'' ^
^
VIRGIN ISUNDS, GUAM, AND NORTHERN
MARIANA ISLANDS ISSUES
Y
4. R 31/3:104-94
,
INGS
Virgin Islands,
Guan
and northern "-^^jj^
SUBCOMMITTEE ON NATIVE AMERICAN & INSULAR
AFFAIRS
OF THE
COMMITTEE ON RESOURCES
HOUSE OP REPRESENTATIVES
ONE HUNDRED FOURTH CONGRESS
SECOND SESSION
ON
VIRGIN ISLANDS AND GUAM ISSUES
DISPOSITION OF WATER ISLAND IN THE VIRGIN ISLANDS, RESOLU-
TION
433, OF THE GUAM LEGISLATURE, AND CERTAIN
PROVI-
SIONS OF H.R. 3721
JULY 24, 1996—WASHINGTON, DC
VIRGIN ISLANDS AND NORTHERN MARIANA ISLANDS
ISSUES
H.R. 3634 (EXECUTIVE OFFICIALS ABSENCE IN VIRGIN ISLAND), H.R.
3635
(AUTHORITY TO MANAGE
CHRISTIANSTED NATIONAL
HIS-
TORIC SITE) AND FEDERAL-COMMONWEALTH OF THE NORTHERN
MARIANA ISLANDS INITIATIVE ON LABOR, IMMIGRATION, LAW EN-
FORCEMENT, AND RELATED LEGISLATIVE REFORMS
'ilj
JUNE
26, 1996—WASHINGTON, DC
?MSerialNo. 104-94
Printed for the use of the Committee on Resources
VIRGIN ISLANDS, GUAM, AND NORTHERN
MARIANA ISLANDS ISSUES
HEARINGS
BEFORE THE
SUBCOMMITTEE ON NATI\^ AlMERICAN & INSULAR
AFFAIRS
OF THE
COMMITTEE ON RESOURCES
HOUSE OP REPRESENTATIVES
ONE HUNDRED FOURTH CONGRESS
SECOND SESSION
ON
VIRGIN ISLANDS AND GUAM ISSUES
DISPOSITION OF WATER ISLAND IN THE VIRGIN ISLANDS, RESOLU-
TION
433, OF THE GUAM LEGISLATURE, AND CERTAIN
PROVI-
SIONS OF H.R. 3721
JULY 24, 1996—WASHINGTON, DC
VIRGIN ISLANDS AND NORTHERN MARIANA ISLANDS
ISSUES
H.R. 3634 (EXECUTIVE OFFICIALS ABSENCE IN VIRGIN ISLAND), H.R.
3635
(AUTHORITY TO MANAGE
CHRISTLANSTED NATIONAL
HIS-
TORIC SITE) AND FEDERAL-COMMONWEALTH OF THE NORTHERN
MARIANA ISLANDS INITIATIVE ON LABOR, IMMIGRATION, LAW EN-
FORCEMENT, AND RELATED LEGISLATIVE REFORMS
JUNE 26, 1996—WASHINGTON, DC
Serial No. 104-94
Printed for the use of the Committee on Resources
U.S. GOVERNMENT PRINTING OFFICE
27-245 cc
WASHINGTON
: 1996
For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
ISBN 0-16-053845-9
COMMITTEE ON RESOURCES
DON YOUNG, Alaska, Chairman
W.J. (BILLY) TAUZIN, Louisiana
JAMES V. HANSEN, Utah
JIM SAXTON, New Jersey
ELTON GALLEGLY, CaUfornia
JOHN J. DUNCAN, Jr., Tennessee
JOEL HEFLEY, Colorado
JOHN T. DOOLITTLE, CaUfornia
WAYNE ALLARD, Colorado
WAYNE T. GILCHREST, Maryland
KEN CALVERT, CaUfornia
RICHARD W. POMBO, CaUfornia
PETER G. TORKILDSEN, Massachusetts
J.D. HAYWORTH, Arizona
FRANK A. CREMEANS, Ohio
BARBARA CUBIN, Wyoming
WES COOLEY, Oregon
HELEN CHENOWETH, Idaho
LINDA SMITH, Washington
GEORGE
P. RADANOVICH, CaUfornia
WALTER B. JONES, Jr., North CaroUna
WILLIAM M. (MAC) THORNBERRY, Texas
RICHARD (DOC) HASTINGS, Washington
JACK METCALF. Washington
JAMES B. LONGLEY, Jr., Maine
JOHN B. SHADEGG, Arizona
JOHN E. ENSIGN, Nevada
GEORGE MILLER, CaUfornia
EDWARD J. MARKEY, Massachusetts
NICK J. RAHALL
II, West Virginia
BRUCE F. VENTO, Minnesota
DALE E. KILDEE, Michigan
PAT WILLLyVIS, Montana
SAM GEJDENSON, Connecticut
BILL RICHAPJDSON, New Mexico
PETER A. DeFAZIO, Oregon
ENI F.H. FALEOMAVAEGA, American
Samoa
TIM JOHNSON, South Dakota
NEIL ABERCROMBIE, Hawaii
GERRY E. STUDDS, Massachusetts
SOLOMON P. ORTIZ, Texas
OWEN B. PICKETT, Virginia
FRANK PALLONE, Jr., New Jersey
CALVIN M. DOOLEY, CaUfornia
CARLOS A. ROMERO-BARCELO, Puerto
Rico
MAURICE D. HINCHEY, New York
ROBERT A. UNDERWOOD, Guam
SAM FARR, California
PATRICK J. KENNEDY, Rhode Island
Daniel Val Kish, Chief of Staff
Elizabeth Megginson, Chief Counsel
Christine A. Kennedy, Chief Clerk /Administrator
John Lawrence, Democratic Staff Director
SUBCOMMITTEE ON NATIVE AMERICAN & INSULAR AFFAIRS
ELTON GALLEGLY,
DON YOUNG, Alaska
WAYNE T. GILCHREST, Maryland
WALTER B. JONES, Jr., North CaroUna
RICHARD (DOC) HASTINGS, Washington
JACK METCALF, Washington
JAMES B. LONGLEY, Jr., Maine
CaUfornia, Chairman
ENI F.H. FALEOMAVAEGA, American
Samoa
DALE E. KILDEE, Michigan
PAT WILLIAMS, Montana
TIM JOHNSON, South Dakota
CARLOS A. ROMERO-BARCELO, Puerto
Rico
ROBERT A. UNDERWOOD, Guam
Tim Glidden, Counsel
T.E. Manase Mansur, Professional Staff
Christopher Stearns, Democratic Counsel
(II)
CONTENTS
VIRGIN ISLANDS, GUAM ISSUES
Page
Hearing held:
July 24, 1996
1
H.R. 3721
33
Statements of Members:
Gallegly, Hon. Elton, a U.S. Representative from Ohio
1
prepared statement
4
Underwood, Hon. Robert A., a U.S. Delegate from Guam
4
Statements of witnesses:
Barrett-Anderson, Senator Elizabeth, Guam Legislature
21
Prepared statement
74
Bordallo, Lt. Governor Madeleine Z., Guam
15
Cristobal, Senator Hope, Guam Legislature
23
Faleomavaega, F.H., (prepared statement)
13
Lutali, A. P., (prepared statement)
70
Pangelinan, Senator Vicente C, Guam Legislature (prepared statement)
.
94
Stayman, Allen P. Director of Insular Affairs, Department of Interior
2
Prepared statement
58
Communication submitted:
Resolution No. 433(LS)
84
United Nations General Assembly Report
97
VIRGIN ISLANDS AND NORTHERN MARIANA ISLANDS
Page
Hearing held June 26, 1996
120
Text of:
H.R. 3634
185
H.R. 3635
188
Statements of Members:
Gallegly, Hon. Elton, a U.S. Representative from California
120
prepared statement
120, 165
Frazer, Hon. Victor, Delegate, Territory of the Virgin Islands
121
Hastings, Hon. Doc, (prepared statement
)
142
Statements of witnesses:
Aloot,
Sebastian, Attorney
General, Commonwealth Northern Mariana
Islands
161
Prepared statement
231
Babauta, Juan
N.,
Resident
Representative, Commonwealth Northern
Mariana Islands
159
Prepared statement
209.
Kennedy, Roger G., Director of National Parks, Department of the Inte-
rior
129
Prepared statement
196
Lewis, WUma A., Inspector General of Interior
144
Prepared statement
199
McPhetres, Samuel F., President, Saipan Chamber of Commerce
173
Prepared statement
243
Schneider, Hon. Roy L., M.D., Governor of Virgin Islands
122
Prepared statement
191
Stajonan, Allen
P., Director of Insular Affairs, Department of the
Inte-
rior
128,
143
Prepared statement
194
(III)
rv
Page
Communication submitted:
Babauta, Juan N,: Letter of July 10, 1996 to Hon. Elton Gallegly
378
Federal-CNMI Initiative on Labor Immigration, & Law Enforcement, Re-
port of June 1996
251
Fleming, Evelyn C: Letter of May 30, 1996 to Hon. Froilan C. Tenorio
374
Lewis, Wilma A.: Letter of July 10, 1996 to Hon. Elton Gallegly
352
San Nicolas, Jose C: Memorandum of July 9, 1996 to Juan N. Babauta
...
375
Stayman, Allen P.:
Answer to question for July 24, 1996
391
Answer to question for July 26, 1996
396
Tenorio, Froilan C: Letter of June
1, 1996 to Hon. Diego T. Benavente
and Hon. Jesus R. Sablan
373
Tenorio, Froilan C: Letter of May 30, 1996 to Peter J. Scharwark
380
Additional material supplied:
Ferrara, Peter: Tinkering with the success of liberty of Oct.
10, 1995
298
House
Bill No.
10-152, H.D.I
of Commonwealth Legislature, Northern
Mariana
361
House Joint Resolution No. 10-1 of Commonwealth Legislature, Northern
Mariana
327
I.G. Questions regarding the Audits in the NMI
146
Proposed Constitutional Amendment
359
Questions for Department of Justice
157
Questions for Wilma Lewis, Inspector General
145
Questions Regarding the Minimum Wage
157
Responses to Questions from Richard N. Reback, Department of Interior
.
345
Responses to Questions from Wilma A. Lewis, Department of Interior
351
1985 Omnibus Territories Legislation Herring
386
Opinion: Pacific Daily News, dated August 30, 1996
389
VIRGIN ISLANDS, AND GUAM ISSUES
WEDNESDAY, JULY 24, 1996
House of Representatives, Subcommittee on Native
American and Insular Affairs, Committee on Re-
sources,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:30 p.m., in room
1334,
Longworth
House
Office
Building,
Hon.
Elton
Gallegly
(Chairman of the Subcommittee) presiding.
STATEMENT OF HON. ELTON GALLEGLY, A U.S. REPRESENTA-
TIVE FROM CALIFORNIA; AND CHAIRMAN, SUBCOMMITTEE
ON NATIVE AMERICAN AND INSULAR AFAIRS
Mr. Gallegly. This oversight hearing will cover the longstand-
ing disposition of Water Island
in the Virgin
Islands, Resolution
433 of the Guam Legislature, and certain provisions of H.R. 3721.
I
welcome
our
distinguished
visitors
from Guam,
Lieutenant
Governor Bordallo and Senators Barrett-Anderson and Cristobal.
The disposal of Water Island was identified by the Committee on
Resources as a priority issue in the Committee's Oversight Plan for
the
104th Congress. There are many American
citizens who are
still waiting to gain
title with the land where their homes stand.
It is unconscionable that the Department has taken nearly 4 years
to conclude this matter. At a minimum, the Department of Interior
should give clear timeframes for resolving each aspect for the dis-
posal of Water Island.
The legislature of Guam has enacted Resolution 433, which
re-
quests that the Congress give Guam the authority to determine the
method
of selecting their attorney
general. No doubt there
is a
compelling reason the legislature identified the selection of the at-
torney general as a matter of warranting a change in the current
law. However,
it is essential for Congress to hear the views of both
the executive and legislative branches of Guam.
My
colleague and ranking member
of the Subcommittee from
American Samoa has recently introduced legislation with a number
of measures affecting the insular areas of the United States. While
a number of these were covered in other earlier congressional hear-
ings,
I expect the witnesses
will comment on the provisions per-
taining to their territory.
The administration will comprise the first three panels and will
be represented by Allen Stayman of the Office of Insular Affairs
one of my favorite offices.
(1)
The second panel will include the Lieutenant Governor of Guam,
Madeleine
Bordallo,
presenting testimony on behalf of the Gov-
ernor of Guam.
The last panel includes two senators from Guam, Senator Eliza-
beth Barrett-Anderson, and Senator Hope Cristobal.
I understand
Senator Barrett-Anderson has been appointed by the Speaker of
the Guam Legislature, Don Parkinson, to represent the legislature
regarding the proposed change in the Organic Act of Guam regard-
ing the selection of the attorney general.
I also understand that
Senator
Cristobal has
a
special
interest
in
the
proposed Guam
Land Act.
[H.R. 3721 may be found at the end of hearing.]
Mr. Gallegly. We will now begin with the first panel. We have
what sounds
like
a
series
of
votes,
and
before
I
yield
to
Mr.
Stayman,
I apologize for coming in
late; there was a
little glitch,
I guess, in some meetings, although
I will take total responsibility
for
it and deal with that appropriately later. But in any event, as
you heard,
it appears there
is a series of votes over on the Floor,
and due to the current leadership's position on the voting rights of
my delegate friends
here, they
will have a better opportunity to
continue this meeting than I will have.
So with that, if you would please excuse me, Mr. Stayman,
I will
yield
the
gavel
to my good
friend,
the
delegate from American
Samoa, Mr. Faleomavaega.
Mr. Stayman. Thank you.
STATEMENT OF ALLEN P. STAYMAN, DIRECTOR OF INSULAR
AFFAIRS, U.S. DEPARTMENT OF THE INTERIOR
Mr. Stayman. Mr, Chairman, and members of the Subcommittee,
I am pleased
to appear before you
for this oversight hearing on
Water Island, election of Guam's attorney general, and H.R. 3721.
The Department of the Interior has been the owner and lessor
of Water Island for more than 40 years. Since before the expiration
of the master lease in 1992, the Department has sought to dispose
of its interest in the island. The process has been long and ardu-
ous. We are
confident, however, that the process
is coming to a
close, with a fair and reasonable result.
On May 23rd, the Department outlined
its plan for disposal of
its interest in Water Island. Each sublessee will have the oppor-
tunity to purchase fee simple title to the subleased land on which
his or her Water Island residence is located.
In addition, the Government of the Virgin Islands will be given
fee simple title to non-subleased portions of Water Island for public
purposes in exchange for the assumption of certain responsibilities,
including provision of municipal services, cleanup of storm damage,
and establishment of conservation easements.
In resolution of a suit by the master lessee against the Depart-
ment, the parties submitted a formal settlement by which the De-
partment will pay the master lessee $7.5
million
for the
lessee's
possessory interest in Water Island.
With the judge's expected approval of the settlement on August
2nd, we
believe
that
this
long Water Island
transfer process
is
drawing to a close.
The Legislature of Guam in Resolution 433 requests that the Or-
ganic Act of Guam be amended to require election of the attorney
general.
I believe that the issue of appointment or election of the
attorney general
is a local self-government issue which should be
decided in Guam. Accordingly, the Department takes no position on
the matter at this time. We would, however, likely support a posi-
tion based on consensus in Guam.
Turning
to H.R.
3721,
the
administration has no
objection
to
Title I regarding delegate balloting.
Title II would establish an American Samoa study commission to
conduct a comprehensive study of American Samoa's political sta-
tus. While the administration supports the objective of Title
II,
its
general policy discourages the establishment of commissions. More-
over,
I believe that initial discussions on political status should be
undertaken
at the
local
level and
that the Federal Government
should become involved only after some
local consensus has been
established.
For example, both Guam and the Virgin Islands established local
status commissions to examine status and constitution questions.
Funding for such a local initiative could be made available from the
Department's technical assistance program.
Title III includes a proposal authorizing up to $10 million a year
for fiscal years 1998 through 2003 for capital development in Amer-
ican Samoa. A multi-year funding source was identified by the De-
partment and became law earlier this year, as section 118 of Public
Law 104-134. The administration, in response to a letter from Del-
egate Faleomavaega, estimated that American Samoa will receive
a minimum of $9.1 million annually from this guaranteed source
beginning
in
fiscal year
1998. The proposed authorization would
cap funding from this source at $10 million annually.
The administration endorses the concept of Title V, clarification
of Federal program matching. We do
suggest,
however,
that
to
avoid possible confusion, the provision be redrafted
to conform to
language adopted earlier this month by the Senate Committee on
Appropriations.
Section 602 authorizes Guam to acquire Federal excess lands on
the island at no cost and ahead of other Federal agencies. It would
waive provisions of the National Environmental Policy Act and the
Endangered Species Act, as well as other laws.
Section 602 also makes no provision for habitat conservation and
threatened/endangered species protection in the event of transfer to
the Government of Guam.
For these reasons, we strongly oppose section 602 as introduced.
However, the Department
is prepared to enter into discussions to
resolve these concerns based on two principles. First, any unneeded
Federal lands that are outside the boundary of the Guam National
Wildlife Refuge and refuge overlay lands could be transferred
to
the Government of Guam provided that such transfers are in ac-
cordance with the National Environmental
Policy Act and other
Federal laws.
Second, a process could be established to develop a habitat con-
servation plan
for private or Guam owned
lands,
in conjunction
with the Government of Guam, the Department of Defense and pri-
vate
interests,
to
(1) maximize the amount of unneeded Federal
land to go
to the Government of Guam and
(2) provide adequate
protection to threatened and endangered species and their habitat
in accordance with the Endangered Species Act.
This planning approach would allow all three parties to work to-
gether to determine, after considering all lands on Guam, adequate
habitat needed to meet threatened and endangered species require-
ments. It is possible that private lands. Government of Guam lands
with compatible uses, military lands not expected to become excess
or surplus, may meet the habitat needs of many threatened and en-
dangered species. Other Ismds could then be freed for other uses.
We look to Guam for an expression of interest in developing such
a habitat protection agreement.
The
administration
supports enactment
of section
603, which
would repeal the so-called Brooks Amendment.
Finally, Title VIII would establish a six-member commission to
evaluate future economic options for the Virgin Islands. Again, the
administration supports the
objective of Title VIII. However,
ad-
ministration policy is generally against the creation of new commis-
sions.
Alternatively, we would recommend that the Office of Insular Af-
fairs and Governor Schneider explore the possibilities of an agree-
ment for technical assistance to achieve the purposes of Title VIII.
Mr. Chairman, thank you for this opportunity to present the ad-
ministration's
views.
I
look
forward
to
working
with
the
Sub-
committee members and to responding to your questions.
Also,
let me ask that my
full written statement be included as
a part of the record.
Mr. Faleomavaega. [Presiding.] Without objection.
[The statement of Mr. Stayman may be found at end of hearing.]
Mr. Faleomavaega. The chair recognizes the gentlemen from the
Virgin Islands to be part of the hearing process this afternoon and
certainly would like to ask both members if they have any opening
statements.
Congressman Frazer?
Mr. Frazer. No, Mr. Chairman, I have no opening statement.
Mr. Faleomavaega. Mr. Underwood?
STATEMENT OF HON. ROBERT A. UNDERWOOD, A DELEGATE
IN CONGRESS FROM THE TERRITORY OF GUAM
Mr. Underwood. Thank you, Mr. Chairman.
I have an opening
statement which I will submit for the record.
Mr. Faleomavaega. Without objection.
Mr. Underwood.
I also have some communication from the Com-
piler of Laws on Guam on the issue of the elected attorney general
that I would like to submit for the record as well as a Pacific Daily
News Editorial on the land situation.
Mr. Faleomavaega. Without objection.
[The prepared statement of Hon. Robert A. Underwood follows:]
Statement of Hon. Robert A. Underwood, A U.S. Delegate from Guam
Mr. Chairman,
I commend you for your leadership in holding this hearing today
and for your continued commitment to working with the Delegates on issues impor-
tant to our communities.
I also wish to note and congratulate the Chairman for his
introduction of H.R. 3879, the Northern Marianas Delegate Act. This historic
bill
is also cosponsored by Chairman Don Young, Subcommittee Ranking Member Eni
Faleomavaega and myself. I look forward to welcoming a new coUeagus representing
Guam's northern neighbors in the 105th Congress.
This subcommittee
continues
to make
substantial progress on issues
affecting
Guam.
I am pleased that Ranking Member Faleomavaega included the provisions
of the Guam Land Return Act in Title VI of his
bill, H.R. 3721, and
I thank Mr.
Faleomavaega for his support for the return of excess federal property to the people
of Guam. This provision would amend the Federal Property Act by changing the
order of priority for receiving excess federal property. Under this amendment, the
Government of Guam would have the first right of refusal for such lands.
We have been working deligently with the Committee on Resources and our Sen-
ate counterparts on Guam land issues in the 103d and 104th Congresses. The Guam
Land Return Act represents another important milestone in achieving a comprehen-
sive solution to Guam's land issues.
As this committee knows from its involvement in land legislation, over one third
of the land on Guam
is owned by the federal government. Most of these land hold-
ings belong to the military. The end of the Cold War and military downsizing has
given us an opportunity to make progress in resolving land issues that trace their
origins to the manner in which the lands were originally acquired by the military
after World war
II. The Guam Land Return Act
is important legislation that will
help us to resolve the historical injustices of the land takings.
I am aware of opposition to this title by the Department of the Interior, ostensibly
over concerns over the endangered and threatened species on Guam. Interior must
think that the birds on Guam are extremely intelligent—they are rare species that
can read land deeds. Interior would have you believe that if the land deeds trans-
ferred from the military to GovGuam, then the birds would refuse to breed.
I think
Interior needs to get out more often.
I would also point out that in a hearing held on July
11, by the Subcommittee
on Fisheries, Wildlife and Oceans on non-indigenous species. Dr. Tom Fritts, Direc-
tor of the National Biological Survey, responded on the record to my question about
the habitat issue. He acknowledged that the
level
of development
in Guam and
Saipan is similar, and that the birds thrive on Saipan. The real problem on Guam
is not lack of habitat,
it
is the brown tree snake. Dr.
Fritts further answered on
the record in response to a second question that the U.S. Fish and Wildlife Service
(USFWS) has only committed approximately $40,000 of its own funds to brown tree
snake eradication. As
I have pointed out before if the Fish and Wildlife Service was
truly committed to Guam's endangered species,
it would put
its money where
its
mouth is—in brown tree snake eradication.
The Guam Land Return Act would not undo what the Fish and Wildlife has done
in acqmring 370 acres of land at Ritidian for its wildlife refuge—although that
is
not a bad idea for this committee to consider. This provision gives Guam the first
right of refusal for lands declared excess in the future.
This committee is also accepting testimony regarding a request by the 23rd Guam
Legislature to amend the Organic Act of Guam to allow for the election of the Attor-
ney General.
I believe that the committee should defer action this request until we
have received additional input from the Guam Judicial Council and other interested
parties. We should be careful to ensure that changes
to the Organic Act are not
made in a way to suggest that the Congress is involving itself in the poUtics of the
moment on Guam.
Mr. Chairman, as we consider issues that may be packaged in a House Omnibus
Territories bill,
I would urge this committee to consider including a Title for Guam
war restitution. We had a very good hearing on this issue in the 103rd Congress,
and earlier in this Congress on the Chairman's
bill, H.R. 602, that included a war
restitution provision.
I believe that we are very close to resolving all the issues in
the proposed war restitution amendment, and I commend the Chairman for his con-
tinued support of our efforts on this issue.
I hope that we can include war restitu-
tion in any House Omnibus
bill, and
I know that this committee appreciates the
great impact that a resolution of this issue will have on the people of Guam.
Again, Mr. Chairman,
I wish to express my gratitude for your leadership on terri-
torial issues. We have a
fiill plate of issues to address today.
I hope we can complete
work on these issues so that we can clear the deck for our consideration of another
bill very important Guam, H.R. 1056, the Guam Commonwealth Act, in the remain-
ing days of the 104th Congress and the 105th Congress.
Mr. Faleomavaega.
I would
like to turn
to Mr. Frazer for his
questions.
Mr. Frazer. Thank you, Mr. Chairman.
Mr. Stayman, we know that the leases expired on Water Island
in
late
1991, and you are quite aware of the anxiety of the
resi-
dents of that island. Could you
tell me, within a reasonable time-
frame, when
I can report to the residents of the island that they
will in fact be receiving fee simple titles.
Mr. Stayman, Yes. What we have explained to them in earlier
meetings, but
it would be appropriate, of course,
to update them,
is that we intend to undertake a three-phase disposal of the island.
What is holding us up
is the suit in the Federal claims court. Re-
cently, the judge indicated that he
will enter the settlement be-
tween the Department and the former master leaseholder on or be-
fore August 2nd. At that time, we will send letters to each of the
sublessees, offering them the opportunity to buy the sublease on
which their residence exists.
We expect in the September timeframe, we will transfer to the
Government of the Virgin Islands certain areas that would be for
public use—about 50 acres. Then, the third phase would be early
next year, when any residual lands would be transferred
to the
Government of the Virgin Islands.
Mr. Frazer.
It
is my understanding that a company
in Bryn
Mawr, Pennsylvania leased about 156 acres and that there was an
agreement between the Department of the Interior and this com-
pany that 40 acres would have been
set aside
for something like
a preserve. Could you tell me
if that area
is one of the areas that
is going to be considered transferrable to the Virgin Islands?
Mr. Stayman.
I am
pretty
certain from your
description
that
what we are talking about is the so-called Spratt Bay Point, which
is about 40 acres, and
it is our expectation that that will be trans-
ferred
to
the Government
of the Virgin
Islands
in phase
three
when many of the conservation lands or conservation easements
will be transferred. We are holding that to the third phase because
we would also
like to put in that third phase those lands which
sublessees do not want to buy.
Mr. Frazer. Are you aware that there
is a figure that
is being
thrown around that the selling price will be about $17,500?
Mr. Stayman. Yes. We have informed all interested parties—that
is,
all sublessees—that that will be the asking price per acre once
we are able to make the offer after the court acts.
Mr. Frazer. And there
is an understanding that the sublessees
would be given the choice of first refusal on the subleases that they
had, which are now expired, but would the rest of the land be open
to anyone who
is interested at this $17,500, or does
it relate only
to the sublessees?
Mr. Stayman. The offer will only be extended to the sublessees.
That
is why we are planning for this third phase. There will obvi-
ously be some sublessees who do not want to buy. Those lots will
be transferred to the Government of the Virgin Islands.
Mr. Frazer. There is a misunderstanding by many people in the
Virgin Islands that the lards are not subject to past subleases and
that they will be available for sale to anyone interested at $17,500;
that is not correct?
Mr. Stayman. That is not correct.
Mr. Frazer. Thank you.
Mr. Faleomavaega. The gentleman from Guam.
Mr. Underwood. Mr. Stayman, my questions obviously pertain
to the issue of most concern to me, that
is, how to deal with the
Federal excess lands on Guam.
In your testimony a few weeks ago in the Senate hearing on this
bill, you
indicated the
administration's unwillingness
to support
this bill, and today you come with essentially the same message ex-
cept for some ideas on how this can perhaps be dealt with. You
talked about developing a habitat conservation plan. Based on your
conversations with Fish and
Wildlife
Service,
could you
give us
some examples of what this may mean in terms of freeing up some
land?
Mr. Stayman. Yes. Stepping back a
little
bit, the habitat con-
servation planning process is one that there is quite a bit of experi-
ence with under this administration—I believe over 100 such plans
have been approved, and a couple additional hundred are in nego-
tiation.
The administration believes that habitat protection and economic
development need not be mutually
exclusive.
If
all
parties who
have an interest in lands, in this case in Guam, could determine
which lands are necessary for the critical habitat needs of threat-
ened and endangered species, then that
it may be possible to free
up some of the lands. Once the Fish and Wildlife Service has iden-
tified interests necessary for species protection, an increase in the
amount of land that could be transferred to Guam is possible.
There
is just one other example that
I might give that might
make
it a
little
clearer.
In my understanding of the situation
in
Guam, there are,
I believe, eight bird and bat species that are en-
dangered and for which the Fish and Wildlife Service is looking for
habitat. One of those
species
utilizes golf courses.
If there
is an
agreement, which satisfies the habitat needs of that particular spe-
cies, then there would no longer be a need on the part of the Fish
and Wildlife Service to get excessed DoD lands.
Mr. Underwood. Then, based on what you are sa5dng, if the peo-
ple on Guam were willing to engage in this process, and you took
a significant amount of acreage—let us say we are talking about
5,000 or 6,000 acres, for example—would the administration then
support the process for those particular lands identified in the leg-
islation?
Mr. Stayman.
I do not know that
I understand the 5,000. that
you are talking about.
Mr. Underwood. OK. For the sake of argument,
let us say the
lands
that
are down
in southern Guam
in the naval magazine
area—and
I know we have had some discussion on this particular
property, right, that there are a couple of species out there, one of
which inhabits caves, and that would be dealt with in a way that
would allow that land to be freed for the purpose of releasing that
land
to
the Government Guam—assuming that there was some
successful understanding of how to deal with that land, would you
then support the process of return that is identified in this legisla-
tion, or do you still have reservations about the way that the trans-
fer is proposed here?
Mr. Stayman. If this process
is fully successful, my understand-
ing
is that—and when
I say
"fully successful,"
all habitat needs
would be met through a plan, and they would have confidence that
8
all parties would be supporting that plan—they would not feel
it
necessary to ask for excess land because the plan would meet their
needs.
Mr. Underwood. OK. Remember that the legislation here does
not specifically refer to Fish and Wildlife Service, but
it does refer
to putting the Government of Guam at the head of the line for the
return of Federal excess land. So the question
I am asking is that
I am trying to understand how you see this process working. What
I am hearing you say—and maybe
I am wrong—what I am hearing
you say
is that the adm^inistration does not necessarily object
to
putting Guam at the head of the line if a habitat conservation plan
can be arranged—or is that reaching too far?
Mr. Stayman.
I think that is reaching a httle far.
I can be honest
to say that there
is a lot of discussion on this within the adminis-
tration and that the theory of the habitat conservation plan would
be worth pursuing even
if it were not 100 percent successful;
if it
were 50 or 80 percent successful, that would mean perhaps 50 or
80 percent of the land which Fish and Wildlife Service is currently
seeking for species could be gotten.
Mr. Underwood. Well, then,
it would seem to me that the ad-
ministration's position has not really changed significantly in terms
of the process that we are identifying here. What
it seems that you
are identifying in terms of trying to negotiate an arrangement or
arrive at a habitat conservation plan
is open to us regardless and
independent of this legislation. We could begin this process tomor-
row, could we not?
Mr. Stayman. Certainly, yes.
Mr. Underwood.
Certainly. So what you are offering could be
done independently of the legislation, but the question that
I was
asking was related specifically to the legislation. Is the administra-
tion saying that the legislation
is fine assuming that we go into a
habitat conservation plan, and the answer that
I am hearing you
say is no.
Mr. Stayman. Yes. The answer is no.
Mr. Underwood. Well, then,
I would submit that nothing has
really changed that significantly, other than a willingness
to
dis-
cuss the issue, and
I hope that that
is always part of the process.
There
is no need
to belabor the
issue on the return
of excess
lands by the Federal Government to Guam other than to note for
the record that what
I am talking about here, as
is well-known to
you, Mr. Stayman,
is a very
difficult historical problem that has
been left to us.
The problem that I think we will have in engaging in the process
of working out a habitat conservation plan
is that we have a num-
ber of competing interests. We have the issues of historical injus-
tice, we have the problem with how the land was originally taken,
we have attempts to try to deal with that. We have pressing needs
on Guam, and
to propose that a habitat conservation plan take
precedence on that is to put that plan at the head of the list of all
those competing considerations.
I think most people on Guam are
realistic enough, and
I
cer-
tainly am realistic enough to understand that the concerns of the
Fish and Wildlife Service are important and should be considered,
but
I do not think in the sum total of things that they should be
the primary consideration or be,
if you would, the head of the list
on this particular issue.
Thank you, Mr. Chairman.
Mr. Faleomavaega.
I have just a couple of questions as a follow-
up to Congressman Underwood's questions, Mr. Stayman.
As
I read this return of Federal excess Ismds to the Government
of Guam, you have competing agencies—Fish and Wildlife Service,
the Department of Defense and the Department of the Interior.
If
I were to place a priority in terms of our national interest in these
so-called Federal excess lands, which agency do you think will have
the final shot on this in terms of outlining the final position of the
administration if there are excess lands to be transferred to Guam?
Mr. Stayman. Well, right now, under the
Mr. Faleomavaega. You
are making
the
statement
that
the
habitat conservation sounds really nice and good, but
I am of the
opinion that it is our strategic and military interests that will prob-
ably have a higher consideration when
it comes to really bearing
down,
if in fact that day ever comes, these excess lands will ever
be transferred back to the Government of Guam.
Mr. Stayman. The participation of the Department of Defense in
this process would not be so much with respect to the excess lands,
but with respect to those lands that they would retain. And if they
can meet some of Fish and Wildlife Service's concerns with lands
that they are going to retain, then Fish and Wildlife Service may
be more
willing
to
not ask under the
Federal Property Act
for
transfer of the excess lands.
Mr. Faleomavaega.
If there were a national emergency today,
Mr. Sta3nTian, do you think Fish and Wildlife is going to have some
sense of priority when DoD says, "We need that piece of land to put
some military equipment; the heck with Fish and Wildlife"? Do you
think that this
all washes out when
it comes to a national emer-
gency?
Mr. Stayman. Oh,
yes,
it
does. National
security takes
prece-
dence, but for now, these are lands that DoD says they do not need.
Mr. Faleomavaega.
I see.
Mr. Stayman. And under the current law,
it
falls
to the next
agency which has an interest, and as far as
I know, there
is only
one, and that is the Fish and Wildlife Service.
Mr. Faleomavaega. So that for now, the opinion of the Depart-
ment of the Interior is that habitat and conservation and Fish and
Wildlife seem to be co-equal as far as any consideration of the De-
partment of Defense.
Mr. Stayman. No. As
I just said,
if the Department of Defense
says they no longer need the land, then
it goes to the next Federal
agency which has an interest, and at this time, the only such agen-
cy of which I am aware is Fish and Wildlife Service.
Mr. Faleomavaega. And as far as that line of priority goes, then,
the Government of Guam is the least important as far as any con-
sideration for its needs.
Mr. Stayman. Under the current law, if no Federal agency want-
ed
it—and
in the case of much of this land, there
is no Federal
agency that wants
it—the Government of Guam would be next in
line.
10
Mr. Faleomavaega.
It would be my earnest hope that the De-
partment of the Interior will be supportive of the request based on
the very reason why we drafted this legislation, which
is to give
the Government of Guam more access to any excess land that the
Federal Government does not need.
I would like to ask
if
it
still
bears true today.
Is
it true that one-third of the island
is owned
by the military, one-third
is owned by the
local government, and
the other one-third is owned by business interests?
Mr. Stayman. Yes, that is my understanding.
Mr. Faleomavaega. And with that position,
if the Government
of Guam has a need for more economic
self-sufficiency and more
development, do you think that we are being somewhat unfair that
the military
really has a need
for one-third
of the whole island
being used? Does it really justify itself that the military has a need
for one-third of that whole island?
Mr. Stayman.
I would have to say that the military has endeav-
ored to try to minimize the amount of land.
I believe—and the Con-
gressman can correct me—that they used to control one-half of the
island, and the prospect
is that they will be going to one-quarter
and that they are making an effort to release those lands which are
not absolutely essential to their mission.
Mr. Faleomavaega. Would the Department of the Interior be at
least supportive of the spirit of this legislation, which
is simply to
give more access
to the excess land,
if there
is excess land, that
could be identified for the needs of the Government of Guam?
Mr. Stayman. Yes, absolutely, but our concern and our proposal
is to enter into a process where that goal, maximizing the land to
the Government of Guam,
is balanced with a goal with which the
Department is charged under law, and that is protecting the habi-
tat and
species that are threatened and endsmgered. We believe
that
if we enter into a process in which
all parties—in this case,
the Department of Interior, the Department of Defense, the Gov-
ernment of Guam and private landowners on Guam—examine
all
lands in Guam, keeping in mind those two goals, they will come
out with a solution which
is much better for everyone than the
prospect or the process we are currently facing, which is that Fish
and Wildlife Service is looking to excess military lands in order to
assist them in meeting their mission.
I go back again to the example of the moorhen. Here is a species
that can do well against the snake, can do well in any water envi-
ronment or marshland environment. There are probably many pri-
vate landowners on Guam—I use the example of a golf course
who may be able to provide habitat needed for this species. If such
an agreement can be entered into, and the Fish and Wildlife Serv-
ice has confidence that that will meet their needs and the species'
needs, then they do not have to seek excess military land. But we
have not gone through that process yet.
Mr. Faleomavaega. Well, you say "the process," and maybe the
gentleman from Guam could help me, but how long has this proc-
ess been going on—6 years?
Mr. Stayman. No. This process has not started. We are proposing
to Guam that we enter into this. There was an effort many years
ago to do this, but at that time, the Government of Guam was not
interested. We are hopeful that given the success of the Habitat
11
Conservation Plan process
in other areas of the country—a very
good track record—that the Government of Guam might be
per-
suaded that this
is a process worth entering into.
I fully recognize
that
it
is unlikely to be 100 percent successful, but
I also do not
believe that
if we do otherwise we would be totally unsuccessful.
I think there are opportunities to reduce the demands of the Fish
and Wildlife Service on excess military lands on Guam, and I think
we should enter into that process.
Mr. Faleomavaega. Can you give us your best judgment as to
how long the process will take,
if you think there
is a possibility
that the process can be completed and done without having to go
through Federal legislation to kind of push you to produce some re-
sults?
Mr.
Stayman. Accompanying me today
is Mr.
Gerry Jackson
from the Fish and Wildlife Service, who is quite familiar with this.
Could
I just consult with him and ask how long, on average, these
processes have taken in other areas?
Mr. Faleomavaega. While I welcome Mr. Jackson's presence, the
problem is that we do not have anybody here representing the De-
partment
of Defense, and
I
suspect that they are just as much
hardliners as far as giving up any inch of whatever land the mili-
tary feels is more important than even habitat. So I would welcome
Mr. Jackson's opinion, but just give me a good guess as to how long
you think the process is going to go, without having to go through
the legislation that we are proposing here.
I sure hope it is not an-
other 6 years.
Mr. Stayman. Mr. Jackson informs me that if all things go
rel-
atively smoothly, with a commitment by all parties to these two ob-
jectives, a year is a reasonable timeframe for the process.
Mr. Faleomavaega. We could resolve this in one year's time?
Mr. Stayman. Well, again, we are talking about a process that
I do not think should be regarded as an all-or-nothing process. We
have some dozen species here, and
I doubt that we could come up
with a solution for all dozen. But if we come up with a solution for
half of them, that is going to have clear benefits to the Government
of Guam.
Mr. Faleomavaega.
I yield to the gentleman from Guam.
Mr. Underwood. Thank you.
I just wanted to touch on the issue
of the connection with the Department of Defense since, in my ca-
pacity as a member of the Armed Services Committee, we once took
a trip to Fort Bragg to watch some maneuvers, and we noticed that
there were some very carefully and strategically placed ribbons for
tanks and the soldiers to avoid certain trees where a certain wood-
pecker apparently lives. So indeed, some of these laws do apply to
defense activities.
Mr. Sta3niian, you raised an issue with regard to this particular
situation, and let me try to characterize
it as best
I understand
it.
The Department of Defense wants the land to be turned over to the
people of Guam as quickly as possible, and that has always been
their expression, but Fish and Wildlife—and in your statement, you
mentioned DoD's concern about restrictions on land that they will
continue to hold, because absent the habitat conservation plan that
is being proposed,
it is conceivable that Fish and Wildlife, through
12
its own mechanisms, may impose restrictions on the use of prop-
erty that DoD will continue to hold into the foreseeable future.
This presents a very interesting scenario which,
I guess the best
face you could put on
it
is that Fish and Wildlife
is putting a lot
of pressure on the Department of Defense. The worst face you can
put on
it is that Fish and Wildlife is blackmailing the Department
of Defense into taking a hard position on this particular item.
The Department of Defense
I know has been difficult historically
on Guam, but in recent years, at least on the issue of land, they
have certainly been more willing to be cooperative.
I think people should be willing to explore the process you have
outlined.
I do not discount
it.
I think people should be willing to
explore that process of coming up with a habitat conservation plan.
It
is just that there are three things that come to my mind. One
is that the Department of Defense's position has been compromised
not because of the issue of whether they want to return the land
or whether they need the military land anymore;
it
is that they
have been made to understand by Fish and Wildlife that their fu-
ture use of the land that they intend to hold for the foreseeable fu-
ture would be complicated by Fish and Wildlife regulations.
The second concern
is that we would go into a habitat conserva-
tion plan negotiation
in which Fish and Wildlife
will continue to
hold
all the cards,
in which we have to get Fish and Wildlife to
have confidence that the resulting plan would meet those things.
So the negotiation is such that Fish and Wildlife continues to hold
90 percent of the cards.
And the third item
is that even
if there were agreement on this
process, the part that
I think Mr. Faleomavaega was touching on
is an important one. At least the spirit of the proposed legislation
says that the Government of Guam should be at the head of the
line because of all the kinds of things that
all of us are familiar
with on this particular issue on land and the return of excess land,
that the Government of Guam should be at the head of the line in
front of all Federal agencies. And even on that,
I think the admin-
istration has not yet softened its position, and that
still remains a
source of concern.
But DoD's role in this has been a curious one and one that cer-
tainly through the land conference process which we instituted col-
laboratively with the Department of the Interior and which
I am
very grateful for and do not want these comments to be in any way
disparaging
of any
willingness
to
discuss
these
issues—I
think
there is serious willingness, and
I know that you personally would
like to see this issue behind us, and I appreciate that, and
I appre-
ciate the willingness for dialog and to continue to creatively craft
some solution
to this—but when the Department of Defense has
been
led
to believe that their existing holdings, not willing that
they are willing to excess,
is going to be compromised by Fish and
Wildlife, and as a result of that, they then start taking a different
position on the release of excess land,
I think there is room to say
that Fish and Wildlife has buffaloed DoD.
Mr. Faleomavaega.
I thank the gentleman from Guam for his
comments.
13
Without objection, for the sake of time,
I am going to submit my
opening statement to be made a part of the record, and Governor
Lutali's statement will also be made a part of the record.
[The
parpered
statement
of Hon.
Eni
F.H. Faleomavaega
fol-
lows:]
Statement of Hon. Eni F.H. Faleomavaega
Mr. Chairman, Thank you for holding a hearing this afternoon on several of the
technical issues now facing the U.S. territories.
I hope we are able to address these
issues during the remaining days of this Congress, and
I am optimistic that we can
reach consensus on most, if not all, of these provisions.
Among the issues under discussion today are some of those contained in a bill
I
introduced, H.R. 3721, a bill to estabhsh an Omnibus Territories Act. This legisla-
tion is an attempt to combine into one bill several of the less controversial legisla-
tive
initiatives which have been pending
or discussed during
this Congress, but
which have not been approved by the Subcommittee.
I will address the titles under
consideration by title number:
Title
I. Under current federal law, American Samoa, Guam, and the Virgin
Is-
lands are
all required to conduct elections for the delegates' positions by separate
ballot. There
is no legislative history on this issue which indicates a rationale for
this requirement, and
I have been unable to determine the continued need for this
provision.
In the absence of a substantive rationale
for the language, the Government of
Guam has requested that the requirement be deleted because
it costs the govern-
ment additional funds to print separate ballots for the delegate election. Deletion
of the requirement would enable the government of Guam to conduct its elections
in a more efficient manner, without jeopardizing the integrity of the elections. As
introduced, H.R. 3721 included the Virgin Islands in this title. Congressman Frazer
has requested that the Virgin Islands retain the requirement for a separate ballot.
It was not my intent to force this change on the Virgin Islands, and
I support delet-
ing the Virgin Islands from Title
I.
Title II. The territory of American Samoa is the only unorganized, unincorporated
territory
of the
United
States.
There
is
no
single document which
reflects
the
present unity of the running debate for decades over the intent of the Samoa chiefs
who signed the documents joining American Samoa and the United States into a
poUticm union. Whether the intent was to cede the land and people to the United
States, or to enter into a bilateral treaty, which would, at some point, be subject
to further negotiations, is not clear.
Title
II would establish a federal commission which would document and report
on exactly what took place 96 years ago when the Eastern part of the Samoa Island
groups became part of the United States, and what this bilateral relationship has
developed into since 1900. The Commission would also be directed to report on the
various status options available to American Samoa. The Commission would be com-
posed of five members, three of whom would be appointed by the Secretary of the
Interior, one by the Speaker of the U.S. House of Representatives, and one by the
President of the U.S. Senate.
I want to emphasize the unlike the sometimes contentious negotiations on poUti-
cal status in Guam and the always contentious discussions on
political status in
Puerto Rico, this proposal does not, and
I want to say this again, this legislation
does not establish a political status commission. The Commission will not have the
authority to change American Samoa's political status. The commission is modeled
after the Commissions which studied Native Hawaiian, Native American, and Na-
tive Alaskan
issues. These three commissions provided resource materials which
have been of significant benefit to these groups and to those who are interested in
the history of these issues.
The establishment of the American Samoa commission has been a topic of discus-
sion in American Samoa ever since
I first proposed
it several years ago. Some have
questioned the need
for a federal commission, indicating that there
is more than
sufficient talent in American Samoa to convene a commission of this nature. In re-
sponse, let me say that
I agree that there are many individuals in Samoa with the
knowledge and experience to make excellent members of the commission
I propose,
and I hope that some of there individuals will sit on the Commission. The key, how-
ever,
is having access to the resources of the federal government, such as the Li-
brary of Congress, and access to the records of the federal departments and agen-
cies, including the materials contained in the National Archives.
It is only through
a federal commission that we can ensure that these resources are made available.
14
Additionally, the commission will be federally funded, which
will enable the local
government to use
its limited financial resources to improve its capitail infrastruc-
ture and continue to provide basic services.
Finally with regard
to the proposed study commission,
I have suggested in the
Congressional findings, and propose to include in the duties, that the commission
study and evaluate the
historical
relationship of Swains Island and the Tokelau
group of Islands to American Samoa. Swains Island was added to American Samoa
in 1925 without consultation with the leaders in American Samoa, and
I believe
it
would be useful
to examine both how this occurred and any relationship between
Swains Island and the Tokelau group which may warrant further federal consider-
ation.
Title
III. American Samoa
is the one territory most in need of economic assist-
ance in developing the basic infrastructure necessary to promote successful economic
development.
It is dependent on an annual federal appropriation to assist with the
operations of its government and for improvement to
its infrastructure. Each year,
an appropriation is made pursuant to a 1929 statute providing for the government
of American Samoa. The American Samoa Government does not know from one year
to the next how much funding it will receive, and this uncertainty makes planning
of the Isirger construction projects more difficult and more expensive.
Title III of this legislation authorizes $10 million per year for six years for capital
improvement projects. Any appropriations made pursuant to this legislation would
be made in the regular appropriations process through the Department of the Inte-
rior.
The subcommittee has not asked
for testimony pertaining
to
Title IV or H.R.
3721, which would add Baker Island, Jarvis Island, and Rowland Island to Amer-
ican Samoa. Our Chairman proposed in early 1995 adding these islands, and others,
to the jurisdiction of the State of Hawaii. At that time, the Hawaii delegations were
either opposed to or silent on the proposal, and based on this hesitancy
I included
in H.R. 3721 language which would add the three southernmost islands
of this
group
to the
territory of American Samoa. These islands are closer
to American
Samoa than they are to any other U.S. land mass, and at their closest point they
are about 800 miles from Swains Island, the northern Island in American Samoa.
It was my intent to seek federal sanctuary status for these islands, similar to that
of Rose Atoll.
I was unaware when
I introduced this
title that Senator Akaka had introduced
legislation the day before to add these and other islands to the State of Hawaii.
After the
legislation was introduced. Congressman Abercrombie's
office expressed
some concern with this
title. Yesterday,
I spoke with Senator Akaka on this issue,
and he has informed me that his
efforts are
to provide a protective umbrella
for
these islands. A recent proposal to construct a nuclear waste faciUty on the island
on Palmyra prompted the Senator to provide this extra protection for the Pacific is-
lands, and
I want to commend him for his current effort. For these reasons,
I wish
to delete Title IV from further consideration by the Subcommittee,
Title rV. Under prior law and pursuant to a covenant reached between the Com-
monwealth of the Northern Mariana Islands (CNMI) and the United
States, the
CNMI was receiving $27.7 milUon per year to be used for the construction of capital
improvements in the Commonwealth. Earlier this year, we changed this law, and
f>ortions of that funding are now directed to insular areas with greater needs. The
anguage authorizing this funding prohibited the use of the funds to match other
federal grants. The reallocation was made in such a way that the non-matching re-
quirement is now appUcable to the other territories receiving the funding.
I am fa-
miUar with the difficulties this creates for American Samoa, and would like to share
this with the Members of the Subcommittee.
American Samoa has been hit by three hurricanes in the last decade, and as
is
the case with the states, with a presidential declaration of a state of disaster, disas-
ter assistance grants have been made available to the local government. Unfortu-
nately, Samoa's economy was so devastated by these hurricanes, and the financial
wherewithal of the local government
is so low, that the American Samoa Govern-
ment has been unable to take advantage of several of these grants because it could
not meet the local matching requirement. Title V will permit the American Samoa
Gk)vemment
to use
this source
of funds, already earmarked
for capital improve-
ments, to meet the matching requirement for grants for the construction of capital
assets.
Title VI. The people of Guam yielded much of their land
to the United States
dviring World War II. Now, as the federal government is contracting in size, parcels
of this land in Guam are being considered excess. Title VI would give the govern-
ment of Guam
first optiv^n to acquire this excess property as
it becomes available.
15
With regard to Title VII, the Subcommittee has already held a hearing on Section
701 of the legislation, and Sections 702 and 703 are more appropriately under the
jurisdiction of the Committee on Ways and Means. For these reasons, testimony was
not solicited on this title.
I will, however, say that I support all three of these provi-
sions.
Title VIII. The Virgin Islands
is another territory which
is struggling to make
itself self-sustaining. The elected representatives of the U.S. Virgin Islands believe
that a commission of experts could develop a plan which would enable the Virgin-
Islands to focus their efforts in the proper direction. This title would establish a six-
member Commission, appointed by the President. The Commission would make rec-
ommendations
to the President and Congress on the
policies and programs nec-
essary to provide for a secure and self-sustaining future for the Virgin Islands.
Thank you, Mr.. Chairman, for the opportunity to present this statement.
I look
forward to hearing from our witnesses.
[The statement of Governor A.P. Lutali may be found at end of
hearing.]
Mr. Faleomavaega.
I do have some questions, Mr. Stayman, and
I think
I
will pose those
for you in written form so that we can
move our hearing along this afternoon.
I want
to thank you
for
your comments and also for representing the administration at this
hearing.
Mr. Faleomavaega.
I would now
like to turn the time over to
the gentleman from Guam to introduce our next panel for the Jiear-
ing this afternoon.
^
Mr. Underwood. Thank you, Mr. Chairman.
It
is my honor and privilege
to introduce to the Subcommittee
the honorable Madeleine
Z. Bordallo, the Lieutenant Governor of
Guam, representing Carl Gutierrez, who is Governor of Guam.
In my interactions with Governor Bordallo in the past few days
on Guam, she was the acting Governor;
I do not know if she is the
acting Governor anymore, now that the other Governor
is back on
Guam. But we will let the Virgin Islands figure out all those prob-
lems with Governors and acting Governors and whatnot.
It is a privilege and an honor.
I have worked with the gentlelady
for many years, and it has always been a privilege; she has always
done an excellent job of representing the island and
its interests.
Mr. Faleomavaega.
I, too, would like to offer my personal wel-
come to Lieutenant Governor Bordallo for her presence this after-
noon, and certainly the Subcommittee looks forward to hearing her
testimony this afternoon.
Please.
STATEMENT OF HON. MADELEINE Z. BORDALLO, LIEUTENANT
GOVERNOR OF THE TERRITORY OF GUAM
Ms.
Bordallo.
Thank
you
very
much,
honorable
delegate
Faleomavaega and the members
of the Subcommittee on Native
American and Insular Affairs. Of course,
I would like to also wel-
come and say "Hafa adai" to Congressman Underwood. Mr. Chair-
man, we came in on the same flight today, and he looks so bright
and cheery, and my hours are all out of sync, so please bear with
me.
On
behalf
of
the
people
of Guam
and
Governor
Carl
T.C.
Gutierrez,
I extend a warm "Hafa adai" from the land where Amer-
ica's day begins.
In the same
spirit,
I thank you
for this oppor-
tunity to discuss issues of importance to our people that are con-
tained in H.R. 3721 and other matters of concern to this committee.
16
Your interest in matters of concern to us is indeed heartening, and
we stand ready to work with you to accomplish these goals.
As you are aware, the people of Guam since 1987 have outlined
their views on a host of matters that would address the structure
of our relationship with the United States, that will allow the peo-
ple of Guam, through a
Constitution,
to
establish their internal
self-governance. As we speak, Guam's Commission on Self-Deter-
mination
is in the middle of intense discussions with the adminis-
tration on mutually agreeable language which will be submitted to
Congress and which, with the blessings of Congress, will form the
foundation of a new and more equitable
political partnership be-
tween Guam and the United States.
However, Mr. Chairman,
I would
like
to focus on an
issue
of
enormous significance to Guam today, and that is the issue of land.
Guam's
total
land
area
is
small,
very
small,
just
210
square
miles—smaller than even the smallest State of the Union. Of this,
the Federal Government controls 70 square miles, or approximately
33 percent of the island's total land mass.
Mr. Chairman, even these numbers are deceiving because the 70
square
miles
encompass
the
most
usable
lands
and
the
best
stretches of beach and water frontage. In terms of economic devel-
opment, the Federal Government controls the best parcels.
Prior to the extensive land condemnations by the Naval Govern-
ment during and immediately after World War
II, most land was
privately held. After the War, our elders, out of gratitude and pa-
triotism and loyalty, never disputed the need for the Federal Gov-
ernment, especially the military, to use the land for national secu-
rity purposes.
However, fundamental fairness dictates that these lands should
be returned to Guam when they are no longer needed for national
security.
Mr. Chairman, Guam's growing population and our economic de-
velopment require that we, the people of Guam, be the first and the
final determiners of all forms of land use except that which can be
proven without dispute
is required for national security purposes.
H.R.
3721,
like the Senate's companion measure,
S.
1804,
cor-
rects several anomalies that occur when federally-held land has ei-
ther been returned or is about to be returned to Guam.
Please be assured that we support expedited processes of land re-
turn which make Guam's interests the priority in lands excessed
by the Defense Department. Guam's needs and the needs of its peo-
ple must
always
be
the
first
priority
for
the
return
of lands
excessed by DoD. The fact that they are being returned by DoD
is
proof that the properties are no longer required for national secu-
rity purposes.
Unfortunately and unfairly for the people of Guam, lands about
to be returned by the Department of Defense have been grabbed by
other Federal agencies. Recognizing the national security interests
of Guam and
the
unique
history
of the United
States owning
Guam,
lands not needed
for U.S.
national
security must be
re-
turned to the people of Guam, not put on the auction block for any
Federal interest's bid.
In 1991, the Department of Defense agreed to transfer about 300
acres of land located at Ritidian Point to Guam. At the last mo-
17
ment, Guam
learned
that
the
Fish
and
Wildhfe
Service
had
claimed the land.
The Fish and Wildlife Service turned the land into an unfunded
wildlife refuge for native birds that effectively have been driven to
extinction by the brown tree snake which thrives
in
this refuge.
While Fish and Wildlife conducts an expensive and only marginally
successful breeding program for some of these birds at Front Royal,
Virginia, they have no plan
to eliminate the predatory snake
in
Guam's jungles. Without an elimination of the brown tree snake,
all the breeding programs conducted in Virginia, California, Florida
or elsewhere are but exercises in futility.
Guam's lands were once taken for national defense, then again
taken for reasons that have never been fully explained to or under-
stood by the people of Guam—and I repeat, Mr. Chairman, we have
so little land. H.R. 3721, like S. 1804, would prevent another such
land grab and would help free previous land transfers from con-
straints on the use of returned lands.
A prime example is the return of 927 acres of reclaimed and sub-
merged lands in Apra Harbor to the Government of Guam. The de-
velopment of this property, which has no national security uses or
significance,
is burdened with the unreasonable
constraint more
properly referred to as the Brooks Amendment.
It is a Federal law
which mandates that any profits from the lease or sale of the prop-
erty must be given to the U.S. Government.
The Brooks Amendment has removed any incentive for the Port
of Guam
to spend
its own funds
to provide the necessary
infra-
structure and capital improvements to upgrade the existing facili-
ties.
Subsequently,
there has been no economic development on
that land.
Excess property, which had no national security significance to
the Department of Defense, but which holds tremendous economic
potential for the people of Guam, lies idle, Mr. Chairman, because
a Federal
statute mandates
that the
profits from
that property
must be given to the U.S. Treasury.
We would like this committee to consider a related issue—land
that
is to be transferred should
first be cleaned up. Early in the
life of our administration, hazardous waste was discovered on land
formerly held by the Department of Defense but which was turned
over to the Government of Guam as the site for our new Southern
High School. Work was halted to ensure workers' safety, and con-
struction delays cost us over $1 million. In addition to the cost of
delays, we also bore the cost of cleanup to ensure that costs result-
ing from the construction delays did not become unmanageable.
Mr. Chairman, the people of Guam have proven that they are
willing to work with the military or any other Federal agency, in-
cluding the Environmental Protection Agency,
to make sure that
cleanup
activities proceed as
efficiently and economically as pos-
sible for all parties. We want to put unused lands to productive use
for public and economic development purposes.
The expeditious transfer of federally-held lands
is necessary to
accomplish results that are meaningful to the people of Guam as
well as to the United States. We are confident that H.R. 3721 and
S. 1804 are steps in this direction. After exhaustive study, we be-
lieve that there are about 27,000 acres of federally-held property
18
that can be returned to Guam. Some of that
is covered by BRAG
decisions or H.R. 2144, making the passage of H.R. 3721 and
S.
1804 even more timely.
Our economy could be developed even more
if we had
control
over more of the prime property now held by the Federal Govern-
ment. The island's best beach properties are either landlocked by
or are part of exclusive-use military property. Of the property with-
in a 3-mile radius of Guam's deep water port, 65 percent
is feder-
ally-held.
At stake is not just the disposal of Federal assets, but the future
of our community.
The committee's call for this hearing also invited comment on a
Guam resolution requesting language to enable the creation of an
elected attorney general. Mr. Chairman, I would like to briefly com-
ment on that.
Our administration is of the opinion that the mechanism for such
already
exists, and that
is the result of the Omnibus Territories
Act of 1985 where Guam would
elect an independent prosecutor.
Guam's senators have not opted to exercise that mechanism, and
the opinion and the consensus of the people through public hear-
ings and other public forums, we feel should be ascertained before
any form of commitment or action is taken in this regard—in other
words, a referendum.
In conclusion,
I would like to personally invite you, Mr. Chair-
man, and members of this committee to come to Guam. It is impor-
tant to witness firsthamd the issues under your review here, and
it is important that you get to know us and our plight better, bear
witness to the impact of your work on our island, as together we
move forward in a partnership that fairly balances Guam's inter-
ests with the continuing Federal interest in national security.
In Chamorro, we express our gratitude with a sincere "Dangkolu
Na Si Yu'os Ma'ase." Thank you, Mr. Chairman,
for allowing me
to sj&ak to you about these important issues.
Mr. Faleomavaega. Thank you, Madam Governor,
The gentleman from Guam.
Mr. Underwood. Thank you very much, Governor, for your very
fine statement. Could you perhaps elaborate on some of the prob-
lems that the Government of Guam has had with the Federal lands
that have been turned over and some of the cleanup problems that
we have had?
Mr. BORDALLO. Well, delegate, as
I mentioned,
I think one of the
most exasperating was when we began to build our Southern High
School, and we found lands there that were not cleaned up. We had
to halt the construction, and
it cost our local government over $1
million, as
I mentioned in my testimony. This is one example.
Mr. Underwood. And
in terms of the overall process that has
been identified in terms of the land return process for the Govern-
ment of Guam goes to the head of the line in the return of Federal
excess lands, maybe you could explain to the committee, or at least
for the record, why Guam should be treated differently from other
areas of the United States.
Ms. BORDALLO. Getting back to the other question,
I do remem-
ber another area. This is the NES again, land that was recently re-
turned to us, BRAC '93.
19
First of all, Mr. Chairman, we are not in possession of that prop-
erty; we do not have a deed as yet to that property. We are simply
caretakers operating under licensed
facilities. We have not even
agreed on a lease as yet, but we are working on
it. But there are
26 areas at the Naval Air Station now known locally as Tejin that
are contaminated, and
I understand that
it
will take anywhere
from 8 to 10 years to clean up.
So these are some of the frustrating problems that we have in
acquiring Federal property.
Mr. Underwood. The question
I
had, Governor, was
that the
legislation that has been proposed by myself and the delegate from
American Samoa in his omnibus measure holds that the Govern-
ment of Guam should be treated differently than other areas under
the United States in terms of the return of Federal excess lands.
Perhaps you can elaborate on why this
is justifiable in comparison
to other areas of the United States.
Ms.
BORDALLO.
Well,
I
feel
certainly
as
you
do,
Delegate
Underwood, that the Government of Guam should be placed at the
top of the priority
list. One of the reasons
is that we just have so
little land, and the Federal Government has taken over all of the
choice areas on Guam including our beachfronts. So for this reason,
I think the Gk)vemment of Guam should be placed at the top of the
priority
list, and
if there
is any other habitat conservation plan
that is being thought of, I certainly am one to recognize that impor-
tance, but
I do not think that the minute Federal properties are
available, or they are thinking about turning it over to the Govern-
ment
of Guam,
that the
habitat conservation
plan
should come
first, and we should come second or third or whatever.
I feel that
because of the small area and how precious our lands are and that
our people—we have so many people who are crying for land, origi-
nal landowners—this should be considered, and
I think these prop-
erties should be turned over to the Government of Guam as a top
priority.
Mr. Underwood. And just for the record,
I wanted to clarify on
the Brooks Amendment
legislation. We have that
in a
different
piece of legislation that has already made
it through the Depart-
ment
of Defense
authorization
process,
so
hopefully
it becomes
fixed that way.
I think that at least that
is one thing that almost
everybody agrees on, and now that Mr. Brooks is gone—thank you.
Ms. Bordallo. And Congressman,
I would mention
that
this
halts our progress. We are so anxious to begin our economic plans
for Guam, and with the Brooks Amendment, it just puts everything
on hold.
Mr. Underwood. Thank you very much.
Mr. Faleomavaega. Madam Governor,
is
it my understanding
that there are still 22,000 acres that the DoD was willing to trans-
fer to the Government of Guam, but because of the interjection of
the Fish and Wildlife Service and in concurrence with the Depart-
ment of the Interior, these 22,000 acres are now at bay—I mean,
there is nothing being done to make this transfer possible?
Ms. Bordallo. That is correct.
Mr. Faleomavaega. Do you believe that the provisions of the bill
as proposed for this transfer will remedy that difficulty or the prob-
lems that we currently have?
20
Ms. BORDALLO. Yes, I do.
Mr. Faleomavaega.
I have always wondered if our friends in the
Department of the Interior are advocates for the Territories, or
if
they are enemies.
I am somewhat puzzled by
all this, seeing that
as the primary agency that has responsibility for the Territories,
at least a better understanding of Fish and Wildlife Service and
the history of how the lands in Guam were literally just taken over
by the military
after the World War, without due compensation
and without really even giving the people of Guam the opportunity
to reclaim their lands.
I happen to have an understanding of that, and I am really puz-
zled by why our friends from the Department of the Interior are
not advocating for the needs of the Government of Guam, especially
in this pending legislation.
Madam Governor,
I want to personally welcome you again and
to thank you for taking the long trip here to Washington to testify
before the Subcommittee. Some of the fondest memories that I have
are of the time that you were there with Governor Bordallo and the
hospitality and kindness that was afforded me, and the times that
I visited the beautiful Island of Guam,
I will never forget. And
I
want to thank you, and
I sincerely hope that perhaps in some due
time, the committee will have an opportunity to visit Guam again
and to hopefully flesh out some of these issues, and that we can
find remedies and
solutions and not continue
to have problems
with them.
So again. Madam Governor, thank you for your testimony.
Ms. Bordallo. Thank you, Mr. Chairman.
In closing,
I would like to add one point, and perhaps the dele-
gate
is not aware of this, but recently,
I visited several of our golf
courses when we had a tournament of champions to raise money
for beautification on Guam, and some of the managers of our golf
courses told us that they have so many birds in the golf courses.
So perhaps the Department of the Interior people may want to go
out and look at this.
I cannot think of a better refuge for birds than
our beautiful golf courses, so
I am just suggesting that perhaps a
visit to Guam will enlighten some of our Department of the Interior
officials.
Mr. Faleomavaega. Well taken. Thank you very much. Madam
Governor.
Ms. Bordallo. Thank you, Mr. Chairman.
Mr. Faleomavaega. For our next panel, we have the honorable
Elizabeth Barrett-Anderson of the Guam Legislature, and the hon-
orable Hope Cristobal, also a member of the Guam Legislature.
I certainly would like to give this opportunity to our good friend,
the gentleman from Guam,
for any introductory remarks he may
have.
Mr. Underwood. Thank you again, Mr. Chairman.
It is my honor and privilege to present to the committee Senators
Hope Cristobal and Elizabeth Barrett-Anderson. As can be clearly
seen by the presentations today, male elected
officials are an en-
dangered
species on Guam, and females continue
to make great
strides in the political environment of Guam and certainly, as we
heard
the
testimony
of the
Governor,
it was remarkably
fresh,
21
given the fact that she just came off a flight that I know took some
24 hours.
I would certainly like to welcome and extend my sincerest "Hafa
adai" to my two colleagues from Guam.
I know the committee will
be attentive to their testimony.
Thank you.
Mr. Faleomavaega. If the gentleman would yield,
I will also say
that they are better-looking than the men of Guam. Please proceed.
STATEMENT OF HON. ELIZABETH BARRETT-ANDERSON,
SENATOR, GUAM LEGISLATURE
Ms. Barrett-Anderson. Thank you very much, Mr. Chairman,
and "Hafa adai" from Guam.
Robert,
it
is good to see you
all.
I
came a day
earlier
to be a
bit more
refreshed. You are
truly a
Chamorro gentleman. You remarks were right on par for Guam.
I have written testimony, Mr. Chairman, that
I would like
if it
is appropriate to move to be accepted.
I will not read from my writ-
ten testimony but will speak directly to the committee.
Mr. Faleomavaega. Without objection,
it will be made part of
the record.
[The prepared statement of Ms. Barrett-Anderson may be found
at end of hearing.]
Ms.
Barrett-Anderson.
Resolution
433 was
adopted
by
the
Guam Legislature
last month, unanimously voted
on,
to request
this committee and
this Congress
to amend the Organic Act
to
allow for an elected attorney general, specifically.
The resolution seeks to change two major portions of the Organic
Act dealing with the executive branch, and
I will deal with those
very briefly.
It will provide that the executive branch will now have a third
coequal position, and that position would be the attorney general.
The Organic Act of Guam provides for the Governor and Lieuten-
ant Governor in the executive branch. This resolution would now
allow a third coequal position to be the attorney general.
I believe that it is important to establish this as an organic posi-
tion or, more generally called a constitutional position, because cur-
rently the attorney general position on Guam
is a statutorily-en-
acted local position, meaning that
it
is established by the laws of
the Territory. The Attorney General of Guam
is a directorship.
It
is a line agency head. It is not a constitutional position.
The danger in not doing this, and
if the Territory were to have
an elected attorney general without this amendment, would be that
any challenge would clearly hold that that local statute would be
inorganic; it would not withstand any constitutional challenge.
The Governor has complete, absolute and plenary authority over
the entire executive branch of the Government of Guam. Let me
give you an example to highlight this. Several years ago in
1986,
this body authorized the Territory to establish an educational sys-
tem in the Territory of Guam. In
1993, the Guam Legislature en-
acted
the
elected
board
of education.
This
administration,
soon
after coming into
office, took a court challenge, and that decision
is
still pending before the
trial
court
in the Territory of Guam,
challenging the organic-ness of the elected board of education.
22
I believe the Governor is correct; I believe the Governor is correct
in that the elected board of education is inorganic, because nothing
can impinge on the Governor's organic authority to control the ex-
ecutive branch in total, and that includes education.
So that providing that the attorney general is now a coequal po-
sition
in the executive branch will prevent future litigation as to
the elected attorney general.
Secondly, and
I think perhaps the one item that most members
of this Congress might be a
bit uncomfortable with,
is that the
Guam Legislature has asked this Congress to specifically state that
the attorney general will be elected. Generally, Congress provides
that a territory or a jurisdiction
is authorized to determine under
local law whether it is appointed or elected.
This amendment was
placed on
the
floor during
debate. The
original measure did not have that. In debate, it was discussed that
there should be no question that what the Territory wants
is an
elected attorney general.
If
it
is
left that the Territory of Guam
may decide how
it wants to select
it, then obviously we can decide
to maintain it as an appointed position or an elected position.
I believe that Congress providing that
it shall be elected
is con-
sistent with Congress' plenary authority over the
territories and
would be consistent with Congress' intent that Guam be self-gov-
erning.
Mr. Chairman,
I was attorney general for IV2 years, and
I can
tell you that the most important aspect of this resolution
is that
it
is another example of self-government for the Territory. Let me
express four situations where this Congress has provided self-gov-
ernment to the Territory.
First, in 1968, with the elected Governor of Guam; second, in the
mid-1970's, with the authorization of the Territory to go forth and
create a Constitution.
It has been 20 years, and we have not done
it, but we
still have the authority to establish a Constitution for
the Territory.
Third,
in
1983, when the
restriction
prohibiting the
establish-
ment of a municipal government was deleted from the Organic Act.
Guam can today create municipal government. We do not have mu-
nicipal government.
And then, fourth, in 1986, when this Congress gave the Territory
the power to establish the Supreme Court of Guam. Unfortunately,
we have a Supreme Court, but we do not have a Constitution for
them to interpret.
And the fifth one was when this Congress allowed Guam to es-
tablish its own tax code.
Those are five clear examples of self-government. This Congress
has been overly generous to the Territory in saying to Guam,
"If
you want to be self-governing, here are some of the tools to do
it:"
We are asking for the sixth example, that this Congress allow
the Territory to have an elected attorney general as a clear and
convincing and unequivocal statement of self-government
for the
Territory.
Thank you, Mr. Chairman.
Mr. Faleomavaega. Thank you.
[The
prepared
statement
of Hon.
Elizabeth
Barrett-Anderson,
Delegate from Guam may be found at the end of the hearing.]
23
Senator Cristobal?
STATEMENT OF HON. HOPE CRISTOBAL, SENATOR, GUAM
LEGISLATURE
Ms. Cristobal. Thank you, honorable Chairman. Buenos
dias
and Hafa adai from the people of Guam.
Honorable Chairman and members of the committee, my name
is Hope Alvarez Cristobal, and
I am the chairperson of the Com-
mittee on Federal and Foreign Affairs in the Government of Guam
Legislature, of which my colleague, Senator Barrett-Anderson,
is a
member.
On behalf of the people of Guam,
I offer this testimony in sup-
port of the Omnibus Territories Act, H.R. 3721, Title VI, the Guam
Land Return Act. Referencing the three sections, 601 is the name
of the Act; 602 basically seeks to amend the Organic Act of Guam
to add a new
title, section X, to require the administrator of the
General Services agency to notify the Government of Guam that
property
is
available. Notice
is
to occur at
least
180 days before
transferring excess real property located in Guam to any Federal
agency;
(b) the administrator shall transfer to the Government of
Guam
all
right,
title and
interest of the U.S.
in the excess
real
property
located
in Guam by quitclaim deed and without
reim-
bursement
if Government
of Guam
does
express
interest
in the
availability of such Federal
lands; and
(c) the term "excess
real
property" means excess property as that defined under section 3 of
the Federal Property and Administrative Services Act of 1949 as in
effect on the date of enactment of the Guam Land Return Act that
is real property.
Section 603 amends section 818(b) of Public Law 96-418 relating
to a condition on disposal by Guam of lands conveyed to Guam by
the U.S.
Although we fully recognize the rationale for a general policy al-
lowing Federal agencies to be a priority consideration as a recipient
in
acquiring any
excess
Federal
lands, we
support
a
different
prioritization
policy
for Guam
given
the
fact
that
insular
land-
holdings in this area are rather small and limited. Limited land re-
sources
in Guam have prevented
the Government from moving
ahead with any meaningful
or ambitious economic
revitalization
program.
Much of the Guam lands acquired by the Federal Government in-
volve
the
acquisition
of
private
property
through
seizures
or
through condemnation processes which denied people a measure of
full due process rights, especially in the cases of private property
acquisition.
To our Chamorro people, the indigenous people
of Guam, land
tenure
is viewed as inseparable to their existence and well-being.
As an example,
if I were to harvest crops from my mother's land,
my whole
relationship with family members and
villagers comes
into
play. Harvesting and sharing crops
is a way of establishing
stature and strengthening ties among family members and the vil-
lage community.
We hold with high honor and respect one who shares food coming
from the land. Ownership of land
is not just as a commodity but
as inheritance to be passed on down through the generations. Even
24
today, our people continue to believe that they will someday obtain
their other lands back from the Federal Government. In the eyes
of the Chamorro people, the lands were only to be utilized by the
Federal Government and not owned, just
like they had practiced
for centuries.
It
is
also important that the unique situation
of the people of
Guam, living on a fragile and limited land mass and environment,
continues to be recognized. Furthermore, GSA policies which give
higher prioritization to other Federal agencies in the use of Federal
excess lands are incongruent to a developing people who have expe-
rienced
the
unjust
taking
of
their
lands.
Because
of
the
cir-
cumstances of the land takings after the war and the people's lack
of resources
then,
it
is
only
proper
that
the
people
of Guam,
through the Government of Guam, be given priority in terms of ac-
cess to these lands.
The people of Guam felt betrayed after they discovered that the
Department
of Interior's Fish and
Wildlife had obtained the
so-
called wildlife refuge at Litekyan.
It was beyond anyone's imagina-
tion that Tun Benigno Flores, a landowner, as well as other land-
owners
at
Ritidian,
would
never
return
to
his
childhood
play-
ground, family fishing hold, family land, and most of all, the legacy
of his ancestors.
I implore Congress to place in check the Department of Interior's
creative and
innovative predation
of Guam lands
for parks and
wildlife preservation and conservation.
As a point of information, Mr. Chairman, under the Organic Act
of Guam, the legislature
is given a distinct role in the disposition
of lands.
I ask, then, that under this proposed measure, the Guam
Legislature's role be protected and enhanced.
Congressman,
I fully support the proposed amendments by Con-
gressman
Underwood
under
Congressman
Faleomavaega's
pro-
posed Omnibus Territories Act, H.R. 3721.
Si Yu'os ma'ase, and
I thank you for your support and for your
invitation to testify on this very important legislation.
Mr. Chairman,
I would also like to at this point submit the testi-
mony of one of my colleagues of the Guam Legislature with respect
to
the
elected
attorney
general
position. My
colleague.
Senator
Vincente Pangelinan, had put together testimony. He is the author
of a
bill, 571, which
is ready to go on the floor of the legislature,
Ms. Barrett-Anderson. Mr. Chairman and Senator Cristobal,
that
is with the exhibits that
I turned
in with my written
testi-
mony.
Mr. Faleomavaega. Without
objection, the statements
of both
Senators will be made part of the record and any other materials
that you wish to submit will be made part of the record.
[The prepared statement of Vicente C. Pangelinan, Delegate from
Guam, may be found at end of hearing.]
Ms. Barrett-Anderson. Mr. Chairman, may I also say that I do
support H.R. 3721.
I think it is very creative, and
it is going to go
a long way to help the Territory of Guam.
I enjoyed the questions
that came from the panel here, and
I hope that this full Congress
passes it favorably.
25
Mr. Faleomavaega.
I thank both senators
for their fine
testi-
mony, and
I would like to turn the time now to the gentleman firom
Guam for questions.
Mr. Underwood. Thank you, Mr. Chairman, and thank you both
for your eloquent testimony on the issue of land.
I guess we have discussed land enough, but we will continue to
discuss it inevitably, even in other fora, I am sure.
I just want to ask a couple of questions on the proposed elected
attorney general and the resolution. Senator Barrett-Anderson, you
indicated that you were attorney general under the Ada adminis-
tration. What do you think Governor Ada would think of this pro-
posal?
Ms. Barrett-Anderson. Oh,
I do not think there
is a Governor
on this globe who would support taking away that privilege of ap-
pointing the highest legal officer. As an appointed attorney general
and a successful, hopefully, appointed attorney general,
it is ironic
that
I would be the
strongest proponent
for an
elected
position.
There were situations where it was very difficult in my position.
What would Governor Ada's position be? Knowing Joe Ada, a lot
of times, Mr. Underwood, he did not quite understand the role of
the attorney general, and maybe that
is why we worked out just
fine. He certainly let me do my job as best
I could, and other than
the abortion issue which
is stated in my testimony, that probably
was the most difficult of times in our relationship.
Mr. Underwood.
I
found
it
very
curious
in
your
review
of
Guam's move toward more internal self-government where you de-
scribed various steps that have been taken along the way, and then
in your presentation, you indicated that in the Guam Legislature
there was
discussion as
to whether
this would be permissive or
whether what you are proposing would require an elected attorney
general, and then you said that by requiring
it,
it would actually
promote more self-government. Isn't there an inconsistency in say-
ing that if I allow you to do something, and you decide whether or
not to do it yourself, that that is in fact more self-government than
saying to you, "I hereby mandate that you must do this"?
Ms. Barrett-Anderson. Well, Congressman Underwood,
I think
the end product
is certainly self-government.
I know what you are
talking about, and as
I said earlier, the original draft as I had pre-
pared
it put
it in terms of this Congress providing the authority
and letting the Territory then decide which way it goes.
In response
to your question, the Territory through
its elected
senators have made a self-government statement through this reso-
lution.
It
will make a second self-government statement through
bill 571
that has
received
I think unanimous
support from
the
Committee on Judiciary to get
it onto the floor of the legislature
perhaps by the August or September session.
So in that respect, I think we have made a self-government state-
ment.
Mr. Underwood. What is in bill 571?
Ms. Barrett-Anderson. Bill 571
is actually a companion to the
resolution.
If this
resolution were adopted by
this Congress, the
Territory would then enact the statute that specifically states the
manner in which an elected attorney general
is
selected. So they
are companion measures. One is the
bill, the statutory enactment.
26
And the question would be,
if Congress were to pass this and the
bill were enacted, would the Governor sign
it. Well, that is a ques-
tion. He would be subject to either override or sustaining the veto.
If 571 were
to be adopted in August session,
it would have to
have a provision that that bill is subject to congressional authoriza-
tion as outlined, perhaps, if it is acceptable, in Resolution 433.
Mr. Underwood. The Government of Guam currently has the
authority to elect a prosecutor.
Ms. Barrett-Anderson. No. That is incorrect.
Mr. Underwood. That is incorrect?
Ms. Barrett-Anderson. That
is incorrect. The provision in the
Organic Act does not state that, Mr. Congressman, and
I will read
it.
It allows the Territory to establish an Office of Territorial Pros-
ecutor. To me, that means
it can establish an
office. In my legal
mind,
it does not give the Government of Guam, the
legislature,
the authority to establish an elected prosecutor.
I give you the ex-
ample of the Territorial board of education.
It
is being challenged
right now.
I believe the Governor's challenge
is valid.
If tomorrow
the legislature passes an elected Territorial prosecutor, I think that
that will likewise be challenged similar to the elected board.
You must have a change in the executive structure of the Gov-
ernor. The Governor's power
is complete and absolute
in relation
to his control over the executive branch of Government.
Please understand
also that
I would not
favor, having been a
former attorney general, bifurcating the criminal division of the at-
torney general's office and elevating that to an elected position.
It
is a small enough island,
it
is a small enough department of law
that
I believe the elected position should not be the chief prosecu-
tor; it should be the attorney general of Guam.
If the Territory wants
to establish a
district attorney
position,
which
is the Territorial prosecutor,
I can understand that, but
it
cannot today be an elected position without congressional author-
ity.
Mr. Underwood. So your interpretation of the existing Organic
Act does not give the Government of Guam the right to authorize
an election for a prosecutor?
Ms. Barrett-Anderson.
I do not think
it would
in the same
manner that the provision that says the Government of Guam can
establish an educational structure likewise does not say it can have
an elected board of education.
Mr. Congressman,
right now, that decision with regard to the
elected board
is winding its way through—it
is actually under re-
view by Judge Gatewood. We do not know exactly how she is going
to turn out on that. She might surprise all of us and say the elected
board is organic.
I think that is very unlikely, because
it is a hard
struggle with that decision.
Mr. Underwood. Are there other offices that you think should
be elected?
Ms. Barrett-Anderson. There are traditionally three positions
in most jurisdictions that are elected in the executive branch, Con-
gressman, and those are the Governor, the Lieutenant Governor
and the attorney general. Other States do have,
I think, secretaries
of State. We do not.
I do not advocate the director of revenue and
'
27
taxation being elected. Maybe if I were director of revenue and tax-
ation for 7 years, I might be here, advocating that election.
Historically, the problems that we have had and struggled with,
the relationship between the Governor and the highest legal office
of the attorney general, will plague successors of the current attor-
ney general. It plagued my predecessors, it plagued me, it is plagu-
ing the current attorney general, and
it will always be that situa-
tion.
I believe that the balance in the executive branch between the
role
of the Governor and
the Lieutenant Governor
will be very
healthy and good for the Territory.
Mr. Underwood. Well,
I certainly appreciate your testimony and
the energy that you have devoted to this particular issue.
I think
it
is a concern that
is valid
in that
it raises a number of issues
about how to frame a government, how to structure a government.
I think that normally, we think of those as kind of constitutional
changes which should be done through local means.
I
still find
it
somewhat disconnected to argue that this
is a good blow for
self-
government. Indeed
it could conceivably be argued that this would
be a good blow for good government on Guam.
I appreciate my un-
derstanding from members of the committee that they are awaiting
a consensus position on this particular issue, and to that extent,
I
have asked beyond the confines of this committee hearing for for-
mal input from the Governor as well as members of the Judicial
Council on Guam to see whether a consensus position can be ar-
rived at on whether or not to proceed with this particular sugges-
tion or perhaps to suggest an alternative as to how they might best
implement.
Thank you very much.
Mr. Faleomavaega.
I was going to ask Senator Barrett-Ander-
son—was it Resolution 453 you indicated earlier?
Ms. Barrett-Anderson. Resolution 433.
Mr. Faleomavaega. Does
it have the endorsement of the Gov-
ernor?
Ms. Barrett-Anderson. No, Mr. Chairman. This
is
strictly a
legislative
resolution.
It does not go
to the Governor.
If bill 571
were to be adopted next month, then
it would be subject the Gov-
ernor's veto or passage.
Mr. Faleomavaega. You know, as a matter of observation,
it
is
kind of a mixed bag. In various jurisdictions among the States and
even in the Territories, the question is always raised as to whether
the Governor and the Lieutenant Governor should go on a joint
ticket or should run separately. The proposal as endorsed by the
Guam Legislature about electing an attorney general
also
raises
some
interesting questions. There
is the possible scenario where
the Governor might be a Democrat and the elected attorney gen-
eral is a Republican.
You indicated earlier that now, as an elected officer, the attorney
general will be coequal in this executive scenario, and
I wonder if
you might be asking for more problems than solutions to the prob-
lems.
In
its ideal form as
I understand
it, the reason for electing an
attorney general would be to provide more independence, especially
as
it relates
to criminal prosecutions,
civil lawsuits and the
like.
28
But at the same time,
it could be just as well reversed in terms
of being political; then it becomes a political situation more so than
resolving the problems. And
I am not saying that Guam is any dif-
ferent. Some States have this kind of situation and others do not.
What you
are
suggesting
here
is
that
the Guam
Legislature
strongly feels that the attorney general should be elected. Is
it for
purposes of suggesting that the attorney general then become an
independent prosecutor and not get involved in politics?
Ms.
Barrett-Anderson.
Because
the
attorney
general's
office
handles both
civil and criminal prosecution,
it would necessarily
mean that the attorney general elected would have full control over
criminal prosecution. It would not be called a territorial prosecutor
or a D.A., but it would be under that.
Mr. Faleomavaega. But you do not feel that the attorney gen-
eral could also be pla3dng politics because as an elected officer, he
could also be selective in his prosecutions.
Ms. Barrett-Anderson. You know, there are two sides of that
issue, and I have been asked whether electing the attorney general
will take politics out of it, and
I have said absolutely not.
I do not
think that position can ever be out of politics.
However, because of the complete and absolute position of the
Governor of Guam currently over the entire executive branch,
all
line
agencies,
including the Department
of Law,
both
civil and
criminal prosecutions,
I believe that
it would be healthy for the
Territory to have a bifurcation of the control of the Governor over
that office. And
I cannot tell you what the problems will be there,
but
I can
tell you what the problems have been—have been—and
that is why this Guam Legislature so unanimously opted to extend
the resolution to this Congress, because we know what the prob-
lems have been, and it must change.
Mr. Faleomavaega. If there are problems of abuse or the situa-
tion where the attorney general does not follow the law, doesn't the
legislature have the power of subpoena to have the attorney gen-
eral be subjected to public scrutiny on the part of the members of
the legislature?
Ms. Barrett-Anderson. That
is currently going on right now,
Mr. Chairman, and
I think that that
is a poor use of legislative
power and legislative time.
I have not participated in those hear-
ings.
I believe what
is going on right now
is probably a manage-
ment problem with the current attorney general, that he will sur-
vive. It took me 2 years, and I went through the same type of hear-
ings.
I do not think you can legislate management.
If there are true
problems in the attorney general's office, those should be addressed
by the legislature, but the problems that
I am talking about have
nothing to do with an oversight investigative-type hearing, subpoe-
nas called.
I am talking about the very structure within the execu-
tive branch of the relationships between the Governor and the at-
torney general and the Lieutenant Governor—primarily Governor
and attorney general.
Mr. Faleomavaega.
I suppose in the same analogy that we find
ourselves at the national level of our Government, where the Attor-
ney General
is nominated by the President subject to Senate con-
firmation,
it does not take away the political situation where the
29
Attorney General is criticized publicly by the Members of Congress
and even at times when she has to come before the Congress and
justify herself in some of the
decisions she has
to make
or has
made that may not necessarily agree or disagree with Members
both on the Senate and the House side.
The only point I am trying to make is that it could go both ways,
whether you elect an attorney general, or even the current process
where the attorney general
is nominated, and
I assume that this
is how the process is right now in Guam, subject to legislative con-
firmation—is this how your attorney general is
Ms. Barrett-Anderson. There is not a nomination process, Mr.
Chairman. It is purely an appointment at the discretion of the Gov-
ernor, confirmed by the legislature.
Mr. Faleomavaega. Oh, I see, so the attorney general is not sub-
ject to legislative confirmation?
Ms. Barrett-Anderson. The confirmation process, yes, but the
nomination process
is purely at the discretion of the Governor; he
selects any candidate.
Mr. Faleomavaega. But still subject to confirmation by the legis-
lature.
Ms. Barrett-Anderson. Yes, sir.
Mr. Faleomavaega. OK.
It is very ironic that Guam is an orga-
nized and unincorporated territory subject to
Ms. Barrett-Anderson. Unorganized, Mr. Chair; we are unor-
ganized.
Mr. Faleomavaega. No; you are organized.
Ms. Barrett-Anderson. I'm sorry.
I guess maybe
I am wishing
we were unorganized, but we are organized.
Mr. Faleomavaega. You have been organized since 1950 as I re-
call.
Ms. Barrett-Anderson. Yes. I stand corrected.
Mr. Faleomavaega. American Samoa
is both unorganized and
unincorporated, and yet we have a Constitution.
Ms. Barrett-Anderson.
I have often desired to have the same
kind of status as American Samoa, and your control and self-gov-
ernment of your island.
Mr. Faleomavaega.
I do not know about that; every time I have
my friend, Mr. Stayman, testify before this committee,
I keep feel-
ing that we are being subjected to "big brother" here.
The question
I wanted to ask Senator Cristobal
is about the ex-
cess land. Let me put this scenario, and maybe Mr. Stayman will
want to comment on this,
too. Why not allow by law the transfer
of excessive lands to Guam first and then let Guam deal with the
Fish and Wildlife agency, but give at least the property rights to
the Government of Guam, and the Fish and Wildlife Service can
then come to the Government of Guam and say OK,
let us work
something out. But at least give the deed to the lands to the Gov-
ernment of Guam and its possession.
What do you think of that possible scenario?
Ms. Cristobal.
I strongly support that approach, Mr. Chairman.
It has been discussed, apparently, in this Congress before that the
Fish and Wildlife Service owns the land as well as protects the spe-
cies that are on that piece of property. So yes, you are perfectly cor-
rect.
27-245 0-96-2
30
Mr. Faleomavaega.
I am going to suggest this to my good friend
from Guam as a possible option.
Another question—and I am sorry that our friend from Fish and
WildUfe is not here—^they are so concerned about the birds and the
bees, and
I can understand that. Have they been successfully con-
trolling the brown snake? Aren't we just as much concerned about
the livelihood of the brown snake, too, since it is part of the habitat
now?
Ms. Cristobal.
I understand that once we control the brown tree
snake, those heartaches will go away. But there are a lot of heart-
aches that have to do with the lands, and those people are slowly
dying, and they are not seeing their lands come back.
With respect to the snake, Mr. Faleomavaega,
I think everybody
is fully aware of it. I just arrived from New York this morning, and
if I may, Mr. Chairman, I would also like to add as a point of infor-
mation
that
I
attended
the
United
Nations
Committee
on
Decolonization's plenary meetings on Monday, and two paragraphs
of the report pertain to land. Ajid
if I may,
it
is just 6 lines long,
and it says: "Noting that the people of the territory have called for
reform in the program of the administering power with respect to
the thorough, unconditional and expeditious transfer of land prop-
erty to the people of Guam," and one of the operative clauses says,
"Also request the administering power in cooperation with the ter-
ritorial government to continue the transfer of land to the people
of the territory and to take the necessary steps to safeguard their
property rights." So
I just thought
I would add that as a point of
information that
in the international arena, land rights are
also
being discussed and the return of those lands, the Federal excess
lands, to the people.
Mr. Faleomavaega. Without
objection, we
will be more than
happy
to include the
rest of the statement or the document you
have submitted as part of the record.
Ms. Cristobal. I appreciate that. Thank you, Mr. Chairman.
Mr.
Faleomavaega.
Senator
Barrett-Anderson,
do
you
agree
with
the
Lieutenant
Governor's
statement
that
a
referendum
should be held by the people of Guam
first on
this issue of the
elected attorney general before Congress enacts a change in the Or-
ganic Act?
Ms.
Barrett-Anderson.
Mr.
Chairman,
I am
generally
very
much an advocate of the initiative process, referendum process, as
the
repeal
of existing
statute.
I support
initiatives generally
for
many, many issues in the Territory of Guam.
I would not oppose an initiative on this one. However, the unani-
mous position of my colleagues in the 23rd Guam Legislature, who
are
elected
at-large
in the Territory of Guam, having expressed
their representative view that an elected attorney general
is what
the territory needs, I would say would not require or necessitate an
initiative.
If, however, an initiative were to be required,
I would fully sup-
port that.
Mr. Faleomavaega. And I am sure you will also agree that there
is a coequal branch of the government on behalf of the executive
branch or the administration, that
it also has the privilege of ex-
pressing its support or maybe even opposition. But
I want to note
31
this assuming that this is on behalf of Guam's administration that
perhaps a referendum should be held
first,
before brmging
this
issue to the Congress.
u
i
^
Ms Barrett-Anderson.
I can tell you that were
I to go back to
my colleagues in the 23rd Guam Legislature and request that we
put this out to the electorate in the November election,
I am sure
that my colleagues—and
I cannot speak for Senator Cristobal—but
my hunch would be that my colleagues would say we have spoken
in two manners, the resolution to Congress and this piece of legis-
lation which is the bill that we are in full support
of. So that I do
not think the legislature would say that we will put a legislative
submission on the November ballot.
The only way,
therefore, that an
initiative can get
forth,
or a
plebescite, would be perhaps the executive branch
to organize
it
and conduct it.
...
^i
•
u
Mr.
Faleomavaega.
All
right. The
committee Chairman
has
some questions he would
like
to submit to Mr. Stayman's
office,
and I will have some questions also.
Mr. Faleomavaega. The gentleman from the Virgin Islands.
Mr. Frazer.
I was just listening very curiously because we tend
to have had the same problems as relates to the attorney general.
I would just like to ask Senator Anderson, did you find during your
7-year tenure that there were occasions where you
felt that your
independence was somewhat compromised because you had been
nominated rather than elected, and is that one of the bases for this
Ms. Barrett-Anderson. Yes. My answer would be yes. And the
clearest example in my written testimony
is the enactment by the
Governor of Guam of an anti-abortion law that was directly viola-
tive of the Roe case, and above my advice to the Governor and an
official opinion that was issued that the
bill that was pending be-
fore
the Guam
Legislature was
unconstitutional
as
passed,
the
Governor of Guam did sign the bill into law.
Mr. Frazer. Currently, we have in the Virgin Islands a situation
whereby the attorney general
is appointed, and
I have found that
in past administrations, there has been lack of understanding on
behalf of Governors, who thought that the attorneys general were
their personal counsel as opposed to someone appointed to be inde-
pendent
in an agency where you would expect that sort of inde-
pendence.
Do you believe that the majority of the people m Guam support
the proposition that this position should be elected as opposed to
appointed?
Ms. Barrett-Anderson.
I have no significant data to show that.
