Date: 1984-06-28
Speaker: WON PAT (democrat)
Chamber: H

Mr. Speaker. this amendment includes all of the provisions we have agreed upon and satisfica the concerns brought out to our attention. Mr. Speaker. H.R. 5501 is a bill to facilitate the economic development of the U.S. territories by providing necessary assistance and removing unnecessary statutory impediments. A modified and expanded bill that was based on an administration request received the bipartisan support of the Committee on Interior and Insular Affairs. And. since being reported. it has been reviewed by the Committees on the Budget. Merchant Marine and Fisheries. and Ways and Means. It would be altered by an amendment in the nature of a substitute that I will offer shortly. The amendment will accommodate the concerns of these committees. as well as our committee. administration and territorial officials. and make technical changes. The changes would require no new spending and the- amendments since introduction include savings of at least $14 million over the next few years. The bill would also result in additional savings that I believe would be at least that great over the longer term. Amendments requested by the Committee on the Budget would avert the slight possibility of an even slighter budget impact this fiscal year from the issuance of bonds by American Samoa and the Virgin Islands. Amendments requested by the Committee on Ways and Means would avert the slight possibility of an even slighter conflict with the tax bill by removing references to the Internal Revenue Code with respect to those bonds. Amendments requested by the Committee on Merchant Marine and Fisheries would conform the bill to fisheries and shipping laws. They also recognize the shared jurisdiction of our two committees with regard to the application of law in this area to the territories. Amendments requested with the support of the majority and minority on the Committee on Interior and Insular Affairs would rationalize the application of certain laws to the territories. eliminating inequities between territories and taking Into account the unique circumstances of the territories. For the benefit of Members. let me now explain in some detail what the provisions of the bill are intended to accomplish. Section 1W. would authorize $2 million for each of fiscal years 198587 for the Department of the Interior to provide technical assistance for private sector development in Guam. the Virgin Islands. American Samoa. and tile Northern Mariana Islands. While the existing authorization for Interior technical assistance to the territories Is broad. it does not specifically include private sector development projects. Current technical assistance efforts are directed to territorial public sector dvelopment projects. Further. although the existing authorization might cover the $2 million the bill proposes be spent annually over the next 3 years. we feel a specific authorization of funds for this purpose Is necessary to obtain additional technical assistance funds for this specific purpose. Section 102 would require the Department to report to the committees with jurisdiction over the territories. Interior and Insular Affairs in the House and Energy and Natural Resources in the Senate. on administration efforts regarding and proposals for developing businesses i the territories. The initial report should inelude the administrations recommendations on the desirability. feasibility. and requirements for a new fund to make loans for territorial private sector development projects. These two sections represent a major compromise on the part of the sponsors with the administration on an Interior territorial private sector development program. It would delay creation of a loan function for the program that we initially Intended until the administration formally reports on that proposal. It would go ahead with the technical assistance function of the program. This technical assistance program is designed to enhance the ability of entrepreneurs in the territories to tap: Private investment and lending sources. existing Federal business development resources. market protential. and federally created and other business opportunities. Section 201 would authorize the Virgin Islands to issue taxexempt industrial development bonds. Section 202 would authorize American Samoa to issue those bonds. These sections were modified at the request of the Committees on the Budget and Ways and Means. They are necessary to provide these two territories with eligibility to issue IDBs equivalent to that of other territories and the States. The bonds should channel needed investment into their private sectors. These sectors are included through the efforts of our colleagues RON DE LuaO and FOFO SUNLA. Section 203 would authorize the refinancing of the Guam Power Authoritys debt to the Federal Financing Bank which is guaranteed by the Department of the Interior pursuant to law. The refinancing would reduce the interest rate to 7 percent. extend the repayment period from 1990 to 2004. provide for amortization of the debt. and contain no prepayment penalty. It would require rates sufficient to satisfy t he utilitys obligations. II172416 This section is necessary to prevent a financial collapse by the utility. which has already defaulted on Federal and private obligations. and which would result in costs greater than the cost of refinancing to the Federal Government. the territory. and consumers. It should result in more reliable financing and operating of the utility. and more reasonable power rates on Guam. Section 301 would consider the U.S. nationals of American Iamoa and the citizens of the Northern Mariana Islands as U.S. citizens for the purpose of vessel documentation and manning laws. It would also permit the licensing of foreignbuilt vessels under 200 gross tons in weight for fishing In the territorial sea and fishery conservation zone adjacent to the Pacific territories and the coastwise trade of fisheries products in and among the Pacific territories. This section substitutes for title III of the bill as reported at the request of the Committee on Merchant Marine and Fisheries. It would provide narrow but significant exceptions to vessel documentation and manning and fisheries laws that impede the development of a local fishing industry in the Pacific territories. The Pacific territories have a tremendous fisheries potential yet they have not been able to tap this potenLial because of what I believe are unintentionally applied Federal impediments. These impediments are requirements that U.S.