Date: 1982-09-09
Speaker: WON PAT (democrat)
Chamber: H

Mr. Speaker. if the gentleman will yield. let me say that I take great pride in the amendment in the nature of a substitute which is being offered to the Senates amendrrent of H.R. 5139 today. Our substitute is a good faith compromise with the administration on this omnibus measure for the Insular areas of our Nation. It was produced by my Subcommittee on Insular Affairs after extensive hearings and other work. This included consultation with the insular areas themselves. the administration. and our counterparts on the other side of the Capitol who are responsible for the amendment to our original bill for which we offer a substitute today. The Senate amendment picked up all provisions of H.R. 5139 as it passed the House on December 11. 1981. with the exception of one no longer needed. and added other worthwhile provisions. Our substitute incorporates all aspects of the Senate amendment but one. And. I am greatly disappointed that the opposition of the ae.ministration compels us to delete that provision. Section 401 of the Senate amendment would have reimbursed Guam and the Virgin Islands for the unintentionalbut still devastatingimpacts of the administrations income tax rate reductions. enacted last year. Because Federal law mandates that the tax codes of these territories "mirror" the Federal Code. their treasuries are losing an enormous amount of local revenuesour primary Federal support of themas a result of the tax cut. The Congressional Budget Office estimates this loss at $254 million between fiscal years 1983 through 1985. Despite the administrations promise to correct this situation. there has been no effort to do so. And the territories. of course. are powerless to rectify it themselves. The Senates section 401 of this bill would have authorized the partial compensation of the territorial treasuries to the extent of a total of about $90 million in fiscal years 1983 through 1985. Such assistance is needed because the staggering revenue loss imposed over our objections is contributing to crippling deficits and an inability to locally provide for essential infrastructure. However. the inclusion of this budgetary assistance in the Senate amendment resulted in the threat of an ad. ministration veto of this entire. imperative omnibus legislation. I believe this threat is unwise and callous. but we have accepted the reality of it. As a consequence. we have reluctantly coicluded that it is necessary to delete this needed provision from H.R. 5139. as passed by the Senate. to enable the enactment of other provisions which are. for the most part. supported by the administration. The provisions that we urge be added are described in a statement of explanation which I request be includ. ed in the RECORD at the conclusion of this statement. Most have no cost associated with them. They do include. though. some contribution to the most vital of the infrastructure needs which the federally imposed revenue loss makes impossible for Guam and the Virgin Islands to finance. including projects supported by the administration. The result is that this amendment represents a dramatic savings over the Seante amendment. Whereas the Congressional Budget Office set the budget impact of the Senate amendment at $95.15 million. we have reduced that amount to $19.2 million. As I have indicated. we have proposed eliminating most of the cost of the Senate amendment as an effort to facilitate approval of what we hope will be this Congress major contribution to territorial law. We have acceded to the administrations wishes in restraining authorizations not requested in the Presidents budget. to arrive at an omnibus measure that should be acceptable to the administration. Mr. Speaker. I therefore recommend passage by this House. acceptance of our substitute by the Senate. and approval by the President.