What
I would testify to
is my guess and my hunch, and
I believe
my guess would be that most of the people in Guam are eager to
elect their own attorney general.
We have a good selection of graduates and local attorneys who
have come back to Guam, having been educated here on the main-
land, and
I believe that were that position to be elected, we would
have some very good local candidates.
In my written packet are some
articles from the
Pacific Daily
News, which
is our only general newspaper of circulation, and of
the six people on the street who were asked about
it,
I believe four
32
of them said that, yes, we should have an elected attorney general.
If that is a straw poll or an example,
I believe that we would have
a good majority of the people of Guam saying they do want to elect
their attorney general.
There is a great amount of respect on the island for that position.
Mr. Frazer. Mr. Chairman,
I have just one further observation.
It seems to me that, being from a territory also, at times, we find
the Federal Government very heavy-handed
in what they believe
is in the better interest of the territories, such as this brown snake.
We have had the same situation at home.
I have yet to see the real
value of this brown snake as opposed to people's right to use land.
No one has convinced me that this snake serves any real purpose.
Now,
I am sure the conservationists are going
to attack me
for
that, but they will do that if they so desire.
We have the same situation at home, and as the Congressman
was suggesting, perhaps Guam and the territories would be in a
better position if they first got title, then deal with Fish and Wild-
life,
as opposed
to having Fish and
Wildlife impose these crazy
propositions, such as protecting some snake, making
it impossible
for people to properly use the land.
Do you find that there
is at times a heavy-handed approach by
the Federal Government in such things as protection of snakes?
Ms. Barrett-Anderson. Historically, since our organized struc-
ture in the territory, the Federal Government has taken a heavy
hand with regard to the Territory of Guam, as it has with all insu-
lar territories; there is no doubt.
Mr. Frazer. Has Fish and
Wildlife
said what
real value
this
snake possesses?
Ms. Barrett-Anderson. Well,
sir, what they are doing is creat-
ing the reserve not for the snake, but for the endangered species,
the birds up there. Unfortunately, at the same time that they are
preserving the
birds,
they are preserving the brown
tree snake,
which is the greatest predator to the extinction of our wildlife.
So perhaps if they opened up the reserve and gave
it back to the
people of Guam, the brown tree snake would be eradicated because
we would chop their heads off.
Mr. Frazer. Perhaps
it
is being considered by the majority of
people in Guam to do so.
Thank you.
Mr. Faleomavaega.
Senators, thank you
both, and Governor
Bordallo, Mr. Stayman representing the Department of the
Inte-
rior.
The record
will be kept open for submission
of any additional
materials that you wish to be made part of the record. The gen-
tleman from Guam.
Mr. Underwood.
I was just wondering
if the Chairman would
note that only witnesses from Guam made an appearance at the
hearing and that that counts for something in considering the leg-
islation.
Mr. Faleomavaega. Very good, Mr. Underwood.
This hearing is adjourned.
[Whereupon, at 4:07 p.m., the Subcommittee was adjourned; and
the following was submitted for the record:]
33
104th congress
2d Session
H.R.3721
To establish the Omnibus Territories Act
IN THE HOUSE OF REPRESENTATIVES
June 26, 1996
Mr. Faleomavaega introduced the following
bill; which was referred
to the
Committee on Resources, and in addition to the Committee on Ways and
Means,
for a
period
to be subsequently determined by the Speaker,
in
each case for consideration of such provisions as
fall within the jurisdic-
tion of the committee concerned
A BILL
To establish the Omnibus Territories Act
1
Be it enacted by the Senate and House of Representa-
2
tives of the United States ofAmerica in Congress assembled,
3
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
4
(a) Short Title.—This Act may be
cited
as the
5
"Omnibus Territories Act of 1996".
6
(b) Table of Contents.—
r
TITLE
I
Repeal the Require.ment of Separate Bau.ots
title
II
American Samoa Study Commission Act
TITLE
III
American Samoa Economic Dev'^lopment Act
TITLE IV
Insular Areas Consolidation Act
TITLE V
American Samoa Capital Infrastructure Fund
34
2
TITLE VI—Guam Land Return Act
TITLE VII
Amendments to the Revised Organic Act of the Virgin
Islands
TITLE VIII
Commission on the Economic Future of the Virgin
Islands
1
TITLE I—REPEAL THE REQUIREMENT OF
2
SEPARATE BALLOTS
3
SEC. JOl. REPEAL OF SEPARATE BALLOT REQUIREMENT.
4
Section 2(a) of the Act entitled "An Act to provide
5
that the unincorporated territories of Guam and the Vir-
6
gin Islands shall each be represented in Congress by a Del-
7
egate to the House of Representatives" approved April 10,
8
1972 (48 U.S.C.
1712(a)),
is amended by striking
", by
9
separate ballot and".
10
TITLE II—AMERICAN SAMOA STUDY
1
COMMISSION ACT
12
SEC. 201. SHORT TITLE.
13
This
title may be
cited
as
the "American Samoa
1
Study Commission Act' '
.
1 5
SEC. 202. CONGRESSIONAL FINDINGS.
16
The Congress finds that
17
(1) the islands of Tutuila and Manua, and cer-
18
tain
other
islands
that compose American
Samoa,
19
were ceded by the chiefs of the islands to the United
20
States by two treaties or deeds of cession which were
21
submitted
to
the United
States Congress on
April
22
10, 1900, and July 16, 1904;
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1
(2) American Samoa's status as an unorganized
2
and unincorporated
territory of the United
States,
3
and American Samoa's
political
relationship
to the
4
United
States, are not clearly defined in any single
5
document;
6
(3)
there
is a need for a comprehensive study
7
and review of the historical and legal basis of Amer-
8
ican Samoa's
political
relationship with the United
9
States, including
10
(A)
a comprehensive
report on American
11
Samoa's present
political
relationship with the
12
United
States,
as compared
to
other
relation-
13
ships
such
as
independence,
commonwealth,
14
free association and covenant; and
15
(B) an examination of whether the treaties
16
or deeds of cession created trust obligations to
17
American
Samoa
on
the
part
of
the
United
18
States;
19
(4) the economic and
social needs of American
20
Samoa
are
substantially
affected by the
nature
of
21
American
Samoa's
political
relationship
with
the
22
United States; and
23
(5)
there
is a need
for a comprehensive study
24
also of Swains Island and
its
historical relationship
25
with the Tokelau Island Group.
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4
1
SEC. 203. ESTABLISHMENT.
2
There is established a commission to be known as the
3
"American Samoa Study Commission Act".
4
SEC. 204. DUTIES.
5
(a) Ix General.—It shall be the duty of the Com-
6
mission
7
(1)
to study and evaluate
all
the
factors that
8
led to American Samoa's historical and present po-
9
litical
relationship
with
the
United
States,
includ-
10
ing
11
(A)
the
events that
led
to the
cession
to
12
the United
States of the
islands that compose
13
American Samoa; and
14
(B)
the
constitutions,
statutes,
treaties,
15
and agreements that
affect American Samoa's
16
political relationship with the United States;
17
(2)
to document and
report on the nature
of
18
American
Samoa's
political
relationship
with
the
19
United States; to document and also report on such
20
political
relationships
as
independence,
common-
21
wealth,
free association and covenant; and to docu-
22
ment and report on whether the deeds of cession cre-
23
ated
trust
obligations
to American Samoa on
the
24
part of the United States;
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(3)
to report on whether a
single document
is
2
needed to set forth American Samoa's pohtical rela-
3
tionship with the United States; and
4
(4)
to study and evaluate the impact of Amer-
5
ican Samoa's
political
status and
relationship with
6
the United States (as determined by the Commission
7
under paragraph
(2))
on
the
economic
and
social
8
needs of American Samoa and its residents.
9
(5)
to study and report on whether the 1900
10
and 1904 Instruments of Cession were indeed trea-
11
ties or deeds and how such instruments
are recog-
12
nized under international law.
13
(b) Consultation.—The Commission
shall,
to the
14 maximum
extent
practicable,
consult
with
American
15
Samoans
in carrying out the
duties
of the Commission
16
under subsection (a).
17
SEC. 205. MEMBERSHIP.
18
(a) Number and Appointment.—The Commission
19
shall be composed of five members appointed as follows:
20
(1) Three members appointed by the Secretary
21
of Interior, including
22
(A)
One member
appointed
from among
23
three
individuals nominated by
the
legislature
24
of
the
Territorial
government
of
American
25
Samoa and
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1
(B) One member
appointed
from among
2
three individuals nominated by the Governor of
3
American Samoa.
4
(2) One member appointed by the Speaker of
5
the United States House of Representatives.
6
(3) One member appointed by the President of
7
the United States Senate.
8
(b) Terms.—Each member shall be appointed for the
9
life of the Commission.
10
(c) Basic Pay.—
11
(1)
Rates
of
pay.—Except
as
provided
in
12
paragraph
(2),
each
member
of
the
Commission
13
shall be paid,
to the extent of amounts made avail-
able
in appropriations Acts, $150 for each day
(in-
cluding travel time) during which the member
is en-
gage
in the actual performance of the duties of the
17
Commission,
^8
(2) Prohibition of compensation of ped-
19
ERAL
EMPLOYEES.—Except
as
provided
in
sub-
20
section
(d), members
of
the Commission who
are
21
full-time
officers or employees of the United States
22
or
the
Territorial government
of American Samoa
23
may not receive additional pay, allowances, or bene-
24
fits by reason of their service on the Commission.
14
15
16
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1
(d) Travel Expenses.—Each member shall receive
2
travel expenses, including per diem in lieu of subsistence,
3
in accordance with sections 572 and 5703 of title 5, Unit-
4
ed States Code.
5
(e) Quorum.—Three members
of the Commission
6
shall constitute a quorum, but a lesser number may hold
7
hearings.
8
(f) CHAIRPERSON; VlCE CHAIRPERSON.—The Chair-
9
person and Vice Chairperson of the Commission shall be
10
elected by the members.
11
(g) Meetings.—
12
(1) Initial meetings.—Not later than the ex-
13
piration date of the 90 day period beginning on the
14
date of the enactment of this Act, the Secretary of
15
the Interior shall call the initial meeting of the mem-
16
bers of the Commission.
17
(2) Subsequent meetings.—The Chairperson
18
or
a
majority
of the members
of the Commission
19
shall call any meeting of the Commission that occurs
20
after the meeting called under paragi*aph (1).
21
SEC. 206. STAFF AND SUPPORT SERVICES.
22
(a) Director.—The Commission shall have a direc-
23
tor, who shall be appointed by the Commission.
24
(b) STiVFF.—Subject to rules prescribed by the Com-
2!
mission, the Chairperson of the Commission may appoint
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1
and fix the pay of personnel as the Chairperson considers
2
appropriate.
3
(e)
Applicability
of
Certain
Civil
Service
4
Laws.—The Director and
staff of the Commission may
5
be appointed without regard to the provisions of title
5,
6
United States Code, governing appointments in the com-
7
petitive
service, and may not be paid without regard to
8
the provisions of chapter 51 and subchapter III of chapter
9
53
of such
title
relating
to
classification
and
General
10
Schedule pay rates, except that an individual so appointed
1
may not receive pay
in excess of the maximum
rate
of
12
basic pay payable for GS-16 of the General Schedule.
13
(d) Experts and Consultants.—Subject to rules
14
prescribed by
the
Commission,
the Chairperson
of the
15
Commission may
procure
temporary
and
intermittent
16
services under section 3109(b)
of
title
5, United
States
17
Code, but at rates for individuals not to exceed $150 per
18
day.
19
(e)
Administrative
Support
Services.—Upon
20
the request of the Commission, the Administrator of Gen-
21
eral Services shall provide to the Commission, on a reim-
22
bursable
basis,
the
administrative
support
services
nec-
23
essaiy for the Commission to carry out its responsibilities
24
under this Act.
HR 3721 IH
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1
SEC. 207. POWERS OF COMMISSION.
2
(a) Hearings.—
3
(1)
In general.—The Commission
may,
for
4
the purpose of carrying out this Act, hold hearings,
5
sit and act
at times and locations, take testimony,
6
and
receive
evidence
as
the Commission
considers
7
appropriate.
'
8
(2) Location of certain hearings.—
.;
9
(A) Required hearings.—The Commis-
10
sion shall conduct at least
1 hearing at any lo-
1
cation on each of
12
(i) Tutuila;
13
(ii)Ofu;
.: A-
14
(iii) Olosega; and
.
,
15
(iv) Tau.
16
(B) Other hearings.—The Commission
17
may conduct at least 3 separate hearings in the
18
United
States
at
locations
where
significant
19
numbers of American Samoans reside.
20
(3)
Notice.—The
Commission
shall
provide
21
notice
to the
public of the hearings
referred
to
in
22
paragraphs
(1)
and
(2),
including
information
re-
23
garding the date, topic and location of the meeting,
24
and shall take other actions as the Commission con-
25
siders necessary to
obtain,
to the maximum
extent
26
practicable, public participation in the hearings.
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(b) Delegation of Authority.—^Any member or
2
agent of the Commission may,
if authorized by the Com-
3
mission, take any action that the Commission
is author-
4
ized to take by this Act.
5
(c) ObtaIxVing Official Data.—
6
(1)
In' general.—The Commission may secure
7
directly from any Federal agency information
nec-
8
essary to enable
it to carry out this Act. Upon the
9
request of the Chairperson of the Commission,
the
10
head of the Federal Agency shall furnish the infor-
1
mation to the Commission.
12
(2)
Exception.—Paragraph
(1)
shall
not
13
apply
to any
information
that
the
Commission
is
14
prohibited to secure or request by another law.
15
(d)
Mail.—The Commission may
use
the
United
16
States mail in the same manner and under the same con-
1
ditions as the other Federal agencies.
1 8
SEC. 208. REPORTS.
19
(a) Draft Report.—
20
(1)
In general.—Not
later than
the
expira-
21
tion of the
1-year period beginning on the date of
22
the enactment of this Act, the Commission shall pre-
23
pare and publish a draft report containing the fmd-
24
ings, conclusions and recommendations of the Com-
25
mission.
'
'»'
'*'
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1
(2) Distribution.—The Commission shall dis-
2
tribute
such
report
to
appropriate
Federal
and
3
American Samoan agencies and shall make such re-
4
port
available
to members
of the
public upon
re-
5
quest.
6
(3)
Solicitation of comments.—The Com-
7
mission shall solicit written comments from the Fed-
8
eral and American Samoan agencies and other per-
9
sons to which copies of such report are distributed
10
under paragraph (2).
11
(b) Final Report.—Not
later than the expiration
12
of the 9-month period beginning on the date of the publi-
13
cation
of the
report
required by
subsection
(a)(1),
the
14
Commission
shall submit to the President and the Con-
1
gress a final report, which shall include
16
(1)
a
detailed
statement
of the
findings and
17
conclusions made by the Commission after consider-
18
ation of the comments received by the Commission
19
under subsection (a)(3);
20
(2) the recommendations of the Commission for
21
legislative and administrative actions that the Com-
22
mission determines to be appropriate; and
23
(3)
copies of
all written comments
received by
24
the Commission under subsection (a)(3).
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1
SEC. 209. DEFINITIONS.
2
For the purpose of this Act:
3
(1)
The
term
"American
Samoan"
has
the
4
meaning given the term "native American Samoan"
5
in
section
4
of Pubhc Law
100-571
(16
U.S.C.
6
410qq-3).
7
(2) The term "Commission" means the Amer-
8
iean Samoa Study Commission estabhshed in section
9
3.
1
SEC. 210. AUTHORIZATION OF APPROPRIATIONS.
1
There is authorized to be appropriated such sums as
12
are necessary^ to carry out the provisions of this Act.
13
SEC. 211. TERMINATION.
14
The Commission
shall terminate not
later than the
15
expiration of the 60-day period beginning on the date on
16
which the Commission submits
its final report under sec-
17
tion 8.
1
TITLE III—AMERICAN SAMOA ECONOMIC
19
DEVELOPMENT ACT OF 1995
20
SEC. 301. SHORT TITLE.
21
This title may be cited as the "American Samoa Eco-
22
nomic Development Act of 1996".
23
SEC. 302. FINT)INGS.
24
The Congress finds that
25
(1)
funding for the United
States
territory of
26
American Samoa has been based on the joint resolu-
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13
1
tion entitled "Joint Resolution to provide for accept-
2
ing,
ratifying, and confirming cessions of certain
is-
3
sues of the Samoan group to the United States, and
4
for other purposes", as amended (48 U.S.C.
1661),
5
with commitments being made on a yearly basis;
6
(2)
American
Samoa
is
locally
self-governing
7
with a constitution of its own adoption and the
di-
8
rect election of the Governor since 1977;
9
(3)
the
territory
of American Samoa has had
10
difficulty in planning and implementing comprehen-
11
sive and
sustainable
infrastructure based
solely on
12
annual ad hoc grants; and
13
(4)
the
territory
of American Samoa and
the
14
United States would benefit from a multi-year fund-
15
ing commitment which promotes economic
develop-
16
ment and
self-sufficiency, and
requires
compliance
17
with
financial
management
accounting
standards,
18
the establishment
of semiautonomous
public
utility
19
authorities utilizing cost-recovery principles, and the
20
phaseout of Federal subsidies for Government oper-
21
ations.
22
SEC. 303. AUTHORIZATION OF FUNDING.
'
23
(a) Ix General.—There are authorized to be appro-
24
priated to the Secretary of the Interior for the Govern-
25
ment of American Samoa $10,000,000 for each of fiscal
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14
1
years 1998 through 2003. Such amounts shall be used for
2
construction
and
repair
of
capital
assets
of American
3
Samoa.
4
(b)
Multi-year
Availability
of
Appropria-
5
TIOXS.—^Amounts not expended in the year appropriated
6
shall remain available until expended.
7
TITLE IV—INSULAR AREAS
8
CONSOLIDATION ACT
9
SEC. 401. SHORT TITLE.
10
This title may be cited as the "Insular Areas Consoli-
11
dation Act of 1996".
12
SEC. 402. ADDITIONS TO TERRITORY OF AMERICAN SAMOA.
13
(a) In General.—The Territory of American Samoa
14
shall
include Baker Island,
Jarvis
Island, and Rowland
15
Island.
16
(b)
Jurisdiction.—The
islands
specified
in
sub-
17
section (a) shall be subject to the jurisdiction of the Terri-
1
tory of American Samoa to the same extent as and in the
19
same manner that such jurisdiction
applies to
all other
20
areas within the territory.
21
(c) Rights of the United States.—The inclusion
22
of islands, appurtenant reefs, and territorial waters in the
23
Territorv' of American Samoa by this section shall be sub-
24
ject to existing rights of use, ownership, management, and
25
operation by the Government of the United States.
HR 3721 IH
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15
1
SEC. 403. CONFORMING AMENDMENTS.
2
SEC. 404. USE OF ISLANDS, REEF, AND ATOLLS.
3
No provision of this
title shall be construed as con-
4
gressional approval, suggestion, or intent to alter, change,
5
affect, or reduce the current use of any of the
islands,
6
reef, or atolls specified in section 302(a).
7
SEC. 405. ADDITIONS CONTINGENT UPON ACCEPTANCE BY
8
TERRITORY OF AMERICAN SAMOA.
9
(a)
Acceptance
By
Territory
of
American
10
Samoa.—Sections 302 and 303
shall not take effect ufi-
1
less the Governor and Legislature of American Samoa cer-
12
tify
to
the
President
that
the
Territory
of American
1
Samoa accepts all of the islands, reefs, and atolls referred
14
to in section 302(a).
15
(b) Proci^mation By President.—Not later than
16
30 days after receiving the last certification described in
17
subsection
(a),
the President
shall
issue a proclamation
1
of the new geographical jurisdiction of American Samoa.
19
(c) Effective Date.—Sections 302 and 303
shall
20
take
effect upon
the
issuance
of the
proclamation
de-
21
scribed in subsection (b).
22
SEC. 406. DEFINITIONS.
23
For purposes of this title:
24
(1) Baker island.—The term "Baker Island"
25
means
all
of the .islands and appurtenant
reefs
at
26
the parallel of
degrees, 11 to 13 minutes, of lati-
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1
tude north
of the Equator and
at
the meridian
of
2
176 degrees, 27 to 30 minutes, of longitude west of
3
Greenwich,
England,
and
the
territorial waters
of
4
such islands and reefs.
5
(2) Rowland
island.—The
term
"Howland
6
Island"
means
all
of
the
island
and
appurtenant
7
reefs at the paralled of
degrees, 45 to 50 minutes,
8
of latitude north of the Equator and at the meridian
9
of 176 degrees, 37 to 39 minutes, of longitude west
10
of Greenwich, England, and the territorial waters of
11
such islands and reef,
12
(3) Jarvis island.—The term "Jarvis Island"
13
means
all
of the
islands and appurtenant
reefs
at
14
the paralled of
degrees, 22 to 24 minutes, of lati-
15
tude south
of the Equator and
at the meridian
of
16
160
degrees,
to
3
minutes,
of longitude west
of
17
Greenwich,
England,
and
the
territorial
waters
of
18
such islands and reef.
19
TITLE V—AMERICAN SAMOA CAPITAL
20
INFRASTRUCTURE FUND
2
SEC. 501. SHORT TITLE.
22
This title may be cited as the "American Samoa Cap-
23
ital Infrastructure Fund Act".
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SEC. 502. AMENDMENT OF SUBSECTION 703(a) OF PUBLIC
2
LAW 94-241.
3
The second sentence of subsection 703(a) of Public
4 Law 94-241, as amended,
is hereby amended to read as
5
follows: "Funds provided under Section 702 will be consid-
6
ered to be local revenues when used as the local share re-
7
quired to obtain federal pro-ams and services."
8
TITLE VI—GUAM LAND RETURN ACT
9
SEC. 601. SHORT TITLE.
10
This Act may be cited as the "Guam Land Return
11
Act".
(
12
SEC. 602. OPPORTUNITY FOR GUAM TO ACQUIRE EXCESS
1
REAL PROPERTY IN GUAM.
14
The Organic Act of Guam (48 U.S.C. 1421 et seq.)
15
is amended by adding at the end the following new title:
16
"Sec. xx.
(a) At least 180 days before transferring
17
to any Federal
agency
excess
real
property
located
in
18
Guam, the Administrator of General Services shall notify
19
the government of Guam that
the property
is
available
20
under this section.
21
"(b) The Administrator shall transfer to the govern-
22
ment of Guam
all right,
title, and interest of the United
23
States
in and to excess
real property located
in Guam,
24
by quit claim deed and without reimbursement, if the gov-
25
ernment of Guam, within4§P days after receiving notifica-
26
tion under subsection
(a) regarding the property, notifies
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18
1
the Administrator that the government intends to acquire
2
the property under this section.
3
"(c) For purposes of this action, the term 'excess real
4
property' means excess property (as that term
is defined
5
in section 3 of the Federal Property and Administrative
6
Services Act of 1949, as in effect on the date of enactment
7
of the Guam Land Return Act) that
is
real property.".
8
SEC. 603. RELEASE OF LANDS FROM CONDITION ON DIS-
9
POSAL BY GUAM.
10
(a) I\ General.—Section 818(b)(2) of Public Law
11
96-418 (94
Stat.
1782),
relating to a condition on
dis-
12
posal by Guam of lands conveyed to Guam by the United
13
States, shall have no force or effect and is repealed.
14
(b) Execution of Instruments.—The
Secretary
15
of the Navy and the Administrator of General
Services
16
shall execute
all instruments necessary to implement this
17
section.
18 TITLE
VII—AMENDMENTS
TO
THE
RE-
19
VISED ORGANIC ACT OF THE VIRGIN
20
ISLANDS.
2 1
SEC. 701. SHORT TITLE.
22
This Act may be cited as the "Revised Organic Act
23
of the Virgin Islands, amended".
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19
1
SEC. 702. AMENDESiG THE DEFINITION OF "TEMPORARY AB-
2
SENCE".
3
Section
7(a)
of Public Law 90-496
(82
Stat.
839),
4
as amended,
is
further amended by adding-
at the end
5
thereof "As used in this section, the term 'temporary ab-
6
sence'
shall not be construed as being physically absent
7
from the territory while on official Government business.".
8
SEC. 703. AMENDING SECTION 3 OF PUBLIC LAW 94-392.
9
Section 3 of Public Law 94-392 (90 Stat. 1195), as
10
amended, is further amended as follows:
11
(1) By inserting' "hereinafter" between "obliga-
12
tions" and "issued".
13
(2) By deleting "priority for payment" and
in-
14
serting in lieu thereof "a parity lien with every other
1
issue of bonds or other obligations hereinafter issued
16
for payment".
17
(3) By
deleting
"in
the
order
of the
date
of
18
issue".
19
SEC. 704. CERTAIN BONDS EXEMPTED FROM PROVISIONS
20
OF SECTION 149 OF THE INTERNAL REVENUE
2 1
CODE OF .198€i, AS AMENDED.
22
The
provision
of
section
149(d)(3)(A)(i)(I)
and
23
149(d)(2)
of
the
Internal
Revenue
Code
of
1986,
as
24
amended, shall not apply to bonds issued
25
(1) by an
authority created by
statute
of the
26
Virgin Islands legislature, the proceeds of which will
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1
be used to advance refund certain bonds issued by
2
such authority on July 8, 1992; or
3
(2) by an
authority created by
statute
of the
4
Virgin Islands legislature, the proceeds of which will
5
be used to advance refund certain bonds issued by
6
such authority on November 3, 1994.
7
SEC. 705. APPLICATION OF AMENDMENTS IN SECTIONS 703
8
AND 704.
9
The amendments made by sections 703 and 704 shall
10
apply to obligations issued on or after the date of enact-
1
ment of this title.
12 TITLE
VIII. COMMISSION ON THE ECO-
13
NOMIC FUTURE OF THE VIRGIN
IS-
14
LANDS
1
SEC. 801. ESTABLISHMENT AND MEMBERSHIP.
16
(a) There is hereby established a Commission on the
17
Economic Future
of the Virgin
Islands
(the "Commis-
18
sion"). The Commission shall consist of six members ap-
19
pointed by the President, two of whom
shall be selected
20
from nominations made by the Governor of the Virgin Is-
21
lands. The President shall designate one of the members
22
of the Commission to be Chairman.
23
(b) In addition to the six members appointed under
24
paragi'aph
(1), the Secretary of the Interior shall be an
25
ex-officio member of the Commission.
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1
(c) Members
of the Commission
appointed by the
2
President
shall be persons who by virtue of their back-
3
ground and experience are particularly suited to contrib-
4
ute to achievement of the purposes of the Commission.
5
(d) Members of the Commission
shall serve without
6
compensation, but shall be reimbursed for travel, subsist-
7
ence and other necessary expenses incurred by them
in
8
the performance of their duties.
9
(e) Any vacancy in the Commission shall be filled in
10
the same manner as the ori^nal appointment was made.
1
SEC. 802. PURPOSE AND REPORT.
'
12
(a) The purpose of the Commission
is to make rec-
13
ommendations to the President and^Congress on the poli-
14
cies and programs necessary to provide for a secure and
15
self-sustaining future for the local economy of the Virgin
16
Islands through 2020 and on the role of the Federal Gov-
17
ernment
in providing for that future.
In developing rec-
1
ommendations, the Commission shall
19
(1)
solicit information and advice from persons
20
and
entities
that
the Commission
determines have
21
expertise to assist the Commission in its work;
22
(2)
examine and
analyze
historical data
since
23
1970
on
expenditures
for
infrastructure and
serv-
24
ices;
HR 3721 m
54
22
1
(3)
analyze the
sources of funds
for such
ex-
2
penditures;
3
(4)
assemble
relevant
demographic
and
eco-
4
nomic data, including trends and projects for the fu-
5
ture; and
6
(5) estimate future needs of the Virgin Islands,
7
including
needs
for
capital
improvements,
edu-
8
cational needs and
social, health and environmental
9
requirements.
10
(b) The recommendations of the Commission shall be
11
transmitted
to the President, the Committee on Energy
12
and Natural Resources of the United States Senate and
13
the Committee on Resources of the United States House
14
of Representatives no later than December
1, 1997. The
15
recommendations
shall be accompanied by a report that
16
sets forth the basis for the recommendations and includes
17
an analysis of the capability of the Virgin Islands to meet
18
projected needs based on reasonable alternative economic,
19
political and social conditions in the Caribbean, including
20
the opening in the near future of Cuba to trade, tourism
21
and development.
22
SEC. 803. POWERS.
23
(a) The Commission may
HR 3721 IH
55
23
1
(1)
hold
such
hearings,
sit
and
act
at
such
2
times and
places,
take such testimony and
receive
3
such evidence as it may deem advisable;
4
(2)
use
the
United
States
mail
in
the
same
5
manner and upon the same conditions as other de-
6
partments and agencies of the United States;
7
(3) enter into contracts or agreements for stud-
8
ies and surveys with public and private organizations
9
and transfer funds to Federal agencies to carry out
10
such
aspects of the Commission's functions
as the
11
Commission determines can best be
carried out
in
12
such manner; and
13
(4) incur such necessary expenses and exercise
14
such other powers as are consistent with and reason-
15
ably required to perform its functions.
16
(b) The Secretary of the Interior shall provide such
17
office
space,
furnishings and equipment
as may be
re-
18
quired to enable the Commission to perform its functions.
19
The Secretary shall also furnish the Commission with such
20
staff, including clerical support, as the Commission may
21
require and shall provide to the Commission financial and
22
administrative services, including those relating to budget-
23
ing,
accounting,
financial
reporting,
personnel and
pro-
24
curement.
.
•
i _
HR 3721 IH
,;
..
r jiH
56
24
1
(c) The President, upon request of the Commission,
2
may direct the head of any Federal agency or department
3
to
assist the Commission and
if so
directed such head
4
shall—
5
(1)
furnish the Commission
to the extent per-
6
mitted by law and
within
available
appropriations
7
such information as may be necessary for carrying
8
out the functions of the Commission and as may be
9
available
to
or
procurable by
such
department
or
10
agency; and
11
(2)
detail to temporary duty with the Commis-
12
sion on a reimbursable basis such personnel within
13
his
administrative
jurisdiction
as
the
Commission
14
may need or believe to be useful for carrying out its
15
functions, each such detail to be without loss of se-
16
niority, pay or other employee status.
17
SEC. 804. CHAIRMAN.
18
Subject to general policies that the Commission may
19
adopt, the Chairman of the Commission shall be the chief
20
executive officer of the Commission and shall exercise
its
21
executive and administrative powers. The Chairman may
22
make such provisions as he may deem appropriate author-
23
izing the performance of his executive and administrative
24
functions by the staff of the Commission.
HR 3721 IH
57
25
1
SEC. 805. APPROPRIATIONS.
2
There are authorized to be appropriated such sums
3
as may be necessary to carry out the purposes of this sec-
4
tion.
5
SEC. 806. TERMINATION.
6
The Commission shall terminate three months after
7
the transmission of the report and recommendations under
8
subsection (b)(2).
O
HR 3721 IH
58
STATEMENT OF ALLEN P. STAYMAN, DIRECTOR, OFFICE OF INSULAR AFFAIRS
DEPARTMENT OF THE INTERIOR, BEFORE THE HOUSE SUBCOMMITTEE ON NATIVE
AMERICAN AND INSULAR AFFAIRS,
REGARDING WATER ISLAND,
ELECTION OF
GUAM'S
ATTORNEY
GENERAL,
AND
H.R.
3721,
A BILL
TO
ESTABLISH
THE
OMNIBUS TERRITORIES ACT,
JULY
24,
1996
Mr. Chairman and members of the Subcommittee on Native American and
Insular
Affairs,
I
am
pleased
to
appear
before
you
for
this
oversight
hearing
on
Water
Island,
election
of
Guam's
Attorney
General,
and H.R.
3721,
the Omnibus Territories Act
of
1996.
WATER ISLAND TRANSFER
Mr.
Chairman,
the Department of the Interior has been the owner and
lessor of Water Island, United States Virgin Islands,
for more than
forty years.
Since
before
the
expiration
of
the master
lease
in
1992,
the Department
has
sought
to dispose of
its
interest
in the
island.
The
process
has
been
long
and
arduous
--
involving
the
master lessee,
residential
sublessees,
Sprat Bay Corporation,
the
Government
of
the
Virgin
Islands,
and
the
courts.
We
are
confident,
however,
that
the process
is coming to
a
close,
with
a
fair and reasonable
result.
On
May
23,
1996,
in
letters
to
Virgin
Islands
Governor,
Roy
L.
Schneider,
Water
Island
sublessees
and other
interested parties,
the Department outlined
its plan for disposing of
its
interest
in
Water
Island.
o
Each sublessee will have
an opportunity to purchase
fee
simple
title
to
the
subleased
land on which
his
or
her
Water
Island residence
is
located
for $17,500
an acre.
o
The Government
of
the Virgin
Islands will be given
fee simple title to non-subleased portions of Water
Island
for
public
purposes
in
exchange
for
assumption
of
certain
responsibilities
by
the
Government
of
the
Virgin
Islands
including
the
provision
of
public
municipal
services,
cleanup
from storm damage,
and dock and ferry services.
In
resolution
of
a
suit
by
the
master
lessee
against
the
Department,
before
Judge
Roger
Andewelt,
United
States
Court
of
59
Federal Claims,
the parties submitted a formal settlement agreement
by which the Department will pay the master lessee $7.5 million for
the
lessee's
possessory
interest
in
Water
Island.
Revised
settlement stipulations are expected to become effective on August
2,
1996,
in order to give interested parties an opportunity to seek
an injunction against the master lease holder to prevent
a transfer
of certain
funds.
With the Judge's expected approval
of
the settlement
on August
2,
1996,
we
anticipate
moving
forward
with
formal
offers
to
the
sublessees
for
sale
to
them
of
their
respective parcels
of
land,
and
the
transfer
to
the
Government
of
the
Virgin
Islands
of
the
remaining
land
on
the
island.
We
believe
that
this
long
Water
Island transfer process
is drawing to a close.
We are proud of the
fair
and
reasonable
result
that
will
benefit
the
sublessees,
the
Government
of
the Virgin
Islands,
and the Federal government.
GUAM ATTORNEY GENERAL
The
Legislature
of
Guam
in Resolution
No.
433
(LS)
requests
that
the
Organic
Act
of
Guam
be
amended
to
require
election
of
the
Attorney
General
of
Guam.
At
present,
the
Attorney
General
is
appointed by and serves
at
the pleasure
of
the Governor of
Guam.
I believe that the issue of appointment or election of the Attorney
General
is
a
local
self-government
issue,
which should be decided
in Guam.
We have been given the opinion of
the
legislature.
The
Subcommittee may wish
to
solicit
the opinion of
the Governor
and
Judiciary,
or even the people
of Guam.
Because this
is strictly a self-government issue,
the Department of
the
Interior
takes
no position
on
the
matter,
at
this
time.
We
would,
however,
likely support a position based on consensus
from
Guam.
H.R.
3721
--
OMNIBUS TERRITORIES ACT OF 1996
Title
I
-- Delegate Balloting
Title
I would repeal the requirement that a separate ballot be used
in elections
of
delegates
from Guam and
the Virgin
Islands.
The
rationale
for
this
title
is
that
the
requirement
of
a
separate
ballot
impedes
voting
and
tabulation
efficiency.
The
Administration agrees .and has no objection to title
I.
It
should
be
noted,
however,
that
title
I
deals
only
with
the
ballots
for
delegates
from
Guam
and
the
Virgin
Islands.
The
election of the delegate from American Samoa is treated separately
in
Public
Law
95-556
(48
U.S.C.
1731,
1732)
.
Title
I
would
not
affect
American
Samoa's
ballot
for
delegate,
which
would
remain
separate
from other ballots
in the territory.
60
Title
II
-- American Samoa Study Commission
Title
II
would
establish
a
five-member
American
Samoa
study
commission
to
conduct
a
comprehensive
study
of
American
Samoa's
political
status.
The
proposed
commission
would
(1)
study
and
evaluate
all
factors
that
led
to
American
Samoa's
political
relationship
with
the
United
States,
(2)
document
the
nature
of
that
relationship,
(3)
report
on
alternative
political
relationships such as independence,
commonwealth,
free association
and
"covenant,"
(4)
document
whether
or
not
the
deeds
of
cession
created a trust relationship,
(5)
report on whether or not
a single
document
is
needed
to
set
forth
American
Samoa's
political
relationship
with
the
United
States,
(6)
study
and
evaluate
the
effect
of
American
Samoa's
political
status
on
the
economic
and
social needs of American Samoa and its residents,
and
(7)
study and
report on whether or not the instruments of cession are treaties or
deeds,
and the recognition given them
in international
law.
VJhile
Administration
policy
discourages
the
establishment
of
commissions,
I would like to address issues relating more directly
to political
status.
First,
it
is unclear what the ultimate purpose of the commission's
activities would be.
Therefore,
it
is difficult
to determine
the
appropriateness and extent
of
the Federal
role
in such
a
commission.
Second,
the
commission's
duties
suggest
a
need
for
change
in
American
Samoa's
political
status.
I
believe
that
initial
discussions on political status should be undertaken
at
the
local
level,
in American
Samoa,
and
that
the
Federal government
should
become
involved
only
after
some
local
consensus
has
been
established.
For
example,
both
Guam
and
the
Virgin
islands
established
local
status commissions to examine such questions.
In Guam's case,
its
locally established
commission process
led
to
a
local
plebiscite
and
a petition to
the Congress.
In the Virgin
Islands'
case,
the
locally
established
commission
developed
a
plan
and
held
a
plebiscite.
However,
because no local consensus emerged from the
electorate,
the process ended before Federal
involvement.
I
recommend
that
any such
status
evaluation process
be
initiated
locally,
in American Samoa,
and that Federal involvement be delayed
until
there
is
a
local consensus
for change.
Title
III
-- American Samoa Development Act of
1995
Title
III
includes
findings
that
laud
the
benefits
of multi-year
funding,
and
a proposal authorizing up
to
$10 million
a year
for
fiscal years
1998
through 2003
for capital development.
However,
no additional language
is included that would guarantee that
funds
M
will
actually
be
appropriated
for
American
Samoa
capital
infrastructure
in any of the years
1998 through 2003.
Thus,
while
the authorization is multi-year,
appropriations need not be.
Since
1929, American Samoa has received Federal funds under an unlimited
and on-going authorization.
A second,
and limiting,
authorization
is unnecessary.
Of greater significance
is the fact that
a true multi-year funding
source was identified by the Department and became law earlier this
year
as
section
118
of
Public
Law
104-134.
Section
118
re-
allocates Northern Mariana
Islands mandatory Covenant grants
as
a
source
of
multi-year
capital
funding
for
all
territories.
While
this
act
does not earmark specific amounts
for American Samoa,
it
is anticipated that American Samoa,
the territory with the greatest
need,
will
receive
the
largest
share
of
the
Covenant
funds
available
for
capital
infrastructure.
The
Administration,
in
response
to
a
letter
from
Delegate
Faleomavaega,
estimated
that
American Samoa will receive a minimum of $9.1 million annually from
this guaranteed source,
beginning with fiscal year
1998.
Because
this
law
is
already
on
the
books,
the
Administration
opposes enactment
of
title
III
as unnecessary.
Title
IV
--
Insular Areas Consolidation Act
Under title
IV
(which includes several technical errors)
,
Howland,
Baker,
and Jarvis
islands,
in the
Pacific,
would become
a part
of
the
territory
of
American
Samoa.
They
are
currently
under
the
jurisdiction
of
the
Department
of
the
Interior.
The
bill,
in
sections
402(c)
and
404,
would
recognize
and
preserve
existing
Federal uses,
ownership,
and management,
and other current uses of
these
islands when transferred.
Last
year,
a
hearing was
held on
the
Insular Areas
Consolidation
Act
contained
in
title
III
of
H.R.
602,
which
would
transfer
numerous Pacific
islands,
including Howland,
Baker,
and Jarvis
to
the
state
of
Hawaii.
Additionally,
on
June
25,
1996,
Hawaii
Senator Daniel Akaka introduced a similar bill.
The Department of
the
Interior
supported
enactment
of
title
III
of
H.R.
602,
conditioned
on
a
clarification
that
territorial
waters
and
the
jurisdiction
of
states
extend
only
three
miles
from
the
state's
fastland baseline.
The
proposal
before
us
today,
favoring
American
Samoa,
is
in
conflict with H.R.
602, which would favor Hawaii.
The Department's
primary concern is for the protection of existing Federal interests
in
these
islands
and
the
surrounding
sea,
not
which
political
jurisdiction
would
receive
these
islands.
Recognizing
that
the
Constitution,
in Article
IV,
section
3 clause
2, gives the Congress
plenary
authority
over
the
territory
of
the
United
States,
we
believe that the Congress is the proper institution for determining
the
disposition
of
Howland,
Baker,
and
Jarvis,
as
well
as
other
27-245 0-96
62
American
Pacific
islands.
If
and
when
such
a
determination
is
made,
the
Administration
requests
that
attention
be
paid
to
the
views expressed in departmental testimony on H.R.
602 regarding the
territorial
sea
and
exclusive
economic
zone,
and
that
any
legislation should be amended accordingly.
Title V
-- American Samoa Capital Infrastructure Fund
Funds appropriated under
the Commonwealth of
the Northern Mariana
Islands
(CNMI)
Covenant
were
subject
to
the
second
sentence
of
section
703(a)
of
the Covenant which
states:
Funds provided under Section 702 will be considered to be
local revenues of the Government of the Northern Mariana
Islands when used as
the
local share required
to obtain
federal programs and services.
Section
118
of
Public
Law
104-134
shifts
a major portion
of
this
CNMI
funding
to
ocher
territories.
The
amendment
in
title
V
is
intended
to allow other
territorial
recipients
of
the
redirected
Covenant
funds
to
utilize
such
funds
as
the
local
share
for
the
purposes
of
federal program and services.
The Administration endorses
the concept
of
title
V,
clarification
of
federal
program
matching.
We
do
suggest,
however,
that,
to
avoid possible confusion,
the provision be re-drafted to conform to
language
adopted
earlier
this
month
by
the
Senate
Committee
on
Appropriations.
(See attachment.)
Title VI
--
Gucun Land Return Act
Section
602
of
title
VI,
as currently drafted,
authorizes Guam to
acquire federal excess lands on the island at no cost and ahead of
Federal
agencies.
Such
land
acquisition
is
conditioned
on
Guam
exercising
its option within
180 days after notice by the General
Services Administration that the property is excess to the needs of
a
transferring Federal
agency.
In
essence,
section
602
provides
Guam with
the
right
of
first
refusal
on
all
Federal
excess
lands
situated on Guam.
Interior Concerns
The Department
has serious concerns with section 602
as currently
drafted.
By
directing
the
Federal
government
to
automatically
transfer all
right,
title and interest
in Federal excess
lands
to
the
Government
of
Guam,
the
Congress
in
section
602
would
waive
provisions of the National Environmental Policy Act
(NEPA)
and the
Endangered
Species
Act,
as
well
as
other
Federal
laws.
The
63
Department of Defense and other agencies have additional concerns.
Section
602
also makes
no provision
for habitat
conservation
and
endangered species protection
in the event of outright transfer to
the Government of Guam.
Finally,
section 602 would contravene the
terms
of
the
settlement
agreement
that
established
the
overlay
refuge
in lieu of designation of critical habitat
for
a number of
threatened and endangered species.
For these reasons,
we strongly
oppose section
602,
as
introduced.
A Break with the Past
--
The Orange County Experience Can Be
Guaun' s Experience
The Administration believes
that economic development and habitat
protection
are
not
mutually
exclusive.
This
Administration
has
worked hard with states and private
landowners
to
find innovative
solutions
that allow development activities while protecting fish
and wildlife,
including
threatened
and endangered
species.
Guam
can
benefit
from
these
innovative
approaches
initiated
by
this
Administration.
Orange
County,
California provides
a
recent
demonstration
of
the
new attitude and effective approach to reconciling development and
habitat preservation.
The Irvine Company in Orange County and the
California Resources Agency met with Secretary Babbitt
in
1993
to
aid
species
preservation
and
give
certainty
to
real
estate
developers.
This
effort
led
to
the
completion
of
a
habitat
conservation plan developed under the Endangered Species Act
that
involved Federal,
state,
county, and municipal governments, private
land
developers,
and
other
property
owners.
The
result
was
a
consensus process in Orange County to protect the overall ecosystem
for
a number
of
species
by setting
aside habitat
in one place
in
return
for permission to develop and build
in another.
This type
of
innovative
and
consensus
building
approach
could
serve
as
e
positive
example
to
those
who
are
interested
in
protecting
the
natural heritage
of Guam while seeking economic opportunities.
The Future
--
Federal Land Return and Reconciliation
The
Orange
County
Habitat
Conservation
Plan
was
developed
under
sections
10(a)
and
4(d)
of
the
Endangered
Species
Act
and
deals
with
private
lands.
In
Guam,
a
habitat
conservation
plan
on
private
and
Guam
owned
lands
could
be
merged
with
a
habitat
protection agreement on Federal lands to provide protection for all
threatened
or
endangered
species
on
Guam.
The
salient
point
is
attitude:
the
Department
of
the
Interior
seeks
a
reconciliation
that meets both development and habitat protection needs.
The
Department
will
work
hard
with
the
military,
Government
of
Guam,
and
private
interests
to
develop
innovative
measures
for
protecting threatened and endangered species at the same time as we
seek
to
protect
the
significant
interests
of
Guam
in
future
unneeded military lands.
64
The
Department
is
also
prepared
to
enter
into
di
resolve
these
concprn.c
h^^^^
^^
...„
_
.
^.°
^^
maximize
the
amount
o£
unneeded
Federal
t^J;^'
,
°""
"'
Government
of
Guam,
and
(2)
orovirt,
ti
>
"
^° "
"=•>«
threatened and endangered species and th»i-h'i'h,>
P""«ion
to
with
the
Endangered Species
Act
Tf
M,.
h^ibltat m accordance
such
a
habxtit
pro?:ct!on
^reemeM
"^t^e^'irnS "
''f^''°Z'
^oS?^L"fo.rct agr"etm",« -^„ >h Jui^a^n"" "-""« "-= '-
may be possible
to transfer unneeded Federal
la'nTt"„' r" ^^^"l "
amending
the
Federal
Property and
/dm'r'fs^rat'rv^e" Se'rvl^^^s "ac t °of
to'^Jth''e'/""trde?e''r;?nt
"aTt'et
%'o'n°s"idjiin '" a" T'^'
'° "^^
Scl-Sc-foT-^i-s-raJ- t^HH
endangered
species.
other
llnds "oulT tht^'L" f r"e"d Vr' oS
uses
hLi^t°i?
^°
^""^"^
^°^
^"
expression
of
interest
in
develooina
a
Brooks Amendment
S?^i°\e^\rr"the-rta?S'Sn"Vf^' ;,^Ufts^"^ti"tS" ?^d:ifi
= S"the-^-e\"r^J%-J'icfr
the''L'idl°to"tTe"'ha"st %^i^l:, '"?he'i™'f ="-
'' ^'^^P
would allow the Gover'nment ^of ITuam
to be'nefff'from t'he"f forts'it
expends on developing land transferred from the Federal g^vlj^^ent
The Administration supports enactment
of section
603.
65
Title VII
Amendments
to
the Revised Organic Act
of
the Virgin Islands
Subsection
(a)
of
title VII
is
intended to deal with the transfer
of
the
authority
of
the
Governor
of
the
Virgin
Islands
when
the
Governor
is
absent
from
the
Virgin
Islands.
My
testimony
last
month
on
section
2
of
H.R.
3634
dealt
with
the
same
subject
but
included
the
lieutenant
governor.
I
supported
enactment
of
the
H.R.
3 634 provision.
I recommend that the temporary absence issue
canbest be resolved by deleting sections 701 and 702
of H.R.
3721
and inserting
in
lieu thereof
section
2
of
H.R.
3634.
Sections
703
through
705
deal
with
the
bonding
authority
of
the
Virgin
Islands
when
its
bonds
are
secured
by
the
cover
over
of
Federal excise taxes on rum.
The provisions would allow the Virgin
Islands
to
issue parity debt,
rather than priority debt.
Current
law
gives
greater
protection
to
earlier
issuances
of
debt
over
later
issuances,
with
the
result
that
later
debt
is
subject
to
increased
interest
and
fees.
We
understand
that
most
local
jurisdictions
now
issue
parity
debt
instruments.
The
bonding
provisions of title VII would place the Virgin islands on a footing
similar
to other communities.
The Administration
has
no objection
to
the
enactment
of
sections
703
and
705
of
title
VII.
However,
section
704
would
amend
the
Internal
Revenue
Code
to
provide
special
relief
for
the
Virgin
Islands with regard to two outstanding tax-exempt bond issues.
The
provision would allow these two bond issues to be advance refunded,
essentially doubling
the
Federal
tax subsidy
for
each
of
the
two
bond issues.
We object to both the special relief character of the
provision,
and
to
the
increased
Federal
tax
subsidy,
which would
have a paygo impact.
We note that the comparable bonding provision
in H.R.
3634
does
not contain the defeasance provision of
section
704
of
H.R.
3761.
We
recommend that
section
704
of
title
VII
be
omitted.
Title VIII
Commission on the Economic Future of
the Virgin Islands
Title
VIII
would
establish
a
six-member
commission
to
evaluate
future economic options for the Virgin Islands.
One concern is the
possibility that United States restriction on American tourism to
Cuba will eventually be
lifted.
A re-opening of American tourism
to Cuba would result
in stiff competition
for the Virgin Islands'
tourism industry.
The Administration supports
the objective
of
title VIII,
which
is
to
analyze
and plan
for
the
future
economic
needs
of
the
Virgin
Islands.
The thrust of Administration policy on good government
is
generally against
the creation of new commissions.
66
Also,
there
is
a question of timing and funds.
We believe that
it
would
be
difficult,
if
not
impossible,
to establish
a
commission
and produce
the
desired
recommendations
by
the
December
31,
1997
deadline provided
in
the
bill.
Alternatively,
we
recommend
that
the Office
of
Insular Affairs and Governor Schneider explore
the
possibilities
of
an agreement
for technical assistance
to achieve
the purposes of title VIII.
We believe that this approach would be
faster,
less expensive,
and could utilize available funds.
We look
forward to working with interested members of Congress and Governor
Schneider
regarding
the
development
of
a plan
of
action
for
this
important
effort.
Mr.
Chairman,
we
applaud
the
diligence
of
your
subcommittee
in
examining
insular
issues.
We
look
forward
to
enactment
of
legislation that will benefit
the
islands.
Attachment
SEC.
502
COVENANT AMENDMENT.
In the second sentence of subsection
(a)
of section 703
of the
Northern Mariana Islands Covenant contained in section
1 of Public
Law
94-241,
strike
the
words
"of
the
Government
of
the
Northern
Mariana
Islands".
68
INCLUDED IN THE OVERSIGHT PLAN
OF THE COMMITTEE ON RESOURCES
Approved February 8, 1995
DISPOSAL OF WATER ISLAND IN THE VIRGIN ISLANDS
The fourth largest island in the Virgin Islands was leased by the
Department of the Interior to an individual in 1951, who subleased
parcels. The lease expired in 1991 and the Bush Administration
consummated agreements of sale with the various homeowners. The
Clinton Administration has sought to renegotiate the agreements of sale,
incurring considerable time and expense to all parties. The
Subcommittee views Water Island as one more example of residual
matters which should have been resolved by the Department years ago
and warrants Federal oversight to bring matter to closure.
69
70
Written Statement of
A.
P.
LUTALI
Before the
HOUSE COMMITTEE ON RESOURCES
SUBCOMMITTEE ON NATIVE AMERICAN AND INSULAR AFFAIRS
On H.R.
3721
THE OMNIBUS TERRITORIES ACT OF
199 6
July
24,
1996
Mr.
Chairman and Members of the Subcommittee:
I am pleased to have the opportunity to submit this written
statement
in support of Titles
II,
III,
and V of H.R.
3721,
the
Omnibus Territories Act of
1996,
which pertain to American Samoa.
T regret that prior commitments prevent me from testifying
in
person at the hearing,
and
I ask that this statement be placed
in
the hearing record as the official position of the American Samoa
Government
I commend Delegate Eni
F.
H.
Faleomavaega for introducing
the Omnibus Territories Act,
which contains several
initiatives
of potential benefit to our
islands.
I also want to thank
Chairman Elton Gallegly for scheduling this hearing so that the
Subcommittee can focus on the present and future needs of
American Samoa.
In general,
the American Samoa Government supports Titles
II,
III,
and V of the proposed Omnibus Territories Act,
all of
which are directed at our territory.
In this statement,
we will
explain the reasons
for our support and will offer some modest
suggestions for improvement of the bill.
TITLE
II
AMERICAN SAMOA STUDY COMMISSION ACT
Title
II
of the bill would create the American Samoa Study
Commission,
consisting of three members appointed by the
Secretary of the Interior and two members appointed respectively
by the Speaker of the U.S.
House of Representatives and the
President of the U.S.
Senate.
Two of the members appointed by
the Secretary of the Interior would be selected from among
candidates nominated respectively by the Governor and Legislature
of American Samoa.
The Commission would be directed to study and report on the
historical and legal basis of American Samoa's relationship with
the United States and to make recommendations on options
for
future political status.
Public hearings would be held on each
71
of our major islands and at three locations
in the United States
where significant niunbers of American Samoans reside.
The
Commission would submit a report to the President and the
Congress containing
its findings,
conclusions,
and
recommendations
We believe the work of the Commission would advance the
understanding of our political history and our options
for the
future,
both among our own people and among policymakers
in the
Federal Government.
The Commission's efforts would benefit from
the conduct of
local public hearings
in our
islands and
in the
American Samoan communities
in the United States.
The
composition of the Commission
is properly balanced to reflect
both local and federal
interests.
As we interpret Title
II,
the conclusions and
recommendations of the Commission would be entirely advisory and
would not be binding on American Samoa or on the Federal
Government.
To avoid any misunderstanding,
we suggest that the
non-binding character
of the Commission's report be expressly
stated
in the text of the bill or
in the Committee report which
accompanies the bill.
TITLE III
AMERICAN SAMOA ECONOMIC DEVELOPMENT ACT
Title III of the bill would authorize the appropriation
through the Secretary of the Interior of $10 million per year
over a six-year period
for the construction and repair of capital
assets of American Samoa.
We support this much-needed authority
for
a multi-year program to address the growing infrastructure
deficiency
in our
islands.
To make Title
III even more
effective,
we suggest extending the effort to ten years by
authorizing the appropriation of $10 million per year through
fiscal year
1997.
The construction and repair effort envisioned by Title
III
is consistent with my recent letter to President Clinton
proposing
a major Rehabilitation Program for American Samoa.
Such
a program
is overdue because our islands are suffering from
a decade of relative neglect by the United States.
Over the past
ten years,
annual U.S.
appropriations have steadily declined
while our population has doubled and our needs for basic
facilities have multiplied.
The decline
in U.S.
support has been exacerbated by three
devastating hurricanes
in the short span of eight years.
These
storms,
each more destructive than any
in the preceding
100
years,
literally flattened our islands three times.
Our
hospital,
school buildings,
and road system were severely
damaged,
and many essential facilities have not been adequately
repaired or rebuilt.
-
2
-
72
A ten-year program of construction and repair would address
current needs while laying
a foundation for greater self-
sufficiency
in the future.
We are pleased to report that
a new
garment manufacturing project has recently begun production
in
American Samoa,
providing more than
4 00 new jobs
in the local
economy.
This represents the first new major export industry in
our territory since the 1960 's.
The multi-year development
program contemplated by Title
III
of the bill could provide the
basic modern infrastructure necessary to attract and sustain more
private industry
in American Samoa.
TITLE V
AMERICAN SAMOA CAPITAL INFRASTRUCTURE FUND
Title V of the bill clarifies that funds provided to the
insular areas from the Capital Infrastructure Fund will
be
considered to be local revenues when used as the
local share
required to obtain federal programs and services.
In the FY96
Interior Appropriation,
Congress created the multi-year Capital
Infrastructure Fund for the insular areas by redirecting funds
previously appropriated for another purpose.
The redirected
funds had been eligible to serve as the
local share for federal
matching requirements,
but this matching eligibility was not
specifically carried over to the Capital
Infrastructure
Fund.
The clarification
in Title V will maximize the ability to
develop necessary infrastructure with the limited amounts
available from the Capital Infrastructure Fund.
It appears that
the clarification
is consistent with the original congressional
intent.
In this regard,
we understand that the Senate Committee
on Appropriations has
included
a similar clarification
in
its
version of the Interior Appropriation bill for FY97
(H.R.
3662)
CONCLUSION
In conclusion,
I want to restate our support for Titles
II,
III,
and V of H.R.
3721 and our appreciation to Delegate
Faleomavaega and Chairman Gallegly for their interest and for
their efforts.
We respectfully urge the Subcommittee to approve
these titles and to give favorable consideration to the modest
improvements which we have proposed.
-
3
-
73
SUPPLEMENTARY SHEET
House Committee on Resources
Subcommittee on Native American
& Insular Affairs
H.R.
3721
Omnibus Territories Act of
1996
July 24,
1996
Witness:
Honorable A.
P.
Lutali
Governor of American Samoa
Address
Office of the Governor
Pago Pago,
American Samoa
96799
Telephone:
011-684-633-4116
Fax:
011-684-633-2269
Topical Outline;
1.
The American Samoa Study Commission Act
(Title
II)
should be adopted with suggested clarification.
2.
The American Samoa Economic Development Act of
1995
(Title
III)
should be adopted with suggested extension.
3.
The American Samoa Capital Infrastructure Fund
(Title
V)
should be adopted as clarification of congressional
intent.
74
TESTIMONV
BEFORE THE HOUSE OF REPRESENTRTIUES
SUBCOMMIHEE ON NRTIUE RMERICRN
f> INSULRR RFFRIRS
7/24/96
BV
SENATOR ELIZHBETH BHRREn-flNDERSON
23RD GUAM LEGISLHTURE
Mr. Chairman and Members of the Committee:
Hafa Rdai and Good flfternoon!
I appear before
this Committee
to testify on Resolution #433,
as unanimously adopted by
the 23rd
Guam
Legislature
requesting
a
Congressional
amendment
to
the
Organic
Ret
of Guam
authorizing the Territory
to
elect
its Attorney
General. Rttached to this testimony is a section by section analysis for
use by the Committee.
May
I
begin
by
thanking
the
Committee
for
scheduling
Resolution #433 for public hearing. The Guam Legislature recognizes
the tremendous workload of the Subcommittee. IDe greatly appreciate
the Subcommittee's early attention.
The
Rttorney
General
of Guam
is
a
position
created
by
local
statute (5 Guam Code Annotated §30101), appointed by the Gouernor
and confirmed by the Guam Legislature. The Attorney General
is
the
head of the Department of Lam hauing jurisdiction ouer both
ciuil and
criminal prosecution, and
is the chief legal officer to the gouernment
of Guam.
It
is a cabinet leuel position, the head of an eKecutiue
line
agency, and functions completely under the puruieuj of the Gouernor
of Guam in accordance mith the Gouernor's Organic Ret authority ouer
all line agencies in the gouernment of Guam. (48 U.S.C. §1421)
lUhy an elected Rttorney General? Empomering the people of the
Territory
to
elect
their Attorney General
is
a statement
of greater
self-gouernment on the part of the people of Guam. Self-gouernment
IS not just a concept inuolued
in a political status change.
It can be a
75
realistic eKpression of a people to decide through the power of uoting
houi
it seeks to gouern itself. Uoting for the chief legal officer of the
Territorg
is
a
realistic
step
toiuard
the
goal
of
greater
self-
gouernment in much the same manner that uoting for the Gouernor is
an expression of self-gouernment.
Electing an Rttorneg General is not
an unrealistic concept
which seeks
to create new legal theories
of
self-gouernment rather,
it
is a concept that
is steep
in
legal historg
euoluing from English Rule where the Rttorneg General was appointed
bg the King, to the Jacksonian Era which established the rule of direct
election
of
state
officials.
Today
46
states
elect
their
Rttorneg
General under constitutional guidelines.
The people
of Guam expect
their Rttorneg
General
to
protect
their
interest
aboue
all
else.
Rn
appointed
Rttorneg
General,
unfortunateig, must respond to a great extent to the concerns of the
Gouernor.
The Rttorneg General of Guam has historically suffered from this
dilemma.
The
people
of Guam
are
franklg
tired
of
the
constant
criticisms focused on the uery position which the people demand the
highest degree of legal integrity.
Rs Rttorneg General of Guam from 1987
to
1994,
I serued
in an
appointed
capacity.
No
better
example
of
a
conflict
of
interest
between an appointed Rttorney
General, and
the Gouernor of Guam
can be illustrated than the enactment by Gouernor Joseph
F. Rda of
the anti-abortion law ouer my stern aduice and
official Opinion that
the legislation was unconstitutional under Roe. Rs an elected Rttorneg
General
I would not haue hesitated to immediateig sue the Gouernor
to enjoin the law. Rs an appointed Rttorneg General
I was placed in an
unbearable
conflict.
The law fortunately was quickly challenge
in
a
1983
Jane Doe law suit. The Rttorney General's Office was conflicted
from
representing
the
Gouernor
based
upon
mg
Opinion,
and
therefore, outside counsel was
hired
to defend
the
Gouernor. Two
years later the Court of Rppeals for the Ninth Circuit held the law was
unconstitutional.
The
gouernment
was
ordered
to
pay
treble
attorneys fees
to the plaintiff's counsel. The people of Guam should
not be expected
to pay
for both the challenge and defense
of any
litigation so clearly unconstitutional on
its face. Rn elected Rttorney
General would assure that such a case does not reoccur.
Finally, a companion measure,
Bill #571, introduced by Senator
Uincente
C. Pangelinan, proposes
to
enact
a
statute
calling
for an
76
elected
flttorney General upon amendment
of the
Organic
Ret.
This
measure has been reported out fauorably
to pass by the Committee
on Judiciary, Criminal Justice & Enuironmental
Rffairs. Each of these
pieces of legislation is an unequiuocal statement of bipartisan support
for
an
elected
Rttorney
General.
Rttached
to
this
testimony
are
articles and news releases also suggesting strong community support.
UJe urge the Subcommittee to reuieui carefully Resolution #433,
and considered its ouerujhelming benefit to the Territory's grouith and
self-gouernment. This
is a "can-do" issue for the people of Guam.
Respectfully submitted
ELIZRBETH BRRREn-RNDERSON
Rttachments:
77
SECTION
BV SECTION
SECTION
1.
^
^^
^
§1422.
This Section of the Organic Ret establishes the
'Constitutional
positions
luithin
the
Executiue
Branch.
The
amendment
adds
the
position of Attorney General
to that
of the Gouernor and Lieutenant
Gouernor.
It
establishes
the
qualifications
for anyone
seeking
the
position
of
Attorney
General.
It
further
exempts
the
Attorney
General's Office from budgetary management of the Gouernor, mhich
is important to preserue among co-equal elected offices. The Section
specifically creates the Office of the Attorney General, administered
by an elected Attorney
General, and
further delineates
the powers
and duties of that position.
The Guam Legislature specifically amended the Resolution during
debate on
the
floor
to
clearly
and
unequiuocally
prouide
that
the
position
be
elected.
This
ujas
done
for
seueral
reasons:
to
auoid
potential litigation as to the intent of Congress
to create
a co-equal
executiue branch position, and to preuent future legislatiue repeal.
The Section prouides for an impeachment process by referendum
in the same manner as the Gouernor and Lieutenant Gouernor.
It also
prouides for filing of a uacancy
in the position due to a temporary or
permanent absence of the incumbent.
§1422(c).
This
is one of the most
critical prouisions dealing
uiith the
Gouernor's
poiuer ouer
the
Executiue
Branch.
It
is
also
the
most
litigated
prouision
of
the
Organic
Act.
Resolution
#433
adds
an
amendment to the sentence dealing uiith the establishment of a merit
system for the gouernment of Guam. In Haeuser u. Oeoartment of Law
(Court of Appeals for the Ninth Circuit
C.A. 94-16987; argued May
9,
1996) the Court of Appeals questioned the gouernment regarding the
intent
of
Congress
in
adopting
that
certain
phrase
"as
far
as
practicable"
in reference
to
the
creation
of
a merit system by
the
local Legislature.
It is not unusual that the term "as far as practical"
as
opposed
to
"as
far
as
practicable "
is
used
in
Congressional
drafting. There being no
legislatiue history regarding
the
intent
of
Congress in the use of the term,
it mas left to the parties to refer to
4
78
old case law. The Court has not yet rendered
its decision, houieuer,
it
mould not be inappropriate
for Congress
to better
clarify
that
the
Legislature be empoujered
to create
a merit system gouerning
the
selection,
appointment
and
remoual
of employees
therein,
and
to
further create such other position(s)
not intended
to be
mithin
the
merit system. (Rppellant/Rppellee Briefs Ruatlable)
SECTION 2.
§1421 g(c). This Section repeals the authority to create an Office of the
Public Prosecutor.
It mas intended that
this section mould allom for
the creation of an elected Public Prosecutor.
The Section, homeuer,
did
not
specifically prouide
for election, and
it
conflicted
mith
the
Gouernor's
authority under §1422
ouer heads
of
all
agencies.
The
earlier amendments to prouide for an elected Rttorney General mith
jurisdiction
ouer
criminal
cases
moots
the
issue
of
a
Public
Prosecutor. The Public Prosecutor should therefore be repealed.
79
PACincBDNDAlf NEW§,A,^ „, ism
Guam voteiiilre ready to
pick an attorrley general
By BEN C. PANGEUNAN
We h»v« passed the milepoata of an''
elected Ii%idatut« in the eai^ %08, tloctrt;-
od gDvemorin the 70s and the most n»-
°
cent mile ;naiker we have oooio upcm i»
the appointinont of our own .Suprente
'
ConrtjuBtioea.
The next niilcpost on the horizon is the
cKtabliehmenl ofan doctcd attorney gen-
eral aa a 'constitutional position* within
tho territory. Tljew! aro not new paths,
but nitbcr trails that Iiave been blazed by
other juriBdictions as they traveled the
road to political maturity.
Political maturity can be best described
ai! tho empowerment ofthe electorate to
hold ila leaders directly accountable. An
elected attorney general does not moan
the absence ofpolitics from the adection
process, but rather that tho politics and
the selection process are directly con-
trolled by the people via the ballot box. I
bolicve uiat ttie electorate of Guam is
equipped, rcspansibJc and mature enough
to exercise this power in deciding their
own attorney general.
Across our nation, 43 gftita havo vest-
ed tlus power directly with the voters. Of
tlH> rcmaininfi seven slatcn, Tennessee's
is appointed ^.thc State Supreme Court
and Maine's is' selected by the Legisla-
turs, lite rest, including Alaska, Hawaii,
iWyoming, Now Jersey, New Hampshire
; amiall ofIho flag territories and the Dis-
trict ofColumbia, have attomeyeraieralB
appoiittod.faK their govcmore. Qraddne
tnemilepoctson tlie pilgrimage road to
poliLical maturity, it is worth noUng tliat
.those slatc.^ and all of the territories
.where internal self-government is a re-
cent phenomona, have not rel^ated the
power to determine the attorney gener-
ela to their electorates.
.Guam and ila vui*mi are prepared to
break out oftliis pack. Ilie attorney gen-
eral must represent the common good
and public interest.
The inbttdaction of Bill No. 571 is not
the final step, but an emphatic advance-
ment toward full political maturity. It
serves to refresh us on our journey until
wo can come upon tho uttimote oasis of
democracy of self-determination. To-
:gether wiUi the efTorts of Congressman
Underwood in Congress to intixiduoc and
vigMOualy lobl^ for tlie amendatory mea-
sure, I believe tlial lime is fast ap-
proaaiing Mdtcn wo will bo dble to dedde
upon a popular attorney general.
Sen. Ben C Pai^dinan is nimember
ofthe 23nl Guam Legislature.
Loyalty Is not to a person
By JESS E. EI^ER
Whether or not tho attorney general
is popularly elected or appointeaby the
govexnor, U)c position is expected to serve
the government, not necessarily work for
the porsonal interest of the governor.
Hie Judiciary Act of 1789, whidi cre-
ated the position of the Attorney Gener-
al (AG) of the United States, defines Uiis
positaon as the chieflaw ofiflccr ofthe gov-
ernment. He is appointed by the presi-
dent sulyect to confimiation by a screen-
ing le^slative body. Duties are to advise
and rsiHesent the government in impor-
tant 1^1 matters and to initiate and su-
pervise legal proctodings that affect the
wel&re ofthe nation. The position ofAG
was later made applicable to states and
terrilories at wliicli Icvcln the position
may eiUier be appointive or elective.
Patterned after the taskx of the AG of
liie U.S., tlic attorney general of any
r.tate, or territory, wlicUinr elected or ap-
pointed, serves ne tlic chief law officer wf
the gnvcrnmenl. In Guam he is tlie head
t)^\}if Iifiw r)eivirtinoi\<. Ah .nicli, ho is.
like all other department heads, ap-
ixnnted by the governor, subject to con-
firmation by the Icgiidaturc.
Whether or not the AG, or any public
official for that matter, is elected or ap-
pointed docs not matter much. Ifheknows
nis job, he should be able to prove to any-
body aroimd him that his loyal^ whUe
poifimning bis tasks as a prdcssional is
owed not to any particular person but to
the government in gcTicrvl. And the gov-
orament siKMid always serve the inUstaA
ofth^ greater number ofthe people, for tJie
greater number ofthe people, and by the
greater munber of the people.
A vigflant citizenry cw> steer the AG's
porforinance' the way it should be even if
he is appoii.tod by tho envcmor. Piahaps
wo c-an Bhve Congrrs.s precious time fiji
more urgent lemslation ifwo leave (his is
Buc as is ond anin\- that we in Guam aix-
capable of self-governinj; within (}».
fi-Wicwork of the Origanic Act
Jess E. Bdejer in a flnamx' cutUroUn
fiom Moufiitiit
80
•April I4yl$9li
A^xmxism ~n
Provides a check and baldnce
By ELJZABETWBAWHErr-AMDERSON
'llic 1 977 Guam Con-sUiutional
Convcnti(in reooinmondod Guam's
C"k>nsUUilJon Khould provide for nn
clcded attorney general:
"Soclion 6. Attorney General.^
The attorney general shall bo a
qualified voter of Guam, a bona
fide resident of Guam (or at least
two years immediately preceding
the dale of taking office, and
li-
censed to practice law before the
SuprRfiie Court of Guam. The at -
tomey general shall tie elected at
a regular general election on a
non -partisan ballot and shall sorvo
(or a term of four years or until a
successor is eieded and quafifled."
Guam'ti ronstitution was nev-
er ratifiod or adopted by the peo-
ple, instead in 1984 we optod to
negotiate for a political Matua
rhange. Commonwealth.
\Vl)ile the OommifoionAn Self-
Determination cbniintlos its,
qttc&t, I am a firm bcUcvcr that we
sliould Etrivo to attain those bit«'
and pieces ofen^jiter Belf-govcrn-
moDt in oi<y mjinncr Uiat we nin.
Amend f hr Of);;inic Act to a»ilhn
COMMENT
n7jc the ptxjple ofGuam to dect an
attorney general is "^doable," and
an easily undorBtoud concept oi
most states whicii elect their own
attorney general.
Tlie etrcngth of a good attor-
ney general Ls not dependent, on
wliether he or she is appointed or
elected. So what ia thebenefit of
an elected attorney general? 1 be-
lieve it is in the ability of that
person to become a real advocate
for Uie people.
..
.
•
-
In instances where a state
agency may oxcecd it« autltority,
or act outside the scope of the
law, elected attorneys general
have resorted to litigation lo hall
nnauthorisKid action by tlie state
aguncy. Indeed, in my tnnurc as
attorni-y general of Guam,
I
worked with several state atlor-
noy» general wlio were cnihroilcd
in liligaiion against
sl.'il<<. agen-
ciea Uiey normally would be rep-
resenting, and in some eaacn di-
reclJy sgi^nst their govcsrnor.s.
An clcdcd attorney geiiend pni
vjdcs cm '^tcmal^dtock and bal-
ance in the adthlnistration ofUie
executive branch ofgovernment,
Whoji the attorney general and
the governor do not see eyo to
eye, there is :no avoiding a show
down. An appointed attorney gen-
eral stands in a precarious posi-
tion; sticking to bia^icr guns >ri|]
inevitably moan loss of a job. An
elected attorney gencrjil (Iocs not
face tlie potential of uncmploy-
mcnt until Uie next election.
In working for Bcven and a half
years with many state atlomeys
general, I came to the belief ear-
ly on tliat Guam was politically
ready for an elected attorney gen-
eral. Someone who has the
strength and fortitude to take fin
the legal challenges and prob-
lems that affect our island, and
to dn so with fietxx! dedication.
As an apjiointod attorney gen-
eral, 1 was not in a po.sition to
espoiLsc tluB view, a.s a senator 1
am in a position tu make a dif-
ference for Guam.
SvfU Eluabeth liarnU-An
dfison M n aauttor in tlie 23rd
Guam l^nixloturc
81
Should we push to elect
^auam's attorney general
Recent c«ntn,vcrsy over political h.. ^
^'^^Wl.
.» inao.d'ss.^r^te' ff»"i" ""i^.~cr'.,".Zir"Sr^
PACIfK; daily news. Friday, Junf 28. IfKlT.
Senator urges election of Guam AG
Organic Act;
Amcridment spoasored
by Sen
Bai ret! -Ander-
son sent to Washington
By bERNADETTE STERNE
ntf^AteiM Staff
Onr thl.tnd Bnnator wunO: (y
clianpn ihc Orfjjinic Art HO.rrsi-
dciil£ wodiri ricrf Ouam'a ft1.tor-
ncy c,cnvrii\.
Sen Kli^^AbcOi B:uTcU-At»Hcr
Mtfi ftiKmsornd m rrsolulirm whidr
paHArd t-nrlicr Uiib month (u
unicnd ihc Orfianic Ad ofGunn)
1-0 iiTovidc for
i»n rJcctod uttnr-
t^uatn iv rMidy, imJ itifKibk' nf
eJrclirip iU ov.ii ji'tomov pcnct-
al.** iJic Cliftl-ni r«(:<A')idnl ic-
fntltlirAn sun^-
1 nm
if
;iK H htnUhy r.U-p to-
wftrri scIf-govTtTirn<'»l (o olrd art
ntioniry Rrncral who would Iw
unswprnblc l/iOir pi-oiilc"
Bari«tlA»»dcrt>on
ia a former
altomoy goncmi who war ap-
pointrd to tluil pmiljon by for-
nwT f»ov. Jo3«^th Adn
The uenntor sent ihc Organic
Ad nmendmvnlK to ))r1
l<al>crl
A Underwood, ho|»ing lo hnvc
the nmcndmunt* mdoHrd in hills
Umt would pivc Cuam firei c)nim
lo nny trHnsiti orc3i<t-«y; milHniy
tin>|icriy, (Uic (»{d.
Underwood told Ihn baitv
it see
It as a healthy step toward self -govern
I ment lo elect an attorney general who would
be answerable to the people.*
— SEN. EUZABETH BARRETT-ANDERSON
News in a Iclcphono interview
yoKtcrdRy that he Jociti't think
Bnrrett-Andc-TTmn'e omciKlnicnfK
will nutkc it lo the Roor.
And, Underwood said, he
would |ikctodlf;ctiHi;Uicamend-
mcnla with Gov Onrl GuUcrr**?.
and Guom'B Judicial Oiutiril be
fore taking any ndJon.
*l woillonX KTc any uhjcctiun
(o H from my part, but 1 jaet want
to mnke Burc that
I Rcctin) Uic
opinion of all Uie ntovinf^ |inrta, 60
to epnak," Underwood Kaid.
Borrctt-Aiidcr^nn said she
hupcK that amcndmc-nU will U:
nddrovacd before U>o end ol UiiK
Congress, or maybe (ho next.
1 don't think tlterc is .1 great
rtiah to do it right »ow«" she tnid.
82
TWENn-THlRD GUAM LEGISLATURE
1 996 (SECOND) Regular Session
Bill No. £It
Introduced by:
V. C. Parjgelinan ^^''^^
J. Won Pat-Borja^
M.C. Ci lai fauj o»;^55S-'
F. Cannschd^
H.A. Cristobaji^^
L. Leon Guerrero <w*^
A. Sontos C^^^
AN
ACT
TO
REPEAL
AND
REENACT
SECTION
30101,
TITLE
5
GCA
RELATIVE
TO
CREATING
AN
EteCTlVE
ATTORNEY
GENERAL POSITION.
1
BE IT ENACTED BY THE PEOPLE OF THE TERRfTORY OF GUAM:
2
Section
1,
Legislative
Statement.
Section 1422C,
Title 48 U.S.
3
Code Annotated, as amended grams the territory of Guam the authority to
4
provide
by
law
the manner
of
appointment
of heads
of
the
executive
5
agencies
and
Instrumentalities.
This mandate
is
a
recognition
by
the
6
United States Congress of the
political maturity of the people of Guam and
7
their proven ability to manage the affairs of the territorial government.
8
The
Legislature further finds that the Attorney General, as head of
9
the
Department
of Law,
has
a
unique and nnorrnous
responsibility.
All
10
agencies and Instrumentalities
of government frequently request the legal
11
opinion
of the Attorney General
to use
that
as
a
guideline
for
official
12
actions.
This legal opinion has at times been deemed the force and effect
13
of law
until otherv>«se reversed by the Court of competent Jurisdiction
in
14
^n appropriate legal action.
15
Because of the nature of the responsibility of the Attorney Gener'al,
lb
It
is
necessary
to
relieve
him
or
her from
any
pressure
that may be
\1
' imposed
by
the
appointing
authority,
by
institutionalizing
the
post
of
18
Attorney General as an elected position to bett serve the Interest of the
19
territory and the people of Guam
83
1
Section
2.
5 GCA §30101
is
hereby
repealed
and
reenacted
2
to read:
3
"Section
30101.
Attorney
(ieneral.
The Department
of Law
of
the
4
government
of Guam
shall be
administered by
the Attorney
General
of
5
Guam, who shall be elected at the same time and manner as the Governor
6
and
Lieutenant, and
his term of office
shall be the same
as
that
of
the
7
Governor.
The term of
office
of
the incumbent
holder
shall
expire co-
8
terminous
with
the
term
of
office
of
the
Governor
unless
sooner
9
terminated."
84
TWENTY-THIRD GUAM LEGISLATURE
1996 (SECOND) Regular Session
Resolution No. 433 (LS)
*
Introduced by:
E. Barrett-Anderson
J. P. Aguon
T. C. Ada
A. C. Blaz
J. M. S. Brown
F. P. Carnacho
M. C. Charfauros
H. A. Cristobal
M. Forbes
A. C. Lamorena V
C. Leon Guerrero
L. Leon Guerrero
T. S. Nelson
S. L. Orsrni
V. C. Pangelinan
D. Parkinson
J, T. San Agustin
A. L. G. Santos
F. E. Santos
A. R. Unpingco
J. Won Pat-Borja
Relative to requesting Congressman Robert Underwood to
introduce a measure before Congress relative to the Office
Of The 'vttnmey General by an^^^-^ding Sections §'l421g(C),
;ji+
Alt.'
-r
-1*
/•ru
§141:2u,
ui 1\
e
-^t ihe
Lr.ited
States Code, the Organic Act of Guam.
1
BE IT RESOLVED BY THE LEGISLATURE OF THE TERRITORY OF
2
GUAM:
85
1
WHEREAS, presently the Attorney General of Guam is an executive
2
branch agency head appointed by the Governor of the Territory in accordance
3
with local statutory authority
creating the Department of Law, a line agency
4
of the goverrunent of Guam (5 Guam Code Annotated §30101); and
5
WHEREAS, the Twenty-Third Guam Legislature finds that
in an effort
6
to attain greater self-govermnent, and to provide for a check and balance
7
within the Executive Branch, the Territory should establish the post of an
8
elected Attorney General; and
9
WHEREAS, the Orgaruc Act of Guam, which does not presently provide
10
the government of Guam authority to establish an elected Attorney General,
11
would
in
effect cause an automatic
repeal
of any
local law enacted
12
inconsistent with the Organic Act; and
13
WHEREAS, historically Guam has recognized the need
to create a
14
constitutional office of the Attorney General, and to have that office elected
15
(1977 Guemi Constitutional Convention, at §6 "Attorney General", Guam
16
Draft Constitution); and
17
WHEREAS, as the Commission on Self-Determination continues
its
18
quest for greater self-government,
it would be consistent with such concept
19
to allow the people of the Territory to determine the irumner and process for
20
selection of its Attorney General, to include elective office; now, therefore, be
21
it
22
RESOT VED, bv
the Twentv-Third Guam LpRislature,
that Guam's
23
Delegate to Congress, Congressnidii Robert UnUerwoua
is re4uested
to
24
petition the United States Congress to expeditiously amend the Organic Act
25
of Guam to provide for the creation of the position of Attorney General, and
26
to grant the people of the Territory of Guam authority to determine the
27
maimer of selection of the position of Attorney General.
>""
'
2
86
1
To that end, the foUowing amendments to the Organic Act of Guam are
2
hereby requested:
3
Section
1. Section 1422 of Title 48 United States Code is amended to
4
read:
5
'§1422.
Governor;
Lieutenant Governor; Attorney
General: Powers,
6
duties.
The executive power of Guam
shall be vested
in [an executive
officer
7
whose official
title shall be the "Governor of Guam. "]
a governor,
lieutenant
8
governor and an
attorney general.
The Governor of Guam, together with
9
the Lieutenant Governor,
shall
be elected by a
majority of the
votes
cast by
10
the people who
are
qualified
to
vote for
the members
of the
Legislature of
11
Guam.
The Governor and Lieutenant Governor jointly
shall be chosen by
the
12
casting
by
each
voter
of a
single
vote
applicable
to
both
offices.
If no
13
candidate
receives
a
majority
of
the
votes
cast
in
any
election,
on
the
14
fourteenth
day
thereafter
a
runoff
election
shall
be
held
between
the
15
candidates for Governor and Lieutenant Governor
receiving
the
highest and
16
second
highest number
of votes
cast.
The first
election for Governor and
17
Lieutenant
Governor
shall
be
held
on
November
3,
1970.
Thereafter,
18
beginning with
the year 1974,
the Governor and Lieutenant Governor shall be
19
elected
every
four
years
at
the
general
election.
The
Governor
and
20
Lieutenant Governor shall hold
office for a term of four years and
until
their
21
successors are elected and
qualified.
22
hlo person whn hr-
^t-en
elected Governor for tvo
full successive terms
23
jliul:
ty^iu vc digiuh
10 nolu
ttiui
uj/tce until one full term huj intervened.
24
The
term
of
the
elected
Governor
and
Lieutenant
Governor
shall
25
commence on
the first Monday
in January following the date of election.
26
No person
shall
be
eligible for
election
to
the
office of Governor,
[or]
27
Lieutenant Governor or Attorney General unless he
is an
eligible voter and
3
87
1
has
been for five
consecutive
years
immediately
preceding
the
election
a
2
citizen
of the United States and a bona fide resident of Guam and will
be, at
3
the time of taking
office, at
least
thirty years of age,
<^vd in
the
cffgf of the
4
pffir/. nf the AttnrttP^ General ha^ been admitted tO vrdCtiC^ MCT? the
5
«;„^Pt,.^ Cnurt of Gunn, and in vood standing (ft thf time of hi? ek^Qn .
6
The
Governor
shall
have
general
supervision and
control
of
all
the
7
departments,
bureaus,
agencies, and
other
instrumentalities of the executive
8
branch of the government of Guam, with the excer*i<*n of the
offi<^e of the
9
Atfnm»^ Genernl 7„hirh -ihall ho independent from the general supervision qf
10
ti'"
nnvernor .
He may grant pardons and
reprieves and
remit fines and
11
forfeitures for
offenses
against
local
laws.
He may
veto any
legislation
as
12
provided
in
this
chapter.
He shall appoint, and may remove,
all
officers and
13
employees
of the
executive
branch
of
the government
of Guam,
except
as
14
otherwise provided
in
this or any other Act of Congress, or under the laws of
15
Guam, and shall commission
all officers he may be authorized
to appoint.
He
16
shall
be responsible for
the faithful execution
of the laws
of Guam and
the
17
laws
of
the
United
States
applicable
in
Guam.
Whenever
it
becomes
18
necessary,
in case of disaster, invasion, insurrection, or rebellion, or imminent
19
danger
thereof
or
to prevent
or suppress
lawless
violence,
he may summon
20
the posse comitatus
or
call
out
the
militia
or
request
the
assistance
of the
21
senior military or naval commander of the Armed Forces of the United States
22
iv Cuam,
which p -
be given
at
the
discretion
of such
-nmmander
if not
23
aisruptive of
or
inconsistent
with,
hii, federal
responsibilities.
He may,
in
24
case of rebellion
or
invasion,
or imminent
danger
thereof when
the
public
25
safety requires
it, proclaim
the island, insofar as
it
is under the jurisdiction of
26
the government
of Guam,
to
be under
martial
law.
The members
of
the
88
1
Legislature
shall
meet forthwith
on
their own
initiative and
may,
by
two-
2
thirds
vote,
revoke such
proclamation.
3
The Governor
shall prepare,
publish, and submit
to
the Congress and
4'
the
Secretary
of
the
Interior
a
comprehensive
annual financial
report
in
5
conformance
with
the
standards
of the
National
Council
on
Governmental
6
Accounting within one hundred and twenty days
after the
close of the fiscal
7
year.
The comprehensive annual financial report shall include statistical data
8
as
set forth
in
the
standards
of
the
National
Council
on
Governmental
9
Accounting
relating
to
the
physical,
economic,
social
and
political
10
characteristics
of
the government, and any
other
information
required
by
11
Congress.
The Governor
shall
transmit
the comprehensive annual financial
12
report
to
the Inspector General of the Department of the
Interior who
shall
13
audit
it and
report
his findings
to Congress.
The Governor shall also make
14
such other reports at such other times as may be required by the
Congress or
15
under
applicable
Federal
law.
He
shall
also
submit
to
the
Congress,
the
16
Secretary
of
the
Interior,
and
the
cognizant
Federal
auditors
a
written
17
statement
of
actions
taken
or
contemplated
on
Federal
audit
18
recommendations
within
sixty
days
after
the
issuance
date
of
the
audit
19
report.
He shall have the power
to issue executive orders and regulations not
20
in
conflict
with
any
applicable
law.
He may
recommend
bills
to
the
21
Legislature and give expression
to his views on any matter before that body.
22
Ther"
is hereby
established
the
office of lieutenant Governor of Guam.
23
Inc
L^ieutcriant i^ovemor shah have Sucn execuuoe powers and perform such
24
duties
as may
be
assigned
to
him
by
the
Governor
or
prescribed
by
this
25
chapter or under the laws of Guam.
26
There
is hereby established the office of the Attorney General to be
27
administered by
the Attorney General of Guam who shall be elected
in
5
89
1
accordance with the amendments provided in Section 1422.
The Attorn^
2
gptteral shall he the chief lethal officer of the (government of Guam, shall be
3
vested with common law powers and such additional powers and duties a?.
4
may he prescribed under the laws of Guam, not inconsistent with this chdpt^,
5
The Attorney General shall prosecute all criminal violations of Guam law.
6
provide legal advice to the government, and represent the government in all
7
civil cases in which the government of Guam may be interested. The Attorney
8
General may not, while in
office, engage in the private practice of law or
9
actively engage in partisan politics or. within one year of ceasing to hold
10
office, run for nther elective office. Thp salary of the Attorney General shall
11
he established by law .
12
§1422a.
Initiative, Referendum and Removal
(a)
The people of Guam
13
shall
have
the
right
of
initiative
and
referendum,
to
be
exercised
under
14
conditions and procedures
specified
in
the laws of Guam.
15
(b)
Any Governor, Lieutenant Governor, Attorney General or member
16
of
the
Legislature
of Guam may
be
removed from
office
by
a
referendum
17
election
in which
at
least two-thirds of the number of persons voting for such
18
official
in
the
last
preceding
general
election
at
which
such
official
was
19
elected
vote
in favor
of a
recall and
in which
those
so
voting
constitute a
20
majority
of
all
those
participating
in
the
referendum
election.
The
21
referendum
election
shall
be
initiated by
the
Legislature
of Guam following
22
(a)
a
two iMris
vo^"
of
the
members
of
the
Legislature
in
fnvnr
of
a
23
referendum,
or
(b)
a
petition juf
^uch
u
referendum
to
the
Legislature by
24
registered
voters
equal
in number
to
at
least
50 per centum
of the whole
25
number of votes
cast
at
the
last general
election
at which such
official was
26
elected preceding the filing of the petition.
90
1
§U22b.
Vacancy
in
Office
of Governor
or
Lieutenant
Governor;
2
Temporary
Disability,
or Temporary Absence
of Governor,
(a)
Temporary
3
disability
or
temporary
absence
of Governor.
In
case
of
the
temporary
4
disability
or
temporary absence
of the
Governor,
the
Lieutenant
Governor
5
shall have
the powers of the Governor.
6
(b)
Permanent vacancy
in
office of Governor.
In
case of a permanent
7
vacancy
in
the
office of Governor,
arising by reason
of a
death,
resignation,
8
removal
by
recall,
or permanent
disability
of a
Governor-elect,
or for any
9
other
reason,
the
Lieutenant
Governor,
or
Lieutenant
Governor-elect
shall
10
become the Governor,
to hold office for the unexpired term and
until he or his
11
successor
shall
have
been
duly
elected and
qualified
at
the
next
regular
12
election for
Governor.
13
(c)
Temporary
disability or temporary absence of Lieutenant Governor.
14
In
case of the temporary
disability
or temporary absence of the
Lieutenant
15
Governor,
or during any period when
the Lieutenant Governor
is acting as
16
Governor,
the
Speaker
of
the Guam
Legislature
shall
act
as
Lieutenant
17
Governor.
18
(d)
Permanent vacancy
in
office of Lieutenant Governor.
In
case of a
19
permanent vacancy
in
the office of Lieutenant Governor, arising by reason of
20
the
death,
resignation,
or permanent
disability
of the Lieutenant
Governor,
21
or
because
the
Lieutenant
Governor
or
Lieutenant
Governor
elect
has
22
'^w'-e^ed
to
^hp
nffirp
of Governor
the
Governor
shall
ippoint
a
new
2j
..leuicriuni
Goven.u.,
uiith
lut auuiLt una
consent
of the
legislature,
to hold
24
office for the unexpired term and until he or his successor shall have been duly
25
elected and qualified at
the next regular election for Lieutenant Governor.
26
(e)
Temporary
disability
of temporary absence of both
Governor and
27
Lieutenant
Governor.
In
case
of
the
temporary
disability
or
temporary
7
91
\
/
^
1
absence
of both
the Governor and
Lieutenant
Governor,
the powers
of the
2
Governor shall be exercised, as Acting Governor, by such person as
the laws
3
of Guam may prescribe.
In case of a permanent vacancy in
the offices of both
4
the Governor and Lieutenant Governor,
the
office of Governor
shall
be filled
5
for the unexpired term
in
the manner prescribed by the laws of Guam.
6
(f)
Additional compensation.
No additional compensation
shall be paid
7
to any person acting as Governor or Lieutenant Governor who does not also
8
assume
the
office of Governor or Lieutenant Governor under
the provisions
9
of this
chapter.
10
(^) Vacancy in the office of Attorney General .
In case of the temyorani
11
difiahility or temporary absence or permanent absence of the Attorney
12
General which occurs beyond two (2) years from the incumbent's assumption
13
of office, the Legislature may determine the manner in which such vacancy is
14
filled. In case of a permanent vacancy occurring within two (2) years from the
15
incumbent's assumption of office, the Governor of Guam shall call a special
16
election to fill the remainder of the term of office of the Attorney General
17
§1422c.
Executive agencies and
instrumentalities,
(a)
Appointment of
18
heads;
merit
system.
The Governor
shall,
except
as
otherwise provided
in
19
this
chapter
or
the
laws
of Guam,
appoint,
by and
with
the
advice and
20
consent
of
the
Legislature,
all
heads
of
executive
agencies
and
21
instrumentalities. The Legislature
shall
establish
a merit system
[and, as far
22
a
p acticable, appo'v^tments
nt^'i
promotions
shall
''" made
in
accordance
23
with suUi mtrit systernj governing the selectio n, appointment and removai of
24
employees within the merit system.
The Legislature may also establish such
25
other positions in the government of Guam not within such merit system-
26
The Governor of Guam may by law
establish a
Civil
Service Commission
to
92
1
administer
the merit
system.
Members
of the Commission may
be removed
2
as provided by the laws of Guam.
3
(b)
Powers and duties of officers.
All
officers
shall have such powers
4
and duties as may be conferred or imposed upon them by law or by executive
5
regulation of the Governor not inconsistent with any law.
6
(c)
Reorganization.
The Governor
shall, from
time
to
time, examine
7
the
organization
of the
executive
branch
of the government
of Guam, and
8
shall
determine and
carry
out
such
changes
therein
as
are
necessary
to
9
promote
effective management and
to execute faithfully
the purposes of this
10
chapter and
the laws of Guam.
11
(d)
Continuation
in
office of incumbents.
All persons holding
office in
12
Guam on August
1, 1950 may, except as otherwise provided
in
this
chapter,
13
continue
to hold
their
respective
offices
until
their successors
are appointed
14
and
qualified.
15
§1422d.
Inspector General:
Functions; Duties,
(a)
Functions, powers,
16
duties
transferred.
The following functions,
powers, and
duties
heretofore
17
vested
in
the government comptroller for Guam
are hereby
transferred
to
the
18
Inspector General, Department of Interior, for
the purpose of establishing an
19
organization
which
will
maintain
a
satisfactory
level
of independent
audit
20
oversight of the government
of Guam:
21
(1)
The authority
to audit
all accounts pertaining
to the revenue
22
" "^
rpreipts
nf the
<^ove^nment
of Guam,
and
of funds
derived from
£j
mna
issues, and
tflc
auiHority
co
audii,
in
accor dunce
ujiih
law and
24
administrative
regulations,
all
expenditures
of funds
and
property
25
pertaining
to
the government
of Guam
including
those pertaining
to
26
trust funds held by the government of Guam.