-bullt hulls be used for fishing in the waters off the Pacific territories and the coastwise trade of fisheries products between the Pacific territories and requirements for U.S. citizenship for the documentation and operation of vessels. The primary differences between the substitute language and the reported language are that the substitute amends merchant marine and fisheries law rather than territorial law and it limits the eligibility of vessels to those under 200 tons. We have agreed to the substitute on the understanding that the Committee on Merchant Marine and Fisheries will further examine the 200ton limitation and. with the Committee on Interior and Insular Affairs. examine the broader questions raised by the inclusion of my territory of Guam in the coastwise laws while the other Pacific territories are excluded from them. I want to thank our colleague FoFo SUNIA. who is a member of the Committee on Merchant Marine and Fisheries. for his helpful work on this issue. Section 401(a) would authorize the grant of $9.6 million to the government of Guam in fiscal year 1986 or later for improvements to the islands water ystein. These improvements are essen i1i The water shortage in the southern part of the island reached the emergency stage earlier this year with water stringently rationed. It is intended that this authorization fund projects that the territory and the Department of the Interior agree are needed. Section 401(b) would authorize the spending of $600.000 In fiscal year 1985 or later to plan expansion of the runway at the St. Croix. Virgin Islands airport. It also broadens the existing authorization for grants or loans to the Virgin Islands for water and power improvements to include construction of the airport improvements. Expansion of the runway would enable the airport to accommodate aircraft loaded for longdistance flight. facilitating tourism and development of the airport as a connecting hub for the region. Our colleague RON DE Luco has persuaded us of the need for these improvements. Section 401ic) would require the Department of the Interior. in consultation with the Department of Housing and Urban Development. to report to the committees with jurisdiction over the territories within a year of the date of enactment on their recommendations for extending Federal housing programs to American Samoa and creating a special Federal housing program for the territory. It is Intended that the administraLion submit a specific plan for meeting the serious need to finance housing development in the territory. This plan would involve either Inclusion in existing program or the authorization of a special program designed to accommodate the territorys unique property laws or both. Once again. our colleague Poro SuNIA Is responsible for this section. Section 401(d) would authorize the grant of $2 million to the Government of the Northern Mariana Islands for improvement of the territorys water system. Like Guam. the Northern Marianas faces a water crisis. Currently. public water is of a quality so poor that It does not meet health standards. In recommending the authorization of these funds. we are responding to the imperative nature of the problem. We must. however. also state that it is our intent that domestic contractors and workers be employed for this and other federally funded capital improvements In the territory to the extent possible. We expect the Department of the Interior to ensure that this intent is respected. Further. we recommend this assistance confident that the territory will finally meet its obligation to Implement an income tax system that mirrors that of the Internal Revenue Code as does Guam or convince Congress and the President to approve an alternative system by January 1 of next year. Section 501 establishes the title of the Frederick Lutheran Church of St. Thomas. Virgin Islands to a certain parcel of property on that island. The section Is necessary to facilitate development of a home for the aged H 7217 by the church. The church has had undisturbed use of the property by virtue of the treaty by which the United States acquired the territory. The Federal Government has never exercised any control over the parcel. spent any funds to maintain it. or asserted any right to use of it. Our colleague. RON us Luco. authored this section and the one that follows. Section 502 transfers title to Government House in St. Croix. Virgin Islands to the Government of the Virgin Islands. It is consistent with the prior transfer of the territorial chief executives residence on St. Thomas and symbolizes the local governmental autonomy of the territory. It is intended. and we are confident. that the territory will continue to maintain the historic building to proper standards. Section 601(a) would clarify that the authorization of $250.000 per year between fiscal years 1979 and 1983 for each of the Insular areas under the Urban Parks and Recreation Recovery Program continues until appropriations are made. This section Is necessary to resolve the question of whether the special authorization for the Insular areas has expired although the general authorization for the program continues. The question is raised. presumably unintentionally. by language that was used in the Initial authorization. In making this technical correction. I want to recognize the continuing debt of the Insular areas to the programs author and the author of so much of the law that has benefited our Islands. the late Phillip Burton. This omnibus insular areas assistance bill Is in keeping with a legislative tradition that he Initiated and is partially due to his efforts. Many of the provisions in this bill would complete legislative work which he began. That Is particularly true of the next section. It would fulfill an Intent Phillip Burton cared about very much. Section 601(b) would extend the waiver of required matching payments up to $200.000 required under any Federal grant program for American Samoa and the Northern Mariana Islands to Guam and the Virgin Islands. The reasons for waiving matching payments by Amercian Samoa and the Northern Marianas in grant programs applies in the case of Guam and the Virgin Islands as well. Requiring matching results in matching direct Federal assistance with indirect Federal assistance. This unnecessarily burdens territorial governments in terms of dollar cost and time and effort of personnel. It fails to recognize the at least partial responsibility of the Federal Government for the precarious financial positions of the territories. It disqualifies the territories. which have great program needs. from participation in pro-