127. Notwithstanding any other provision of law, the
Secretary of the Interior is authorized to redistribute any Tribal
Priority Allocation funds, including tribal base funds, to alleviate
tribal funding inequities by transferring funds to address identified,
unmet needs, dual enrollment, overlapping service areas or inac-
curate distribution methodologies. No tribe shall receive a reduction
in Tribal Priority Allocation funds of more than 10 percent in
fiscal year 2000. Under circumstances of dual enrollment, overlap-
ping service areas or inaccurate distribution methodologies, the
10 percent limitation does not apply.