93
1
(2)
The authority to report
to the Secretary of the Interior and the
2
Governor
of Guam
all failures
to
collect amounts
due
the
governor,
3
and expenditures of funds or uses of property which are irregular or not
4
pursuant
to
law.
5
Section
2.
Section
1421g(c)
of 48 United
States Code
is amended
to
6
read:
7
"§1421g(c)
[Office of the Public Prosecutor;]
Office of
Public Auditor.
8
The
government
of Guam
may
by
law
establish
an
[Office
of
Public
9
Prosecutor and]
Office of Public Auditor. The [Public Prosecutor and] Public
10
Auditor may be removed as provided by the laws of Guam.
"; and be
it further
11
RESOLVED, that the Speaker certify to and the Legislative Secretary
12
attest the adoption hereof and that copies be thereafter transmitted to the
13
Honorable Congressman Robert Underwood, Member
of Congress;
to
14
Congressman
Newt
Gingrich,
Speaker,
United
States
House
of
15
Representative;
to Senator Trent Lott, Assistant Majority Leader, United
16
States Senate;
to Senator Frank Murkowski, Chairperson, Senate Energy
17
and Natural Resources Committee; to Congressman Don Young, Chairman,
18
House Comnuttee on Resources; to Congressman Elton Gallegly, Chairman,
19
House Subcommittee on Nahve American and Insular Affairs; and to the
20
Governor of Guam.
DULY AND REGULARLY ADOPTED ON THE 8TH DAY OF JUNE, 1996.
DON PARKINSON
Speaker
10
27-245 0-96-4
94
Office of
^i»^mm,im,^m^„mmmmmmm^„^^mmmmmmm^mmmmmmm,^m^^m^mm
Senator Vicente C. Pangellnan
Twenty-ThirdGuam Legislature
Chaliman, Committee on Youth, Labor & Parks and Reoeatian
Tha
P
nrti
130 Atpinali Aveaue « Sulle 101 •Ag«naOuam« 96910 Phone (671) 472-3SS2-4 Pa»(671) 472-3556
TESTIMONY ON
RESOLUTION 433 OF THE GUAM LEGISLATURE
BEFORE THE SUBCOMMITTEE ON
NATIVE AMERICAN AND INSULAR AFFAIRS OF
THE COMMITTEE ON RESOURCES,
U.S. HOUSE OF REPRESENTATIVES
JULY 24, 1996
Honorable Chairperson and members of the Subcommittee on Native
American and
Insular
Affairs,
as
a member of the 23rd Guam
Legislature,
I
would
like to send a warm HSfa Adai and
a DSngkolo na
Si Yu'os Ma'Sse'
for
this
opportunity
to
present
testimony
on
Resolution 433
of
the Guam
Legislature and my proposed
Bill 571
which would provide
for an elected
Attorney General position on Guam.
The
political development
of
the
unincorporated
territory
of Guam,
in
its
present journey toward
self-determination,
has
undergone
a
series
of laborious processes to come to where we stand today,
to demonstrate
our
current
level
of
political
maturity.
As
a
precarious
creature
of
the
Congress,
however,
our
island and
our
people
have
not enjoyed
the
full
benefits
normally and
rightfully
entitled
to every American
citizen.
As
a
secondary
entity, we
have been and
still
are
often
forgotten
during the
decision-making
process and
in
its
resultant
policies.
Our achievements,
which
include
an
elected
Legislature
in
the
early
50's,
elected Governor
and
Delegate
to
the
Congress
in
the
70's,
and
most
recently,
the
appointment
of our own Supreme
Court
Justices,
have been
results
of
a
tedious process of persistent urging and lobbying by our dedicated leaders
over a prolonged period of time.
The
compilation
of
these
incremental
successes,
however
slight
they may seem to our fellow Americans
in the continent,
is nevertheless
a
giant step
for the
people
of Guam,
it
signifies
that
the Congress,
as
a
body,
has recognized the tenet which proclaims the
inalienable democratic
right
of
a
people
to govern themselves on
the matters that
affect them
directly.
No
longer must
nor
should Guam
be
subject
to
paternalistic
governance by the Organic Act.
Page
1 of 3
^5
I appear before you today
to convey the
unequivocal
desire
of
the
people
of Guam to elect
their Attorney General.
This expression ot
their
desire
is embodied
in Guam
Legislature
Resolution 433
and
a measure
1
introduced and now ready
for
floor action.
Bill
571.
The
direct selection
by the
will
of the
people of Guam
of the Attorney General
is
right,
just,
and
prudent
for
the
people
of Guam
to
have
an
independent
Attorney
General,
unfettered
by
incessant
political
intervention
from
a
single
individual.
The need and the
will of the people of Guam for an Attorney General
accountable
solely to the
public
is overwhelmingly evident.
Recent events
have
shocked
the Guam
populace
as
a
result
of
the Guam
Legislative
Judiciary Committee's oversight hearings on the Attorney General's
office
of Guam.
During
the
hearings
emerged
extremely
grave
concerns
of
whether
the
handpicked
Attorney
General
of
Guam
is
sufficiently
independent from
political
interference by the Governor.
Under subpoena,
as
most
employees
and members
of
the
public
alike
were
hesitant
to
testify
in
the
fear
of
reprisal,
many,
including
current
and
former
prosecutors and prominent private attorneys, informed the members of the
Legislature
that
there
exist
extensive
political
interference,
selective
prosecution, poor management and sloppy performance at the Office.
Since the Governor does currently appoint the Attorney General, the
office of the Attorney General may be subject to the unwanted,
unfair, and
vindictive
influence
of
the
Governor's
office.
Although
the
Attorney
General may argue otherwise, and does so indeed^ the preponderance of the
evidence and testimony
to
the contrary
is
staggering.
At
the
Judiciary
hearing,
under
sworn
testimony,
witnesses
attested
that
without
justifiable evidence, cases
are often thrown
out,
or sometimes
invidiously
created.
The Governor has cast a dark specter on the horizons of the
light
and openness and the
fair play and integrity of our democratic system.
To
say the
least,
I and the people
of Guam
are
utterly astonished, dismayed
and concerned about the
ability
of the Attorney
General
to
disassociate
himself
from
political
intervention
at
its
highest
level.
We
must
not
permit the power of the law as exercised by an appointed Attorney General
to
chill the
basic tenets of democracy that allow the
leaders and citizens
of
our community
to
debate
and
discuss
issues
that
affect
our
lives
without the fear of retribution and revenge.
The Governor should not and must not violate the independence of the
Attorney
General's
office.
It
is fundamental
to
the
underpinning
of our
democratic
process
of openness and
fair
play that
the
Attorney General
not be used as an apparatus of the head of the executive
branch,
for the
Page 2 of 3
96
power Qf the
law
is too great and pervasive to be used as
a
political
tool
of
a smgie
person.
We
have seen what happens when
a
sinole
oerson
controls
the
law
instead
of
serving
the
people.
History
is
replete
with
.nd,v.duals
who
have
fulfilled
their
temptations
although
un^^
e Tnd
hurtful,
simply because they have the power to do so
We have seen
it
with Napoleon, Hitler, Stalin and Marcos.
®"
'*
The
sunlit
reasoning
of
democratic
principles
that
esoouses
toTlT^Ll':/'"'''''. '^"^"' ^° ''' generaf populace
instead o
to
a
single
appointing
authority
is
exigently
appropriate
now
The
Attorney General should not be
a
bfite
noire- he or she must represent the
common good and the consensual public interest.
represent the
electoralft'i 7r!ifZ T
^'. ^^''
"^^''''^^"^ ^' ^^^ empowerment of the
electorate
to
hold
its
directly
accountable
to
the
people
An
elected
process'
but'r th^rr "r" ^'? ''''''' °^ P°"^'" ^'°- the"se,ection
process
but
rather
that
the
politics
and
the
selection
process
are
nrh??^'°"'^°"'^ ^' ''' P^°P'^'
^'^ '^'
ballot box.
These
are no
new
Tur sHi.rin'
""'
^^V^'^'"^'
'^"^ '''^''
^^^''^ '^'^ have been blazed by othe^
Ct f^H
'
''
'^'^
'"'^"'"^
'^'
^°^^
^°
political
maturation.
I? we
must endure
a tempest along the
pilgrimage,
let
it be
so.
However
c^n
Zt
^^^"'"? ^i"d
approaching
us,
signaling
us
of
the
tranquHHty
that
lies ahead at the end of our journey.
'Huni.iy mat
Dangkolo
na
Si
Yu'os
Ma'ase".
Once
again,
I
thank
you
for
the
opportunity to present this testimony.
^
"^
Respectfully submitted.
yi^nte C. Pangelinan
MenwgrTzSrd Guam Legislature
Page 3 of 3
97
UNITED
NATIONS
General Assembly
Distr
LIMITED
A/AC. 109/L.1843
10 July 1996
ORIGINAL:
SPECIAL COMMITTEE ON THE SITUATION
WITH REGARD TO THE IMPLEMENTATION
OF THE DECLARATION ON THE GRANTING
OF INDEPENDENCE TO COLONIAL
COUNTRIES AND PEOPLES
REPORT OF THE SUBCOMMITTEE ON SMALL TERRITORIES,
PETITIONS,
INFORMATION AND ASSISTANCE
Rapporteur
:
Ms.
Roslyn Lauren KHAN-CUMMINGS
(Trinidad and Tobago)
Paragraphs
Page
QUESTION OF THE NON- SELF-GOVERNING TERRITORIES OF
AMERICAN SAMOA,
ANGUILLA,
BERMUDA,
BRITISH VIRGIN
ISLANDS,
CAYMAN
ISLANDS,
GUAM,
MONTSERRAT,
PITCAIRN,
ST.
HELENA,
TOKELAU,
TURKS AND CAICOS
ISLANDS AND
UNITED STATES VIRGIN ISLANDS
1-9
3
A.
Consideration by the Subcommittee
1-8
3
B
Draft general
resolution
9
4
C.
Draft resolutions on specific conditions
-j,-;
prevailing
in American Samoa,
Anguilla,
Bermuda,
British Virgin
Islands,
Cayman
Islands,
Guam,
Montserrat,
Pitcairn,
St.
Helena,
Turks and Caicos
Islands and United States Virgin Islands
8
1
American Samoa
8
2
Anguilla
9
3
Bermuda
9
96-17143
(E)
180796
200796
A/AC. 109/L. 1843.
English
Page
2
CONTENTS
(continued)
Paragraphs
Page
4
British Virgin Islands
10
5
Cayman Islands
11
6
Guam
12
7
Montserrat
13
8
Pitcairn
14
9.
St.
Helena
15
10
Turks and Caicos
Islands
15
11
United States Virgin Islands
16
II.
QUESTION OF DISSEMINATION OF INFORMATION ON
DECOLONIZATION
10
-
23
17
A.
Consideration by the Subconvnittee
10-11
17
B.
Statement by the representative of
the Department
of Public
Information
12
-
15
18
C.
Statement by the representative of
the Department
of Political Affairs
16-21
19
D.
Week of Solidarity with the Peoples of All
Colonial Territories,
Fighting
for Freedom,
Independence and Human Rights
(27-31 May
1996)
...
22
20
E.
Draft resolution on dissemination of information
on decolonization
23
22
III
.
ADOPTION OF THE REPORT
24
-
25
23
A/AC.109/L. 1843
English
Paje
3
I.
QUESTION OF THE NON-SELF-GOVERNING TERRITORIES OF AMERICAN
SAMOA,
ANGUILLA,
BERMUDA,
BRITISH VIRGIN ISLANDS,
CAYMAN
ISLANDS,
GUAM,
MONTSERRAT,
PITCAIRN,
ST.
HELENA,
TOKELAU,
TURKS AND CAICOS
ISLANDS AND UNITED STATES VIRGIN ISLANDS
A.
Consideration bv the Subcommittee
1.
The Subcommittee on Small Territories,
Petitions,
Information and
Assistance considered the Territories of American Samoa,
Anguilla,
Bermuda,
British Virgin
Islands,
Cayman
Islands,
Guam,
Montserrat,
Pitcairn,
St.
Helena,
Tokelau,
Turks and Caicos
Islands and United States Virgin Islands en bloc
at
its 696th to 702nd meetings,
from
26 June to
8 July 1996.
2.
During
its consideration of
these
items,
the Subcommittee had before
it
working papers prepared by the Secretariat on those Territories
(A/AC. 109/2041
and Corr.l,
2043,
2044 and Add.l,
2045,
2047 and Add.l,
2050-2053,
2054 and
Add.l,
2055 and 2056)
3.
The Subcommittee conducted
a review of
the political,
economic and social
conditions
in each of
the Territories
in the
light of
the information contained
in the working papers prepared by the Secretariat.
The Subcommittee noted that
the information contained
in the working papers was not always up to date and
that
the Secretariat relied
in some instances on published sources.
The
Subcommittee requested the administering Powers
to cooperate with the
Secretariat
in furnishing information on the Territories.
4.
In
the course of
its
review,
the Subcommittee considered all aspects
of
the
issues relating to the Non- Self -Governing Territories and focused attention on
the
following:
(a)
Progress or lack of progress
in ascertaining the wishes of
the
population of the Territories regarding their future status
,-
(b)
The position of
the territorial Governments and political parties and
constitutional developments on the question of
the future status of
the
Territories;
(c)
The general socio-economic developments and specific problems faced by
some Territories
in respect of environment,
drug-trafficking,
etc.,-
(d)
The dispatch of visiting missions and participation of representatives
of Non-Self -Governing Territories
in the work of the Committee so that
the
Comnittee can obtain first-hand information on the wishes of the population.
5.
The Subcommittee noted that
in some cases there was no up-to-date
information to ascertain the wishes of the population regarding their future
status.
It remains convinced that the wishes and aspirations of the people of
the Territories should continue to guide the development of their future
political status and that referendums,
free amd fair elections,
and other forms
of popular consultation play an important role in ascertaining the wishes and
aspirations of the people
.
The outcome of such exercises would help the
/...
100
A/AC. 109/L.X843
English
Page
4
Subcommittee
in reviewing the
list of
the Non-Self -Governing Territories with
which the Special
Contmnittee
is concerned.
The Subcommittee was aware
that
some
of
the Territories were not seeking independence but
sought other options
of
self-determination.
The Subcommittee also noted that
some Territories attached
priority to socio-economic development before making
a choice
as
to
their
future
status
6.
The Subcommittee attached importance
to
a review of
the
list
of
the
Non-Self -Governing Territories
in the
light
of
the
fact
that
the
International
Decade
for the Eradication of Colonialism by the year 2000
is well
past
its
mid-point
7.
In view of Tokelau's own decision-making agenda and related changes
to
the
legislative
framework
for Tokelau,
the Chairman
of
the Special Committee was
reqfuested by the
Permanent Representative
of New Zealand
to the United Nations
to allow the Administrator of Tokelau and the Failpule of Tokelau to appear
before
the Special Committee
to allow
it
to hear,
at
first
hand,
how decisions
on Tokelau's
future status are being made.
Accordingly,
the Subcommittee
recommended that
this year
the draft
resolution on specific conditions
prevailing
in Tokelau be considered and adopted by the Special Committee.
8.
The Subcommittee reiterated
its view that
the cooperation of all
administering Powers was essential
for the discharge of
its mandate and resolved
that
it should seek the cooperation of all administering Powers
through
demonstration of
a practical,
flexible and innovative approach.
The
Subcommittee was conscious
of
the changes
in the
international situation and the
consequent need to adapt
its approach
in tune with the changed circumstances.
The Subcommittee expressed
its readiness
to work with the administering Powers
in
a spirit of constructive cooperation to achieve the goals of
the United
Nations
in respect
of
the Non-Self -Governing Territories.
The Subcommittee
hoped that
the administering Powers would take note of
this new approach and
come forward with cooperation.
B
.
Draft general resolution
"
9.
Having considered the question of
the Non-Self -Governing Territories of
American Samoa,
Anguilla,
Bermuda,
the British Virgin
Islands,
the Cayman
Islands,
Guam,
Montserrat,
Pitcairn,
St.
Helena,
Tokelau,
the Turks and Caicos
Islands and the United States Virgin
Islands,
the Subcommittee has decided
to
recommend the following draft resolution for action by the Special Committee:
The Special Committee
,
Having considered the questions of
the Non-Self-Governing Territories
of
American Samoa,
Anguilla,
Bermuda,
the British Virgin
Islands,
the Cayman
Islands,
Guam,
Montserrat,
Pitcairn,
St.
Helena,
Tokelau,
the Turks and Caicos
Islands emd the United States Virgin Islands,
hereinafter
"the Territories",
Having examined the report of the Subcommittee on Small Territories,
Petitions,
Information and Assistance,
101
A/AC. 109/L. 1843
English
Page
5
Recalllno General Assembly resolution
1514
(XV)
of
14 December
1960,
containing the Declaration on the Granting of
Independence to Colonial Countries
and Peoples,
and
all
resolutions and decisions of the United Nations relating to
those Territories,
including,
in particular,
the resolutions adopted by the
General Assembly
at
its
fiftieth session on the individual Territories covered
by the present
resolution,
Recoonizinq that
the specific characteristics and the sentiments of
the
peoples
of the Territories require
flexible,
practical
and
innovative approaches
to the options of
self-determination,
without any prejudice to territorial
size,
geographical
location,
size of population or natural
resources.
Recalling General Assembly resolution
1541
(XV)
of
15 December
1960,
containing the principles that
should guide Member States
in determining whether
or
not
an obligation exists
to transmit the information called
for under
i
Article
73
e of the Charter
of
the United Nations,
^,
Expressing
its concern that even three and
a half decades after the
adoption
of the Declaration there still
remains
a number
of Non-Self-Governing
Territories,
Conscious of the need
to ensure the
full
and speedy implementation of the
Declaration
in respect
of the Territories,
in view of the target
set by the
United Nations
to eradicate colonialism by the year
2000,
Recoonizinq that
in the decolonization process there
is no alternative to
the principle of self-determination
as enunciated by
the General Assembly
in
its
resolutions
1514
(XV),
1541
(XV)
and other resolutions,
Noting with appreciation the continuing exemplary cooperation of New
Zealand,
as an administering Power,
in the work of the Special Committee,
and
welcoming the recent constitutional developments
in
Tolcelau,
Welcoming the stated position of the Government
of the United Kingdom of
Great
Britain and Northern
Ireland that
it continues to
talie seriously
its
obligations under the Charter of the United Nations to develop self-government
in the dependent Territories
and,
in cooperation with the
locally elected
Governments,
to ensure that
their constitutional
frameworks continue to meet the
wishes
of the people,
and the emphasis that
it
is ultimately
for the peoples of
the Territories
to decide their
future status,
Noting the stated position of the Government of the United States of
,
America that
it
supports
fully the principles of decolonization and takes
seriously
its obligations under the Charter of the United Nations to promote to
the utmost the well-being of the inhabitants of the Territories under United
States administration,
Aware of the special circumstances
of the geographical
location and
economic conditions of each Territory,
and bearing
in mind the necessity of
promoting economic stability and diversifying and strengthening
further the
economies of
the respective Territories
as
a matter of priority.
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6
Conscious of
the particular vulnerability of
the small Territories
to
natural disasters and environmental degradation,
Aware of
the usefulness both
to the Territories and to the Special
Committee
of
the participation of appointed and elected representatives
of
the
Territories
in the work of
the Special Committee,
Convinced that
the wishes and aspirations
cf
the peoples
of
the Territories
should continue
to guide
the development of
their
future political
status and
that
referendums,
free and
fair elections,
and other
forms
of popular
consultation play an important
role
in ascertaining
the wishes and aspirations
of
the people.
Convinced that
any negotiations
to determine
the status
of
a Territory must
not take place without
an active
involvement and participation of
the people of
that Territory,
Recognizing that all available options
for self-determination are valid as
long as they are
in accordance with the freely expressed wishes of
the peoples
concerned and
in conformity with the clearly defined principles contained
in
General Assembly resolutions
1514
(XV)
,
1541
(XV)
and other Assembly
resolutions,
Mindful
that United Nations visiting missions provide an effective means of
ascertaining the situation
in the Territories,
and considering
that
the
possibility of sending further visiting missions
to the Territories at an
appropriate time and
in consultation with the administering Powers should be
kept under review.
Mindful also that
the holding of
the seminars
in the Caribbean and Pacific
regions alternately and at United Nations Headquarters or any other venue,
as
appropriate,
provides an effective means
for the Special Committee
to discharge
its mandate and promote
the goals of
the
International Decade
for the
Eradication of Colonialism by the year
2000,
Mindful
further that some Territories have not had any United Nations
visiting mission for
a
long period of
time.
Noting with appreciation the contribution to the development of some
Territories by specialized agencies and other organizations of
the United
Nations
system,
in particular the United Nations Development
Programme,
and
regional
institutions such as
the Caribbean Development
Bank,
1.
Approves the report of
the Subcommittee on Small Territories,
Petitions,
Information and Assistance relating
to American Samoa,
Anguilla,
Bermuda,
the British Virgin Islands,
the Cayman
Islands,
Guam,
Montserrat,
Pitcairn,
St.
Helena,
Tokelau,
the Turks and Caicos
Islands and the United
States Virgin Islands
;
2.
Reaffirms
the inalienable right of
the peoples of the Territories to
self-determination,
including,
if they so wish,
independence,
in conformity with
the Charter of
the United Nations and General Assembly resolution 1514
(XV)
,
/.
.
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containing the Declaration on
the Granting of
Independence
to Colonial Countries
and Peoples;
3.
Reaffirms also that
it
is ultimately for
the peoples of
the
Territories themselves
to determine
freely their future political status
in
accordance with the relevant provisions of
the Charter,
the Declaration and the
relevant resolutions of
the General
Assembly,
and
in that connection calls upon
the administering Powers,
in cooperation with the territorial Governments,
to
facilitate programmes
of political education
in the Territories
in order to
foster an awareness among
the people
of
the legitimate political status options
open to them
in
the exercise of their right
to self-determination;
4.
Requests
the administering Powers,
having ascertained the views
of
the
peoples
of
the Territories,
regularly to report to the Secretary-General
on the
wishes and aspirations of
the people regarding their
future political
status;
5
Stresses the need to seek
further ways and means
to enhance the
Special Committee's understanding
of
the conditions and wishes of
the peoples
ol
the Territories;
6.
Recmests
the administering Powers and the representatives of
the
peoples of
the Territories
to assist
the Special Committee by inviting the
United Nations visiting missions
at appropriate
times
to monitor the status of
the Territories;
7.
Reaffirms
the responsibility of
the administering Powers under the
Charter
to promote
the economic and social development and to preserve the
cultural
identity of
the Territories,
and recommends
that priority continue
to
be given,
in consultation with the territorial Governments concerned,
to the
strengthening and diversification of
their respective economies;
8.
Requests
the administering Powers
in consultation with the peoples of
the Territories
to take all necessary measures
to protect and conserve the
environment
of
the Territories under their administration against any
environmental degradation,
and requests the specialized agencies concerned to
continue
to monitor environmental conditions
in those Territories;
9.
Calls upon the administering Powers,
in cooperation with the
respective territorial Governments,
to continue
to take all necessary measures
to counter problems
related
to drug trafficking,
money laundering and other
offences;
10.
Stresses
that
the achievement of
the declared goal
of eradication of
colonialism by the year 2000 requires
the
full and constructive cooperation of
all parties concerned,
in particular the administering Powers;
11.
Urges Member States
to contribute
to the efforts of
the United Nations
to usher
in the twenty- first century
in
a world free of colonialism,
and calls
upon them to continue
to give their full support
to the Special Committee
in its
endeavours towards
that noble goal;
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8
12.
Invites
the specialized agencies and other organizations
of
the United
Nations system to initiate or
to continue
to take
all necessary measures
to
accelerate progress
in the social and economic
life
of
the Territories;
13.
Decides
to continue
the examination
of
the question of
the small
Territories
in order
to assist
the peoples of
the Territories
to exercise their
right
to self-determination,
and to report
thereon
to the General Assembly at
its fifty-first session.
C.
Draft resolutions on specific conditions prevailing
in
American Samoa.
Anquilla,
Bermuda.
British Virgin
Islands.
Cayman
Islands.
Guam.
Montserrat.
Pitcairn,
St.
Helena.
Turks and Caicos
Islands and United States
Virgin Islands
1
.
American Samoa
The Special Committee
.
Referring
to the general
resolution above.
Noting the report by the administering Power that most American Samoan
leaders express satisfaction with the
island's present relationship with the
United States of America,
Noting the non-participation of
the representatives
of
the people
of
American Samoa
in the
last
two regional
seminars.
Noting also that
the Government of
the Territory continues
to have
significant
financial,
budgetary and internal control problems and that
the
Territory's deficit and financial condition are compounded by the high demand
for government services
from the rapidly growing population,
a limited economic
and tax base,
and recent natural disasters.
Noting further that
the Territory,
similar
to isolated communities with
limited
funds,
continues
to experience
lack of adequate medical
facilities and
other
inf rastructural
requirements,
especially the provision of safe drinking
water to all villages
in American Samoa,
Aware of
the efforts
of
the Government of
the Territory to control and
reduce expenditures,
while continuing
its programme
of expanding and
diversifying the
local economy,
1.
Requests the administering
Power,
bearing in mind the views of
the
people of
the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations
of
the people regarding
their future political status
;
2.
Calls upon the administering Power
to continue to assist
the
territorial Government
in the economic and social development of
the Territory,
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9
including measures
to rebuild financial management capabilities and
strengthening other governmental
functions of
the Government of
the Territory.
The Special Committee
.
Referring
to the general
resolution above.
Noting the non- receipt
of
up-to-date information on the Territory from the
administering
Power and that
a
last visiting mission took place
in
1984,
Noting also that
information considered by the Subcommittee was made
available
from published sources.
Conscious of
the commitment
of both the Government
of Anguilla and the
administering
Power
to
a new and closer policy of dialogue and partnership
through the Country Policy Plan
for
1993-1997,
Aware
of
the efforts
of
the Government
of Anguilla
to continue
to develop
the Territory as
a viable offshore centre and well-regulated financial centre
for
investors,
by enacting modern company and trust
laws,
as well
as partnership
and insurance legislation,
and computerizing the company registry system.
Noting the need
for continued cooperation between
the administering Power
and the territorial Government m tackling the problems
of drug trafficking and
money laundering,
1.
Requests
the administering
Power,
bearing
in mind
the views
of
the
people
of
the Territory ascertained through
a democratic process,
to keep
the
Secretary-General
informed of
the wishes and aspirations
of
the people regarding
their
future political
status,-
2.
Calls upon the administering Power and all
countries,
organizations
and United Nations agencies
to continue
to assist
the Territory
in social and
economic development.
3
.
Bermuda
The Special Committee
.
Referring
to the general
resolution above,
Noting the results of
the
independence referendum held on
16 August
1995,
Conscious of
the different viewpoints of
the political parties of
the
Territory on the future status of
the Territory,
Noting the measures taken by the Government
to combat racism and the plan
to set up a Commission for Unity and Racial
Equality,
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10
Noting with concern the report
in the Royal Gazette of
23 Noveni>er 1995
that approximately
19 per cent
of Bermuda's households
live
in
a state of
poverty and continue
to receive some form of assistance
from the Government,
Noting also the report of
the
intended closure of
the
foreign military
bases and installations
in the Territory,
Taking into consideration the statement made
in October
1995
by
the
Finance
Minister for the transfer of those
lands
for development projects,
1.
Requests
the administering
Power,
bearing
in mind the views
of
the
people of
the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations
of
the people regarding
their future political
status;
2.
Calls upon the administering Power
to continue
its programmes
of
socio-economic development
of
the Territory;
3.
Also reouests
the administering Power
to elaborate, m consultation
with the territorial Government,
programmes of development specifically intended
to alleviate the economic,
social and environmental consequences of
the closure
of certain military bases and installations
in the Territory.
4
.
British Virgin Islands
The Special Committee
.
Referring
to the general resolution above.
Noting the completion of
the constitutional review
in the Territory and the
coming
into
force of
the amended Constitution,
and noting also the results of
the general elections held on 20 February
1995,
Noting further
the results of
the constitutional review of 1993-1994,
which
made
it clear
that
a prerequisite
to independence must be
a constitutionally
expressed wish by the people as
a result of
a referendum.
Taking note of
the statement made
in 1995 by the Chief Minister of
the
British Virgin Islands
that
the Territory was ready
for constitutional and
political advancement towards
full
internal self-government and that
the
administering Power should assist
through gradual
transfer of power to elected
territorial
representatives.
Noting that
the Territory
is emerging as one of
the world's leading
offshore
financial
centres.
Noting also the need
for continued cooperation between the administering
Power and the territorial Government
in countering drug trafficking and money
laundering.
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11
^
1.
Requests
the administering
Power,
bearing
in mind the views
of
the
people of
the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations of
the people regarding
their
future political
status;
2.
Also requests
the administering
Power,
specialized agencies and other
organizations
of
the United Nations system and all
financial
institutions
to
continue
to provide assistance
to the Territory
for socio-economic development
and development
of human resources,
bearing
in mind the vulnerability of
the
Territory to external
factors.
5
.
Cayman Islands
The Special
Committee
.
Referring
to
the general
resolution above,
Noting
the non-receipt
of up-to-date
information on the Territory from the
administering Power and that
a
last visiting mission took place
in
1977,
Noting also that
information considered by the Subcommittee was made
available
from published sources.
Not ing
the constitutional
review of
1992-1993,
according
to which the
population expressed
the sentiment
that
the existing relations with the United
Kingdom of Great Britain and Northern
Ireland should be maintained and that
the
current status
of
the Territory should not be altered.
Aware that
the Territory has one
of
the highest per capita
incomes
in the
region,
a stable political
climate,
and virtually no unemployment.
Noting also the actions taken by the territorial Government
to implement
its localization programme to promote
increased participation of
the
local
population
in the decision-making process
in the Cayman
Islands,
Noting with concern the vulnerability of
the Territory to drug trafficking
and related activities.
Noting further the measures taken by the authorities
to deal with those
problems.
Noting that
the Territory has emerged as one of the world's leading
offshore financial
centres,
1.
Requests
the administering Power,
bearing
in mind the views of
the
people of the Territory ascertained through a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations of
the people regarding
their future political
status,-
<
2.
Also requests
the administering Power,
the specialized agencies and
other organizations of
the United Nations system to continue
to provide the
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12
territorial Government with all
required expertise
to enable
it
to achieve
its
socio-economic aims;
3
Calls upon
the administering Power and the territorial Government
to
continue
to cooperate
to counter problems
related to money laundering,
smuggling
of
funds and other related crimes,
as well
as drug trafficking;
4.
Requests
the administering
Power,
in consultation with the territorial
Government,
to continue
to facilitate
the expansion of
the current programme
of
securing employment
for
the
local population,
in particular
at
the
decision-making
level.
The Special Committee
,
Referring
to the general
resolution above.
Recalling
that,
in
a referendum held
in
1987,
the people of Guam endorsed
a
draft Guam Commonwealth Act
that would establish
a new framework
for relations
between the Territory and the administering
Power,
providing
for an
increased
measure of
internal self-government
for Guam and recognition
of
the
right
of
the
people of Guam to self-determination
for
the Territory,
Recalling also the
requests by elected representatives and non -governmental
organizations of
the Territory that Guam not
be removed from the
list
of
the
Non-Self -Governing Territories with which the Special Committee
is concerned
pending the exercise of self-determination by the Chamorro people.
Aware of
the continued negotiations between the administering Power and the
territorial Government on the draft Guam Commonwealth Act and on the future
status of
the Territory,
with particular emphasis on the question of
the
evolution of
the relationship between the United States
of America and Guam,
Cognizant
that
the administering Power continues to implement
its programme
of transferring surplus
federal
land to the Government
of Guam,
Noting that
the people of
the Territory have called for reform in the
programme of the administering Power with respect to the
thorough,
unconditional
and expeditious transfer of land property to the people of Guam,
Conscious
that
immigration into Guam has resulted
in the indigenous
Chamorros becoming
a minority
in their homeland.
Aware of
the potential
for diversifying and developing the economy of Guam
through commercial
fishing and agriculture and other viable activities,
Taking note of
the proposed closing and realigning of
four United States
Navy installations on Guam and the request
for the establishment of a transition
period to develop some of
the closed facilities ae commercial enterprises.
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13
Recalling the dispatch
in
1979 of
a United Nations visiting mission to the
Territory and noting the recommendation of
the
1996
Pacific Regional Seminar for
sending
a visiting mission to Guam,
1.
Calls upon the administering Power
to facilitate the exercise of
self-determination by the Chamorro people of Guam for the Territory,
as endorsed
by the people of Guam
in the draft Guam Commonwealth Act,
and
to keep the
Secretary-General
informed of
the progress
to that
end;
2.
Requests
the administering Power to continue
to assist
the elected
territorial Government
in achieving
its political,
economic and social goals;
1^
3.
Also requests the administering Power,
in cooperation with the
Cerritorial Government,
to continue the transfer of
land to the people of
the
Territory and to take the necessary steps
to safeguard their property rights;
4.
Further requests the administering Power to continue
to recognize and
respect the political
rights and the cultural and ethnic
identity of
the
Chamorro people and
to take all necessary measures
to respond
to the concerns of
the territorial Government with regard to the
immigration
issue;
5.
Requests
the administering Power
to implement programmes specifically
intended to promote
the sustainable development
of economic activities and
enterprises by the Chamorro people;
6.
Also requests
the administering Power to continue
to support
appropriate measures by the territorial Government aimed at promoting growth
in
conmercial
fishing and agriculture and other viable activities.
7
.
Montserrat
The Special Committee
.
Referring to the general
resolution above.
Noting the non- receipt of up-to-date information on the Territory from the
administering Power and that a last visiting mission took place in 1982,
Noting also that
information considered by the Subcommittee was made
available from published sources.
Noting the functioning of
a democratic process
in Montserrat,
Taking note of the reported statement of
the Chief Minister that his
preference was
for independence within
a political union with
the Organization
of Eastern Caribbean States and that self-reliance was more of
a priority than
independence
,
Noting with concern the dire consequences of a volcanic eruption,
which led
to the evacxiation of a third of the Territory's population to safe areas of the
island.
r<
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Noting also the efforts of
the administering
Power and the Government of
the Territory to meet
the emergency situation caused by the volcanic eruption,
including the implementation of
a wide range of contingency measures
for both
private and public sectors
in Montserrat
Noting further the coordinated response measures taken by the United
Nations Development Programme and the assistance
of
the United Nations disaster
management
team,
Noting with deep concern that
a substantial number
of
the
inhabitants
of
the Territory continue
to live
in shelters because
of volcanic activity,
1.
Requests
the administering
Power,
bearing
in mxnd the views
of
the
people of the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations
of
the people regarding
their future political
status;
2.
Calls upon the administering
Power,
the specialized agencies and other
organizations of
the United Nations system,
as well
as regional and other
organizations
to provide urgent emergency assistance
to the Territory in
alleviating the consequences of
the volcanic eruption.
8
.
Pitcairn
The Special Committee
.
Referring to the general
resolution above.
Taking into account
the unique nature
of
Pitcairn
in terms of population
and area.
Expressing
its satisfaction with the continued economic and social
advancement
of
the Territory,
as well
as with the
improvement
of
its
communications with the outside world and
its management plan
to address
conservation
issues,
1.
Requests
the administering
Power,
bearing
in mind the views
of
the
people of
the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations
of
the people regarding
their future political status;
2
Also requests the administering Power to continue
its assistance
for
the improvement of the economic,
social,
educational and other conditions of the
population of the Territory.
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9.
St.
Helena
The Special Committee
.
Referring
to the general
resolution above.
Taking
into account
the unique character of
the Territory,
its population
and
its natural
resources,
Aware of
the request by the Legislative Council of
St.
Helena
that the
administering
Power conduct
a constitutional
review in the Territory,
Noting
the statement
of
1995 by the administering Power
that
the Governor
of
the island would be ready to enter
into debate on
a constitutional
review of
St.
Helena,
Aware of
the establishment
by the Government
of
the Territory of
the
Development Agency
in
1995
to encourage private sector commercial development
on
the
island,
Aware of
the efforts of
the administering Power and the territorial
authorities
to
improve the socio-economic conditions of
the population of
,*
St.
Helena,
in particular
in the sphere of
food production,
1
Requests the administering Power to conduct
the constitutional
review
in the Territory,
taking into account the wishes of
its population;
2.
Also requests
the administering Power,
bearing
in mind the views of
the people of
the Territory ascertained through a democratic process,
to keep
the Secretary-General
informed of
the wishes and aspirations of
the people
regarding their
future political
status;
3
Further requests
the administering Power and relevant regional and
international organizations
to continue to support
the efforts of
the
territorial Government to address
the socio-economic development of
the
Territory.
10.
Turks and Caicos
Islands
The Special Committee
.
Referring
to the general resolution above.
Noting the recent petition by the political
, leaders of the Territory
addressed to the administering Power to recall
the Governor and the decision by
the administering Power to reject that petition.
Noting with interest the statement made and the information on the
political and economic situation in the Turks and Caicos Islands provided by the
Deputy Chief Minister of
the Territory to the Pacific Regional Seminar held at
Port Moresby in June
1996,
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16
Taking note of
the request by the Deputy Chief Minister of
the Territory
addressed to the Special Committee to visit
the Territory and ascertain the
wishes of
the people of
the Turks and Caicos
Islands with regard
to preparing
themselves
for self-government,
Noting also the establishment
in November 1995 of
the Action
Contunittee
for
Political
Independence,
formed by prominent political
figures from different
parties,
and
its stated goal
of educating the population
to the disadvantages
of
the present colonial
status and the benefits of
independence,
Noting further the efforts by the Government
of
the Territory to strengthen
financial management
in the public sector,
including efforts
to increase
revenue
,
Noting with concern the vulnerability of
the Territory to drug trafficking
and related activities,
as well as
its problems caused by illegal
immigration.
Noting the need for continued cooperation between the administering Power
and the territorial Government
in countering drug trafficking and money
laundering,
1.
Requests
the administering
Power,
bearing
in mind the views
of
the
people of
the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations
of
the people regarding
their future political
status;
2.
Invites the administering Power to take
fully into account
the wishes
and interests of
the Government and the people of the Turks and Caicos
Islands
in the governance of
the Territory;
3
Calls upon the administering Power and the relevant regional and
international organizations to continue to provide assistance
for the
improvement of
the economic,
social,
educational and other conditions
of
the
population of the Territory;
4
Calls upon the administering Power and the territorial Government
to
continue to cooperate to counter problems related to money laundering,
smuggling
of funds and other related crimes,
as well
as drug trafficking.
11
.
United States Virgin Islands
The Special
Comroittee
.
Referring to the general resolution above.
Not ing that general elections were held in November
1994,
Noting also that 27.5 per cent of
the electorate participated in the
referendum on the political status of
the Territory on
11 October
1993,
and that
80.4 per cent of those who voted supported the existing territorial status
113
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Page
17
arrangements with the United States
of America,
and that
the referendum left the
status
issue undecided.
Noting further
the continuing
interest
of
the territorial Government
in
seeking associate membership
in the Organization of Eastern Caribbean States and
observer status
in
the Caribbean Community,
Noting
the necessity of
further diversifying the Territory's economy.
Noting also that
the question of Water
Island
is still under discussion
between
the Government
of
the Territory and the administering
Power,
Noting
further
the efforts of
the Government
of
the Territory to promote
the Territory as an offshore financial services centre,
Noting with satisfaction that
the Territory joined the International Drug
Enforcement Conference as
a
full member
in
1995,
which would strengthen
its
capability to combat
illegal drug trafficking.
Recalling the dispatch
in
1977 of
a United Nations visiting mission to the
Territory,
1.
Recmests
the administering
Power,
bearing
in mind the views of the
people
of
the Territory ascertained through
a democratic process,
to keep the
Secretary-General
informed of
the wishes and aspirations of
the people regarding
their
future political
status;
2.
Requests
the administering Power to continue
to assist
the territorial
Government
in achieving
its political,
economic and social goals;
3
Also requests
the administering Power
to facilitate
the participation
of
the Territory,
as appropriate,
in various organizations,
in particular the
Organization of Eastern Caribbean States and the Caribbean Community;
4
Welcomes the negotiations between the administering Power and the
territorial Government on the question of Water
Island.
II.
QUESTION OF DISSEMINATION OF INFORMATION ON DECOLONIZATION
A.
Consideration by the Subcommittee
10.
In accordance with
its programme of work
for
1996,
adopted at
its
696th meeting,
on
24 June
1996,
the Subcommittee on Small Territories,
Petitions,
Information and Assistance considered the question of dissemination
of
information on decolonization at
its 700th to 702nd meetings,
on
3 and
8 July 1996
11.
During
its consideration of
the question of dissemination of
information on
decolonization,
the Subcommittee held consultations with representatives of the
Department of Public
Information and the Department of Political Affairs of the
Secretariat
114
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18
B.
Statement by the representative of the Department
of Public Information
12.
In his statement,
the representative of
the Department
of
Public
Information said that
the Department's report covered the activities undertaken
by the Department during the period from May 1995
to April
1996.
The
Department's multimedia activities
included
a wide range
of
issues pertaining to
decolonization.
The adoption of General Assembly resolution
50/40 on
dissemination of information was highlighted by the Department's news programmes
for broadcasting organizations worldwide and received emphasis
in
its press
releases
in English and French.
13.
As part of
its regular coverage of United Nations activities,
the
Department
issued a total
of
48 press releases
in English and French on
issues
relating to decolonization.
During
1995,
a wide range of
information covering
all aspects of decolonization was processed by the staff
of
the United Nations
Yearbook
for volume
48,
covering the events of
1994,
as well
as
for volume
43,
a
backlog edition covering events
in
1989;
those volumes were being published
in
1996 and
1997,
respectively.
In the special
fiftieth anniversary commemorative
edition,
published in August
1995,
a major section entitled
"Emerging nations"
covered issues
relating to the end of
the
International Trusteeship system,
the
status of
the remaining Non-Self -Governing Territories,
the thirtieth
anniversary of
the
1960 Declaration,
and the dismantling of
the colonial
system,
including case studies on Algeria,
Angola,
Mozambique,
Namibia and Southern
Rhodesia.
The Department also continued to distribute the poster on
decolonization,
published
in
1994
in English,
French and Spanish,
entitled
"Complete Decolonization by the Year 2000
-
Freedom to Choose."
14
The Department produced 48
radio programmes which covered
a wide range
of
activities related to decolonization.
Related activities within the United
Nations system were also televised and disseminated through
feeds and dubs made
available to networks and other television stations and through packages
of
television news and video highlights provided to international news syndicators
The Department's Audio/Visual Library continued to make tapes and cassettes
available
to correspondents,
delegates.
United Nations radio producers and
outside producers on decolonization issues.
15.
The worldwide network of
68 United Nations
information centres and services
continued to distribute the Department's information materials relating
to
decolonization,
through the local media,
non-governmental organizations and
educational
institutions.
The same materials also formed part of United Nations
Information Centres reference library collections.
Whenever appropriate,
the
Centres incorporated such information in their briefings on the work of
the
Organization as well as
in their newsletters.
The United Nations
Information
Centre at Port-of -Spain assisted the Special Committee during the Caribbean
Regional Seminar on decolonization held from
3
to
S July
1995.
Audio material
recorded during the Seminar,
including special
interviews,
was
sent
to
Headquarters
for production of radio programmes
for global distribution.
/...
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19
C.
Statement by the representative of
the Department
of Political Affairs
16.
In his statement before
the Subcommittee,
the representative of
the
Department
of Political Affairs reviewed the Department's activities
in 1995
in
the area
of dissemination of
information on decolonization.
He drew the
attention of
the Subcommittee members
to the provisions of
the most recent
General
.Assembly resolution on dissemination of
information on decolonization
(resolution
50/40)
with regard to the
functions of Department
of Political
Affairs
17.
In the
light of
the provisions of
that resolution,
the work of
the
Department
in the dissemination of
information was
focused on three major areas:
(a)
oral dissemination of
information through personal contacts of the
Department's officers with leading experts on Non-Self -Governing Territories,
representatives
from academia and media organizations;
(b)
the systematic
distribution of documents on decolonization issues,
in close cooperation with
the Department of Public
Information,
particularly in connection with regional
seminars and events
in other
forums,
at United Nations Headquarters and
elsewhere;
and
(c)
various contributions prepared by the Department
of
Political
Affairs
for recurrent
or occasional United Nations publications.
All these
activities were closely coordinated with the relevant departments and services
of
the United Nations Secretariat,
first and foremost with the Department's
longstanding partner,
the Department of Public Information.
18.
One area
in which
the contribution of
the Department
of
Political Affairs
was considered important
was,
as
in the previous years,
the political advice and
up-to-date information provided by the Department
to the Department of
Public
Information
in the preparation of published materials.
Continuing
its past
practice,
the Department cooperated with the Department of
Public
Information in
the preparation of
relevant chapters
for the
1995 United Nations Yearbook
.
The
questions covered
in that
contribution
included,
actions by the General Assembly
and
its subsidiary bodies,
implementation of
the resolutions on decolonization
by the specialized agencies,
foreign economic and other interests
in the
Territories,
scholarship programmes and training for the
inhabitants of
the
Non-Self -Governing Territories and other decolonization issues.
In this context
the representative of
the Department
of Political Affairs mentioned the updating
of
information that the Department undertook
for various organizations'
Yearbooks,
including those distributed through electronic media.
He also said
that desk officers
of
the Department responsible
for decolonization continued to
provide an ongoing consultation for the United Nations
tour guides on the
decolonization questions
for the general public visiting Headquarters.
19.
The Department availed itself
of
the opportunity provided by the seminars
organized by the Special Committee away from Headquarters to disseminate
information on decolonization.
The representative of
the Department stated
that,
given the diminished human resources of the Department of Political
Affairs involved
in servicing decolonization bodies and providing working
documents on decolonization
issues
to the General Assembly and
its subsidiary
bodies,
it was becoming more and more difficult
to attend to various requests
from academia,
the general public and individuals
for specific
information on
decolonization.
The regional seminars provided a unique opportxinity to
116
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2
accomplish several major tasks at one
time.
It helped the Department
to collect
up-to-date
information on the political
and, constitutional developments
in
the
Territories through discussions with representatives
from the Non-Self -Governing
Territories,
as well
as experts and non-governmental organizations active
in the
field of decolonization;
the Department achieved
a great deal by directly
disseminating
in bulk various working documents
of
the Special Committee and its
subsidiary bodies
as well
as other material published by the Department
of
Public Information at
the venue of
the seminar.
The recent Pacific Regional
Seminar had offered an excellent opportunity for dissemination of
information.
The direct contact and exchange of
information with the administrator of
Tokelau,
the Chief Minister
of Gibraltar and the Deputy Chief Minister of
the
Turks and Caicos
Islands,
as well
as representatives
from New Caledonia,
East
Timor and the Falkland Islands
(Malvinas)
and other participants,
was useful
in
rendering
the services of
the Department on
the work of
the Special Committee.
20.
The Department
of
Political Affairs also attached great
importance to the
distribution of
information on decolonization,
and took particular care to reply
to individual
requests
for information on the work of
the United Nations
in the
field of decolonization,
although those requests seemed to have diminished
in
recent years.
The Department maintained regular and fruitful contacts with
regional and intergovernmental organizations,
both
in the Caribbean and the
Pacific regions,
especially CARICOM,
the Eastern Caribbean Development
Bank,
the
Caribbean Development Bank and the South Pacific
Forun..
The valuable
input
from
those organizations on the
issues
facing small
island Non- Self -Governing
Territories enabled the Department
to undertake more thorough analysis
of the
problems
faced by those Territories and
to reflect
them adequately
in the
working papers.
The representative of
the Department said that
that source was
becoming even more important
in the absence of up-to-date information on the
Territories
from some of
the administering Powers.
21.
The representative of
the Department assured the Subcommittee that
the
Department would make every effort
to fulfil
the mandate within the limits of
its diminished resources and the financial constraints
facing the Organization.
He concluded by saying
that
the Department of Political Affairs would take
into
consideration the guidelines and recommendations
the Subcommittee would make at
the conclusion of
its current
session.
D.
Week of Solidarity with the Peoples of All Colonial
Territories.
Fighting for Freedom.
Independence and
Human Rights
(27-31 May 1996 )
22.
In accordance with the programme of work
for
1996 adopted by the Special
Committee at
its
1454th meeting,
on
16 February
1996,
the Subcommittee on Small
Territories,
Petitions,
Information and Assistance was
to consider the question
of
the Week of Solidarity at
its meetings
in May
1996.
Since the Pacific
Regional Seminar was held from
12
to
14 June
1996,
the meetings of
the
Subcommittee scheduled for May had to be moved to
a later date.
Since the dates
for the Week of Solidarity were
in close proximity to the Pacific Regional
Seminar,
the Chairmcui found
it most appropriate
to make
the statement on the
occasion of
the Week of Solidarity at
the Seminar on
14 June
1996.
The
statement was as
follows:
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21
"Since
1972,
in accordance with General Assembly resolution
2911
(XXVII)
,
the Governments and peoples of
the world have been observing
annually a Week of Solidarity with the Peoples of All Colonial Territories.
This celebration
is
in full accord with the purposes and tenets embodied
in
the Charter of
the United Nations and
is
in conformity with the principles
enshrined
in the Declaration on the Granting of
Independence
to Colonial
Countries and Peoples,
contained
in Assembly resolution
1514
(XV)
"Today,
when our Organization
talces
a closer
loo)c at
its achievements,
its success
in the
field of decolonization
is universally recognized.
Hundreds of millions gained their freedom and independence
in the surge of
decolonization following
the creation of
the United Nations.
Their
membership
in the United Nations as sovereign States strengthened the
fundamental basis of
the
international community.
"We remember
the history of
the struggles against colonialism and pay
tribute
to all
those who took part
in them.
We remain mindful
of
the
sacrifices
that made
it possible
for hundreds of millions of peoples
to
achieve self-determination and independence.
"However important
the success
in the field of decolonization,
the
task
is
still unfinished
in that area and requires further concerted and
determined action on the part
of all those
involved.
There are still
peoples who have not been able
to exercise their right
to
self-determination.
These are mostly peoples of
small
island
Non-Self-Governing Territories located mainly
in the Pacific and Caribbean
regions.
They are confronted,
inter alia ,
by problems of their small
size,
low population,
geographic remoteness,
limited natural resources and
vulnerability to natural disasters.
Their situations require new and
innovative solutions geared towards
the implementation of
the International
Decade
for the Eradication of Colonialism launched by the General Assembly
in 1988.
"Convinced as we are that
in the decolonization process there
is no
alternative
to the principle of self-determination,
we once again reiterate
the legitimacy of all options of self-determination consistent with General
Assembly resolutions
1514
(XV)
and 1541
(XV)
as long as
it
is ascertained
that they are the freely expressed wishes of
the peoples concerned.
We
should continue to exercise flexibility and realism in our endeavours
to
complete the process of decolonization.
The wishes of the peoples of the
Non- Self -Governing Territories should not be ignored when examining once
again the options of self-determination available
to them.
"In that connection,
we further appeal
for the strengthened and
continued support of the administering Powers,
whose cooperation with the
Special Conmittee
is essential
for the progress of the Territories towards
self-determination.
We count on the support of the specialized agencies,
which should continue to assist the Non-Self -Governing Territories
in
enhancing their standard of living and promoting their self-sufficiency.
We count on regional and international organizations,
which should explore
new avenues to provide the Non-Self -Governing Territories with legal and
political opportunities for participating in programmes that relate to
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22
their environment and livelihood.
We count on support
for our efforts
from
all Member States and non-governmental organizations.
"We hope and believe that our combined,
unrelenting efforts will
ensure the fulfilment
of
the promise
for
freedom,
lasting peace,
sustained
growth and sustainable development
for all
the peoples of our planet
in
accordance with the purposes and principles of
the United Nations."
E.
Draft resolution on dissemination of
information
on decolonization
23.
Having concluded
its examination of
the
item,
the Subcommittee decided to
recommend the following draft resolution
for action by the Special
Committee:
The Special Committee
.
Having examined cjuestions
relating
to the dissemination of
information on
decolonization.
Recalling General Assembly resolution
1514
(XV)
of
14 December
1960,
containing the Declaration on
the Granting of
Independence
to Colonial Countries
and Peoples,
and other resolutions and decisions
of
the United Nations
concerning the dissemination of
information on decolonization,
in particular
General Assembly resolution
50/40 of
6 December
1995,
Recognizing the need for
flexible,
practical and innovative approaches
towards reviewing the options of self-determination
for
the peoples
of
Non- Self -Governing Territories with
a view to achieving complete decolonization
by the year
2000,
Reiterating the importance of dissemination of
information as an instrument
for furthering the aims of
the Declaration,
and mindful
of
the
role of world
public opinion in effectively assisting the peoples of Non-Self -Governing
Territories
to achieve self-determination.
Aware of the role of non-governmental organizations
in the dissemination of
information on decolonization,
1.
Approves the activities
in the field of dissemination of
information
on decolonization undertaken by the Department of Public Information and the
Department
of Political Affairs;
2.
Considers
it important
to continue
its efforts
to ensure the widest
possible dissemination of information
oi> decolonization,
with particular
emphasis on the options of self-determination available
for the peoples of
Non-Self -Qov«ming Territories;
3
Requests the Department of Political Affairs and the Department of
Public Information to take
into account
the suggestions of
the Special Committee
to continue their efforts to take measures through all the media available,
including publications,
radio and television,
as well as the
Internet,
to give
A/AC.109/L.ie43
English
Page
23
publicity to the work of
the United Nations
in the field of decolonization and,
inter alia
:
(a)
To continue
to collect,
prepare and disseminate,
particularly to the
Territories,
basic material on
the
issues of self-determination of
the peoples
of Non-Self-Governing Territories;
(b)
To seek the full cooperation of
the administering Powers
in the
discharge of
the
tasfScs referred to above;
(c)
To maintain
a working relationship with the appropriate regional and
intergovernmental organizations,
particularly
in the Pacific and Caribbean
regions,
by holding periodic consultations and exchanging information;
(d)
To encourage
involvement
of non-governmental organizations
in the
dissemination of
information on decolonization;
(e)
To report
to the Special Committee on measures taken
in the
implementation of
the present resolution;
4.
Requests all
States,
including the administering Powers,
to continue
to extend their cooperation
in the dissemination of information referred to in
paragraph
2 above
III.
ADOPTION OF THE REPORT
24.
Having carefully examined the situation
in the Non-Self -Governing
Territories and the question of dissemination of information on decolonization,
the Subcommittee adopted by consensus the texts of the preceding draft
resolutions,
and conclusions and recommendations contained therein,
at
its
702nd meeting,
on
8 July
1996,
for action by the Special Committee.
25.
At
the same meeting,
the Subcommittee adopted the present
report.
120
VIRGIN ISLANDS AND NORTHERN MARIANA
ISLANDS ISSUES
WEDNESDAY, JUNE 26, 1996
House of Representatives, Subcommittee on Native
American and Insular Affairs, Committee on Re-
sources,
Washington, DC.
The Subcommittee met, pursuant to
call, at 2:10 p.m.,
in room
1334,
Longworth
House
Office
Building,
Hon.
Elton
Gallegly
(Chairman of the Subcommittee) presiding.
STATEMENT OF HON. ELTON GALLEGLY, A U.S. REPRESENTA-
TIVE FROM CALIFORNIA; AND CHAIRMAN, SUBCOMMITTEE
ON NATIVE AMERICAN AND INSULAR AFFAIRS
Mr. Gallegly.
It is a pleasure to begin this hearing on the Vir-
gin Islands issue with a warm welcome to the distinguished Gov-
ernor of the Virgin Islands, my good friend Governor Roy Schnei-
der. Welcome, Grovemor.
I am fortunate to have seen firsthand the
efforts of the Governor to bring about order in the aftermath of the
hurricanes which blasted the Virgin Islands last year.
In addition,
I am aware of a number of the measures the Gov-
ernor has undertaken to improve the fiscal health of the territory
and
to promote economic development and
self-sufficiency
in the
Virgin Islands. You are
to be commended
for these
efforts. Gov-
ernor, and
I would hope that consideration of the legislative pro-
posals before the Subcommittee today would further advance your
initiatives.
Today, the Subcommittee will hear testimony regarding two leg-
islative proposals introduced by the Virgin Islands' Delegate Victor
Frazer: H.R. 3634, to amend provisions of the Revised Organic Act
of the Virgin Islands, and H.R. 3635, to transfer management au-
thority
for the Christiansted
Historic
Site
to the Virgin
Islands.
These seem to represent straightforward proposals to improve the
management of the Government of the Virgin Islands.
There are two panels presenting testimony. First, the panel with
Governor Schneider will be introduced by Delegate Frazer, followed
by the Administration's panel of the Director of the National Park
Service, Roger Kennedy, and the Director of the Office of Insular
Affairs, Allen Stayman. So with
that,
I guess we would ask our
friend. Congressman Frazer, to introduce our first panel.
[Prepared statement of Hon. Elton Gallegly follows:]
Statement of Hon. Elton Gallegly
As the Virgin Islands has not yet adopted a Constitution, changes to the laws of
governance may require a congressional enactment of a change in the Organic Act
of the Virgin Islands. The Two provisions in H.R. 3634, the Revised Organic Act of
the Virgin Islands wovild clarify the meaning of the temporary absence of the Gov-
ernor or Lt. Governor to not include physical absence from the territory. Modem
telecommunications permits these executive officials of the Virgin Islands to main-
tain contact and effectively make decisions long-distance.
In addition, the Virgin Islands would be authorized to issue parity bonds instead
of priority bonds as now
reqviired by the Organic Act. This should
result in
in-
121
creased savings to the Virgin Islands and the issuance of parity bonds is a common
P'^&t'VeT wfdSc?thl sfc'reS^'of the Interior to transfer management au-
thority of the Christiansted Historic
site upon the request of the Governor of the
Vi?5n Is ands and completion of an agreement. The Governor of the Virgin Islands
hSdicated the Virgin Islands could more effectively management and operate the
sffacre s!te in the hSrt of christiansted. The Secretary
s given complete discretion
??deten^ine?he ability of the Virgin Islands to financially manage f
n<i op^^^te the
historicTite
Also
title to the property is retained by the Umted States and the Sec-
reta?? may temiinate the agreement if the terms are not met, revoke the authority
to Snaee thrsite
The
bill clearly provides the Secretary with the discretion to
£jfn flnf temiinate the transfer of authority to manage the historic
site,
would
ho?e that thHould be recoS^zed and that there woulH not be an automatic rejec-
tion to a bmt^pennit the Eving of federal funds and the devolution of manage-
ment to a local government.
STATEMENT OF HON. VICTOR FRAZER, A DELEGATE IN
CONGRE^SSFROM THE TERRITORY OF THE VIRGIN ISLANDS
Mr
FRAZER. Good afternoon, Mr. Chairman and Members of the
Committee.
It gives me pleasure, Mr. Chairman
to mtroduce the
Governor
of the Virgin
Islands,
Dr. Roy L
Schneider. Governor
SchnSier speaks on lehalf of the people of the Virgin Islands here
^"^^d as
I said at a hearing this morning before the Senate Com-
mittee on Resources,
the Governor
is the person
that has been
elected to speak on behalf of the people of the islands, and
it is in
that capacity that he is here today.
f ^u
:.ior,^c
You are quite aware that very recently the people of the islands
awarded the Governor the Medal of Honor, the
first time
it has
been so ordered to a sitting governor. And they have also named
a hospital in St. Thomas after the Governor
the Roy L
Schneider
Hospital and Health Complex, as evidence of their satisfaction with
the Governor's performance.
.
.^^
nr.rrc.r.\n
Mr Chairman, H.R. 3634, as you said, would revise the Organic
Act to extend
it and to permit the Virgin Islands to come into the
21st century. The provision of this Act
is an impediment to a con-
tinuity of the Governor's authority when he leaves the island.
It is important that anyone dealing with the Government ot the
Virgin Islands through the Governor be assured that any negotia-
tions or contracts that they have with the government by way
ot
the Governor of the Virgin Islands are intact when he is physically
absent from the territory on official business, and
it should not be
construed as the Governor being out of the terntory and, therefore,
not be able to perform his duties.
I think that provision may have had some relevance in the horse
and buggy age.
It doesn't today when someone can be reached in-
stantaneously through our high tech means
of communication.
I
think
it
is important that we recognize that a territory,
like any
State, could only have one governor, and the President of the Unit-
ed States, when he leaves the country, he
is
still the President ot
the United States.
,
,
.
j ^u
^
„i^
So
I think
it
is important that
it be understood that we would
like no less for the chief executive of the Virgin Islands, that when
he is temporarily absent, he should not be considered physically ab-
sent from the territory.
,.„,.,,
u
-4.
Also, Mr. Chairman, H.R. 3635
is a
bill which has been quite
misunderstood and misquoted in the local paper.
I would
like
to
122
clarify that for those who have so reported
it. This bill directs the
Secretary of Interior to enter into an agreement with the Governor
of the Virgin Islands upon request to permit the Governor to have
authority to manage the Christiansted National Historic Site.
It is part of the Governor's overall plan to improve the waterfront
areas on both St. Thomas and St. Croix. So
it is not that the Gov-
ernor
is asking for title to the National Historic site on St. Croix.
He wants to manage that portion that
is
in his overall improve-
ment plan for both St. Thomas and St. Croix.
Mr. Chairman, without further
ado,
I would
like
to
introduce
Governor Roy
L.
Schneider,
the Governor of the Virgin
Islands,
who will speak on both bills on behalf of the people of the Virgin
Islands.
STATEMENT OF DR. ROY L. SCHNEffiER, GOVERNOR, U.S.
VIRGIN ISLANDS
Governor Schneider. Good afternoon.
Mr. Gallegly. Welcome, Governor, and thank you. Congressman
Frazer, for your opening comments.
Governor Schneider. Mr. Chairman and distinguished members
of the committee,
I am here today to discuss two bills which affect
the Virgin Islands. But before
I take up the business at hand, let
me take this opportunity to personally thank you, Mr. Chairman,
for all the help you provided immediately after the storm. We need-
ed you, and you were there.
Our recovery would not be possible were
it not for your involve-
ment and personal
attention and understanding. Your
ability
to
deal with the Federal Emergency Management Agency has
cer-
tainly worked to our benefit, and
I want to particularly thank you
for your follow-up visit to the Virgin Islands to make certain that
we are continuing to receive the assistance so necessary after dis-
asters of this size.
Now, Mr. Chairman, I know I have turned in my message to you,
and what I would like to do is to quickly summarize these two bills.
The first bill concerns having the management of part of Christian-
sted, which
is the eastern part of St.
Croix, the largest island
Christiansted in the east, Frederiksted to the west.
There
is a portion there right at the wharf that
is managed by
the Interior Department through the National Park Service. The
Chairman of the committee, Mr. Young, visited St. Croix and noted
firsthand
the
deterioration
of the
buildings. As
I understood
it,
from 1972, there was some agreement between the Interior Depart-
ment, National Park, and the Government of the Virgin Islands to
fix this area up.
It is more than 20 years. Nothing has been done.
Now, taking over this government a year and a half ago, review-
ing what ought to be done, we are fixing up the waterfront area
in
St. Thomas, the other island, the
capital. We want
to do the
same thing for
St. Croix. The problem we are having, Mr. Chair-
man, is not that we don't have the money, we don't have the plans,
the problem is the National Park Service.
They want to maintain this area as "historic." We are saying to
you, which
I am putting with tongue in cheek,
let us manage this
area. Even though reading the message from Mr. Murkowski in the
Senate
to the President, where he indicates that transferring
all
123
excess Federal lands to Guam, all excess Federal lands were trans-
ferred to Puerto Rico, all excess Federal lands are going to Vieques.
We haven't taken that route. Perhaps we ought to.
,
We are simply saying give us a chance to take an area that
is
important, not only as a historic
site, but also for the economy of
St
Croix We now have tourists going to
St. Croix more than we
did before
In 1994, 104 businesses were lost in St. Croix; the gain
on my administration, 38 new businesses. Does that say that we
are trying to turn things around and doing it well?
We have for you not a dream, not a pie-in-the-sky idea We have
for you a plan, Mr. Chairman. This is what we are going to do with
the Christiansted
area. We
are going
to take
this area that we
want to put grass all around, and we are going to p^t the historic
change, historic benches, Ughting.
I am sure you must have heard the past governor a^ed the IMa-
tional Park Service to light this area. They refused Two tourists
were killed in that area.
I do not want a repeat of that We have
the plans there—computerized drawings—of what we will do with
the entire
site. And
if your
staff will take a moment to look at
them, you will see that we are not dreaming.
,
r
j-
We already have everything to go, and we have the funding m
place
I don't see why there is opposition from a Federal agency to
an area—a government that
is changing, moving, and indicating
that we have a sense of what is necessary.
a/t
nu
•
In this transfer of management, we are saying to you, Mr. onair-
man, that when
it happens, if we do not go along with these plans
that we have in a timely fashion, not over 20 years that they have
not worked, we will then let it go back to the Interior Department
if that is so. So we are serious about what we are doing.
But we cannot have concern of the businesses that are now oe-
ginning to make
it being pushed away from the people who come
to their shops because the National Park Service—they don t think
it should be there. Ask your Chairman, Mr. Young how he found
these buildings that they claim should not be touched.
I am saying to you
I recognize as a physician the seriousness ot
making sure that we do what we said we will do and making sure
it
is done right. So
I then
will ask you to approve this area. VVe
cannot go on what happened in the past. We are telling you what
we plan and what we intend to do.
^
^
-n^ ^
The
long
and
short
of
it
is
that
the management
ot
l<ort
Christiansvaern by the National Park Service has been like having
a part of Christiansted declared foreign
soil. H.R. 3635 would re-
quire the Secretary of Interior to enter into an agreement with the
Governor that puts management of the fort back in the hands
ot
the Government of the Virgin Islands. And
I ask you to approve
this
bill and let us start doing what
is right for the people ot the
Virgin Islands and the Federal Government and our nation.
The second bill, Mr. Chairman, has to do with bringing the Vir-
gin Islands government in line with what
is done now. When the
Governor leaves the Virgin Islands, by the Organic Act, which
is
presently the constitution of the Virgin Islands, which the Congress
of the Virgin
Islands
all
right
to change through the
territorial
clause, we are asking you to make
it possible that the Governor
can continue to have control of the government.
124
Who
is ready more than the Governor? Who
is really the light-
ning rod for information to deal with investors, to deal with folks
who are getting their—to bring us out of our problems? The Gov-
ernor cannot in the short time bring someone who
is acting up to
date with
all of the information that
is necessary to continue our
government activities.
We have asked that
it be placed in law that when the Governor
leaves the Virgin Islands, he retains control of the territory. Right
now today because the Lieutenant Governor is not in the Virgin Is-
lands, the Governor of the Virgin Islands
is the Commissioner of
Finance.
I have before me from our Virgin Islands session law. More than
25 times when the Governor left the Virgin Islands and the acting
governor, sometimes the Lieutenant Governor, sometimes the Com-
missioner
of Finance,
vetoed
bills,
changed
the
laws,
and
just
caused confusion.
I think with the new technology that we have—a fax and all the
different telephones,
there
is
really no need
for
this. When the
President leaves America, he still retains his control of the govern-
ment. We should be able to do the same things. That
is truly the
position of the Virgin Islands people.
A local newspaper that usually acts against our administration
sided with us by stating in the
editorial, "We are v/ith Governor
Roy Schneider on the issue of removing acting governor status from
the Lieutenant Governor when the Governor is off island. It is like
using carbon paper in an era of photocopiers, faxes, and e-mail."
And it went on and on.
The issue is not one of who
is acting governor. The issue is that
the Governor needs to have some continuity in running the busi-
ness of the Virgin Islands, Mr. Chairman.
I am ready to answer
any questions that you might have on these two issues.
[Prepared statement of Governor Roy L. Schneider may be found
at the end of the hearing.]
Mr. Gallegly, Thank you again for being here, Governor. Just
a couple questions back on the Christiansted issue; Under the cur-
rent management of the historic
site, could you be a
little more
specific with problems
that you have
identified with
the
status
quo?
Governor Schneider. The problems that we have identified basi-
cally are two:
inactivity; no repair. Those are two.
If you were a
tourist coming to that area and seeing the fort, seeing the custom
building, and seeing the general area,
it looks terrible. That is not
part of my operation.
You have been in the Virgin Islands and see what I do to deterio-
rated buildings.
It should be done. The Government of the Virgin
Islands and those
properties run by us should not
look broken
down. No one should take 20 plus years
to do
repairs
to those
buildings. It is unacceptable.
Second, when
it comes to people being able to park in the area,
we should develop the parking area and charge for
it. We can have
revenues from that to take up the management. Thirdly,
it
is ut-
terly ridiculous that we can accept that citizens coming from else-
where or anyone should lose their lives because of inactivity, insen-
125
sitivity that you cannot light an area when requested by the Gov-
ernment of the Virgin Islands.
The other Administration, Governor Farley, did exactly that.
I
think
it is terrible.
It
is terrible for not only the Virgin Islands,
it
is terrible for the United States that this should happen.
I do not
want a repeat of that, and we swear to you that give us a chance
to show what we can do. We have done
it already with many other
areas.
We now are getting ready to do
it in
St. Thomas. Fortunately,
in
St. Thomas, we have funding for that repair of the shoreline
from the transportation area, and they are working with us also to
do that. For example, we are putting a boardwalk—an area to walk
from Christiansted on the coastline
all the way to the other area,
making something for tourists and indeed for the residents. They
want us to stop at the line of the
fort, go back up on ground, go
around, and then get back on the boardwalk. This is utterly ridicu-
lous, Mr. Chairman.
Mr. Gallegly. Governor, obviously, there was significant infra-
structure, as you have shown on your tentative plans there, and
you have talked about having the revenue to make
this happen.
And, obviously, there
is going to be an ongoing cost of operation.
Do you plan on using user
fees
or would there be
significantly
greater fees to the visitors visiting?
I visited there, you know, just this last year, and historically
it
is an absolutely amazing place and
I think even greater potential
than exists today. And I have to agree with you on that.
But do you see significant increases for visitors who would want
to
visit the
fort and visit the area? You mentioned parking
fees,
which
I guess wouldn't be
significant, but what about those who
would want to visit the fort? What
is it? Two bucks now or some-
thing like that?
Governor Schneider. Yes. But I do not see this
Mr. Gallegly. Or do you think it just increases the economic de-
velopment of the area as far as shopping and things like that?
Governor Schneider. Yes,
it does. And
it helps the businesses.
In the local newspaper from
St. Croix, we have some copies there
where the businesses are crying out, "What are you trying to do to
us? We can't have these folks come into our shops? They have to
go way down in the middle of town. It doesn't make any sense."
Mr. Gallegly. But you don't see it costing the visitors there any
more money to visit the historic aspects?
Governor Schneider. Of course not. We think that vve are simply
developing something nice or nicer than it is now for visitors to see.
It is not a matter of increasing costs.
Mr. Gallegly. And the economic development
in the forms
of
commercial enterprises would benefit St. Croix and the VI
Governor Schneider. Definitely.
Mr. Gallegly.—through that economic development? How have
you been received by the Park Service?
Governor Schneider. Well, in essence, again, I hate to say it, but
I will say
it publicly. The approach of the Park Service has been
close to colonialism. The superintendents who run these parks be-
lieve that they were sent by God to control the Virgin Islands and
27-245 0-96-5
126
other places. They totally don't hear,
I believe. Something is wrong
with the auditory nerve.
During a storm, in St. John when we needed to get to the other
side of St. John, one of the superintendents had the gall to suggest
to us we cannot go through on the road that had already been cut.
We simply wanted to clear the road and let the people go from one
side of the island to the other.
He insisted, "You can't do this. You are destroying the environ-
ment below." "What about the people who
can't go
to the Puxa
area,"
I indicated to him, "if another storm comes? And that is the
only way to go. We will go." If he gets in the way, we will bulldoze
him over.
Mr. Gallegly. Governor, with all due respect,
I wish you could
be a little more candid with our—I appreciate you being here. Gov-
ernor, as always.
I defer at this time to the ranking member, my
good friend, Congressman Faleomavaega.
Mr. Faleomavaega. Mr. Chairman,
I too would like to recognize
our good friend and representative for the Virgin Islands, my good
friend. Congressman Vic Frazer, and certainly welcome the pres-
ence of Governor Schneider also before our Subcommittee.
I am very happy and delighted, Mr. Chairman, that you have
taken the initiative to have our Subcommittee consider these two
bills that relates to the needs of the Virgin Islands. And I sincerely
hope that it will be positive.
I do have a sense of concern with one of the bills concerning the
historical park.
I hope that our good friend, the Chairman of the
National Park Subcommittee, will defer to us and allow us to take
this
legislation
to
its
fullest measure
so that there won't be any
conflicts, obviously, from the testimony of Governor Schneider by
the statement relating to the fact that the National Park Service
is totally objecting to this proposed change.
And without the benefit of their testimony, and
I don't see that
we have any representatives of the Park Service before us for this
hearing this afternoon,
I hope that maybe at a later time we will
have their presence before our Subcommittee. But saying that, Mr.
Chairman,
I welcome the Governor's statement.
I think in principle
I hope that our friends of the Park Service
will be compassionate and fully understanding to the needs of the
Virgin Islands as expressed by their elected leaders, and hopefully
that there
is a sincere
effort on the part of the Park Service
to
work with the leaders of the Virgin Islands.
And
it
is
unfortunate
if Governor
Schneider makes
the
cat-
egorization or Statement of the fact that
it is almost a colonial pe-
riod of reign there in the Virgin Islands, and hopefully this
is not
the case. But
I do want to thank Governor Schneider for his state-
ment and also Congressman Frazer for bringing this two measures
before the Subcommittee.
Just one question that I have about the problems of the Governor
leaving the territory, and
I am sure as you are aware. Governor
Schneider, we are
all caught in the same situation as
well.
Is
it
very often in the Virgin Islands that the Lieutenant Governor also
leaves the territory where then you end up with a member of the
cabinet having to become the acting governor?
Governor Schneider. Once every month.
127
Mr. Faleomavaega. So you feel that this also has the support of
the legislature of the Virgin Islands, that by amending this provi-
sion of the Organic Act that the Governor be treated just like you
would the President? Where you go you are
still the Governor, ob-
viously, but for purposes of amending or signing or vetoing legisla-
tion,
this
is something that ought
to be kept
strictly within the
providence of the authority of the Governor, and this
is basically
what this amendment proposes to change?
Governor Schneider. Yes, sir.
Mr. Faleomavaega.
All
right. Thank you, Mr. Chairman, and
thank you. Governor Schneider. Did you have a comment?
Governor SCHNEIDER. Yes,
sir. Mr. Chairman,
I didn't get a mo-
ment to mention another part of our consideration hearing in
bill
form—is the question of the bonds—^the debt payment of bonds.
It
was suggested by Mr. Frazer that we bring this up because we are
asking the Congress to also have another change
in the Organic
Act, and this change
is in the Organic Act of the Virgin Islands.
We must do our debt service for bonds through something called
priority debt. We are asking it to be changed to parity debt. In pri-
ority debt, after you float bonds, you place them in priority—one,
two, three, four—for paying. In parity, all the bonds are floated on
an even keel—even level.
I am saying to you because of priority, which we are perhaps the
only jurisdiction that has this when
it was placed in our Organic
Act some years ago—it hasn't been changed—we know the floating
bonds and the collateralization of those bonds are sometimes four
to five times, which is unnecessary because it is not required by the
bonding agencies.
It
is
required
by
law
so
we
now
are
placing
all
this
collateralization. So when we float bonds, which has been done in
the past, we have to overcoUateralize by placing moneys to pay
it
off, which we use our excise tax on rum, which the Congress has
been so kind to have us retain in order to pay the debt.
But in addition to that, we have to place over five funds, which
decreased significantly our cash-flow, in order to collateralize these
priority bonds.
I am saying to you
if we can change from priority
to
parity, not only would we be able to perhaps release some of
those collateralization, we will be able now to float bonds and not
have to pay as much to have them floated. Why do we have to do
it? Because we don't have the funding to do all the necessary repair
that we
have
to
do
because
of
the
destruction
by
Hurricane
Marilyn.
But, more importantly, right now, we are on the decrees from the
Federal Court for three or four projects. One of them we are being
charged 2 to $4,000 a day. So
I am saying to you in order for us
to immediately correct the problem, we need that change in the Or-
ganic Act again from priority to parity debt.
Mr. Gallegly. The gentleman from Guam, Mr. Underwood.
Mr. Underwood. Yes. Thank you, Mr. Chairman, and thank you
for your testimony. Governor Schneider, and yours as well
in the
introduction of your bills our friend and colleague, Mr. Frazer.
I
just have a couple of questions. Have you discussed any of your
plans with the National Park Service, and what has been their re-
action?
128
And
it seems to me that given the nature of this bill, which real-
ly extends a great deal of approval authority to the Secretary under
this, that there would be very few objections to
it. And
I am kind
of surprised by your comment that the National Park Service per-
haps has not been as collaborative as they could be.
Governor Schneider. Mr. Member, we even met with the Na-
tional Park personnel on the
site in
St. Croix with the Chairman
of the committee, Mr. Young, and their position was the same—re-
sistance.
I don't see what else we can
do. We called Mr. Roberts
several times to discuss personally with him. We were not able to
get
through.
It
is something we have
spoken
to Mr.
Stayman,
which is somewhat below, to get this done. But, again,
it has to be
done by someone who can say yea or nay, and this
is not possible.
Mr. Underwood. OK. How did this property come into the hands
of the National Park Service? Was
it originally taken for this pur-
pose? Was it always Federal property?
Governor Schneider.
I think it was always Federal property, the
same as Water Island. And, again, that
is another area—that we
are trying to have that area transferred to the Virgin Islands Gov-
ernment. We did have some cooperation, and we have gotten a por-
tion of it—the landfill area, the beach, the part where the hotel
is,
the roads—turned over to us. And they are saying that we would
not do in Christiansted.
As soon as we got the transfer of Water Island, an island outside
of St. Thomas, turned over to us, in a matter of one week,
I had
the entire island with electricity. In a matter of one week, we took
up all the debris that was there.
In a matter of one week, we developed a commission to go in and
talk with the people that live there and come up with plans, not
the Governor's plan, a plan of people of the Virgin Islands with in-
sight, with experience. And we are getting this worked out.
We are now awaiting for them to turn over the property where
the people are now living. That is a complicated issue because they
are trying to deal with a person who, what you call a lease owner
for that area, but that should be done. And I think they are moving
ahead, and we are asking them, "Let us move ahead so we can take
this area."
So from the experience with my government—I can't speak what
happened before—but since we took over, we have demonstrated to
the Interior Department that when given the responsibility for any-
thing, we move rapidly, and we do it right.
Mr. Underwood. And
I also just want to make a brief comment
on the bill amending the Organic Act.
I notice that in this morn-
ing's testimony you were with the Lieutenant Governor on
this.
Has he rushed home?
Governor Schneider.
I think he took
his video with him. No.
The Lieutenant Governor, as you know,
is now a candidate for the
delegate seat so an3rthing that would enhance that position
I sup-
pose
is worth talking about. But
I speak for the people of the Vir-
gin Islands.
Mr. Underwood. Very good. And
I appreciate that and under-
stand that fully. Thank you. Governor.
Mr. Gallegly. Governor, thank you very much for being here.
As always,
it
is a pleasure to see you. Congressman Frazer,
it
is
129
always a pleasure to have you before the committee, and we look
forward
to continuing
to work with you
in a very
positive way.
Thank you very much.
Now we have our second panel. We have Mr. Allen Stayman, Di-
rector of the Office of Insular Affairs, and Roger Kennedy, Director
of the National Park Service. Mr. Stayman.
STATEMENT OF ALLEN P. STAYMAN, DIRECTOR, OFFICE OF
INSULAR AFFAIRS
Mr. Stayman. Thank you, Mr. Chairman. Mr. Chairman, mem-
bers of the Subcommittee,
I am pleased to be here today to discuss
the provisions of H.R. 3634 and to discuss the second annual report
on the Federal-CNMI
Initiative on Labor, Immigration, and Law
Enforcement
in the Commonwealth
of the Northern Mariana
Is-
lands.
First, with respect to 3634, Section 2 of the bill provides that nei-
ther the Governor nor the Lieutenant Governor of the Virgin
Is-
lands need relinquish authority while traveling outside the Virgin
Islands on government business.
In
light of today's technology, we believe the proposed amend-
ment is appropriate, and the Administration supports enactment of
Section
2. Section 3 of the bill deals with bonding authority of the
Virgin Islands when its bonds are secured by the coverover of Fed-
eral excise taxes on rum.
Section
3 would
allow the Virgin
Islands
to
issue
parity debt
rather than priority debt. This change would place the Virgin
Is-
lands on a footing similar to other communities. The Administra-
tion has no objection to its enactment.
I will now turn to Mr. Ken-
nedy to discuss the other bill.
[Prepared statement of Allen
P. Stayman may be found at the
end of the hearing.]
Mr. Gallegly. Mr. Kennedy.
STATEMENT OF ROGER KENNEDY, DIRECTOR, NATIONAL
PARK SERVICE
Mr. Kennedy. Mr. Chairman,
I am sorry that
I can't agree with
the Governor on a number of matters. We apparently have a re-
spectful disagreement, both as to fact and as to obligation. First of
all, may
I submit my formal statement for the record, and then
if
I may speak
Mr. Gallegly. Without objection.
Mr. Kennedy. There are two Organic Acts here. One
is for the
islands and the other is for the National Park Service and System.
The Organic Act
of the National Park Service and System
calls
upon us
to be trustees for the preservation and protection of the
places selected by the American people—all of the American people
to serve all of the American people.
We oppose the enactment of H.R. 3635 essentially because
it
is
a park divestiture
bill.
It says that, 'Tou will take out of the Na-
tional Park System a park that
is of national significance, that
is
part of a system that was developed on purpose for very good rea-
son."
I don't think it is probably useful to take your time as a commit-
tee for me to debate with the Governor the mutual behavior of peo-
130
pie who work for the Park Service or people who work for the Gov-
ernor.
There are,
I think, a couple of facts that may be useful in the
record, and they are these: first, the Water Island matter, to which
the Governor referred, does not involve any parkland at all, and
it
has not occurred. There has been no transfer of land with regard
to Water Island.
With regard to our holdings—that
is, our responsibilities in the
islands—let me just run through those quickly for you. There is the
Virgin Islands National Park, which includes portions of St. John
and
portions
of
St. Thomas and Hassle
Island, which
is
off St.
Thomas. There is the Buck Island Reef, which is a national monu-
ment.
There
is the
Salt River National
Historic Park and Ecological
Preserve. Christiansted
is the only national historic
site. And the
question arises has there or has there not been inaction with
re-
gard to the Federal taxpayers as acting through the National Park
Service in recent years?
All of the
historic structures
in the care of the National Park
Service are currently, despite budgetary difficulties, maintained in
accordance
with what
are known
as
the
Secretary's
standards,
which are true in all Administrations—the same standards.
Since
1980, about
$3.5
to 4
million
of the Federal
taxpayers'
money—$3.5
to 4 million—has gone, excluding repairs
for hurri-
cane damage, for the restoration and preservation of historic struc-
tures in this particular place.
Every
year,
the
Federal taxpayers
pick up
the
tab
for about
$200,000
in annual maintenance
of these
properties, and about
$300,000 goes into programs in this park, which include the usual
run of things we do in all national parks of an educational sort.
But in addition to that, and that
is on-site talks in schools and
civic groups and the
like, 27 museum
exhibits,
five
historic
fur-
nished rooms, 17 waysides, a big, handsome park brochure, which
has been planned and completed, and, in fact, on a sort of everyday
basis we are operating here just about the way
I suspect that we
are operating in all national historic sites.
What is before us is a proposal to take a unit out of the National
Park System for developmental purposes. What is proposed, among
other things,
is the construction of a boardwalk that goes around
the exterior of a historic
fort, and the building of a restaurant in
the commandant's quarters at Fort Christiansvaem. That
is what
is before us, Mr. Chairman. Do you want or do you not want to
keep the National Park System entire?
[Prepared statement of Roger G. Kennedy may be found at the
end of hearing.]
Mr. Gallegly.
Is
that
the
conclusion
of your comments, Mr.
Kennedy?
Mr. Kennedy. Yes, sir.
Mr. Gallegly. Mr. Kennedy, correct me if I am wrong, but last
month the National Park Service transferred the management of
city of Rocks in Idaho to the State in accordance with legislation
similar to this. Is this correct?
131
Mr. Kennedy.
I am not directly familiar with the legislation for
city of Rocks, but
I will certainly agree with whatever
it is you tell
me is true in that matter, sir.
Mr. Gallegly. You and Secretary Babbitt agreed to that trans-
fer. Is that not correct?
Mr. Kennedy.
I don't believe that is a national historic site,
sir,
but if you
Mr. Gallegly.
I didn't say it was a national historic site.
Mr. Kennedy. Oh, OK.
Mr. Gallegly. But
I did say
it was Park Service controlled land
that provided for the benefit of the public, that the Park Service
had jurisdiction
over, that they transferred
to the
State.
Is that
correct?
Mr. Kennedy.
If you say so,
sir.
I am not familiar with the de-
tails of that proposal, nor do
I know whether
it went for devel-
opmental purposes or not.
Mr. Gallegly. OK. Today, and
I will tell you that
I believe this
to be very similar in nature, there apparently or
it appears to be
an attempt to politicize this action as a park closure.
Is that cor-
rect? That you are referring to this as a park closure, not a transfer
of jurisdiction?
Mr. Kennedy.
It takes a unit out of the management of the Na-
tional Park System, and
it places
it in the management of another
entity.
Mr. Gallegly. Right, similar to what happened with the city of
Rocks in Idaho, which came out of the jurisdiction of NPS and went
into another jurisdiction; in this case, the State of Idaho. Do you
see any parallel there?
Mr. Kennedy.
I don't much. This is a historic site with very sig-
nificant historic buildings in
it, visited by international visitors be-
cause of its historic character, and the National Park Service, as
long as
it remains
in the custody of the National Park
Service,
would strive to sustain its historic integrity.
Mr. Gallegly. Well, of course, there
is some, obviously, historic
parts of the city of Rocks, and anyway maybe not from a historical
building, but go back quite a ways as well. Let us just move on to
maybe one other question, and then
I will defer to my good friend
from American Samoa.
If this did take place and the management of Christiansted went
to St. Croix instead of the Park Service, there, obviously, would be
some dollars saved to the Park Service.
I think that is obvious.
Is
that some money that could be used to reopen campgrounds in Yel-
lowstone?
Mr.
Kentvtedy.
Oh,
I
suppose you
could make
that argument
about closing Independence
Hall, Mr. Chairman. You could save
some money there too I guess.
Mr. Gallegly. OK. Well, are you suggesting that we do that?
Mr. Kennedy. No,
sir,
I am not, nor do
I suggest that we close
this one either.
Mr. Gallegly. At this time, I would defer to my good friend from
American Samoa, Mr. Faleomavaega.
Mr. Faleomavaega. Thank you, Mr. Chairman.
I would like to
thank Mr. Stayman and Director Kennedy for their statements.
I
just want to make sure for the record in most expressed form, Mr.
132
Stayman, on behalf of the Secretary of the Interior that your office
does
not
object
to
the proposed
transfer
of management
of the
Christiansted Historic Site
to the Virgin Island Government. Did
I hear that correctly?
Mr. Stayman. No. We, of course, are here representing the Presi-
dent, as well as the Department, and we have a single position,
and that is in opposition to that bill.
Mr. Faleomavaega. You do not support it
Mr. Stayman. No.
Mr. Faleomavaega.—as a matter of policy? So you are in sup-
port of the National Park Service objections to this proposed bill?
Mr. Stayman. Yes.
Mr. Faleomavaega. Mr. Kennedy, thank you for your statement.
A couple of questions. What you are saying to this Subcommittee
is that all the Congress needs to do is just simply transfer the au-
thority and that will be the end of
it.
Is that basically your prob-
lem, that Congress should give direction, and
it will be done?and
the
Congress
can
do what
it
wills. We
are
the Administrative
Branch, and we do what the Congress
tells us to
do. But
I was
asked to testify today to offer the judgment of the National Park
Service as to whether or not this unit of the National Park System
should be given away to a State, and our judgment is that should
not happen, sir.
Mr. Faleomavaega. And it is your opinion that the role of Den-
mark in its colonial period is one of the most historic aspects of this
historical park?
I have read some of the Dutch Colonies and his-
torically some of the things that they have done, and
I don't nec-
essarily agree
if that
is a matter of tremendous history that one
can be said that they are proud of. I don't know.
I haven't been to the historic park, and
I was just wondering if
the comments made by Governor Schneider
is such that—I hear
that both sides are saying that, yes, we really are making every ef-
fort to find common ground or for mutual agreement. Your basic
position is that you just simply feel that the Virgin Island Govern-
ment is incapable of maintaining the park. This
is what
I read in
your statement, and correct me if I am wrong on that.
Mr. Kennedy. In my statement to you,
sir,
I attempted to state
as clearly as
I could that our fundamental objection here is to the
divestiture of a significant unit of the National Park System. We
oppose that.
I didn't comment myself on the financial capability of
the Virgin Islands Government primarily because I personally have
no knowledge of the degree
to which the Virgin Islands (Jovern-
ment is taking care of those portions of this general area which it
already is responsible for.
There are a variety of judgments as to who is taking care of what
well.
I don't want to get into a discussion of that kind because
I
rather hope that when we get out of this room, the Governor and
the National Park
Service can
get
together on
a program
that
works for everybody's interest, and, therefore,
I don't want to get
into a bicker about who
is doing what to whom.
I just don't think
that is useful.
Mr. Faleomavaega. Well, with due respect,
sir, unless
if I read
the statement wrong here, and
I quote, "We wonder whether the
territory possesses both the expertise and the financial resources to
133
manage the park well." And
I continue, "The territory's record of
managing cultural sites is uneven at best," and then you cited the
Fort Frederick and the Fort Christian parks as falling short of the
standards of the National Park System.
So it seems to me that this is an indictment, as far as
I am con-
cerned, that there is a question of whether or not the leaders of the
Virgin Islands are capable of maintaining just this one historical
site that they are asking for.
Mr. Kennedy. It sort of comes down to how you or any of us here
as a visitor would look at what the Park Service is doing and what
the Virgin Islands Government has done with properties of equiva-
lent value in recent years. And the testimony before you represents
the professional judgment that, generally speaking, the Park Serv-
ice is doing a better job of it.
Mr. Faleomavaega. Thank you, Mr. Chairman, and Mr. Ken-
nedy. Thank you for your statement.
Mr. Gallegly. There
is currently a vote pending over on the
floor, and we are going to have to run over there and vote.
I would
turn the gavel over to my colleague from American Samoa since he
and Mr. Underwood won't be going over for the vote. But just be-
fore
I
leave,
I
can't
leave without—I was
sitting here
thinking
about Mr. Kenned/s suggestion about Independence Hall.
I happened to have the privilege of visiting Independence Hall
just last week with my wife. We don't have very many weekends
in Washington, and we did go up there, and what a tremendous
place that
is. And
I
still stand in awe very much, the same as
I
did the
first time
I took my children there many years ago. And
with all due respect to the National Park Service, which
I have a
lot of respect for,
I am not absolutely convinced that the State of
Pennsylvania couldn't do a good job.
I am not advocating that, but
since Mr. Kennedy did bring that up for consideration
Mr. Kennedy.
I didn't bring it up for consideration, sir. I thought
the idea so ludicrous, that
it would be compelling to suggest the
analogy.
Mr. Hastings. Would the Chairman yield just for a moment on
that?
Mr. Gallegly. Yes.
I would yield to the gentleman from Wash-
ington.
Mr. Hastings. In light of that also,
I think we can go no farther
than this State and find some national sites that are administered
very well by entities other than the Park Service.
Mr. Kennedy. We concur, sir.
Mr. Hastings. Like Mount Vernon, for example, like Monticello,
for example
Mr, Kennedy. Fully agree.
Mr. Hastings.—that do very well.
Mr. Kennedy. Yes, indeed. We entirely agree.
Mr. Gallegly. While we go over to vote,
I
will turn the gavel
over to my good friend from American Samoa, and perhaps he and
Mr. Underwood can continue the dialog. Did you have some ques-
tions that you wanted when we came back? If you do, we will keep
the hearing open. Otherwise, I don't want to hold the witnesses un-
less you wanted to ask a quick question.
134
Mr. GiLCHREST. A couple of very quick questions? Mr. Kennedy,
could you explain to us briefly how the Park Service gained
title
to this six acres in the beginning? And then what
is
it about the
management of this property that could not be given
to the Gov-
ernor of the Virgin Islands?
Mr. Kennedy.
I don't know the specific history of this
site, and
we will supply that for the record.
I do not know whether
it was
Federal property or not, and we will supply that to you.
Mr. GiLCHREST. But it is, in fact—does the Park Service have full
title to these six acres?
Mr. Kennedy. Yes,
I believe
so. The answer
is yes. And maybe
I can supply it right now if you would like an answer for that.
Mr. GiLCHREST. Was there ever an agreement from the very be-
ginning historically as to the relationship between the Park Serv-
ice, the Virgin Islands, and these six acres as to its continuing sta-
tus?
Mr, Kennedy.
In
1952, there was an agreement which essen-
tially was a cooperative one between the Service and the Virgin Is-
lands Government.
Mr. GiLCHREST. And what was that agreement? Was it a coopera-
tive agreement that
Mr. Kennedy. Well, that we would—it is in the middle of a town,
and the
intention was that people would get along better,
obvi-
ously, than they are at the moment. And that
is not a joint man-
agement agreement. It is a cooperative agreement.
Mr.
GiLCHREST. What was
the
longevity
of
that
cooperative
agreement? And suppose that the people in the community of the
Virgin Islands decided to take away their part of the deal?
Mr. Kennedy. It had no terminal date. There was no sunset.
Mr. GiLCHREST. There was no sunset. Suppose now as the Gov-
ernor is coming here saying that the deal was fine while
it lasted,
but we would
like
to manage this particular property. And then
could you give me a specific reason why the Park Service feels that
they don't want
to turn over the management of this park even
though the management of the park as designed in the
bill, as
I
can see
it, will be virtually the same as it is now?
Mr. Kennedy. Well,
it depends on who is responsible, of course,
for making the final decisions as to what you do in these places.
This
is a collection of buildings associated with a
fort, a govern-
ment house, and a succession of other largely neo-classical build-
ings along a waterfront and a very important Danish town or ini-
tially Danish, subsequently ours.
We are in the history business. That
is what we
do. We try to
help Americans understand about their history—all of the history,
the good part and the bad part. And that is what we do for a living.
Mr. GiLCHREST. Just if—let us suppose
it was turned over to the
Virgin Islands. Is there an estimate as to the amount of money the
Park Service would save?
Mr. Kennedy. The annu-^l budget of this park is about $300 op-
erating and about $200 on average and what we put into cyclical
maintenance; that is, taking care of the place.
Mr. GiLCHREST. So you are saying about $500,000 annually?
Mr. Kennedy.
Probably and
there
undoubtedly—I know
that
there has been more money than that put into the care of these
135
buildings since the Nation took them over. So how much additional
work you got to do to maintain old buildings,
it is continuous. You
could pretty much guess.
Mr. GiLCHREST. Thank you very much.
Mr. Faleomavaega.
[presiding] Thank you.
I would like to ask
a personal favor of Mr. Kennedy. Congressman Williams would like
a minute with you—
Mr. Kennedy. Sure.
Mr. Faleomavaega.—so
I would
like
to ask you
if you
could
wait. He is coming right back from voting.
Mr. Kennedy. Oh, absolutely.
I am even at his disposal.
Mr. Faleomavaega.
I am sorry. The gentleman from Guam also
has some questions.
Mr. Underwood. Yes, sir. Thank you for your testimony. In your
testimony, you basically articulate some reasons why you are op-
posed to this transfer of authority. And reading your testimony in
a cursory fashion, you make a statement that you are concerned
about the capacity of the Virgin Islands
to successfully deal and
manage this property.
You
are
also concerned about the
historic
significance
of this,
that this is part of the mandate of the National Park Service. And
in the judgment of history,
this
is a valuable historical property.
And then somewhere in the middle of your testimony,
I found very
interesting logic that you are talking about here.
And you connect
it
to a larger move
in which you say that in
February of '95 you opposed a bill that called for a study of the Na-
tional Park System with a view toward authorizing certain units.
"Passage of this bill would in a small but dangerous way begin that
process. Each of the 369 units of the National Park System in the
49 States, D.C., American Samoa, Guam, Puerto Rico, and the VI
was established by an Act of Congress, presidential proclamations,
or Secretaries' orders."
I would call that, you know—we see many of these kinds of state-
ments in reference to particular
bills.
I guess the shorthand way
of looking at that
is the slippery slope theory. Once you do
it for
one, you are going to have to end up doing it for others. So of those
three reasons, which is your primary concern?
Mr. Kennedy. Oh,
I think
it
is really two that are very closely
linked. One of them
is that this
is a place of national and inter-
national significance that belongs in the National Park System.
It
is important. That is what the Congress decided the first time.
Secondly,
it needs
to be treated by people who
are, generally
speaking, pretty good at dealing with national historic sites. They
get trained to do that, and they do
it pretty well.
It
is important
as well that those folks get along with
local people. This
is true
every place that we operate—368 places.
And in doing that,
it is also essential that we recognize increas-
ingly that there are cities and towns and territories that have got
financial and other problems.
It is just not true that cities, towns,
and States are rolling with money and are going to do a wonderful
job with places that are given
to them unless they change their
character
substantially.
Building restaurants
in and boardwalks
around historic structures may very well not be a good way to sus-
tain their historic fabric.
136
Mr. Faleomavaega. Would the gentleman yield?
Mr. Underwood. OK.
Mr. Faleomavaega. Just for one second.
I would
like to invite
our good friend from the Virgin Islands, Congressman Frazer, up
on the dais since he is the recognized expert on the Virgin Islands
before this committee. We would invite him up here and certainly
would welcome any of the questions that he might want to raise
with our panel members. So go ahead, Bob.
Mr. Underwood. OK. We are not really concerned with the ca-
pacity—I mean,
I know that
in some
respects they are
all very
much linked. But it seems to me that the concern about the slipper
slope,
if we do this to one, we are going to do this to
all, are you
telling me that
all of the units that are currently in the National
Park Service are all dealt with in the same way? There are no col-
laborative agreements? There are no other side agreements and co-
operative agreements? There
is not a kind of diversity of arrange-
ments that are possible?
Mr. Kennedy. There are but this bill calls for the divestiture of
management
responsibility from
the National Park
Service
to a
State or to a territory. That being true, that is a lot different than
a cooperative agreement, and that is a fundamental difference, and
we do oppose that, sir.
Mr. Underwood. Right. So the issue really
is control over the
property—over the park?
Mr. Kennedy. That is one word. You could say responsibility for.
That is another word.
Mr. Underwood. Well, as I read the bill,
it says here, "To trans-
fer the authority to manage upon a determination of the Secretary
of Interior that the Government of the VI has the financial ability
and commitment
to
maintain,"
so
that,
I
think,
deals with one
issue very successfully.
"Retain for the U.S. fee title to all property compromising Chris-
tiansted National Historic Site." Apparently, the Virgin Islanders
support
that.
I think the people
of Guam
if this were
in Guam
would support a
little
bit stronger version
of that. "Require the
Government of the VI to continue to use the historic
site for the
purposes for which it is used."
In my mind, that certainly extends to the Department of Interior
and Secretary of Interior the kind of authority and, if you will, veto
power that will continue to manage the site in a way which fulfills
the purposes of a historic
site. And, furthermore, in the last
sec-
tion,
it authorizes the Secretary to terminate the agreement and
revoke the authority.
Mr. Kennedy. Well,
it
is either in the National Park System or
it
is
not.
If the responsibility for management
is
in the hands of
somebody else, it is not in the National Park System, and we think
it should be.
Mr. Underwood. OK. In this instance,
I think that there are a
number of safeguards that would cause one to possibly think that
this
is a
distinct
possibility and
a good
idea worth
exploring.
I
would also draw attention in your statement that
all of the units
and all of these units in referencing all of the National Park Serv-
ice properties—all of these units represent diverse public resources
under our permanent stewardship.
137
And the word permanent strikes me as odd in this instance be-
cause really we are talking about diverse properties each individ-
ually acquired under either an executive order or under an Act of
Congress, which, of course, is at an3rtime changeable.
Mr. Kennedy. As long as they are ours, we have got a respon-
sibility to take a position, as we have been asked to take today,
with regard
to what our responsibilities
are. Of course, the Con-
gress makes the laws.
Mr. Underwood. OK. Thank you.
Mr. Faleomavaega. Mr. Frazer.
Mr. Frazer. Mr. Kennedy, are you opposed to taking the Ken-
nedy Center out of the Park System? Last year were you opposed
to that?
Mr. Kennedy. The Kennedy Center is a performing arts facility
in the city of Washington for which for many years has been trying
to raise the aggregate,
I guess, of about $100 million to take care
of its needs.
Its management concluded that
it was ready to not
only raise that kind of money, but to raise about that amount of
money more.
So under those circumstances, where it is a performing arts cen-
ter, not a historic building, not a historic structure, no obligations
on our part there, whatever, except under those circumstances to
mow the grass, it seemed like a pretty good idea for that to be dis-
tinguished from other national park holdings that have historic or
natural integrity. That is a very special case.
Mr. Frazer. Mr. Kennedy,
is
it true that you are an attorney?
Mr. Kennedy. Yes, sir.
Mr. Frazer. So could
I ask you a yes or no question and get a
yes or no answer?
Mr. Kennedy. Since
I am an attorney,
I doubt
it,
sir, but try
it.
Mr. Frazer. Did you oppose the taking of the Kennedy Center
last year out of the Park System? Did you, Mr. Kennedy, oppose
it?
Mr. Kennedy.
I did not oppose the
Mr. Frazer. Did you oppose it?
Mr. Faleomavaega. Let the gentleman respond, counsel.
Mr. Kennedy.
If I may. Counselor,
I did not oppose the move-
ment of the national performing arts center at the Kennedy Center
from
its ambiguous status, which
it was, partly managed by the
Park Service, partly managed by the Board, which, as you know,
as an attorney,
is represented by both Houses of Congress and a
large number of private citizens. There was no clear management
responsibility there, sir, as you know.
Mr. Faleomavaega. Would the gentleman yield?
Mr. Frazer. Yes.
Mr. Faleomavaega. This raises a very interesting point here to
Mr. Kennedy, and please don't think that we are trying to—here
is a classic example.
I am sure that States of the Union do not
have Offices of Territories under the jurisdiction of the Secretary
of the Interior.
Now, we have two subdivisions under the authority of the Sec-
retary of the Interior, one in terms of one having jurisdiction over
national parks, and the other one over policy of political develop-
ment as far as the Virgin Islands respecting the leadership of the
138
Virgin Islands, and seeing that here we have someone or a member
of the President's Cabinet just totally opposed, both as a matter of
policy, as well as not even having a national park,
to be worked
out on a mutual arrangement and still feel that if some kind of a.n
MOU or an agreement could be reached between the Secretary of
the
Interior and the Government of the Virgin
Islands, wouldn't
you think that this might be a better way to proceed, Mr. Kennedy,
than
Mr. Kennedy. Oh, an MOU, a mode of operating together in a
cooperative way, absolutely. That is what should have happened in
'52. It is a very desirable outcome. What isn't is the transfer of the
fundamental
authority and
responsibility. Of course, we
should
work this out. That is one of the reasons why my testimony, I hope,
is not very argumentative today.
I am not trying to pick at the
management of the Virgin Islands or discuss their financial capa-
bility or desire.
I don't think that is productive.
Mr. Faleomavaega. Well, my point here is that the Office of Ter-
ritories, in my opinion, now is deferred to the National Park Serv-
ice and say, "We want to keep our park, and the heck with the
opinions and the judgments of the leaders of the Virgin Islands."
And this
is where
I am seeing a conflict where who do we really
depend or look toward to for direction as a territory?
Mr. Kennedy. Well,
I try to be responsible for the National Park
System.
I can't speak for any broader responsibility than that. Mr.
Stayman may be able to.
Mr. Stayman. Yes.
I don't know what further
I can say. We see
our mission as trying to help the Federal Government manage
its
relationships with the islands. They really require people to follow
them on a day-by-day and week-by-week
action. We are not an
agency that has any capability to manage assets. We are primarily
a granting and policy office.
What the Park Service
is doing
is of a fundamentally
diff'erent
nature, and
it
is very appropriate that they do that. That
is the
way the government has been structured, and we support the posi-
tion of the Secretary and the President on this matter.
Mr. Faleomavaega. Maybe this
is also the sense of what
I am
trying to get
at, just a statement of the fact that
is
it my under-
standing that your office is the lead Federal agency advocating the
interest of the
territories before the Federal Government, or has
this changed as a matter of policy?
Mr.
Stayman. We
generally
find
ourselves
in
the
position
of
being the greatest advocate
for the interests of the islands. That
doesn't mean that we always support the position of the Island.
Mr. Faleomavaega. But you are the lead agency representing
the territories that look into the policy decisions affecting Federal
policies toward the territories?
Mr. Stayman. That would be a fair statement if you would limit
it to the relation between the Federal Government and the islands.
You know, that is a very broad brush.
Mr. Faleomavaega. Mr. Frazer.
Mr. Frazer. Mr. Kennedy or Mr. Stayman, does the Park Service
consider the economy or the well being of the people of any State
jurisdiction over which
it has whether
it
is a national park or any
property under its control?
139
Mr. Stayman.
I am sorry.
Mr. Kennedy.
I think I can respond to that question. The answer
to your question is yes.
Mr. Frazer. Are you aware of the fact that—and
I am not stray-
ing from the point because
it
is obvious from your testimony that
the National Park Service seems to make as a priority its interests
in
this property that we are speaking of as opposed
to what the
Governor has said.
The Governor has said it is part of an overall plan, and the issue
here
is economy. Nowhere does this
bill state that
it wants to
di-
vest the National Park System
of the
national
historic
site and
Christiansted. The bill doesn't say that, but somehow you are capa-
ble of reading that into
it. Are you aware that on the Island of St.
John there
is a place called Caneel Bay as a resort, Mr. Kennedy?
Mr. Kennedy. Yes.
Mr. Frazer. Do you realize that Caneel Bay
is the largest em-
ployer on the Island of St. John?
Mr. Kennedy. Yes. Excuse me.
I don't know what is the largest
employer.
Mr. Frazer. Well,
it
is. Do you recall me trying to get an exten-
sion for lease on Caneel Bay resorts so the bankers trust can take
it to market and you responding by saying the National Park Serv-
ice is primarily concerned with protecting the park, not necessarily
the economy of the local jurisdiction?
Mr. Kennedy. That was not my position, nor was that my state-
ment.
I
said—^you
are
speaking
of
a
private
conversation
be-
tween
Mr. Frazer. No, sir, written.
Mr. Kennedy. Written? Good. Then
I am quite sure what my re-
sponse was. My response was and
is that we have really three re-
sponsibilities.
First, there was a donor in that instance who had
very
specific conditions under which
this donation
to the Nation
was made and which created that property as an income generator
for the Island. Without that donation, there would have been no de-
velopment.
Second, the National Park Service has an obligation to stay with-
in
its statutory authority, which
is in that case statutory. And,
fi-
nally, of course we have an interest in the economic welfare of that
Island and continue to do that. That interest
is very intense, and
we are working at that.
Mr. Frazer. Mr. Kennedy,
it seems as though you have totally
disregarded the Governor's request or the
bill as
it relates to the
economy or the well being. Because
if you recognize that Caneel
Bay Plantation Resort
is the largest employer on the Island of St.
John, then you would recognize its importance to the economy.
If you are concerned about the people, then you would not oppose
an extension of the lease that would permit that plantation resort
to continue employing the largest number of people on that Island.
Would that be true?
Mr. Kennedy. No.
Mr. Frazer. It wouldn't be true?
Mr. Kennedy.
It would not be true that a position to adhere to
the law and to the terms of a gift
is in itself a statement that we
have no concern for the economic welfare of the Island. Those two
140
things are not the same. We do have an interest in the economic
welfare of the Island and take that very seriously. We also have
obligations under the law.
Mr. Frazer. Is there any evidence that you have in your position
that has not been proffered to this committee that the Government
of the Virgin
Islands
isn't capable
of managing that
site
in
St.
Croix?
Mr. Kennedy. Oh, we are now back to Christiansted?
Mr. Frazer. Yes, we are. You speak of divestiture and you speak
of—as Congressman Underwood read and Faleomavaega read,
in
your own testimony you spoke to the financial ability of the Virgin
Islands Government to manage the historic site in St. Croix.
I am
asking you is there any evidence that we are incapable of doing so?
Mr. Kennedy.
If you would
like us
to submit evidence to this
committee
indicating that the Virgin
Islands Government
is
not
taking care of the property currently under its custody to the same
degree that the National Park Service
is taking care of the prop-
erty under its custody, we could submit that to you, sir.
It
is not, however, my view that we should be here in the posi-
tion of attacking each other with respect to how well we are doing
our respective jobs. At least to the extent that the National Park
Service
is a presence there, we are going to be in the same town
together. And
I don't think that is a good idea so we are not going
to attack the government.
Mr. Faleomavaega. Without objection and certainly
I think
it
would be
great
for
the
edification
of the members
of the
Sub-
committee, please do submit the evidence
Mr. Kennedy. Sure.
Mr. Faleomavaega.—Mr. Kennedy, for the record in fairness to
you and your office. So we want to leave this open, as well as for
Governor Schneider and the Virgin
Islands Government
to have
their presentation of facts so that this will certainly be very helpful
to the members of the committee.
Mr. Kennedy. Thank you, sir.
Mr. Faleomavaega.
I thank the gentleman from the Virgin
Is-
lands. And the gentleman from Maryland.
Mr. Gilchrest.
I had a couple more questions. How many people
are employed by the Park Service on this particular historical site?
Mr. Kennedy. Twelve.
Mr. Gilchrest. Twelve?
Mr. Kennedy. Twelve permanents.
Mr. Gilchrest. Twelve permanents?
Mr. Kennedy. Yes.
Mr. Gilchrest. How many of those 12 permanents are from—is
this on St. Thomas?
Mr. Kennedy. It is on St. Croix.
Mr. Gilchrest. St. Croix?
Mr. Kennedy. Yes. We have a presence, as you know, on both
the other islands as well.
Mr. Gilchrest.
I went to Bluebeard's Castle in 1965 when I was
younger and in the Service—a great place. How many of the per-
manent employees on St. Croix at this historical site are from St.
Croix or are from the Virgin Islands?
141
Mr. Kennedy. The superintendent
is here, and he knows these
facts. So
if you don't mind,
I will just get him up here to answer
that question.
Mr. GiLCHREST. That is fme.
I do that all the time.
Mr. Kennedy. This
is Francis Peltier. He
is the superintendent.
How many, Francis?
Mr. Peltier. With the exception
of possibly two
people, every
employee is from the Virgin Islands—from that area.
Mr. GiLCHREST. Would they be retained as employees if the man-
agement were transferred to the Governor of the Virgin Islands?
Mr. Peltier. That
is hard for me to answer,
sir, since the Park
Service would no longer be in charge then.
Mr. GiLCHREST.
I am a strong advocate of the Park Service.
I am
a strong advocate of the idea of entrusting to the public entity our
historical traditions and whether it is a one-acre parcel or whether
it
is
the Yosemite
National Park
or
Glacier
National Park
or
Assateague in Maryland. But
I also think
if we are to retain the
essence of the Park Service and its idea, then I think it is time that
we reviewed how all of that works.
And
it also seems to me that if we have a very ardent, strident
backlash or very ardent, strident position to not releasing even the
smaller areas to an entity that could probably manage
it as sensi-
tively and as well because we think
it sets a bad precedent, then
the backlash to that will be like a huge gusher.
In other words,
I think unless we can find some ways of releas-
ing some of the areas to an entity, for example, like the Governor
of the Virgin Islands, that will in
all of my understanding protect
it as well as the U.S. Park Service protects
it, that
it does not set
a bad precedent for closing down parks in the United States.
But unless we can reach some type of reasonable agreement and
with these kind of things,
I think there will be, and may have al-
ready started, some troubling discussions about the Federal Gov-
ernment in general owning too much land. So
I think—not that
I
want
to
close parks, because
I
don't.
I
like Assateague National
Park in my
district.
It
is a beautiful place, and the Park Service
does a fine job.
But what I would like to see us do is to enter into a dialog where,
yes, some of these things are a possibility. Williamsburg in Virginia
is managed by the State of Virginia, and they do a superb, excel-
lent job. So
I would just sort of put my two cents into the discus-
sion.
And sort
of, in my judgment, for the purpose of preserving the
Park Service, we have to enter into these discussions with sort of
a new sense of alternatives to the conventional way that we have
been doing things for so long. Thank you very much, Mr. Chair-
man.
Mr. Faleomavaega. The gentleman from Michigan.
Mr. Kildee. Thank you, Mr. Chairman.
I apologize for arriving
late. As you well know,
I had four different markups or hearings
today. So at this time
I
will not ask any questions orally.
I may
submit some in writing. Thank you.
Mr. Faleomavaega. Thank you. And
I certainly would
like to
thank Mr. Kennedy for being here on the committee.
I look forward
to continuing working with the members of your office and hope-
142
fully that we will find a solution to the problems that we face be-
fore the committee.
I would like to call the witnesses now for our
first panel. Mr. Stayman,
I guess you have the honor of continuing
being there on the hot seat, and Ms. Wilma Lewis, the Interior In-
spector General.
Mr. Hastings. Mr. Chairman?
Mr. Faleomavaega. Before proceeding, we would like to give the
gentleman from Washington his statement.
Mr. Hastings. Thank you, Mr. Chairman. We
all have obliga-
tions, and
I have
obligations, but
I have a particular interest in
this next panel that is coming up to testify. And I would like to ask
unanimous consent to insert in the record
I guess
it is an editorial
in the Washington Times of October 10 talking about the Common-
wealth of the Northern Mariana Islands and the success they have
had. And so I would like to have that for the record.
Mr. Faleomavaega. Without objection.
[Editorial may be found at the end of hearing.]
Mr. Hastings. And
I also would like to submit for the record a
statement that
I have regarding some of the discussion regarding
the minimum wage in that area.
Mr. Faleomavaega. Without objection.
[Prepared statement of Hon. Doc Hastings follows:]
Statement of Hon. Doc Hastings
Mr. Chairman. The subcommittee
is meeting today to discuss issues relating to
the Commonwealth of the Northern Mariana
Islands. The Commonwealth
is the
U.S.
territory over 5,000 miles from my state that,
for the past 16 years, has en-
joyed sustained economic growth. The Commonwealth has weaned itself of most of
its federal dependency and
is moving in the right direction toward self-sufficiency.
However, the Clinton Administration proposes to federalize the minimum wage in
the Commonwealth. In the Department of Interior's report. The Federal-CNMI Ini-
tiative
on
Labor,
Immigration,
and Law
Enforcement,
the
Administration
rec-
ommends that the Congress mandate an annual 30-cent increase in the Common-
wealth's minimum wage until it reaches federal standards. This federalization of the
minimum wage threatens the economic balance in the Commonwealth.
'The minimum wage in the Commonwealth is an issue best left to the local govern-
ment.
It is impossible for Washington to micromanage the delicate economic affairs
of the Commonwealth. This says nothing of the fact that the United States govern-
ment
expressly
exempted
the Commonwealth
from
federalized minimum wage
standards under its governing Covenant with the U.S. The Covenant specifically ex-
empted the Commonwealth from the minimum wage because
it recognized imposi-
tion of U.S. minimum wage laws wovild cause substantial harm
to the Common-
wealth. We should honor ovu* commitment to the Covenant.
The Commonwealth has undergone an extraordinary transformation
since
the
signing of the Covenant agreement, but the fact still remains that a federalized min-
imum wage could crush its fragile economy.
It would result in the loss of jobs and
businesses in the Commonwealth.
It would suddenly halt the Commonwealth's eco-
nomic growth.
It could even result in an increase in the Commonwealth's reUance
on federal funds.
To address the minimum wage
issue,
the Commonwealth has commissioned a
comprehensive and independent evaluation of the impact of the minimum wage on
the economy
of the Commonwealth. This approach allows the Commonwealth
to
give significant consideration to its local economic needs, and develop sound poUcies
that do not cause substantial harm to the economy.
This Congress has debated increasing the minimum wage in the United States,
and it will continue to debate the issue. EarUer this year,
I opposed attempts to in-
crease the minimum wage in this country and have serious concerns about efforts
to do this in the Commonwealth of the Northern Mariana Islands. The minimum
wage issue can
be, and
is being, dealt with more appropriately by the Common-
wealth, and in a way that does not jeopardize its economy. Greater thought and con-
sideration must be given to the economic success story in the Marianas before this
Congress votes
to mandate a
federal minimvun wage
increase
for the Common-
143
wealth.
I thank the Chairman for providing this opportunity to discuss this issue
and look forward to hearing this afternoon's testimony.
Mr. Hastings. And also some questions to be asked of those that
are going to testify today and ask that the questions be forwarded
to them so that they can respond in writing.
Mr. Faleomavaega. Without objection.
Mr. Hastings. Thank you.
Mr. Faleomavaega. Ms. Wilma Lewis is with us too?
Ms. Lewis. Yes, I am.
Mr. Faleomavaega. All right. Mr. Stayman, do you want to pro-
ceed?
STATEMENT OF ALLEN P. STAYMAN, DIRECTOR, OFFICE OF
INSULAR AFFAIRS; ACCOMPANIED BY WILMA LEWIS, INTE-
RIOR INSPECTOR GENERAL
Mr. Stayman. Thank you, Mr. Chairman.
I would quickly like
Mr. Faleomavaega. Could you stay a
little closer to the mike?
Mr. Stayman. Certainly.
Mr. Faleomavaega.
I am hard of hearing.
Mr. Stayman. The invitation requested that there be representa-
tives from the Department of Justice, Labor, and INS. So we have
Mr. Waxman here from the Department of Justice, Mr. Hurst from
INS, and Mr. John Frazer from the Department of Labor.
Mr. Faleomavaega. Our good friends for the territories.
Mr. Stayman. OK.
I already gave part of my statement with re-
spect to the 3634.
I would ask that my entire statement be put in
the record, Mr. Chairman.
Mr. Faleomavaega. Without objection.
Mr. Stayman, And
I will summarize the section with respect to
a second annual report on the CNMI Labor, Immigration, and Law
Enforcement
Initiative. The Federal-CNMI
Initiative was funded
with a $7
million
appropriation by
the Congress
in Public Law
103—332.
The Administration issued its second annual report on the initia-
tive on June 4 of this year. We believe that the 10-page report with
executive summary and recommendations brings the reader up to
date on programs in the CNMI.
In our report, we note that the combined efforts of the Govern-
ment of the Commonwealth of the Northern Mariana Islands and
Federal agencies are making progress in fulfilling the goals of the
initiative. Governor Tenorio has strongly endorsed the CNMI's ac-
tions and the increase in Federal law enforcement presence.
The Federal agencies and the CNMI are working cooperatively,
with the Office of Insular Affairs acting as an ombudsman, to fash-
ion appropriate responses to the consequences of enormous growth
in
the CNMI. However,
sustained
follow-through from both
the
local and Federal Governments
is needed
if initiative goals are to
be achieved.
I would like to highlight for the committee the recommendations
contained in the report. First, that Congress finalize enactment of
Section 2 of S. 638 to establish the minimum wage in Federal law
including the annual 30-cent increases in the minimum wage con-
tained, till very recently, in CNMI law. And, two, that Congress di-
144
rect the CNMI to utilize Covenant funds for prison and detention
facilities.
On minimum wage, CNMI workers at present lack Federal mini-
mum wage
protection,
with
the
result
that
the Department
of
Labor
is limited
to enforcing only the overtime provisions of the
Fair Labor Standards Act.
S.
638, which passed the U.S. Senate
and
is
before
this Subcommittee
for
action,
anticipated
possible
CNMI backsliding on the minimum wage issue and incorporated
CNMFs annual 30-cent increases. Despite this congressional action,
however, the CNMI wage policy continues to vacillate.
S. 638 would bring fairness and
stability
to CNMI wage rates
and important new revenue to the local government. The 30-cent
increases were enacted by the CNMI Government and continue to
be endorsed by the CNMI Chamber of Commerce, the Contractors
Association, and the Hotel Association.
The only opposition is from the garment industry, which, despite
its claims of hardship, continues to expand. New companies have
been granted licenses and production continues to
soar. Garment
imports from the CNMI increased 30 percent in 1995 and rose over
40 percent in the
first two months of 1996 over the same period
last year.
Other American
Pacific jurisdictions, Hawaii and Guam, have
prospered for decades while paying minimum wages either equal to
or higher than the Federal minimum wage. The CNMI can simi-
larly prosper. We need not resort to the costly bureaucratic mecha-
nism of a Federal wage board.
I will stop right there. You have my
full statement. And the panel would be happy to answer any ques-
tions you may have.
Mr. Faleomavaega. Thank you, Mr. Stayman. Ms. Lewis.
STATEMENT OF WILMA A, LEWIS
Ms. Lewis. Mr. Chairman and members of the Subcommittee,
I
was actually invited to appear here today to testify regarding our
audit activities on the CNMI. The Office of Inspector General is an
active participant in the CNMI Federal Task Force and, by all indi-
cations, a very productive participant as well. Would you like me
to proceed with respect to the audit activities at this time, or would
you prefer to hear from
Mr. Faleomavaega. No. Please, by all means, proceed.
Ms. Lewis. Thank you very much.
I was asked to include in my
testimony
today a
discussion
of our
audit
activities
during
the
course of the past three years;
in particular, our recent audit on
the management of public land issued in March of this year and
testimony regarding the response and constructive actions, or lack
thereof, by the Commonwealth to resolve issues raised in our audit
reports.
I should also mention, Mr. Chairman, that
I was informed that
I may be asked questions pertaining to certain ongoing disputes re-
garding property interests on Water Island in the U.S. Virgin
Is-
lands.
I have decided to recuse myself from that matter because prior
to my current position as the Inspector General, I served as the As-
sociate
Solicitor
for the Division
of General Law
in the Depart-
ment's Office of the
Solicitor. During my tenure as the Associate
145
Solicitor, staff whom
I supervised, in conjunction with the Depart-
ment of Justice, represented the Department in Utigation involving
Water Island.
Therefore,
in order to protect the
integrity of my position and
that of the Office of Inspector General,
I have decided to delegate
all decisionmaking responsibility regarding any Office of Inspector
General involvement in Water Island to the second in command in
the ofRce, the Chief of Staff and General Counsel, Richard Reback.
So I would ask if there are any questions with respect to Water Is-
land, that they be directed to Mr. Reback.
Mr. GiLCHREST. Mr. Chairman, could
I interrupt just for a sec-
ond?
Mr. Faleomavaega. Please, by all means.
Mr. GiLCHREST. Where is Mr. Reback?
Ms. Lewis. Mr. Reback
Mr. GiLCHREST. He is in the building?
Ms. Lewis. Yes, he is.
Mr. GiLCHREST. So we could ask him during the course of this
hearing those questions dealing with Water Island?
Ms. Lewis. Yes. He
will be addressing any questions that the
Subcommittee may have with respect to Water Island.
Mr. GiLCHREST. And if we don't, like
I can't stay here much past
quarter to four.
I could give Mr. Reback the questions, and he could
respond to us at a later date?
Ms. Lewis. Yes. That is correct.
Mr. GiLCHREST. Mr. Chairman,
I would like at this time to ask
unanimous consent to submit
Mr. Faleomavaega. Without objection.
Mr.
GiLCHREST. [Cont.]—for
the
record
the
series
of questions
that we have. Thank you.
[Water Island questions for the Inspector General follow:]
Questions for Wilma Lewis, Inspector General
The disposal of Water Island has been identified as an oversight priority of the
Committee at the beginning of the 104th Congress.
I have been sent copies of com-
munications by at least one Water Island lessee to your office regarding the han-
dling of the existing lease arrangements with the sublessees of Water Island and
the process of negotiating contracts for the purchase of the
lots on Water Island.
I have a number of questions.
•
What
is the amount of annual lease rent that are being collected by the De-
partment from each lessee? Is this amount being collected from all of the sublessees,
including those in Sprat Bay [who are at times referred to as sub-sub-lessees]? Did
this requirement to collect rent end or change at the expiration of the 40 year lease?
Are these funds being properly collected and accounted for?
•
What management
practices have
attributed
to
the
delay
in
resolving the
transfer of title to Water Island properties?
•
The Environmental Impact Statement was issued in May
1996. Why wasn't
this initiated after the 1992 expiration of the lease?
•
The Department's position regarding the possessory interest of the hotel prop-
erty was not upheld in Federal Court, and the issue
is
still unresolved. What was
the Department's position on the value of the possessory interest to the hotel and
what was the ruling of the Court?
•
The judgement of the Department has cost the Federal Government millions
of dollars and has deprived many citizens of their right to enjoy the use of their
property, and has created an incredible level of stress and anxiety as citizens are
forced to battle with the Federal Bureaucracy for fair, equitable, and timely settle-
ment of their property rights. The Department is urged to take whatever steps are
necessary to expeditiously conclude the disposal of Water Island and transfer title
accordingly to those lessees seeking to purchase their property.
146
•
What is the total aggregate loss of revenues identified in your statement about
nine audit reports?
I.G. QUESTIONS REGARDING THE AUDITS IN THE NMI
•
When the audit was issued regarding the mismanagement of public lands in
the NMI, approximately $700 million in lost revenue was sited. Based on the late
response by the Governor of the NMI, what do you now estimate the total in lost
revenue?
•
What other audits have been conducted in the last three years and what costs
or loss of revenues have you identified? Have there been timely replies to the au-
dits? What percentage of I.G. recommendations have been implemented?
•
There have been reports of misuse of government funds by officials in different
segments of the NMI Government. What steps do you recommend
to insure the
proper and adequate accounting of public funds in the NMI?
Mr. FAI.EOMAVAEGA. And you will direct it to Mr. Reback?
Mr. GiLCHREST.
I would like them to be in the record, as well as
directing them to Mr. Reback.
Mr. Faleomavaega. That is fine.
Mr. GiLCHREST. Thank you.
Ms. Lewis. Turning then to our audit activities, during the past
three years, we have issued nine audit reports, which have covered
a wide array of issues pertaining to the Commonwealth's efforts to
develop and effectively implement policies, procedures, and controls
related to public land, financial management, and program oper-
ations.
While some progress has been made over the years, the results
of our audits have clearly shown that the Commonwealth has paid
insufficient attention
to matters
relating to opportunities
for,
in-
creasing revenues and collections on the one hand, and, reducing
expenditures and operating costs on the other. These lost opportu-
nities have cost the Commonwealth millions of dollars in foregone
or uncollected revenues and
in unnecessary
or inappropriate
ex-
penditures.
Let me
discuss the
public land
audit that we
recently
issued
since that was one of the audits that was specifically mentioned in
my
invitation.
With
respect
to
that
audit, we
addressed
three
areas: land exchanges, lease management, and homestead adminis-
tration. In each of these areas, we found significant problems.
With
respect
to land
exchanges,
the Commonwealth
routinely
failed
to
use
current
appraisals
in
valuing
the
land
to
be
ex-
changed. They failed to exchange land of comparable value; thus,
public land was exchanged for private land of lesser value.
The public land was undervalued, and the private land was over-
valued. Based on our review, we determined that the Common-
wealth lost public land valued at $118.4 million and would lose ad-
ditional land valued at $70.1 million if pending exchanges are com-
pleted.
In addition to using outdated appraisals, we found that the Com-
monwealth
lost potential
lease revenues
in the amount of $25.1
million on exchanged public land that was leased to a developer by
private landowners.
In other words, the Commonwealth did not consider the revenue
that
could be
realized from
the commercial development
of ex-
changed public land. The
total
losses
identified
in
this one area
147
alone, that is the value of land exchanged or to be exchanged and
lost potential lease revenues, were over $200 million.
In the area of lease management, the actual and potential losses
identified totaled approximately $470 million. About half a million
dollars was
in
lost rental on a couple
of the
leases that we
re-
viewed, and the potential loss of another approximately $465.7 mil-
lion over the unexpired terms of six leases that we reviewed.
This resulted from the Commonwealth's
failure
to ensure that
the minimum lease rental pa3mients were based on the appraised
fair market value of the property, and their failure to have gross
receipt rental payments, and interest on past-due rentals properly
assessed. In addition, lease rental payments were not collected in
a timely fashion, and default was not pursued in a timely fashion.
We had, for example, some indications from our audit that public
land leased by the Commonwealth for 25 years was leased for a
minimum rental payment of approximately $152,000. Seven days
later, the lessee sublet that property for $720,000 over a 25-year
lease. Similarly, there was a 25-year lease by the Commonwealth
for approximately $18.7 million, while the fair market value of the
minimum rental payment should have been more in the vicinity of
$262 million.
Finally, in the area of homestead administration, we found that
from 1985 through 1994, 208 homestead recipients improperly re-
ceived a total of $7 million from the unauthorized sale or lease of
their homestead
lot. On a
site
visit, we found indications of com-
mercial development on the lots, apartment buildings, office build-
ings, restaurants, grocery stores, and so forth.
The Commonwealth did not respond to the draft report that we
issued. Following the issuance of the final report, we received a re-
sponse from the Commonwealth that we found very inadequate, es-
pecially in view of the millions of dollars at stake.
When we evaluate a response
to an audit
report, we look
for
three things: a plan of action, a projected timeframe within which
the action plan would be completed, and the identification of a re-
sponsible
official. The Commonwealth's response was
deficient in
all of these respects. Their response was very indefinite and non-
committal with respect
to
actions that would be taken
to imple-
ment the recommendations. They failed in certain instances to ad-
dress
the
root
causes
of the problems
as
identified
in
the
rec-
ommendations. And they failed to present any strategy for dealing
with certain tough resource issues that have a bearing on the im-
plementation of the recommendations. Based on their response, we
considered
six of the seven recommendations unresolved; that
is,
there was either a failure to agree with or to adequately address
the recommendations.
I can lump the remaining eight audit reports that we did during
the past three years into basically three categories: revenue assess-
ment
and
collection,
expenditure
control,
and
general
financial
management and program operations. We have focused on these
areas over the years because of the persistent problems that our
audits have revealed.
In the area of revenue assessment and collection, we conducted
two tax audits in which we concluded that the Commonwealth lost
millions of dollars
in tax revenues from the period October 1990
148
through December 1993. There were deficiencies in the auditing of
tax returns and the imposition of tax penalties; in the investigation
of potential criminal violations of the tax laws; and in the collection
process.
In
addition, we concluded that from
fiscal years 1991 through
1993, the tax system didn't produce sufficient revenues to fund gov-
ernmental operations and Federal obligations and was in need of
revision. We found a similar problem with the Commonwealth Util-
ities Corporation, which, due to a rate structure that was insuffi-
cient to meet its needs, defaulted on contractual obligations, total-
ing over $92.8 million for fiscal years 1988 through 1993.
In the area of expenditure control, we conducted an audit of con-
tracting and contract administration for the Commonwealth Utili-
ties Corporation
for
fiscal years
1989 through 1993 and found a
number
of
deficiencies—acceptance
of
unsubstantiated
contract
claims; purchases of goods and services totaling about $16.6 million
without competition; the expenditure of hundreds of thousands of
dollars,
for consulting services that were not necessary; and con-
struction projects that were not completed. So there were a number
of problems that we found in the area of expenditure control.
Finally,
in the area of general financial management and pro-
gram operations, we conducted three follow-up audits on the Cap-
ital Development Funds and the Economic Development Loan Fund
to determine whether recommendations made in prior audit reports
had been implemented. These recommendations that had been pre-
viously made were
designed
to
address problems
related
to
ac-
counting and control of Federal funds provided for capital improve-
ment and economic development, and the effective and efficient op-
eration
of the
respective
programs. We
found
that
of 30
rec-
ommendations made
to
the Commonwealth,
27 were
not
imple-
mented fully or effectively.
During the past three years, our audits have resulted in 63 rec-
ommendations, 54 of which were directed
to the Commonwealth,
and the remaining nine to the Office of Insular Affairs. The Com-
monwealth has reported that 36 of the 54 recommendations have
been implemented and that nine of the remaining 18 have been re-
solved.
(In other words, there has been concurrence with the rec-
ommendations.)
Our experience, however, has demonstrated that it is not always
the case that recommendations reported as implemented have, in
fact, been implemented fully and effectively. As such, we would be
unable to comment on whether or not there has been actual imple-
mentation in the absence of follow-up audits.
As indicated
in one of our audits that we did during the past
three years—the audit on the status of improvements—^the Com-
monwealth has made some improvements in the areas of financial
management, expenditure control, revenue collection and program
operations over the years. However, improvement on a much broad-
er scale and of a much greater magnitude is necessary.
The Office of Inspector General is committed to continuing its ef-
forts to pursue an audit strategy designed to identify the major and
persistent problem areas and to make recommendations intended
to address those problems. Our efforts, together with a real com-
mitment from
the Commonwealth government
in
implementing
149
audit recommendations and the focusing of assistance from the Of-
fice of Insular Affairs in identified problem areas, should go a long
way toward helping to alleviate the problems.
Finally, we are encouraged by this Subcommittee s
interest m
our audit activities in the Commonwealth. The Department of the
Interior does not have the same level of authority or influence in
the insular areas as
it does with the Department's offices and bu-
reaus to ensure that audit recommendations are resolved properly
and implemented fully and effectively. Accordingly, we believe that
periodic oversight hearings of this nature would serve the useful
purpose of encouraging resolution and implementation of audit rec-
ommendations in the insular areas.
,
,
,
•
I request that a copy of my full written testimony be placed m
the record. Thank you for the opportunity to testify, and
I would
be happy to respond to any questions that the Subcommittee may
have
[Prepared statement of Ms. Wilma A. Lewis may be found at the
end of hearing.]
,,
.
.
^
Mr.
Faleomavaega. Thank
you,
Ms.
Lewis,
for
a
very com-
prehensive statement.
I would like to know if the other gentlemen
and members of the panel also would have statements that they
would like to present before the Subcommittee. Or maybe at a later
point
in
tim.e
that you may want
to submit statements
for the
record, you are certainly welcome to do so.
Mr. Waxman.
Sir, just speaking from the Justice Department,
the Chairman's letter inviting Mr. Stayman to come testify asked
that he provide testimony but bring us to answer questions. We are
happy
to
try and answer any questions you have either here or
questions you may submit in writing later on. But we don't have
any affirmative testimony to offer. We did contribute those portions
that are attributed to our respective agencies, both to the 1995 and
the 1996 report of the Task Force on CNMI.
Mr. Faleomavaega.
All
right. The gentleman from Maryland,
questions?
Mr. GiLCHREST. Mr. Chairman,
I have one quick question to the
gentlelady that just spoke.
Is there an aggregate number for the
losses that you have illustrated in your statement? Do you have the
total amount?
Ms. Lewis.
If one were to add up
all of the losses that we
ref-
erenced in our audit report on the public lands, is that correct?
Mr. GiLCHREST. Yes.
Ms. Lewis. It would come to about $670 million.
Mr. GiLCHREST. That is over what period of time?
Ms. Lewis. If I could, let me just inquire from the Assistant IG
for Audits.
Mr. GiLCHREST. So something
is not done—^the figure that you
just read to us, what was it—$600 million?
Ms. Lewis. In the vicinity of $670 million has the Assistant IG
for Audits indicated, in the context of the discussion of lease man-
agement, the leases were generally for 25-year periods of time. So
we looked
to see what the
loss would be over the course of the
163.S6S
It was approximately $470 million, half a million of which had
already been lost, and an additional $465.7 million which would be
150
lost over the unexpired term of the leases; so that would be over
the course of the 25-year period of time.
Mr. GiLCHREST. And at this point, there is a program in place to
prevent that from happening?
Ms. Lewis. Well,
I do not believe that there
is such a program
in place. As I indicated, we got a response from the Governor of the
Commonwealth that, in our view, was not adequate to address the
types of problems that we have identified.
For example, there was an indication in the response that new
regulations had been issued in this area. But one of the main
is-
sues with respect to the exchange of land, for example,
is the ab-
sence of current appraisals.
One of the areas in which
it was indicated in the response that
they want to maintain
flexibility
is precisely in that area. There
was an indication that there would be no strict requirement as to
how current the appraisal has to be. Well, therein lies a large part
of the problem because we found, for example, where there might
have been
1992
appraisals,
1990 or 1991 appraisals might have
been used, which were very different from the more current ap-
praisals. So
I can't say that there
is a program in place, at least
as we have been informed.
Mr. GiLCHREST. But you are saying that
if nothing
is done, we
are going to lose about $600 million?
Ms. Lewis. That is correct. Now, let me make sure I clarify that.
That includes value of land lost as well.
Mr. GiLCHREST. Right.
Ms. Lewis. Yes. That is correct.
Mr. GiLCHREST. So are you making a recommendation as to what
this Subcommittee should do as far as oversight, or can you give
us any recommendations that we could develop legislation to help
resolve these problems?
Ms. Lewis. Well, we received the response from the governor
I
believe
it was at the end of May. And usually what we do when
we receive a response that we find unresponsive
is we try to give
an additional period of time, say, 30 days, to work with the particu-
lar audited
to see
if there can be more progress with respect
to
those matters.
We have not done that at this point.
I would hope that we could
get a more responsive answer from the governor, but failing that,
then
it would really be up to some other entity like this Congress
to try to encourage those with the responsibility in the Common-
wealth to do something about the problems.
The response that we received
insufficient resources
to do the
type of monitoring that we recommended. And, obviously, we are
sjrmpathetic to the fact that resources are scarce.
They are scarce
all over, but the problem that we had with the
response is that it did not provide for us any indication of a plan
some sort of a strategy that, notwithstanding the
insufficient
re-
sources, some steps would be taken to try to address the problem,
the response was more of the nature that, "Well, we will go as far
as we can go with what we have, but we don't expect to go very
far." And we found that kind of response to be insufficient.
151
Mr
GiLCHREST. Well, thank you very much. We would
like
to
work with you and the Commonwealth to help find some solution
to this. Thank you, Mr. Chairman.
Ms. Lewis. We would be happy to do that.
Mr
Faleomavaega. You know, as an observation, Ms. Lewis—
and
i certainly commend you and the members of your
staff for
doing a very comprehensive work as far as auditing of the North-
ern Marianas Government and its resources.
And
I sincerely hope that with the same gusto and every effort
the fact that the Congress has expended over $20 million
in the
last four years in trying to get the Secretary of the Interior or the
Interior Department to properly audit an account for some $2
bil-
lion in Indian Trust Funds that we have no idea what has hap-
pened to these funds that belong to the Native Americans.
And
I make
this comparative observation
in passing—the
fact
that we do have a responsibility to some 2 million Native Ameri-
cans
in our country and
certainly the
responsibility
of the
Sec-
retary of the Interior. As
I recall, you know, the Covenant that was
passed by the Congress
in
this
relationship with
the Common-
wealth has only been in existence for 20 years.
And I hope that there is a sense of sensitivity also, and I am not
making any excuses for the leaders of the Commonwealth of the
Northern Marianas
for whatever their
inabilities may be
in not
being able to come up with the goods,
so to speak, with the
rec-
ommendations and some of the suggestions that have been made
over the process of conducting these audits.
But
I just wanted to put
it in perspective that
it has only been
in the past 20 years that the Northern Mariana Government has
been in existence. And as you had said
earlier, they have limited
resources. There are political turmoils, the ups and downs of get-
ting
elected, whether
it be
for governor or other
offices, and
so
things have not necessarily been consistent in terms of policies and
the fact that they have had now about four or five governors within
the span of the last 20 years, which means different policies,
dif-
ferent people in place in government, and the responsibilities that
they bear.
i
,
..
I say this so that
it doesn't get to the point where we look at
NMI with only 45,000 people in this Commonwealth.
I wish that
perhaps the IG could do the same thing in the auditing of the Con-
gress. And as you may well have known, an attempt was made,
and we can't even keep an accounting of our own records even here
in this very institution.
I would like to see the IG also do an auditing of the billions
ot
dollars that are being spent in the State of California perhaps and
see what deficiencies there may be.
It is so easy for us to pinpoint
and saying the needs of 45,000 people, but when you compare that
with 33 million people in the State of California, then things get
a little fuzzy.
And
I commend you for the work that you are doing, and
I am
sure that our witnesses or friends from the NMI will respond to the
concerns that your
office has pointed out in your testimony. And
I would like to clear this for the record again, Ms. Lewis. You are
saying that the aggregate revenue losses of the NMI has been or
152
will be for the period of a 25 year lease period is in excess of $670
million?
Ms. Lewis. That is correct.
Mr. Faleomavaega. Of lost revenues?
Ms. Lewis. Yes.
I should add that the total would be based on
the numbers that
I have given you, approximately $677 million.
I
mentioned to you that individuals who had homestead leases had
improperly used their leases and had, we believe, built commercial
and other types of inappropriate things on the property. That was
valued at $7 million. So that is not really a loss that one might con-
sider in the context that you are raising the question, but rather,
an improper use.
Maybe the Commonwealth might be able to go after those indi-
viduals. That is a question that they have referred to the Attorney
General to determine whether or not they would be able to do that.
So
it
is questionable with respect to whether they could get that
$7 million. Excluding that, it would be about $670 million.
Mr. Faleomavaega. What basically
is the annual budget of the
NMI currently?
Ms. Lewis.
I am not aware of the what the annual budget is.
It's
$220 million I understand.
Mr. Faleomavaega. 220?
Ms. Lewis. Yes.
Mr. Faleomavaega. Total budget. How much of that is local rev-
enues? 90 percent?
I am sorry. Did 1—90 percent of the $220 mil-
lion budget is locally obtained—local revenues per se. OK. All right.
You indicated, Ms. Lewis, that some 30 recommendations as part
of the audit report process, and 27 were never implemented or com-
plied with. Can you give us an idea why they were not responded
to?
Ms. Lewis. As
I
indicated, when we do the audit reports, the
auditee can agree with the recommendations, which
is considered
resolution. Then there is implementation. We get information from
the auditee indicating that they have a plan of action to implement
and that they have implemented that plan. We take that at face
value. We wouldn't know for sure whether or not the implementa-
tion has taken place unless we do a follow-up audit and go in and
evaluate the actions taken.
With respect to why the 27 out of the 30 recommendations were
not fully and effectively implemented,
I do not have an answer for
that. That is what our audit report found, however.
Mr. Faleomavaega. Mr. Stayman, you have indicated that one
of the basic recommendations that the Interior Department is now
submitting is made part now of Senate Bill 638, to establish a min-
imum wage and Federal law for the CNMI.
You know, three or four years ago,
I had recommended to the
previous Governor of CNMI—currently probably American Samoa
is the only jurisdiction under Federal labor laws that has this in-
dustrious committee established every two-year period by the Fed-
eral Department of Labor, and in doing so conduct an evaluation
with representations from both management, as well as from labor
and local leaders, and in the process make recommendations as to
the minimum wage for American Samoa, which
is below the Fed-
eral minimum standards.
153
And
I was just wondering if the Department of Interior had an
opportunity to examine that possible option, assummg that the eco-
nomic situation in NMI
is not up to standard with the Federal or
U S
standards? Have you had a chance to examme that option.'
Mr
Stayman. Yes. Let me step back. This recommendation
is
not a new one.
It was made
in our report over a year ago, and
based upon that recommendation, the U.S. Senate did move legisla-
tion
I think nearly a year ago, which has been pending betore this
Subcommittee.
t
i.u-
i
^.i.
Let me just say something real quickly, and then
1 think tne rep-
resentative from the Department of Labor can give a more detailed
answer. We believe that the economies of Samoa and CNMi are
fundamentally different.
,
i u
u
^
And a more appropriate analogy or comparison would be between
Guam and the CNMI. And history shows that Guam can support
a minimum wage, and they have a pretty vibrant economy there.
In addition, the Chamber of Commerce of the CNMI supports the
minimum wage.
^ .,„
,
^
.1
Finally, the Government of the CNMI has for the past two years
supported this same proposal. It has only been really m the course
of the last six months that there has been a falling back from that
position. It is unfortunate that we are in this position.
We are confronting a lot of problems in the CNMI, and minimum
wage was one of the things that we thought—you know, using the
vernacular,
it was a no-brainer. Everybody agreed to
it.
It would
have positive effects in the immigration and labor areas where we
were trying to come up with policies to mitigate the problems.
But we find ourselves now
essentially backtracking to pick up
what we think was
a
relatively simple and
positive
action that
could be taken that would help contribute
to the solution of the
range of problems there. Having said that,
I think the real expert
is the Department of Labor so I will defer to them.
Mr. Frazer. Mr. Faleomavaega,
if
I could just add a
little
bit.
You started the question by asking if we had evaluated the indus-
try committee process.
It
is, in fact, only in American Samoa that
operates and
is among the options that we looked at for this rec-
ommendation last year—was that model—that industry committee
model.
/•
1.
.1
J.
J.U
Allen has indicated many of the reasons why we felt that the rec-
ommendation we made was a superior one. Maybe
it would help if
I could outline briefly some of the reasons that led us away from
using
or recommending
the
industry
committee
model
for
the
Northern Marianas.
First of all,
it is, as you know, not a predictable transparent proc-
ess. It is a process that every two years requires an economic study
and the convening of a committee, and
it, in that regard,
is some-
what
susceptible
to
special
interest coming
to bear
in American
Samoa with the tuna canneries and government being the predomi-
nant employers.
It is a manageable process, but that is quite a dif-
ferent situation in the Northern Marianas.
Another particular problem that we are concerned about
is that
you can get, as you know, in American Samoa different minimum
wage rates for different industry sectors, and that leads to, in some
cases—can lead to competitive imbalances in terms of competition
154
for the labor market. And in an economy like the Northern Mari-
anas that has become so dependent on foreign workers, that could
have a really distorting effect in the economies.
And, most importantly,
I think from a perspective of interest to
us
all, the industry committee process
is expensive. Our estimate
for the—if it were to be applied in the Northern Marianas would
be that
it would cost about three-quarters of a million dollars to
carry that out every two years. That
is a huge cost for a process
to go through to try to look at industry by industry what a mini-
mum wage change should be.
So we looked very carefully at that as an option and decided
it
was not the best option given where the Commonwealth was at the
time and where there seemed to be support in the Commonwealth
for how to implement and Federalize the minimum wage. And that
is what underlies our recommendation.
Mr. Faleomavaega.
Mr. Chairman,
I know
I have taken
too
much time.
I would certainly like to turn the Chair back to you,
and
the
gentlemen
from Guam
and Michigan
have
not had
a
chance to
Mr. Gallegly. [presiding] Thank you very much for taking over
while we went over to vote.
I assume that our relationship with
American Samoa has not changed since I left so, Mr. Kildee.
Mr. Kildee. Thank you very much, Mr. Chairman. We granted
statehood to American Samoa while you were gone.
I would like to
ask a question to Ms. Lewis.
I am looking more for corrective ac-
tion
rather than
punitive
action. What
remedies
or procedures
should be put in place to assure that revenues are not lost and that
proper purchasing procedures are followed in the Northern Mari-
anas?
Ms. Lewis. One of the main things that we discussed was the
issue of current appraisals as
I mentioned before.
I think that the
failure to use current appraisals has created a large problem with
the
land
exchange
program. That
is
one
of the
areas
that we
touched on that we didn't think was adequately addressed.
The other thing is that there seems to be some sort of a problem
with respect to actual collection and pursuing collections of lease
pa3rments—going after defaulted entities with respect to lease pay-
ments or timely payments. The collection process seems not to be
working as well as it should.
The issue of training personnel comes up and the need to train,
although they have indicated
in the past that they have started
training programs, which I think is a positive step. But that is one
area that I think some help would be beneficial.
Mr. Kildee. Do you think that the—I could probably ask the Act-
ing Attorney General when he gets up here—^that the Government
of Northern Marianas might welcome some training?
I know tax
revenue
is not the easiest part of our legislation. The tax code
is
not the most simple part of legislation. Do you think that the Fed-
eral Government here
at the request
of the Government
of the
Northern Mariana Islands might offer some type of training in col-
lection of revenue?
Ms. Lewis.
I believe that Mr. Stayman indicated that there
is a
program that his office offers that he might be able to address.
^
155
Mr. Stayman. In my office, Mr. Congressman, there
is a series
of programs which we lumped together and called Technical Assist-
ance Programs, and they are funded several million dollars annu-
ally. One of those subprograms
is called the Management Control
Initiative, and
it
is a pot of money to which heads of government
may apply to assist the government in developing their financial
management capabilities.
In addition
to purchasing and training people on
specific com-
puter systems and
financial
software, we
also
regularly provide
technical assistance from the Federal IRS.
It
is a program which
is
available
to
all
States and
municipalities, but because
of the
costs and sometimes the lack of a training funding available in the
islands, we underwrite that. And, in fact, just on Fridpy I did meet
with the Director of Finance from the CNMI regarding their inter-
est in these programs.
Mr. KiLDEE.
I would be interested
in pursuing this further by
looking at some corrective action because
I am sure the Govern-
ment of the Northern Marianas would prefer to be collecting more
of these revenues.
It would be very, very helpful so anything that
you might in writing furnish the committee later on how we as a
committee might proceed to try to find some corrective action for
this would be very helpful. Thank you, Mr. Chairman.
Ms. Lewis. If I could just add for a moment, written policies and
procedures was another area that we found lacking and
it
is pos-
sible that with written policies and procedures in place, this situa-
tion could improve.
The written policies and procedures would address issues, for ex-
ample, about the minimum lease rental payments, where we found
that
in many
instances,
the value
of the
property was
not
ap-
praised at the fair market value. Therefore, you had the situation
where minimum lease pa3anents were a
lot less than they really
should have been.
There is some indication that the way they have leased the prop-
erty in the past
is to take eight percent of the fair market value
to compute the lease. But that
is not something that
is done on a
formal basis.
It is very informal,
I think, as the Governor has also
acknowledged.
So
if there are some written
policies and procedures that
are
going to be put into place, this would provide guidance in terms of
how to compute rental pajrments, for example. Gross receipts pay-
ments—that is another rental payment that is supposed to come in
over and above the minimum rental payment. For gross receipts re-
ceived by the
lessee, there
is some percentage
is supposed
to be
coming to the Commonwealth. So
I think that written policies and
procedures would help here as well.
And,
if
I
could
mention
one
other
thing,
as
Congressman
Faleomavaega was speaking to the need to be sensitive to the insu-
lar areas, in particular, with respect to their ability to comply with
various recommendations. We have been trying to work with all of
the insular areas because what we have found over the years
is
that, for the most part, we conduct audits, and then we do follow-
up audits a few years later, and find the same basic types of prob-
lems arising from year to year.
156
"
)
Our office recently had a meeting with Mr. Stayman in which we
were collaborating on what the real problems are and trying to give
some indication, based on our audit reports, as to the areas where
it might be productive to spend technical assistance funds.
And I think if we continue to do that, that might help to address
the problems by focusing the
assistance
in the areas where the
problems systemically have been over the years. So we are trying
to work with the insular governments and also working within the
Department of the Interior to try to do what we can to address the
situation.
Mr. KiLDEE.
I would encourage you to continue to do that. Thank
you.
Mr. Faleomavaega. Would the gentleman yield?
Mr. Kildee,
I would be happy to yield.
Mr. Faleomavaega.
I might respond to Ms. Lewis's statement.
I think we
all know what the problem
is basically and fundamen-
tally. Some of these insular areas just simply do not have the ex-
pertise where the lack of educational opportunities for the younger
generation, whether Chamorros
or Samoans,
to become account-
ants, to become engineers, to become doctors, to become lawyers so
the process, while the government continues to function with a lack
of this depth of experts, that we don't have the expertise so we
have to rely on outside help, whether it be by Labor, whether it be
because of consultations or whatever, but this is the problem.
And hopefully in the years to come that there will be more edu-
cated people, whether
it be in the Virgin Islands or Guam or even
in Samoa that the people themselves will then be able to—and in
my humble opinion, the bottom line is education. And we just need
more local people in the population to become experts in their given
fields.
And
I suspect that even
in American Samoa
I can account for
only two Samoans who are CPA's. And this
is unheard
of,
I am
sure, in many of the communities throughout the United States. So
with that lack of depth as
far as
if you talk about finances,
ac-
counting, and
all of that,
it just simply
is not there. And
I hope
that the sensitivity will be such that you don't blame the people be-
cause they are stupid, but just simply because they just don't have
the resources.
Ms. Lewis. Well, one of the additional things that we have been
trying to do in the office is, in some instances, to be more proactive,
and that
is to go in on the front side, on occasion, instead of just
on the back side of issues and look at controls that might be
in
place for a particular program or activity. We could render some
advice with respect to how to set
it up, as opposed to waiting until
it is set up and then going in and saying all of the things that are
wrong with
it. So to the extent that we can provide some assistance
in that regard, we would be willing to do that as well.
Mr. Gallegly.
I
will
defer
to you
in just a second. Bob. You
know,
in the interest of time, because the meeting
is really kind
of running—we
still have three panels to go—without objection,
I
am going to ask that we submit my questions to Justice and Labor,
and they can respond to me in writing in a timely fashion in the
spirit of trying to move this hearing along. And without objection,
I will defer to the gentleman from Guam, Mr. Underwood.
157
[Questions for Department of Labor follow:]
Questions Regarding the Minimum Wage
•
What
is the cost to administer the Wage Review Board Process in American
Samoa?
•
How long wovild it take for the Department of Labor to Implement a Wage Re-
view Process in the NMI?
,
,
,
t^
j
•
What industries or occupations in the NMI would not be covered if the Federal
minimum wage extended immediately in full?
•
How would various NMI Industries be affected with the
full extension of the
Federal Minimum Wage, a graduated $.30 per year increase, or a wage review proc-
ess?
•
How does the cost of doing business in the NMI compare with that in Guam
on an industry by industry basis?
[Questions for Department of Justice follow:]
Department of Justice
•
How many personnel are assigned to and what is the cost to maintain and op-
erate the INS office in Guam? What is the level of work load in Guam for tourists,
quest workers, permanent residents, and other significant work assigimients, and
how does that compare to the NMI?
•
If the INA were apphed to the NMI, but excluded as a port-of-entry and as
a place of asylum, and with specific industry categories of guest workers authorized
in the INA, what number of personnel would be required and what would be the
annual cost to the INS?
•
Given the
close proximity of Guam
to Rota and Saipan, what level savings
could be gained through cooperative action by the Guam and NMI INS offices?
•
How wovild the new $1.5 million computer system being installed in the NMI
for immigration help the INS to implement the administration of the INA partially
appUed and with specific industry categories of guest workers in the NMI?
•
If Congress were to authorize the prospective administration of the INA par-
tially-applied to the NMI, and given the manpower requirements, what is a realistic
lead time that would be necessary to adequately train personnel, develop regula-
tions for the administration of new specific industry categories of guest workers in
the NMI, integration of computer systems, and the estabhshment of physical offices/
work areas in the NMI? [One year? Two year?]
•
What problems have Justice or INS employees detailed
to the NMI encoun-
tered in dealing with the NMI Government Officials regarding immigration and or
law enforcement matters?
•
What percent of the United States are aliens, obviously excluding aliens who
have since become citizens no matter how recent?
•
How does that compare to the NMI?
•
At what level of aliens (percentage or ratio of aliens to citizens) should the
United States be concerned from an immigration management and sovereignty point
of view?
Mr. Underwood. Thank you, Mr. Chairman, and it is good to see
you again, Ms. Lewis and Mr. Sta3Tnan.
Ms. Lewis. Thank you. Nice to see you.
Mr. Underwood. Just
for my
edification on
this
issue
of the
management
of public
lands, two
basic
questions. Who
lost the
money, and who was it lost to? One. Secondly, is there an acknowl-
edgement of the scope of the problem as you have explained
it by
the CNMI, or are there any factors in this process which could said
to be mitigating or influencing the numbers that you have arrived
at?
Ms. Lewis. Who lost the money and who was
it lost to? With re-
spect to the land exchange process, one would not be talking about
hard dollars, if you will. It is not like the loss of the lease pa3niient,
for example, as a result of not having the minimum payment at the
level that it should be—at the fair market value.
27-245 0-96-6
158
What you have
is a
situation where
public land
is being
ex-
changed for private land, and
it is being exchanged for land not of
a comparable value. So in the final analysis what you end up with
is that the assets of the Commonwealth Government are lessened,
and this can ultimately turn into hard dollars. For example,
if they
lease the less valuable land that they have now exchanged for the
more valuable public land, ultimately they could lose lease reve-
nues. Similarly, if they were to sell the land, they would be getting
less in terms of dollars for it ultimately than if they had exchanged
it for land of comparable value. So
it
is not hard dollars with re-
spect to the actual exchange, but certainly down the road
it can be
converted into hard dollars at a later time.
Mr. Underwood. In a climate of a lack of appraisals, did you do
an assessment of the value of the land yourself
Ms. Lewis. No. We did not do an assessment of the value of the
land. What we did was look to see whether they were using the
most currently available appraisals. And what we found on a num-
ber of occasions was that they were using appraisals that were
dated or else the documentation in the
file did not indicate from
whence they were getting the numbers they were using. But we did
not go in and independently do an appraisal of the land.
Mr. Underwood. OK. So just on the question of—could you just
respond
briefly
to
did
the CNMI
Government
accept—not
nec-
essarily accept your recommendations, but did they just generally
accept that the problem is as you described
it, or are there factors
which may explain some of this?
Ms. Lewis. There was no indication from the response that they
rejected the recommendations that we made or the facts that we
produced.
It was more
a
question
as
to whether
the Common-
wealth's response was as responsive as we had hoped.
Mr. Underwood. Just briefly, Mr. Stayman,
in the general
re-
port, there has always been a lot of discussion about the CNMI and
the problems that
it continues to encounter. And, you know, one
scenario
posits that
if the minimum wage would just be
raised,
that all the other things would kind of kick into place, and that a
number of problems would be resolved.
Another scenario posits that if there was better control of immi-
gration that would be kind of the key point. And a third part talks
about
the enforcement
of labor
provisions
or kind
of making
it
sound
like a law enforcement problem.
I guess
I am concluding
based on your report that basically
it
is the minimum wage that
the report is hanging its hat on. Is that a fair characterization?
Mr. Stayman. At this time, yes. You know, we have to go back
and all appreciate what a tremendous challenge the CNMI has be-
fore
it. And
I want to take the opportunity to commend the Gov-
ernor for his commitment. He is facing a daunting task.
Imagine
if you can the population of your island tripling in
15
years. The CNMI
15 years ago was, you know, the island equiva-
lent of a sleepy small town
in Kansas, and now
it
is something
akin to downtown Manhattan. And they are confronting problems
across the board.
The solution
is going to require action in a variety of areas, but
our general policy is that we believe that the CNMI government is
in the best position to analyze their problem and build the capabil-
159
ity and be able to on an ongoing basis manage that problem. You
are never going to fix these problems. There is always going to be
crime. There is always going to be abuse and stuff like that.
Minimum wage was one of the things—we knew it wouldn't solve
the problem, but we thought
it would contribute to or let me put
it another way—it would dampen the demand for immigrants. See,
right now, they have an economy that basically is two parts. One
is the public sector.
U.S. citizens and the locals work at above minimum wage in that
sector, and then
in
the
private
sector,
that which we
generally
want to support and have grow, they have a much lower wage, and
the workers tend to be aliens.
By evening the minimum, giving everyone the same wage, that
would create or get rid of the disincentive for locals and U.S.
citi-
zens to work in the private sector. And, therefore, there wouldn't
be this demand for immigrants. Moreover, there would be a flow
of additional revenue into the Treasury that could be used to help
finance the tremendous demands on infrastructure.
So, you see, we saw it as a relatively simple thing to do. The gov-
ernment
at the time agreed with
it. The Chamber of Commerce
agreed with
it, and we didn't think it would solve the problem, but
it would help us with the trends.
Mr. Underwood. Yes.
I understand. Thank you very much.
Mr. Gallegly.
I guess we have no further questions.
I appre-
ciate all of our witnesses this afternoon, and please forgive my ab-
sence with the voting schedule and running back and forth. And
I
have
the good
fortune
of having the gentleman from American
Samoa to always stand in for me in my absence, which is a little
it
is not really traditional around here to do such a thing, but
it
has worked very successfully. And we will continue to do so as long
as it works as well as it has in the past.
Mr. Faleomavaega. Mr. Chairman,
I would also ask unanimous
consent
to
also allow other members of the committee
to submit
questions
to our famous panel here from Justice and Labor and
INS if they have further questions that they may have.
Mr. Gallegly. Without objection. That is a good idea.
[Questions may be found at the end of hearing.]
Mr. Gallegly. Thank you
all very much. The next panel we
have is the Acting Attorney General representing Governor Tenorio
here, Mr. Aloot, and we have a Representative, Juan Babauta. Mr.
Babauta, welcome.
Mr. Babauta. Thank you, Mr. Chairman.
STATEMENT OF RESIDENT REPRESENTATIVE JUAN BABAUTA
Mr. Babauta. Thank you, Mr. Chairman, for the opportunity to
testify before your committee. Before
I begin,
I want to thank you
for the recent assistance of you and your staff on two important is-
sues concerning the NMI. Your letter to Secretary Babbitt regard-
ing the need
for
his
attention
to the new group
of former U.S.
Trust
Territory
employees who may
be
eligible
for
pensions
is
much appreciated.
And your joint letter with Chairman Young to the Federal Com-
munications Commission supporting the NMI and Guam's effort to
obtain a domestic area code
is also appreciated.
It was most effec-
160
tive, and we have been assigned an area code for your information.
Thank you for your help.
My position on reform in the NMI is already on record with this
committee.
I testified here in January of 1995 regarding your pro-
posals in H.R. 602 on minimum wage and immigration. My written
testimony reiterates my position which has not changed, Mr. Chair-
man. My detailed response to the Interior Department's two rec-
ommendations
in this year's report are also
in my written
testi-
mony.
In summary, first, I appreciate the need for more prison facilities
as
Interior recommends.
However,
I remind
the committee that
this need
is a symptom of the root problem in the NMI, and that
is unrestricted immigration.
Second, I support a fair and just minimum wage in the NMI. But
rather than the simplistic 30 cent annual increase proposed by In-
terior,
I prefer the Federal Minimum Wage Review Board process
that has been successfully in use in American Samoa. This
is an
area where, obviously,
I disagree with Mr. Stayman from Interior.
And as you know, Mr. Chairman, this was a proposal that you also
supported.
Mr. Chairman, on a separate
issue,
I am here
also
to speak
about the reform
I consider most necessary and
I think least con-
troversial, and that is giving the people of the Northern Marianas
representation here in this Congress.
When
I testified on H.R. 602,
I said to myself that two principles
should apply
for congressional
policy
in the Northern Marianas.
One
is that any policy should
fulfill the fundamental Federal
re-
sponsibility to protect civil rights. And, second, that it reduces Fed-
eral involvement and promote local responsibility in the islands.
Application of those two principles led me to support your legisla-
tive proposals. Applications of those principles also supports rep-
resentation in the Congress for the Northern Mariana Islands.
There may be no explicit civil right to such representation, but
200 years
of practice have
established an
irrefutable
precedent.
And if Congress wishes to promote a greater degree of responsibil-
ity in the Northern Marianas, how better than to end our political
exclusion from the American family. Let us
sit on the panels that
decide on Federal policy toward the Northern Marianas. Let us be
responsible for taking care of our own interests here in this Con-
gress.
Mr. Chairman, our case is simple. We are citizens of the United
States. Yet, we lack the most basic right of citizenship, a voice in
our nation's government. We have been asking for 20 years. The
Marianas
Political
Status Commission
that
originally
negotiated
the Covenant
of political union between the Northern Marianas
and the United States asked for a delegate.
In
1985, the Commission on Federal Laws, appointed by Presi-
dent Reagan, and including Congressman Robert J. Lagomarsino of
this committee, asked that Congress consider legislation giving the
Northern Marianas a delegate.
Most recently, the Tenth Commonwealth Legislature, under the
leadership
of Speaker Diego
T. Benavente and Senate President
Jesus
R.
Sablan,
petitioned the Congress
for a
delegate
to
this
161
House. Copies of those resolutions have been attached to my writ-
ten statement which was submitted to this committee.
Our desire
is clear, and the only objection to a Northern Mari-
anas delegate ever documented has been our small population in
1975 compared to Guam and the Virgin Islands when they were
given
delegates. Twenty years
later, that objection no longer ap-
plies.
If you
look
at
the
histories
of the
Virgin
Islands, American
Samoa, the State of Washington, the State of Michigan, Montana,
and the Dakota Territories, the Northern Marianas has reached a
threshold of population set by precedents both historical and con-
temporary.
Mr. Chairman,
in opening your hearing on H.R.
602, you said
that "the territories are due the same treatment as other political
divisions of the United States," and
I couldn't agree more. But the
Northern Marianas does not even ask that. All we ask
is for the
opportunity to be represented in this Congress. Give the people of
the Northern Marianas what
all other U.S.
citizens living within
the nation's borders have, and that
is a voice here
in
this body.
Thank you, Mr. Chairman.
Lastly,
I want
to
extend my
appreciation
to
your
staff,
Mr.
Manase Mansur, for all the help that he has given us over this last
year and in previous years. He has been extremely helpful to my
office,
to me, and to my
staff, and in that sense, to the people of
the Northern Marianas. And
I really appreciate that. Thank you.
[Prepared statement of Mr. Juan N. Babauta may be found at
the end of hearing.]
Mr. Gallegly. Thank you very much. Mr. Aloot.
STATEMENT OF THE HONORABLE SEBASTL\N ALOOT, ACTING
ON BEHALF OF ATTORNEY GENERAL, NORTHERN MARLVNA
ISLANDS GOVERNOR FROILAN TENORIO
Mr. Aloot.
Yes. Mr. Chairman,
as you have indicated
or has
been indicated,
I am the Acting Attorney General of the Common-
wealth of the Northern Mariana Islands.
I appreciate the oppor-
tunity to appear before you and the committee concerning the re-
cent Department of Interior report on labor, immigration, and law
enforcement, and what I believe was to be the Department of Inte-
rior Inspector General's report on management of public lands. Due
to the shortness of time,
I ask that my prefiled written testimony
be submitted for the record.
Mr. Gallegly. Without objection.
Mr. Aloot.
I did have a brief summary of my longer testimony.
I am going to lay that to the side and deal
directly with what
I
think
initially was an
issue that perhaps
struck a chord
it
ap-
peared among the committee, and that is the IG audits; in particu-
lar, the audit on management of public lands.
Let me just point out that out of all the audits identified by the
Interior Inspector General as part of her summary of testimony, all
but one deal with activities by the prior Administration of the Com-
monwealth of the Northern Marianas. Even the audit of the man-
agement of public lands, completed in 1996 or at least issued in
1996, my brief recollection
is three or four of the 20 some leases
162
looked at were done by the present Administration. Most, again,
were in the past Administration.
Turning
to the audit
of the management of pubUc lands,
yes,
problems were encountered; problems that I believe the officials of
this Administration and I believe past Administrations knew about,
and then the question is what corrective action should be taken.
There is a underlying,
I believe, mischaracterization that is part
of the Inspector General's land
report.
It starts out from the as-
sumption or that the question presented is what did the Common-
wealth do with the lands the United
States gave the Common-
wealth?
Point in fact, the United States had no lands to give to the Com-
monwealth. Those lands historically were and are the property, the
culture, the heritage,
if you will, of the people of the Marianas Is-
lands. The United States never had
title to them. Now, point in
fact, the United States merely returned what
it had taken under
the guise of the Trust Territory Government.
Be that as
it may, what
I think the other mischaracterization or
misleading part about the audit, because
I will get to what
I be-
lieve are solutions that you were probing for, and that
is the con-
cept
of valuation.
I believe that Delegate Underwood
raised the
precise question that should have been asked and the IG should
have continually asked herself or her people, and that was what
was lost and who was it lost to?
It appears that they used the—they adopted an approach that
one must use two things—the most recent appraisal of property,
which
I believe
if you did a
full audit with any sort of historical
understanding would not have been the approach you
used,
be-
cause one of the problems of land valuation in the Commonwealth
and
I believe throughout Micronesia is the very validity of the ap-
praisals themselves. Land appraisals are difficult to do in the best
of circumstances. They are much more difficult in Micronesia and
in the Commonwealth, assuming people even want
to do
it
cor-
rectly.
The second point—and
I think
it is even more critical when you
assess what was lost and to whom
it was lost to.
I have to tell you
that my sense, my valuation of the IG audit, which
I believe was
done in good faith,
is that
it
is one dimensional.
It assumes that
the only reason, the only factors one considers in leasing out land,
be it private or public, is how much can you get for it and how fast
can you get it?
And while perhaps
in private
leases that
is
inappropriate,
in-
deed, that might be the only legitimate business approach.
I believe
that government officials have to look at more factors. For example,
there was an article that appeared not too long ago, the Mayor of
Detroit,
I
believe, was getting awards
for his foresight in giving
away public land—public lots within the city when the person who
got this free land agreed to put in a commercial establishment that
gave rise to secondary economic benefits—employment, taxes.
I be-
lieve, and
I know the Governor believes this, that those are legiti-
mate factors to consider in determining when and at what level one
grants a lease of public land.
The final point on that before I go on to the other points is I hope
the Interior Inspector General continues on the audit of leases of
163
public land
to make sure that the Commonwealth gets value
for
dollar. And one of the leases
I think
I would recommend that she
look at
is the United States lease of the American Memorial Park
at the Kanapeg Reservation.
Our calculations are that the United States entered into a lease,
leased that property, that 177 acres over a 100-year term, for the
grand sum of $1 per month per acre. So, obviously,
I would think
the Executive Branch would agree that there must be legitimate
factors that warrant public land leases that consider benefits other
than dollars. At least I would hope so.
With respect
to the
corrective
action, having said
I think that
there are explanations for perhaps some of the gross characteriza-
tions that you
see, there have been problems.
I will
tell you that
I now have four lawyers assigned almost—well, three lawyers, one
being employed assigned almost full time to issues like this.
Today, while—^yes, this
is late enough—while we are doing this
hearing, my new government contract procurement lawyer is arriv-
ing in my office in Saipan. Her job will be to focus on these kinds
of issues in the government procurement contract area.
I have committed a lawyer working, in essence,
full time to de-
velop,
initiate, prosecute, and prevail in land fraud cases. That
is
where public land was stolen from the public and made private.
I
think the record will show that our approach to that issue
is we
are prepared and have or brought cases against the very prominent
people. We don't make
distinctions. We are an equal opportunity
prosecutor in that regard.
We have another attorney who we plan to hire, because we just
got approval to do this,
to deal with the issues of lease payment
recovery. At the present time,
I am trjdng to function in that re-
gard, and I am engaged in back rent collection negotiations.
So
I think that to the extent that there are legitimate concerns
about how land was leased or acquired in the Commonwealth, the
solution
is not only the development of regulations to ensure that
this does not happen again, and no set of regulations or law will
guarantee
that
it
will never happen
again, but
is
also ensured
through vigorous enforcement so that every one knows that there
is a price.
And I assure you, while I did not come prepared to give you case
names and filings,
I assure you that at least in the current office
of the Attorney General there is and will be a price.
OK.
I would like to now get back on track to some of the issues
I think are just as important outside the area of land and manage-
ment of land but also
Mr. Gallegly. Mr. Aloot,
I know that you have a
lot of things
on the table there today, and
I know you have come a long way.
And we are really getting behind, and
I have gone double over the
time already. If there is any way that you could kind of summarize,
I would sure appreciate
it, without denigrating the message that
you have to present.
Mr. Aloot.
Sure.
Focus on just—let us
try three
issues very
briefly—the report, which
I think is the principal driving force be-
hind the hearing.
I believe there are two elements
I would like to
address very briefly that are part of that report that
I find either
misleading or unacceptable
to the Commonwealth and then deal
164
very quickly with the recommendations because
I think the have
already been dealt with by other witnesses.
First, we
are
troubled by the
paternalistic observation
in the
Task Force Report that Native Chamorro and Carolinian culture
and
influence has somehow been
diminished because
there
are
large numbers
of,
I
will
stress, nonvoting foreign workers in the
Commonwealth.
The indigenous people of the Northern Marianas and their cul-
tures have survived three centuries of Spanish domination and pe-
riods
of German and Japanese
occupation,
all preceding the 50
years of affiliation with the United States. Their culture will pre-
vail not due to their isolation, but due to the strength of their peo-
ple. In
fact, many of us believe that immigration and interaction
can enrich our culture much as
it has done in the United States
itself
The other misleading suggestion in the Task Force Report is that
the
children
of foreign workers
are overwhelming the Common-
wealth's public school system. The fact
is that 80 percent of these
overwhelming numbers
are
children
of Micronesians, which the
Commonwealth is required to permit entry into our borders by vir-
tue of U.S. -negotiated compacts.
I will report to you that we are now engaged in litigation before
the Federal District Courts to clarify our immigration obligations
under those compacts.
I will also report to you that Guam and the
Commonwealth have recently
initiated
litigation seeking to force
the Executive Branch to finally discharge
its long-ignored duty to
seek annual appropriations to address the negative impacts of such
free immigration by Micronesians into the Commonwealth and into
Guam.
I can also indicate that the State of Hawaii
is prepared to join
our litigation. Clearly, the source of the immigration problem in the
Commonwealth and responsibility for paying the cost lies on both
sides of the Pacific.
Turning to the minimum wage,
I believe that the delegate from
American Samoa and Representative Babauta and indeed I believe
it was the
representative
of the Labor Department
actually
all
agreed. We support a study.
We support a minimum wage, be
it tiered or at some accelerated
rate based on
fact, not fiction, based on what
is the economic re-
ality of the Commonwealth, not the economic policy of and may
I
add social engineering goals of people in Washington.
It
is too expensive for the United States. That
is fine. Governor
Tenorio
has
decided
that
the Commonwealth
will
pay
for
that
which the United States does not think they can afford, which
is
for once having a minimum wage debate based on the realities of
the Commonwealth, not on the policy goals of Washington.
I don't
think that
is an abnormal message in the current political struc-
ture of America.
I
also need
to emphasize much debate has been made on the
minimum wage going up 30 cents, 50 cents, or the minimum wage
is not comparable to the Federal minimum wage.
I think
it
is im-
portant
for everyone
to understand
that
in
the Commonwealth
minimum wage does not stand alone
like
it does
in the United
States.
165
In the Commonwealth, one is entitled to the minimum wage—let
us assume the original minimum wage of $2.75 an hour—but the
Commonwealth requires benefits to be provided to foreign workers
that are not provided in the United States.
Our
Department
of Commerce
conservatively
estimates
that
when you add the value of the medical insurance, housing,
food,
local transportation and the
like
to our minim.um wage, that the
Commonwealth, even before the most recent increase, had an effec-
tive minimum wage of at least $4.68 an hour.
The
support
that
the Chamber
of Commerce
provides
or has
given for an increase in the minimum wage,
I hope that they indi-
cate when they testify that support is predicated upon an equal de-
crease in the non-salary benefits that are required under Common-
wealth law.
So I think if the reality of the Commonwealth's approach to mini-
mum wage and its desire to have for once a local determination of
its local economic needs and social needs in light of locally based
facts,
if the reality is known or understood, the Commonwealth al-
ready matches in benefits and salary the Federal minimum wage.
Because
I know
it has been a long day for a
lot of us,
I would
just like to make sure I haven't missed anything that I think is im-
portant for this committee to hear from us.
I think
I have every-
thing.
I will just make one observation, one plea from me.
There
is much talk in this halls of government about authority
and responsibility. Authority is the power to say yes. Responsibility
is the wisdom to say no when one has the power to say yes. This
Congress clearly has the authority to say yes to the legislative pro-
posals concerning the Commonwealth that are now before it.
We urge you to show the wisdom to say no to what, in
fact,
is
an unwarranted Federal
intrusion
into our
local decisionmaking
process as we continue to implement local solutions to local prob-
lems involving local resources.
I thank you for the opportunity to
give this
I guess modified testimony, and I will be happy to answer
any questions that you might have.
[Prepared statement of Mr. Sebastian Aloot may be found at the
end of hearing.]
Mr. Gallegly.
I thank you very much, Mr. Aloot. Inasmuch as
I relinquished my time so that you would have an opportunity to
better present your testimony today
Mr. Aloot.
I appreciate it.
Mr. Gallegly.—I would ask unanimous consent
to submit an
opening statement that I had for the record.
[Prepared statement of Hon. Elton Gallegly follows:]
Statement of Hon. Elton Gallegly
As we commence the Oversight hearing on Northern Mariana Island issues on
labor, immigration, law enforcement, and related legislative reforms, let me extend
a welcome to those who have traveled from the Marianas. While potential reforms
affecting the NMI still generate discussion in Washington and in the NMI,
I beUeve
there are reasonable approaches with sound solutions which wUl benefit the
resi-
dents of the NMI.
This hearing shovild provide an opportunity to obtain further information regard-
ing the application of a federad minimum wage, the management of immigration and
alien guest workers, law enforcement practices, and other matters in the NMI. The
views of the administration and the NMI regarding the progress in these areas since
166
the last Subcommittee hearing in January 1995, should be particularly relevant to
further consideration of NMI legislative reforms.
The hearing agenda also includes the oversight of management problems regard-
ing the disposal of Water Island in the Virgin Islands. The Interior Inspector Gen-
eral, Wilma Lewis has been asked to appear, not only to address IG audits per-
formed in the NMI, but to also provide additional information to the Subcommittee
regarding the disposition of the Water Island property.
The Administration will lead off as the first of three panels, and will include the
Interior Inspection General, Wilma Lewis, Allen Stayman of the Office of Insular
Affairs, and representatives of the Department of Justices and Labor.
The second panel will include John Babauta, Resident Representative of the NMI
and the Grovemor's representative.
I understand the Resident Representative may
be accompanied by other NMI
officials and
I ask that he introduce those present.
And, finally, the Subcommittee will hear testimony presented by the President of
the NMI Chamber of Commerce, Mr. Sam McPhetres. Other witnesses invited to
represent different human rights organizations in the NMI, although not appearing,
may submit their statements for the record.
Mr. Gallegly. And
I just had one question
for Representative
Babauta. Is the legislature in the NMI prepared to enact necessary
local legislation for the election of a delegate
if the Congress au-
thorized such action?
Mr. Babauta. Mr. Chairman, having served in the legislature,
I
prefer not to speak on behalf of the legislature. The Speaker is cer-
tainly in this room, and
I regret
I failed to introduce him to the
committee. If you would like, he is here.
Mr. Gallegly. Speaker Benavente is present?
Mr. Babauta. Yes. The Speaker
is here in this room.
If I may
ask for him
Mr. Gallegly. If Speaker Benavente would like to come forwa^-d
and just be recognized, perhaps he could answer that question for
me.
Mr. Benavente. Thank you, Mr. Chairman, and good afternoon
to you and the committee. My answer to the question
is yes. As a
matter of fact, we have discussed this during the process of discuss-
ing the resolutions that we have adopted recently in the Tenth Leg-
islature and also in the past three legislatures that
I was a mem-
ber of.
As a matter of fact, our constitution and the Covenant provides
for a mechanism or a process for this changeover. And all we would
need
is actually a law that would allow for this election, and
I be-
lieve that that will be possible, and we can do
it.
Mr.
Gallegly.
Thank
you
and
welcome
this
afternoon.
Mr.
Faleomavaega.
Mr. Faleomavaega.
I just want to say, Mr. Chairman,
I would
be more than happy to accommodate whatever your wishes might
be to make sure that the proper authorizing language to provide
the delegate representation
for the Northern Marianas. We have
had some precedents, and
I am sure there will be no problem in
doing this.
And
I am very happy that there
is a sentiment on behalf of the
Chairman and interest, hopefully, that this matter might be pro-
vided for the NMI. Just a couple of quick questions.
I know we are
way over the time. What
is the per capita income
in the NMI?
What is the average wage income in the Northern Marianas? Does
anybody have any—submit
it for the record
if by chance you don't
know that. Is it above the minimum wage?
167
Mr. Aloot. Yes,
it
is. We will get the information submitted for
the record.
Mr.
Faleomavaega.
Please
provide
that.
I
understand,
and
please correct this for the record, there are currently 7,000 Chinese
workers in the garment factories in NMI, and
I was just wondering
that if there had been any workers' rights' abuses of some of these
workers in NMI, and,
if so, has our Attorney General's Office been
very successful in prosecuting abuses of the workers? You know,
those who are working there at NMI, have you had any problems
with this issue?
Mr. Aloot. Well,
first,
let me say that
I think the proper and
less inflammatory word is violations of labor laws.
Mr. Faleomavaega.
If you wish.
I would be more than happy
to-
Mr. Aloot.
I personally
Mr. Faleomavaega.
I am
still learning English so please help
me.
Mr. Aloot.—reserve the word abuse for more serious matters.
But certainly we have faced and uncovered the same kinds of viola-
tions of labor laws,
civil rights laws that are found everywhere in
the United States.
I don't think I need to run down the list of cities
that have been
in
the newspapers from one
or more
of the 50
States in the last three months. So we have identified them.
Some of the problems I think go beyond our borders because they
involve perhaps—some of the predicate acts for some of the viola-
tions do not occur within our jurisdiction. We have a very active
and I think good relationship with the on-site Federal officials, par-
ticularly the U.S. Attorney's Office, to try to share information. We
have perhaps the best, closest relationship of any jurisdiction with
the Republic of the Philippines on a joint enforcement of our
Mr. Faleomavaega. Mr.
General,
all
I want
is just assurance
from your office that you are aggressively pursuing or prosecuting
those who do abuse labor law violations.
Mr. Aloot. Well, of course, I would say that
Mr. Faleomavaega. That is all
I am trying to pursue here.
Mr. Aloot. Of course,
I would say that
I think we are.
I would
like to do more.
I have to tell you that we have increased, for exam-
ple, just this last month, the number of attorneys in the office 100
percent.
I have a simple rule, and that is 100 percent- 100 percent
of the time.
I think everyone who works for me delivers. But to be
honest with you,
I am never going to be happy with the level of
enforcement, but I think the record will show that it is aggressive,
and it is across the board.
Mr. Faleomavaega. You mentioned also, Mr. Babauta, about the
unrestricted immigration policy—whether it is a matter of policy or
local law, that also this is a Federal law that allows your fellow Mi-
cronesians from FSM can immigrate to Saipan unrestricted. Is this
the problem that you are faced with? And what
is the estimate of
the population? Now,
I know you are about 45,000, but right now
the Tumaural population is almost less than 50 percent right now?
Mr. Babauta.
Yes, much
less than
that. The
population
that
combines—the figure that combines the Chamorro and the Caro-
linians
is roughly about 22,000. The total population of the NMI,
according to the mid-year 1995 census, is about 60,000.
168
Mr. Faleomavaega.
I
see. And you are having a very
difficult
problem right now in providing health care similar to the impact
costs that our friends in Guam also 2ire having. Is the Federal Gov-
ernment giving any assistance to the NMI with regard to this prob-
lem—compact impact?
Mr. Babauta. No. We have not, Mr. Chairman.
Mr. Faleomavaega. Have you requested assistance in this mat-
ter?
Mr. Babauta. We have over and over in the past two—three
years—five years, and the
assistance under the compact impact
have not been forthcoming.
Mr. Aloot.
If I may interject,
I think
I indicated—if I didn't,
I
apologize—^uam, the Commonwealth, and
I think by next week
the State of Hawaii will be in litigation with the Executive Branch
seeking the very compact impact assistance that this Congress as
already authorized and needs only to be appropriated based on a
report of that impact.
Mr. Faleomavaega. Just one more basic question, Mr.
Chair-
man.
I am sorry that we are
still running—could
I get the assur-
ance from Mr. General that you will respond to the Stated state-
ment of the Inspector General and some of the things that are stat-
ed there? You will provide a full response to the allegations stated
in the Inspector General's report that was
Mr. Aloot. Were there allegations against my office?
Mr. Faleomavaega. No, against the NMI.
Mr. Aloot. Oh,
I think that the Governor has responded.
I think
the Inspector General indicated that she was not satisfied.
I
cer-
tainly will commit to review the Governor's response and to the ex-
tent that
it was a lack of clarity, or there
is new information pro-
vided, or ask the appropriate official to provide
it. But
I can't as-
sure you that the Inspector General
will be happy with our
re-
sponse.
Mr. Faleomavaega.
I thought you had committed four of your
attorneys and your staff that you were going to review this more
thoroughly, and
I thought
Mr. Aloot. No, no. The attorneys are not to review that Inspec-
tor General's report.
It
is to go after people that owe us money or
owe us land and get it back.
Mr. Faleomavaega. Thank you, Mr. Chairman.
Mr. Gallegly. The gentleman from Michigan.
Mr. Kjldee. Just very briefly. Mr. Babauta, you are very correct
in your observation about the members of the committee who rep-
resented places that at one time or
still are represented by a non-
voting delegate. Michigan was represented by Gabriel Richard, a
Catholic priest, who is one of the co-founders of my university. Uni-
versity of Michigan.
And
I think probably the only two States that didn't have that
outside the original colonies was California—I think you came in
directly as a republic to the Union—and Texas, but the rest of us
did go through that. So as a history major,
I appreciated that state-
ment very, very much.
I fully support you having a representative here in the Congress
of the United States.
I think that
is the least we can do for those
who share with us that American citizenship.
I think we can do
169
even more, but
I think that is the first step we should take—is to
give you representation here. And certainly we will support that.
Just one brief question, Mr. Chairman. You mentioned that when
you take into account, Mr. Aloot, the employee benefits—housing,
medical care, that the minimum wage is about 4.68—could you give
just briefly a description of the nature of the medical care that the
people are able to receive there?
Mr. Aloot. Well, this may come off wrong, but
I describe
it as
the Hillary health plan. It is full, across-the-board, 100 percent.
Mr. KiLDEE. OK. Well, that probably pleases
Mr. Aloot. Oh, no.
Mr.
KiLDEE.
Pretty
broad
then,
right?
Surgery—these
mat-
ters
Mr. Aloot. Yes.
Mr. KiLDEE.—are all covered?
Mr. Aloot. Pregnancy. Correct me
if I am wrong anybody, but
I believe it is 100 percent across the board.
Mr. KiLDEE. Straight comprehensive then?
Mr. Aloot. Yes.
Mr. KiLDEE. So when you look at the dollar minimum wage and
add in the benefits,
it would come up to what you feel at least
Mr. Aloot. The minimum
Mr. KiLDEE. A minimum of 4.68 then.
Mr. Aloot.
4.68.
Certain other industries
I have been
told—
don't have a figure—I have been told
it
is higher because of the
way that industry—for example, they have a right
to deduct for
housing, but they don't.
Mr. KiLDEE. Someday I would like to come to the Northern Mari-
anas and look at your health care system.
Mr. Aloot. You are more than welcome.
Mr. KiLDEE. Because
I think maybe we could learn something
from you on that. Thank you. Thank you very much.
Mr. Aloot. All rightie.
Mr. Gallegly. Mr. Underwood.
Mr. Underwood. Thank you, Mr. Chairman. And
I too want to
add my words, and, of course, as Mr. Babauta and
I have discussed
over a number of months,
I have introduced legislation
to give a
delegate to the Northern Marianas—to grant a delegate, although
I would add that being a nonvoting delegate
is not
all that
it
is
cracked up to be, Mr. Babauta. So you might want to keep that
under consideration.
Indeed,
with
representation,
responsibility
and
accountability
grows, and
I think one of the major difficulties that we are having
in the course of dealing with issues with the Northern Marianas
and kind of missing each other in the dark sometimes and not real-
ly understanding what is going on is precisely the lack of represen-
tation on the Hill on a daily basis, an
office, a central point from
which to understand and explain what the issues are at stake.
If
we had that, perhaps there would be far less misunderstanding.
Mr. Aloot, your testimony concerns me in a couple of ways. One
is that
I am never
really persuaded by the
idea that when the
question was raised about the enforcement of labor standards and
laws and the word abuses were used and you used violations and
170
then you made comparisons to other areas, indeed, there is always
violations of laws and standards in other areas.
I think the question has
to be addressed very seriously, and
I
would certainly ask for the record that some kind of documentation
be given to the Subcommittee in terms of the number of allegations
made, the number of charges that emanated from your office as a
result
of the
allegations, and the number of convictions, and
to
chart that over some time so we can see whether there has been
any effective action on this.
There are three—and
I ask the question of Mr. Stayman because
his
report was moving
in that
direction, and
basically the
focal
point of trying to deal with the issues that have been of some con-
cern over the Northern Marianas have been, one, the one general
strategy or the one seen—not remedy but certainly one strategy to
attack
it
is the full application and enforcement of labor laws and
standards, and that if somehow or other that was adequately taken
care
of, that that would basically resolve most of the issues that
concent many members of Congress.
Secondly, the alternative viewpoint, although all of these are im-
portant, would be dealing with the minimum wage. And
I might
add that even though the minimum wage
is a complex
issue,
I
want to point out that in the case of Guam, H2 workers who are
brought to Guam are paid a prevailing wage, which
is the wage
not a minimum wage, but a prevailing wage, which,
in many in-
stances, is three times as much.
And the obligation to house them, and the obligation to provide
medical care, and the obligation to bring them to Guam and take
them back home is there as well. And so that merely adding on the
cost of what labor recruitment on that is not very persuasive to me
I would like to state.
And then the third triad of this is the immigration control. Now,
I guess of those three, the responses have always been kind of in-
teresting
to me. One
is that no one
is interested—and
certainly
least of all
I—I am not interested in taking away or denying any
prerogatives that the CNMI has legitimately garnered and which
are sometimes the envy of people from Guam.
Mr. Aloot. May
I add
that
I
believe Guam
is
seeking those
very
Mr. Underwood. Yes. Sure, sure.
I am fully aware of what
I am
seeking, Mr. Aloot. In the case of local control of immigration, the
counterargument
is
local
prerogatives, and
I
respect them. The
issue of minimum wage is then—it kind of goes into a very odd ar-
gument about, you know, if you add this to that and if you separate
out the garment industry and
it
is a complex
issue, and indeed
minimum wage
is always a complex issue everywhere, but gen-
erally I don't get the sense that it is the same argument about local
control as the energy is behind immigration.
And then we have the application of labor laws and standards
and strict enforcement, and then we get words which say, well, you
know, there is the myth and there is the fact. I want to get a sense
from what is the Tenorio Administration's position on this?
I mean, where do they see this, or are they in a sense saying that
there are no real serious difficulties, and that if there are no seri-
ous difficulties, then I wish someone would just say that. "We deny
171
that there are serious difficulties. We don't know what all this in-
quiry and
all this
is going on, and we are shocked that
all this
is
going on."
Is there a problem, and
if there
is a problem, do you see that
these three scenarios, which have been advanced by various peo-
ple—stricter enforcement, raising the minimum wage, or Federaliz-
ing immigration—is a viable strategy?
Mr. Aloot. All right.
I would have to say that only a fool would
say that there are no problems, and we are not fools.
I also believe
that each of the
strategies that have been advanced
will play a
role. There is some question as to what impact each of those strate-
gies will have, and which ones should be perhaps first, second, and
third on the list. But they each need to be pursued to be fully effec-
tive across the board.
But the critical point here, I think, is the assignment of priorities
among those three alternatives.
I believe that the Commonwealth
has earned,
I believe that the Commonwealth has a right to con-
tinue to stay the course that Governor Tenorio has laid out, which
is admit the problems, honestly assess them, and vigorously imple-
ment corrective action.
I don't think that
is wrong.
I don't think
it
is asking what any
of the jurisdictions that you represent, including Guam, would be-
lieve that it is—that would be their right as a member of the Amer-
ican family. At least have a chance to
fail.
I can almost see some
meaningful success on the horizon, and
I think that
I have a—
personally—to me reform means more than a word.
It
is an
atti-
tude. It is a commitment.
It
is a willingness to put
it on the line, and
I believe that there
are many people who are in this process working for the Common-
wealth. Many of them no one will ever know who are willing to put
it on the line, and they deserve a chance to succeed.
Mr. Underwood. Thank you. Mr. Babauta, do you have a com-
ment?
Mr. Babauta.
I don't have any comment.
Mr. Underwood. Do you have any comments on the general di-
rection of, you know, addressing all the issues that apparently con-
cern the CNMI which are grabbing attention here in Washington?
And the discussion has always circulated around either Federal-
izing the minimum wage or dealing with the minimum wage
in
some way, controlling immigration, or perhaps applying stricter en-
forcement of labor laws and standards. As
I understand
it, and
I
could be wrong, Mr. Stayman's report focuses right on the mini-
mum wage as a way to deal with the situation.
Mr. Babauta.
I think part of the strategy in the Interior's report
is to focus on addressing the issue of minimum wage and while
it
ignores the issue of the open door policy of immigration into the
NMI and hoping that some implementation of control on minimum
wage would address and solve, at least partially, the problem of im-
migration. While
I partly agree with that,
I
still think that
it has
to be—^both issues have to address the head-on.
Mr. Underwood.
I appreciate that, and I want to add my words
of welcome to Speaker Benavente.
Mr. Babauta. Thank you. If I may just add a comment before
if I may, Mr. Chairman?
172
Mr. GiLCHREST. [presiding] Please do. Yes, sir.
Mr. Babauta.
I want to express another thank you to Delegate
Faleomavaega and Delegate Underwood for
all of their assistance
that they have given me and my office and my staff over the past
several years. In fact, ever since
I have been here in Washington,
Congressman Underwood especially has extended a great help to
the NMI on issues of telecommunications and being a sponsor of
the delegate
bill and the service academies. And,
in
fact,
I have
sought his assistance for constituent assistance from the NMI, and
I have to
tell you
I will continue to burden you with this as long
as you don't give me a delegate.
Mr. Underwood, That was why I was your main sponsor.
Mr. Babauta. The least
I could do for you
is that, you know,
if
someday I move to Guam and live there,
I would certainly vote for
you. So with that,
I just want to thank you.
Mr. Underwood. Thank you.
Mr. GiLCHREST. Thank you very much. Are there any other ques-
tions from any of the members?
I apologize for—we always have a
scattered schedule—for not being here during the course of your
input and the questions.
It
is an issue that we are sensitive to as
far as the economics and the human side of wages, and what, after
all,
is going to be the most benefit to the people who are working
for the wages and the people who are paying the wages to stabilize
the circumstances. So we will continue to look at this, and
I will
rely heavily on my colleagues.
Mr. Faleomavaega. Mr. Chairman?
Mr. GiLCHREST. Yes, sir.
Mr. Faleomavaega.
I would be remiss
if I did not also express
my appreciation in seeing this Honorable Speaker Benavente in the
presence of our committee and certainly welcome him and look for-
ward in getting the benefit of his leadership and wisdom and mak-
ing sure that issues affecting the Northern Marianas on behalf of
the legislative side of the Government of the Northern Marianas,
that we will certainly look forward in working together with you,
Mr. Speaker, and the members of your chamber,
Mr, Aloot, Excuse me.
If I could note. Delegate Underwood did
ask for some information on the specific activities of the Common-
wealth,
I
will seek
if I can have leave of the committee to send
such additional information on our activities, which
I will say just
include the—we have now begun—taken a first step in implemen-
tation of our computerized immigration tracking system, which the
United States INS
is very enthusiastic about the potentials that
system has for the United States immigration system.
The Task Force indicates that there has been a series of arrests
and convictions for drugs and the like. What the Task Force Report
does not report adequately,
I believe,
is that those are joint Fed-
eral-Commonwealth law enforcement task
forces using Common-
wealth funds in some cases, but certainly Commonwealth law en-
forcement officers.
So
I think that and some other changes
I think will give flesh
to the bones of reform that I have mentioned. If I can provide that
in the next two weeks,
I think that will be enlightening,
Mr, GiLCHREST, Thank you very much. We will be looking for-
ward
to
seeing
that
information. One
of the
problems
here
in
173
Washington, we are trying to get rid of the flesh and go down to
the bones. But you make an excellent analogy.
We do appreciate
all of you coming this long distance here
to
Washington, and we have a sense of appreciation for the problems
that you are going through with the
political ramifications of the
minimum wage depending on which party you are in.
But we will do our best to pragmatically look at the issue. We
won't demagogue the issue. We will look at
it as pragmatically as
possible. Thank you
all so much for coming, and have a safe trip
home. Panel three
is Mr. Sam McPhetres, Chamber of Commerce,
and Mr. Bill Campbell, Northern Marianas, Protection & Advocacy
Systems, Incorporated. Mr. McPhetres, thank you very much for
coming, and I don't have a little background. Where are you from,
sir?
Mr. McPhetres. I am from Saipan, sir.
Mr. GiLCHREST. Pardon?
Mr. McPhetres. I am from Saipan.
Mr. GiLCHREST. You are from Saipan.
Mr. McPhetres.
I am President of the Saipan Chamber of Com-
merce.
Mr. GiLCHREST. You sort of look like you are from New Jersey.
Mr. McPhetres. It is because I am very unused to this.
Mr. GiLCHREST. Oh, I see. Well, thank you very much for coming,
sir. We look forward to your testimony.
Mr. McPhetres. Thank you, sir.
STATEMENT OF SAMUEL MCPHETRES, PRESmENT, CHAMBER
OF COMMERCE, SAIPAN
Mr. McPhetres.
I would in the interest of time dispense, with
your permission, with reading my prepared statement and proceed
with a brief summary of some of the key issues.
Mr.
GiLCHREST. Your
full
statement
will be
entered
into
the
record.
Mr. McPhetres. Thank you. In the beginning,
I would like to
also state that the Saipan business community is fully behind the
push for a delegate to the House of Representatives,
£ind we will
support every move we can make on this issue. We think
it is ex-
tremely important.
To go through the main points here very briefly,
I would like to
state that the Saipan Chamber of Commerce has been in favor of
the continued increase in the minimum wage as stated by Public
Law 8-21 of the Northern Marianas.
As the Acting Attorney General
stated, we are
also concerned
that all consideration of this take into account the mandated bene-
fits which we are required to provide to our employees by local law.
If they are nonresident workers, they are required to receive room
and board, transportation, health care.
I might add with the health care issue, something that has not
been brought up, this
is health care 24 hours a day, seven days a
week. No matter what the issue
is, the employer is responsible for
whatever happens to their employees while they are in the Island
of Saipan or in the Commonwealth.
We feel that the increase in minimum wage will help us to de-
crease a dependence on alien workers because
it will force employ-
174
ers to be more discriminating on who they hire, looking for higher
skilled
people,
people
motivated, and
people who
will be
better
trained. And with that in mind,
I would move on and respond to
any questions you may have on this.
On the issue of immigration, we do consider that there is a major
crisis pending. We now have, and
I am not sure, the Interior has
had one
set of figures on the population. A recent census by the
Northern Marianas Government has come up with a slightly
dif-
ferent set of figures.
Based on the Northern Marianas audit, there are approximately
40,000 nonresident workers in the Commonwealth. We now have
3,000 more hotel rooms under construction and a possible casino or
two on the Island of Tinian. Each of these projects will entail the
arrival of a large number of nonresident workers
if we cannot en-
tice U.S. citizen workers to come. This could lead to a major prob-
lem in a variety of areas.
This morning at the Senate hearing,
I suggested, and
I am quite
serious, that somehow we need to be able to sit down and do some
serious planning. This has not been done. It is not being done, and
to my knowledge, there is no attempt at having this done.
I say this sounds like a little strange thing coming from a Cham-
ber of Commerce, but the stability in the marketplace, stability in
the environment is absolutely essential to doing good business. And
we have been doing a lot of firefighting in the last few years. We
would like to avoid that.
A similar example would be the zoning law, which we may have
had some problems with
it, but at least
it gave people an idea of
what
to
expect. The
zoning law was
then
suspended
for
three
years. We have no zoning at the present time. Aiid several inves-
tors have disappeared because of this.
The other element of immigration
is related to law enforcement.
Much of our crime that
is going on in the Commonwealth at this
point in time is internal to various ethnic and national groups.
We have found over the past several months that the Tongs or
Triads from China have been exercising a protectionist racket in
the Commonwealth directed internally to other Chinese businesses.
We have a problem with prostitution. This was mentioned in the
report. This is also an issue that has been brought up with the Chi-
nese population.
The Chamber is very active in supporting Federal initiatives. We
have, in
fact, held seminars and workshops with Federal law en-
forcement personnel. Federal regulators
to educate the public
in
the Commonwealth about what their responsibilities are and to get
some dialog going. We think we have been quite successful in this
in a lot of areas.
Our seminars have been very popular, and we have had a very,
very good response to them. And we wish to assure this committee
that we will continue to do
so. We offer our full cooperation with
all the Federal authorities dealing in the Northern Marianas
for
whatever purpose, which brings me to the final point
I would like
to make very briefly, and that is Federal-Commonwealth relations.
Sometimes we have problems that are definitely of our own mak-
ing. There is no question about that. Sometimes these problems are
coming to us from outside. And
I would like to point out two spe-
175
cific examples.
I am sorry our Inspector Greneral has already
left.
I must agree with her findings.
I have no problem with those in
many respects.
However,
I might note that many of the issues that she raised
have actually involved local custom. For better or for worse, home-
steads have never been perceived and legally required to be long-
term homesteads.
With the value of land and the competition for land, there has
been a great deal of interest in getting a homestead and then turn-
ing around and seeing how much can be made off of it. This is still,
I think, the case. There have been bills presented in the legislature
to make this illegal, but as the IG stated, this
is a fairly common
practice. It is not illegal,
I might add.
The other thing about the audit is, and the Acting Attorney Gen-
eral stated
it quite well, the issue of justifying the audits on the
basis that these lands once belonged to the United States.
As a long-term Trust Territory employee,
I am
quite familiar
with the situation under the trusteeship, and
I can say flatly the
United States never owned a square meter of land
in the Trust
Territory. And this
is a common misunderstanding that leads
to
points of friction between the Federal Government and the people
in the Commonwealth, whatever the motivations of the audit itself.
The second thing
I would point out
is that the NLRB has
re-
cently apparently—this has been reported to me—I have not been
able to actually verify
it, but my sources are quite believable—that
there
is a ruling coming down the pipeline that employers will be
required to renew their nonresident contract employees at the end
of their contracts unless they have cause to dismiss the employee.
In other words, the local control over immigration and our local
hire preference laws will be completely overturned by this kind of
regulation. We have a regulation in the Marianas which requires
every employer to hire local people first whenever they are quali-
fied, whenever they apply for a job before any nonresident workers.
And if a nonresident worker's contract expires and a local hire ap-
plies
for that job, the
local
hire person
is supposed
to get
pref-
erence.
Under this new ruling which
is coming down, and
I have seen
part of it in text, the employer will be required to rehire the non-
resident worker, which goes against everything we believe is Amer-
ican. And we think it is not right, and we would ask this committee
to look into
it. In the interest of time, Mr. Chairman,
I will cease
my comments at this time and make myself available for any ques-
tions you may have. It is kind of lonely up here.
[Prepared statement of Mr. Samuel F. McPhetres may be found
at the end of hearing.]
Mr. GiLCHREST. Well, thank you very much, and we realize you
have come a long way to testify so we want to make sure that you
get across to us the information that you feel
is important.
I just
have a few questions, and then I will yield to my colleagues.
You are saying—^because I am not sure if I understood your ear-
lier statement about whether you were or were not in favor of the
minimum wage increase. It seemed that you said you were in favor
of the minimum wage increase because that would cause employers
to be more selective as to who they were hiring, but they should
176
take into consideration those of us who are causing the minimum
wage to go up. The other benefits that the employees have, which
is food, lodging, health care, and so forth, how would that work?
Mr. McPhetres. Our position, Mr. Chairman,
is that somehow
we have to get the Marianas legislature to reduce the mandated
benefits as the actual cash wage increases.
If we maintain the
le-
gally mandated benefits, which can go up as high as $2 an hour
in benefits, in value, and the minimum wage goes up to let us say
$4.25, it is actually a $6.25 minimum wage to the employer.
Mr. GiLCHREST.
I see. So that adds a more interesting, yet prag-
matic, dimension to the issue of minimum wage. The issue of immi-
gration which you said was a problem for a number of reasons, one
of which was
the problem
of different groups
fighting amongst
themselves
in the Commonwealth,
the
difficulty
of law
enforce-
ment, the difficulty of the immigration problem because you can't
get—I suppose—I think you made
reference
to
getting—enticing
Americans to the Commonwealth as opposed to hiring people from
other nations in the South Pacific or a Asia?
Mr. McPhetres. That is correct, sir.
Mr. GiLCHREST. Do you feel that the American workers would be
more suitable, less troublesome? Why would the American workers
be better than the
Mr. McPhetres. Well, I think there are two facets to the answer
of that question, sir. The first one is we feel that the—the Chamber
particularly—feels that we really ought to get more American
in-
vestment in the Commonwealth.
I am not just talking about work-
ers.
I am talking about the overall investment pattern. We have
very little investment by citizens of the United States.
The minimum wage in this private sector discourages us from
hiring U.S. citizens in many cases because, for example,
I can hire
a 10 year experienced CPA from the Philippines for $3 an hour.
If
I add $2 an hour to that,
it
is $5 an hour in terms of benefits.
I
can hire three of those for $15 an hour.
I have to pay $15 an hour
for one U.S. citizen.
Mr. GiLCHREST. Most of the people that come in to work in the
Commonwealth
as
immigrants,
generally
speaking, what would
they be doing? Is it labor intensive?
Mr. McPhetres. No. It is everything, sir.
Mr. GiLCHREST. So there is a whole variety of things.
Mr. McPhetres. Well,
I will go back to the census.
I would defer
to whichever census is correct.
I will act on the Northern Marianas
census. We have approximately 40,000 jobs that are occupied by
nonresident workers.
Mr. GiLCHREST. Are these annual jobs or are these permanent
jobs?
Mr. McPhetres. These are permanent jobs.
Mr. GiLCHREST. 40,000 that pretty much go unfilled or they are
filled by
Mr. McPhetres. They are filled by nonresident workers.
Mr. GiLCHREST. They are filled by nonresident workers who are
by their very nature transitional?
Mr. McPhetres. Exactly.
Mr. GiLCHREST. Just one other. You bring up a lot of issues here.
Well, you just answered that one question-—40,000 workers.
I have
177
some other questions. If we have time,
I will come back. If I don't,
I will fly out to Saipan, and we can talk about it over a cup of tea.
Mr. McPhetres. We would love to have you there, sir.
Mr. GiLCHREST. Where are you from? Are you from the States?
Mr. McPhetres. Once a long time ago I was in Alaska.
Mr. GiLCHREST. Alaska.
Mr. McPhetres.
I used to work here when Senator Bob Bartlett
was the first Senator from Alaska.
Mr. GiLCHREST. Are you enjoying your stay in the South Pacific?
Mr. McPhetres. When
I
left high school,
I said
I would never
get cold again.
Mr. GiLCHREST. You would never be
cold
again. So
it
doesn't
snow there?
Mr. McPhetres. No, no, not very often.
Mr. GiLCHREST. Thank you very much.
I
will yield
to the gen-
tleman from American Samoa.
Mr. Faleomavaega. Thank you, Mr. Chairman. Mr. McPhetres,
I am just curious.
I am getting different numbers in terms of what
is the real population of NMI? Is it 45,000 or is it 60,000?
Mr.
McPhetres.
If you
are
talking
about warm
bodies,
the
CNMI census, which was just released last month, is 59,000 plus.
Mr. Faleomavaega. So it is 60,000?
Mr. McPhetres. Yes.
I noticed that Mr. Stayman quoted a
dif-
ferent figure. I am not sure, you know, what the balance—what the
adjustments are. But the census was carried out last year in the
Northern
Marianas—house-to-house
census
so
I am
relying on
that.
Mr. Faleomavaega. And in your statement, 40,000 of those are
expatriots?
Mr. McPhetres. That is correct.
Mr. Faleomavaega. Which leaves the Chamorro population of
20,000?
Mr. McPhetres. Actually,
if you look at the figures, the census
is kind of strange. They were supposed to be following the U.S. cen-
sus. However, there are some classifications there which don't
fit
very well. You go down from the top, Chamorro, Carolinian, and
white, Trukese, Ponape, and Oriental, and so you really can't get
into that. There
is a citizenship classification, and
it comes down
to approximately 20,000 U.S. citizens of which 2,000 are from the
mainland, 18,000 are Carolinian and Chamorro.
Mr. Faleomavaega.
I assume that the Census Bureau did con-
duct a 1990 census on NMI?
Mr. McPhetres. That
is
correct. The population
at that time
was 40,000.
Mr. Faleomavaega. More blessings to you because for the first
time
in 90 years
in our relationship with the United States, the
Census Bureau finally took an
official census in the 1990 census.
That is after 90 years of association with the U.S.
I have a question concerning the minimum wage again.
I asked
earlier, and
I think this
is something that
I am trying to resolve
in my own mind, about the application or nonapplication of mini-
mum wages in NMI. And
I suppose basically the bottom line—
question that
I have
is that is the cost of living in NMI about the
same as here in the U.S.?
178
Mr. McPhetres. It is much, much more expensive.
Mr. Faleomavaega. More expensive?
Mr. McPhetres. Yes,
sir. When
I go to the supermarket here,
I
have a hard time. My blood pressure rises rather quickly.
Mr. Faleomavaega. A
loaf of bread
in NMI would
cost how
much?
Mr. McPhetres. $2.
Mr. Faleomavaega. $2.
Mr. McPhetres. A melon, a cantaloupe
is anywhere from 3 to
$5.
Mr. Faleomavaega. And what
is the per capita income
right
now of the NMI?
Mr. McPhetres.
I would have a hard time answering that ques-
tion,
sir, because
I don't know whether you mean total population,
which includes the 40,000 workers, most of whom are on minimum
wage, or the U.S. permanent citizen workers, most of whom earn
well above minimum wage.
Mr. Faleomavaega. Well, this
is a real essential question that
I
have,
and
I
certainly would
love
to
ask Mr.
Sanderson—our
friends from the Interior Department if they could provide that for
the record—what is the per capita income of NMI? Because
it ties
into my problems with the minimum wage, Mr. McPhetres.
Mr. McPhetres.
I understand.
Mr. Faleomavaega. And when we make comparisons, currently,
the U.S. poverty level
is now at about what—14,000 per annum,
and the poverty level income in the United States—I am just trying
to get a mechanism here to make a sense of measurement as to
what we are talking about. The
feeling basically as
I read your
statement is that you are for the minimum wage as is currently the
law by local adoption. Right?
Mr. McPhetres. You get into a sensitive area here at the mo-
ment,
sir. The once Acting Governor last week or two weeks ago
vetoed the one law which would have raised everj^hing
for one
time at 30 cents for everybody except construction and the garment
industry, which would have left 8-21 in place, which would mean
the annual increment for everyone across the board 30 cents. That
is the one we are in favor of
Mr. Faleomavaega. Do you agree with the gentleman from the
Department of Labor saying that
it
is too costly to apply the cur-
rent system that is nov/ being used in American Samoa under the
auspices of the
Mr. McPhetres.
I agree. Yes.
Mr. Faleomavaega.—U.S. Department of Labor?
Mr. McPhetres. Yes.
Mr. Faleomavaega. You don't think that an industrial commit-
tee every two years could be organized in such a way that will give
a better measurement of the economic situation of NMI?
Mr. McPhetres. As he
said,
it would
cost three-quarters of a
million dollars every two years.
I am not sure
it
is worth that.
I
commend the Governor for hiring the Hay Group to study the mini-
mum wage issue and include—and this
is extremely important to
a consideration—that you include the government salary rates, as
well
as
the
private
salary rates because there
are two
different
worlds.
179
One of the things that has handicapped the private sector from
iis development is that we are unable to compete with the govern-
ment on the benefits package that they
offer to their employees.
And until we can consider that as a factor, we cannot attract com-
petent local workers from the government to take equivalent jobs
in the private sector.
Mr. Faleomavaega.
Isn't one of the problems also how the pri-
vate sector
is competing with the government on these extended
leases, assuming that these lands do not belong—I assume that
these tracts of lands that are given to developers and resort people,
are they government-owned land or privately owned?
Mr. McPhetres. Both. Right now,
if
I could just complete the
thought here, sir, this is one of our problems.
I talk about stability
in government. A few years ago our big issue
is what we call the
Article
12
cases, when land had been leased from—private land
had been leased to developers, found that they were being threat-
ened in Court by having their leases
nullified because of various
technicalities. This had been resolved, but in the process, a
lot of
potential investors said, "I am not going to touch this place."
The other thing that we had a few years ago was a tax law. The
tax law was passed at midnight, which would have raised excise
taxes 300 percent on the various goods, particularly aimed at the
tourist
industry. We had
people
closing down major luxury
gift
shops because they couldn't afford that. People were running away.
We are looking for stability. We are looking for something which
all comes down to one of my fetishes as a college instructor, the P
word.
If we can't get some "planning," we are going to keep going
like this.
Mr. Faleomavaega. Do you agree with the Inspector General's
assessment, the
total
losses
in revenue
potential by these
lease
agreements
in
excess
of $777
million
that the NMI
stands
not
to
Mr. McPhetres.
I have a hard time accepting that, not that
I
think that
it is wrong.
I am just not exactly sure what the grounds
are. For example, the Governor is in the process of leasing public
land for a private school. This private school
is for the benefit of
the Northern Marianas. They will be paying taxes. They will be
hiring people. They will be contributing to the economy.
Should they be paying a lease price, the same as someone who
is coming in there and building—I
will take a wild stab here—
mall which is filled with profitmaking stores and eventually will re-
turn back to the Northern Marianas in 25 years?
Mr. Faleomavaega. What
is your understanding of the recent
visit of some of the staff people from the prominent leaders of the
House when
they
visited NMI, and under whose
auspices, and
what did they hope to accomplish in their visit there with the lead-
ers of NMI? Did they meet with the Chamber of Commerce?
Mr. McPhetres. Yes, they did,
sir. We had a rather productive
meeting with them. The rest of your question
I am really not in
a position
to answer. The group
I believe was sponsored by the
Government of the CNMI. They made the schedule. We were able
to meet with them, and we tried to give them the broadest possible
view of the differing points of view which exists within the Cham-
180
ber because we are not completely unified in everything. The Gar-
ment Association, for example, is a member of the Chamber.
Mr.
Faleomavaega.
So
the
Government
of CNMI
paid
for
the
Mr. McPhetres.
I can't answer that,
sir.
I have no idea. All
I
am saying is they sponsored the group. They led them—this sched-
ule and were in charge of them while they were there.
Mr. Faleomavaega.
I would like to ask our friends again from
the Office of Insular Affairs to pursue this and perhaps hopefully
provide this for the record if possible.
Mr. McPhetres. You may want to ask the Acting Attorney Gen-
eral if he is still here.
Mr. Faleomavaega.
If he
is
still here,
I will pursue that to be
made part of the record as
I am very curious about
it. You do agree
that the total budget for NMI at this point is $220 million?
Mr. McPhetres. That
is the budget that has been submitted.
Yes, sir.
Mr. Faleomavaega. And that 90 percent is all local revenue?
Mr. McPhetres.
I have a problem with that.
I am aware that
I think Federal categorical grants coming in are close to 75 to $100
million a year. Now, whether you include that in the budget figure,
I am not a bookkeeper.
I don't do that sort of thing.
Mr. Faleomavaega. So it is more than $220 million?
Mr. McPhetres. Actual expenditures
I believe would come up
to
Mr. Faleomavaega. Maybe my question wasn't stated properly,
but it is more than $220 million?
Mr. McPhetres.
I would take a wild guess at that, sir.
Mr.
Faleomavaega.
Thank
you
very
much,
Mr.
McPhetres.
Thank you, Mr. Chairman.
Mr. GiLCHREST. Thank you, Mr. Faleomavaega. Mr. Kildee.
Mr.
Kildee. Thank
you,
Mr.
Chairman.
Mr.
McPhetres, you
seem
to have
a very comprehensive health care program
in the
Northern Marianas. From where do you attract your physicians?
Mr. McPhetres. Well, there are two separate questions
there.
There
is mandated—employers are responsible for the health care
of their nonresident employees. They are then—the employees who
go to the hospital are then—the expenses are paid for by their em-
ployers. There
is not a comprehensive health insurance program
for, you know, universal health insurance.
We have one hospital. We have about three or four private physi-
cians in private practice with their own clinics. We have the FHP,
which has
its own
clinic
for Saipan.
I am
talking Saipan now.
There are smaller clinics on the Islands of Rota and Tinian.
Mr. IClLDEE. So rather than insurance, you actually directly pro-
vide
Mr. McPhetres. In some cases, the employers provide or actu-
ally have insurance, but
it
is not legally required. The only thing
that is required is that the bills be paid by the employer.
Mr. Kildee. OK. An employee who required surgery could have
the surgery done locally?
Mr. McPhetres. Yes, sir.
Mr. Kildee. OK. And the employer
is responsible there for the
health care then of the employee?
181
Mr. McPhetres. One of our major problems,
sir,
is the seven-
day-a-week, 24-hour-a-day provision. If it were just employment-re-
lated accidents or something,
I don't think anybody would have any
problem. But
if there
is a traffic accident on a weekend, too many
beers, something like that resulting in an injury off-duty time, the
employer is still responsible.
If the employee abandons his job, the employer
is
still respon-
sible until that individual leaves the island, which reminds me,
if
I might
interject one other thing, while the
talk was about the
labor abuse, and there
is generally a widespread feeling that this
is a common issue in the Northern Marianas,
I would like to point
out that in spite of this, we have a major problem with overstayers;
that is, people whose contracts had expired.
They do not wish to return home, who remain behind, and who
are a kind of black market economy, which creates a problem for
a lot of people. And we are hoping that the LIIDS program—the
computerized program, which
is now being put in place, will help
us to resolve that problem. But I point that out to note that as bad
as things may or may not be perceived to be in the Marianas,
it
is still a very popular place for the nonresident workers.
Mr. KiLDEE. Thank you very much. Thank you
for your
testi-
mony. Thank you, Mr. Chairman.
Mr. GiLCHREST. Thank you, Mr. Kildee. Mr. McPhetres, what
is
the major industry of the Northern Marianas?
Mr. McPhetres. We have two major industries,
sir. One is tour-
ism and one is garment industry.
Mr. GiLCHREST. Which one has more employees?
Mr. McPhetres. The garment industry I believe. That has 7,000
employees.
Mr. GiLCHREST. 7,000?
Mr. McPhetres. Right.
I think there
is about five in the tour-
ism-related industry.
Mr.
GiLCHREST. You have somewhere
in
the neighborhood
of
12,000 people working in those two industries,
I would assume pre-
dominantly immigrant employees?
Mr. McPhetres. Well,
if I say that many employees,
I am talk-
ing about immigrant employees, with the exception of one factor I
should note, that the law in the Marianas requires that any com-
pany that has more than 100 employees must have 20 percent local
hire. Unfortunately, there are not enough
local bodies. The
local
workforce consists of about 8,000 people, 5,000 of whom work for
the government. So that leaves 3,000 people left to fill those 40,000
jobs I mentioned earlier.
Mr. GiLCHREST. How many residents are there?
Mr. McPhetres. Permanent residents?
Mr. GiLCHREST. Permanent residents.
Mr. McPhetres. About 20,000.
Mr. GiLCHREST. About 20,000.
Mr. McPhetres. 20—25,000.
Mr. GiLCHREST. You have about 5,000 working for the govern-
ment?
Mr. McPhetres. That is correct.
Mr. GiLCHREST. And about 3,000 working in other various capac-
ities?
182
Mr. McPhetres. That is correct.
Mr. GiLCHREST. And you mentioned earlier there
is going to be
how many hotels built?
Mr. McPhetres. Present plan there are—we have 3,000
hotel
rooms in place now.
I am using round figures. 3,000 in place now.
There
is another 3,000 under construction
or already being
ap-
proved for construction. In addition to those hotels, there
is a ca-
sino being planned—at least one casino. Two are on the boards.
Mr. GiLCHREST. You mentioned that the casinos may create prob-
lems?
Mr. McPhetres. Well, yes,
sir. The casinos are relegated to the
Island of Tinian, which at the present time has very
little
infra-
structure. There is a plan now to build a $500 million hotel.
Mr. GiLCHREST. Who is going to do that?
Mr. McPhetres. A Chinese company.
Mr. GiLCHREST. A Chinese—mainland Chinese? Taiwan?
Mr. McPhetres. From Hong Kong.
I understand
it
is a Hong
Kong company with mainland ties.
Mr. GiLCHREST. And they want
to do that because they think
there is going to be a huge tourist industry there?
Mr. McPhetres. They believe that there
is going to be a
lot of
money involved. Yes, sir.
Mr.
GiLCHREST. Now,
that Hong Kong
firm, what happens
in
three of four years from now? Will that firm
fall under the new
Chinese government? Will they retain their interest?
Mr. McPhetres. I cannot speak to that.
I have no idea.
Mr. GiLCHREST. And the Commonwealth
is welcoming this eco-
nomic boom, or do they have some reservations?
Mr. McPhetres. The feeling in the Island of Tinian—just a little
background.
1989, Tinian
is the only island that voted to accept
commercial gambling—casino style commercial gambling.
Mr. GiLCHREST. That is the only island that can accept
Mr. McPhetres. Yes.
Mr. GiLCHREST.—legally this type of activity?
Mr. McPhetres. Casino-type gambling. Yes.
Mr.
GiLCHREST.
This was
the
zoning
that
you
were
talking
about?
Mr. McPhetres. No. This a local initiative.
Mr. GiLCHREST. A local initiative by Tinian that they want this?
Mr. McPhetres. By the people of Tinian.
Mr. GiLCHREST. They want this casino and this hotel?
Mr. McPhetres. Yes,
sir. They have a law that allows up to five
of them.
Mr. GiLCHREST. Pardon?
Mr. McPhetres. They have a law that allows up to five casinos.
Mr. GiLCHREST. Now, this,
I suppose,
is a local issue. They are
happy about it?
Mr. McPhetres. They are ecstatic about it. Yes, sir.
Mr. GiLCHREST. They are ecstatic. Woo. Well,
I am glad they are
happy with
it. And you see this as a problem because sometime in
the
future
the
culture and
the whole environment
of Tinian
is
going to change?
Mr. McPhetres. Well, at one point, one of my occupations as a
consultant,
I was hired to do a socioeconomic impact study of ca-
183
sino gambling on Tinian. And we don't have enough time to go into
that in great detail but
Mr. GiLCHREST. Well, this study would include, as you said ear-
lier, or you made some mention to the fact that they didn't have
the infrastructure?
Mr. McPhetres. That is right.
Mr.
GiLCHREST. Which means
roads,
electricity, sewage
treat-
ment plant?
Mr. McPhetres. Roads, power, water, sewage
Mr. GiLCHREST. The whole ball of
Mr. McPhetres.—solid waste.
Mr. GiLCHREST.
Is there any measure to ensure that that
is in
place prior to
Mr. McPhetres. Well, as
is normal there and,
I mean,
in the
Commonwealth, investors are required
to put in their own infra-
structure. So part of the cost of this 500 million hotel will be to put
in their own water treatment plant, their own generating plant,
their own whatever else is required.
Mr. GiLCHREST. How big is Tinian?
Mr. McPhetres. Are you familiar with Manhattan Island?
Mr. GiLCHREST. Manhattan?
Mr. McPhetres. About half the size of Manhattan.
Mr. GiLCHREST. Half the size of Manhattan. How many people
live on it now?
Mr. McPhetres. 2,000.
Mr.
GiLCHREST.
2,000. What
does
the
island
look
like?
Is
it
mountainous? Is it flat?
Mr. McPhetres. It is flat.
Mr. GiLCHREST. Broad, sandy beaches?
Mr. McPhetres. Its claim to fame was to be the launching place
of the Enola Gay in 1945.
It had the largest American airbase in
the world at the time.
Mr. GiLCHREST.
It
is half the
size
of Manhattan.
Is
it subject
to
Mr. McPhetres. I am just estimating now.
Mr. GiLCHREST.—typhoons?
Mr. McPhetres. Oh, yes.
Mr. GiLCHREST. Well, that
is half a world away—actually more
than that probably. All
right. Well, this
is
ail very fascinating to
a young man from Alaska I am sure, and
I thank you so much for
your testimony. And we are grappling with this issue of—we talked
earlier today
in the
full committee about whether or not Puerto
Rico should be a Commonwealth, a sovereign State, or a sovereign
country. And
I am not sure if that will ever happen to this particu-
lar Commonwealth.
But we as the—I hate to say—I dare not say the colonial powers
of these communities out there in the far-flung Pacific, but I would
hope that we would stay engaged with these rather beautiful small
communities to ensure that the kinds of health and safety and the
quality of life issues and freedoms that we hold dear here on the
mainland are certainly extended to the lives of the people that live
out there.
Mr. McPhetres. We
appreciate
that very much, and we
will
hope that you can help us attract more Americans to come out.
184
Mr. GiLCHREST. And I think maybe there ought to be a program
because
I would venture a guess—I think
I would be safe by bet-
ting a million dollars that 85 percent of the American citizens have
no idea what the Northern Marianas
are. They might think
it
is
a community in Brooklyn, and that we actually have territories.
Mr. McPhetres.
I deal with that every day in my job, sir.
Mr. GiLCHREST.
I think if there could be a program to reach more
Americans, whether it is through the colleges or advertisements on
TV, you might have a number of young students go out there out
of curiosity, and you might even have a number of spouses finding
some place to escape to depending on what their conditions are.
Mr. McPhetres. One thing if I may add, that the public school
system
is now attracting mainland U.S.
teachers. We now,
I be-
lieve, have close to 200 on the island. Historically, they would stay
for one year, but
I think there will be five to ten percent of each
group that will stay on after that and build up a population, the
idea being not to Americanize the islands, but to try to get more
local—more U.S. citizen participation in the activities there.
Mr. GiLCHREST.
I was going to say maybe
if there
is a place for
a
retired member of Congress, but
I would have
to talk to Mr.
Meades about that to see if it is OK.
Mr. McPhetres.
I think we could arrange something.
Mr. GiLCHREST. Thank you very much,
sir, and have a safe trip
back. The hearing is adjourned.
[Whereupon, at 5:50 p.m., the Subcommittee was adjourned; and
the following was submitted for the record:]
185
104th congress
2d Session
H. R. 3634
To amend provisions of the Revised Organic Act of the Virgin Islands which
relate
to
the temporary absence
of executive
officials and
the
priority
payment of certain bonds and other obligations.
IN THE HOUSE OF REPRESENTATIVES
June 13, 1996
Mr. Frazer
(for himself, Mr. Baldacci, Mr. BiSHOP, Mr. THOMPSON, Ms.
Norton, Mr. Moran, Mr. Wynn, Mr. Hastings of Florida, Mrs. Meek
of Florida,
Mr. LuTHER,
Mr. Romero-Barcelo,
Mr.
HiLLlARD,
Ms.
McKinney, Mrs. Clayton, Mr. Rangel, Mr. Dornan, Ms. Jackson-
Lee,
Mr.
Lewis
of
Georgia,
Mr.
Flake,
Mr. Hayworth,
and
Mr.
Menendez) introduced the following bill; which was referred to the Com-
mittee on Resources
A BILL
To
amend
provisions
of
the
Revised
Organic
Act
of
the
Virgin
Islands which
relate
to
the temporary
absence
of executive
officials and the priority payment of certain
bonds and other obligations.
1
Be it enacted by the Senate and House of Representa-
2
tives of the United States ofAmerica in Congress assembled,
3
SECTION 1. SHORT TITLE.
4
This Act may be cited as the "Virgin Islands Organic
5
RevisionActof 1996".
186
2
1
SEC. 2. TEMPORARY ABSENCE OF OFFICIALS CLARIFIED.
2
Section 14 of the Revised Organic Act of the Virgin
3
Islands
(48 U.S.C.
1595)
is amended by adding at the
4
end the following new subsection:
5
"(g) An absence from the Virgin Islands of the Gov-
6
ernor or the Lieutenant Governor, while on official busi-
7
ness
shall not be a 'temporai^^ absence'
for purposes of
8
this section.".
9
SEC. 3. AMENDMENTS TO PRIORITY OF BONDS AND OTHER
10
OBLIGATIONS.
11
(a) Authority To Issue Obligations.—Section 3
12
of the Act entitled "An Act to authorize the government
13
of the Virgin Islands to issue bonds in anticipation of reve-
14
nue receipts and to authorize the guarantee of such bonds
15
by the United States under specified conditions, and for
16
other purposes", approved August
19, 1976
(48 U.S.C.
17
1574c), is amended
18
(1) by striking "priority for payment" and
in-
19
serting in lieu thereof "a parity hen with every other
20
issue of bonds or other obligations issued
for pay-
21
ment"; and
22
(2) by
striking
"in
the
order
of the
date
of
23
issue".
•HR 3«34 IH
187
3
1
(b) Application.—The amendments made by
this
2
section
shall apply to obhgations issued on or
after the
3
date of the enactment of this Act.
O
•HR 3634 m
188
104th congress
2d Session
H. R. 3635
To
direct
the
Secretary
of
the
Interior
to
enter
into
an
agreement
with
the
Governor
of
the
Virgin
Islands,
upon
request,
that
pro\ides
for
the transfer of the authority to manage Christiansted National Historic
site.
IN THE HOUSE OF REPRESENTATIVES
June 13, 1996
Mr. Frazer (for himself, Mr. Balx)acci, Mr. BISHOP, Mr. Thompson, Ms.
Norton, Mr. Moran, Mr. Wynn, Mr. Hastings of Florida, Mrs. Meek
of Florida,
Mr. LUTHER,
Mr. Romero-Barcelo,
Mr.
HiLLIARD,
Ms.
McKiNNEY, Mrs.
CLA"i"roN, Mr. Ranqel, Mr. Dornan, Ms. Jackson-
Lee,
Mr. Lewis
of
Georgia,
Mr.
Flake,
Mr. Hayworth,
and
Mr.
Menendez) introduced the following bill; which was referred to the Com-
mittee on Resources
A BILL
To
direct
the
Secretary
of
the
Interior
to
enter
into
an
agreement with the Governor of the Virgin Islands, upon
request,
that provides
for the
transfer of the authority
to manage Christiansted National Historic site.
1
Be it enacted by the Senate and House of Representa-
2
tives of the United States ofAmerica in Congress assembled,
189
2
1
SECTION
1. TRANSFER OF AUTHORITY TO MANAGE AND
2
CONTROL
CHRISTIANSTED
NATIONAL
fflS-
3
TORIC SITE.
4
(a) In General.—Upon the request of the Governor
5
of the Virgin Islands, the Secretary of the Interior shall
6
enter into an agreement with the Governor which transfers
7
to the Governor the
authority to manage
Christiansted
8
National Historic site, located in Christiansted, Virgin Is-
9
lands.
10
(b)
Contents
of Agreement.—The
agreement
1
under subsection (a) shall include provisions which
12
(1) transfer the authority to manage Christian-
13
sted National Historic
site upon a determination by
14
the Secretary of the Interior that the Government of
15
the Virgin Islands has the financial ability and com-
16
mitment to maintain and operate the site without fi-
17
nancial assistance from the Federal Government;
18
(2) retain for the United States fee
title to
all
19
property comprising Christiansted National Historic
20
site;
21
(3)
require
the Government
of the Virgin
Is-
22
lands to continue to use Christiansted National His-
23
toric site for the purposes for which it is used on the
24
date
of the
enactment
of
this
Act,
in
accordance
25
with standards and plans approved by the Secretary
26
that shall be specified in the agreement; and
•HR 3636 m
27-245 0-96-7
190
3
1
(4)
authorize
the
Secretary
to
terminate
the
2
agreement and revoke
authority transferred by the
3
agreement,
if the Secretary finds that the Govem-
4
ment of the Virgin Islands is not complying with re-
5
quirements under paragraph
(3) or
is otherwise not
6
in comphance with the agreement.
O
•EOt 3636 m
191
Statement of Governor Roy L. Schneider
HR 3634 & HR 3635
Mr. Chairman and distinguish members of the Committee.
I am here today to address two
bill that affect the Virgin Islands. But before
I
take up the business at hand, let me take this opportunity to personally thank you,
Mr. Chairman, for all the help you provided immediately after the storm. We need-
ed you and you were there. Our recovery would not be possible were
it not for your
involvement and attention and understanding. Your ability to deal with the Federal
Emergency Management Agency has certainly worked to our benefit. And
I want
to particularly thank you for your follow-up visits to the Virgin Islands to make cer-
tain we are continuing to receive the assistance so necessary after a disaster of this
size.
We are also grateful to Chairman Don Young who found the time to come to the
Virgin Islands and see
first hand the damage caused by Hurricane Marilyn. And
thank Gk)d for us that his interest in our problems did not end there. One of the
bills before you is a direct result of Mr. Young's observation of the
difficulties we
are having coordinating our plans for the town of Christiansted with the use and
management of the National Historic Site at Fort Christiansvaern. You might say
that HR 3635 is just what doctor ordered.
Let me give you some background. On our big island of St. Croix, the largest town
is
Christiansted.
When
the
Danes
built
this
town
they
constructed
Fort
Christiansvaern to protect it. This is now a National Historic Site.
The town and the Fort grew up together. Christiansted itself has actually grown
around the Fort, enclosing it. They are so close that the parking lot is the only land
between the wall of the Fort and the main business area of the town.
Since the
direct hit of our
first Hurricane—Hugo
in 1989—the economy of St.
Croix and Christiansted has suffered. Plans were made to renovate the entire wa-
terfront, creating an attractive new shopping area. We have started construction.
The boardwalk is underway. The King's Alley project is near completion. There will
be historic lighting and street signs. We will have landscaping and park benches.
Everything will be tied into a coordinated revitalization of downtown Christiansted.
I am attaching to these remarks a two page summary of the details of our plan.
I also present to you a computer rendering of the waterfront area so you can see
what it is that we plan to do and are doing.
Now, Mr. Chairman, the biggest roadblock to our plans has not been money, as
you might have expected.
It has been the National Park Service. They don't want
to cooperate. There are times
I have wondered if they even possess common sense.
Take the boardwalk for example. In order to tie the heart of Christiansted with
its eastern historic district of Gallows Bay,
it is logical and necessary to extend the
looardwalk continuously from one to the other. This means the boardwalk would fol-
low the waterfi-ont around the base of the Fort. There would be no destruction of
the Fort, its walls, or any of its property. A simple boardwalk would take the visitor
from one end of Christiansted to the other. But the Park Service said no.
It wasn't
historic. Because no one had ever done it before it couldn't be done now. This is non-
sense.
It would mean the boardwalk must be interrupted. A stroller must leave the
waterfi-ont, hike all the way around the Fort, and continue on the other side.
With HR 3635, the Virgin Islands could make a simple management decision to
have one continuous boardwalk. But this is only one example of how the Park Serv-
ice is separating the town of Christiansted fi"om its historic alliance and union with
Fort Christiansvaern. We are having problems with the use of the parking
lot.
It
cannot be used, according to the Park Service, to load and unload passengers from
taxi vans. Yet it is the only safe and convenient place downtown to do
so. Nor can
the lot be used for holiday events Uke the historic Christmas Festival. We get bu-
reaucratic double-talk when we ask.
The long and the short of it is that management of Fort Christiansvaern by the
National Park Service has been like having a part of Christiansted declared foreign
soil. HR 3635 would require the Secretary of the Interior to enter into an agreement
with the Governor that puts management of the Fort back in the hands of the Gov-
ernment of the Virgin Islands.
Congress does not give up ownership of the property.
It does not provide money
for the operation and maintenance of the Fort. Those responsibilities are passed to
the Virgin Islands.
If we do not maintain the Fort, the Federal Government takes
over again. But we will do our job, and
I believe we will do it better than the Park
Service. Fort Christiansvaern will once again become user-friendly for the people of
St. Croix as well as the non-resident visitor.
192
We already have plans to raise money from parking fees at the parking lot. This
is the same
lot that the previous Governor tried to light, at our expense, but the
Park Service said no. What is wrong with lighting the parking lot? Why not eUmi-
nate a dark area in the downtown Christiansted? This is the lot where a few years
back a young woman was raped at night and a tourist was shot and killed.
I know the Park Service will oppose this
bill. They don't trust us to manage this
property and manage
it well. But right now what we are doing in Christiansted
looks better and has
better care than the
Fort. We repaired our storm damage
quicker then the Park Service. And we will take care of the Fort which is central
to the Christiansted revitalization.
I am sorry for the deterioration of relations between the Part Service and the peo-
ple of Christiansted.
It shouldn't's be this way. The Fort and the town are one. Yet
the Park Service has acted
like a bad corporate
citizen. There
is a Big-Brother-
Knows-Best attitude that has driven a wedge between the "feds" at the Fort and
the people who live in and around Christiansted.
Let us manage the Fort as HR 3635 proposes.
If we don't improve the property
and bring
it back to life, then you can take
it back. But let us try.
I know we will
succeed.
The
second
bill
before
this Committee
is HR
3634.
It makes two
important
changes in the Organic Act of the Virgin Islands. Oiu" Delegate, Victor Frazer, was
kind enough to introduce this bill as he did HR 3635. But
I readily admit the rec-
ommended changes to the Organic Act are my own.
One of my first concerns upon becoming Governor was the realization that each
and every time
I left the Territory the powers of my Office fell to someone else. Usu-
ally this
is the Lt. Governor, but not always. When the Lt. Grovemor is also off-is-
land, a succession of Cabinet officials become "acting" Governor depending on which
of them is physically in the Territory.
The Organic Act requires this transfer of powers.
It was enacted at a time when
communications were not as immediate and reUable as they are today. Now
I can
be reached anywhere, even at my seat while flying on commercieil aircraft. Fax ma-
chines and portable phones are common.
I am in continual contact with my staff
in the Territory and know about problems and policy choices as they arise.
Travel is often important and required when doing the business of the Territory.
Sometimes the Lt. Grovemor or a member of the Cabinet or both can accompUsh the
task that demands travel. But often it is the Governor who must appear before the
Congress or negotiate with the head of the Federal Agency. When we needed a Dis-
aster Loan, who but the Governor could or should have appeared before you? The
point is simple. Governors are required to travel. In doing so they should not be con-
cerned about disrupting the continuity of their operation of the Executive Branch.
The President does not give up his powers when traveling outside Washington or
away from the nation.
There are those who have speculated that this request for a change is indicative
of a lack of trust between the Governor and the Lt. Governor. Their speculation is
shortsighted.
It overlooks the times when a Cabinet Officer is left in charge.
It fails
to realize that not everyone in the Une of succession can be briefed on each and
every issue that may arise during the absence of the Governor.
The Governor
is a lightening rod for information and ideas. He usually has the
most current and reliable information before making a decision. He knows the sta-
tus of negotiations and who
is calling the
shots. This fact has no better example
than the intricate process of obtaining a Community Disaster Loan.
I have been in-
timately involved with FEMA and my own Administration in working out the de-
tails of this critical loan. It would not be possible to brief each Gubernatorial succes-
sor on every phone call and decision made during this process. Not to mention that
the
federal
officials involved would want
to know
if each "acting" Governor was
making decisions based on
all the conversations and information made available to
the Governor.
This uncertainty
is unnecessary. Modem communications have made
it easy
to
keep in touch. The powers of the Governor can be retained in that person, wherever
he or she might be. The first amendment to the Organic Act made by HR 3634 does
just that.
I made a decision to recommend this change after the frequent travel re-
quired of me after Hurricane Marilyn.
The second amendment would allow the Virgin Islands to obtain parity debt in-
stead of priority debt. The Organic Act now requires that
all bonds of the Govern-
ment of the Virgin Islands secured by the Matching Fund be issued on a priority
basis. This means that early bond purchasers have a priority over subsequent
is-
sues. Thus, as the Territory issues debt,
it becomes more and more expensive as
each new bond issue requires additional premiums and over-coUateralization to pro-
tect the subsequent creditors from the priority issues before them.
193
Most States and communities are not locked into requirements for priority debt.
They issue parity
debt. Each new bond
issue stands equal
to the others and
is
collateralized only to the extent necessary to secure the debt.
In this amendment, the Virgin Islands would be permitted to issue parity debt.
Thus
it would compete on
a
level
playing
field with
other communities
issuing
bonds. Since we now have a proven track record in the bond market. It is no longer
necessary for the Congress to require that our bonds be doubly protected. We have
not defaulted on any of our bond issues. Our cvirrent rating indicates we are not
likely to do
so. An authorization to switch from priority to parity bonds
is fair to
the Virgin Islands.
Now let me tell you why parity bonds are important to the Virgin Islands. With-
out them,
it will be too expensive
to issue more
debt.
If we cannot borrow more
funds, we cannot build the new schools and improve public facilities that are now
required after Hurricane Marilyn.
Of course FEMA will restore public buildings to their pre-storm condition. And
it will make improvements under the hazard mitigation section of the Stafford Act.
But a school with a pre-storm life of only two or three years shovildn't be put back
the way
it was. Not
if, as planned,
it was scheduled for replacement or improve-
ment. The storm simply accelerated our need to replace the old schools. To build
those schools and other public bmldings,
I need bond proceeds. We also are under
a Federal Court Decree to build a new jail. We have no funds for construction costs.
Parity bond authority will allow the Virgin Islands to go to the bond market without
penalty of over-coUaterahzation.
Mr. Chairman, those are the reasons
I support HR 3634 an HR 3635. They are
good bills. They allow the Virgin Islands to be more self-governing.
Thank you and the members of this Committee
for considering this legislation.
And please again accept my thanks and that of the people of the Virgin Islands for
all you did to help us after the hurricane.
I am sorry so many natural disasters in
yoiu- own District have made you such an expert on the Stafford Act, Mr. Chairman.
But
it has certainly been of benefit to the Virgin Islands to have such an experi-
enced disaster-fighter at the helm.
CHRISTIANSTED WHARF REVITALIZATION PLAN
Restoration of the Christiansted National Historic Site to a mid-nineteenth cen-
tury appearance is an admirable effort by the National Park Service but not a real-
istic approach to an area that is playing a key role in the central business district
(CBD) or Christiansted.
Addendum three amended the original memorandum of agreement between the
National Park Service and the Government of the Virgin Islands by agreeing
to
eliminate two parking areas, among others things, that would have an adverse im-
pact on Christiansted. The areas in question are:
•
The area bounded by King Street, the Steeple Building, the Wharf, Hamilton
Jackson Park and the Custom House.
•
The area east of Hospital Street and west of Fort Christiansvaem.
In assessing the proposed changes one must consider the role Christiansted Wharf
plays in the ftinction of the town as the business center, employment center cultural
center and tourist center on the island of St.
Croix.
It
is a key element not only
as a major parking lot providing parking for customers in the CBD, but as a focal
point for various activities that have made Christiansted the town that is
it today.
Activities such as our cultural Christmas
festival parades,
civic and military pa-
rades, concerts, modern dance street performances and multi- ciiltural activities, the
main pick-up and drop-off point for tourists contributing to our growing tourist in-
dustry and a point of departure for tourists to shop downtown, the Women Race,
the triathlon transition eirea, and fireworks activities to name a few.
This
is today's Christiansted and the wharf is where
it all happens. Restoration
of that area must incorporate the vision of today and the days to come, not solely
the appearance
of the mid-nineteenth
century.
Today's
function
of the area
far
outweight that the past.
The Government envisions a restoration plan that complements the area's present
role in the scheme of things, yet
still maintains the integrity of the National His-
toric Site. In addition the plan incorporates the following:
•
The proposed boardwalk along Christiansted shoreline.
•
Activities that would
cater
to the
tourist industry such
as
cultvu*al
events,
buggy rides originating in the area, etc.
•
Urban furnishings with a historic quaUty throughout the area.
•
Vendor activities.
194
•
Resurfacing the Hospital Street with sidewalk and resurfacing of streets with-
in the historic site.
•
Restoration of the Scale House and the Old Custom House to their mid-nine-
teenth century appearance.
•
Landscaping and hydroseeding of lawn areas.
•
Restoration of the
historic well
at the comer of Hospital Street and Queen
Street as a fountain or other.
•
Decorative historic chain fences in various areas.
•
Restoration of the Thurland Home that is unique in its historic architecture.
•
Wedding picture backdrop/open theater (Shakespeare in the park).
•
Historic street signs.
•
Parking accommodations.
With respect to accommodating parking that would be eliminated in the wharf,
and in keeping the idea of more grassed area on the historic site, the parking area
east of the fort will be enlarged and improved to have a surface constructed of bricks
that would allow grass to grow between the bricks thereby given the appearance of
a grassed area. This parking lot will be structured and managed as a pay parking
lot.
It
is estimated that $125,000 in parking fees can be generated each year and
will be used to fund maintenance of the historic site.
Statement of Allen P. Stayman
Mr. Chairman and members of the House Subcommittee on Native American and
Insular Affairs,
I am pleased to be here today to discuss the provisions of H.R. 3634,
and the Second Annual Report on the Federal-CNMI Initiative on Labor, Immigra-
tion, and Law Enforcement in the Northern Mariana Islands. With regard to the
park issues raised H.R. 3635, a representative from the National Park Service
is
here to discuss them.
H.R. 3634
Section 2 of H.R. 3634 provides that neither the Governor nor Lieutenant Gov-
ernor of the Virgin Islands need relinquish authority while traveling outside the
Virgin Islands on Government business.
When the Revised Organic Act was enacted, transportation and communications
were far more limited than today. Therefore, it was necessary for a governor or lieu-
tenant governor,
respectively, when travelling,
to delegate authority. Today, how-
ever, with instant, world-wide communications, an elected official can fully execute
the
duties of office even while not physically present in the
territory.
Section 2
would amend the Revised Organic Act to construe the term "temporary absence" so
as to not include the Governor's or Lieutenant Governor's physical absence from the
territory while on
official government business. In light of today's technology, the
proposed amendment is appropriate.
THE ADMINISTRATION SUPPORTS ENACTMENT OF SECTION
2.
Section 3 of H.R. 3634
deals with the bonding authority of the Virgin Islands
when
its bonds are secured by the coverover of Federal excise taxes on rum. The
provisions would allow the Virgin Islands to issue parity debt, rather than priority
debt. Current law gives greater protection to earlier issuances of debt over later
issuances, with the result that later debt is subject to increased interest and fees.
We understand that most local jurisdictions now issue parity debt instruments. The
bonding provisions of Section
3, for the future, would place the Virgin islands on
a footing similar to other communities.
The Administration has no objection to the enactment of section 3.
FEDERAL-CNMI INITIATIVE LABOR, IMMIGRATION, & LAW ENFORCEMENT SECOND
ANNUAL REPORT
The Federal-CNMI Initiative on Labor, Immigration, and Law Enforcement was
funded with a $7 million appropriation by the Congress in PubUc Law 103-332. The
Administration issued
its second annual report on the Initiative on June
4,
1996.
We believe that the ten-page report with executive summary and recommendations
brings the reader up-to-date on progress m the CNMI.
The goals of the Initiative, which are implied in the Initiative's name, are to:
•
aid the CNMI in building institutions that protect against illegal labor prac-
tices and ensure fair treatment for all workers,
195
•
assist the CNMI in enforcing its immi^ations laws, and offer options for action
should immigration continue unabated (with resulting
societal and infrastructure
costs), and
•
improve CNMI and Federal law enforcement
capabilities through additional
funding and staffing, and new prison facilities.
In the report, we note that the combined efforts of the Government of the Com-
monwealth of the Northern Mariana Islands (CNMI) and Federal agencies are mak-
ing progress in fulfilUng the goals of the Initiative. Governor Tenorio has strongly
endorsed the CNMI's actions and the increase in Federal law enforcement presence.
The Federal agencies and the CNMI are working cooperatively, with the Office of
Insular Affairs acting as an ombudsman,
to fashion appropriate responses
to the
consequences of enormous growth in the CNMI. However, sustained follow-through
from both the local and Federal governments is needed if Initiative goals are to Be
achieved.
RECOMMENDATIONS
I would like to highlight for the Committee the recommendations contained in the
Initiative report. The Federal agencies participating in the Initiative recommend:
(1) that the Congress finahze enactment of section 2 of S. 638 to estabUsh the
minimum wage in Federal law including the annual 30-cent increases in the mini-
mum wage contained (until very recently) in CNMI law, and
(2) that the Congress direct the CNMI to utilize Covenant funds for prison and
detention facilities.
On minimum wage, CNMI workers, at present, lack Federal minimum wage pro-
tection, with the result that the Department of Labor is limited to enforcing only
the overtime provisions of the Fair Labor Standards Act (FLSA).
S. 638, which
is
before this subcommittee for action, anticipated possible CNMI backsliding on the
minimum wage issue, and incorporated CNMI's annual 30-cent increases. Despite
this congressional action, however, CNMI wage policy continues in vacillation. First,
the 30-cent increase scheduled
for last January was delayed
to July
1. More
re-
cently, the CNMI Legislature rolled back the 30-cent increase
to 15-cent for gar-
ment and construction workers, and eliminated all future scheduled increases. Cur-
rently, there
is a dispute in the CNMI as
to whether or not this minimum wage
rollback bill was signed to vetoed.
S. 638 would bring fairness and stability to CNMI wage rates and important new
revenue to the local government. The 30-cent increases were enacted by the CNMI
Government and continue to the endorsed by the CNMI Chamber of Commerce, the
Contractors Association and the Hotel Association. The only opposition is from the
garment industry, which, despite
its claims of hardship, continues to expand—new
companies have been granted licenses and production continues to soar. Garment
imports from the CNMI increased 30 percent in 1995 to $426 million and rose over
40 percent in the
first two months of 1996 over the same period last year. Other
American Pacific jurisdictions, Hawaii and Guam, have proposed for decades while
paying minimum wages either equal to or higher than the Federal minimum wage.
The CNMI can similarly prosper, and we need not resort to the costly bureaucratic
mecharusm of the Federal Wage board. We believe that passing more of the benefits
of the CNMI's economic growth on to the workers who make that growth possible
is an important part of our joint efforts to respond to the tremendous growth and
change which the CNMI has experienced over the past fifteen years. Mr. Chairman,
the Administration urges that the House of Representatives take positive action on
S. 638.
With regard to incarceration, existing prison and detention
facilities and proce-
dures are woefully inadequate.
It is commonly believed that faciUties in the CNMI
accommodating 200 persons are necessary. One item on our agenda for this coming
year
is the work with the CNMI
for specific determinations of need and capacity.
In the meantime, the Administration recommended in the report that the Congress
stipulate that existing CNMI Covenant funding be devoted, as first priority, to pris-
on and detention construction. We understand that Governor Tenorio
is amenable
to using fiscal year 1995 Covenant funds for this purpose, and we look forward to
CNMI legislative action on this matter.
AGENDA
During this next year the Initiative agencies will deal with a number of issues,
including immigration. New census figures show that the CNMI population grew in
the
fifteen short years from 1980
to 1995 from
18,000
to 60,000, and that in the
process, the indigenous population shrank from 72 percent of 38 percent of the total
population. With regard to the imposition of immigration controls, it should be noted
196
that the Immigration and Nationality Act (INA) may not fully address the immigra-
tion problems in the CNMI. Full application of the INA could have unintended eco-
nomic consequences for the CNMI. However, should the CNMI not establish more
effective control of immigration by early next year, the Federal agencies participat-
ing in the Initiative will develop options to increase the Federal role in CNMI immi-
gration. In developing these options, consideration must be given to local
self-gov-
ernment and local economic needs.
To summarize, the
Initiative
is moving toward
its
goals.
First, with respect
to
labor,
local
labor department
officials
are
receiving training
for recognizing and
dealing with illegal employer activity, the Department of Labor continues
its wage
hour investigations. National Labor Relations Board caseloads are up substantially,
and the Administration continues
to recommend that the Congress support wage
stability with enactment of S. 638 and the CNMI's 30-cent annu£d minimum wage
increases into Federal Law. For immigration, the new computerized tracking system
is moving from prototype to implementation, and
if necessary, Initiative members
in the next year will develop options for increasing the Federal role in immigration.
With regard
to law enforcement, dollars are up,
staffing
is up, and caseloads are
up. Additionally, the Administration recommends that prison and detention
facili-
ties be constructed with funds available under the CNMI Covenant.
Mr. Chairman, over the past year the Initiative has a record of accomplishment.
But more importantly,
for this year,
it has had an agenda for action. We believe
that the Initiative's goals will be met
Statement of Roger G. Kennedy
Thank you for the opportunity to offer the Department of the Interior's views on
H.R. 3635, a
bill to direct the Secretary of the Interior to enter into an agreement
with the Governor of the Virgin Islands to transfer authority to manage Christian-
sted National Historic Site.
Mr. Chairman, we oppose enactment of H.R. 3635
for two basic reasons.
First,
H.R. 3635
is essentially a national park closure
bill. As we have stated before, we
do not want to begin the process of parcelling out units of the National Park Sys-
tem. Needless to say, transferring this unit to the Government of the Virgin Islands
would set a bad precedent. Also, we are concerned that the Grovernment of the Vir-
gin Islands is not equipped to manage a nationally significant cultural site.
At Christiansted National Site the public learns about the role of Denmark in the
colonization and subsequent development of the Virgin Islands. The bmldings them-
selves are tangible reminders of a segment of America's heritage that is rapidly dis-
appearing. Located on Saint Croix,
it is one of four units of the National Park Sys-
tem in the United States Virgin Islands and provides operational support for an-
other one of the parks in the islands, Buck Island National Monument.
As a
resxilt of a grass-roots petition to seek national recognition of the
site, the
Secretary
of the
Interior
designated
the
Virgin
Islands
National
Historic
Site
through the order of March
4,
1952.
It was redesignated by the Secretary's Order
of January 16, 1961, as Christiansted National Historic Site. A series of memoranda
of agreement outline the relationship between the Virgin Islands Government and
the National Park Service.
The 1952 agreement established the cooperative spirit between the two entities.
The five subsequent agreement defined the various roles and responsibilities of the
National Park Service and the Government of the Virgin Islands regarding such
subjects as museum exhibits, use of the buildings, restoration of the historic scene,
and control of traffic.
In February of 1995,
I appeared before the Subcommittee on National Parks, For-
ests and Lands to oppose a bill that ceiUed for a study of the National Park System
with a view toward deauthorizing certain units. Passage of H.R. 3635 would, in a
small but dangerous way, begin that process. Each of the 369 units of the National
Park System in 49 states, the District of Columbia, American Samoa, Guam, Puerto
Rico, and the Virgin Islands was established by an Act of Congress, Presidential
Proclamations, or Secretsiry's Orders. They represent the initiatives of Congress and
numerous Administrations to preserve and protect our Nation's natural and cultural
heritage and to provide for recreational opportunities. All of these units represent
diverse public resources under our permanent stewardship
for the use and enjoy-
ment by present and future generations. Without the laws, proclamations, and or-
ders that established our parks, it is possible that many of our nationally significant
resources would be lost forever.
All 369 units of the system are nationally significant in their own right. Whether
it is Yellowstone, Glacier, and Independence National Historical Park, or Christian-
197
sted National Historic
Site, each place
is important, not just to a few individuals,
but to all of us.
The National Park Service and congressional leaders of the past intended that the
system be broadly representative of diverse natural and cultural elements of our na-
tion
Clearly, Christiansted National Historic Site represents a chapter in our na-
tion's history not found anjrwhere else. And clearly. Congress has entrusted the Na-
tional Park Service to manage these resources in perpetuity.
If the stewardship responsibiUty of Christiansted National Historic Site were to
be transferred
to the Government of the Virgin Islands,
it could be viewed as an
indication that the national significance of this valuable resource no longer exists.
We also question the Government of the Virgin Islands' ability to manage this re-
source to the standards ettabUshed in the National Park System. We wonder wheth-
er the territory possesses both the expertise and the financial resources to manage
the park well. The territory's record of managing cultural sites in uneven at best.
The Government
of the Virgin
Islands' parks
are geared toward
active, day-use
recreation, like ball fields and basketball courts, and we applaud the territory's
ef-
forts
for providing these
services. However,
its administration of its two
ciiltural
sites. Fort Frederick in Fredericksted and Fort Christian in Charlotte Amalie, falls
short of the standards set by the National Park System. In 1984, the territory as-
sumed
title and control of Government House, a structure located within the na-
tional historic
site. Unfortunately, the territory has not been able to maintsiin this
structure
adequately.
Furthermore,
we
understand,
that
within
the
last
size
months, the Governor proclaimed that the territory should not undertake any new
obUgations because of its financial burdens.
Additionally, we are concerned by indications that one of the territory's reasons
for desiring management control of the
site
is economic development. Certainly
it
is within the Governor's purview to stimulate economic development in the terri-
tory—it is sorely needed, but not at the expense of the historic
site. The territory
has developed plans to construct a boardwalk neeir the Fort and an earlier plan pro-
posed to build a restaurant in the commandant quarters of Fort Christianvaern. The
National Park Service's job is to protect the nation's heritage for current and future
generations, not to promote economic development.
As Assistant Secretary Frampton stated in a recent letter to Governor Schneider,
the National Park Service fully supports partnerships as part of the effect to pre-
serve the outstanding resources in the Virgin Islands. We will be pleased to work
with the Governor to resolve the issues of concern to him and to preserve the com-
patibility of the Fort and the town.
Mr. Chairman, this concludes may prepared remarks.
I would be pleased to an-
swer any questions.
198
EAU/jvExuxocroBatmm
B»:g«8»«afag}meg
EPnoBms
PETER FERRAKA
Tinkering
with the
success
ofKberfy
Tihere% one part of the Unit-
ed Stsies that has e^joye<l a
soaring economy
since
.
ilMO, incltKUnenine con-
Mouttve yeaes of growth at an
Incml&jle 13 percent or more.
Uh part of our country where
anmul insomes fiir workers have
more tfaAn doabled, while the
wnwnptnymeat rate has plummet-
ed Iram IS petoent to. 4 percent
Gross
domestic
product
has
Increased more tlian fourfold, yet
inflodoo is virtually nonexistent
^Vbeie is tids economic paradise?
It% the CoQimmonwealth of the
Nortiiem Marianas Islands, the
smallest and most distant US. pos-
'session, "where" America's day
begins." Rsr tiie past IS years, the
CNSO b^s been a laboratory of lib-
erty, a vibrantly'successful experi-
Tbxes were slashed
to minimal levels,
wUh noproperty,
sales or inheritance
taxes at all Income
taxes were cut by 90
percent
ment in the unregulated &ee market
But all is not well in paradise.
The response ofthe Clinton admin-
istration to this booming economic
success has been to try to shut
it
down.
The United States Uberated these
islands from Japan during World
War U, in some of the most brutal
fighting of the entire war. From
1945 to 1978, the Northern Mzri-
4nas Islands were a trust terri'ory
of ttie United Nations, under the
Crotection ofthe United States. But
1 197S, tlie islands overwhehning-
lycbose to sever tiieir ties with the
United Nations and to become an
Americancomiaaon«aItlLThe peo-
ple of HiC Nortliem Marianas ere
iwwC£citbsetis.
In
1978,
wiiea
Wasiiington
tonaedoaBtntovertD the new Oopi-
monnealtii gtmttiunent, tlie i^atids
suffered witii a fragile subsistence
economy.Avenge personal income
was fiu-bdmr the povertyline. Most
roads were tmpaved. Electtidty
was
unreliable,
with
regular
brownouts and blackouts. Most
houses did not even have nmning
water
How did dieNortlism Marianas
achieve such a rem«dcable tum-
anxmd? They did it tlie old £Bsh-
ioned way: five maiicet capitalism.
Beseoting the history «f teavy-
banded bmeancratic control firem
Washington,
and
seeing
the
remarkable success of the
firee
mailcetAsian tigerssuch as Japan,
Thtwan and Koiea, die young OS.
mniiiKiiiwealtfa adopted a radical
free matfcet regime.
Vdbbs were slashed to minimal
levda, with no pn^erty, sales or
Inhwrttance taxes, at all. Income
taxes were cot by 90 percent Cap-
ital gains taxes were assessed at
less than half tiie US. rate. Con-
troUing tiieit own customs, tfaey
diminatffd dtdies and taiifiEs,'and
dfldiNl eneifie tanteg tn a minimum
The Northern Marianas also
opened their doors
to
foreign
investors, with virtually no restric-
. tions on investmentand capital Bow.
Th^ also a<lopted' an open door
policy
fiir fwdgn labor, allowing
businesses to freely hire foreign
"guest wotloteB."
Regulatoiy burdens have been
minirnh<y1
Licenses and permits
for fiordgn entry, new businesses,
construction and development are
quickly and easily granted.
Incorporating and starting a new
business is actually simpler and
easier than in most U.S.
states.
Every other regulation under local
control has been rationally restrict-
ed to avoid harming economic
growth.
The results, injust IS years, have
been described above. This US.
commonwealth has enjoyed excep-
tional sustained economic growth,
a steadily rising standard of living,
and dramatic increases in
life
expectancy and the average level of
education. Once a dismal outpost of
failed state socialism, the islands
have now been thoroughly inte-
grated into the dynamic economy of
the Pacific Rim.
Tae
Clinton
administration
should be nnrtoting tlieCNMI as a
model for eoooomic devidopmeot
But, instead, it is ttyisgto subvert
or reverse tite local, policies that
have provided tliis success.
Tbe admiidstratioa is seddng to
impose the {ederslobknumwage
on tiie CQmiiiaoweaUi,eTCathough
it hasbeen prpvento desti«7j(Aein
such Iowe^cost «<«o~w>«« mote
efiOdenfly titanboofaliigbytfae US.
Air Riroe. Ttisym aMUica Ced-
eralgovernmenttdasoverdcimioi-
gratkn, fritfa.a-voir to s|adi tfie
nnnaier o( &MgDjaut WQiieers
dlowed in. Tlds wiudemtaiB tbe
local eooooBiy, «s tbe HdttiMm
Marianas do not have nearly
enoagii Sndigeaoeg labcc to meet
Hie boomiiig demand.
Mr. Cllntonls-bareaacrats also
want to takeamy local ooatTol over
customs and import restrlctians.
lliey are demanding that tfie oom-
moowealdi government sharply
increase taxes, ostesjsiblvto reduce
their reliance on US. aid. But the
facts are iiatd to some in Wasii-
ington to aot^b Tiie idands ere
alretidy almostindepeadintofCad-
eral monqr, and have oflEered to do
without It aUoee&ac
The rationale fordiis virtual dec-
larationofwari^tbaCafBwcmpIay-
ers in the US. oaamManwaHhhave
.engaiged in Severe labor abuses,
partiailady offoreign guest wattc-
ers.Intnitn, a>8ise acdflnaa»e«lm-
'ply crimes, and siionbl be prose-
cuted as sndLSot'liie idsids are
the only US. JurisdMlan that tas
neltiig aUS. mmsfaal aprafcder-
al ptesecutor anlgned Aere.
EarliertJiisyeai;the govenior of
the Northern M«w«n|i« offered
this deal in congressionartestiino-
iqr. Tlie US. government can keep
die $27 mOlkn per year itls pcD-
viding in assiitfatwe far (hw islands
In return, the commonwealth
would continue to keep local con-
trol over taxes, immigration and
regulations, >««?ini<i>ig die mini-
mum wage.
The Republican Congress should
take the governor up on. his offer.
Then it should use part oftiie money
for true law enforcement in the
Northern Marianas, indiidinga fed-
eral martial and federal prosecutor.
Newt Gingrichandcompany should
adopt this cause, and save ttie oidan-
gered laboratory of liberty.
Peter J. Ferrara is a seniorfellow
of the National Center for Policy
Analysis.
199
Prepared statement of Wilma A. Lewis
Supplemental
Sheet
for the Testimony
of:
Wilma A. Lewis
Inspector General
Department of the Interior
1849 C. Street N.W.
Washington, DC 20240
Phone:
(202) 208-5745
Hearing on the Federal-Commonwealth of the Northern Mariana Islands
Initiative on Labor, Immigration, and Law Enforcement and Related
Northern Mariana Islands Legislative Reforms Before the
Subcommittee on Native American and Insular Affairs,
Committee on Resources,
U.S. House of Representatives
June 26, 1996
Summary of Testimony
- Discussion of audit reports issued by the Department of the Interior's Office of Inspector
General to the Commonwealth of the Northern Mariana Islands during the past three years:
- Management of Public Land
- Stams of Improvements
in Financial Management and Program Operations
- Assessment and Collection of Income Taxes
- Income Tax Revenues
- Contracting and Contract Administration, Commonwealth
Utilities Corporation
- Utilities Rate Structure, Commonwealth
Utilities Corporation
- Followup of Recommendations Concerning Capital Development Funds
- Followup of Recommendations Concerning the Economic Development Loan
Fund, Commonwealth Development Authority
- Followup of Recommendations Concerning the Economic Development Loan
Fund, Mariana Islands Housing Authority
- Stams of recommendations made
in the audit reports.
- Long-range audit strategy of the Office of Inspector General for audits of the
Commonwealth of the Northern Mariana Islands.
- Comments regarding the importance of oversight hearings as they pertain to the resolution
and implementation of Inspector General audit recommendations
in the insular areas.
200
Mr. Chairman and members of the House of Representatives Subcommittee
on Native American and Insular Affairs, Committee on Resources:
I am pleased to be here today to provide comments for the hearing on the
Federal-Commonwealth of the Northern- Mariana Islands initiative on labor,
immigration, and law enforcement and related Northern Mariana Islands
legislative reforms.
Specifically,
I have been asked to comment on audits
performed in the past 3 years by the Department of the Interior's Office of
Inspector General in the Commonwealth of the Northern Mariana Islands
(CNMI,
or
the Commonwealth).
I have been asked
to
include
in my
testimony a discussion of:
(1) our most receht CNMI audit report, issued
in March 1996, on the management of public lands in the CNMI and (2) the
response and constructive actions, or lack thereof, by the Commonwealth to
resolve issues raised in our audit reports.
I also have been informed that I may be asked questions pertaining to certain
ongoing disputes regarding property interests on Water Island in the United
States Virgin Islands.
I have decided
to recuse myself from this matter.
Prior to my current position as Inspector General,
I served for 19 months
as
the
Associate
Solicitor
for
the
Division
of
General Law
in
the
Department's Office of the Solicitor.
During my tenure as the Associate
Solicitor,
staff whom
I supervised,
in conjunction with the Department of
Justice,
served
as counsel
for
the Department of the
Interior
in
related
litigation
involving Water
Island.
Accordingly,
in order
to protect
the
integrity of my
position and of the Office of Inspector General,
I have
delegated
all
decision-making
responsibility
regarding
any
Office
of
Inspector General involvement in ongoing Water Island matters to Richard
Reback,
Chief of Staff and General Counsel
in
the
Office
of Inspector
General.
I therefore request that any questions regarding Water Island be
directed to Mr. Reback.
During the past 3 years the Office of Inspector General has issued nine audit
reports to officials of the CNMI.
These audits have covered a variety of
financial and program areas and have included audits whose objective was
to report on the Commonwealth's implementation of recommendations made
in audit reports dating back as far as October 1982.
The nine audit reports
contained 63 recommendations for corrective action based on weaknesses or
deficiencies
identified
during
the
audits.
(Fifty-four
of
the
63
201
recommendations
were
addressed
to
the
Commonwealth,
and
9
were
addressed to the Office of Territorial and International
Affairs, now the
Office of Insular Affairs.)
The following
is a summary of the findings in the nine audit reports:
- Management of PubUc Land (March 1996):
We reported that the
Commonwealth had lost $118.4 million on completed exchanges of public
land, could lose $70.1 million on pending exchanges, and lost revenues of
$25.1
million on exchanged public land that was leased to a developer by
landowners.
These problems arose because the Commonwealth did
not
effectively develop and implement management policies, procedures, and
controls related to land exchanges.
Specifically, the Commonwealth did not
exchange public land for private land of comparable value, use current land
valuations in land exchanges, and consider the revenue that could be realized
from the commercial development of exchanged public land.
In addition,
we
reported
that
lease
revenues
of
$565,000
were
lost
and
that
the
Government may lose additional lease revenues of $469.2 million over the
unexpired
period
of the
12
leases we reviewed because of
the
lack of
properly implemented
policies and procedures
to ensure
that appropriate
lease agreements were established and effectively managed.
Specifically,
minimum lease payments were not based on the appraised fair market value
of the property;
gross
receipts
rental payments and
interest on past-due
rentals were not properly assessed; and collection actions were insufficient.
Finally, we found that 208 homestead recipients improperly received a total
of $7 million from the unauthorized sale or lease of their lots and that 12 of
the 23
homestead
lots
reviewed were awarded
to
applicants who were
ineligible
or who
did
not
have
the
greatest
need.
We
made
seven
recommendations for corrective action.
The Commonwealth did not respond
to our November
1995
draft audit
report.
Following
the issuance of our
final
audit report, we received a
response from the Governor of the Conmionwealth which stated that new
land exchange regulations had been issued effective May 25, 1996, and that
the Governor's certification or the Legislature's declaration or determination
of a public purpose would be required as the first step in a land exchange.
Based on our
initial
evaluation of the response, we considered the two
recommendations pertaining to land exchanges unresolved because the new
202
regulations
provided by
the
Governor
are
essentially
a
restatement of
previous land exchange regulations issued in January 1988~regulations that
were ineffective in preventing the conditions described in our audit report.
For
example,
the
regulations
were
not
changed
to
address
our
recommendation that land exchanges should be of comparable value based
on current appraisals.
In
addition,
the Governor's
response
stated
that
it was
not possible
to
develop
and
implement
changes
needed
to
comply
fully
with
our
recommendations pertaining to lease management in a short time, but that
the Division of Public Lands was "seriously considering" issuing regulations
governing the leasing of public lands.
While we agree that the Division of
Public Land's decision to hire two new employees and request an additional
attorney with responsibilities in the area of lease management are positive
steps, the absence of any definitive plans from the Commonwealth regarding
the development of policies and procedures to correct the deficiencies
in
lease management and to guide the actions of Commonwealth employees
compels us to consider our recommendations regarding lease management
unresolved.
The Governor's response also stated that it would be impossible to perform
the recommended
inspections and
reviews
pertaining
to homestead
lots
because of insufficient staff
While we appreciate the challenges that the
problem of insufficient resources always poses, we do not believe that the
Commonwealth's
intent
to
simply
"do what
it
can"
to
accomplish
the
inspections in the face of its expectation that it will not "go very far with
it,
given the current understaffing"
is a satisfactory response.
Accordingly, we
consider
our
recommendations
regarding
homestead
administration
unresolved.
Finally,
the
Governor's
response
indicated
that an Attorney
General's
opinion has been requested on the possibility of seeking recovery of illegal
and/or improper monetary
gains
resulting from
the
sale and/or
lease of
homestead
lots,
in accordance with our recommendation.
However,
the
recommended inspections and reviews would, of course, be necessary in
order to pursue any available recovery.
203
In view of the foregoing, we consider six of the seven recommendations
unresolved (that
is, responsible Commonwealth officials did not adequately
address or agree with the recommendations).
We believe
that, given the
significant problems in the Commonwealth's management of its public lands
and the millions of dollars
at stake, the Commonwealth's response to the
audit report
is inadequate.
- Status of Improvements
in Financial Management and Program
Operations (November 1995):
This report summarized major long-standing
problems in financial management and program operations as identified in
significant audit reports issued by our office, by the Commonwealth Public
Auditor, and by independent public auditors from October 1982 through
August 1995. We concluded that, although the Commonwealth had made
improvements
in
financial
management,
expenditure
control,
revenue
collection,
and program
operations,
further improvements were
needed.
Although we did not make any new recommendations, we identified goals
for improvement. We also reported that the Commonwealth could achieve
improvements by working with the Department of the Interior's Office of
Insular Affairs to identify
priorities for future technical assistance and by
implementing the recommendations made in previous audit reports.
- Assessment and
Collection of Income Taxes (March
1995):
We
reported that the Commonwealth
lost an estimated $13.8 million and may
lose an additional $17.5 million in tax collections because
it did not conduct
an effective
audit
function of tax
returns,
did not impose applicable tax
penalties, and did not investigate potential criminal violations of its income
tax laws.
Also, voluntary compliance with tax laws may have been hindered
because the Commonwealth did not have an income tax investigative and
prosecution function, an effective collection process, and adequate security
over taxpayer records.
Of the report's 17 recommendations for corrective
action,
all were considered resolved and reported as implemented.
- Income Tax Revenues
(November
1994):
We
reported
that
the
Commonwealth's
income
tax
system
did
not produce
the
tax
revenues
needed to fund governmental operations and to match Federal funds for a
1994 Federal
capital improvement grant.
Taxes estimated at $23 million
would not be realized because of the Commonwealth's failure to revise
its
tax laws by the end of 1993.
We also found
that low income taxpayers
204
were subject to excess taxation.
Of the report's two recommendations for
corrective
action,
both
were
considered
resolved
and
reported
as
implemented.
- Contracting and Contract Administration, Commonwealth Utilities
Corporation (November 1994): We reported that the Utilities Corporation
was not compensated by a contractor for revenues lost when the Corporation
agreed
to
offset a contractor's unsubstantiated claim for $3.6 million
in
compensation
against
the
Corporation's own
claim
for
$3.7
million
in
liquidated damages.
The Corporation's claim against the contractor was
based
on
lost
revenues
that
it
attributed
to
equipment
downtime
and
additional
operating
costs.
In
addition,
the
Utilities
Corporation
had
incurred
$343,000
in
additional
contract
costs
for
foreign
currency
exchanges and was expected to incur between $1.3 million and $4.8 million
more because of incorrect conversions from U.S.
dollars to Japanese yen
when
making
contract
payments.
Further,
the
Utilities
Corporation
obligated $13.9 million in excess of funds available, purchased goods and
services totaling $16.6 million without competition, and incurred costs of at
least
$863,000
for
consulting
services
that
were
not
necessary
and
construction
projects
that
were
not
completed.
Of
the
report's
11
recommendations, 6 were considered resolved and reported as implemented,
and 5 were considered resolved but not yet implemented.
-
Utilities
Rate
Structm-e,
Commonwealth
Utilities
Corporation
(September 1994): We reported that the Utilities Corporation defaulted on
obligations totaling over $92.8 million and thereby incurred additional loan
interest charges of more than $16.4
million.
This occurred because the
Corporation did not establish a rate structure that would produce sufficient
revenues
to provide
for
its
(1) operating
costs and
(2) debt service and
contractual obligations
for capital improvement projects and purchases of
equipment.
Of the
report's four recommendations, one was considered
resolved and reported as implemented, and three were considered resolved
but not yet implemented.
- Followup
of Recommendations Concerning
Capital Development
Funds (July 1994): We reported that the Commonwealth and the Office of
Insular
Affairs
did
not
implement
fully
or
effectively
9
of
the
12
recommendations made in our February 1992 audit report.
(Seven of the 12
205
recommendations
were
addressed
to
the
Commonwealth,
and
5
were
addressed to Insular Affairs.)
These recommendations were designed to
ensure
that:
(1)
the
Commonwealth
established
an
effective
financial
management
system
to
account
for and
control
funds
provided by
the
Department of the Interior for capital improvement projects and (2) Insular
Affairs provided effective oversight of projects financed with Federal funds.
As
a
result
of
the
Commonwealth's
failure
to
implement
the
recommendations,
funds
of
over
$2.2
million
targeted
for
capital
development were not used
for allowable purposes and loan agreements
were not executed to ensure that the funds were used for revenue-producing
projects.
(The
$2.2
million was
in
addition
to
$11
million
that we
questioned in the 1992 report.) We made
11 new recommendations during
the followup audit (3 to the Commonwealth and 8 to Insular Affairs),
all of
which were considered resolved and reported as implemented.
-
Followup
of
Recommendations
Concerning
the
Economic
Development Loan Fund, Commonwealth Development Authority (July
1994):
We reported that the Commonwealth did not implement
fiilly or
effectively any of the 20 recommendations made
in our September 1990
audit
report.
These recommendations were designed
to ensure
that
the
Commonwealth complied with Federal laws regarding use of the Loan Fund
and took legal action against officials who failed to carry out their fiduciary
responsibilities.
As a result of the Commonwealth's failure to implement
the
recommendations,
the
principal
in
the Loan Fund
decreased by
$3
million.
Further,
the
Development
Authority
had
not
accrued
and/or
collected
interest charges of over $2.8 million on Loan Fund
assets
that
were used improperly.
(These amounts were in addition to $11.6 million
that we questioned in the 1990 report.) We made six new recommendations
during the followup
audit, of which three were considered resolved and
reported as implemented and three were considered unresolved.
-
Followup
of
Recommendations
Concerning
the
Economic
Development Loan Fund, Mariana
Islands Housing Authority
(July
1994):
We reported that the Commonwealth did not implement fully or
effectively the three recommendations addressed to the Commonwealth in
our February 1991 audit report and that Insular Affairs had implemented the
one
recommendation made
to
that
office
in
the
same
report.
These
recommendations
were
designed
to
ensure
that
the
Commonwealth
206
reorganized the Housing Authority so that
it could be operated efficiently
and effectively for the purpose of providing low income housing and that
Insular Affairs performed periodic on-site program reviews.
As a result of
the
Commonwealth's
failure
to
implement
the
recommendations,
the
principal in the Direct Family Home Loan Program decreased by $980,000,
mainly because
the Housing
Authority continued
to use Program
assets
improperly.
Further,
the
Housing
Authority had
not
accrued
interest
charges of about $500,000 on Program assets that were used improperly.
(These amounts were in addition to the $2.5 million that we questioned in
the
1991
audit report.)
We made
five new recommendations during the
followup audit (four to the Commonwealth and one to Insular Affairs),
all
of which were considered resolved and reported as implemented.
As the foregoing demonstrates, these nine audit reports covered a vast array
of
issues
pertaining
to
the
Commonwealth's
efforts
to
develop
and
effectively
implement
policies,
procedures,
and
controls
related
to
the
purchase,
use,
and
disposal
of public
land;
financial
management and
program operations; the assessment and collection of income taxes and the
establishment of a taxation system capable of producing sufficient revenues;
the acquisition of plant, equipment, goods, and sen/ices related to its power,
sewer, and water facilities; the establishment of a utilities rate structure that
would
produce
sufficient
revenues
to
provide
for
debt
service,
capital
improvement projects, and new equipment costs; and oversight and control
over expenditures of capital and economic development funds.
The results
of
these
audits
have
clearly
shown
that
the Commonwealth
has
paid
insufficient
attention
to
matters
relating
to
opportunities
for
increasing
revenues and collections and for reducing expenditures and operating costs.
As
described
earlier,
these
deficiencies
have
cost
the
Commonwealth
millions of dollars in foregone or uncollected revenues and in unnecessary
or inappropriate expenditures.
The
most
current information
available
to
us from
officials
within
the
Commonwealth
and
Insular
Affairs
regarding
implementation
of
audit
recommendations made during the past 3 years indicates the following:
45
of the 63 recommendations have been resolved and reported as implemented;
9 of the 63 recommendations have been resolved but are not implemented;
and
9
of
the
63
recommendations
are
unresolved.
Several
of
these
207
unresolved and unimplemented recommendations were made in audits dating
back to July 1994.
Thus, to date, responsible officials within the Commonwealth have reported
that they have implemented 36 of the 54
audit recommendations made
during the past 3 years and that 9 of the remaining
18 recommendations
have
been
resolved.
However,
as
our
foUowup
audits
on
earlier
recommendations
concerning
the
Capital
Development
Funds
and
the
Economic Development Loan Fund showed,
recommendations,
although
resolved, are not always implemented.
Further, recommendations reported
as
implemented
are
not
always
implemented
fully
or
effectively.
Specifically, only 4 of 25 resolved recommendations from earlier audits of
those programs had been implemented fully or effectively at the time of the
followup audits, notwithstanding the passage of several years.'
Based on
the followup
audits, we made 22 new recommendations
to correct long-
standing weaknesses and deficiencies
in those programs.
Of the 22 new
recommendations,
13 were directed
to
the Commonwealth,
and 9 were
directed
to
the
Office
of
Insular
Affairs.
Nineteen
of these
22 new
recommendations have now been reported as implemented.
The long-range strategy developed by our office for the Commonwealth Iras
focused,
and
will
continue
to
focus,
on
revenues
and
expenditures
of
government operations.
This
is because our audits have repeatedly raised
questions about the Commonwealth's ability and determination to:
(1) raise
sufficient revenues locally to fund governmental operations and a portion of
its infrastructure needs and (2) carry out
its operations
in an efficient and
cost-effective manner.
We
are
encouraged
by
this
Subcommittee's
interest
in
the
Office
of
Inspector General's audit activities within the Commonwealth. We believe
that oversight hearings such as this,
if held periodically, could serve as the
necessary catalyst to encourage government officials in the insular areas to
(
'
Thirty-six recommendations were made in the earlier audits, 32 of which were not
implemented
fully
or
effectively
at
the
time
of
the
followup
audits.
Of
the
36
recommendations,
the Commonwealth had agreed with 20 of the 30 recommendations
made to
it and the Office of Insular Affairs had agreed with 5 of the 6 recommendations
made to that office.
208
resolve and implement Inspector General
audit recommendations.
Such
hearings would serve a particularly useful purpose because the Department
of the Interior does not have the same level of authority or influence in the
insular areas as
it does in
its own offices and bureaus to ensure that audit
recommendations
are
resolved
properly
and
implemented
fully
and
effectively.
In
the
absence of appropriate
oversight of
resolution and
implementation
activities,
the
benefits
that
can
be
achieved
from
the
implementation of audit recommendations may not be fully realized.
This concludes my prepared statement.
I would be happy to respond to any
questions that the Subcommittee may have concerning my testimony.
209
Prepared statement of Juan N. Babauta
Resident Representative Juan N. Babauta
Subcommittee on Native American and
Insular Affairs
June 26, 1996
Mr. Chairman:
Thank you for the opportunity to testify.
My position on reform in the Northern Marianas is on record with this
Subcommittee.
I testified here in January 1995 on proposals you made in
H.R. 602, regarding minimum wage and immigration.
I
will, however,
summarize my position here this afternoon and in that context comment on
the two proposals in this year's report by the Interior Department on the
joint CNMI-Federal law enforcement initiative.
I will also use some of my time — as
I do each time
I testify before
Congress — to repeat my
call for the reform
I consider most necessary,
least controversial, and most easily accomplished: giving the people of the
Northern Marianas representation here in Congress.
Core Problem: Unrestricted Immigration
Seventeen months ago
I testified before you on H.R. 602.
Two general
principles should apply in determining congressional policy towards the
Northern Marianas,
I said:
first, any policy should fulfill the fundamental
federal responsibility to protect human and
civil rights throughout our
nation; and second, any policy should favor reduced federal involvement at
the local level and promote instead increased local responsibility.
Applying those two principles,
I testified in favor of the Chairman's
proposals to institute federal wage review boards in the Northern Marianas
and to put a cap on immigration.
I
opposed, however,
direct
federal management
of our borders.
I
opposed federal management because the joint initiative had beg\in.
Its
purpose was
to
restore professionalism and
reinstill confidence
in the
Northern Marianas'
ability
to manage immigration
locally.
I
said the
initiative should be given a chance to prove its worth.
Seventeen months later, I am not encouraged.
To me the core problem for CNMI immigration is not the mechanics of
administration.
Rather the problem is the sheer, overwhelming number of
immigrants.
Immigration has no limit; it is wide open, unrestricted.
This
is not what was intended when Congress approved the Covenant
and provided
for
local control of immigration.
As the Senate
Interior
Committee wrote at that time: "...this provision is included to cope with the
problems which unrestricted immigration may impose upon small island
communities.
Congress is aware of these problems."
Local control of immigration was conceived as a tool for protecting the
indigenous people. If we choose to use it as such,
I believe we should retain
that control.
If we decide we do not care
to preserve our status in our
islands, then the arg\iment for local control ceases.
And we have not acted to preserve our status.
210
Resident Representative Juan N. Babauta
Subcommittee on Native American and
Insular AfTairs
June 26. 1996
The CNMI recently released
its preliminary report of the 1995 mid-
decade census.
Immigration remains unchecked.
Indigenous people are
outnumbered 2 to
1.
And a government economist predicts another 32,000
residents will be added by the turn of the century, leaving the indigenous
outnumbered by over 4 to
1.
Thousands of these new residents will be the children of alien workers,
but they will also be US citizens by virtue of their birth in the Northern
Marianas.
These children of "temporary" workers are being bom in our
hospital at a rate double or triple the rate of babies bom to indigenous
parents, and within a generation have the potential to become a controlling
political force in the Northern Marianas.
The indigenous people of the Northern Marianas have put themselves at
risk of losing control of their own home by allowing themselves to become a
minority.
We have done
so out
of what
I
consider a misguided notion that
economic development in the Northern Marianas can only be accompUshed
along with unlimited population growth.
It is a notion promoted by those
who benefit firom having the largest possible labor pool at the lowest possible
wage.
It
is a notion
I do not accept; and
it
is a notion
I believe a cap on
immigration would dispel.
Indeed, look at the garment industry. An existing cap on the number of
garment workers ^ did not prevent that industry from adding $100 million in
sales from FY94 to FY95 — 30% annual growth.
Placing a cap on new immigration will not bring economic ruin to the
CNMI.
It will help stop the erosion of the control indigenous people have
over their own home; and a cap
will provide breathing room
for us
to
consider what kind of a future we want for our islands.
Recommendation #2: Prison Facilities
This year's report on the joint law enforcement initiative makes two
recommendations.
The second — investment in prison
facilities —
is
required
largely because
of unchecked immigration, which
results
in
overburdening of all public faciUties: schools, roads, health care, and public
safety.
Increased drug
trafficking, government
corruption, and
crimes
of
violence are closely linked in the Northern Marianas to immigrants and
immigration.
But building better prisons, necessary though
it may be,
treats the symptom and not the disease.
And it seems a strange distortion that funds designated by the Covenant
to help raise the standard of living of the people of the Northern Marianas
are now recommended to be used instead to raise the standard of Uving of
criminals.
In fact. Covenant funds should not be the sole source for prison facilities
in
the
Northern
Marianas.
Because
one-third
of the inmates^
are
211
Resident Representative Juan N. Babauta
Subcommittee on Native American and
Insular Affairs
June 26, 1996
immigrants from the Freely Associated States—over whom the Northern
Marianas immigration laws have
no
control.
These immigrants
are
permitted to enter by virtue of the Federal compacts with the Micronesian
nations. In approving the Compacts the Congress also agreed to offset the
fiscal costs to the Northern Marianas and other US Pacific islands.
And
Congress ordered an annual report on these costs.
Unfortiinately, in ten
years the Interior Department has never deUvered any report.
By acknowledging the need
for an $11 million investment in prison
facilities, however, Interior has indirectly reported to Congress on one cost
of the Compacts of Free Association.
It seems clear, therefore, that fiscal
responsibility for construction of prison faciUties and for operational costs
attributable to inmates from the freely associated states should be bom by
the Federal government.^
Recommendation #1: Federal Minimum Wage
Interior's first recommendation is for federalization of minimum wage
with a thirty cent annual increase until the CNMI reaches the Federal
minimum.
I have previously called
thiL. proposal "a blunt economic instrument"
and it should not be confiised with CNMI Public Law 8-21, which also set up
a mandatory thirty cent ainnual increase.
That law contained an important
feedback mechanism: a wage review board to advise the CNMI Legislature
on the effects of each year's increase.
Unfortunately, the well balanced local law has fallen by the wayside.
In
1994 the Governor did away with the board. When it was reinstated in 1995
by the Legislature, he appointed as board chairman a highly placed official
in the garment industry. Not surprisingly, this reconstituted board
first
recommended delaying any increase
in the minimum wage and then
recommended doing away altogether with the step-wise approach to raising
the minimum wage—all on the thinnest of economic analysis.
Last week,
the
Governor
is
reported
to
have
signed
into
law
this
second
recommendation.
The Interior Department report calls this chain of events "vacillation."
I
would not be so kind. And let me add that these events have occurred for
one primary reason: the undue influence of the garment industry in the
government of the Northern Marianas.
For at the same time the local
minimum wage law was being systematically taken apart, the Chamber of
Commerce, the local hotel association, the contractors
association, and
others in the community were expressing their support for increasing the
minimum wage.
In light of these
facts,
I continue
to support the proposal
to use the
federal wage board system
to
determine
the minimum wage
in
the
Northern Marianas.
Taike the decision out of the poUtical arena and base it
on economics.
212
Resident Representative Juan N. Babauta
Subcommittee on Native American and
Insular Affairs
June 26, 1996
The Simplest Reform: Repi«sentation in Congress
I began
this testimony on Northern Marianas legislative reforms by
expressing the general principles that Congress should protect civil rights
throughout our nation and shoxild promote local responsibihty.
In keeping with these two principles
I believe this subcommittee must
take up the question of representation in Congress for the people of the
Northern Marianas.
There may be no explicit "civil right" to such representation, but two
hundred years of practice have established an irrefutable precedent for
people living in non-State areas to have a voice in their nation's law-making
body.
And
if
Congress
wishes
to
promote
a
greater
degree
of
"responsibility" in the Northern Mariainas,
I would maintain there
is no
better way than to end our political exclusion from the American family.
The case of the people of the Northern Marianas
is simple: We are
citizens of the United States.
We live within the borders of the United
States. We are governed by the laws of the United States enacted by this
Congress.
Yet we lack what would seem the most basic right of our
citizenship: a voice in our nation's government.
And so we ask to be represented here. We ask to have our own delegate
here in the House of Representatives.
We ask for no special treatment.
For Congress has since 1790 admitted
delegates to the House to represent the residents of non-State areas of our
nation.
Chairman Young, Mr. Hastings and Mr. Metcalf, Mr. Kildee, Mr.
Williams and Mr. Johnson of this Subcommittee
all hail from geographic
areas once represented in Congress by delegates.
And Mr. Faleomavaega,
Mr. Romero-Barcel6, aind Mr. Underwood are present day representatives
of non-State areas — three of the five such in the 104th Congress.
What we
ask,
therefore,
is
only what Congress
has
regarded
as
necessary and proper for 200 years, even up to this very moment.
I am not the first nor the only person from the Northern Marianas to
request
representation
in
Congress.
The Marianas
Political
Status
Commission that negotiated the Covenant of political union between the
Northern Marianas and the United States made this same request.
I quote
fi-om the svmimary report of their third round of negotiations in 1973:
The Marianas' representatives have requested that the new
Commonwealth government be entitled to have a non-voting
delegate in the United States Congress, similar
to the non-
voting delegates
in Congress representing Guam and the
Virgin
Islands."*
The Conunission's request was supported in principle by the Special
Representative
of Presidents Nixon and
Ford, Ambassador
F. Haydn
Williams.
In
1985,
representation
for
the
Northern
Marianas
was
again
recommended, this time by the Commission on Federal Laws called for in
Section 504 of the Covenant.
The Commissioners, appointed by President
213
Resident Representative Juan N. Babauta
Subcommittee on Native American and
Insular Affairs
June 26, 1996
Reagan and
including Congressman
Robert
J.
Lagomarsino,
long
a
member of this Committee,
made as their very
first recommendation a
Northern Marianas delegate in the US House of Representatives.
I ask that the Commission's recommendation be made part
of the
record.
More recently the Commonwealth Legislature has repeatedly petitioned
the Congress for a delegate to the House.
Though political control has
changed back and forth in the last three Legislatures, by joint resolution
they each have asked to have what all other constituent parts of the US
have: representation in Congress.
I ask that the most recent of those joint resolutions be added to the
record.
The only explicit objection to Northern Marianas representation is found
in
the
analysis
of the
Covenant by
the
Marianas
Political
Status
Commission.
During the negotiations the MPSC, with the support of the
Executive Branch of the U.S. Government, was not able
to
obtain a firm conmiitment for such a non-voting delegate.
The
principal
reason
given was
the
small
population
in
the
Marianas compared with the population in Guam and the
Virgin Islands at the timie those territories were given non-
voting delegates.
The
Northern
Marianas'
population
of
15,000
at
that
time
was
considerably less than the populations of Guam (86,926) and the Virgin
Islands (63,200) had been when those territories were granted nonvoting
delegates in 1972.
Two years
after approving the Covenant without a provision
for a
Northern Marianas delegate, however. Congress reduced the population
standard by granting a
delegate
to American Samoa with
a
resident
population of 27,000, most of whom were not US citizens.
Today, with a US citizen population of 27,512 and a total population of
59,913 the Northern Marianas is clearly within the threshold of population
established by precedents both historical and contemporary.
Mr. Chairman, in opening your hearing on H.R. 602 you said that "the
territories... are due the same treatment as other political divisions of the
United States." That is a sound goal. But the Northern Marianas does not
even ask that.
All we ask is for the same treatment as the US territories:
the opportunity to be represented in Congress.
Give the people of the Northern Marianas what
all other US citizens
living within this nation's borders have: a voice in Congress.
Thank you.
^ An administrative moratorium on the number of workers in the garment industry was
lifted in 1996 by the Governor. A legislative attempt to reimpose that moratorium was
vetoed, the veto then overridden.
2 March 1993 data.
214
Resident Representative Juan N. Babauta
Subcommittee on Native American and
Insular AfTairs
June 26, 1996
^ These costs should also be a federal responsibility with respect to any inmates detained
under the exercise of Federal law.
* Summary Report of the Marianas Political Statues Commission on the Third Session of
Status Negotiations, December 19, 1973.
215
Welcoming
america's
Newest
Commonwealth
The Second Interim Report of the
Northern Mariana Islands Commission
on Federal Laws to the
Congress of the United States
August 1985
216
Northern Mariana Islands Commission on Federal Laws
Washington, D.C. 20240
(202) 343-561
Banlgno R. Filial
Ctmr and
Commissioner
Padre A. Tanorlo
VIce-CtiaJr and
Commssioner
Joal J. Bargsnw
CorruTussioner
jMua C. Borja
Commissioner
Danny U Ftlcon*
Commissioner
Hon. Roban J. Ligomanlno
Commissioner
Edward OLS. Pangallnan
Commissioner
Oanlal H. MacMMkln
Bxecutive Oiracuir
The Honorable Thonas
P. O'Neill,
Jr.
Speaker of
the House of Representatives
Peon H-204
The Capitol
Washington,
D.C.
20515
Dear Mr.
Speaker:
I
have
the honor
of
sutmitting
to
you
the
second
interim
report
of
the
Northern
Mariana
Islands
Conmission
on
Federal
Lav(s.
The
Conmission,
appointed
by
the
President pursuant
to
section
504
of
the
Covenant
to
Establish
a
Connonwealth
of
the
Northern
Mariana
Islands
in
Political
Union
with
the
United
States
of
America
(approved
by
Public
Law
94-241,
90
Stat.
263,
March
24,
1976),
is
instructed
"to survey
the
laws
of
the
United
States
and
to
make
recanmendations
to
the
United
States Congress
as
to
which
laws
of
the United
States
not
applicable
to
the Northern Mariana
Islands
should
be made
applicable
and
to
what
extent
and
in
what
manner,
and
which
applicable
laws
should
be
made
inapplicable
and
to
what
extent and
in what manner.
The
Conmission
is
required
to make
its
final
report
and
recanmendations
to
Congress
within one
year
after
termination
of
the
Trusteeship
A^eonent
pursuant
to
which
the
United
States
now
administers
the
Northern
Mariana
Islands.
Before
that
time,
the Conmission
is
authorized
to
"make
such
interim
reports
and
recanmendations
to
the
Congress
as
it
considers
appropriate
to
facilitate
the
transition
of
the
Northern
Mariana Islands
to its new political status."
The
enclosed
second
interim
report
of
the Conmission
is
conprehensivB
and
for
all
practical purposes may be
the
final
report
of
the Conmission.
The date
the Trusteeship A^eanent
will
be
terminated
is
not
now
known,
however,
and
developments
between
now
and
that
date
may
make
desirable
subnission
of
further
recanmendations
to
Congress
by
the
Conmission.
Accordingly,
even
though
the
Conmission' s
staff
will
be
disbanded
after submission
of
this
report,
the
report
is labelled as interim rather than final.
Legislation
to
implanent
the
Conmission'
recanmendations
is
incorporated
within
the
report.
The
Conmission
urges
the
Congress
to
enact
this
legislation
at
its earliest opportunity.
Sincerely,
'
Benigno R.
Fitial
217
-
53 -
RECOWENDED CHANGES
IN FEDERAL LAW
A nonvoting delegate to the United States Congress .
Reccnr^ndat ion .
Legislation
should
be
enacted
to
provide
the
Nksrthem
Mariana
Islands
representation
in
the
LYiited
States
Congress
by
conferring
the
status
of
nonvoting
Delegate
to
the
United
States
House
of
Representatives
on
the
Resident
Representative
to
the
United
States
for the Northern Mariana Islands.
The statutes .
All
legislative
powers
granted
the
Federal
Goverment
by
the
united
States
Constitution
are
vested
in
the
Congress
of
the
L'nited
States,
-which
consists
of
the
Senate
and
the
House
of
Representatives.
U.S.
Const.,
Art.
I,
§
1.
The
mentbers
of
the
Senate
and
of
the
House
of
Representatives
are
elected
by
the
citizens
of
the States
of
the united
States.
_Id.
§
2,
cl.
1; Amend.
XVII, arendina Art.
I,
§
3, cl.l.
Present applicability .
The
United
States
Constitution
contains
no
provision
for
representation
in
Congress
of
citizens
residing
in
areas
within
the
jurisdiction
of
the
United
States
but
not
oart
of
any
State.
Even
prior
to
adoption
of
the
Constitution,
however,
section
12
of
the
Ordinance
of
1787—v^ich
established
the
pattern
for
subsequent
congressional
legislation
on
territorial
govemitent—authorized
a
delegate
to
Congress
fran
the
Northwest
Territories.
1
Stat.
52.
The
delegate
selected
was
afforded
"a
seat
in Congress
with
a
right
of
debating,
but
not
of
voting."
Id.
Provision
for
a
nonvoting
delegate
to Congress
to
represent
areas
within
the united States
that
are
not
part
of
the
United
States
has
been cannon practice since
that
tiine.
See
generally
E.
Brcwn,
The
Territorial
Delegate
to
Congress
and Other
Essays
3-38
(1950);
chaoter
7,
"The
Delegate
in Territorial
Relations,"
in
E.
Ponerx^y,
The
Territories
and
the
United
States,
1861-1890
(rev.
ed.
1969);
and
cnapter
7,
section
T,
"Status
of
Delegates
and
Resident
Ccmmissioner,"
in
2
L.
Deschler,
Deschler's
Precedents
of
the
United
States
House
of
Representatives
(1977)
(House DDCurent 94-661).
At
the
present
time,
the
District
of
Columbia,
Guam,
the Virgin
Islands,
and
American
Samoa
are
represented
by
nonvoting
"Delegates"
218
-
54 -
to
the
United
States
House
of
Representatives
while
Puerto
Rico
is
represented by a nonvoting
"Resident Ccmmissioner."*
Delegates
to
the
House
of
Representatives
(includirq
the
Resident
Corunissioner
from
Puerto
Rico)
provide
their
constituencies
with
a
voice
in
the
legislative
process.
Although
they
cannot
vote
on
the
floor
of
the
House,
they
serve on
caranittees
and,
unless
the
Rules
of
the
House
of
Representatives
provide
otherwise,
are
permitted
to
vote
in
canmittee.
They receive
the
same
ccmpensation,
allowances,
and
benefits
as
do
Manbers
of
the
House
of
Representat ives.
The
Northern Mariana
Islands
is
not
represented
in
the Congress
of the United States.
Section
901
of
the
Covenant
authorizes,
and
Article
V
of
the
Constitution
of
the
Northern
Mariana
Islands
provides
for,
election
by
the
people
of
the
Northern
Mariana
Islands
of
a
Resident
Representative
to
the
United
States.
See
also
1 Code
of the Northern
Mariana
Islands
S§
4101
et
sea.
(1984),
as
amended
by
Northern
Mariana
Islands
Public
Law
3-92
(1984).
This
representative,
however,
does
not
have
the
status
of
a
nonvoting
delegate
to
the
United States Congress.
Discussion .
"No
right
is more
precious
in
a
free country than
that of having
a
voice
in
the
election
of
those
who
make
the
laws
under
which,
as
good
citizens,
we
must
live."
Wesberrv
v.
Sanders ,
376
U.S.
1,
17
(1964).
See
also Reynolds
v.
Sims ,
377
U.S.
533,
555,
564-65
(1964);
Gray
v.
Sanders ,
372
U.S.
368,
381
(1963).
The
Congress
of
the
United
States
has
plenary
power
to
make
the
laws
under
which
the
people
of
the
^3orthern Mariana
Islands,
as
good
citizens,
must
live.
U.S.
Const.,
Art.
IV,
§
3,
cl.
2;
Trusteeship
Agreoient,
Art.
3.
Nothing
in
the
United
States
Constitution
or
in
the
Covenant,
however,
requires
that
the
people
of
the Northern
Mariana
Islands
be
granted
a
voice
in
the
United
States Congress,
to
speak
on
the
laws
under
which
the
people
of
the
Northern
Mariana
Islands
must
live.
Indeed,
the
population
of
the
Northern Mariana
Islands
is
such
that
were
it
able
to
elect
a
full-fledged
Member
in
the
House
of
Representatives,
the
Northern
Mariana
Islands
would
be
disproportionately over-represented
in the House.
Public
Law
91-405,
§
201,
84
Stat.
845
(1970),
D.C.
Code
§
1-401
(1981)
(District
of
Columbia);
48
U.S.C.
§§
1711-1715
(Guam
and
the
Virgin
Islands);
id.
§§
1731-1735
(Anerican
Samoa);
^d.
§S 891-894
(Puerto Rico).
219
-
55
-
Prevision
of
a delegate
to
the House
of
Representatives,
coupled
with
the
large measure
of
local
self-governnient
granted
by Article
I
of
the
Covenant,
constitutes
a
reasonable
cancranise
between
the
requireinents
of
representative
derocracy
and
the
realities
of
small
population and distant location.
Much
that
was
said
in
support
of
creation
of
the
office
of
Delegate
to
the
United
States
House
of
Representatives
fran Merican
Samoa
applies
>ri.th
equal
strength
in
favor
of
establishing
an
office
of
nonvoting delegate fron the ^3orther^ Mariana Islands:
The
justification
for
direct
territorial
representation
for
American
Sanioa
in
Congress
gees
back
to
1790,
wherein
the
Congress
provided
for
a
nonvoting
delegate
fran
"the
territory
south
of
the
River
Ohio,"
which
later
became
the
State
of
Tennessee.
Since
that
time,
sane
30
other
U.S.
territories
have
been
represented
by
nonvoting
delegates
to
the
Congress
before
they
became
States
of
the
Union.
Populations
of
the
different
territories
have
varied
fran
as
many
as
5,000
to
259,000
when they were represented by nonvoting delegates.
The
rapidly
changing
econanic
and
social
conditions
in
bcth
the
continental
United
States
and
throughout
the
Pacific
area
provide
a
canpelling
reason
for
direct
representation
of
the
Territory
of
Anerican
Samoa
in
the
House
of
Representatives.
Presently,
the
offshore
areas
are
net
affected
by
general
legislation
unless
they
are
specifically
mentioned
in
the
legislation
or
the
legislation
is
made
applicable
to
the
territories
and
possessions
of
the
United
States.
In
many
instances,
the
legislative
objectives
of
the
offshore
areas
range,
inter
alia,
fran
education
and
welfare
assistance
to
medical
and
health
insiBrance,
housirg,
agricultural
assistance,
unemployment
canpensation,
prevailing
wage
rates,
small
businesses,
labor
unions
and
management,
immigration,
airport
construction
assistance,
foreign
trade,
conmercial
fishing,
highway
and
harbor
construction
assistance,
air
routes,
water
and
electricity,
oil
and
watch
quotas,
veterans benefits,
and many others.
Under
provisions
of
[this
legislation],
a
nonvoting
delegate
fran
American
Samoa
can
more
effectively
represent
and
interpret
the
needs,
welfare
and
interests
of
the
territory.
Furthennore,
the
nonvoting
delegate
will
carry
the
responsibility
of
maintaining
the
contacts
and
liaison
with
the
various
canmittees
of
the
Congress
and
the
officials
of
the
executive
branch
of
the
Federal
Goverrment.
Additionally,
the
nonvoting
delegate
will
relieve
other
Members
of
Congress
of
the
necessity
of
220
56 -
dealing
with
individual
problems
and
related
subject
areas
that
directly
affect
the
interests
of
the
Territory
of
American Sanoa.
(This
legislation]
is
in
keeping
with
the
best
of
Anerican
traditions
to
encourage
areater
particioation
by
the
local
residents
in
the
affairs
of
their
government.
Over
the
years,
Congress
has
continually
provided
greater
self-gcverrment
and
responsibility
for
its
territories.
The
enactment
of
[this
legislation]
would
especially
lessen
any
lingering
impressions
of
American
colonialism,
as
it
is
thought of
in seme quarters of
the world.
House Report 95-1458,
at
3-4
(1978).
Congress
should
new
enact
legislation
to
provide
for
nonvoting
representation
of
the
^torthem
Mariana
Islands
in
the
United
States
House
of
Representatives.
Every
area
within
the
American
politicad
system
that
has
a pemanent
population
is
represented
in
the Congress
of
the
United
States.
The
people
of
the
Northern
Mariana
Islands
have
new
done
all
that
is
required
of
them
to
become
part
of
that
political
systan
and
Conaress,
in
approving
the
Covenant,
has
given
its assent.
To
be
sure,
the
^kDrthem
Mariana
Islands
has
a
snaller
population
than
any
of
the
jurisdictions
now
represented
in Concress.
Its
pooulation
of
17,000
persons,
however,
is
not
of
an
order
of
magnitude
different
fron American
Samoa's
population
of
approximately
31,000.
As
noted
in
the
excecpt
quoted
from
the House Report,
above,
nonvoting delegates have represented as
few as 5,000 persons.
The
proposed
legislation
would
confer
the
status
of
nonvoting
delegate
on
the
Resident
Representative
to
the
United
States
for
the
Northern
Mariana
Islands.
This
position
was
authorized
by
section
901
of
the
Covenant
and
has
been
established
by
Article V
of
the
Constitution
of
the
Northern
Mariana
Islands.*
See
also
1
Code
of
the
Northern
Mariana
Islands
§§
4101
et
sea .
(1984),
as
amended
by
Northern
Mariana
Islands
Public
Law
3-92
(1984).
The
negotiators
of
the
Covenant
drafted
section
901
with
a
view
toward
the' possibility
that
Congress
might
confer
nonvoting
delegate
status
on
the
Resident
Representative .
Report
of
the
Joint
Drafting
Comiittee
on
the
Negotiating
History
of
the
Covenant ,
at
C^^4
(1975),
reorinted
iin
Hearings
before
the
Subcomuttee
on
Territorial
and
Insular
Affairs
of
the
House
Ccnniittee
on
Interior
and
Insular
Affairs
on
H.J.
Res.
549
et
all
to
Aoorove
the
"Covenant
to
Establish
a
Catmonwealth
of
*The
Ctonstitution
of
the
Northern
Mariana
Islands
was
deaned
approved
by
Presidential
Proclamation
4534
in
1977.
42
Fed.
Rea.
56593.
22X
-
SI -
the
^^orthe^n Mariana
Islands ,"
94th Cong.,
Ist
Sess.
374,
406
(1975).
See
also
Senate
Report
94-433,
The
Covenant
to
Establish
a
Comionwealth
of
the
^3orthem
Mariana
Islands
65,
90
(1975).
Section
901
provides
that
the
Resident
Pecresentative
"must
be
a
citizen
and
resident
of
the
^3orthem Mariana
Islands,
at
least
twenty-five
years
of
age,
and,
after
termination
of
the
Trusteeship
Agreeixent,
a
citizen
of
the
United
States."
Article V of
the Constitution
of
the
Northern
Mariana
Islands
adds
that
the
Resident
Representative
shall
have
been
a
resident
and
domiciliary
of
the
Ntorthem Mariana
Islands
for
at
least
seven
years
immediately
oreceding
the
date
of
taking
office
and
provides
for
popular
election
of
the
Resident
Representative
to a two-year term.
Ihe
Deleaates
fran
Guam,
the
Virnin
Islands,
and
;:^inerican Samoa
likewise
must
be
at
least
twenty-five
years
of
aqe
on
the
date
of
their
election
and
must
be
inhabitants
of
the
territories
fran
which
they
are
elected.
48
U.S.C.
§§
1713,
1733.
The
Delecates
fran Guam
and
the
Virgin
Islands
at
election
must
have
been
citizens
of
the
United
States
for at
least seven years.
Id.
§
1713(b).
The Delegate
fran
American
Samoa,
where
nest
residents
are
nationals
rather
than
citizens
of
the
United
States,
is
required
to
owe
allegiance
to
the
United
States.*
Id.
§
1733(b).
The
Delegates
from
Guam,
the Virgin
Islands,
and
American
Samoa
are
popularly elected
and,
at
the
time
of
election,
may
net
be
a
candidate
for anv other office.
Jd.
§§
1711,
1713(d),
1732(a),
1733(d).
The
CTualif ications
and
election
procedures
for
the
office
of
Resident
Representative
to
the United States
for
the ^torthem Mariana
Islands
are
thus
basically
consistent
with
the
qualifications
and
election
procedures
for
the
territorial
Delegate
offices.
The
legislation
here
prooosed,
which
confers
delegate
status
on
the
Resident
Representative,
establishes
Qualifications
and
election
Drocedures
for
that
office
similar
to
those
for
the
office
of
territorial
Delegate.
Because
there
is
no
inconsistency between
the
reouirements
in
the
proposed
legislation
and
those
in
the
Covenant,
there
is
no
need
to
amend
either
the Covenant or
the Constitution
of
the
Northern
Mariana
Islands.**
The
proposed
legislation
does,
*The
distinction
between
"citizens"
and
"nationals"
of
the
United
States
is
not
well-defined.
Nationals—like
citizens—ewe
allegiance
to
the
United
States
and
are
entitled
to
its
protection,
but
do
not
Qualify
for
sane
rights
and
privileges granted by statute
only
to citizens.
**To
avoid
the
necessity
of
amendment
of
either
of
these
fundamental
documents,
the
proposed
legislation
also
retains
the
title,
"Resident
Representative,"
rather
than
substituting
the
more
car^non
title,
"Delegate."
Puerto
Rico's
"Resident
Caranissioner"
is
a
precedent
for this variation
in nanenclature.
27-245 0-96-8
222
- 58
-
however,
impose
the
additional
requiranent
that
the
Resident
Representative,
on
the
date
of
election,
be
a
candidate
for
no other
office.
Regular
general
elections
in
the
Northern
Mariana
Islands
are
held
on
the
first
Sunday
in
Noventoer
in
odd-nuinbered
years.
Constitution
of
the
Northern
Mariana
Islands,
Art.
VIII,
§
1
and
Schedule
on
Transitional
Matters
§
10;
Presidential
Proclamation
4534,
42
Fed.
Reg.
56593
(1977).
The
Resident
Representative,
under
Northern
Mariana
Islands
law,
is
elected
at
that
time
to
a
two-year
term.
Constitution of
the Northern Mariana
Islands,
Art.
V,
§§1,
2;
Northern
Mariana
Islands
Constitutional
Convention,
Analysis
of
the
Constitution
of
the
Carmonwealth
of
the
Northern
Mariana
Islands
124-25
(1976).*
The
Resident
Representative
takes
office
on
the
second
Monday
in January
of
the
following
year.
Constitution
of
the
Northern Mariana Islands,
Art.
VIII,
S
4.
By
contrast.
Representatives
and
Delegates
to
the
Congress
are
elected
on
the
first
Tuesday
after
the
first
Ntonday
in
November
in
ever>-nurabered
years
and
take
office
on
the
third
day
in
January
of
the
following
year.
2
U.S.C.
§
7.
Representatives
and
the
Etelegates
from
the District of
Columbia,
Guam,
the Virgin
Islands,
and American
Samoa
serve
two-year
terms.
D.C.
Code
§
l-401(a)
(1981)
(District
of
Coluunbia);
48
U.S.C.
§
1712(a)
(Guam
and
the
Virgin
Islands);
id.
S
1732(a)
(American
Samoa).
The
Resident
Caranissioner
from
Puerto
Rico,
however,
serves a four-year term.
Id.
«
891.
The
legislation
here
proposed
allows
the
people
of
the Northern
Mariana
Islands
to
elect
the
Resident
Representative
as
provided
in
their
Constitution,
even
though
the
Resident
Representative
will
be
elected
and
take
office
in
different
years
(and
on
different
days)
than
the
Representatives
and
other
Delegates.
The
uniform
federal
election date was
established
in
1871
to make
voting
in more than one
jurisdiction
difficult
and
to
prevent
news
of
results
in
earlier
elections
fran
influencing
the
outcane
in
later
elections.
45 Cong.
Globe
112,
141
(1871).**
These
concerns
are
of
little moment
in
the
case
of
the
Northern
Mariana
Islands
at
the
present
tiroe.
A
few
persons
may
in
fact
be
able
to
vote
for
both
the
Resident
Representative
for
the
Northern
Mariana
Islands
and
a Representative
*The
Resident
Representative's
tenn may
be
increased
to
no more
than
four
yeaurs
by
popular
initiative.
Constitution
of
the Northern
Mariana Islands,
Art.
V,
S
2.
**Prior
to
1871,
eadi
State
set
its own election date.
_Id.
See
U.S.
Const.,
Art.
1,
§
4,
cl.l.
223
- 59 -
or
Delegate
frcm
another
jurisdiction.
But
voter
registration
requirements,
the
Resident
Representative's
limited
powers
in
Congress,
and
the
time
and
money
required
to
travel
between
the
Northern
Mariana
Islands
and
other
jurisdictions
make
unlikely
intentional
efforts
to
subvert
the
electoral
process
by
taking
advantage
of
the
discrepane/
in
election
dates.
As
for
preventing
earlier
election
results
from
influencing
the
outcane
in
later
elections,
modern
ccmmunications
have
made
that
goal
elusive
even
when elections are held on the same ddy but
in different time zones.
Requiring
election
of
the
Resident
Representative
on
the
same
day
as
the
election
of
Representatives
and
other
Delegates
to
the
House
of
Representatives
is
a
reasonable
alternative
to
the
jroposal
here
made.
But
to
achieve
this
uniformity
the
Northern
Mariana
Islands
would
either
have
to
amend
its
constitution
to
change
its
regular
general
election
from
the
first
Sunday
in
Novenber
in
odd-numbered
years
to
the
first
Tuesday
after
the
first
Monday
in
November
in
even-numbered
years
or
suffer
the
costs
of
holding
an
extra
election
every
other
year.
(Vhile
a
federal
statute
would
supercede
the
provisions
of
the Constitution
of
the
Northern Mariana
Islands
regarding
election
of
the
Resident
Representative,
it
would
not
affect
the
provisions
as
they
relate
to
election of other
public
officials
in
the
Northern
Mariana
Islands.
The
extra
election
would
still
be
required
unless
the
people
of
the
Northern
Mariana
Islands
amended their constitution.)
Under
the
proposed
legislation,
the
first
Resident
Representative
with
the
status
of
nonvoting
Delegate
to
the
House
of
Representatives
\<;uld
be
elected
at
the
regular
general
election
in
the
first
odd-numbered
year
subsequent
to
enactment
of
the
legislation.
The
effective
date
of
the
proposed
legislation
is
not
postponed
until
after
termination
of
the
trusteeship,
even
though
the
Covenant will
not
be
fully
implemented
until
that
time.
The date
for
termination
of
the
trusteeship
is
not
yet
known,
and may
not
arrive
for
several
years.
In
the
meantime.
Congress
will
make
many
legislative
decisions
affecting
the
Northern
Mariana
Islands,
decisions
in which
the Northern Mariana
Islands
should
have
a
voice.
Indeed
it
is
in
this
period,
vi*ien many members of Congress are
little
acquainted with
the particular
needs
of
the Northern Mariana
Islands,
that
participation
by
the
nonvoting
Resident
Representative
may
be
most
important.
In
enbracing
the
Covenant,
the
people
of
the
Northern Mariana
Islands
have
already made
their
decision
to
be
part
of
the
United
States.
No
purpose
is
served
by
delaying
their
election
of
a
nonvoting
Resident
Representative
to
the
United
States
House
of Representatives
until
seme uncertain date
in
the
future when
the trusteeship
is finally terminated.
224
- 60 -
Proposed legislative language .
The
following
language,
if
enacted
by
the
United
States
Congress,
vould implement
the Ccnroission's reconmendation:
An
Act
to
confer
the
status
of
nonvoting
Delegate
to
the
United
States
House
of
Representatives
on
the
Resident
Representative
to
the
United
States
for
the
Northern Mariana Islands.
Be
it
enacted
bv
the
Senate
and
House
of
Representatives
of
the
United
States
of
America
in Congress
assembled ,
that
the
Northern
Mariana
Islands
shall
be
represented
in
the
United
States
Congress
by
the
Resident
Representative
to
the
United
States
authorized
by
section
901
of
the
Covenant
to
Establish
a
Ccmmonwealth
of
the
Northern Mariana
Islands
in
Political
Union
with
the United
States
of
America
(approved
by
Public
Law
94-241,
90
Stat.
263).
The
Resident
Representative
shall
be
a
nonvoting
Delegate
to
the
House
of
Representatives,
elected
as
hereinafter provided.
Sec.
2.
(a)
The
Resident
Representative
shall
be
elected
by
the
people
qualified
to
vote
for
the
popularly
elected
officials
of
the
Northern
Mariana
Islands
at
the
regxU.ar
general
election,
on
the
day
and
nonth
set
by
section
1
of
Article
VIII
of
the
Constitution
of
the
Northern
Mariana
Islands,
in
the
first
odd-numbered
year
subsequent
to
enactment
of
this
Act
and
thereafter
as
provided
in
the
Constitution
of
the
Northern
Mariana
Islands.
The
Resident
Representative
shall
be
elected
at
large,
by
separate
ballot,
and
by
a
majority
of
the
votes
cast
for
the
office
of
Resident
Representative.
If
no
candidate
receives
such
majority,
on
tJ-ie
fourteenth
day
follcving
such
election
a
runoff
election
shall
be
held
bet\«en
the
candidates
receiving
the
highest
and
the
second
highest
number
of
votes
cast
for
the
office
of
Resident
Representative.
In
case
of
a
permanent
vacancy
in
the
office
of
Resident
Representative
by
reason
of
death,
resignation,
or
permanent
disability,
the
office
of
Resident
Representative
shall
ranain
vacant
until
a
successor shall have been elected and qxjalified.
(b)
The
term
of
the
Resident
Representative
shall
ccmmence
on
the
second Monday
of
January
following
the
date
of
the election.
Sec.
3.
Tti
be
eligible
for
the
office
of
Resident
Representative,
a candidate shall:
(a)
be
at
least
twenty-five
years
of
age
on
the date
of the election;
225
- 61
-
(b)
be
a
citizen
of
the
United
States,
provided,
however,
that
prior
to
termination
of
the
Trusteeship
A^eanent
for
the
focmer
Japanese
Mandated
Islands,
61
Stat.
3301,
the
candidate
may
be
a
person
defined
as
a
United
States
citizen
or
United
States
national
in
section
8
of
the
Schedule
on
Transitional
Matters
of
the
Constitution
of
the
Northern
Mariana
Islands,
as
approved
by Presidential Proclamation 4534 of October
24,
1977;
(c)
have
been
a
resident
and
daniciliary
of
the
Northern
Mariana
Islands
for
at
least
seven
years
prior
to
the date of
taking office;
(d)
not
be,
on
the
date
of
the
election,
a
candidate
for any other office.
Sec.
4.
Acting
pursuant
to
legislation
enacted
in
accordance
with
the
Constitution
of
the
Northern
Mariana
Islands,
the
Government
of
the
Northern
Mariana
Islands
will
determine
the
order
of
names
on
the
ballot
for
election
of
Resident
Representative,
the
method
by
which
a
special
election
to
fill
a
vacancy
in
the
office
of
Resident
Representative
shall
be
conducted,
the
method
by
which
ties
bet'*een
candidates
for
the
office
of
Resident
Representative
shall
tie
resolved,
and
all
other
.Tiatters
of
local
application
pertaining
to
the
election
and
the
office
of
Resident
Representative
not
other-i/ise
expressly
nrcvided
for herein.
Sec.
5.
Until
the
Rules
of
the
House
of
Representatives
are
amended
to
provide
otherwise,
the
Resident
Representative
for
the
Northern
Mariana
Islands
shall
receive
the
same
canpensation,
allowance,
and
benefits
as
a
Member
of
the
House
of
Representatives,
and
shall
be
entitled
to
vhatever
privileges
and
immunities
that
are,
or
hereinafter
may
be,
granted
to
the
nonvoting
Delegate fron the Territory of Guam.
Land grant colleges .
Recarmendat ion .
Legislation
should
be
enacted
to
permit
land-grant
funding
of
a
pcst-secondary
educational
iastitution
in
the
Northern
Mariana
Islands.
226
MEMBERS
OF
THE
NORTHERN MARIANA
ISLANDS
COMMISSION
ON
FEDERAL
LAWS
Benigno
R.
Fitial,
Chairman*
Member,
House
of
Representatives,
Northern
Mariana
Islands
Commonwealth
Legislature
Saipan,
Northern Mariana
Islands
P«dro
A.
Tenorio,
Vice
Chairman
Lieutenant
Governor,
Commonwealth
of
the
Northern
Mariana
Islands
Saipan,
Northern
Mariana
Islands
Joel
J.
Bergsma**
Chief
Counsel,
House
of
Representatives,
Northern Mariana
Islands
Commonwealth
Legislature
Saipan,
Northern
Mariana
Islands
Jesus
C .
Bor ja
Attorney
at
Law,
Borja,
Mitchell,
and
Salas
Saipan,
Northern
Mariana
Islands
Dewey
L.
Falcone***
Attorney
at
Law,
Falcone
and
Falcone
Los
Angeles,
California
Robert
J.
Lagomarsinot
Member,
United
States
House
of
Representatives
Ventura,
California
Edward
DLG.
Pangelinan
Attorney
at
Law;
Legislative
Assistant
to
Congressman Ben Blaz,
United
States
House
of
Representatives
Saipan,
Northern
Mariana
Islands
and
Olney,
Maryland
*
Replaced
James
A.
Joseph
on
February
19,
1985.
**
Replaced Agnes
M.
McPhetres
on
February
19,
198S.
'**
Replaced
Myron
B.
Thompson
on
February
19,
1985.
t
Replaced
the
late
Congressman Philip
Burton
on March
9,
198'
227
HOUSE OF REPRESENTA TIVES
-
TENTH NORTHERN MARIANAS COMMONWEAL TH LEGISLATURE
FIRSTREGULAR SESSION, 1996
HOUSE JOINT RESOLUTION NO. Utl
A HOUSE JOINT RESOLUTION
To request that the United States Congress establish a non-voting Delegate from
the Northern Mariana Islands wUhIn the U.S. House of Representatives.
Offered by Representatives:
Diego T. Bonavente,
Joaquin G. Adriano, David M. Apaiang, Vicente M. Atalig, Jesus T. Attao, Oscar M. Babauta.
Roslky
F. Camacho, Crispin
I. Deleon Guerrero. Melvin O. Faisao, Maria (Malua)
T.
Peter,
Kan T. Rayes, Pete P. Reyes, Manuel A. Tenorio, P.Mtohael P. Tenorlo and Ana S. Teregeyo
0«e: January 17, 1996
HOUSE ACTION
Adopted: January 17. 1996
SENATE ACTION
Adopted: January 18, 1996
228
1 ENTH NOKTHERN MARIANAS COMMONWEAI.TII I.OGISIA'HJKI:
II. J. R, NO.
1 0-1
HllST REGULAR SESSION,
1 996
A
I lOUSE JOINl' RlSOLirnON
II
1'
To
request
thai
the United
Slates Congress
establish a non-voting
il
Delegate from the Northern Mariana Islands within the U.S. Mouse of
j
I
Representatives.
ji
1
|j
TAKING NO 11:
that the Covenant negotiatinu histoo' makes
it
rlcar
that
2
11 Section 901 does not preclude
the Government of
ilie Northern
Marianas from
3
j
j requesting that a Delegate from the Northern Mariana
i.slaiids be established in the
4
1
i Congress of United States;
5
;!
FINDING
that the current status of Commonwealth-federal
relations, which
6
'• has been marred by miscommunicaiion, misinterpretation, and misinformation
is
7
'\ further exacerbated by the lack of a con.siant and
vigilant Commonwealth voice
a
'! and presence
in
the
Hou.sc of Represeniarivcs and
ii.s various committees and
9
subcommittees;
10
FINDING
that
the
Northern
Mariana.s Commonwealth
Legislature
has
1
overwhelmingly approved two resolutions, namely lluuse Joint Resolution
8-5 and
12
Senate Joint Re.solution 9-6, urging the Congress of the United States to establish a
1
Delegate from the Northern Marianas within the U.S. Hou.se of Representatives;
14
OBSHIVING that Article V, .Section
2. of the Commonwealth Constitution as
15
amended by Constitutional Amendment
24, provides that the United States may
16
confer the status of nonvoting member delegate
in the United States Congress on
17
the Resident Representatives;
18
RDC0GN1/.ING with graUiudc that on August 10, 1994, (Juam Delegaie Robert
19
Underwood introduced
Il.R. 4927 in the
103rd Congress,
to provide a nonvoting
20
'' delegate
to the House of Represeniativcs
lo represent
the Commonwealth of the
21
Nnnhcm Mariana Islands;
229
1
2
3
4
5
6
7
8
9
30
11
12
13
14
15
I(>
17
18
19
20
21
22
23
24
25
20
27
28
29
30
31
32
3f3
34
HOUSn JOINT RHSOUniON NO. KM
BELIEVING fervently ihar the pursuit of ihe delegate seat
is imperative
in
ailuining
full status
as a member of ihe American
political family in which thus
far the Northern Mariana
Islands remains
the only
U.S.
insular area not
to be
reprcsenied in the United States Congrcs-s;
HOLDING TO
BI: TRUE that non-voting
delegate
status
for
the
Resident
Representative would neither diminish the
full force and effeft of the Covenant to
Establish
a Commonwealth
of the Northern Mariana
Islands
in
I'olitical Union
with the United
States of America nor
in any
sen.sc abrogate,
qtialify, or release
rightful claims
to
local self-government contained
in
Article
I, Section
10.^ of the
Covenant;
li is
RESOLVnO by the nou.tc of Representatives of the Tenth Northern Marianas
Commonwealth
I/rgislaturc, the Senate concurrins;. that the 104th Congress of the
United States of America is hereby requested to:
(1) CONFKR
the status of nonvoting
dclcp.atc
in
the United
States
Congress on the Resident Representative;
(2) I'ROVIDE that
the Delegate from
the Northern Mariana
Islands
receive the same compensation, allowance, benefits and be entitled to those
same privileges and immunities as a Member of the United Slates House of
Represen tativcs;
(3)
WORK CLOSELY with
the present Resident Representative
in the
drafting
of federal
legislation necessary
to realize the
Delegate from
the
Northern Mariana Islands; and
RHSOLVING FURTHER that the Speaker of the llotise and the President of the
Senate shall certify and the House Clerk and the Senate Legislative Secretary shall
attest to the adoption of this Resolution and thereafter transmit ccrtilied copies
to:
the
Honorable
William
Jefferson
Clinton,
President
of
the
United
States;
the
Honorable Newt
Gingrich, Speaker
of
the
U.S.
House
of
Representatives;
the
Honorable Richard Armey, Majority Leader of the
U..S. House of Rcpreseniaiives;
the
Honorable
Richard
Gephardt,
Minority
Leader
of
the
U.S.
Mouse
of
Representatives;
the Honorable Don Young,
U.S. House
of Representatives;
the
Honorable
niton
Gallegly,
U.S. House
of Representatives;
the Honorable George
Miller,
U.S. House
of Representatives;
the Honorable
Lni
F.J.
laletmiavacga,
U.S.
House
of
Representatives;"
the
Honorable
Robert
Underwood,
U.S.
House
of
Representatives;
the
Honorable
lileunor
ri<ilmes
Norton,
U.S.
House
of
Page 2
230
HOUSr. JOINT KlSOl.UnON NO. 10-1
Ucpreseniaiivc's;
the
Honorable
Carlt).s
Romero-Riir<do,
U.S.
Mouse
of
Rcpresemativcs;
ihe Honorable Victor I'mzcr,
U.S. Douse of Keprcscniaiivcs;
the
Honorable Al Gore, Vice President of the UnKod States and President of the U.S.
Senate;
the
Honorable
Robert
15ole,
Majority
Leader
of
the
U.S.
Senate;
the
Honorable Tom
IXisdlle, Minority Leader of the
U.S.
S'enaic; the Honorable Frank
Murkowski,
U.S.
Senate;
the
Honorable
J.
Bennett
Johnston,
U.S.
Senate;
the
Honorable Daniel Inouye, U.S. Senate; the Honorable IDiinicl Akaka, V.S. Senate; and
the Honorable Bruce Babbitt, Secretary of the U.S. Department of Interior.
Adopted by the House of Representatives on January
1 7, 1906
and by
the Senate on January 18, 1950
CnRTIFlhl^ BY:
czhQ ^
DIK50 T. BtNAVWTE
Speaker of the House
fI5US R. SA15IAN
rc.sidcnt of the .Senate
AITliSTED UY:
tVKLYN C.
House
I
J-JllING
k
nh^lRY DLG. .^N NICOI/S
.Senate Legi.slaiflvc Ser.rcrary
I'aue
h.
'
Prepared statement of Sebastian Aloot
TESTIMONY OF SEBASTIAN ALOOT
ACTING ATTORNEY GENERAL
COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
before the
UNITED STATES HOUSE OF REPRESENTATIVES
SUBCOMMITTEE ON NATIVE AMERICAN AND INSULAR AFFAIRS
June 26, 1996
Thank you Mr. Chainnan. My name is Sebastian Aloot and
I am the Acting
Attorney General of the Commonwealth of the Northem Mariana Islands ("CNMI").
I
appreciate this opportunity to testify
before your Committee concerning the recent
report by the Department of the Interior on the labor, immigration and law enforcement
initiative in the CNMI
( the "Task Force Report") and related issues.
1.
The Covenant and Self-Detemiination
This Congress began with much discussion of the Contract with America. A
generation ago, the people of the Northem Mariana Islands entered into their own
contract with America-the "Covenant to Establish a Commonwealth of the Northem
Mariana Islands in Political Union with the United States of America " That contract,
remarkable for its time, translated America's thirty year trusteeship over the Northern
Mariana Islands into a unique political relationship as part of the United States but
preserving local self-determination over such things as immigration, minimum wage and
taxation.
It also signaled the beginning of the end of the Trust Territory Government,
something one Micronesian leader characterized as a system of federal administration
where the United States had the territory and the Micronesians had the trust. Although
much has changed in the intervening two decades, the vision of the leaders that crafted
the Covenant and the reasons for its preservation of local control over what are
essentially local issues have not.
At the outset we note that in defining the relationship between the
Commonwealth and the U.S. government. Section 902 of the Covenant prescribed a
very specific consultative process for addressing "all matters affecting the relationship"
between the two. While we have invoked these procedures to address our concerns,
we note that the U.S. government never has.
Instead, we have found ourselves
232
continually coming to Washington to address matters before Congress that could
othenwise be dealt with under the express temis of the Covenant.
2.
The Benefits and Cost of Economic Success
The most obvious of the changes in the past 21 years has been the phenomenal
economic growth of the Commonwealth.
In the last decade alone, the total reported
business gross revenue has skyrocketed from some $224 million in 1985 to nearly $1.5
billion last year.
In the same period, both the Gross Island Product and domestic loans
have more than tripled and bank deposits have increased nearly four-fold.
Visitor
entries are five times what they were in 1985 and visitor expenditures have increased
from $122 million to $522 million during the decade.
The results of this robust economy have been dramatic.
Formerly a forgotten
and dependent federal reservation, the Commonwealth is now virtually self-supporting.
General Federal funding of its operations declined from two-thirds of the General Fund
revenues in 1978 to zero after 1992.
While Federal funding is still provided for capital
improvement projects and direct federal grants, the amount of Federal funds received in
FY 1995 is now only about 10% of total revenues.
Formerly a government with
significant and growing deficits, the Commonwealth now operates with a surplus and
the elimination of past deficits is within our grasp.
However, the benefit of modemization and dramatic economic growrth has not
been without its cost.
Like the rest of America, we have witnessed an increase in
crime, in the use of drugs, in social dislocations and in violations of civil rights and labor
laws.
At the same time, increased public and governmental scrutiny has shed light on
poor working and living conditions, particularly among the many alien workers in the
Commonwealth, and has prompted even more complaints, some substantiated and
some not, of improper or illegal conduct on the part of private employers or
governmental entities. We in the CNMI continue to be troubled by the continued
characterization of these problems as "human rights abuses" by those outside the
CNMI, when in reality these problems are exactly the same problems that the rest of
America is experiencing in the last quarter of the twentieth century. The issue is not
that they have happened...the issue is what is being done to address them.
3.
The Tenorio Administration Takes Charge and Responsibility
When the Tenorio Administration came into office in January, 1994,
it faced a
host of problems, including a stagnant economy, fiscal mismanagement and chaotic or
ineffective law enforcement, particularly in the area of labor and immigration. And when
Governor Tenorio appeared before the last Congress, he was not coy about the
Commonwealth's past failures in these areas.
Nor was he reticent about his intention to
honestly address those problems.
Since then, he has not hestitated from making the
hard, sometimes unpopular, decisions necessary to implement corrective action. He
has put into place the major steps to redress years of inattention and the problems that
233
had arisen during that time. As a result, the focus of public debate has now shifted to
the degree of success that these solutions are now beginning to achieve.
4.
Executive Branch Task Force Report
Earlier this month, the Department of the Interior released its second annual
interagency task force report on labor, immigration and law enforcement in the CNMI.
The Task Force Report acknowleges that the CNMI and Federal agencies are making
clear progress in law enforcement but nonetheless makes two recommendations for
legislation:
(1) to federalize the minimum wage in the CNMI and (2) to direct the CNMI
to spend Covenant funds for construction of new prison facilities.
The Report chronicles the activities of federal agencies addressing their federal
responsibilities in the Commonwealth, much of which has been paid for with funds
originally commited to infrastructure development in the Commonwealth.
This has been
done with the support and urging of Governor Tenorio, who recognizes that protection
and enhancement of our human infrastructure is perhaps as important to our future as a
community than the quality of our roads. While we appreciate the fact that these
agencies have been asked to do their job, we are concerned that
it is being done with
our Covenant funds, not with federal dollars. We are not alone in that concern. The
House Approphations Committee in its report on the Interior Appropriations
bill for
FY'97 expressed concem about the lack of financial commitment by other Federal
agencies to the immigration, labor and law enforcement initiative in the CNMI and
warned that the Committee would be closely watching with respect to future funding
decisions on the initiative. We are also concerned about the inherent Inefficiencies in
having Washington study the problem, rather than allowing us to devote the same
resources to getting more of the job done.
And in fact, we are getting the job done.
Perhaps the best example of the
progress in addressing the problems facing alien workers comes from the Philippines,
where most of the foreign workers in the CNMI are from originally.
In the face of
growing concerns over reports of labor problems encountered by Filipinos working in
the CNMI and against a backdrop of serious abuses of its citizens in other parts of the
world, the Philippine government imposed a highly publized ban on the deployment of
several classes of workers to the Commonwealth. Based on the Tenorio
Administration's labor reform and enforcement initiatives and a spirit of cooperation
unmatched by other jurisdictions, that ban was lifted early last month.
Indeed, a week
ago
I accompanied Governor Tenorio to Manila to meet with President Ramos.
I can
report that the topic of discussion was not the past issues that divided us but the
cultural, historical and economic issues that bind us together.
234
5.
The Successful Implementation of the Computerized Alien
Tracking System has Helped to Address Immigration
Concerns
A key area addressed in the Task Force Report involves the immigration of guest
workers into the CNMI.
Identified as an area of potential concern several years ago,
Congress allocated a portion of CNMI Covenant monies to fund the design and
implementation of a computerized tracking and identification system to monitor alien
residents and guest workers. Known as the Labor and Immigration Identification and
Documentation System or "LMDS", this prototype system has recently become
operational and is making dramatic progress. Already thousands of guest worker
records have been entered into the data base, with some 27,000 expected to be
processed by next month.
This information is used to support the issuance of CNMI entry permit cards that
will dramatically facilitate enforcement efforts. Through a special high security
application integrated with an image capture/storage/retrieval system,
it will far surpass
what any INS system currently can do.
Conceptually
it will have the capability to
capture information on arrival and departure in real time, immediately to access
individual status and issue secure documentation to all foreign workers and alien
residents upon arrival - requirements that the INS can not fulfill with its current system.
The LMDS project is being developed in consultation with the U.S. Immigration and
Naturalization Service which is providing an Independent Validation and Verification
process.
In fact, the INS is enthusiastic about this project as a prototype to be
developed for other applications in the United States.
This system is expected to advance significantly the ability of the CNMI to track
the whereabouts of guest workers and to monitor labor and immigration status and for
entry and exit control purposes. The CNMI has geographical advantages in controlling
entry since air and sea are the only options, all which will be closely monitored and
regulated. Those who overstay their tourist or work permits are the real concern, and
the LIIDS system will be designed to address this problem.
In addition, we have
established a separate deportation fund that will provide the necessary financial
resources to pay for the actual deportation of those who are in the CNMI illegally.
Actual deportee numbers are projected to increase four-fold this year with the
implementation of the new system and enhanced enforcement.
We believe that LIIDS, and the concerted effort being devoted to immigration
issues, will enable the CNMI to overcome the real problems in administering the
immigration system.
However, the concems discussed in the Task Force Report raise
policy questions that go beyond the simple administration of the immigration laws, but
challenge our fundamental right to control our own economic future. The simple fact of
the matter is that our economy has outgrown the number of U.S. citizens available. We
do not have the adult population to sustain our work force and economy. Even
if our
235
entire able-bodied population worked in the private sector, we would still need large
numbers of foreign guest workers for some years to come.
This is not a unique situation. There are many examples around the globe
where countries with excess labor export workers to countries with insufficient
populations. The exporting country benefits from the payments their citizens receive
and by having more jobs. The employing country benefits from growth, lower costs,
and greater competitiveness. We are mindful of the need to monitor the situation, to
guard against abuses, to correct problems as they occur and to take care that
employers carry 1heir fair share of infrastructure and other costs.
But we are troubled by the patemalistic observation in the Task Force Report of
the perceived "irony" that local control of immigration has had the opposite affect from
what was intended, because "native Chamorro and Carolinian culture and influence"
somehow is thought to have been diminished, based solely on current population
numbers. The island culture has managed to survive three centuries of Spanish
domination, and periods of German and Japanese occupation all preceding the 50 year
affiliation with the United States.
In fact, many of us believe that immigration can enrich
our culture, much as
it has done in the United States itself. The conclusion that the
CNMI has failed to carry out a clear policy based on public understanding and assent,
by acquiescing to the "desires of those who can make the most profit from bringing in
alien workers" loses sight not only of this history but also of why temporary workers are
on the islands in the first place.
Their contribution to the economy is the investment
and development that they make possible. When you consider the contribution to our
Gross island Product and our tax base of the businesses that employ nonresident
workers, their presence does not just help our economy,
it is a significant part of our
economy.
We are particularly troubled by the misleading figures used in the Task Force
Report to support conclusions that are not justified by the facts.
For example, in an
apparent effort to demonstrate the distorting impact of guest workers on the future
composition of the population, the Report states as follows:
Already twenty-five percent of the CNMI school population of
8,880 students are children of aliens.
Virtually the entire
increase in these children of aliens has occurred within the
last decade, with most of the increase in the last five years.
Based on the under-five population, geometric increases in
this student population can be expected in the next decade.
Task Force Report at 4
The clear implication of this passage is that these are the children of guest
workers who are having so many children in the CNMI that the schools, and eventually
the Commonwealth, will be overtaken. What this Report ignores, and what makes the
236
Report so misleading,
is the fact that fully 80% of these students are the children of
Micronesians for whom CNMI
is required by U.S. law to provide educational and other
services under the temns of the Compact of Free Association. We are now engaged in
litigation before the Federal courts seeking to clarify our immigration obligations to
citizens of the Micronesian Freely Associated States.
In addition, Guam and the
Commonwealth have recently initiated litigation seeking to force the Executive Branch
to finally discharge its long-ignored duty to seek annual appropriations to address the
negative impacts of free immigration by Micronesians. The State of Hawaii is now
considering whether to join this litigation.
I hope that by clarifying this important point,
this Committee will begin to see that the problem of immigration lies on both sides of
the Pacific.
The problem is not that guest workers are in the CNMI in the first place, but that
they may not be temporary.
That is a problem that can be, and
is being dealt with
through the LMDS program. To keep these workers out in the first place is not a
solution, but only another probably larger problem. We agree with the recognition
expressed by the Task Force that any immigration control options "must give
consideration to self-govemment in the CNMI and local economic development needs."
But we can not agree with the conclusion that should the CNMI somehow fail to make
immigration control "become more effective" (whatever that means) within the next
year, that the federal role in local immigration matters should automatically increase.
No one in the INS, let alone the CNMI, wants that result.
6.
A More Rational Approach to the Minimum Wage Issue
There seems to be no more vexing policy issue in Washington, DC.
regarding
the CNMI than the minimum wage.
Like the long and contentious debate in both the
Senate and the House in recent months, whether or not to raise the minimum wage is
an issue about which there can be, and
is, an honest difference of opinion.
It is one
that confounds the most responsible decision makers.
Just like the U.S. Congress, the
CNMI legislature has members on both sides of the issue. And depending on the
composition of the legislature at any given time, the legislation that is enacted will likely
change.
This issue has been vigorously debated in the CNMI for many years, long
before the Tenorio administration took office. And
it has been the subject of debate on
the mainland for decades.
Dismissing this legitimate public debate as a "policy of
vacillation," the Task Force Report would pre-empt the democratic process in the CNMI
and arbitrarily impose a Federal scheme that bears little relation to the circumstances in
the Commonwealth.
a.
The Unique Facts in the CNMI Require Something More
Than a "One-Size-Fits-AII" Federal Solution
The Task Force recommendation to increase the minimum wage to the required
level on the U.S. mainland is an arbitrary adjustment that ignores fundamental
differences between the two jurisdictions.
In the Commonwealth, guest workers receive
6
237
many employee benefits, such as housing, local transportation, food and medical care
(and not just insurance, but full medical care), that their counterparts on the mainland
do not receive. These benefits have been valued by our Department of Commerce as
the effective equivalent of a minimum wage oi $4.68 . a figure that is well in excess of
the current minimum wage on the mainland (even including the recent increase passed
by the House of Representatives, assuming
it were ultimately to be enacted). There
may well be other facts that dictate yet a different figure or varying figures, depending
on the industry. A fundamental problem has been the absence of any thorough
analysis of the composition of existing wage packages, the impact of increasing wages
on the workers or on the viability of the principal labor-intensive industries in the CNMI,
which are the very heart of its economy.
In certain non-mainland areas where there is federal jurisdiction over the
minimum wage, Congress has recognized these differences and has relied on local
industry committees when implementing minimum wages rather than an across the
board approach.
Significantly, this has been done only a/ifer a thorough review of the
particular economy, local wage levels, economic conditions, employment data, trends,
industry production costs and financial conditions.
In fact, Congress has required that
attention be given to "economic and competitive conditions" to be sure that
employment in the industry "will not be substantially curtailed." 29 USC 208(b).
In
American Samoa, for example, there are 14 separate categories of businesses
including the hotel, tour and travel service, construction, printing/publishing, hospital,
wholesaling, and financial industries to name only a few. Each industry has a differing
wage rate ranging from $2.25 to $3.50 per hour. See 29 CFR Part 697.
As explained in more detail below, the CNMI legislature has adopted a similar
approach in the current law which recognizes industry differences within the CNMI.
Moreover, completion of the comprehensive and independent study that is currently
undenAray will provide for the first time the data and analysis that will permit a more
rational resolution to this complex issue.
b.
The Elusive "Agreement" Between the CNMi and the
Department of Interior
One of the more troubling aspects of the current debate in Washington, D.C. with
respect to the CNMI
Is the unexplained significance given to the minimum wage
formulation reflected in Public Law 8-21
.
It is as
if
it constituted some kind of binding
agreement between the CNMI and the Federal government against which all minimum
wage fonnulations are to be measured.
This CNMI law set up an automatic schedule of
incremental, across-the-board, 30 cent increases in the minimum wage over a period of
years until the federal minimum wage level was reached. Exempted from this public
law were several categories of workers including farmers, fishermen and domestic
household workers, the very workers which have been the subject of the most
egregious of the alleged labor problems.
Moreover, the law created a Wage and Salary
Review Board, chaired by a garment industry representative, to review the differences
/
238
among industries. While this solution to the minimum wage problem reflected the
particular political consensus at the time,
it did not reflect a particularly rational or
studied analysis of the impact of such an increase on the economy of the CNMI.
In
fact, to the extent that we can determine, there was no economic evaluation in setting
these proposed wage levels.
Yet the Task Force Report elevates Public Law 8-21 to a new level, suggesting
that any departure from
it is somehow an inexcusable breach of an explicit contract.
The Report, for example, states that the approach embodied in the current law (Public
Law 10-13) "voids the original intent \o systematically move the CNMI wage to the
Federal level" (emphasis added).
Yet the Report offers no explanation as to why Public
Law 8-21 should constitute the "original intent" any more than the preceding statutory
scheme or the cun-ent law (Public Law 10-13).
Each is a legitimate statute in so far as
it
was achieved through the democratic process by the elected representatives of the
CNMI at the time.
Since Public Law 8-21 was enacted in 1993, there has been a new
legislature and a new Governor in the CNMI, and a complete turnover in control of the
U.S. Congress.
For the 104th Congress to pass the legislation requested in the Task
Force Report that would hold the current CNMI legislature and the Tenorio
Administration to the policies of Public Law 8-21 as enacted by the previous CNMI
legislature and the previous Governor fails to recognize the inherent dynamics of the
democratic process.
It is particularly troubling given the obvious shortcomings of Public
Law 8-21 which failed to address household domestics, the group with the most
significant allegations of abuse, or to study adequately the underlying conditions
needed to detennine the affect of a wage increase on the overall CNMI economy.
c.
The Current Approach to the Minimum Wage in the CNIVII
Provides a Rational Process for Reaching a Sound
Solution
After months of additional debate and discussion about the best way to
implement changes in the minimum wage, the current legislature passed, and the
Govemor signed, legislation that is designed to reach a long-term solution to the
problem of what to do with the minimum wage, as well as addressing some immediate
problems.
Specifically, this new law, Public Law 10-13, increases the minimum wage
by 30 cents across the board, effective July 1st in ail industries (except the construction
and garment industries which will phase in the same increase evenly over a two-year
period).
Significantly, as demanded by the Tenorio Administration, the new law also
includes domestic household wori<ers and farmer workers and fishermen, all of whom
were exempt under the previous law which the Department of Interior now finds so
compelling.
It mandates a very substantial 50% increase in the monthly minimum wage
in these categories (from the current $200 per month minimum to $300 per month).
In
addition, the Department of Labor has proposed regulations imposing minimum
household incomes before authority to employ a guest worker is granted. By
I
8
239
substantially increasing the minimum wage in this category,
it is expected that the
number of domestics will drop precipitously, and because they are largely foreign
workers, they will leave the Commonwealth.
Unlike hotel or gannent workers, such a
reduction in the work force of domestics will not have a direct debilitating effect on key
industries.
The most important feature of the new approach, however, is the mechanism to actually
study and understand the impact of these decisions. The Governor has contracted with the
Hay Group a world-recognized management and human resources consulting firm that will
undertake the first comprehensive evaluation of the minimum wage situation in the CNMI since
the Covenant was signed, nearly 21 years ago
Unlike the Wage and Salary Review Board, of
which the Task Force was critical because of the presence of gamient industry
representatives, this approach is free from even the appearance of conflict of interest, and will
produce a full-scale study with educated, realistic and objective recommendations based on
credible information upon which decisions can then be based about the minimum wage.
For
the first time in our history, we will have an understanding of the impact our decisions will have
on our economy. To date the debate has been characterized by emotional reactions, whim,
and fear of what Washington might to do to the CNMI unless changes are made.
At last we
will have a basis for making a rational, intelligent and responsible decision.
All that we ask
from you is to be allowed to complete the process.
The real question for your Committee is whether the present law in the CNMI is
so devoid of rationality, or so offensive to Constitutional principles, that
it justifies
altering the balance reflected in the original Covenant that reserved minimum wage
determinations to the CNMI. We do not think the record supports such intervention -
^
primarily because there is no record one way or the other - on the merits of changing
the minimum wage in the CNMI.
It is our expectation that the Hay Group will provide
the basis for just such a record.
d.
The Minimum Wage Should Not Be Manipulated to Solve
Non-Wage Problems That Can Be Dealt With Directly
Finally, no discussion of the minimum wage is complete without looking behind the
initial rhetoric to the real reason the increase is being proposed by the Task Force Report.
One need not look far. The Report's recommendations candidly cite what appear to be the
real reasons for seeking the increase:
[tjhere will be a favorable effect on related problems including
illegal employer labor actions, strain on infrastructure, organized
crime and illegal drugs.
In our view, reducing the existing
incentives to hire alien workers at lower wages than those
prevailing for local woricers should help slow uncontrolled
immigration and perhaps help prevent the need for greater Federal
:
;
, ..
control of immigration.
240
Task Force Report atpp 8-9.
If the real purpose in raising the minimum wage is to address these problems,
why not deal with them individually and directly rather than jeopardize the economic
viability of the CNMI?
Illegal employer labor actions, organized crime, illegal drugs can
all be dealt with by enforcing existing laws -- which incidentally, appears to be well
underway judging by the Task Force Report's own conclusions about the increase in
law enforcement efforts.
Similarly, immigration problems can be dealt with directly
through the LMDS program and the local immigration laws, rather than jeopardizing the
economic livelihood of the Commonwealth.
To approach these problems by shutting down the economy is to throw the baby
out with the bath water.
It is simply the wrong remedy for the perceived problems.
It is
as
if the proposed solution to securities fraud were to close the stock exchange.
It
would surely eliminate the problem, but at what cost? The rational solution, of course,
is to enforce the securities laws, or enact more stringent ones,
if the current laws are
not doing the job.
Surely no one would shut off the source of investment capital to cure
the occasional incident of securities fraud.
Similarly Congress should not effectively
drive fundamental businesses out of the CNMI, just so
it can ease the burden of
attacking possible criminal activity or violations of labor laws.
7.
Prison and Detention Facilities
The Task Force Report recommends that Congress direct the CNMI to utilize
Covenant funds for prison and detention facilities.
This issue, and the
recommendations of the Task Force, were clearly identified to Governor Tenorio in a
letter from the Director of the Office of Insular Affairs. We too have recognized that as
our law enforcement efforts become more productive, our prison facilities will need to
be improved. And we agree with the goals outllined by the Task Force Report and are
ready to work with the federal officials in developing adequate prison and detention
facilities.
However, we must object to the proposal that this recommendation be
legislated by Congress. We can make this decision and meet these needs in
cooperation with federal authorities without new legislation. That is simply not needed,
nor warranted.
We are also concerned about the directive that Covenant funds be used for this
purpose.
While we may conclude that they should be used, they are not the only
source. We have been actively searching for altematives and have identified the
Violent Offender Incarceration and the Truth in Sentencing Incentive Grant programs as
potential sources. These programs could provide the bulk of the funds required to
construct the recommended 200 bed facility and we would propose in that case to use
a portion of our Covenant funds to meet the matching fund requirements of these and
other grant programs.
10
241
Additionally, we will continue our work with the National institute of Corrections
(DOJ) to address operational and management concerns. The CNMI understands that
the construction of a new facility is only half of the equation. The promulgation and
implementation of standards in training, inmate management, and other areas are
needed to complete the task.
8.
Inspector General Report on Management of Public Lands
Finally, you have requested our comments on the report of the Department of
Interior's Inspector General with respect to the management of public lands in the
CNMI.
Let me begin by pointing out an underlying misassumption with the entire report.
One stated objective in carrying out the report was to detennine whether the
Commonwealth was effective in "controlling and utilizing U.S. Government land
transferred to the Commonwealth". The problem, of course, is that these lands were
not U.S. Government lands. They were controlled by the Japanese Government and
Japanese nationals prior to June 1944.
Following the Second World War they were
managed by the Trust Territory Government, which was created by the United Nations.
While
it is true that the U.S Government administered the Trust Territory Government
until creation of the Commonwealth, the Trust Temtory Government was not a part of
the U.S. Government, and the public lands were not U.S. Government lands. The have
always belonged to the people of the Northern Mariana Islands first in trust and now
directly.
With respect to the particular recommendations of the IG Report, the
Commonwealth is well undenway in its implementation of new procedures.
For
example, new land exchange regulations became effective last month that require land
exchanges to be based on appraisals of fair market value.
With respect to the management of leases, the Division of Public Lands has had an
infomnal policy of renting public lands at 8% of the value of the land.
This has
intentionally been a flexible policy, however, since there may be educational, cultural,
economic or other benefits to the Commonwealth in addition to the actual rent being
paid which are important to consider. We have also assigned additional attorneys to
assist in the collection of lease payments and recovery of lands improperly taken. We
have hired a new manager of the Account Compliance Section who is experienced in
both business and computer technology. We have also hired a new Land Enforcement
Manager who is working to improve on-site inspections of lessess and permittees.
Finally, with respect to homestead administration, we have hired a new Homestead
Manager who has instituted new policies for the review of homestead applications to
ensure elegibility and need.
Govemor Tenorio has responded in detail to the IG Report and
I am including for
the record a copy of that response.
11
242
9.
Conclusion
America was founded on the spirit of self-reliance and the concept of individual
responsibility for solving local problems with local solutions.
Having accepted
responsibility for correcting the situation the Tenorio Administration inherited, permit us,
as contemplated by the Covenant and as is part of the political heritage which the
people of the Commonwealth have adopted as their own, to also retain continued
responsibility for its solution.
There is much talk in the halls of government about authority and responsibility.
Authority is the power to say yes.
Responsibility is the widsom to say no when one has
the power to say yes.
The Congress clearly has the authority to say yes to the legislative proposals
bafore
it.
In the name of the good people of the CNMI, however,
I ask that you show
the wisdom to say no to an unwarranted federal intrusion in the political decision-
making of the Commonwealth as we continue to implement local solutions to local
problems.
I want to thank you, Mr. Chairman, and the Committee for this opportunity to
appear before you.
I would be happy to answer any questions or to provide any
additional information for the record.
Thank you.
12
243
Prepared statement of Samuel F. McPhetres
MR CHAIRMAN, DISTINGUISHED MEMBERS OF THIS COMMITTEE AND
REPRESENTATIVES OF THE COMMONWEALTH OF THE NORTHERN MARIANA
ISLANDS. IT IS A DISTINCT HONOR TO BE HERE TODAY FOR A VARIETY OF
REASONS. MANY YEARS AGO I WORKED FOR ALASKA SENATOR BOB BARTLETT
SHORTLY AFTER WE ACHIEVED STATEHOOD IN ALASKA
I ALSO TAUGHT HIGH
SCHOOL HERE AT CARDOZO HIGH FOR A COUPLE OF YEARS A LONG TIME AGO.
IT IS ALSO SIGNIHCANT FOR ME TO BE HERE BECAUSE I WA^ PRESENT AT THE
NEGOTL\T10NS LEADING TO COMMONWEALTH FOR THE NORTHERN MARLANA
ISLANDS AND ALL SUBSEQL'ENT HISTORICAL EVE^H'S FOLLOWING.
AS CURRENT PRESIDENT OF THE SAIPAN CHAMBER OF COMMERCE I TAKE
PARTICULAR PRIDE IN REPRESENTING A VIBRANT AND VERY ACTIVE PRIVATE
SECTOR IN THE NEWEST AMERICAN TERRITORY.
MR CHAIRM.'^N, WE WERE .AJSKED TO COMMENT ON SE^/EPJd. '^/HRY IMPORTANT
ISSUES FACING THE COMMONWEALTH AT THIS TIME.
I WILL TOUCH ON EACH
OF THEM BRIEFLY AND WILL WELCOME QUESTIONS OR CLARfflCATIONS
SHOULD THERE BE ANY.
iVDNEVIUM WAGE
FIRST, ON THE QUESTION OF MINIMUM WAGE, LET ME MAKE IT ABUNDANTLY
CLEAR THAT THE SAIPAN CHAMBER HAS CONSISTENTLY SUPPORTED PUBLIC
LAW 8-21 WHICH MANDATED THE ANNUAL SJO/HR. WAGE INCREASE ACROSS
THE BOARD. WE WERE, IN FACT, PARTICIPANTS IN THE DRAFTING OF THAT
LEGISLATION. WE MAINTAIN THAT POSITION TODAY. WE DO FEEL, HOWEVER,
THAT IT IS IMPORTANT FOR THIS COMMITTEE TO UNDERSTAND THAT IN THE
CNMI THE QUESTION OF MINIMUM WAGE IS NOT SIMPLY ONE OF WAGES. IN THE
FIRST PLACE, THE PRIVATE SECTOR IS MADE UP LARGELY OF CONTRACT
WORKERS FROM OUTSIDE. LOCAL LAW REQUIRES THAT THE EMPLOYERS
1
244
PROVIDE TRANSPORTATION TO AND FROM WORK, ROOM AND BOARD, MEDICAL
CARE AND REPATRIATION COSTS. THE VALUE OF THESE MANDATED BENEHTS
VARIES FROM $1 .50 TO $2.00/HOUR. ADDED TO THE CURRENT MD^IMUM WAGE
OF S2.75HR, THE WAGES PAID IN REAL VALUE ACTUALLY EXCEED THE FEDER.AL
MINIMUM WAGE. IT IS THE POSITION OF THE SAIPAN CHAMBER OF COMMERCE
THAT AS THE LEGAL MINIMUM WAGE RISES THE MANDATED BENEHTS MUST BE
REDUCED COMMENSURATELY.
BUT THIS IS A LOCAL LEGISLATIVE MATTER
WHICH WE N-njST DEAL WITH. ANY DISCUSSION OF MINIMUM WAGE IN THE
COMMONWEALTR MR CHAIRMAN, MUST INCORPORATE THIS VERY IMPORTANT
FACTOR. FOR THE MOST PART, THE REAL MINIMUM WAGE IN THE CNMI MEETS
OR EXCEEDS THE FEDERAL MINIMUM WAGE.
I WOULD NOTE IN PASSING THAT
VERY FEW US CTTIZENS ARE MINIMUM WAGE EMPLOYEES AT ALL, CERTAINLY
NONE WORKING FOR THE CNMI GOVERNMENT.
I WOULD CONCLUDE BY SAYING
THAT WE HOPE THAT THE FEDERAL GOVERNMENT WILL ALLOW US TO WORK
THIS OUT INTERNALLY. TO FEDERALIZE THE MINIMUM WAGE WITHOUT
nFATmn WITH THE LOCALLY MANDATED BENEFITS WOULD WREAJC RAVOC
WITH THE LOCAL ECONOMY.
WE ALSO APPLAUD THE GOVERNOR'S ACTION IN CONTRACTING WITH THE HAY
GROUP TO DO A SERIOUS AND PROFESSIONAL STUDY OF THE MINIMUM WAGE
ISSUE THROUGHOUT THE COMMONWEALTH SYSTEM, BOTH PRIVATE AND
PUBUC SECTORS.
IMMIGRATION
ON THE ISSUE OF FAIR TREATMENT OF NON-RESIDENT WORKERS THE SAIPAN
CHAMBER OF COMMERCE WISHES TO ASSURE THE COMMITTEE THAT IT STANDS
SQUARELY AGAINST LABOR ABUSE IN ANY FORM. OUR CODE OF ETHICS
MANDATES EXPULSION FOR ANY PROVEN ABUSIVE BEHAVIOR NO CURRENT
245
MEMBER IN THE PAST FIVE OR SO YEARS HAS BEEN FOUND IN VIOLATION OF
ANY APPLICABLE STATUTE. IN ADDITION, THE CHAMBER MAKES IT A POINT TO
SPONSOR WORKSHOPS AND SEMINARS FOR MEMBERS AND THE GENERAL
PUBLIC ON LABOR ISSUES. WE HAVE HAD THE U.S. DEPARTMENT OF LABOR,
THE CNMI DEPT. OF IMMIGRATION AND LABOR, NLRB AND OTHERS AT VARIOUS
TIMES OVER THE PAST YEAR, FOR EXAMPLE PRESENT THEIR PROGRAMS TO THE
PUBLIC.
THAT SAID, THERE IS NO QUESTION THAT THERE EXISTS A SERIOUS PROBLEM.
SOMETIMES THAT PROBLEM EXISTS MORE IN PERCEPTIONS THAN FACT, BUT
NONETHELESS IT IS THERE. PART OF THE PROBLEM IS BASED ON SHEER
NUMBERS. WITH TWO THIRDS OF THE POPULULATION NON-RESIDENTS, MANY
OF THEM EMPLOYERS IN THEIR 0^mi RIGHT, THERE IS FREQUENTLY A
BREAKDOWN IN COMMUNICATION AND UNDERSTANDING OF WHAT THE LAW IS.
WE ARE CONSTANTLY WORKING TO EDUCATE OUR MEMBERS AND TO SET
EXAIviFLES FOR THE REST OF THE COMMUNITY.
Vi/E .\PJ: ALSO R£.^Y TO WORK
WITH LOCAL AND FEDERAL AGENCIES IN DEALING WITH THE PROBLEMS.
I
WOULD SAY, MR CHAIRMAN,. THAT THERE HAVE BEEN MANY MANY
IMPROVEMENTS OVER THE PAST SEVERAL YEARS AND COMPARED TO HOW
THINGS WERE FIVE YEARS AGO, WE ARE FINDING FEWER INSTANCES OF ABUSE.
A SIGNfflCANT REASON FOR THIS IS THE ACTIVE PARTICIPATION OF THE FAIR
LABOR STANDARDS ADMINISTRATION AND OSHA OVER THE PAST COUPLE OF
YEARS.
WE WOULD LIKE TO CONCLUDE THIS SECTION BY NOTING THAT THE CHAMBER
IS ACTIVELY SEEKING MORE AMERICAN BASED INVESTMENT THAT IS NOT
LABOR INTENSIVE. AT THE PRESENT TIME WE HAVE TWO MAJOR INDUSTRIES
THAT FORM THE BACKBONE OF OUR ECONOMY: TOURISM AND THE GARMENT
INDUSTRY. WHILE THE GARMENT INDUSTRY IS NOW STATIC AT ABOUT 7,000
246
EMPLOYEES, THE TOURISM INDUSTRY IS EXPANDING RAPIDLY. NEW HOTELS
AND POSSIBLY A CASINO OR TWO ON THE ISLAND OF TINIAN WILL REQUIRE
EVEN MORE WORKERS WHICH WILL HAVE TO COME FROM OUTSIDE. WE
WELCOME THIS SIGN OF A HEALTHY GROWTH, BUT WE BELIEVE THERE NEEDS
TO BE SOME DIVERSmCATION INTO AREAS WHICH DO NOT REQUIRE INTENSIVE
LABOR INVESTMENTS. THE LOCATION OF THE COMMONWEALTH SHOULD BE AN
INCENTIVE TO AMERICAN COMPANIES DOING BUSINESS IN ASIA, FOR EXAMPLE.
LAW ENFORCEMENT
WE APPLAUD THE EFFORTS OF GOVERNOR TENORIO TO SECURE AN INCREASED
PRESENCE OF FEDERAL LAW ENFORCEMENT AGENCIES IN THE
COMMONWEALTH. THERE IS NO QUESTION BUT THAT THERE IS A REAL NEED
FOR SKILLED ASSISTANCE IN THIS AREA. WE HAVE, IN FACT, TAKEN THE
rNITIATrVE TO PROVIDE FORA FOR THESE AGENCIES TO EDUCATE THE PUBUC
ON THEIR RESPONSIBIUTIES. WE HAVE aLREaDY HAD A SEMINAR ON nSCAL
FRALID AND COUNTERFEITING WITH THE SECRET SERVICE AGENT BASED IN THE
REGION AND WE WILL CONTINUE DO DO SO.
I WILL NOTE THAT THE LOCAL DEPT. OF PUBLIC SAFETY IS FACED WITH A
HERCULEAN TASK GIVEN THE FACT THAT MUCH OF THE SERIOUS CRIMINAL
ACnVTTY IS CONCENTRATED WITHIN VARIOUS ETHNIC AND NATIONAL GROUPS
AND THAT THESE ARE VERY DIFHCULT TO PENETRATE. THERE HAS BEEN
PROGRESS, HOWEVER AND DPS IS TO BE CONGRATULATED.
I NOTE IN PASSING
THAT A SPECL^L LOCAUFEDERAL TASK FORCE HAS BEEN ESTABUSHED TO
GUARANTEE COOPERATIVE EFFORTS IN THIS AREA.
THE BUSINESS CLIMATE IS DIRECTLY AFFECTED BY THE SECURITY AND WELL-
BEING OF THE COMMUNITY. THIS HAS BEEN A FACTOR IN SOME POTENTIAL
247
nsfVESTORS DECIDING NOT TO COME TO THE COMMONWEALTH AFTER READING
THE HEADLINES FOLLOWING SOME PARTICULARLY NOTABLE CRIMINAL
ACTIVITY.
I CAN ASSURE THIS COMMITTEE THAT WE WILL CONTINUE TO
COOPERATE FULLY WITH FEDERAL LAW ENFORCEMENT AGENCIES.
FEDERAL/COMMONWEALTH RELATIONS
MR CHAIRMAN, I VENTURE INTO THE DELICATE AREA OF
FEDERAL/COMMONWEALTH RELATIONS WITH A CERTAIN TREPIDATION.
I DO
BELIEVE, HOWEVER, THAT IT IS IMPORTANT TO POINT OUT THAT WHILE WE DO
HAVE PROBLEMS OF LOCAL ORIGIN, THERE ARE OTHERS WHICH HAVE BEEN
CREATED THROUGH A MISINTERPRETATION OF THE COMMONWEALTH
COVENANT OR THE MISUNDERSTANDING OF COMMONWEALTH HISTORY.
I
WOULD LIKE TO POINT OUT TWO SPECIHC EXAMPLES WHERE FEDERAL
ACnVIES HAVE CONTRIBUTED OR ARE ABOUT TO CONTRIBUTE TO OUR
PROBLEMS IN THIS AREA.
THE FIRST RELATES TO A RECENT AUDIT OF THE DISPOSITION OF
COMMONWEALTH PUBUC LAND BY THE INSPECTOR GENERAL.
IT WAS STATED
IN THE MEDIA THAT THE AUTHORITY TO AUDIT THIS PURELY INTERNAL ISSUE
WAS BASED ON THE FACT THAT "THE PUBUC LAND IN THE COMMONWEALTH
HAD BEEN OWNED BY THE UNITED STATES" BEFORE IT WAS TURNED OVER TO
THE CNMI. IN FACT ALL TRUST TERRITORY PUBLIC LAND WAS RETURNED TO
THE TRUST TERRITORY DISTRICTS IN WHICH IT WAS LOCATED IN 1976,
BELIEVE. NO LAND IN THE TRUST TERRITORY WAS OWNED BY THE UNITED
STATES UNDER THE TRUSTEESHIP. WHILE I DO NOT .ALWAYS AGREE WITH OUR
GOOD GOVERNOR ON HOW THESE LANDS ARE HANDLED, I DO NOT, HOWEVER,
SEE ANY FEDERAL INTEREST IN THIS AREA.
IF THE MEDL\ REPORT WAS
ACCURATE, THIS KIND OF MISINTERPRETATION OF HISTORY HAS LARGER
^
248
IMPLICATIONS.
THE SECOND AREA OF GREAT CONCERN THE SATPAN BUSINESS COMMUNITY, MR
CHAIRMAN, IS THE APPARENT INTENT OF THE NATIONAL LABOR RELATIONS
BOARD TO APPLY ITS REGULATIONS IN THE CNMI WITHOUT CONSIDERATION OF
LOCAL LAW. IN PARTICULAR I HAVE RECENTLY BEEN INFORMED THAT THERE
IS A POLICY COMING DOWN THE PIPELINE WHICH WOULD PREVENT AN
EMPLOYER FROM NOT RENEWING AN EXPIRED NON-RESIDENT WORKER'S
CONTRACT TO BE REPLACED BY A LOCAL HIRE. IT HAS BEEN THE CNMI LAW
FOR YEARS NOW THAT ANY U.S. CITIZEN HAS PRIORITY OVER AN IMPORTED
WORKER.
AS IT WAS EXPLAINED TO ME
, UNDER THE NEW POUCY FROM THE
NLRB THE EMPLOYER WILL BE REQUIRED TO RENEW THE NON-RESIDENT
WORKER UNLESS THERE IS CAUSE FOR DISMISSAL, EVEN IF A LOCAL HIRE
INDIVIDUAL IS AVAILABLE AND APPLYING. THE NEGATIVE REPUTATION OF THE
COMMONWEALTH IN THE LABOR AREA NOTWITHSTANDING, THE FACT IS THAT
MANY GUEST WORKERS IN THE CNMI ARE VERY RELUCTA>rr TO RETURN TO
THEIR COUNTRIES ORIGIN. THIS IS, FOR EXAMPLE, THE MAIN REASON FOR THE
ESTIMATED THOUSANDS OF OVERSTAYERS IN THE ISLANDS AND LABOR ABUSE
CASES FILED JUST PRIOR TO THE EXPIRATION OF CONTRACTS. BUT TO TAKE
AWAY THE EMPLOYER'S RIGHT TO CHOOSE HIS EMPLOYEES AND TO FORCE HIM
TO GIVE PREFERENCE TO NON-US CITIZENS OVER US CITIZENS DOESN'T SEEM
RIGHT. AND IT GOES AGAINST THE LOCAL LAW GIVING U.S.CITIZENS PRIORITY.
IF, OF COURSE, THERE HAS BEEN SOME ABUSE OF THE CONTRACT WORKER
PROVEN, THEN THAT IS ANOTHER STORY.
MR CHAIRMAN, IN CONCLUSION LET ME STATE THAT THE SAIPAN CHAMBER OF
COMMERCE IS FULLY BEHIND THE MINIMUM WAGE ISSUE AS I DESCRIBED
ABOVE. LET ME REPEAT THAT IT CANNOT BE SERIOUSLY DISCUSSED WITHOUT
CONSIDERATION OF THE MANDATED BENEHTS. WE WELCOME FEDERAL LAW
249
E>fFORCEMENT AND THE TECHNICAL ASSISTANCE GIVEN TO OUR IMMIGRATION
AND LABOR OFHCIALS. WE ARE WORKING AT DIVERSIFICATION AND,
HOPEFULLY, THE AMERICANIZATION OF OUR ECONOMY.
I MIGHT NOTE IN
PASSING THAT WE HAVE HAD SOME VERY FRUITFUL DISCUSSIONS WITH
SEVERAL EUROPEAN AND ASIAN DIPLOMATS TOURING THE REGION AND HOPE
TO SEE SOME RESULTS IN THE FUTURE.
WE HOPE THAT THE CONGRESS AND THE ADMINISTRATION WILL CONTINUE TO
MONITOR OUR PROGRESS AND SET RESPONSIBLE GUIDELINES WHICH ARE
CONSISTENT WITH THE PRINCIPLES OF SELF GOVERNMENT AS EMBODIED IN
THE COVENANT AND THE CNMI CONSTITUTION. WE HAVE ALSO TAKEN THE
INmATTVE TO DISTRIBUTE THE INTERIOR REPORT ON THESE ISSUES TO OUR
BOARD MEMBERS. WHILE WE AGREE WITH A LARGE MAJORITY OF THE
OBSERVATIONS, WE BELIEVE THAT MORE CAN BE DONE BY WORKING
COOPERATIVELY THAN OTHERWISE. WE DO HAVE A LOT OF WORK TO DO, BUT
THERE HAS BEEN CONSIDERABLE PROGRESS AS WELL.
THA>JK YOU VERY MUCH, MR. CHAIRMAN.
250
Samxiel F. McPhetres
President and Chainnan of the
Saipan Chamber ofCommerce
P.O. Box 803
Saipan, MP 96950
Tel: (670) 233-7150
Fax:(670)233-7151
Business:
Samuel F. McPhetres, Consulting
P.O. Box 5324
Saipan, MP 96950
Tel: (670) 233-8666
Fax:(670)234-8381
Email: samueL£mcphetFes@salpan.com
Synopsis: Toe Saipan Chamber ofCommerce (SCC) supports the increase in
minimum wages as long as the mandated employee benefits are adjusted
accordingly.
The SCC
is concerned about the increasing non-resident population and the
concommittant social problems that have developed. The organization siqjports the
technical and logistical siqjport from federal agencies to local agencies but does not
support a federal take-over.
The SCC appreciates the presence of federal law enforcement agencies in the
Commonwealth and promises to continue the Ml cooperation of the business
community.
The SCC is not in &vor of any federal takeover ofminimum wage or immigration
but continues to urge cooperative efforts by the federal and Commonwealth
authorities to resolve problenas under the aegjs of the Covenant and the CNMI
Constitution.
Saipan Chamber of Commerce
251
^
FEDERAL
- CNMI INITIATIVE
ON
LABOR, IMMIGRATION, & LAW ENFORCEMENT
SECOND ANNUAL REPORT
June
1996
252
Table of Contents
Executive Summary
I.
Background
II.
Findings
A.
Areas of Progress
B.
Areas of Concern
Immigration
Minimum wage
Prison Facilities
Shadow Contracts and Letters of Invitation
Costs
III.
Recommendations
A.
Minimum Wage
B.
Prison
IV.
Initiative Agenda
A.
Immigration options
B.
CNMI-INS Coordination
C.
Shadow Contracts
D.
Non-payment of wages/costs
E.
Interior Inspector General
F.
Prostimtion
G.
Prison/Detention Facilities
H.
International Issues
Appendices:
Appendix A ~ Summary of Initiative Activities and Plans
Appendix B ~ Attached Agency Reports
Appendix C ~ Attached Census Data
Appendix D ~ CNMI Support for Minimum Wage Increase
253
EXECUTIVE SUMMARY
The combined efforts of the Government of the Commonwealth of the Northern Mariana Islands
(CNMI) and the Federal agencies are making progress
in
fulfilling the goals of the Federal-
CNMI Initiative on Labor, Immigration, and Law Enforcement.
Governor Tenorio has strongly
endorsed
the CNMI's actions and
the
increase of Federal
law enforcement presence.
The
Federal agencies and the CNMI are working
cooperatively, with the Office of Insular Affairs
acting
as
an ombudsman,
to
address
the problems
of responding
to
the consequences
of
enormous growth
in the CNMI.
However, sustained follow-through from both the local and
Federal governments
is needed
if Initiative goals are to be met.
The Federal agencies participating
in the Initiative recommend the following:
(1)
Recommend that the Congress finalize enactment of section 2 of S. 638 to establish
in Federal law the annual 30-cent increases in the minimum wage contained
in
existing CNMI law.
(2)
Recommend that the Congress direct the CNMI to utilize Covenant funds for prison
and detention facilities.
With regard to the imposition of immigration controls,
it should be noted that the Immigration
and Nationality Act (INA) may not entirely address the immigration problems in the CNMI.
Full
application of the INA could have unintended consequences
for
the CNMI.
Effective
immigration control may require legislation on immigration specific to the CNMI at either the
local or Federal
level.
Should the CNMI not establish more effective control of immigration
within a year, the Federal agencies participating in the Initiative will develop options to increase
the Federal
role
in local immigration as
is necessary to establish immigration control.
These
options
must
give
consideration
to
self-government
in
the CNMI
and
local
economic
development needs.
27-245 0-96-9
254
I. BACKGROUND
The Initiative was funded with a $7 million appropriation by the Congress in Public Law 103-
332 for fiscal years 1995 and 1996.
Of this amount, $4 million was allocated by the Department
of the Interior for Federal agency action and $3 million for CNMI action.
The latter included
$1.5 million for a computer system to track alien workers in the CNMI.
The Congress endorsed
the Initiative due to allegations of maltreatment of alien workers in the CNMI.
Such allegations
included the non-payment or late payment of wages, excessive work hours, poor working and
living conditions, involuntary servitude, forced prostitution,
rape, beatings, intimidation,
racial
discrimination, and other allegations of labor and civil rights violations by private employers,
recruiting agencies, and local officials under color of law.
Also of concern to the Congress was the effect that the large alien population increase has had
on the social, economic, and political
institutions of the CNMI.
This increase resulted from
large number of alien workers, from tourists, and from workers overstaying the periods of their
visas and work permits, and from the inability of local officials to track and deport overstaying
tourists and alien workers. The local immigration and labor systems have been characterized by
meritorious
and
frivolous
labor
complaints,
fraudulent
employment
credentials,
and
the
preferential hiring of low-paid alien workers over resident workers.
Finally,
this population
increase was associated with increased drug
trafficking,
white collar crime and government
corruption, a strain on local government services and infrastructure, and a concern about the
future political impact of children of alien workers bom in the CNMI who, by birth, are United
States citizens.
During the past year. Federal agencies have met on numerous occasions to coordinate planning
and action, both in Washington, D.C. and Saipan.
A field task force of federal agencies, co-
chaired by the Office of Insular Affairs Representative
in Saipan and the United States Attorney
for Guam and Saipan, has been formed
in Saipan and meets monthly to discuss progress and to
develop plans for the Initiative.
Members of the Federal interagency working group have also
traveled
to
the CNMI from Washington, D.C, from
regional
offices on
the mainland and
Honolulu, and from Guam where they have met with Federal
field officials.
Chairman Frank
Murkowski, Senator Daniel Akaka, and staff from the Senate committee on Energy and Natural
Resources traveled to the_GNMI in February 1996 to meet with Federal agency representatives,
local government officials, and the business community to gain first-hand knowledge about these
issues.
In April 1996, the CNMI government financed a visit by eight House staff members to
the CNMI.
II. FINDINGS
AREAS OF PROGRESS
CNMI Governor Froilan Tenorio has supported increased budgets and staffing for the
CNMI Attorney General's office, the CNMI Department of Labor and Immigration, and
work on the computer tracking system for alien workers
in order to improve local labor,
immigration, and law enforcement capabilities.
In addition, the Governor has called for
a
greater
Federal
law enforcement presence
in
the CNMI and
has supported
local
cooperation with Federal law enforcement agencies.
The Initiative has brought increased Federal resources and staff to the CNMI to enforce
Federal law.
Full-time Federal staffing in the CNMI increased by eight (six two-year
assignments, two temporary duty assignments).
Federal
agencies are
also providing
training to local agency personnel.
Caseloads for the Federal District Court,
the United
States Attorney, the Department of Labor, the National Labor Relations Board, and law
enforcement agencies have all risen dramatically.
Federal District Court:
For
the two
full calendar years of 1994 and
1995, there were 25 criminal cases on the U.S.
District Court docket in
the CNMI.
With
the
increased
law enforcement stemming from
the
Initiative, there have been 20 criminal cases brought in first three months
of 1996, a
four-fold increase.
United
States
Attorney:
In
the
fiscal
year
1995,
the
United
States
Attorney's
Office
filed
14
criminal
cases
against
19
defendants,
and
opened a total of 22 investigations.
In the first five months of fiscal year
1996, the Office has filed 12 criminal cases against 22 defendants and has
opened 21
investigations.
On the civil side,
in the
first five months of
fiscal year 1995, the Office filed or answered in ten cases and received
11
matters.
In
the
first
five months of
fiscal year
1996,
the Office has
answered or filed 3 civil cases and has received 15 matters.
U.S. Marshals Service Incarcerations:
For
the twelve-month period
ending March 31, 1995, the Marshals Service handled 14 incarcerations.
For the past year's
identical period, ending
in March
1996,
the figure
almost doubled to 25.
National Labor Relations Board: Approximately 60 unfair labor practice
charges and seven representation petitions have been filed with the NLRB
Honolulu Regional Office
in fiscal year 1995.
42 new cases are under,
investigation in fiscal year 1996.
256
Department of Labor:
In 1994, the Department of Labor's Wage and
Hour Division, operating from a one-person office in Guam, investigated
10 firms.
The collective bacic wage amount found due to employees was
$1,232,951.
During the period April 1995 through March 1996, with two
investigators
in Saipan,
21
firms were
investigated and found
to owe
employees over $1,693,000
in unpaid wages..
AREAS OF CONCERN
The CNMI Government has had difficulty in controlling immigration.
While progress
is being made in developing the necessary institutional capability, there
continues
to be
inadequate enforcement of immigration
laws and
regulations.
For
example, several moratoria on the importation of alien workers have come and gone,
with no impact.
Records on the number of alien worker permits are of
little help in
tracking alien workers because information is lacking on when or whether workers leave
the CNMI.
The prototype of the new computerized alien tracking system that would aid enforcement
is continuing to progress.
During prototype development to date, 23,010 alien records
have been entered
into
the database.
CNMI estimates that by July 1996 that the total
may reach 27,000.
This information
is being stored
in the database
to be used for
issuance of
alien worker
identification (ID) cards and to support queries
for ID and
status information.
The prototype became operational at the end of May 1996.
In parallel with implementation of the prototype
is the CNMI Project Team's planning
and development of the full operational Labor and Immigration support system.
That
development
is to be supported by the Department of the Interior (DOI) and by
the
Immigration and Naturalization Service (INS), in the form of Independent Validation and
Verification (IV&V) process.
Critical to initiation of development
is publication of a
comprehensive Project Plan, to be reviewed and accepted by
all parties.
That plan has
been expected since early April and, while INS and DOI have commented on a draft
plan,
there
is concern that the plan
is not yet complete.
Based
on CNMI
projected
completion,
it
is
expected
that
by
the
mid- 1997
the
computerized alien tracking system will be have progressed from prototype into a fully
implemented operational system, for labor and immigration status determination and for
entry and exit control purposes.
In the meanwhile, census data are the best means of
tracking the number of aliens present in the CNMI.
Preliminary
figures from
the 1995 CNMI census show
a toul population of 59,913
people, up 38 percent from 1990. Of these, the American-citizen population
is 27,512
(46 percent) and the alien population
is 32,401 (54 percent).
The percentage of the
257t
population bom in the CNMI stayed nearly constant at about 38 percent from 1990 to
1995, after decreasing from 72 percent in 1980.
The census data show
that the dramatic change
in ethnic composition of the CNMI
continues, both through immigration and through births
to aliens.
Most of the U.S.
citizens bom in the CNMI since 1990 have been bom to non-native mothers and for the
last few years, most have been bom to Asian mothers.
The population pyramid shows
concentrations
in the working-age group (twenty to forty), and
in children under five.
The
twenty-to-forty
concentration
is
a
result
of
immigration.
The
under-five
concentration
is made up of persons almost entirely bom in the CNMI.
Already
twenty-five
percent of the CNMI
school
population of 8,880
students
are
children of aliens. Virtually the entire increase
in these children of aliens has occurred
within the
last decade, with most of the increase
in the
last five years.
Based on the
under-five population, geometric increases
in this student population can be expected in
the next decade.
Little
is known about the numbers of illegal aliens in the CNMI.
Although most aliens
arrive legally, a number fail to leave after their contracts or tourist visas expire.
Since
good records are not kept on alien workers and the census does not identify illegal aliens,
only a rough guess exists.
The CNMI Central Statistics Division of the Department of
Commerce estimates the number illegal aliens in the CNMI to be approximately 2,300.
Federal sources believe that the number of illegal aliens could be substantially higher.
The
rate of actual deportations,
as opposed to ordered deportations,
is approximately
100-200 per year and
is almost certainly not keeping up with the rate of increase
in the
illegal population residing
in the CNMI.
The presence of
"temporary"
alien workers and their progeny have already altered the
composition of the population
in dramatic
ways.
It
is
ironic
that
local
control of
immigration was insisted upon by the CNMI Covenant negotiators
in order to prevent an
inundation by immigrants with a resulting loss of native Chamorro and Carolinian culture
and influence.
Yet,
local control has had exactly the opposite of the intended effect.
The reason
is simple enough:
instead of carrying
out a clear policy based on public
understanding and assent, the CNMI government has acquiesced to the desires of those
who can make the most profit from bringing
in alien workers.
The same interests have
been
able
to
prevent
the
government
from
charging
employers
the
full
cost
of
infirastructure and services needed by alien workers, and have impeded efforts to increase
the minimum wage.
CNMI Minimum Wage Policy is one of vacillation.
No
issue has become more contentious nor
is more misunderstood than the
issue of
raising the minimum wage in the CNMI.
The public and most business sectors realized
258
that a long-overdue gradual increase in the minimum wage to the level in effect on the
mainland and in most territories, including Guam, would stimulate the economy, increase
local
revenue,
and
provide
better
paying
private
sector job
opportunities
for
local
workers,
particularly the young, entry-level, wage earner.
As a result,
the legislature
passed and the previous Governor signed a law raising the minimum wage
in 30-cent
annual increments to reach the current mainland level by the year 2000.
However,
the CNMI Legislature
in mid-December 1995 voted a six-month delay
in
implementing the scheduled January
I,
1996, 30-cent increment
in the existing CNMI
minimum wage law.
Included in the legislation was the establishment of a Wage and
Salary Review Board,
chaired by
the personnel
director of a company
that owns a
number of
garment factories
that import several thousand alien workers.
The wage
board and the garment indusu^ have issued statements about marginal costs,
international
competition, and employment levels.
Economists opposing minimum wages have been
cited and requests been made for further study of wages and incomes to be based on
upcoming, but yet-to-be published census data.
The Governor's eleventh-hour veto of
the delay was over-ridden by the CNMI legislature just before the January
1 deadline.
Six weeks
later, the governor proposed reinstating the 30-cent minimum wage increase
on April
1,
1996.
The CNMI House of Representatives concurred, but the Senate did
not.
In April 19%, the Governor changed his mind and opposed the increase before July
1.
In May 1996, the CNMI Legislamre voted to roll the 30-cent increase back to
!5
cents for garment and construction workers,
leaving in place a one-time 30-cent increase
for
all other workers.
The
real consequence of
this new CNMI
legislation
is
the
elimination of all automatic annual minimum wage increases.
This voids the original
intent to systematically move the CNMI wage to the Federal level.
This vacillation on the CNMI's own minimum wage law occurs against the backdrop of
thriving and competing economies in Hawaii and Guam which for decades have paid the
United States minimum wage or more. A resolution of the Hawaii legislature,
in late
March,
strongly censured the CNMI on
its backsliding minimum wage policies.
All
three economies are heavily dependent on Japanese tourism.
The CNMI Chamber of
Commerce, Contractors Association, and Hotel Association have each formally expressed
support for the annual incremental increases in the minimum wage as was established in
CNMI public law 8-21.
They continue to argue that the increases are reasonable and that
the law provides needed long-term stability in wage policy.
While most CNMI businesses support an increase in the minimum wage, the policy
is
strongly influenced by the single industry that opposes
it - the garment industry.
Those
suggesting garment companies must compete with low wages in other Asian countries,
ignore the facts that they are exempt from United States duties and quotas, and that they
also compete directly with other United States businesses paying United States wages to
United States citizens and residents subject to United States immigration control.
259
The CNMI garment industry has portrayed
itself as a declining industry on the verge of
extinction
in the face of rising wage costs.
In
fact,
the CNMI has increased garment
shipments
in every year since
the
industry's inception
in 1984 and
is now expanding
production at an increasing
rate.
Garment imports from the CNMI increased
in value
from
$300.6 million in 1993 to $329 million in 1994 (up 9 percent),
to $425.9 million
in 1995 (up an additional 30.4 percent), and were up another 40.7 percent in the
first two
months of 1996 over
the same period
last year.
On top of this
increase,
the
local
administration has approved expansion of the industry with another
1 1 garment factory
licenses.
The
influence of the garment
industry
is
distorting CNMI
inunigration,
labor,
and
economic policy.
The clear need
is not for the industry to better compete, but for
it to
turn garment industry profits to the benefit of the entire CNMI community through better
wages paid to potential
local hires and greater contribution to the costs associated with
importing alien workers.
Enforcement of wage and hour laws
is thwarted by numerous companies
in the CNMI
that are thinly capitalized.
Some CNMI companies
hire foreign workers, short their pay
for as long as they can, and
if caught,
file for bankruptcy.
The foreign worker
is often
never fully paid.
Shadow contracts and letters of invitation are issues that need a solution.
The U.S. Department of Labor's Wage and Hour Division has resolved enforcement
cases and
obtained judgements against employers violating overtime laws.
A Wage
Hour Investigation found one firm with several garment manufacturing establishments
obtained kickbacks of back wages previously paid to employees. We also understand that
shadow contracts may exist under which alien minimum wage workers are required
to
pay kickbacks
to persons
in
their home countries from
their earnings
for
recruiting,
transportation costs and other fees.
Such shadow contracts would likely violate United
States labor laws
if they existed
in the United
States.
Direct enforcement,
in other
countries, against parties to such contracts
is extremely difficult.
The local government has issued numerous
letters of invitation to prospective investors
to conduct business in the CNMI.
These
letters are used to support applications for exit
visas in countries such as China.
Many recipients of such letters enter the CNMI with
limited business prospects and
little capital. We are concerned with recent news accounts
that attribute an increase
in organized crime to those who entered the CNMI on these
letters of
invitation.
While
the CNMI
asserts
that
the
issuance of these
letters has
ceased, there are reports that they continue to be available, and foreign nationals continue
to enter via these
letters.
260
7
Prison and detention facility construction must be a priority.
In appropriating funds for the Initiative, the Congress cited the need for adequate prison
and detention facilities as one of the goals of the Initiative.
While preliminary analysis
indicates a need for a 200-bed
facility, no firm steps have been taken by the CNMI to
meet this need. We believe
it
is time to move on the prison issue. We have written the
Governor, asking to work together to address this pressing need.
The importation of alien workers
is accompanied by significant societal cost.
Many activities of the CNMI and Federal governments are forced to address the presence
of alien workers in the CNMI: not all health care services for alien workers are covered
by
insurance;
police
and
court
services
for
alien
workers
go
unreimbursed;
and
electricity, water, and sewer costs are subsidized by the CNMI and Federal governments.
The CNMI's
continuing
need
for
capital
infrastructure
funding
(currently
being
subsidized by the Federal government at a rate of $11 million a year under Public Law
104-134)
is
partially
driven by
uncontrolled
immigration.
Without
the
large
alien
temporary worker population, the CNMI would need substantially less new capacity in
hospital, education, road, water, sewer and electric
facilities.
If their costs to the CNMI
government were fully covered,
it can be argued that the Federal taxpayer would not be
called upon to subsidize costs beyond existing appropriations that more appropriately
should be borne by employers (who benefit from cheap alien labor) and their customers.
In addition to the calculable dollar costs of services,
infrastructure, and wages noted
above, there
is a moral cost for a society where frauds are commonly perpetrated on
alien workers.
An effective bonding or escrow procedure should be mandated to protect
workers.
Furthermore,
there are also moral costs when the CNMI
is the venue where
alien women, some underage, are brought allegedly for purposes of "hostessing" but may
also be engaged in prostitution.
CNMI policies have consequences overseas.
By
actions on March 29 and May
12,
1995,
the
Philippine government
prohibited
Philippine
nationals
from
working
in
the CNMI
as
household
workers,
farmers,
waitresses/receptionists and other related workers
in bars and night clubs, and in jobs
employing non-professional women. During the intervening year, the CNMI government
worked to
lift the ban.
Finally,
in mid-May 1996, the Philippine government rescinded
the ban on Philippine workers in the CNMI.
261
III. RECOMMENDATIONS
Last year's report, dated April 24, 1995, contained five recommendations:
(1) confirm existing
CNMI minimum wage
increases
in
Federal
law,
(2) phase
out CNMI Covenant
financial
assistance, (3) reserve $3 million a year in CNMI Covenant funds for the Initiative, (4) require
an annual report on the
Initiative and coordination of immigration
issues by CNMI and the
Immigration and Naturalization Service, and (5) phase in full application of the Immigration and
Nationality Act in the CNMI
if alien workers exceed 1992 levels and law enforcement in the
CNMI remains deficient.
Recommendations (2) on financial assistance and (3) on Initiative funding were implemented with
the enactment of Public Law 104-134.
Recommendation (1) on minimum wage was passed by
the Senate in S. 638, but the House Committee on Resources has not yet acted on the measure.
In the coming year, recommendations (4) and (5) will receive further consideration and may be
revised by the Federal agencies participating in the Initiative.
The Federal-CNMI Initiative would be strengthened
if the Congress would take action on the
following
recommendations
by
the
participating
Federal
agencies
(except
National
Labor
Relations Board which, as an independent agency does not make recommendations).
Agency
participants in the Initiative can provide a legislative drafting service for these recommendations.
(1)
Recommend that the Congress finalize enactment of
section 2 of S. 638 to establish
the minimum wage in Federal law including the annual 30-cent increases in the
minimum wage contained in existing CNMI law.
Currently, the Federal minimum wage provisions of the Fair Labor
Standards
Act
do
not
apply
in
the CNMI.
Congressional
enactment
is necessary
to ensure workers
are paid
at
least
the
minimum wage and to provide predictable wage increases for a
stable
labor environment and economic growth
sought by
the
CNMI
Chamber
of
Commerce,
the
CNMI
Contractors'
Association, and
the CNMI Hotel
Association.
Increasing
the
minimum wage
will stimulate
the
local economy by
raising
the
purchasing power of workers and increasing government revenues
through
greater
tax
collections
from
workers.
Moreover,
increasing
the minimum wage
will
not
increase unemployment
among United
States
citizen
residents, who have jobs
that pay
above the projected minimum wage.
Minimum wage increases,
therefore, primarily affect alien workers.
Since the growth of the
alien labor force may be slowed by increasing the minimum wage,
there
will be
a
favorable
effect on
related problems
including
262
illegal employer labor actions, strain on infrastructure, organized
crime
and
illegal
drugs.
In our
view,
reducing
the
existing
incentives
to
hire
alien
workers
at
lower
wages
than
those
prevailing
for
local
workers
should
help
slow
uncontrolled
immigration and perhaps help prevent the need for greater Federal
control of immigration.
(2)
Recommend that the Congress direct the CNMI to utilize Covenant funds for prison
and detention facilities.
Several task force agencies suggest that as law enforcement in the
CNMI becomes more effective, current substandard
facilities must
be replaced by an up-to-date 200 bed
facility
that would house
local prisoners, immigration detainees, and Federal prisoners.
IV.
INITIATIVE AGENDA
During the next year, agencies participating in the Initiative will examine the following issues,
among others;
o
If immigration control by the CNMI does not become more effective, develop options
to increase the Federal role in local immigration as
is necessary to establish immigration
control.
These options must give consideration to self-government
in the CNMI and
local economic development needs.
Devise
a
plan
for
information
sharing and cooperation between
the CNMI and
the
Immigration and Naturalization Service (INS) including
identification, and
if necessary,
CNMI exclusion or deportation of persons who represent security or legal risks to the
CNMI or the United States.
Develop specific information during the next year as to the scope, nature, and frequency
of any requirement that alien workers sign shadow contracts that diminish the effective
minimum wage paid in the CNMI, and consider possible changes in CNMI and Federal
law.
Develop a means for addressing non-payment of wages to employees and unreimbursed
costs to the CNMI government.
o
The stationing of Department of the Interior (DOI) Office of Inspector General (OIG)
personnel
in the CNMI, contingent upon adequate funding for this purpose,
to provide
investigative support for the Initiative to an extent consistent with the OIG's authority
under the Inspector General Act of 1978, as amended.
263
Appendix A
SUMMARY OF ACTrVITIES AND PLANS
CNMI-FEDERAL JOINT EFFORTS
The Initiative
provides a framework for the CNMI government and Federal government to work
jointly on
labor,
immigration, and law enforcement
issues.
The
result
is intended
to be
a
synergy that increases the effectiveness of both.
There
is daily communication between local
and Federal administrative and law enforcement personnel.
Federal training of local personnel
is on-going on several fronts.
The Initiative provides funding and impetus for coordination of numerous facets of the Initiative
that are conducted by individual agencies
in the CNMI
and Federal govenunents under the
individual and distinct authorities accorded those agencies.
The following
is a outline of agency
action, both Federal and CNMI.
FEDERAL ACTIONS
Of the $7 million appropriation, $4 million has been allocated through reimbursable support
agreements to Federal agencies to enhance their ability to address labor, immigration, and law
enforcement
issues.
The reports of individual Federal agencies are attached with a synopsis
appearing here:
Department of Labor
The
initial agreement provided
$1.6
million
to
the Department of Labor (DOL)
to make
available
Federal
staff
to
expand
local
enforcement
resources
and
to
train CNMI
labor
enforcement, certification and immigration personnel in order to improve the local governments'
ability to enforce
its own labor and immigration laws.
o
The Wage and Hour
Division
has
established an
office
in Saipan
with two
senior
investigators.
These
investigators have
directed joint DOL/CNMI
investigations
in
industry sectors where high levels of noncompliance have been found
in the past.
In
addition,
the
Federal
staff have
prepared
and
presented
educational
and
training
workshops for specific employer groups as well as the general business community in
order
to promote
employers'
understanding
of
United
States
labor
laws
that
are
applicable in the CNMI.
These investigators have undertaken two major initiatives that
involved in close coordination with the CNMI labor department to
develop a training
plan
and
a
compliance
assessment
plan.
Wage
and Hour
conducted
twenty-one
investigations during
the period
April
1995 through March
1996,
with enforcement
actions resulting in the payment of
$1,693,771
in previously unpaid back wages to more
than 1,600 workers.
264
10
Investigate activities relating to transportation or coercion of women for prostitution.
Aid the CNMI in developing a plan for construction of correction and detention facilities.
Continue to seek international cooperation that complements Federal efforts in the CNMI
with regard to labor, immigration, and law enforcement policies.
265
Plans .
During the next 18 months,
the enforcement plan provides for an expansion of
on-going enforcement efforts
in the garment, construction,
hotel/restaurant/night club
and
the
security
industries,
and
the
reinvestigation of a sample of firms
previously
investigated to determine the current compliance status of these firms.
The education
component will focus on businesses that have no formal association or industry group
representation.
An outreach effort
will focus on efforts
to
insure
that new workers
understand
their
rights.
The
Division
will
continue
discussions
with
the CNMI
government regarding structural changes in the local labor laws.
The Department of Labor's Solicitor continued to work with the Wage and Hour Division
on a jointly developed enforcement strategy focusing on industries with poor compliance
records.
In
fiscal year
1995,
efforts were concentrated on the private security guard
industry.
Solicitor filed actions
in the U.S.
District Court against the largest security
companies in the CNMI.
Three different cases (two security and one garment) were filed
resulting in judgements totaling over $1,342,174 for back wages and liquidated damages
impacting
over 420
persons.
A
fourth
case
is
under
appeal.
Solicitor
has
also
successfully negotiated settlements for OSHA violations.
Solicitor's staff was a part of
a Federal delegation to meet with officials of the Philippine government to discuss labor
conditions in the CNMI.
Information was exchanged on how to improve the conditions
of nonresident alien workers and the enforcement of Federal law.
Plans
:
It
is anticipated that Labor's enforcement activity will generate additional Wage
and Hour and OSHA cases that will be
referred
to the Solicitor
in the next eighteen
months.
Solicitor will coordinate with Wage and Hour and OSHA regarding training of
CNMI staff and the community.
The Occupational
Safety and Health Administration (OSHA),
through
a cooperative
education program
at
the
Northern
Marianas
College,
has conducted
14
of
the
34
educational
seminars
and
workshops
planned
for employer
and employee
groups.
Participants numbered over 1,000, mostly from the garment and construction industries.
Plans .
In addition to completing the current training effort, OSHA plans during the next
year to increase the number of these strike force visits from two or three a year to four
to six a year. OSHA believes that team inspections rather than a resident inspector
is the
most
effective way
to
achieve
the
desired
result of compliance
with OSHA by
the
garment industry, labor camp owners, and construction operations.
Employment and Training Administration (Office of Labor Certification) has provided
technical assistance to the CNMI for review of the local labor certification system.
Plans: ConHnnpH assistance to local labor certification.
266
National Labor Relations Board
The
National Labor Relations Board (NLRB)
is charged
with providing an orderly
process for protecting and implementing the respective rights of employees, employers
and unions
in their relations with one another by
(1) determining and implementing,
through secret ballot elections, whether there shall be union representation and,
if so,
which union; and (2) providing remedies for unlawful acts called unfair labor practices.
During the past year, 60 unfair labor practices (affecting 1500-2000 workers) and seven
representation petitions have been filed with the NLRB. NLRB has been successful
in
reaching settlements in five cases involving back pay and reinstatement of employees.
As of March 1996, NLRB has a larger than anticipated number of CNMI cases.
At the
initial investigation stage there are 42 unfair labor practice charges involving various
employers employing over 1000 employees.
Plans .
The NLRB has sent an experienced attorney to the CNMI for three months from
April to July 1996 to investigate and handle legal assigiunents and to serve as a source
of information to people in the CNML
NLRB anticipates an increased presence would
also allow
for
training and enforcement
in
the CNMI regarding
the National Labor
Relations Act.
Department of Justice
The initial agreement provided $2.2 million to the Department of Justice to increase federal law
enforcement presence in the CNMI and to provide technical assistance to the CNMI to improve
their ability to enforce their local laws.
o
Immigration and Naturalization Service (INS)
has two responsibilities with the Initiative.
The
first
is the assigiunent of an experienced immigration investigator in May 1996 to
the CNMI
for two
years
to
assist immigration enforcement.
The second
involves
assisting the CNMI to develop
its computerized Labor and Immigration Identification and
Documentation System (LIIDS).
Plans
.
The INS investigator will assist the CNMI Immigration and Labor Department
in
implementing
effective
systems
and
business
processes.
INS
will
conduct
an
Independent Validation and Verification
(IV&V) process of the LIIDS as
it progresses
and make recommendations for optimal system effectiveness.
The United States Attorney
for Guam and the Northern Mariana Islands reported an
increased caseload
in the CNMI in 1995.
The number of cases for 1996
is running at
almost double the 1995 rate.
267
4
Plans .
The
United
States
Attorney
will
coordinate
and
follow-through
with
the
prosecution
of cases now
being
developed by
the
numerous
Federal
investigative
agencies.
The Drug Enforcement Administration (DEA) conducted a narcotics assessment in the
CNMI and has based
its plans on how to address the drug problem in the CNMI on that
assessment. DEA has conducted three training sessions with the officials of the CNMI
and has established an Ad-Hoc Task Force with the local government.
DEA has initiated
fifteen
investigations
and
has made
several
arrests
relating
to
the
sale
of
crystal
methamphetamine.
Since October 1995,
a senior special agent from the Guam DEA
office has been assigned to primary duty to deal with CNMI issues.
Plans . DEA believes that the training of local law enforcement officials will produce the
best overall result for drug enforcement
in the CNMI, and plans to focus
its efforts in
the training area.
The Criminal Section of the Civil Rights Division at Justice
is coordinating with FBI
agents stationed in the CNMI a review of allegations and information for application of
federal criminal civil rights statutes.
Plans
.
The Criminal Section of
Civil Rights has instituted a plan to review allegations
that may warrant
investigations.
In early summer, a senior attorney will travel to the
CNMI for an on-site evaluation.
The Federal Bureau of Investigations (FBI) has assigned an additional Special Agent in
Saipan for two years.
This assignment makes a total of three FBI agents stationed in the
CNMI, two already assigned prior to the Initiative.
The additional agent will focus on
investigations of civil rights violations, public corruption, and organized crime.
Plans.
The FBI has initiated liaison with various community support groups and local
law enforcement agencies to provide information and training concerning federal criminal
civil rights violations.
The FBI will continue
its relationship with the Criminal Section
of the Civil Rights Division and the U.S. Attorney's Office in the CNMI to coordinate
the review of allegations of federal criminal civil rights violations as well as violations
of other federal criminal statutes.
National
Institute
of Corrections
personnel
have conducted
training
in
correctional
management
for CNMI
law enforcement
officials.
The immediate
results were
the
development of five correctional policies and procedures and identification of the need
for a corrections action plan.
Plans .
With corrections and detention facilities in the CNMI woefully inadequate, new
corrections
facilities are recommended by
several
agencies.
The Administration has
268
communicated
its concerns
to the Governor and
intends
to work with
the CNMI
to
address this need.
The United States Marshals Service projects that the enhanced Federal investigatory and
prosecutorial initiative will increase the requirement to provide valuable support services
on behalf of and to the Federal Judicial District of the CNMI.
An additional, full-time
Deputy U.S. Marshal was permanently assigned on October
1,
1995, augmenting the
Marshals
Service's
capabilities by
100%.
This
strategic
decision proved
to
be
a
fortuitous one as incarcerations rose 245%
in the first quarter of fiscal year 1996.
Plans.
In addition to ensuring that adequate Marshals Service personnel staffing levels
be maintained to meet the anticipated and steadily increasing workload requirements, the
Marshals Service
is in the process of finalizing a Partnership Agreement between their
office, the CNMI Department of Safety, and the Guam Department of Corrections.
The
purpose of the Partnership between the key providers of detention service in this region
will
be
"to
share
and
align
the
Partners'
resources
to
the mumal
benefit
of
the
participating
regional
detention
service
professionals."
A pending
"
First
Act
of
Partnership" will be the temporary housing of CNMI's Federal pre-sentenced detainees
in the Department of Correction's detention facility on Guam.
The Marshals Service
is
pursuing the implementation of a videoconferencing capability between Guam and Saipan
to support this temporary accommodation.
An anticipated "Second Act of Partnership"
will
involve the creation of shared
training and employee development opportunities
between the participating detention service professionals.
Child Exploitation and Obscenity Section (CEOS) of the Criminal Division is interested
in working on prosecutions of individuals who transport, or conspire to transport, young
women to the CNMI for purposes of criminal sexual activity, including, but not limited
to, prostitution. CEOS
is also interested in the prosecution of individuals who travel to
the CNMI
to
engage
in
criminal
sexual
activity,
including,
but
not
limited
to,
prostitution.
As a preliminary step to undertaking prosecutions, CEOS has conducted
telephone interviews with federal government personnel
in both the CNMI and Guam,
many of whom provided information regarding the transportation of women and travel
to meet these women in violation of the Mann Act.
Plans .
CEOS expects to complete the preliminary phases of this project shortly.
At that
time, CEOS
will develop a strategy
to
initiate investigations leading to prosecution of
individuals organizing these criminal activities.
Department of Treasury
The
initial agreement provided $200,000 to the Department of Treasury for improving CNMI
law enforcement.
269
The Bureau of Alcohol, Tobacco, and Firearms has provided assistance to the CNMI
over the last year which has resulted
in several cases targeting armed career criminals,
numerous armed drug traffickers, and a case which
is attempting to determine the source
of illegal explosives.
ATF made arrests for explosives and firearms, and prosecutions
have involved charges under the career criminal
statute.
Plans
.
Cooperative enforcement efforts with an emphasis on training for CNMI law
enforcement
officers
will
be
a
priority.
Training
will
include
firearms
trafficking
investigative
techniques,
interviewing
and
interrogation
techniques,
arson-for-profit
investigations, undercover techniques, and operational security techniques.
The United States Secret Service has participated in major investigations culminating in
arrests,
including bank
fraud,
justice
obstruction,
mail
theft and
drug
distribution.
Several cases have been investigated including counterfeit currency,
credit card fraud,
theft and forgery of US Treasury checks.
Secret Service rotates an agent through Saipan
for two weeks out of every two-month period.
Plans .
To continue participation in Task Force efforts and to support the Federal-CNMI
labor. Immigration and Law Enforcement Initiative to the extent possible.
The United States Customs Service has stationed several
rotating special agents
in the
CNMI
to work with CNMI customs and
public
safety
personnel
with
the
primary
objectives of
investigating
illicit drug
trafficking,
illegal arms
export,
violations
of
currency controls, money laundering,
illegal transhipment of textiles, and other CNMI
and Federal law violations.
Ten investigations in the
last six months, have resulted
in
five
arrests and
the seizure of counterfeit currency,
unregistered
firearms, and drug
paraphernalia. Two training sessions have focused on safety and mental preparation for
armed confrontation, inspections at airports and seaports, and canine operations.
The
U.S.
Customs
Service
has
established
a
U.S.
Treasury
Task
force
in
the CNMI
consisting of one or two US Customs
Special agents and
officers from
the CNMI
Department of Public Safety and the CNMI Customs.
Plans .
U.S. Customs Service plans to continue the task force and
is prepared to support
the
initiative with temporary
details.
It
is believed
that more work can be done
to
enhance the enforcement efforts
in the labor area by concentrating on investigations of
the garment industry and the transshipment of textile products through the CNMI.
Department of the Interior
The Department of the Interior Inspector General has expanded
its investigation of public
corruption
in the CNMI as
its contribution to the
Initiative.
A senior agent from the
OIG's Guam field office
is assigned to the Initiative and frequently travels to the CNMI
270
in furtherance of investigations.
This agent has extensive experience conducting public
corruption investigations
in the territories.
Currently,
the Interior Office of Inspector
General has five investigations that have been initiated as a result of Initiative efforts to
ferret out public corruption
in the CNMI.
Plans .
If
it
is recommended that the Inspector General establish a physical presence in
the CNMI for Initiative purposes, funding will be necessary.
CNMI ACTIONS
Of the $7
million appropriation,
$3
million was granted by
the Office of Insular
Affairs,
Department of the Interior to the CNMI for local action.
$1.5 million of the $3 million of federal assistance was provided
to establish
a computerized
labor and immigration identification system.
The CNMI accepted the grant on December 31,
1995.
Labor and Immigration Identification and Documentation System
Amount authorized: $1,500,000
The Labor and Immigration Identification and Documentation System (LIIDS)
is an ambitious
undertaking of the CNMI government to develop a computer system to track and to manage the
entry and
exit of tourists and
to control
the
influx of alien laborers
required by
the CNMI
economy.
The
system
will
improve
and
automate
the
method
of
reviewing
labor
and
immigration documentation for issuance of permits and identification cards, better serving the
government and the private sector.
The CNMI
is working
closely
with
the INS on developing
the
system.
The CNMI
has
developed a prototype system and data base
that
is currently operational.
It has included
all
labor permitting actions taken since July 1995.
By June 1996, the LIIDS program
is scheduled
to have a prototype system that (1) will be able to log individual foreign worker identity, and
labor and immigration data,
(2) build a standard data base for this information,
(3) issue entry
permits
that
verify an
individual's
initial entry
stams, and
(4)
issue
identity cards
for each
foreign worker.
The LIIDS
will be used beginning
in
late May
1996
to
issue
alien labor
identity cards to all workers whose data has been entered
in the LIIDS data base since
it went
on-line.
This model has helped the CNMI define
its existing formal and informal processes of managing
labor and immigration services, and has already
led to improved management practices.
The
model
is now being used to better define the user requirements and functionality of the ultimate
system.
271
The CNMI has recently increased
its Labor and Immigration professional staff to complete and
maintain the LIIDS.
It has added an information systems manager,
a
logistics and training
engineer and a systems technician, and will soon hire a software engineer.
The next step in the
LIIDS development will focus on airport arrivals and departures for passport and tourist visa
control. While early contractual and staffing interruptions caused delays, INS, CNMI, and OIA
believe that the project
is now progressing at a satisfactory pace. The CNMI expects the project
to be completed in 18 months.
Full implementation will require
additional attention from those involved
in the
Initiative
to
develop robust operational support for management control of all alien workers and arrival and
departures of international travelers.
Local Project
The remaining $1.5 million federal assistance to the CNMI was granted to carry out mutually
agreed projects to address problems related to immigration and alien labor.
It was accepted by
the CNMI government on December
12,
1994.
The
first
project plans were submitted
in
January 1995.
Ten CNMI projects are currently operational.
Labor Code Revision
J,
Amount authorized:
$83,000
The CNMI's labor code was inherited from the Trust Territory government and has been revised
slightly
since the establishment of the Commonwealth.
Existing law
reflects a time and an
economy
in which alien labor played a small role.
The CNMI
in June
1995 contracted with an attorney
to review existing law and draft new
legislation better
reflecting
the current needs of the CNMI.
The contract also requires
the
submission of draft regulations to implement the legislation. The CNMI legislature will enact
or reject the code revision as
it sees
fit.
The project
is scheduled to be completed in June 1996.
Administrative Judge- Labor
Amount authorized:
$108,000
Although the CNMI has not yet requested reimbursement for this project,
the Administrative
Judge has been hired and
is functioning.
The CNMI reports that the backlog of pending labor
cases
is rapidly being reduced.
Assistant Attorney General/Labor
, p.:
.,,
-
272
Amount authorized:
$77,000
The CNMI has not reported on this project.
Criminal Code Revision
Amount authorized:
$117,000
The Commonwealth criminal code
is an amalgam of the Trust Territory Code, the Model Penal
Code and provisions from various state jurisdictions.
It
is said to be typical of a criminal code
of twenty years ago.
The project goal
is the revision and expansion of the code to reflect the
needs of the CNMI within the American jurisprudence system.
The project was initiated
in June
1995 and should be completed in 1996.
The CNMI legislature retains the right to enact or reject
the revision.
Rota Attorney General
Amount authorized:
$77,000
Funds were requested to allow the Attorney General to maintain a full-time Assistant Attorney
General
in Rota.
The new official has been hired and
is now in residence on Rota.
Criminal Attorneys
Amount authorized:
$230,006
This project was requested
in response
to the
large caseload of criminal prosecutions
in the
Criminal Division of the Commonwealth.
Two prosecuting attorney positions have been filled.
Informant Payment Fund
Amount authorized:
$20,000
The funds were requested to allow the Department of Public Safety a source of payment for
confidential information.
The Department
is using Justice Department administrative guidelines
for use of the fiinds.
Deportation Fund
Amount authorized:
$30,000
The
funds were approved
in November
1995
to
allow
the CNMI
a
source
of
funds
for
deportation.
No funds have been requested to date.
273
K
10
\
\
Investigative Unit
Amount authorized:
$375,000
\
The CNMI
requested
these funds
to address
its need
for
special
investigative expertise
not
available within
its traditional law enforcement service.
The open nature of the CNMI economy,
coupled with a heavy influx of visitors and alien workers has made the CNMI a potential target
of
international
criminals and
increased
oppormnities
for
official
corruption.
The CNMI
Attorney General's Investigative Unit has been augmented with additional funding and staffing
and offices in Tinian and Saipan.
The investigative unit
is under the confidential control of the CNMI Attorney General.
Its focus
is on white collar crime, official corruption, alien smuggling and organized crime.
The unit has
been functioning since the summer of 1995.
Protective Services
Amount authorized:
$75,000
The
Protective
Services
program
has
been
subgranted
to
Karidat,
a
non-governmental
organization providing social services in the CNMI.
Karidat provides outreach to alien workers
who may be in need of special assistance due to disagreements with or abuse by their employers.
A
full-time and a part-time caseworker are available
to provide advocacy services for alien
workers
in the CNMI.
Karidat
is able to provide short term shelter and assistance to alien
laborers as the need arises.
274
Appendix B
Federal Agency Reports
275
U.S. Department of Labor
Wage and Hour
Solicitor's Office
Occupational Safety and Health Administration
Employment Training Administration
276
U.S.
Department
of Labor Activity
in
the CNMI
In
1995,
the Department
of Labor
(DOL)
entered into
a
reimbursable agreement with the Department
of
Interior which
provides
for reimbursement
for specified DOL enforcement,
training and support
for
the Commonwealth of
the Northern Mariana
Islands
(CNMI)
.
The reimbursable
funding
is being used
for
training and enforcement
support
to the CNMI government
to make
meaningful and lasting improvements
in the labor and immigration
problems associated with the
large number of nonresident workers
being brought
to
the
islands
to work
in
a variety of
low-wage
industries.
The vast majority of
these workers
are
from
the
Philippines,
however China,
Korea,
and Bangladesh are also
supplying workers
in
the CNMI
The DOL agencies
involved
in these
labor standards enforcement,
training and support activities are
the Wage and Hour Division,
the Occupational Safety and Health Administration,
the
Solicitor's Office,
and
the
foreign labor certification
activities within of
the Employment and Training Administration.
The
initial agreement provided Labor with
$1.6 million over
two
years
to make available
Federal enforcement
and support
staff
to
train CNMI
labor enforcement,
certification and immigration
personnel
in order
to
improve
the
local governments'
ability
to
enforce
its own labor and immigration
laws.
This agreement
has
allowed
the Wage and Hour Division
to station additional
investigators
in the
islands
to direct
joint DOL/CNMI
investigations
at
industry sectors where high levels of
noncompliance have been found
in the past.
In addition the
Federal
staff have prepared and presented educational and
training workshops
for specific employer groups
as well
as
the
general business community
in order to ensure
that employers
understand what
is required under the
U.
S.
labor laws applicable
in
the
CNMI.
Wage Hour Division
In April
1995,
two Wage Hour investigators established an office
in the CNMI
to supplement
the enforcement support previously
provided by the senior Wage Hour investigator stationed in Guam.
After meeting with and developing points of contact with
the CNMI
government,
the Wage Hour staff undertook
two major initiatives
that
involved working
in close coordination with CNMI
labor
department managers and staff.
The
first
initiative involved the development
of
a training plan
for all
CNMI managers and staff
involved
in labor law
enforcement.
This training utilized the Division's Basic
Investigator training material
tailored
to
the
local
CNMI
situation.
The training was designed
to include an emphasis on
277
specific administrative and technical subject matter including
interviewing
techniqpies,
narrative report writing and case file
preparation.
Over
a
four month period
in
1995,
the customized
basic investigator training course was provided to all CNMI
labor
department enforcement staff.
During the presentation of the
basic training classes and continuing after the completion of the
formal classroom training,
joint investigations were conducted
with the CNMI labor department staff
in order to provide on-the-
job training experiences utilizing the skills learned
in the
training classes.
The second
initiative involved the development by Wage Hour staff
of
a compliance assessment plan to establish baseline compliance
levels
in various low-wage industries which employ the vast
majority of the nonresident alien workers employed
in the CNMI.
As
a result of this assessment.
Wage and Hour focused enforcement
efforts
in the garment,
security,
building maintenance and hotel
and restaurant industries
in
1995.
During the past year,
educational outreach seminars were presented by the Wage Hour
staff
for two
industry associations that together employ
a large
percentage of the nonresident alien workers on the island — the
Saipan Garment Manufacturers Association and the Hotel
Association of the Northern Mariana
Islands.
Large numbers of
nonresident workers
in the garment industry are from China and
the Philippines while virtually all
of the workers
in the hotel
industry are from the Philippines.
Since the majority of nonresident workers
in the CNMI are
from
the Philippines,
the U.S.
Embassy
in Manila suggested
a meeting
between U.S.
government officials and officials of the Philippine
government to discuss how to improve the current labor conditions
for Philippine contract workers
in the CNMI.
In June
1995,
a
delegation representing the Department's Wage and Hour Division
and Solicitor's office and the U.S.
Attorney for Guam and the
CNMI traveled to Manila and met with the Philippine Secretary of
Labor,
the Chief of the National Investigative Service
(Philippine
FBI)
,
the President's Special Representative
for
Overseas Contract Workers as well
as the U.S.
Ambassador to the
Philippines.
The delegation discussed labor conditions
in the
CNMI
including the recruiting practices
for obtaining contract
workers
in the Philippines and the living conditions and wage
payment arrangements of the contract workers brought to work in
the CNMI.
The discussions focused on the responsibilities of the
various
federal agencies
in enforcing labor laws
in the CNMI
as
well
as actions that can be taken by both Governments to improve
the conditions faced by overseas contract workers
in the CNMI.
278
The Philippine government representatives pledged support to the
U.S.
officials to assist the U.S.
Departments of Labor and
Justice
in enforcing
federal
laws
in the CNMI by identifying and
prosecuting offending employers and recruiters
in the Philippines
as well
as to help locate
former employees
for the purpose of
both obtaining information and
for distributing back wage checks.
During the past year,
the Wage Hour investigators stationed
in
the CNMI conducted
20 investigations
in the garment,
security,
building services and the hotel/restaurant/night club industries.
These enforcement actions resulted
in the finding of over
$1,288,000
in unpaid back wages due to over 1,600 workers.
For the remainder of FY
1996 and
into FY
1997,
the enforcement
plan provides
for an expansion of the on-going directed
enforcement efforts
in the garment,
construction,
hotel/restaurant/night club
(both large and small
firms)
and the
security industries.
As
a part of these investigations
information will be gathered as to the compliance ripple-effect
that prior investigations
in
a particular industry sector have
had on businesses not previously investigated.
In addition,
over
the next
18 months the Division will reinvestigate
a sample
of
the
firms previously investigated to determine the current
compliance status
of these
firms.
The results of these analyses
and reinvestigations will allow the Division to better plan
for
future enforcement initiatives including the more frequent use of
consent decrees,
injunctions and litigation.
For the next
18 months the education and outreach component of
the compliance plan will
focus on businesses that have no formal
association or industry group representation.
The Chamber of
Commerce will be contacted and asked to facilitate the scheduling
of educational outreach meetings with
firms
in the security
industry as well as retailers and the smaller hotels,
bars and
restaurants not currently members of the Hotel Association.
Another outreach effort planned
for the next year will
focus on
ensuring that new workers brought to the CNMI understand their
rights under the Federal
labor statutes that apply
in the
Commonwealth.
Departmental
staff
from the Wage Hour Division,
OSHA and the Solicitor's office will develop and distribute
comprehensive and easily understood literature concerning
employee rights and employer responsibilities under applicable
Federal
labor
laws.
279
This information will be made available through the local Wage
Hour office,
the Philippine Consulate,
the Philippine Overseas
Employment Office,
Karidot
(Catholic Relief Organization
in the
CNMI)
,
the CNMI Chamber of Commerce as well
as various offices of
the CNMI Departments of Labor and Commerce.
During the next year,
the Division will continue discussions with
local officials regarding structural changes
in the CNMI labor
laws that would help provide greater protections
in ensuring
proper and timely wage payments for employees not covered by the
Federal
labor
laws.
Most of these workers are nonresident aliens
employed as farmworkers,
maids and as employees of small
businesses
in the CNMI.
The total
FY
1997 costs
for maintaining two Wage Hour
investigators
in the CNMI,
continued additional enforcement
support from the senior Wage Hour investigator stationed
in Guam
and the conduct of two to three multiagency
(WH and OSHA)
task
force concentrated enforcement efforts
in one or two selected
industries
is estimated to be $325,200.
Finally,
the Administration's position on applying the Federal
minimum wage to the CNMI was articulated
in the previous report
to the Congress
in April
1995.
In that report the Department
proposed that the most expedient,
fairest and least disruptive
approach to applying the minimum wage provisions of the FLSA to
the Commonwealth would be to incorporate
into the FLSA the
current Commonwealth minimum wage
law,
including
its
$.3
an hour annual increases until the mainland minimum wage
level
is achieved.
The CNMI government and the Legislature had agreed on the current
CNMI
law after lengthy discussion,
debate and input from the
business community
in the Commonwealth.
This approach would
establish phased minimum wage increases under Federal
law and
thereby eliminate the possibility of future local action to
either further postpone or eliminate this gradual
increase
in the
minimum wage
for workers
in the islands.
In addition,
it would
allow Federal enforcement of the minimum wage,
thereby enhancing
enforcement resources available.
It
is quite clear that the labor problems
in the CNMI cannot be
resolved without
a sustained long-term commitment by the Governor
and the Legislature to change and improve the conditions that
have given rise to these problems.
While the Governor,
in the
past,
has been supportive of increasing the minimum wage,
there
are others
in the Commonwealth who benefit from maintaining the
status quo and will continue to resist increases
in the minimum
wage and other reforms to improve the living and working
conditions of these nonresident alien workers.
280
It
is unfortunate that during the past year the Legislature was
successful
in passing legislation,
and then overriding the
Governor's veto of the bill,
which temporarily stopped the
scheduled $.30 per hour
CbfMI minimum wage rate increase
(from
$2.75 to
$3.05 per hour)
set to go
into effect on January
1,
1996.
This legislation postponed the scheduled increase to July
1,
1996.
During
a February visit to the Commonwealth by Senators Frank
Murkowski and Daniel Akaka,
the Governor assured the Senators
that he would submit proposed legislation which would have
reinstated the
$.30 per hour minimum wage increase effective
April
1,
1996.
The CNMI House approved the April
1st minimum
wage
increase,
however the Senate proposed an April
15th increase
with an exemption
for small businesses.
In mid-April the House
rejected the Senate version of the minimum wage increase because
of the change that exempted small businesses.
In
a press
conference on April
19th,
Governor Tenorio indicated he now
supports the postponement of
a minimum wage increase until July
1,
1996,
while
a wage specialist from the U.S.
mainland conducts
a study on the
issues and how increasing the minimum wage will
affect the Commonwealth.
Thus the current CNMI minimum wage
remains at $2.75 an hour,
as
it has been since January
1,
1995.
Federalizing the minimum wage
in the CNMI will ensure that the
wage rate increases enacted by the government and Legislature
three years ago will go into effect as
intended thus providing
for gradual and predictable increases
in the minimum wage rate
which
is paid to virtually all the nonresident workers who are
employed
in the low-wage labor-intensive industries
in the
Commonwealth.
281
Solicitor's Office Activities
Wage and Hour Actions
The Department's Solicitor's
(SOL)
and Wage and our Division
(WH)
continued with
the jointly developed enforcement
strategy-
focusing on industries with poor compliance
records.
In FY
1995,
SOL and WH concentrated their efforts on the private security
guard
industry.
After WH investigations revealed serious FLSA
violations,
SOL filed actions
in the
U.S.
District
Court
against
the
largest security companies
in
the
CNMI
An action seeking preliminary and permanent
injunctions,
back
wage and liquidated damages was
filed
in Reich
v.
Antonio Aldan
Reyes dba Business Protection Service
,
for monetary violations of
the
Fair Labor Standards Act
(FLSA)
.
Defendant Reyes,
then CNMI
Chief
of
Police,
agreed
to the injunctions and back wages
and
liquidated damages totaling $692,569.
A similar action,
Reich
v.
Famco Security Services,
et
al
.
was
filed against
a private security guard company and
its
proprietors.
One of
the defendants
is
the Minority Leader
in the
Northern Marianas House of Representatives.
The complaint
alleged
the
firm willfully and repeatedly violated
the overtime
provisions
of
the FLSA by failing
to meet
their payroll
on
numerous occasions and by failing
to pay
the mandated overtime
premium on those occasions when wages were paid.
After agreeing
to
a preliminary injunction,
all defendants subsequently
defaulted.
A judgment was entered awarding
44 employees
$513,416
in back wages and liquidated damages.
The defendants have
subsequently filed
for
a discharge
of
their debts
in Bankruptcy
Court
Finally,
in Reich
v.
Saipan Manufacturers.
Inc.,
et
al
.
SOL
filed an action against
this Saipan-based garment
factory and
its
parent corporation
for overtime violations related
to defendants'
practice
of deducting the costs
of placement
fees and airline
transportation.
In
a consent
judgment,
the court awarded
$136,189
in back wages
to
376 alien workers
for violating
the
overtime provisions
of
the
FLSA.
This
is
the
first
time
a
Saipan-based corporation agreed,
in writing,
to language
prohibiting
a company from taking payroll deductions,
directly or
indirectly,
to recoup costs associated with recruitment and/or
transportation of workers
to
the
CNMI.
Such recruitment-related
payroll deductions are
a widespread practice since
a substantial
portion of
the CNMI workforce consists
of nonresident alien
workers
282
SOL filed
a cross-appeal
of
a partially adverse decision
in Reich
V.
Japan Enterprises
Corp..
et
al.
.
involving Filipina nightclub
"waitresses"
employed by Japanese club owners on the
island of
Saipan.
The employees worked
a 42-hour,
seven-night week and
were confined to fenced-in quarters during their non-work hours.
The Department
of Labor alleged,
and
the
court
agreed,
that
the
employees were not properly paid
for all hours worked,
including
the
time
in confinement.
In addition,
the Department alleged
that
improper deductions were taken from the employees'
wages.
The court awarded back pay to the employees
in the amount
of
$410,497.
Additional damages
are sought on appeal.
OSHA Actions
On
the
eve
of
trial,
SOL successfully negotiated settlements
involving employers
in Rota and Saipan.
The resulting Settlement
Agreements and Orders affirmed
119 citations against
4 employers
and collected $147,715
in penalties.
Included among these
employers was Willie Tan's L&T Companies which agreed
to withdraw
its contest
to
53
citations and pay $60,475
in penalties.
Additionally,
SOL initiated collection actions
in U.S.
District
Court against
two
firms
for the failure
to pay OSHA penalties
which had become
final.
The
two firms agreed to pay $50,000 and
$20,000 respectively,
on installment
terms with interest.
Other Activity
In June
1995,
SOL staff was part
of
a Federal delegation who met
with officials of
the Philippine government
to discuss
labor
conditions experienced by their nationals
in the
CNMI
Information was exchanged and ideas were discussed on how
to
improve
the conditions
of nonresident alien workers
in
the
CNMI
and the enforcement
of
Federal
law.
SOL staff traveled to China
to oversee
the distribution of
$4.6
million
in back wages owed
to Chinese workers which was recovered
from American International Knitters Corporation,
a garment
factory operated by Willie Tan.
In addition,
the Corporation had
pleaded guilty to criminal charges related to filing of
false
documents with the U.S.
Government
in relation
to wage kick-
backs.
The
final
installment on the
judgment
is due October
1,
1996.
Additionally,
SOL worked closely with
the
U.S.
Attorneys
for Guam
and the CNMI
as well
as other
law enforcement agencies
for
the
purpose
of
improving U.S.
Labor's enforcement
of
federal
labor
laws
in the Commonwealth.
Communications with
the CNMI Attorney
General
have been streamlined so as
to allow quick and easy
retrieval
of
information on the status
of businesses and
the
identification of proprietors,
directors,
shareholders and
corporate officials.
283
Anticipated Activities
SOL attorneys have been
in regular contact with the Wage and Hour
Director of Enforcement
in the
Pacific offering informal
assistance with respect
to ongoing investigations.
Where Wage
Hour
is not able to obtain back wages and future compliance on
a
voluntary basis,
or where
a court order
is considered necessary
because
of
the employer's history or
the nature
of
the
violations,
SOL will consider filing hot goods,
preliminary and
permanent
injunctions,
seeking back wages,
liquidated damages,
and other relief
as appropriate.
It
is anticipated that enforcement activity will pick up and that
additional
cases will
be referred to SOL
in
the next eighteen
months.
Additional cases
are also anticipated under OSHA as
a
result
of significantly greater enforcement activity
in the CNMI
As
a result
of
the greatly enhanced investigation activity to be
conducted by OSHA,
an additional
$95,000
is being requested
in FY
1997.
SOL will coordinate with Wage -Hour and OSHA regarding training of
CNMI
staff
and
the regulated community.
284
OCCUPATIONAL SAFETY & HEALTH ADMINISTRATION
PROGRAM ACTIVITIES IN CNMI
July 1995 ' March 1996
As a part of the 1995 Congressional/DOl Federal-CNMI Labor, Immigation and Law
Enforcement initiative, DOL/OSHA received $400,000 for a two-year training and
edu:;ation program intended to familiarize local employers and employees on their
rights and responsibilities as regards the OSH Act.
Of the $400,000, S288.000 was
granted for the Northern Marianas College (NMC) for the development and
administration of the training and education effort. The balance, $112,000, was
intended to fund an additional FTE for OSHA for the purpose of providing technical
assistance and monitoring of this program.
The training and education program by NMC was compressed into 18 months and was
initiated in July 1995. The program includes 34 training and education seminars and
workshops for employer/employee groups regarding rights and responsibilities under
OSHA, inspection procedures, appeals process, and occupational safety and health
regulations.
The target industries for these seminars were garment manufacturing,
construction, and labor camps related to the first two industries.
Seminars and workshops were to be conducted in Saipan, Rota and
Tinian.
The first three months of the program were dedicated to organizing staff, developing
curricula, and
tfaining
of trainers by OSHA.
The initial seminar and related workshops were held in Saipan in September. The
seminar highlighted the basic requirements of OSHA in the targeted industries. Two
hundred twenty-one attended this session.
Interpreter services translated
presentations into Chinese and Tagalog for the benefit of the audience.
Ninety percent
of the attendees represented were from the targeted industries and 90% indicated their
companies provided temporary housing to employees.
To date, 14 seminars have been held with 1,023 people attending, for an average
seminar attendance of 73.
Ninety-seven percent of the attendees are from either
construction or garment manufacturing companies.
Thu:-; far. NMC has drawn down approximately $120,000 of their $288,000.
There are
20 seminars
still planned before the expiration of OSHA's agreement. NMC has
$1 68,000 in funds remaining to cover the costs of these efforts.
28^
10
Although OSHA was unable to acquire an extra full time position dedicated to technical
assistance for the NMC,
it has expended four on-site visits and approximately 50
percent of an existing FTE to assist on the program.
This leaves approximately
$70,000 yet to be spent by OSHA on this effort.
We at OSHA are pleased with the training and education program administered by
NMC.
Voluntary compliance is a key aspect of the OSH Act and training and education
is the cornerstone to voluntary compliance. The seminars that we have observed are
of good quality and are serving to accomplish our intent.
It also demonstrates that
OSHA is using tools in addition to enforcement to achieve work place safety.
OVERALL ASSESSMENT OF OCCUPATIONAL SAFETYAND HEALTH
NEEDS IN CNMI
Our enforcement efforts continue to demonstrate major areas of non-compliance with
basic safety and health requirements on construction sites,
in garment
manufacturing, and in labor camps.
Non-compliance appears to be directly related to
the use of foreign contractors and foreign workers employed at these sites.
While we believe that training and education is important, we also know that there is a
limit to the value of such a program in CNMI.
Further, while we also believe that
consultative services have value, we are not certain that there is a need for a full time
consultant in Saipan.
Privatizing consultative services may be more practical in this
location.
In view of our continued finding of violations in garment manufacturing, construction,
.
and labor camps, we have concluded that an increased enforcement presence
augmented by a small maintenance level of training and education and a privatized
consultation service is desirable.
Further, based on our past experience dealing with
resident inspectors and contract enforcement efforts contrasted with our more
successful team inspections conducted by off-island compliance officers, we believe
unscheduled team inspections is a preferential means of maintaining our enforcement
pres^ence.
PROGRAM ACTP/rriES FOR APRIL 1996 - DECEMBER 1996
We plan to complete the current training and education effort. We believe that at the
conclusion of the current training program that a minimal maintenance training and
education effort will satisfy the need to strain
new employers and employees.
27=245 0-96-10
286
11
This would include three to four seminars per year.
Monies budgeted, but not vet
expended for QSHA technical assistance will be shifted
to cover additional
enforcement visits in FY-96 and into FY-97.
Currently, OSHA is conducting two to three team inspections in CNMI each year.
OSHA has determined that these team inspections produce more inspections and more
penalties than resident inspectors in other similar locations. OSHA believes that there
is an immediate need for two to three additional team inspections each year in CNMI.
If the garment industry grows further, or
if the number of foreign workers increases,
there may be an eventual need for a greater enforcement effort. The increased
enforcement presence inevitably means increased litigation costs. We are of the firm
opinion that team inspections rather than a resident inspector is the most effective way
we will be able to achiave the desired result of complisnca with the QSH Act by
garment manufacturing, labor camp owners, and constpjction operations.
Continued congressional funding at the current levels would provide a very welcome
assistance to OSHA in CNMI.
287
12
Employment and Training Administration
In December 1995,
staff
from the San Francisco Regional Office of
the Employment and Training Administration
(ETA)
conducted an on-
site technical assistance visit to the Commonwealth of the
Northern Mariana Islands
(CNMI)
to review the local labor
certification system.
As a result of observing the current
processes and meetings with various officials
in the CNMI
labor
certification program,
the ETA staff provided recommendations
which,
if
implemented,
would resolve many of the administrative
and technical problems found during the review of
the present
la±)or certification system.
Senior officials
in the CNMI employment service are to review the
recommendations and will
implement
those that improve the
employment service processes and reduce the dependence on non-
resident alien workers.
In order to improve the operations
in
the local employment
seirvice office,
CNMI officials are seeking
to hire an Employment Service Advisor who has previous experience
in the operations of an employment service office including
technical knowledge
in the operations of
a labor certification
program ETA in San Frcincisco are assisting in the search for
appropriate Cetndidates for this position.
Both the Federal
ouid the local CNMI officials agree that
the
local officials would benefit from technical
assistcince and
information sharing from other state employment security agencies
such as the office located in Hawaii.
Cooperation and coordination on the part of the Federal
staff
is
planned on am as-needed basis through the remainder of
1996 with
follow-up on-site visits to provide additional technical
support
after the CNMI staff begin to put
in place the improvement
initiatives.
Continued support will be provided through fiscal
year 1997.
Continued technical support and assistance to be provided by ETA
to the CNMI through the Department of
the Interior's reimbursable
agreement
for fiscal year 1997
is estimated to cost $15,000.
288
13
National Labor Relations Board
14
REPORT OF THE NATIONAL LABOR RELATIONS BOARD
ON THE FEDERAL-CNMI LABOR. IMMIGRATION AND LAW
ENFORCEMENT INITIATIVE FOR THE
PERIOD MARCH 1995
- MARCH 1996
BACKGROUND
The National Labor Relations Board is an independent Federal
Agency established to administer the National Labor Relations Act (NLFIA),
the basic law governing relations between labor unions and business
enterprises engaged
in interstate connmerce. The purpose of the NLRA is
to serve the public interest by reducing interruptions in commerce caused by
industrial strife.
It seeks to do this by providing orderly processes for
protecting and implementing the respective rights of employees, employers
and unions in their relations with one another.
In
its statutory assignment, the NLRB has two principal functions:
(1) to determine and implement, through secret-ballot elections, the free
democratic choice by employees as to whether they wish to be represented
by a union in dealing with their employers and,
if so, by which union; and
(2) to prevent and remedy unlawful acts, called unfair labor practices, by
either employers or unions or both.
Micronesian Telecommunications
, 820
F. 2d 1097, 125 LRRM 3102 (9th Cir. 1987), acknowledged that the NLRB
can assert jurisdiction over employers doing business in the CNMI.
NLRB ACTIVITY IN CNMI DURING PAST YEAR
During the past 12-16 months, about 60 unfair labor practice charges
and seven representation petitions have been filed in our Subregion 37,
Honolulu Regional Office involving CNMI employers and employees that
work there.
Subregion 37 estimates that these unfair labor practice
charges, many of which are
still pending, affected about 1500-2000
employees. The representation cases resulted in six elections, involving a
total of about 1500 employees.
290
15
Subregion 37 believes that a iarge number of the unfair labor practice
and representation cases were filed because of the publicity received
in our
handling of Saipan Hotel Corporation d/b/a Hafadai Beach Hotel, filed
in the
fall of 1994.
Hafadai Case
In Hafadai
, a group of legal alien workers employed by the Hotel filed
numerous charges alleging that the Hotel committed various unfair labor
practices.
At the same time these workers formed their own labor
organization and filed a petition seeking an NLRB-conducted election. A
hearing was conducted in January 1995 on the representation petition and
as to the propriety of the Board asserting jurisdiction
in the matter.
Thereafter, a decision was issued by the Regional Director for our Region
20, San Francisco Regional Office (which has responsibility for Subregion
37) and, later by the Board, finding that jurisdiction was properly asserted.
An election was conducted on July 14, 1995 and ultimately the
petitioning Union, Hotel Employees and Restaurant Employees Local 5,
was certified as the collective bargaining representative of the employees.
The Hotel declined to bargain with the Union, which resulted in an unfair
labor practice charge alleging an unlawful refusal to bargain. On
December 19, 1995 the Board issued a decision at 320 NLRB No. 24
reiterating
its assertion of jurisdiction in the Hafadai matter and finding that
the Hotel had unlawfully refused to bargain with the Union. The Hotel
sought review of this decision in the Ninth Circuit Court of Appeals, and the
Agency filed a cross petition for enforcement. A decision is pending.
At the same time, numerous unfair labor practice charges were filed
against Hafadai with Subregion 37.
After an extensive investigation,
it was
determined that approximately 25 employees of the Hotel were terminated
because of their union activity and support.
Because of the egregious
nature of these and other alleged unfair labor practices, the Regional
Director sought immediate interim injunctive relief, under Section
1 0(j) of the
NLRA from the United States District Court for the Northern Mariana
Islands.
In June 1995 the judge granted the injunction and required the
Hotel to immediately cease its unlawful conduct and reinstate the
discharged employees.
291
16
Instead of participating in an unfair labor practice trial before an
administrative law judge, representatives of the Hotel and of the General
Counsel of the NLRB entered into a stipulated record which is currently
pending before the Board in Washington.
It should be noted that the
Respondent essentially admitted
it discriminated against the employees
because of their union activity and support, but contested the Board's
jurisdiction.
Union Organizing Activity
While the Hafadai case arose in the hotel industry, union organizing in
the CNMl has involved a variety of work settings, including a brewery,
restaurants, department stores, grocery stores, shoe stores, bakeries,
supper clubs, and garment manufacturers.
It has largely involved the
nonresident workers who are of Philippine ancestry.
In order to substantiate its organizing efforts and to show a
commitment to the employees in the CNMl, the Hotel Employees and
Restaurant Employees Local 5, AFL-CIO, informed us in February 1996 that
it has established an office in the CNMl. That office has filed a steady
stream of unfair labor practice charges in the past few weeks. We
anticipate that the Union's presence will lead to an ongoing flow of charges.
Pending Investigations and Litigation
As of March
1 996 the Agency had pending before
it a larger than
anticipated number of CNMl cases.
At the initial investigation stage there
were 42 unfair labor practice charges involving various employers who
employ over a thousand employees. The Agency has issued complaints in
seven cases, and complaint has been authorized in two additional cases. Of
these, two cases are awaiting determination by the Board and, as noted
above, one significant case (the Hafadai case)
is pending before the 9th
Circuit Court of Appeals. The other complaint cases are awaiting trial before
an administrative law judge.
Additionally, the Regional Director for Region 20 (which covers parts
of California, and Hawaii, American Samoa, Guam and the CNMl) has
recommended to the General Counsel that the Agency seek injunctive relief
in the U.S. District Court ordering reinstatement of approximately 38
292
17
employees who were unlawfully terminated from a major CNMI employer.
Two other such requests are in the final stages of investigation and are
being considered by the Regional Director.
Such cases involve significant
amounts of investigation, analysis, and legal preparation.
In addition to the litigation mentioned above, the Agency has also
been successful
in reaching settlements in five cases. The settlements
have ranged from the posting of notices to backpay and reinstatement of
employees.
Contact with Various CNMI Government Agencies and Officials
Our Agency has had numerous written and oral communications with
a variety of CNMI government officials ranging from the Director of CNMI
Labor and Immigration to the Acting Attorney General.
Most of these
communications have arisen in the context of an apparent conflict between
the National Labor Relations Act and the "local preference" provisions of the
CNMI's Nonresident Worker's Act.
In all of our contacts, we have expressed our desire to work with the
CNMI government in a cooperative effort to resolve some of the aforesaid
apparent conflicts.
It is recognized that our positions do not always
coincide. On several occasions we have received cooperation and
assistance from local officials.
For example,
in June and July 1995 the
government was helpful in assisting the Agency to obtain temporary work
permits for the nonresident employees at the Hafadai Hotel who were
ordered reinstated pursuant to the U.S. District Court's decision discussed
above.
However, CNMI policies are subject to change.
Thus,
in a matter of
months (in December 1995), the government informed us that the CNMI
would no longer grant temporary work permits to persons who were fired or
non-renewed in their nonresident employment contracts with CNMI
employers.
Further, we were informed that those individuals would be
subject to deportation. CNMI Labor & Immigration then notified certain
individuals involved in some of our cases that they would be subject to
deportation.
This included two prominent union activists, Vicente Perez and
Honorio Cambronero.
Mr. Perez was forced to voluntarily leave the CNMI
rather than suffer the consequences of a deportation order, notwithstanding
293
his status in the Hafadai case referred to above (in that case, Hafadai
admitted
it refused to rehire Mr. Perez because of his union activity.) The
proposed deportation of Mr. Cambronero did not occur because the CNMl
Department of Labor acted to accept and consider a claim he filed with
them, which entitled Mr. Cambronero to a temporary work permit.
The above shift in policy meant that persons who alleged
discrimination because of their union activity could have been deported
before an NLRB agent could investigate their allegations.
Similarly,
employers could threaten nonresident employees with non-renewal of their
contracts
if they joined a union, complained about working conditions, spoke
to an OSHA inspector or filed a complaint with the Department of Labor.
In
face of this, on February 16, 1996 NLRB General Counsel Fred Feinstein
notified the CNMl Acting Attorney General in writing that the Agency would
consider measures (including legal proceedings in the U.S. District Court for
the Northern Mariana Islands), to prohibit the above policy and protect the
workers' rights.
Thereafter, the CNMl government issued an interim policy whereby
the CNMl Department of Labor and Immigration will issue temporary work
permits to persons who file valid claims with the NLRB. Thus these
individuals would not face deportation
if they were able to obtain work.
The Agency has suspended
its plans for legal action in light of the
interim policy. CNMl officials have requested a greater NLRB presence in
the CNMl, so that unfair labor practice charges could more quickly be
investigated. The CNMl government was concerned that nonresidents
would simply file NLRB claims to remain in the CNMl.
Moreover,
if the
NLRB had a greater presence, an investigation would be able to segregate
the nonmeritorious cases from those asserting viable claims.
Further, the
recent Congressional delegation to the CNMl has encouraged Federal
Agencies to enforce U.S. labor laws, but to work in a spirit of cooperation
with CNMl governmental officials so that mutual concerns can be
addressed.
294
Future Case Filing
Based upon the foregoing and the apparent unabated growth
in the
CNMI,
it is fair to say that the Agency underestimated the amount of time we
would need a full time agent in the CNMI.
Apparently there are plans for
6,000 additional hotel rooms and an increased number of workers from the
Peoples Republic of China.
This would increase the number of nonresident
workers and other employees who can avail themiselves of U.S. labor laws.
The increased presence discussed above was not anticipated by our
technical assistance request of November 28, 1995, As a result, we will
probably need to amend that request later in the fiscal year.
Certainly a
request for additional money so as to adequately staff our activities in the
CNMI for fiscal year 1997 will be necessary to handle the anticipated
investigations, and legal proceedings, and to have a "presence" necessan/
to enforce the law.
We anticipate that this increased presence would allow us to give
training to CNMI labor officials and business leaders regarding the National
Labor Relations Act.
Further, we would hope to finalize more formal joint
cooperative efforts with CNMI government officials.
At present we have plans to send an experienced attorney from our
San Francisco Regional Office to the CNMI for at least a 3-month period
starting on or about April 8,
1 996, or as soon as the Department of Interior
receives the necessary Congressional funding. The U.S. Department of
Labor has graciously allowed us to use some of their office space.
That
attorney will handle a variety of investigative and legal assignments, and
serve as a source of information to people in CNMI who have questions
about provisions of the NLRA.
The per diem and air fare costs, as well as staff time, associated with
this detail (and future details which will clearly be necessary) will be
significant.
In addition the Agency will face the costs of litigating meritorious
unfair labor practices, including travel for the trial attorney and the
administrative law judge, as well as court reporting and transcript costs.
Cases, such as Hafadai
.
which require the Agency to seek interim
injunctive relief in Federal Court pending disposition of the unfair labor
295
20
practice allegations have the potential for additional travel and other costs,
as do, inter alia, cases which may require a hearing to dispose of
determinative challenged ballots or objections to a representation election.
Proposed CNM! Rules and Regulations
The CNMI government has specifically requested the Agency to
comment by the end of March on proposed rules and regulations from the
CNMI's Department of Labor and Immigration. The Agency submitted
comments on March 28, 1996.
We want to emphasize that the NLRB General Counsel's office
remains strongly of the view that, in order to effectuate the purpose and
policies of the National Labor Relations Act, a nonresident worker must be
permitted to remain in the CNMI pending final resolution of his case by the
Board.
This would, of course, include any legal challenges, including
enforcement of Board Orders at the U.S. Court of Appeals.
Future Funding of the Initiative
The NLRB was not one of the original members of the Federal-CNMI
Labor, Immigration and Law Enforcement Initiative.
However, approximately
1 year ago we became a member and have been most grateful for the
assistance, support, and information supplied by the various task force
members.
As noted above, the NLRB has been involved in substantial litigation
with various business entities. The cases have involved virtually every
aspect of the CNMI's economy, and have required a significant expenditure
of the Agency's increasingly limited staff time and budgetary resources.
It is
absolutely imperative that the Initiative continue to be funded.
If the Initiative
funding was decreased or eliminated our Agency would not be able promptly
or effectively to can^ out our mandate to enforce the NLRA.
296
U.S. Department of the Interior
Office of Inspector General
297
22
REPORT OF THE U.S.
DEPARTMENT OF THE INTERIOR
OFFICE OF INSPECTOR GENERAL
ON THE FEDERAL-CNMI
LABOR,
IMMIGRATION AND LAW
ENFORCEMENT INITIATIVE
BACKGROUND
The Office of Inspector General provides policy direction
for and
conducts,
supervises,
and coordinates
all
audits,
investigations,
and
other
activities
in
the
Department
of
the
Interior
(DOI)
designed
to promote economy
and efficiency or prevent and detect
fraud,
waste,
and mismanagement.
The
Inspector General
is
DOI's
focal point for independent and objective reviews of the integrity
of operations;
is the central authority concerned with the quality,
coverage,
and coordination of the audit and investigative services
of
CKDI;
and
reports directly
to the Secretary
of
the
Interior on
these
matters.
The
Inspector
General
provides
the
means
for
keeping the Secretary and the Congress fully and currently informed
about problems and deficiencies relating to the administration of
DOI
programs
and
operations
and
the
necessity
for
corrective
action.
In the insular areas
of Guam,
American Samoa,
the Virgin Islands,
and
the
Commonwealth
of
the
Northern
Mariana
Islands,
the
OIG
performs the functions of government comptroller through audits of
revenues,
receipts,
expenditures,
and property
in accordance with
the
Insular
Areas
Act
of
1982
(48
U.S.C.
1422).
The
OIG
has
additional
audit
responsibilities
in
the
Federated
States
of
Micronesia,
the Republic of the Marshall Islands,
and the Republic
of
Palau pursuant to
the Compact
of
Free Association Act of
1985
(P.L.
99-239).
The authority
of the OIG to conduct investigative
activities
in
these
areas
is
derived
solely
from
the
Inspector
General
Act
of
1978,
as
amended.
The
Inspector
General
Act
authorizes
OIG
personnel
to conduct
investigations
only
in
those
matters
pertaining
to
the
programs
and
operations
of
the
Department.
OFFICE OF INSPECTOR GENERAL
PARTICIPATION ON THE CNMI FEDERAL TASK FORCE
The OIG has been a member of the CNMI Federal Task Force since its
inception.
Indeed,
prior
to the creation
of the task
force,
the
OIG provided investigative coverage to the CNMI from its Guam Field
Office.
When
the
CNMI
Federal
Task
Force
was
formed,
the
OIG
expanded its investigation of public corruption
in the CNMI
as
its
contribution to the task force.
A senior agent from the OIG's Guam
Field Office
is assigned to the task force and frequently travels
to
the
CNMI
in
furtherance
of
task
force
investigations.
This
agent
has
extensive
experience
conducting
public
corruption
investigations
in
the
U.S.
Territories.
Currently,
the
OIG
has
five
investigations that have been
initiated as
a
result
of task
force efforts to ferret out public corruption
in the CNMI.
298
23
CONSIDERATIONS FOR FUTURE PARTICIPATION
BY THE OFFICE OF INSPECTOR GENERAL
ON THE CNMI TASK FORCE
During the past year the OIG has received limited financial support
(approximately $20,000)
covering the costs of our agents' travel to
the
CNMI
in
furtherance
of
task
force
investigations.
This
arrangement
is
the
result of negotiations with
DOI's Director
of
Insular Affairs.
The OIG
did
not
receive
any
of
the
$7
million
appropriated by Congress to support the Initiative and
is not
in a
position,
given our limited resources
and
small
size
(a
total
of
only 39 agents)
to absorb costs which may be associated with future
task
force
activities.
If
additional
support
from
the
OIG
is
required,
we
recommend
that
funding
be
provided
to
the
OIG
to
support that effort.
299
U.S. Department of Justice
Office of the Deputy Attorney General
Drug Enforcement Agency
National Institute of Corrections
Immigration and Naturalization Service
Executive Office for the United States Attorneys
United States Marshals Service
Civil Rights Division/Criminal Section
Federal Bureau of Investigation
Criminal Division/Child Exploitation and Obscenity Section
24/25
300
26
DRUG ENFORCEMENT ADMINISTRATION
ASSISTANCE TO CNMI
Based on the recommendations of a Federal interagency working group, Congress
provided funding to various Federal agencies to be used to support a new federal initiative in
adaressing law enforcement, labor, immigration and revenue issues in the Commonwealth of the
Northern Mariana Islands (CNMI). What follows is a status report on the activities and
accomplishments in the CNMI during the past year.
Additionally, an assessment of the current
situation was made resulting in the following Drug Enforcement Administration's
recommendation to Congress.
BACKGROUND
On September 22, 1994, the Senate Subcommittee on Mineral Resources Development and
Production heard testimony from Govemor Froilan C. Tenorio of the Commonwealth of
Northern Mariana islands (CNMI) and the Administration on labor abuse, law enforcement and
immigration problems in the CNMI. As a result of this hearing, a federal interagency working
group was formed to develop a coordinate Administration position on these issues.
Additionally,
the working group developed an initial plan for the allocation of $7 million appropriated by
Congress under Public Law 103-332.
Subsequently, a Reimbursable Support Agreement was developed between the Department or
Interior (DOF), Office of Territorial and International Affairs and the participating Departments
reimburse the participating Departments for direct costs in providing assistance to CNMI in
accordance with specific plans and costs estimates.
301
27
BACKGROUND fcontinued^:
The Drug Enforcement Administration would enhance enforcement of Federal drug laws and
train local law enforcement officials in drug investigative and enforcement techniques and
practices. The working group, based on recent seizures of crystal methamphetamine ("ICE") in
the CNMI from the Philippines, and their belief that there is a strong relationship between the
aliens living and working in the CNMI and "ICE" trafficking in CNMI, recommended that the
DEA station two (2) DEA agents in the CNMI for 1/2 of FY95 and all of FY96 and FY97. The
estimated cost was $750,000.
Before committing DEA personnel to CNMI, DEA elected to conduct the two separate on site
assessments of the narcotics trafficking situation in the CNMI. The first assessment was a fact
finding mission consisting of a series of in-depth interviews along with an extensive review of
CNMI government records and other published statistical information in Saipan. The second
facet of the original study
entailed two Special Agents fi-om Los Angeles, California
participating in actual enforcement activit}' in Saipan to determine the level of drug trafficking
activity and to evaluate the sophistication of identified drug traffickers.
Based on the results of these assessments the DEA has decided that the most efficient way to
address the "ICE" problem was to conduct various training sessions for the CNMI law
enforcement officials, and to establish an Ad-Hoc Task Force. DEA has received approximately
$250,000 under P. L. 103-332. Thus far, utilizing the funds fi-om P.L. 103-332, DEA has
conducted three separate training schools ranging fi-om one day to two weeks (Firearms and
Tactical Traitiing, Drug Identification/Certification Training Course, and Basic Narcotics Law
Enforcement School). DEA has also assigned a senior special agent fi-om the Guam Post of Duty
on a full time basis to travel to Saipan weekly (TDY) to supervise and initiate drug investigations
vnth. local law enforcement officers. We have initiated approximately
1 5 separate drug
investigations involving "ICE" in Saipan.
s
Vn
302
SUMMARY AND ArCOMPMSHMENTS
March 8. 1995 to May 19. 1995
DEA dispatched two (2) Special Agents from the Los Angeles Field Division (LAFD)
to begin a
comprehensive
law
enforcement
assessment
of
the
narcotics
trafficking
situation
in
the
Commonwealth of the Northern Mariana Islands (CNMI). The fact finding mission consisted of a
series of
in-depth interviews and extensive review of CNMI government records and other
published statistical information in Saipan.
August 1. 199 5 to October 3. 1995
DEA dispatched the same two (2) Special Agents from the Los Angeles Field Division (LAFD) to
initiate and complete
the second
facet of the
original
study
in
Saipan, CNMI. The agents
incorporated actual enforcement activity to determine the level of drug trafficking and to evaluate
the sophistication of identified drug traffickers.
The following two cases were initiated in which purchases of high purity crystal methamphetamine
were purchased:
The first case wras a cooperative investigation involving DEA, FBI-Saipan, Saipan Department
of Public Safety (DPS), and Saipan Division of Customs (SDC). The investigation culminated with
the indictment and arrest of the principal violator of Japanese/Korean descent and his wife, as well
as three (3) local residents. Charges of Conspiracy to Import (2i USC 952), Conspiracy to Possess
with Intent to Distribute and Distribution (21 USC 841 and 846), and forfeiture of currency (485,000
yen) have been levied against the defendants. Another indictment is expected in the near ftiture for
the arrest of a second suspect, who
is a local resident.
Approximately 200 grams of crystal
methamphetamine was seized from one of the defendants.
The second case was a cooperative investigation involving DEA, FBI, Saipan DPS, and ATF. The
principal defendant of Japanese descent sold 99% crystal methamphetamine and was arrested.
Further investigation led to the seizure of 178.6 grams of crystal methamphetamine from the
principal defendant.
Pursuant
to a plea agreement,
the
principal
violator has pled
guilty
to
Distribution of Methamphetamine
(21 USC 841
(a) (1)) which carries a minimum of 10 years
imprisonment and is now cooperating with DEA and FBI.
September 5 to September 8. 1995
The Firearms Training Officers from the LAFD conducted Firearms and Tactical Training for the
Guam POD personnel as well as law enforcement personnel from Saipan.
28
303
29
SUMMARY AND ACCOMPLISHMENTS fcontinuedV
September 22. 1995
Assistant Special Agent in Charge (ASAC) Sidney A. Hayakawa of the Hawaii District Office
(HDO) dispatched three (3) Guam Post of Duty personnel to Saipan, CNMI to review
investigative files relating to ten (10) homicides which CNMI officials claim to have some
relation to drug trafficking.
After an extensive review of the investigative case files and
interview of the homicides investigators,
the final conclusion did not support the claim of the
CNMI officials that the homicides were drug related.
October 10 to October 13. 1995
ASAC Hayakawa visited Agana, Guam and Saipan, CNMI and met with various government
officials from Guam and Saipan, as well as Federal agency officials stationed in Guam and
CNMI to discuss DEA assistance to the CNMI.
October 16. 1995
ASAC Hayakawa reassigned Senior Special Agent (SSA) Jake Fernandez of the Guam Post of
Duty, on a full-time basis, to supervise and initiate drug investigations in Saipan, CNMI.
Since
his reassignment, SSA Fernandez has been working jointly with Saipan DPS and Customs
persormel, along with other Federal agencies on drug related investigations. Once the proposal to
form an AD-HOC Task Force is approved, SSA Fernandez will be in charge of this Task Force.
It is anticipated that SSA Fernandez will spend 90% of his time on a TDY basis in CNMI.
October 30. 1995
DEA's Western Laboratory dispatched three (3) Forensic Chemists to conduct a one day Drug
Identification/Certification Training Course in Saipan, CNMI. There were a total of 76 students
who attended this course.
They were from DPS and Customs personnel from Saipan, Rota, and
Tinian.
304
30
SUMMARY AND ACrOMPI.TSHMKNTS (continued^:
October 31. 1995
Special Agent in Charge (SAC) Robert E. Bender of the Los Angeles Field Division, based on
the two separate assessments of the level of drug trafficking activity and composition of the drug
traffickers in the CNMI, submitted a written request to DEA Headquarters, proposing to form an
AD-HOC Task Force using the remaining funds allocated to DEA by the Department of Interior
under Public Law 103-332. The proposal would cross designate and provide Title 21 authority
to select law enforcement officers from the Saipan Department of Public Safety and the Saipan
Division of Customs.
Additionally, the agreement would pay for the overtime for these officers,
up to a sum equivalent to 25% of the salary of a GS-IO, Step
1, Federal employee per officer per
annum and provide funding for the purchase of evidence and information. This proposal was
presented, in lieu of opening a DEA office in Saipan, to the Governor of CNMI, the Attorney
General of CNMI, and heads of the DPS and Customs during ASAC Hayakawa's recent visit to
Saipan. The CNMI officials were very much in favor of the proposal and would want to see this
proposal be implemented.
November 7. 1995 to November 19. 1995
DEA dispatched three (3) Special Agents from the Office of Training, International Training
Section, along with an agent from the Guam Post of Duty to conduct a two (2) week Basic
Narcotics Law Enforcement School in Saipan, CNMI.
Approximately 45 law enforcement
officers attended this school. They were from DPS and Customs personnel from Saipan, Rota,
and Tinian.
January 31. 1996
On January 31, 1996, DEA approved the formation of the Task Force. On February 28, 1996,
Governor Froilan C. Tenorio presided over the official signing ceremony of DEAyCNMI Ad-Hoc
Task Force agreement in Saipan, CNMI.
Besides Governor Tenorio, Special Agent in Charge
Robert E. Bender of the Los Angeles Field Division of DEA, Attorney General C. Sebastian Aloot
of Saipan, Chief Jack S. Shimizu of the Guam Police Department, Commissioner Jose Castro of
Saipan Department of Public Safety, Secretary of Finance Antonio R. Cabrera (for Saipan Customs),
and United States Attorney Frederick A. Black, District of Guam and the CNMI, as well as other
"Federal and local office heads were in attendance.
Thus far, we have initiated
1 5 separate crystal methamphetamine drug investigations involving either
Korean nationals, Japanese nationals, Filipino nationals
or Chamorros (local residents).
sm
ASSKSSMENT OF THE CURRENT SITUATION:
Crystal methamphetamine is the drug of choice followed by marijuana and continues to be readily
available
in
the CNMI.
Crystal methamphetamine being imported
into
the CNMI from
the
Philippines and Japan is for local consummation only.
Smugglers are using internal body carry to
smuggle the drug into CNMI.
Crystal methamphetamine is sold on the streets in Saipan by
the
"plate"; a $50 plate is for personal consumption, a $100 plate is approximately 1/5 gram, a $200
plate
is approximately 2/5 gram, and a $500 plate is approximately
1 gram.
Unless you are well
known as an established "ICE" trafficker,
it is very rare and difficult to purchase an ounce or more
of the drug in Saipan. Local businesses, private residents, gambling establishments (pokers rooms)
and. Karaoke/bars lounges are known locations to purchase "ICE".
Based on actual undercover
negotiations, debriefing of confidential sources, and intelligence information, there is no substantial
evidence of a truly organized effort to import or transship drugs into the CNMI. Although targeted
Japanese nationals are significant traffickers by CNMI standards and have ties to Japanese organized
crime (YAKUZA), they appear to be operating independently, primarily for personal gains. Tnere
is no one faction that controls or
is responsible for the drug and
its distribution
in the CNMI.
Jewelry has been known to be used as a form of payment or used in exchainge for "ICE".
Property
crimes (burglary cases) in the CNMI has a direct correlation to illegal drug activities. There appears
to be various distributors who are known to each other and will exchange or sell their "ICE" to one
another. However, there are five ethnic groups that are primarily involved in the selling of "ICE";
they are Filipinos, Chamorros, Chinese, Koreans and Japanese.
"ICE"
is also sold on school
grounds to high school teenagers.
Approximately one half of the CNMI population consists of
immigrant workers from the Philippines and surrounding areas.
These alien workers
ftiel the
consummation or need for "ICE" in the CNMI.
RECOMMENDATION TO CONGRES S:
The main
purpose
of the DEA/CNMI Ad-Hoc Task
Force
is
to
provide
training
in
drug
investigations to local law enforcement officers and to apply what they leam in initiating actual drug
investigations.
This approach will instill self-confidence to the local law enforcement officers in
initiating drug investigations and will make them become self-sufficient.
Local law enforcement
personnel in CNMI lack the resources, competence and funding necessary to adequately confront
the "ICE" problem in the CNMI. This process has just started with the signing of the DEA/CNMI
Ad-Hoc Task Force agreement.
We would like to assess their progress and provide advanced
training
in investigative techniques and the utilization of technical equipment.
Additionally,
prevention and drug awareness education are key components
in a successful program. Experience
is the best teacher and time will be the best indicator as to our success.
306
32
RErOMMFNDATTON TO CONGRESS (continued:
DEA's recommendation would be to continue support and fund this Task Force in the amount of
$250,000 for Fiscal Year 1997.
If approved, the additional funds would be used to initiate drug
investigations and to purchase technical equipment (i.e., kel-units, binoculars, tape recorders, raid
and safety equipment, video and audio equipment, etc.), to aid local law enforcement officers in
conducting narcotics investigations.
Additionally, the funds would also be used to upgrade their
computers and to provide programs for case and confidential source management and to provide
additional training in intelligence gathering and
interviewing techniques.
307
U.S. Department of Justice
3 3
National Institute of Corrections
WaMngton, DC 20i34
C0!«1M0NWEALTH OF THE NORTHERN MARIANA ISLANDS
CORRECTIONAL REVIEW
U.S.
Department
of Justice
National
Institute
of Corrections
Marcti
25,
1996
Since
the
initial meeting
in Saipan on November
1 and
2,
1994,
the
National
Institute
of
Corrections
(NIC)
has
worked
with
the
Commonwealth
of
the
Northern
Mariana
Islands
(CNMI)
and
federal
criminal
justice
and
law
enforcement
agencies
to
provide
correctional expertise
and
assistance.
The
$50,000
transfer
from
the Department of Interior enabled NIC to complete an assessment of
CNMI's corrections services and future needs and to provide limited
technical assistance and training.
BACKGROUND
.,..;.,
February
6
through
10,
1995
'
NIC
officials
completed
an
assessment
of
CNMI's
correctional
programs
and
future
needs.
All
correctional
facilities
were
visited.
In
addition
to
working
closely
with
Public
Safety
personnel,
we
met
with
the
Lieutenant
Governor,
legislators,
juvenile
authorities,
immigration
officials,
citizen
groups,
the
resident
federal
judge,
and
federal,
state,
and
territorial
officials
in
CNMI,
Guam,
and Hawaii.
The overall
impression was
that
there was
little or no knowledge that correctional
expertise
existed.
There was
a consensus that change was
needed.
July
31
through August
4,
1995
NIC officials returned to Saipan to present a modified Correctional
Management
Training
Program
with
special
emphasis
on
creating
policy
and
pcocedures.
The
training
was
well
attended
by
top
officials
from
Public
Safety,
Immigration,
Customs,
and
the
Governor's
Planning
Group.
Before
the
end
of
the
week,
five
correctional
policies
and
the
procedures
had
been
developed
and
written.
Also,
this week was used to identify what would be needed
for an action plan
for corrections.
308
FINDINGS
In CNMI,
adult corrections
is
located organizationally within
the
Department of Public Safety.
There
is
a Corrections Division with
a
Corrections
Director.
Public
safety
officers
are
assigned
as
needed
to
corrections;
none
are
permanently
assigned
to
corrections.
Correctional
facilities
are
located on three
of
the
islands
-
Saipan,
Tinian,
and Rota.
These
facilities consist
of:
-
a detention
facility
(unsentenced)
(Saipan)
-
a
jail
(sentenced)
(Saipan)
-
a women's unit
(sentenced and unsentenced)
(Saipan)
-
a
worlc release unit
(Saipan)
- police lock-ups
(Tinian,
Rota)
The
facilities
in
Saipan
are
adjacent
to
each
other,
creating
a
small correctional
complex.
Juvenile
offenders
are
handled
by
Youth
Services.
A
juvenile
facility
has
been
closed
for
repairs.
Although
the
repairs
are
near completion,
the opening may be delayed
for
lacic
of operating
funds
and community resistance.
If Youth Services needs
to house
a juvenile,
the individual
is housed in a local hotel.
No juvenile
was
in that
level
of supervision during any of our visits.
There
is no immigration holding facility.
If
the need arises,
the
individual
is
held
by
Public
Safety.
There
is
no
policy
or
procedures
for
handling
juvenile
immigrants
or
immigrants
with
minor children.
The U.S. Marshals Service has
a contract with CNMI to house federal
prisoners,
when needed.
The
following are
some additional
findings
from NIC's assessment,
made
during
our
first
visit
and
reconfirmed
during
the
second
visit
-
Correctional
services
in
CNMI
do
not
meet
the
American
Correctional
Association's
Standards,
the
United
Nations
Standards,
or any other professional correctional
standards.
-
Jails and prisons have experienced court
interventions
for
similar conditions of confinement or operating practice.
-
The population appears
to range
from
70
to
130
inmates.
-
There
is very limited use of
inmate counts
as
a security
tool
or
to develop baseline,
management
data.
- Although
ptrtJlic safety employees receive public safety and
related police training,
no jail or prison related training is
provided.
Most
staff have not seen any other
jail or prison
operation.
'
34
35
-
There
is
no
inmate
classification
system.
Inmates
are
housed where
there
is
a vacant bed or space.
- Women are housed separately.
(There has been,
at least,
one
lawsuit concerning
a possible exception
to
this
rule.)
- Seven to nine public safety officers are usually assigned to
correctional duties per shift.
There is limited documentation
of these work assignments.
-
There
appears
to
be
no
post
(duty)
assignments
for
staff
within the
facility.
-
There
is almost complete
inmate
idleness.
There
is
little
or no inmate programming
(educational,
worlc, or recreational)
- All of the facilities
(buildings)
are inadequate.
There are
issues
of
life
safety,
health and
sanitation,
security,
and
overall general
repair
that affect both staff and inmates
in
all
the structures.
- The design and conditions of the facilities make renovations
prohibitive
Inmate
medical
screening
and
services
appear
to
be
inadequate
-
Food services are contracted out
to
a private business.
There
appears
to
be
little
or
no
documentation
of
correctional
activity,
except
by word-of -mouth
Perhaps
the most positive
finding has been that management within
Public
Safety
has
been
open
to
acquiring
more
correctional
expertise and initiating change.
ASSESSMENT OF THE CURRENT SITUATION:
The major issue continues to be facility construction
-
How to get
the
funds?
Where should
it
be built?
At one point,
168 acres had
been
identified
as
the
site
by
the
CNMI
government.
Then,
it
was
reduced to
6 acres.
At
this moment,
no one
in the CNMI government
can or will confirm anything,
except
that
it
is
a priority
issue.
In
the
meantime,
NIC
is
arranging
for
the
placement
of
CNMI
officials
into
its own training programs as well as other training
efforts,
setting up site visits
to model correction programs when
CNMI
officials
are
traveling,
and
providing
information,
sample
programs,
and core curriculum
to CNMI
officials.
The next on-site training
is scheduled to be the development of an
inmate classification or planning
for
a new institution.
310
36
RECOMMENDATIONS TO CONGRESS:
The National
Institute of Corrections'
recommendations
are:
1)
New facilities are required.
Funding for this purpose and
site selection must
be made a priority.
If
this
is not done,
funds
will
be
expended
in
attorneys'
fees,
court
costs
and
judgements,
and court -ordered solutions.
2)
New facilities are not automatically equipped with trained
staff
and
inmate
programs
and
services.
Every
aspect
of
corrections
needs
to
be
reviewed,
policies
and
procedures
developed and updated,
and staff identified and trained.
Much
of
the
change
that
is
needed
needs
to be built
upon
change.
As
the
system
grows
and
becomes
more
sophisticated,
the
initial programs will need
to enhanced.
$100,000
a ye^r
for
the
next
four
to
five
years
will
be
needed
to
provide
for
staff
training
and
technical
assistance
to
improve
correctional
management
and
develop
and
implement
inmate
programs and services
With
the
continued
economic
development
on
Saipan,
Tinian,
and
Rota,
these
correctional
issues
will
only worsen.
Additionally,
the
need
for
immigration
holding
and
detention
space
appears
to
heighten the need
for action.
mi
37
INS Report to the Department of the Interior
Concerning the Commonwealth of the Northern Mariana Islands
March 22, 1996
I.
Summary of recent activities in the Commonwealth of the Northern Mariana Islands
(CNMI)
The Immigration and Naturalization Service (INS) has monitored immigration-related events
in the CNMI by several means:
A contingent ofINS oflBcers visited the CNMI in February to examine immigration practices
and to assess progress of the CNMI regarding immigration issues.
This group included the
INS
Assistant District Director for Examinations,
Honolulu, Hawaii; the INS OfiBcer-in-
Charge, Agana, Guam; and a representative from INS Headquarters OfiBce of Information
Resources Management (IRM).
Issues discussed included:
Development of the CNMI's Labor and Immigration Identification Documentation
System,
Airport arrival and departure control;
Immigration removals from the CNMI (process and funding);
CNMI rales applying to temporary workers.
o
The INS has selected an experienced investigator to be stationed for two years in the CNMI,
with a target date for entry on duty of early May. He will be supervised by the INS Officer-
in-Charge, Agana, Guam. Among his duties will be:
To assist the Assistant U.S. Attorney in Guam in immigration enforcement activities;
To conduct training and mentoring of CNMI immigration staff,
To
assist
in
the coordination of CNMI immigration and
labor departments
in
implementing effeaive systems and business practices;
To represent the INS in the CNMI,
To report on topics of immigration concern, both to the CNMI and to the INS;
To assist Federal and local law enforcement agencies in planning and conducting
investigations and other initiatives.
o
The INS
Office of Information Resources Management
(IRM)
has provided technical
assistance to the CNMI to
facilitate
development of a computerized system to support
immigration processes. To date, that assistance has been monthly telephonic consultation,
including conference calls with various staff present, regarding development methods, data
element
content, and system components.
The INS
plans
to conduct an independent
validation
and
verification
of
the
CNMI's
system
as
it
progresses,
and
to
make
recommendations for optimal system effectiveness.
(Attached is a synopsis ofERM findings
during the February on-site review.)
312
38
n.
Assessment of immigration developments in the CNMI
The INS
will have an officer on duty in the CNMI beginning in May to assess CNMI
inunigration issues.
INS officials detailed to the CNMI have made the following observations and
assessments:
The CNMI is making some qualified progress on several immigration problems, including:
Development and implementation of a computerized system of immigration processes
(see IRM report attached);
Implementing an arrival-departure process;
Removing unauthorized aliens fi^om the CNMI;
Using safeguards on security documents and protecting computerized systems from
unauthorized changes to the database;
Issuing tamper-resistant documentation for temporary workers;
Refusing entry and removing persons who fail to meet entry requirements;
Improving
the
immigration
department's
effectiveness
by
re-engineering
their
processes and hiring effective personnel.
m.
Other issues
o
The CNMI must become much more efifective in deporting immigration law violators, as weU
as aliens who violate other laws. When the CNMI is better able to identify persons through
an expanded database of its temporary workers, law enforcement will become more effective.
The curtent temporary worker data base contains about 14,000 entries. Funds must also be
set aside to carry out deportations.
Detention fecilities, both long term and short terni, wUl need to be improved before CNMI
authorities can undertake any significant enforcement
initiatives to expel unauthorized
persons.
o
The current lack of detention space that meets federal standards does not prevent CNMI
authorities from refiising entry to unqualified persons.
Currentiy the CNMI does return some
individuals on the next avaUable flight when they do not meet entry qualifications.
This
screening should be encouraged and fully used.
o
The INS considers implementation of a computerized arrival and departure system to be the
first priority for the CNMI immigration service in regaining immigration control.
Though
fimds were allocated for this purpose, progress has lagged due to contract support problems.
Arrival and departure control is a part of the overall support system planned. The first part
of a system implemented has been a prototype for processing applications and controlling
entry of temporary workers.
It is important to the effectiveness of the CNMI immigration
service that development of
tiie labor and immigration identification and documentation
313
39
system continue at as rapid a pace as possible.
Tlie dififerences between INS and CNMI
inunigration laws have different kinds of impact in
different areas.
For example:
The INS does not believe that CNMI immigration problems directly impact the
security of other parts of the United States, in that persons traveling legally from the
CNMI to Guam or elsewhere in the United States must go through INS inspection
before they are admitted.
Though persons traveling from the CNMI to the United States must go through INS
inspection, smuggling of persons from the CNMI to the United States may occur, if
persons leaving the CNMI succeed in entering the United States at a location other
than a designated Port-of-Entry.
The CNMI immigration statutes have some impact on lawful permanent residents of
the United States who reside
in the CNMI.
For example,
lawfijl residents must
register to work legally
in the CNMI, and while residing
in the CNMI,
are not
considered to be residing in the United States, which could lead to loss of permanent
resident status.
The INS and the Department of Justice have not taken an official position on extending the
Immigration and Nationality Aa (INA), in whole or in part, to the CNMI.
In testimony given
before the House's Native American and Insular Affairs Subcommittee on January 31, 1995
the INS General Counsel
reviewed a number of considerations pertaining to this question.
For example, extending the INA to the CNMI;
Would render a majority of the current temporary workers in the CNMI illegal and
amenable to deportation,
Could lead to greater and more permanent immigration to the CNMI; and
Would divert INS resources to the CNMI at a time when demands on these resources
are already very great.
314
40
ENS Report on the Development of the
CNMI Labor and Immigration Identification and Documentation System (LIIDS)
Activities and accomplishments in the CNMI over the past year
INS IRM has been attempting to support CNMI' s development of their Labor and Immigration
Identification and Documentation System (LIIDS). The DOJ-DOI Interagency Agreement specifies
that INS
will perform an Independent Validation &
Verification (TV&V) of CNMI's LIIDS
development products, which involves review and constructive critique of deliverable documents and
system components throughout the development process
- the System Development Life Cycle
(SDLC).
IRM has received some preliminary development information and commented with
recommendations; however, we have not yet received any complete, final SDLC documents on which
to perform IV&V. Coordination and recommendations are being provided to CNMI's LIIDS Project
Team during their activities to conduct the development.
Systems and data bases buih by CNMI should have future compatibility with INS, should there be
a need for information interchange. CNMI and INS are endeavoring to accomplish this by comparing
data dictionaries, to assure that data elements used by the CNMI match or are readily convertible to
INS formats.
In February, INS traveled to the CNMI to meet with a team of Federal oflBcials, congressional staff,
and local government ofBcials to do on-site follow-up on the progress of the joint Federal/CNMI
labor,
immigration and law enforcement
initiative.
Discussions encompassed LIIDS
project
management and progress to-date, SDLC employment, CNMTs current immigration processes and
functional
requirements,
and planned
actions
for
modernization, through
re-engineering with
incorporation of LDDS.
The Governor of the CNMI, commensurate with
his overall strong
sponsorship of Immigration and Labor reform
initiatives, has given particular attention to the
development of automated support to be fully integrated with the re-engineered processes.
The
LIIDS Project Manager has been given direction to proceed with priority development. The LEDS
Project Team has been involved in determination and documentation of immigration and labor process
and
support system requirements,
as well
as procurement of some equipment and
software,
development of software, and establishment of a demonstration or prototype system capability for
processing of data in the initial step of a re-engineered immigration and labor process.
The prototype operational capability provides for (1) the capture of basic individual non-immigrant
identity, labor and immigration data, relating individuals to specific employers who are sponsoring
them to work in the CNMI, (2) building of a standard data base of that information, (3) issuance of
an entry permit/letter, to be used by the employee and employer to verify status for the individual's
initial entry into the CNMI, and (4) issuance of an associated ID card for each worker. The first two
steps are currently operational and the latter two expected to be implemented within two months.
This prototype
provides-»-fesic capability for the first part of an immigration control process and.
315
41
secondarily,
provides
a
valuable
learning
tool
to
facilitate
understanding
and
definition
of
requirements, in order to develop the complete, final operational capability LIIDS.
Assessment of current situation
Progress of the project has been sporadic and limited, due primarily to the lack of support staff and
sustained contract support.
There have been two unsuccessful attempts to establish contractor
support for conduct of a thorough SDLC, which is needed to plan and initiate a sound project to
comprehensively define immigration (and labor) process and support system requirements and to
develop, implement and operate the new LIIDS.
There have been local and Federal
political
pressures for results, which have driven the project toward establishing the limited initial capability
as a priority, leaving less time for the conduct of a proper SDLC.
Many of the existing CNMI immigration (and labor) processes are ill-defined, if at all.
Very little
automated data processing has ever been employed and there is limited integration of processes. The
Project Team understands that these need to be comprehensively defined in conjunction with the
immigration and labor operations managers and specialists who are the users.
There
is strong
commitment fi'om the CNMI Government managers and key personnel to define their fiinctional
processes, reorganize them into more effective ones and take the steps necessary to develop improved
procedures, forms, and the associated LIIDS support. A copy of The Labor Permit Application
Process document, prepared by the Labor component of the LUDS Project Team, was provided as
an example of process analysis and redefinition to be undertaken by the Project Team and related
operational managers. The goal will be an integrated immigration and labor control and facilitation
process, with LEEDS as the automation support tool.
The CNMI has not adopted or developed a SDLC process of their own.
It was planned that the
contractor would introduce the SDLC process, along with the system they were to develop.
That
did not work. INS has now provided the CNMI Project Manager with a copy of INS SDLC, for their
adoption.
The INS SDLC
is comprehensive and should provide a good education tool, as well as
reference document to be employed for the Commonwealth.
Recommendations
The CNMI Project Manager must be given the authority to go with the responsibility.
INS IRM
recommends emphasis first be placed on establishment of a complete project plan. The plan should
include the definition of the Project Manager's responsibility, reflect SDLC tasks and schedule, and
clearly identify required support actions firom budget and finance, procurement and other identified
organizations (CNMI and Federal).
CNMI and DOI must commit priority support to the plan and its component tasks.
INS should continue to provide consultant support
Much of the INS support ^.vill take place through
the on-site INS Officer.
Support to LIIDS development should continue to be direct between the
316
42
CNMI PrograiTi Manager/Team and INS Headquarters IRM. Comprehensive project reviews should
take place quarterly.
317
A3
EXECtrTIVE OFFICE FOR UNITED STATES ATTORNEYS
CNMI
Report
The United States Attorney's Office
("USAO")
in Saipan now has
two full-time attorneys
(previously it had only one)
.
In addition
to handling criminal and civil cases,
including appeals,
the USAO
provides
temporary
space
for
TDY
investigators,
task
force
personnel
working
on
federal
matters,
TDY
attorneys
from
the
Department
of Justice,
the United States Department
of Labor,
and
the National
Labor Relations
Board.
The
USAO presently has
only
one
secretary,
who
performs
both
administrative
and
secretarial
duties,
and
it
is currently trying to recruit
a second secretary.
The
USAO
is
continuing
to
respond
to
the
build-up
of
investigators
resulting
from
the
federal
law
enforcement
initiative.
These include one additional FBI agent,
one DEA agent
who has been assigned to spend a significant portion of his time in
the CNMI,
regular TDY visits from United States Postal Service and
Secret Service agents stationed in Hawaii,
ATF agents stationed in
Guam,
two Fish and Wildlife agents stationed
in Guam,
and one on-
island
United
States
Customs
officer
assigned
to
task
force
and
educational
duties.
One
officer
from
the
Immigration
and
Naturalization Service has been designated for full-time duties in
the CNMI.
In addition,
the United States Marshal Service has added
one additional
full-time deputy
(for
a
total
of two Deputy United
States
Marshals)
to
handle
the
increased
movement
of
federal
prisoners and to aid
in security duties.
The
immediate
and
expected
result
of
the
federal
law
enforcement initiative has been to increase the number of criminal
cases.
In the first five months of Fiscal Year
(FY)
1996,
the USAO
has filed almost as many new criminal cases,
12 cases filed against
22 defendants,
as were filed in all of FY 1995,
where 14 cases were
filed against
19
defendants.
Criminal
matters
(agency referrals
under
investigation)
have
risen
with
the
number
of
new
agents,
reaching 21 matters against
3
defendants in the first
5 months of
FY
1996,
compared with
22 matters against
21 defendants
in all
of
FY
1995.
On the
civil
side,
in the
first
5 months
of
this
year,
the USAO has filed or answered in
3 cases and received 15 matters,
compared
with
filing
or
answering
in
10
cases
and
receiving
11
matters
in FY 1995.
Most
of
the criminal cases have been resolved through guilty
pleas or other dispositions.
A recent example
is an international
drug
trafficking
case
involving
five
defendants
of
various
nationalities
that was investigated by the
FBI,
DEA,
and the CNMI
Customs agency.
Other examples include two DEA- investigated cases
involving conspiracy to possess and distribute methamphetamine,
as
well
as
several
United
States
Postal
Service- investigated
cases
involving
postal
burglary,
mail
theft,
and
obstruction
of
the
mails.
Presently,
all
federal investigative agencies
in the
CNMI
have
ongoing
investigations,
including
white
collar
crime
27-245 0-96-11
318
investigations
for
which
indictments
are
expected
in
the
near
future
Finally,
both
FBI
and
DEA
are
forming
joint
task
forces
involving Guam police officers who are specially designated as DEA
agents,
as well as involving local
ca>IMI officers from all branches
of
CNMI
law enforcement,
including
customs,
immigration,
and the
Department
of
Public
Safety.
These
task
forces
are
designed
to
enhance
federal/local
coordination
and
consultation,
and
to
increase the number of prosecutable cases by the USAO.
319
45
UNITED STATES KARSHALS SERVICE
Thfl
rTTirm;7rr«»ltt' °^
*-^^ Wortham Mariana lalandn
Status Report
March 20,
1996
ISSUE:
A significant Federal
law enforcement and prosecutorial
initiative
is underway
in the Conunonwealth of
the Northern Mariana
Islands
(CNMI)
.
Saipan,
Rota,
and
Tinian are
the three
islands that comprise
the CNMI.
The U.S.
Marshals
Service
(USMS)
office
is located on Saipan.
The
initiative
is principally funded by the Department of
Interior
(DOI)
and
involves
the Department of Justice
(DOJ)
,
the Department
of Treasury,
.md the
Department of Labor as
its principal participants.
The chief
targets
of
the
initiative are participants
in,
and perpetrators
of,
labor and immigration
crimes
in the CNMI.
A major segment of
the effort
involves
the investigation,
apprehension,
and prosecution of drug traffickers and violators who are
integrally involved
in the labor and immigration crimes being addressed.
HUMAN AND MATERIAL RESOURCES:
The USMS currently has one additional,
DOI
funded,
deputy U.S.
marshal
(DUSM)
in place on Saipan.
The position was approved and funded to enable
the USMS
to meet
tne
increased Service requirements generated by the initiative,
which
have materialized as originally projected.
Thus
far,
the addition of
the DOI
funded DUSM position in Saipan allows
the
Marshals Service
to adequately address
the actual
increases
in requirements
that are currently being generated.
Absent
the DOI
funded position,
however,
the Marshals Service would be signif icemtly constrained from providing the
level and quality of services USMS customers
in Saipan deserve.
As
the
initiative
increases
in prosecutorial
speed,
projections
indicate
that USMS
requirements will
increase commensurate with prosecutorial
cases.
Therefore,
the
funding levels,
which were originally obligated for
the
placement of
a second DOI
funded DUSM position in Saipan should be continued
for
the duration of
the
initiative.
In addition,
increased workload levels
will
require either an additional
$65,000 a year for anticipated contract
guard service or
a third DUSM position.
Contract guards will
be used
to
assist USMS personnel
in courtroom prisoner productions,
prisoner movement,
and prisoner custodial
requirements.
On a yearly or short-term basis,
the
anticipated increase
in Service requirements can be adequately addressed
through the contracting of
"guards"
to support
the
two DUSMS currently
positioned on Saipan.
Absent
the additional
"guard"
hire
funding,
one
additional or a third DUSM position will be required.
DETENTION SERVICES:
On this
issue,
the initiative's partners strongly concur
that
a major
intervention
is required
to provide Saipan with an adequate detention
facility.
The USMS currently has
6
Federal prisoners
in custody in the Northern
Marianas.
Those pt > c oners are housed
in
a detention facility managed by the
CNMI Department
of Corrections on Saipan.
The facility does not meet Federal
stcindards and
is
in danger of being shut down by the Federal Courts.
The
existing
facility houses approximately 170
inmates
including
females and those
charged as
DUIs.
Several concerns must
be
faced:
the facility has serious
security problems;
it
lacks
interview rooms;
it
is without medical
facilities;
320
46
it uses temporary hoses
to supply water to baths;
cell cots are constructed of
smoothed down concrete block;
and there are no toilets
in individual
cells.
Furthermore,
a
$40 million dollar territorial courthouse
is under construction
(across
the street
from the detention
facility)
.
This new courthouse facility
will probably result
in increased prisoner activity,
straining an already
inadequate detention facility.
The USMS has made arrangements with the Department of Corrections
in Guam to
provide bed space
for CNMI
Federal prisoners under
a cooperative agreement.
A
92-bed pre-fab detention facility
is currently under construction
in Guam.
The Federal Courts
in CNMI have agreed to allow video-conferencing between
CNMI prisoners housed in Guam and attorneys located in Saipan.
Housing
Federal prisoners
for the CNMI
in Guam,
however,
is only a temporary solution.
The USMS supports
the National
Institute of Corrections proposal
to replace
the existing detention facility on Saipan;
CNMI
is
in need of
a 200-bed
detention facility to replace
the existing substandard facility.
It
is
recommended,
however,
that controls
be put
in place to limit
the use
of
funds
solely for
the detention facility construction.
The USMS would require
4-6
beds
for Federal prisoners
in a new CNMI detention facility in Saipan,
and
would no longer require bed space
for prisoners
in Guam.
SDMMARY!
The USMS
requires continued funding
for two
(2)
FTE deputy U.S.
marshal
positions on Saipan.
In addition,
either $65,000 will
be needed for contract
guard service or one additional DUSM position will
be required
to meet
increased workload requirements
321
Memorandum
.^^E^^
47
REPORT TO DOI
FROM CRIMINAL SECTION,
CIVIL RIGHTS DIVISION
APRIL
3,
1996
Since the
inception of the CNMI/DOI
initiative,
the
Criminal Section of the Civil Rights Division has been
prepared to review any and all allegations
of potential
violations
in the CNMI
of the federal criminal civil
rights
statutes.
Our Section's efforts
in pursuing potentially
prosecutable criminal civil rights matters were dependent on
first
learning of allegations
of such violations,
and on
having an assigned case agent
of the
FBI on-island with whom
we could work on criminal civil rights matters.
The FBI's assigned agent arrived
in the CNMI
in
October,
1995.
As we awaited his arrival
there,
we also
wrote to several persons with whom our colleagues
in the
Employment Litigation Section had had contact during their
work
in the CNMI
(the
litigation culminating
in United
States
V.
The CNMI
et
al.
.
civil
litigation brought
on
behalf
of Philippine national educators who had suffered
racial discrimination
in the CNMI
school district)
in order
to solicit any allegations
of which they might
be aware
which could
implicate the federal criminal civil rights
law.
Despite these efforts,
we have
learned
of only one
incident
for which full
investigation could
be authorized;
that
matter
is currently under investigation by the
FBI
in the
CNMI
and concerns allegations
of excessive
force used
by
officers
of the Department
of
Public Safety on Rota.
In order
to
increase this Section's ability
to review
allegations
of potential criminal civil rights violations
in
the CNMI,
we have now instituted
a plan by which this
Section will
be made aware by the
FBI
not only of those
allegations which,
according
to on-island review,
may
warrant
investigation as
a violation of
the
federal criminal
civil rights
statutes,
but also of any and every
inquiry
received
by the
FBI
from any source since the arrival
of
the
assigned agent
in October,
1995.
In this way,
we hope
to be
able
to bring
to the review of such allegations
not only the
investigating agent's expertise,
but also the criminal civil
rights attorney's evaluation
of those allegations which
could,
by
further
investigation,
lead to the discovery
of
a
48
prosecutable offense.
We will obtain that material and
review
it,
and will have obtained and evaluated the
investigation report
in the excessive
force incident
described above,
by the end of May,
1996.
At that time
(in
late May/early June)
,
a Senior Criminal Section Attorney
will travel to the CNMI to discuss with the FBI agent and
with representatives of the United States Attorney's Office
the material we will have reviewed and we will conduct
further investigation toward preparing any suitable matter
for grand jury presentation.
If by the date of that trip
there still does not exist
a potentially prosecutable
allegation,
the Section Attorney will work with the agents
and Assistants
in the CNMI on doing additional work
in order
to
learn of a prosecutable allegation.
At this time,
because the Section's work on- island has
not yet taken place,
we have no funding recommendations to
make.
Also,
because our work concentrates on the
investigation and prosecution of federal criminal civil
rights violations,
we have no specific responses to the
issues outlined
in Director Stayman's
letter.
323
49
fEPgRAL BUREAU 07 TNVESTTGATTOW
The Pedexal Bureau «f Investigation
(FBI)
entered into
an agreement vith the Departnent of Interior to provide
additional law enforceaent support for the Comaonwealth of the
Northern Kariana Islands
(CNHI)
The FBI had two Special Agents assigned to the CNMI who
are dedicated to investigating violations of federal criminal
statutes,
including,
but not limited to, public corruption,
organi2ed crime/drug matters and white collar crime offenses.
As
a result of the initiative,
the FBI assigned an additional
Special Agent to the Saipan Resident Agency, which brings the
total staffing of the Saipan Resident Agency to three FBI Special
Agents-
The criminal investigative priorities of the third
Special Agent will be the investigation of civil rights,
public
corruption and organized crime matters.
The FBI has initiated contacts with various community
support groups and local
law enforcement agencies and has advised
them of the scope of the federal interest in civil rights
matters.
This liaison has resulted in the increased awareness of
the nature of these crimes and several specific inquiries have
been directed to the local office.
The FBI continues to receive
inquiries in this area and will promptly examine the facts and
circumstances and advise the U.S. Attorney's Office and the
Criminal Section of the Civil Rights Division.
Department of
Justice to determine the liXelihood of federal criminal
prosecution and,
when warranted,
will investigate any and all
credible allegations of violations of federal civil rights
statutes.
The FBI has also met with the Coamissiener of the
Department of Public Safety who has offered his «.gency's full
support and assistance
in the investigation of civil rights
violations involving members
of the Department of Public Safety.
And,
the Commissioner
is implementing plans to increase and
improve the Civil Rights training for
CJJWl public safety
officers.
Vith the increased presence on Saipaui of ether Federal
law enforcement agencies,
other criminal matters which usually
come to the attention of the FBI are being referred to these
agencies.
Accordingly,
the FBI has been able to concentrate
its
efforts
in the investigation of
trtiite collar,
organi2ed
crime/ illegal drugs,
public corruption and civil rights matters.
This concentration of investigative expertise to these areas has
recently resulted
in the prosecution of several members of a
major drug trafficicing group with Japanese organized crime
connections-
The investigation and subsequent prosecution was
made possible by the coordinated effort between the U.S.
Attorney's Office,
FBI,
Drug Enforcement Administration,
Biireau
of Alcohol,
Tobacco and Firearms.
U.S. Marshal's Service,
and
324
50
local lav enforceaent.
As
a result,
other major cases vill be
handled utilizing the tas)c force concept.
At this tine,
established funding levels are sufficient
to address current investigative needs.
325
51
CHILD EXPLOITATION AND OBSCENITY SECTION
STATUS REPORT ON CNMI
INITIATIVE
This
is
the
first
report
of
the
Child
Exploitation
and
Obscenity
Section
(CEOS)
of
the
Department
of
Justice
for
the
Federal Task Force on the Federal-CNMI Labor,
Immigration,
and Law
Enforcement
Initiative.
The
CEOS
has
the
supervisory
responsibility
for
federal
statutes
covering
obscenity,
child
exploitation,
child
sexual
abuse,
and
activities
under
the
Mann
Act.
Mann
Act
statutes
include
the
interstate
or
foreign
commerce
aspects
of
criminal
sexual activity involving:
a)
the transportation of an individual,
b)
the
persuasion,
inducement,
enticement
or
coercion
of
an
individual
to
travel,
c)
the transportation of
a minor,
or
d)
travel by an individual for that purpose.
CEOS
is interested in
prosecuting
individuals
who
transport,
or conspire
to
transport,
young women
to the
CNMI
for purposes
of
criminal
sexual
activity,
including but not limited to prostitution.
CEOS
is also interested
in the prosecution of individuals who travel
to the CNMI
to engage
in
criminal
sexual
activity,
including
but
not
limited
to
prostitution
As
a preliminary step
to undertaking prosecutions,
we have
been
conducting
extensive
interviews
with
federal
government
personnel
in
both
the
CNMI
and
Guam.
The
interviewees
have
included representatives
of
the Departments of
Interior,
Justice,
and
Labor,
many
of
whom
have
provided
information
regarding
the
transportation
of
women
and
travel
to
meet
women
in violation
of
the Mann Act.
Each interviewee has provided different perspectives
on
the
breadth
of
this
problem
and
the
resources
which
will
be
necessary
to address
it.
CEOS
expects
to
complete
the
preliminary
phases
of
this
project within the next
few weeks.
At that time,
CEOS will develop
a strategy to initiating investigations
leading
to prosecution of
the
individuals
organizing
these
criminal
activities.
CEOS
has
been
assured
that
resources
will
be
made
available
within
the
Department of Justice to assist in the cases.
Our present concerns
are
leads
for
the
initial
cases,
focusing
particularly
on
young
victim witnesses.
CEOS
looks
forward
to
continued
work
with
the
Federal
Task
Force on
the
Federal-CNMI
Labor,
Immigration,
and Law Enforcement
Initiative
326
U.S. Department of Treasury
United States Secret Service
United States Customs Service
Bureau of Alcohol, Tobacco, and Firearms
52
327
53
DEPARTMENT OF THE TREASURY
UNITED STATES SECRET SERVICE
March
20,
1996
Department
of
the Interior
Office
of Territorial and International Affairs
1849
C street,
NW
Washington,
D.C.
20240
ATTN:
Debbie Subera-Wiggin
Dear Ms.
Subera-Wiggin:
Reference
is made to the correspondence
of Director Allen
P.
Stayman,
Office of Insular Affairs,
dated March
8,
1996,
in which
his
intention to provide Congress with
a brief report regarding
enforcement efforts
in the
C>fMI
is discussed.
None
of the specific
issues outlined by Mr.
Stayman directly
correlate with the primary investigative responsibilities
of the
United States Secret Service.
However,
we believe that our
previously submitted quarterly reports provide
a good overview of
the Service's accomplishments
in the CNMI,
both
in the
enforcement of our core violations and as
an active participant
in the CNMI
Interagency Task Force.
The information presented below will update your office on Secret
Service efforts
in the CNMI during the period of December
15,
1995,
through March
15,
1996:
For most
of the first quarter of this year,
we were
able to provide
a full time presence
in Saipan.
During
this period.
Special Agent J.
DeSantis participated in
two major task force investigations which culminated
in
three arrests.
The first investigation resulted
in the arrest of an
individual for violations of
18 USC 1344
(Bank Fraud)
,
18 use
1702
(Obstruction
of Justice)
and
18 USC
1708
(Theft of Mail)
The other significant investigation resulted
in the
arrests
of two individuals for violations
of Title
21,
Section
841
(Possession with Intent to Distribute
Dangerous Drugs)
and Title
211,
Section
860
(Manufacture or Possession of Dangerous Drugs On or
Near
a School)
328
54
Page
2
Three bank fraud referrals have been received
from the
Bank of
Guam,
and are being investigated by one or our
agents who returned to Saipan on March
12
(he will
remain
at
least until April
5)
.
During that time,
he
will
be presenting
a case
for prosecution
to AUSA Fred
Black;
will conduct Secret Service business,
and will
participate
in Interagency Task Force efforts.
In terms
of our view of
future participation
(which you
requested)
,
it has been our experience that the number of
violations directly impacting upon Secret Service jurisdictional
responsibility do no justify
a full-time presence on the
island.
In this
age of
limited resources,
we would normally rotate an
agent though Saipan some two weeks out
of every two month period,
deploying that agent to other regions
also demanding some
Secret
Service presence.
However,
we will continue
to participate
in
Task Force efforts and to support the Federal-CNMI
Labor,,
Immigration and Law Enforcement Initiative
to the extent
possible.
Should you have any questions or require additional
information,
please
feel
free
to contact Assistant Special Agent
in Charge Ray
Dineen of this office at
(202)
435-5716.
^aul
A.
Hackenberry /
Assistant Director of
Investigations
329
55
DEPARTMENT OF THE TREASURY
U.S. CUSTOMS SERVICE
HONOLULU. HAWAII
March
20,
1996
Mr. Allen
P.
Stayman
Director
Office
of Insular Affairs
U.
S.
Department of
the
Interior
Washington,
D.
C.
20240
Dear Director Stayman,
In response to your letter dated March
8,
1996,
requesting an
overview of our agency's
activities
in the
CNMI,
enclosed please
find
a summary of action taken
to date
as well
as
an assessment
of
future needs
to continue our role
in the CNMI
initiative.
For
your information,
the
U.
S.
Customs
Service,
Office of
Investigation,
has had TDY representatives
on site
in Saipan
since October
1995 when our agency first received funding from
your Department.
U.
S.
Customs
has been the impetus
in establishing
a
U.
S.
Treasury Task Force in the CNMI.
The Task Force will consist of
one or
two
U.
S.
Customs Special Agents and officers
from the
CNMI Department of
Pxiblic Safety
(DPS)
and CNMI Customs.
Other
Treasury agencies
(BATF and U.
S.
Secret Service)
will be
represented on an
"as needed" basis.
Space has been Identified
and modifications
are currently underway on the 4th Floor of the
Horiguchi Building
to house
the Task Force members.
In November
1995,
Memorandums
of Understanding regarding the assignment of
CNMI
law enforcement officers
to the
Taslc Force were
s\ibmitted to
CNMI officials.
To
date,
these MOU' s have not been signed as
they are currently under review by the CNMI Attorney General
The primary objectives
of
the
U.
S.
Customs Service
in the CNMI
initiative
include:
1.
Investigation of illicit drug trafficking across
the CNMI
border,
both import and export.
The
international
airport,
seaport,
U.
S.
Mail
and courier services will be targeted.
2.
Investigation of violations of the Arms Export Control Act,
Bank Secrecy Act and applicable money laundering statutes.
3.
Investigation of
the
illegal transhipment of textiles
from
the garment
factories.
4.
Gather and report violations of CNMI and USCS
laws
and
REPLY TO: SPECIAL AOCNT IN CHAROE. P.O. BOX SOlO*. HONOLULU. H<
330
56
regulations
that will result
in effective prosecution before
the
courts of the United States
and the CNMI.
Since October
199S,
a total of ten investigations have been
initiated in support of our enforcement efforts
in the CNMI.
The
investigations have centered on violations of the narcotics
laws,
transit of suspected Japanese Organized Crime members,
importation of counterfeit
U.
S.
Currency,
and potential OFAC
violations.
To date,
these investigations have resulted
in the
arrests of
5 individuals
and the seizures of counterfeit
currency,
unregistered firearms and drug paraphernalia.
To help combat the drug and firearms smuggling activities of
Japanese Organized Crime,
the U.
S.
Customs Attache,
Tokyo
is
working with Japan's National Police Agency to
improve
coramunications and the exchange of information between Japanese
officials and
the
law enforcement agencies
in Saipan.
On January
22,
1996,
a NPA Detective Superintendent traveled from Japan to
Saipan.
to discuss current cases
in Saipan involving members of
the Japanese Organized Crime.
U.
S.
Customs
is sponsoring,
in conjunction with CNMI Customs,
a
training seminar March
22,
26 and 27,
1996,
at the Saipan Diamond
Hotel
for an estimated 150 local and federal
law enforcement
officers.
The seminar will be presented by a U.
S.
Customs
Senior Special Agent from the Federal Law Enforcement Training
Center in Georgia and will
focxis on safety and mental preparation
for armed confrontation in the law enforcement
field.
From April
8-19,
1996,
tJ.
S.
Customs
is sending a
four parson
training team of U.
S.
Customs officers from Honolulu,
Hawaii
to
work with the CNMI Customs Division.
The purpose of the training
team is
to
evaliuite,
train and to assist them in
the following
areas:
(A)
Airport operations,
passenger inspection and analysis of
airline passenger manifests.
(B)
Seaport operations
and cargo inspections
(C)
Canine operations
In October
199S,
U.
S.
Customs received S1S0,000
(combined from
FY 95 jmd
96)
in
funding from your Department.
To date,
approximately 5110,233
(73.5% of the available)
has been e.xpended
by our agency in support of
the project.
The major cost has been
for travel and per diem expenses
($102,304 obligated
to date out
of the budgeted $120,000
for the
year)
.
These costs add up
quickly when one considers
that they include
the rental of
vehicles estimated to be 528,300 per year and the daily per diem
331
57
amount of
5228.
Since one
agent has been detailed
to
the CNMI
since
December,
airfare charges have been minimal.
It
should be
noted though
that
at
the current
rate and without additional
reimbursements,
U.
S.
Customs will not be able
to
keep an agent
TDY
in
the CNMI
for
the remainder of
the
fiscal
year.
It
is
estimated that
an additional
525,000 will be needed
to
fund TDY
expenses
in
FY
96.
Attached
for your review
is
a current budget analysis
of
the
expenses
for the project
to
date.
The
travel expenses have been
obligated
for travel through May
9,
1996.
It should be noted
that
expenses
for
rent,
telephone
and utilities have been minimal
to date because
the commercial
space
is not yet ready for
occupancy.
It
is believed that
it will
cost approximately 51,000
per month
for
these
expenses,
primarily long distance charges
for
the computer linkage
to our main system.
Based upon current projections,
it
is believed that
U.
S.
Customs
will need approximately $180,000
to continue
the CNMI program in
FY
97.
With start-up costs
(such
as
furniture and equipment)
already taken care
of,
most
of the
funds
should be allocated to
keeping
an enforcement agent (s)
on site
in the CNMI
to work with
the
local
agencies.
Assuming that additional
funding becomes available
in FY
9"!,
Customs
is once again prepared to
support
the initiative with
temporary details
from Honolulu and Guam.
It
is believed that
more work can be done
to enhance the enforcement efforts
in the
labor area by concentrating on investigations of
the garment
industry and the
transhipment of textiles products through the
CNMI.
Customs and Immigration have historically worked hand in
hand
as
the
front
line of defense
to protect
the borders
from
people,
prohibited items
and merchandise injurious
to
its
citizens.
By going out
front with training this
fiscal
year,
it
is hoped that
the border process will be more efficient starting
in FY
97.
Although the
start of
the project was delayed due
to budgetary
concerns,
we
at
U.
S.
Customs
are committed to being
a long-term
player
in
the
ever-important
law enforcement
initiative
in the
Commonwealth of the Northern Marianas
Islands,
Please
feel
free
to contact our office
at
(808)
541-2623
if you have
any questions
or
if we
can be of
futher assistance.
Sincerely,
WALTER W.
COLLZTTE,
JR.
Resident Agent
in Charge
332
58
Bureau of Alcohol,
Tobacco and Firearms
Commonwealth of the Northern Mariana Islands
Activity and Funding Request Report
March
25,
1996
The following
is
an activity report regarding the
Commonwealth
of the Northern Mariana Islands
(CNMI)
for
the period January
1,
1996,
to present.
This report
is
being submitted to document the activity of the Bureau
of Alcohol,
Tobacco and Firearms
(ATF)
in the CNMI,
relating to the reimbursable support agreement between
ATF and the Office of Territorial and International
affairs,
United States Department of the
Interior.
This report
is also
for the purpose of transmitting
a
funding request for assistance provided by ATF to the
CNMI
over the next year.
ATF continues to investigate several matters
in the
CNMI.
Our agents
from ATF Field Offices
in Guam and
Honolulu have continued to provide assistance to the
CNMI over the
last year which has resulted
in several
cases targeting an armed career criminal,
numerous
armed drug traffickers,
and
a case which
is attempting
to determine the source of illegal explosives.
One case involves
a convicted felon who was found
in
possession of explosives
in the village of Af etnas,
Saipan.
The defendant was indicted on May
4,
1995,
for
possession of explosives and has pleaded guilty to this
same count on June
16,
1995.
As
of this date,
he has
not been sentenced due to his cooperation
in providing
additional criminal information to the Federal Bureau
of Investigation as part of his plea agreement.
As previously stated
in the last quarterly report,
a
subject who was found to be
in possession of
a pen gun
and ammunition on Saipan has not yet been indicted due
to an interstate commerce issue with the pen gun.
The
U.S.
Attorney therefore has tentatively offered
a plea
agreement to the defense with respect to not including
the armed career criminal statute to the possession of
a firearm charge.
Instead,
the U.S.
Attorney
is
offering
in exchange a guilty plea for a two year
prison term.
ATF
in Guam was recently notified that
this same sublet was arrested again on or about
March
8,
1996,
on Saipan,
for possession of another
firearm and ammunition.
333
59
This subject,
will be charged,
under the armed career
criminal statute
for this second incident.
Another investigation reported
in the
last update
involved an
individual carrying
or using
a
firearm
during
a drug trafficking offense.
This case
is
continuing.
Three Japanese nationals were recommended for
prosecution after their arrest on Saipan
for possession
of firearms and narcotics.
The prosecution in this
case
is pending while court records and fingerprints
from
a previous conviction are being obtained from a
foreign court through Interpol.
Another
individual
found
in possession of
a firearm on
Saipan
is to be indicted some time
in March
1996.
This
case also involves the armed career criminal
enhancement.
The multi-agency task force investigation
is still
continuing which
is targeting
illegal narcotics
traffickers
in the CNMI and
it
is anticipated to last
several months.
ATF continues to trace firearms recovered by the CNMI
Department of Public Safety,
and all investigative
leads are being pursued.
Plans are still under way for ATF to conduct a two week
undercover and tactical training session
in Guam during
FY
96.
This training and funding are being arranged
through ATF training at the Federal Law Enforcement
Center
in Glynco,
Georgia.
/'
ATF continues to be
a vital participant
in the Inter-
Agency Task Force and
in February attended the
Department of Interior meeting on Saipan concerning
CNMI.
ATF has also met with the Japanese Police and Customs
concerning firearms trafficking between Guam,
Saipan
and Japan.
FXJNDING PROPOSAL
Our agents have provided increased assistance to CNMI
law enforcement officers
in the area of criminal
investigation and training.
334
60
Additional funding will allow the agents and task force
officers
in Guam and Honolulu to continue their
assistance to the CNMI,
with emphasis on training and
liaison.
Our plans
for the next year include the addition of an
investigative assistant to the Guam Field Office which
will help allow our agents
in the
field to spend more
time on developing criminal
investigations.
Investigations
into armed career criminals and armed
drug traffickers will continue with the assistance of
additional funding for evidence purchase and
subsistence
for confidential
information.
Additional
funding will also
be used
to purchase electronic
surveillance equipment,
video surveillance equipment,
and cellular telephones.
A leased vehicle will also
be
needed.
Funding will be needed
for agents and
technical
staff to travel from Guam,
Hawaii,
and the
continental
U.S.
to perform duties
in the CNMI.
Training will be
a priority over the next year with ATF
planning to train CNMI
law enforcement officers
in the
areas of firearms trafficking investigative techniques,
interviewing and interrogation techniques,
arson-for-
profit investigations,
post bomb blast scene
investigative techniques,
undercover techniques,
and
operational security techniques.
Finally,
funding will also be needed for office
equipment to include
a desk-top computer,
monitor,
printer,
and associated software.
This list also
includes
a typewriter,
transcriber,
and calculator.
The estimated cost to carry out these plans
is
attached.
61
Appendix C
CENSUS
336
CNMI 1395 Mil) PgCADF CFNSU.S OF POPULATION AND MQUSINQ
PREUMINARY RHPORT
62
I
Ocnrral
I.ToUl
Saipsn
Rota
Northom Islands
2a. Houiing Unit* PopulaUon
Saioan
Tinian
Rota
Norit^em Islands
2b. Group QuarUrt Population
Saipon
Tin Ian
Rota
Northom Intends
337
63
2.C1IEENSH1E
59,913
4^,U5
Cmren Of National
27,512
20,052
Bom in tho CNMI
21,721
13,752
Bom in the U.S. Of othae U.S.
TanHory or C<immonw*atth
4.4 18
2.403
Bomabro«<J, U.S.parBnt(3)
239
237
Natura/lzad Citizan
1,134
603
Not » Cifaan Of National
32,401
23,263
P»finan4nt Rd&id«m
3.S32
2,153
Temporary Rosldont
28.8«8
21.075
38J'X
100.0%
100.0 V.
37.0%
45.9%
48.3%
29.7%
38.3%
3a.fi%
M.7%
0.8%
64.8%
39.3%
61.4%
37.0%
7.4%
0.4%
1.9%
54.1%
5.9%
43.2%
3.5%
0.5%
1.6%
53.7%
5.0%
4S.6%
B n«ra|
1. Total Housing Units
Saipan
Tinian
Rata
Nodti«m tetand?
2a. Houaina Units Occupied
.
Saipan
Tiruan
Rata
Normvn Islands
2b. Houjting Unita Vacant
Tinian
Rota
NonhAm Isla/vds
li.SU
338
64
Appendix
D
CNMI Support for
Minimum Wage Increase
339
-^
^...^tttut^r uj %^otnmerce
P.O. Box 806 CK Saipan MP 96950
•
family Building
Suite 104 Garapan
December 26, 1995
Governor Froilan C. Tenorio
Commonwealth of the Northern Mariana Islands
Capitol Hill
Saipan MP 96950
Dear Governor Tenorio:
The Joint (1995 outgoing and 1996 Incoming) Board of Directors of the Saipan
Chamber
of Commerce
met
leist week and
discussed
the
current
issue
of
postponement of the next increase of the minimum wage which we understand
is
before you now for signature or veto.
The Chamber would like. to take this opportunity to again reiterate its position
in
support of the current existing law which calls for an automatic and annual increase
In the minimum wage.
Supporting an increase in the owt of doing business may
seem odd coming from the business sector, however the Chamber took, the stand to
support this legislation at the time of its implementation, and continues to stand
behind that decision.
It Is a mattJfrtjf-honorTTnteg^ty and standing by our colLective
word as a^ommonwealth.
'^
wicondly,
the CMMI currently
cottrts a reptSatlon of insubility with investors,
which
is keeping needed development
at
baftr and Worse, redirecting potential
investment
to
other
destinations','such as Palgu and Southeast
Asia.
Another
"switchback" such as
this, in the .'operational regulations of business in the CNMI
will only credit these adverse pefccptions and b^ter the perceptions of barriers to
investment in the CNMI.
4
1
The Chamber, on behalf of the buStness-sectOTT-m^ you to give serious
consideration to maintaining the current law in force. Should you
have any
questions, the SCC stands by to assist in any was possible.
Sincerely,
Efrain F. Camacho
Chairman of the Board
for the Board of Directors
65
P>to«e: Oil (670) }3}-7l!0
Fax: 011(670) 2ii-7lSl
340
lOTEL
TSSOCIATION
^^
ORTHERN
Tar IANA
SLANDS
P O. Sox 5075 CHRB. Soipon. MP 96950
Isf (470) 2M^»U9
Fox; 2M-8799
February 6th 1996
Jack Torres,
Chairman,
Wage and Salary Review Board,
Saipan, O^MI.
Dear Qiairman Torres,
As president of the Hotel Association of the Northern Mariana Islands, I received your
letter and questionnaire of January 3 1st.
Please find below the Associations answers and
comments. We would like to thank you for the opporninity to comment and would like
you to take these comments into consideration with the testimony already given on
November 17th 1995.
1
Each industry was asked this question before the current law was passed and the Hotel
Association stands by its original objective of increasing the minimum wage to S4.25
over several years at S0.30 per year unless there is a major turndown in business.
2. A tiered wage system will be seen as unfair by employees of those industries whose
minimum wage is lower. Also
it will lead to some industries bargaining for lower
increases. One policy for ail would be die most fair.
3. Wages can be linked to skill levels or to productivity targets and all these factors
should be left to the individual companies to decide whai is best for them. However there
should be a minimum level below which employers are not able to pay.
In a free market
economy the wages should be left to market forces, except for the minimum wage, to stop
unscrupulous employers taking advantage. As to whether the increase in the minimum
wage is required to remain politically correct,
if the CNMI wants to continue to depend
on the US for financial and other suppon,
it seems,
it will have to listen to their
recommendations.
4.
In a service industry labor is not a factor of production
it is the major expense.
It
needs to be balanced with other costs.
It varies from industry to industry and company to
company.
./-»*.. r-j^ni /T^o/T/, Pnint o^«vT
. Dfii.irN Uotal • HafaeJal Baocfi Holat
341
labor willing to work at the wages and salaries offered then there is no need to increase
the pay. A legislated increase in the minimum wage will ensure an increase.
1
1
Tourism could easily grow to replace some of the garment industry. The demand for
tourist destinations from Asia is increasing at a fast rate. The location of the CNMI
combined with its favorable climate and natural beauty makes
it an ideal place for
vacations.
A more stable political environment and clear laws on land leases would help
in making the CNMI more attractive to investors. The CNMI must get ready to live
without a garment industry. Marine enterprises and research potentials are some possible
replacements. The reef and ocean are incredible sources of new products from medical to
cosmetic to household uses. Our goal should be to encourage scientific and industrial
exploration while maintaining sufficient environmental controls for protection.
12. We need to keep up with the increase in the cost of living and gradually increase to a
minimum wage which
is nearer Guam's and the rest of the developed world.
13.
If
the US Minimum Wage was 58.46 per hour unemployment would probably be
higher and more people would have less than they have today.
Price.'; would have to
increase or service levels cut back. Both could have the negative effect of reducing the
number of visitors to the C>fMI.
In conclusion, HaNMI submits to the Board that the present minimum wage law should
remain as
it is. with gradual increments that allow the necessary time to adjust our
bu.sinesses. to increase our productivity and to make the pay increases without damaging
the service to our customers.
cv^
Clifford Graucn.
President HaNMI
'M-
342
w.tiiii v>uixifiAUiUKb ASSOCIATION
P.O. SOXS52CHRB. SAIPAN. MP 969S0
- TEL. 322-9039'
2-13-96
CONTRACTORS ASSOCIATION SAID YES 1
FOR YEARS
Dear Editor:
After
seeing
some
of
the
wage
items
in
your
paper,
and
hearing
comments
about
why
the
C. N.M.I.
CONTRACTORS
ASSOCIATION
didn't
show
up
for
the
Wage
Board's
hearing,
I
would
like
to
dig
back
a
bit
and
present
the
facts
on
this
issue.
Minimum
wage
has
been
a
part
of
the
Association's
agenda
for
years,
and
recommendations
have
been
plentiful
and
consistent
throughout
those
years.
There
has
been
support
for
an
increase
at every gathering.
To
take
just
the
last
three
years,
and
only
a
few
of
the
examples,
consider
the
following items.
1.
The
C.N. M.I.
CONTRACTORS
ASSOCIATION
was
asked
in
January
of
1993
to
again
come
up
with
our
recommendation
for
a
wage
increase.
(One
of several
times over
the
years)
Our
suggestion
was
to
raise
the
wage
to
$2.50
in
1993,
53..25
in
1994,
S4.00
in
1995,
and
match
the
U.S.
Minimum
Wage
in
1996.
With
this
we
requested
that
all
benefits
be
considered
for
an
acceptable
deduction
from
this
wage
because those
items
ad considerably
to
the basic wage.
2-
In
April
1993
we
submitted
documents
showing
that
based
on
5000
workers,
a
raise
of
$1.50
per
hour
would
generate
an
additional
$15,600,000
per
year
in
taxable,
expendable
income
for
contract
workers,
and
outlined
how
thi.s would help boost
the economy.
3.
Again
in
April
1993,
we
submitted
our
comments
to
th«
Senate
that
we
were
apposed
to
S.D.
8-146
to
immediately
raise
the
wage
to
U.S.
Minimum,
but
fully
supported
S.D.
8-197
for
a
gradual
increase.
We
also
gave
our
support
to
the
comments
of
Mr.
Kloy
Inos,
Director
of
Finance
and
Chairman
of
the
Task
Force
on
Miiixinum Wage.
4.
Ir.
May
of
1993,
the
C.N. M.I.
CONTRACTORS
ASSOCIATION,
out
of
total
frustration
with
the
local
governments
complete
inaction,
sent
Mr.
Herman
Guerrero
and
myself
to Washington
D.C.
to voice our opinion
on several
issues,
including
Minimum
Wage.
We
told
the
people
we
met
with
that
our
group
had
tried
for
eight
years
to
get
an
increase
pushed
through,
and
that
we
still
supported
343
a gradual
increase
in
the
wage
up
to
U.S.
Minimum.
5.
In
our
trip
report,
published
in
the
Variety
on
May
21,
1993,
we
again
stated
that
an
increase
was
needed
and
overdue.
It
was
agreed
that
the
mora
wc
pay
our
workers,
the
more money
there will
be
to circulate through
the economy.
6.
On
August
11,
1993,
Governor
Guerrero
asked
our
Association
to
again
participate
in
a
Wage
and
Salary
Review
Board,
and
I
appointed
Mr.
Richard
Szumiel
to
this
post.
As
of
January
19,
1994,
this
board
had
met
only
twice
under
Chairman
David
Sablan.
He
was
faced
with
trying
to
gather
and
administer
a
board
that
had
no
funds
for
an
office,
supplies
or
even
to
fly
in
the
Tinian
and
Rota
members.
Additionally,
Governor
Tenorio
reported
positions
to
the
media,
and
presented
Speaker
Diego
Bcnavente
with
a
proposed
bill
regarding
minimum
wage
without
even
providing
a
copy
to
the
Board,
much
less
any
input
they
were
there
to
give.
Still,
at
that
time,
all
the
associations
on
the
island
agreed
to
the
gradual
increase.
7.
On
February
2,
1994,
the
Variety
again
carried
the
C.N. M.I.
CONTRACTORS
ASSOCIATION'S
backing
of
the
law
stating
a
yearly rise
in wages until we reach U.S. Minimum
Wage.
At
Lhat
time
we
also
stated
that
we
had
always
supported
a
much
quicker
increase,
yet
since
there
was
agreement
with
all
sectors,
*nid
the
law
was
in
place,
we. voted
for
status
quo.
We
also
said
if
the
wage
was
to
be
raised
to
the
U.S.
Minimum
immediately,
that
we
would
support
it with,
again,
some
discussion
on
benefits
given
to
contract
workers.
Whatever
the
wage
rate
or
law
or
changes
made,
we
felt
it
important
not
to
have
to
change
it
again
down
the
road.
(Exactly
what
just
happened!)
Too many changes
just ad
to
the already obvious
indecision
of
the government,
and
a climate of instability
for
investors.
This
appearance
of
instability
is
what
we wanted
to avoid by having a workable wage
law.
8.
On
November
15,
1994,
the
Variety
again
published
some
of
our
thoughts
on
wages.
The
wrath
of
the
U.S.
Congress
was
upon
us,
and
I
stated
that
had
we
paid
and
treated
contract
workers
the
way
we
should
have,
there
would
have
been
no
complaints
and
Congress
would
have
no
reason
to
look
over
our
shoulders.
And,
once
again,
we
were
asked
our
position
on
wage
increases
and
once
again we
said
YES!
RAISE THE MINIMUM WAGE!
9.
On
December
2,
1994,
I
was
as/ccd
to
meat
with
Scn«tor
Hocog
to
discuss
S.B.
9-142,
to
increase
the
minimum
wage
to
S1.2S
per hour
by July
1995.
At
that
time
I
showed
hira
realis tic
figures
of
how
little
the
negative
impact
could
be,
and' hou
tremendous
the
positive
impact
would
69
344
be
if
this
happened.
And
again
told
him
if
this
is
what
70
will
happen,
we
will
support
it.
Our
concern
was
still
regarding
all
the
additional
costs
and
benefits
involved
and
how
to
set
a
fair
standard
for
deductions
of
these
costs.
It
was
made
very
clear
that
we
would
live
with
whatever
the
wage
would
become
if
we
could
work
that
out,
and,
most
importantly,
IF
THEY
WOULD
STOP
CHANGING
THE
LAW ALL THE TIME
1
10.
On
December
26,
1994,
we
submitted
to
Speaker
Benavente
our
comments
on
H.B.
9-272.
This
was
more
panic
legislation
to
appease
the
U.S.,
and
would
have
made
doing
business
here
even
more
problematic.
We
suggested
raising
the
wage
and
again
showed
figures
on
how
to
do
it
with
a positive business
and government
impact.
11.
On
November
27,
1995,
I
submitted
to
Jack
Torres
a
position
paper
saying
the
yearly
increases
that
were
dictated
by
law
were
fair,
timely,
and
would
not
put
undo burden
on our
industry.
12.
On
December
27,
1995,
the
Variety
printed,
"Among
the
business
sector,
the
Chamber
is
the
only
group
which
has
e.xpressed
support
for
the
.30c
per
hour
increase.
THE ONLY GROUP?
Do you
read
your
paper?
If
the
past
few
years
of
our
support
and
recommendations
isn't
enough
to
show
our
position,
why
the
hell
bother
to
try
anymore!
It
seems
as
though
the
only
real
opposition
to
a
wage
increase
comes
from
the
garment
industry
which,
curiously
enough,
the
Chairman
of _ the
Wage
and
Salary
Review
Board
works
for!
If
the
garment
companies
truly
can
not
survive
a
wage
increase
then
perhaps
they
could
come
up
with
their
own
program
for
increases.
They
do
produce
significant
revenues
for
the
Commonwealth
so
we
may
have
to
look
differently
at
them.
But
the
rest
of
the
sectors
that
agree
with
a
raise
in
wage,
and
discussed
it
for
years
before
the
increase
became
law
should
not
be
made
to
look
bad
because
of
one
industry
that now does
not
agree.
Sincerely,
Mike
Schadeck
C.N. M.I.
CONTRACTORS ASSOCIATION
345
RBSFONBKS to QUEmONS FBOM RlCHARO N. REBACK
1^ U.S. Departmenf of the Interior
Office of Inspector General
Responses to Additional Subcommittee
Questions Regarding Water Island,
U.S. Virgin Islands
Submitted for the Record Hearing
on the Federal-Commonwealth of the Northern
Mariana Islands Initiative on Labor,
Immigration, and Law Enforcement
and Related Northern Mariana Islands
Legislative Reforms
(Held June 26, 1996)
Subcommittee on Native American
and Insular Affairs
Committee on Resources
U.S. House of Representatives
Richard N. Reback
Chief of Staff and General Counsel
Office of the Inspector General
U.S. Department of the Interior
346
United States Department of the Interior
OFnCE OF THE INSPECTOR GENERAL
Washinglon, D.C. 20240
JUL
- 9
1996
Honorable Elton Gallegly
Chairman,
Subcommittee on Native
American and Insular Affairs
Committee on Resources
House of Representatives
Washington,
D.C.
20515-6205
Dear Mr.
Chairman:
As
requested,
we
are
providing
responses
to
the
audit-related
questions the Subcommittee on Native American and Insular Affairs
submitted after the Inspector General's June 26,
1996, testimony at
the
hearing
on
the
Federal-Commonwealth
of
the
Northern Mariana
Islands Initiative on Labor,
Immigration,
and Law Enforcement and
Related Northern Mariana Islands Legislative Reforms.
In view of
the
Inspector
General's
recusal,
responses
to
the
questions
regarding Water
Island
are
being provided
by
Chief
of
Staff
and
General
Counsel
in
the
Office
of
Inspector
General.
All
other
questions will be addressed by the Inspector General,
Ms. Wilma A.
Lewis,
under separate cover.
If
you
or
any
members
of
the
Subcommittee
have
additional
questions,
please contact me at
(202)
208-5745.
Sincerely,
Richard
N.
Reback
Chief of Staff and General Counsel
Enclosure
cc:
Honorable Eni
F.
H.
Faleomavaega
347
Question
1:
What is the amount of annual lease rent that is being
collected by the Department from each
lessee?
Answer
1:
The lease agreement requires payment of a fixed rent of
$3,000
per calendar
year,
plus
3
percent
of gross
receipts
over
$200,000 but not more than $300,000 and
4 percent of gross receipts
over $300,000.
The lease defines gross receipts as income received
from room rentals,
bar sales,
and subleases.
Revenues from other
sources are excluded from the computation of rental payments.
The
Department collects annual rent only from the Water Isle Hotel and
Beach
Club,
Ltd.
(the Lessee)
,
which
purchased all rights under
the lease from Water Island Incorporated
in 1965.
The most recent
information we have on the amount of annual rental payments,
based
on
our
March
1988
audit
report
entitled
"Water
Island
Rental
Payments,"
is that the Lessee paid rent of $21,031 and $43,018 for
calendar years
1985 and
1986,
respectively.
Question
2:
Is
this
amount
being
collected
from
all
of
the
sublessees,
including those in Sprat Bay (who are at times referred
to as sub-sub- lessees )
Answer 2:
The Department does not collect rents or fees directly
from sublessees.
The Lessee collects annual rents of $25 or $100
from each of
its sublessees.
In that regard,
the Lessee collects
an
annual
rent
of
$100
from
Sprat
Bay
but
does
not
collect
any
rents from Sprat Bay's sublessees.
Annual rents from the Lessee's
sublessees are included in the Lessee's gross receipts for purposes
of computing the Lessee's annual rent payment to the Department.
Question 3:
Did this requirement to collect rent end or change at
the expiration of the 40 year lease?
leaver
3:
The
Office
of
Inspector
General
has
no
information
regarding the effect,
if any, that the expiration of the lease had
on
the
Lessee's
obligation
to
pay
rent
or
the
Department's
obligation to collect rent.
348
Question 4:
Are these funds being properly collected and accounted
for?
Answer
4:
We have no current information regarding whether rental
payments
are
being
properly
collected
and
accounted
for.
Our
September
1985 audit report entitled
"Lease to Water Island,
U.S.
Virgin
Islands"
found that
from
1972
through
1981,
documentation
was not available to verify either that rent was actually paid or
received or to substantiate the Lessee's gross receipts.
For the
years
1982
through
1984,
the hotel
was closed
for remodeling and
therefore the Lessee properly paid only the $3,000 annual rent.
In
response
to
that
audit
report,
the
Office
of
Territorial
and
International
Affairs
(now
the
Office
of
Insular
Affairs)
instituted
a new annual reporting process to verify
lease payment
computation.
Our March 1988 audit report on Water Island's rental
payments
examined
Water
Isle
Hotel
and
Beach
Club,
Ltd.'s
accounting records as they related to rental payments for the lease
of Water Island and to the payment
of taxes imposed by the Virgin
Islands Government
for calendar years
1985
and
1986.
We did not
find
any
material
discrepancies
in
the
computation
of
rental
payments for those years.
However, we did conclude that the Office
of
Territorial
and
International
Affairs
needed
to
require
the
Lessee
to
submit
amended
annual
reports
to
ensure
that
any
adjustments
to
the
Lessee's
gross
receipts
resulting
from
its
financial
statement audit were disclosed
and
any additional
rent
due was paid.
During the resolution of the
1988 audit report,
we
noted that the Lessee submitted amended reports for 1987 and 1988.
349
Question 5:
What management practices have attributed to the delay
in resolving the transfer of title to Water Island properties?
Answer
5;
We
have
no
information
directly
responsive
to
this
question.
By
way
of
background,
our
1985
audit
concluded
that
interests of the Federal Government were not adequately protected
by
the
terms
and
conditions
established
in
the
lease.
Specifically,
Section
10 of the lease placed the Department in an
unfavorable position when the lease expired because it allowed the
Lessee
to
occupy
the
island
indefinitely
until
a
successor
was
found and
a
fair compensation was paid
for possessory
interests.
Regarding renegotiation
of
lease terms,
we reported
in our
1985
audit
that
section
402
of
Public
Law
96-205
(the
Omnibus
Territories
Act),
passed
in
1980,
stated
that
"[n]o
extension,
renewal,
or renegotiation
of the
lease
of real property on Water
Island in the Virgin Islands to which the United States
is a party
may be entered into before 1992 unless such extension,
renewal,
or
renegotiation
is specifically approved by Act of Congress."
Given this situation,
we recommended that the Assistant Secretary
for Territorial and International Affairs determine whether Water
Island was to be retained or declared excess at the expiration of
the
lease.
If
Water
Island
was
to
be
declared
excess,
we
recommended
that
the
Assistant
Secretary
notify
the
General
Services
Administration
that
the
island
would
be
available
for
disposal
but
still
would
be
subject
to
the
current
lease
and
Section
402
of
Public
Law
96-205.
If
Water
Island
were
to
be
retained,
we recommended that the Assistant Secretary either seek
Congressional approval to renegotiate the current lease to obtain
more favorable terms or develop a plan of action for when the lease
expires.
The plan should address how Water Island
is to
be used
and
which
entity
would
be
responsible
for
monitoring
and
controlling
its
use.
In
response
to
our
recommendations,
the
Assistant Secretary reported that "the House Interior and Insular
Affairs Committee, which earlier had imposed restrictions on OTIA's
[Office
of
Territorial
and
International
Affairs]
authority
to
revise or modify the existing lease arrangement, has indicated that
language will
be placed
in
an Omnibus
territories
bill
currently
under
consideration
directing
OTIA
submit
to
Congress
a
plan
providing for the disposition of Water Island upon the expiration
of the present lease in 1992.
It is our intent to comply with this
legislative
directive
within
the
time
limit
imposed
by
the
legislation."
We
deemed
this
response
sufficient
for
us
to
consider the audit to be resolved.
We have received no subsequent
information from OTIA that states whether
a plan was developed or
implemented for the disposition of Water Island.
27-245 0-96-12
350
Question
6:
The Environmental Impact Statement was issued
in May
1996.
Why wasn't this initiated after the
1992 expiration of the
lease?
Answer
6;
We have no information responsive to this question.
Question 7:
What was the Department's position on the value of the
possessory
interest
to
the
hotel
and what was
the
ruling
of
the
Court?
Answer
7:
We have no information responsive to this question.
351
Responses to Questions from Wilma A. Lewis
U.S. Department of the Interior
Office of Inspector General
Responses to Additional Subcommittee Questions
Submitted for the Record
Hearing on the
Federal-Commonwealth of the Northern Mariana Islands
Initiative on Labor, Immigration, and Law Enforcement and
Related Northern Mariana Islands Legislative Reforms
(Held June 26, 1996)
Subcommittee on
Native American and Insular Affairs
Committee on Resources
U.S. House of Representatives
Wilma A. Lewis
Inspector General
U.S. Department of the Interior
352
United States Department of the Interior
OFnCE OF INSPECTOR GENERAL
Washington, DC. 20240
JUL
I
1996
Honorable Elton Gallegly
Chainnan, Subcommittee on
Native American and Insular Affairs
Committee on Resources
House of Representatives
Washington, D.C.
20515-6205
Dear Mr. Chairman:
As requested, we are providing responses to the audit-related questions the Subcommittee on
Native American and Insular Affairs submitted after my June 26, 1996, testimony at the hearing
on the Federal-Commonwealth of the Northern Mariana Islands Initiative on Labor, Immigration,
and Law Enforcement and Related Northern Mariana Islands Legislative Reforms.
In view of
my recusal, responses to the questions regarding Water Island will be provided imder separate
cover by Mr. Richard N. Reback, Chief of Staff and General Counsel.
In addition, we are providing a copy of our March 1996 audit report "Management of Public
Land, Commonwealth of the Northern Mariana Islands" and of Governor Tenorio's response, both
of which were discussed extensively
at the hearing.
Also, we
are providing a copy of our
October
1995
"Status of Improvements
in
Financial Management and Program
Operations
Commonwealth of the Northern Mariana
Islands," which summarized
major
long-standing
problems in financial management and program operations that have been identified in audits of
the Commonwealth.
We request that these three documents be included in the record of the
proceedings.
We appreciated the opportunity to provide testimony at the hearing.
If you or any members of
the Subcommittee have additional questions, please contact me or Mr. Reback at 208-5745.
Sincerely,
^ilma A. Lewis
Inspector General
cc:
Honorable Eni F. H. Faleomavaega
353
Question 1:
What is the aggregate cost of all the amounts identified in your statement?
Answer 1: The monetary amounts identified in the nine reports total $770,789,342.
The amounts
presented in each of the nine reports are contained in the following table:
Rqmrt
354
Question 2: When the audit was issued regarding the mismanagement of public lands in
the NMI, approximately $700 million
in
lost revenue was cited.
Based on the
late
response by tiie Governor of the NMI, what do you now estimate the total in lost revenue?
Answer 2:
The audit covered the period October
1, 1989, to September 30, 1994, and
other periods as appropriate and included a review of selected applications, deeds, leases,
permits, contracts, and appraisals for transactions that were either completed or pending
at the time. We do not have any additional information pertaining to the exchange of land,
the issuance of leases, or the award of homestead permits that may have occurred since
September 1994.
Accordingly, we are unable to provide any new estimates.
However,
if the types of practices identified in the report as in need of correction continued after that
date, additional losses would have occurred. We are providing a copy of our March 1996
audit report "Management of Public Land, Commonwealth of the Northern Mariana
Islands" and a copy of Governor Tenorio's response to the final report as Enclosures
1 and
2, respectively. We are requesting that these two documents be included in the record of
the proceedings.
Question 3:
(a) What other audits have been conducted in the last three years and what costs
or loss of revenues have you identified?
(b) Have there been timely replies to the audits? ©
What percentage of Inspector General recommendations have been implemented?
Answer 3(a):
Our response to Question
1 covers ail Office of Inspector Genera! internal
audit
reports issued
in the past
3
years
Internal audits are those reviews of internal
operations that determine whether:
( 1 ) activities are conducted in accordance with laws and
regulations; (2) activities are conducted economically and efficiently; (3) desired results of
programs are being achieved; and (4) agency financial statements are presented accurately.
In addition, we have performed two grant audits, the objective of which was to determine
whether Federal grant funds were used
for the intended purposes and were properly
accounted for in accordance with applicable laws and regulations. We have also reviewed and
processed 17 single audits during the past 3 years.
Single audits, which are performed by
independent public auditors, are comprehensive financial iiudits required by the Single Audit
Act of 1984 for entities receiving $100,000 or more in Federal assistance in any fiscal year.
These various audits and associated questioned costs are presented in the following table:
355
Report Number uid Title
356
Answer 3(b):
With the exception of the audit of public lands, to which a response to the
draft report was never provided, the CNMI has provided responses in an overall timely
manner to internal and grant audits performed by the Office of Inspector General and to
single audits performed by independent public auditors.
The effect of failing to respond
to our drafl audit report on public lands was that the CNMI did not take advantage of the
opportunity to present its position on our findings and recommendations, along with any
additional information that
it believed would further clarify
its position relative to the
findings and recommendations, for inclusion in our final audit report.
Accordingly, the
final report was issued without the benefit of the response, and all recommendations were
considered unresolved. The potential for early resolution of the recommendations was thus
delayed until the time period established for post-report responses.
Answer 3(c):
The most current information available to us from officials within the
CNMI
and
the
Department
of
the
Interior's
Office
of
Insular
Affairs
regarding
implementation of audit recommendations made during the past 3 years indicates the
following:
45 (71.4 percent) of the 63 recommendations have been resolved and reported
by those officials as implemented; 9 (14.3 percent) of the 63 recommendations have been
resolved but not implemented; and 9 (14.3
percent) of the 63 recommendations are
unresolved.
(Fifty-four of the 63 recommendations were addressed to the CNMI, and 9
were addressed to the Department of the Interior's Office of Territorial Affairs, now the
Office of Insular Affairs.)
In addition, single audits reviewed by us during the past 3 years
identified 633 recommendations, of which 319 (50.4 percent) are resolved and reported
as implemented.
There were no recommendations presented
in the two grant audits
performed by us during the past 3 years.
To date, responsible officials within the CNMI have reported that they have implemented
36 (66.7 percent) of the 54 audit recommendations that were addressed to the CNMI
during the past 3 years and that 9 (50 percent) of the remaining 18 recommendations have
been resolved.
However, as our followup audits on earlier recommendations concerning
the Capital Development Funds and the Economic Development Loan Fund showed,
recommendations,
although
resolved,
are
not
always
implemented.
Further,
recommendations reported as implemented by the auditee are not always implemented fully
or effectively.
Specifically, only 4 (16 percent) of 25 resolved recommendations from
earlier audits of those programs had been implemented fully and effectively at the time of
our followup audits, notwithstanding the passage of several
years.'
Question
4: There have been reports of misuse of government funds by officials in
different segments of the NMI Government.
What steps do you recommend to ensure the
proper and adequate accounting of public funds in the NMI?
Thirty-six recommendations were made in the earlier audits, 32 of wtiich were not implemented fijily or effectively at the time of our followup audits. Of
the 36 recommendations, the Commonweall.') had agreed with 20 of the 30 recommendations made to
it, and the Office of Insular Affairs had agreed with
S of the 6 recommendations made to that Office.
357
Answer 4: We recommend the following:
(1) Implementation of Outstanding Office of Inspector General Recommendations:
Over the years, the Office of Inspector General has made numerous recommendations that
would improve
the proper and
adequate accounting
of funds
in
the CNMI
if the
recommendations are implemented fully and effectively. We summarized major long-
standing problems in financial management and program operations of the CNMI in the
October 1995 report "Status of Improvements in Financial Management and Program
Operations, Commonwealth of the Northern Mariana Islands" (Attachment). Among other
issues, this report highlighted the major long-standing problems in financial management
and program operations that prior audits had identified and the basic performance goals
and specific improvement actions that the Commonwealth should strive to achieve in the
areas of financial management, expenditure control, revenue collection, and program
operations.
Recommendations for corrective action that were summarized in the October
1995 report included the following:
- Ensure that all Commonwealth accounting systems are adequately maintained and are
capable of generating annual
financial statements, which are then audited
in a timely
manner.
- Ensure that the encumbrance and accounts payable accounting systems provide the
current and reconciled accounting data necessary to prepare accurate annual financial
statements.
- Approve, on an annual
basis, govemmentwide budgets
that
limit expenditures and
transfer authorizations to the most current and realistic revenue projections.
- Revise the encumbrance system
to ensure that accurate and timely budget data are
available for evaluation before budget allotments are released.
- Implement controls for property management, conduct annual physical inventories, and
limit access to expendable supply.
- Implement procedures for ensuring that contractors comply with the terms and conditions
of contracts and for determining whether contractor billings are reasonable and valid.
-
Establish
formal
written
policies
and
procedures
to
monitor and
review
Capital
Development Fund projects and project expenditures for allowability and sufficiency of
supporting documentation.
We believe that these recommendations and others in our October 1995 report can serve
as a guide for the Commonwealth to address major long-standing problems that have been
identified in our previous audit reports.
(2^ Technical Assistance:
Priorities for future technical assistance by the Federal Government should be established
with the identified problem areas in mind, and funds and assistance should be specifically
earmarked to address the identified problem areas.
358
n) Congressional Oversight Hearings:
Periodic
Congressional
oversight
hearings
could
serve
as
the
necessary
catalyst
to
encourage government officials
in the CNMI and other insular areas
to resolve and
implement Inspector General audit recommendations.
Such
hearings would serve a
particularly useful purpose because the Department of the Interior does not have the same
level of authority or influence in the insular areas as
it does in
its own offices and bureaus
to ensure that audit recommendations are resolved properly and implemented fully and
effectively.
In the absence of appropriate oversight of resolution and implementation
activities,
the
benefits
that
can
be
achieved
from
the
implementation
of
audit
recommendations may not be fully realized.
(4^ Reporting Requirement:
A requirement for insular area governments to submit an annual report to the Congress on
actions taken to implement Inspector General recommendations would further encourage
the implementation of audit recommendations and
help ensure proper and adequate
accounting of public funds.
359
s.
^
S.
:!
'^
O
u
s
z
Z
8
II
Z 3
o o
M tj
30
Z H
83
360
PROPOSED CONSTITUTIONAL
AMENDMENT
NO.
24
1
Section
6
:
Vacancy .
In
the event of
a vacancy
2
in the office of resident representative
to
3
the United States,
the governor shall appoint a
4
successor with
the advice and consent of
the legislature
5
unless
the United States confers
the status
of member
6
or non-voting delegate
in the United States Congress
7
on
the resident representative and such status requires
8
a different method of filling vacancies,
in which case
9
vacancies shall be filled
in the manner required by
10
such status.
11
Section
7:
Impeachment .
The resident
12
representative
is subject to impeachment as provided
in
13
article
II,
section
8,
of
this Constitution for treason,
14
commission of a
felony,
corruption or neglect of duty."
15
16
17
18
19
20
21
22
23
24
25
Page
3 of
3
361
HOUSE OF REPRESENTATIVES
TENTH NORTHERN MARIANAS COMMONWEALTH LEGISLATURE
FIRST REGULAR SESSION, 1996
HOUSE JOINT RESOLUTION NO. iStl
7
A HOUSE JOINT RESOLUTION
To request that the United States Congress establish a non-voting Delegate from
the Northern Mariana Islands within the U.S. House of Rep'esentatives.
Offered by Representatives:
Diego T. Benavente,
Joaquin G. Adriano, David M. Apatang, Vicente M. Atalig, Jesus T. Attao, Oscar M. Babauta,
Roslky
F. Camacho, Crispin
I. Deleon Guerrero, Melvin O. Eaisao, Maria (Malua)
T.
Peter,
Karl T. Reyes, Pete P. Reyes, Manuel A. Tenorio, P.Michael P. Tenorio and Ana S. Teregeyo
Date: January 17, 1996
.
>
HOUSE ACTION
Adopted: January 17, 1996
'
SENATE ACTION
Adopted: January 18, 1996
Evelyn C. FlerfUng
House Clerk
362
TENTH NORTHERN MARIANAS COMMONWEALTH LEGISLATURE
H. J. R. NO. 10-1
HRST REGULAR SESSION, 1996
A HOUSE JOINT RESOLUTION
To request
that
the United States Congress
establish
a non-voting
Delegate from the Northern Mariana Islands within the U.S. House of
Representatives.
1
TAKING NOTE
that
the Covenant
negotiating
history makes
it
clear
that
2
Section 901 does not preclude
the Government of the Northern Marianas from
3
requesting that a Delegate from the Northern Mariana islands be established in the
4
Congress of United States;
5
FINDING that the current status of Commonwealth-federal
relations, which
6
has been marred by miscommunication, misinterpretation, and misinformation
is
7
further exacerbated by the lack of a constant and vigilant Commonwealth voice
8
and
presence
in
the House
of Representatives and
its various committees and
9
subcommittees;
10
FINDING
that
the
Northern
Marianas
Commonwealth
Legislature
has
11
overwhelmingly approved two resolutions, namely House Joint Resolution 8-5 and
12
Senate Joint Resolution 9-6, urging the Congress of the United States to establish a
13
Delegate from the Northern Marianas within the U.S. House of Representatives;
14
OBSERVING that Article V, Section
2, of the Commonwealth Constitution as
15
amended by Constitutional Amendment 24, provides
that the United States may
16
confer the status of nonvoting member delegate in the United States Congress on
L7
the Resident Representatives;
18
RECOGNIZING with gratitude that on August 10, 1994, Guam Delegate Robert
19
Underwood introduced H.R. 4927 in the 103rd Congress,
to provide a nonvoting
20
delegate
to the House of Representatives
to represent the Commonwealth of the
21
Northern Mariana Islands;
363
HOUSE JOINT RESOLUTION NO. 10-1
1
BELIEVING fervently that the pursuit of the delegate seat
is imperative in
2
attaining
full status as a member of the American political family in which thus
3
far the Northern Mariana Islands remains
the only
U.S.
insular area not
to be
4
represented in the United States Congress;
5
HOLDING TO
BE TRUE
that
non-voting delegate
status
for
the
Resident
6
Representative would neither diminish the full force and effect of the Covenant to
7
Establish a Commonwealth
of the Northern Mariana Islands
in
Political Union
8
with the United States of America nor in any sense abrogate,
qualify, or release
9
rightful claims
to local self-government contained in Article
I, Section 103 of the
10
Covenant;
it is
1
RESOLVED by the House of Representatives of the Tenth Northern Marianas
12
Commonwealth Legislature, the Senate concurring, that the 104th Congress of the
1
United States of America is hereby requested to:
14
(1) CONFER
the
status of nonvoting delegate
in
the United
States
1
Congress on the Resident Representative;
16
(2) PROVIDE
that
the
Delegate from
the Northern Mariana
Islands
17
receive the same compensation, allowance, benefits and be entitled to those
18
same privileges and immunities as a Member of the United States House of
19
Representatives;
20
(3)
WORK CLOSELY with
the present Resident Representative in the
21
drafting of federal
legislation necessary
to
realize
the
Delegate from the
22
Northern Mariana Islands; and
23
RESOLVING FURTHER that the Speaker of the House and the President of the
24
Senate shall certify and the House Clerk and the Senate Legislative Secretary shall
25
attest to the adoption of this Resolution and thereafter transmit certified copies to:
26
the
Honorable
William
Jefferson
Clinton,
President
of
the
United
States;
the
27
Honorable Newt
Gingrich,
Speaker
of
the
U.S.
House
of
Representatives;
the
28
Honorable Richard Armey, Majority Leader of the
U.S. House of Representatives;
29
the
Honorable
Richard
Gephardt,
Minority
Leader
of
the
U.S.
House
of
30
Representatives;
the Honorable Don Young,
U.S. House of Representatives;
the
31
Honorable
Elton
Gallegly,
U.S. House of Representatives;
the Honorable George
32
Miller,
U.S. House of Representatives;
the Honorable
Eni
F.J. Faleomavaega,
U.S.
33
House
of
Representatives;
the
Honorable
Robert
Underwood,
U.S.
House
of
34
Representatives;
the
Honorable
Eleanor
Holmes
Norton,
U.S.
House
of
Page 2
364
HOUSE JOINT RESOLUTION NO. 10-1
1
Representatives;
the
Honorable
Carlos
Romero-Barcelo,
U.S.
House
of
2
Representatives; the Honorable Victor Frazer,
U.S. House of Representatives;
the
3
Honorable Al Gore, Vice President of the United States and President of the
U.S.
4
Senate;
the
Honorable
Robert
Dole,
Majority
Leader
of
the
U.S.
Senate;
the
5
Honorable Tom Daschle, Minority Leader of the U.S. Senate; the Honorable Frank
6
Murkowski,
U.S.
Senate;
the Honorable
J.
Bennett Johnston,
U.S.
Senate;
the
7
Honorable Daniel Inouye, U.S. Senate; the Honorable Daniel Akaka, U.S. Senate; and
8
the Honorable Bruce Babbitt, Secretary of the U.S. Department of Interior.
Adopted by the House of Representatives on January 17, 1996
and by
the Senate on January 18, 1996
CERTIFIED BY:
Speaker of the House
OESUS R. SABLAN
'resident of the Senate
ATTESTED BY:
ELYN C. Fia^lING
House ClCTk
Page 3
365
HOUSE OF REPRESENTATIVES
TENTH NORTHERN MARIANAS COMMONWEAL TH LEGISLATURE
FIRST REGULAR SESSION. 1996
HOUSE BILL NO. KVlSg. H.D.l
AN ACT
To enact a moratorium on any expansion of the garment manufacturing Industry
in the
CNMI, including a prohibition on the Issuance of new business licenses for garment
manufacturing and a limitation on the Importation o( alien labor to work
in the garment
industry.
Offered by Representatives:
Pete P. Reyes,
Maria (Malua) T. Peter, Meivin O. Falsao, Jesus T. Altao and David M. Apatang
Date:
February 16, 1996
HOUSE ACTION
Standing Committee Report: None
Rrst fsieading: February 16, 1996
Second Reading: February 22, 1996
SENATE ACTION
Standing Committee Report: None
Second and Final Reading: February 23, 1996
366
TENTH NORTHERN MARIANAS COMMONWEALTH LEGISLATURE
H.B. NO. 10-152, HD.l
FIRST REGULAR SESSION, 1996
,
AN ACT
U
To enact a moratorium on any expansion of the garment manufacturing
industry in the CNML including a prohibition on the issuance of new business
,
j
licenses for gaimcnt manufacturing and a limitation on the importation of alien
labor 10 work in the garment industry.
]
1
BE ITENACTED BY THE TEhJTH NORTHERN MARIANAS COMMONWEALTH LEGISLATURE:
1
!
Section
1.
Title .
This Act shall be referred to as "Garment
Industry Moratorium Ac
2
-'of 1996."
3
Section 2. Finding s and Purpose.
The garment manufacturing industry has been
in
4
.existence in the CNMI since 1983. The industry was established as the result of an intensive
5
j
j campaign by the CNMI government to attract foreign investors. These investors would have
6
'the opportunity to take advantage of the Hcadnote 3A provision of the Harmonized Tariff
7
Schedule of the United States which allows garments manufactured in the CNMI to enter the
8
j United States duty free.
9
I
The garment industry has had a very significant impact on the CNMI economy.
It is
10
'responsible for over
SI 3 million in annual direct revenues to the govcrnmeni.
However,
11
12
13
14
15
16
17
18
19
20
21
22
23
24
according to an OTIA funded study, "The Impact of Aliens on the Fiscal Conditions of the
Commonwealth of the Nonhcm Mariana Islands." the net impact in 1992 of the garment
industry on the CNMI was a negative $1.3 million. This figure was arrived at by deducting the
per capita cost of government services 6xjm the per capita revenues generated.
It therefore
appears that even the financial contribution of the garment industry to the economy of the
CNMI is open to question.
The industry also provides approximately 7,500 jobs which create additional economic
stimulation to local sales and services. However, ninety percent of those 7,500 jobs arc held
by non indigenous workers:
nonresident aliens and citizens of the former Trust Territory of the
Pacific Islands.
The use of nonresident garment workers
is pervasive in the industry.
Currently an
estimated average of 400 nonresidents are employed per garment manufacturer.
Thus, if ten
new garment factories are licensed, an additional 4,000 nonresident garment workers may be
needed to operate them. The influx of so many additional nonresident workers would place a
367
H. B.No. 10-152. H.D.1
tremendous burden on all government services.
Labor/immigration enforcement and healil
services would be particularly affected.
Sewer and solid waste disposal would be stressw
beyond capacity by the introduction of additional garment manufacturing
facilities am
workers.
The Legislature finds
that neither the
social
structure of
the CNMI nor
ih(
mechanisms of government which provides public services could sustain the burdens tha
would be created by the entry of such large numbers of additional alien workers into the
! Commonwealth.
The Legislature has considered the fiscal impact of an expanded garment industry
together with the social costs of sustaining an additional large transient alien population and
the adverse effects of the industry on the natural environment and infrastructures.
The
Legislature thereupon finds that the health, welfare, and safety of the community dictates thai
there be an immediate moratorium on any expansion of the garment industry.
It is therefore the purpose of this legislation to prohibit the issuance of new business
licenses for garment manufacturing and to limit the number of nonresident worken employed
by the industry.
These purposes were fonnerly implemented by regulation.
The foimer
regulations accomplished the following:
placed a moratorium on the issuance of business
licenses for garment manufactraing;
placed restrictions on the issuance of nonresident worker
certificates
for garment workers;
established
a garment worker pool and quotas per
manufacturer
for garment workers;
established
reporting requirements
for garment
manufacturers. These regulations were administratively repealed in 1995. It is the intent of this
leglslanon to statutorily and administratively re-impose the moratorium and restrictions on the
garment industry that has served the Commonwealth well since 1987.
Section
2.
Amendment
1 CMC section 2453 (d)
is hereby amended to read as
follows;
"(d) To license and regulate businesses engaged in the construction trade and to
license businesses which
are not otherwise licensed or regulated by any other
department, agency, instrumentality^ or law of the Commonwealth.
Except
as
otherwise provided by law, the Department of Commerce shall not issue or cause to be
issued any business license for the purpose of garment manufacturing."
Section 3. Amf.nilmp.nf
Tide 4, Division 5 of the Commonwealth Code
is hereby
amended to add a new Chapter 6 to read as follows:
"CHAPTER 6.
Restrictions on Garment Manufacturing
Section 5601.
Definitions. For purposes of this Chapter-
Page 2
368
H. B. No. 10-152. H.D.1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
(a)
"Business License" means that license required to engage
in or
conduct business under 4 CMC section 1503.
(b) "Engaged in Substantia] Constniction or Manufacturing" means:
(1)
that manufacturing of textiles or textile products has begun
or will begin on or before the end of the founh month following the
effective date of this Act; and
(2)
the applicant provides evidence of the required working
capital
(cash)
in an amount of not
less
than one
million
dollars
(1,000,000) and proof of its deposit in a CNMI baivking institution; and
(3) one of the following rEquirements;
(i)
the applicant has executed a
lease or
leasehold
agreement or otherwise acquired an interest evidenced in writing in real
property within the Commonwealth for the purpose of erecting thereon z
facility for the manufacture of textiles or textile products; or
(ii)
the applicant has entered into a written contraci(s) for
the construction (including prefabrication) of a facility to be utilized foi
the manufacture of textiles or textile products on real property in th€
Commonwealth acquired for such purpose; or
(iii)
the applicant has purchased or executed contract(s;
for the purchase of necessary
capital equipment designed for anc
typically employed in the manufacture of textiles or textile products; or
(iv)
the applicant has recruited or caused by binding
agreement to be recruited on its behalf at least eighty percent of non-
immigrant alien workers skilled in the manufacture of textiles or textile
products; or
(v)
the
applicant
has made
timely
application
tc
permitting authorities of the Commonwealth government (e.g. DEQ
cue, CRM) for any permits required by law to be issued as a conditior
for the operation of a garment factory evidenced by a Department o
Finance receipt of payment of the applicable fees.
(c) ^'Garment Mantifacturcr" means any sole proprietorship, parmership
corporation, firm, assoclarion, or other group or combination engaged in
the
creation, production, or assembly of textiles or textile products for purposes o:
export.
Page 3
369
H. B. No. 10-132. H.D.1
(d) "Garment Worker" means any person whose Job tide is listed und
the definition of gaiment industry in the Diciionaiy of Occupational Titl
published by the U.S. Secretary of Labor.
(e) "Qualified Garment Manufacmrcr" means a garment manufactur
engaged in manufacturing textiles or textile products.
(f) "Quota of a Manufacturer" means the number of non-immigrant ali(
garment worken allowed per garment manufacturer pursuant to regulations
effect prior to October 15. 1995.
(g)
"Textiles or Textile Products" includes
all manmade fibers, top
yam, piece goods, made-up articles, garments, and other textile manufactur'
products which is made in whole or in part from any natural or manmade fibt
or blend thereof, that are classified under Pan 6 of Schedule 3, Pans
1. 4, 5,
or 13 of Schedule 7, Part
1 of Schedule 8, or Pan
1 of the Appendix to
i.
Tariff Schedules of the United States (19 U.S.C 1202).
Section 5602.
Pmh<hitipn nn Tstuance of ISTew Licences.
Except as oiherwi
provided in this Act, the Department of Commerce shall not issue or cause to be issu
to any applicant a business license for the purpose of garment manufacturing.
Section 5603.
Re5;mgrinn on Renewal of License.
Notwithstanding any oth
provision of law, the Department of Commerce shall not renew or cause to be renew.
to any applicant a business license for the purpose of garment manufacturing unless ti
applicant is a qualified garment manufacturer and can show one of the following:
(a)
that the applicant held a valid business license for the purpose
garment manufacturing and was engaged in the manufacturing of textiles
textile products prior to January 1, 1995; or
(b)
that the applicant was issued a valid business license for the purpo
of garment manufacturing between January
1, 1995 and the effective date
'
this Act and
that the applicant
is engaged in
substantial construction
manufacturing on the effective date of this Act
Section 5604.
Restriction on Twuance of Labor Certificates and Kntiv Permits
(a) The Department of Labor and Immigration shall not issue or cau
to be issued or renewed any Nonresident Worker Enoy Permit or Nonreside
Worker Ccrtifvcate to or on behalf of any non-immigrant alien to be employt
as a garment worker except upon a written finding by the Secretary of Lab
and Immigration that the applicant is:
Page 4
370
H-B.No. 10-152,H.D.I
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
(1) renewing an existing employment contract;
or
(2)
recruited to replace a non-immigrant alien garment worke
whose conffact of employment with a qualified garment manufacture
has terminated or will terminate within ninety (90) days;
or
(3)
recruited to fill an alien gannent labor employment quoL
authorized by the Secretary of Labor and Immigration prior to Octobe
15. 1995.
Section 5605.
Garment Worker Pool,
There is hereby established a garmer.
labor pool which shall consist of ail unused or unfilled non-immigrant alien garmer
worker positions within the quota of a manufacturer.
The criteria and procedures fc
defining and allocating these unused or unfilled positions among licensed qualifie
garment manufacrurcrs shall be as set fonh by regulation prior to October 15, 1995.
Section 5606.
Reportiny Reouirements and Penalties.
Reporting requiremen;
and penalues shall be as set forth by reguladon prior to October 15, 1995.
Section
5607.
Authority
to Implement bv Rules and Regu lations.
Th
Secretary of Labor and Immigration, the Secretary of Commerce, and the Secretary c
Finance shall jointly promulgate regulations to implement the purposes of this Act. T
the extent that they do not conflict with the provisions of this Act, these regulation
shall include re-promulgating
regulations originally published in Volume 9, No.
(October
15,
1987) of the Commonwealth Register as Emergency
Regulation:
republished as Final Regulations in Vol.
10, No.
1, of the Commonwealth Registt
(January 19, 1989), subsequently amended and in effect prior to their repeal effecti\
May 15. 1995 and October 15. 1995."
Section 4.
Ratification Any procedural or legal defect in the promulgation of thos
former regulations referenced in 4 CMC section 5607, as enacted by
this Act,
is hereb
ratified.
Section 5.
Limitarinn on Applicahnitv.
Unless specifically made applicable by locr
law, this Act shall apply only to the Third Senatorial District.
Section 6.
.Severahjlity .
If any provision of this Act or the application of any sue
provision
to any person or circumstance should be held invalid by a coun of compete;
jurisdiction, the remainder of this Act or the application of
its provisions
to persons
(
circumstances other than those to which it is held invalid shall not be affected thereby.
Section 7.
Savings Clause .
This Act and any repealer contained herein shall not
t:
construed as affecting any existing right acquired under contract or acquired under siatut(
Page 5
371
H-B.No. 10-152. RD.l
repealed or under any lule, regularion or order adopted under the siamtes.
Repealers coniainec
in this Act shall not affect any proceeding instituted under or pursuant to prior law.
Th<
enactment of this Act shall not have the effect of terminating, or in any way modifying, an;
liability, civil or criminal, which shall already be in existence at the date this Act become:
effective.
Section 8.
Effective Pate . This Act shall take effect upon its approval by the Govemo
;
i or upon its becoming law without such approval.
JESUS T. ATTAO
Acdng Speaker
House of Representatives
ATTESTED BY:
/EVELYN C. HOMING
House (aeiV
WTEL
1996
'FRPE^N C/TENORIO
Governor
Commonwealth of the N6rthcm Mariana Islands
Page 6
372
H- B. No. 10-152, HJD.l
Overridden by ihe House of Represcntadvcs on May 28, 1996 and the Senate on
April 10, 1996 with the affirmative vote of two-thirds of the members in each house.
CERTIFIED BY:
DIEGO T. BENAVENTE'
Speaker of the House
}S R. SABLAN
'President of the Senate
Page?
373
GOV. COMM . fO^^T
(HOUSEJ
^^
COMMONWEALTH OF THE NORTHERN MARIANA ISUKNDS
Caller Box 10007
FTmiLW^C.TENORlO
Salpan. MP 900SO
°°'"'~"
Telephone: <670i 6O*-220O
JESUS ceowA
Fax;(e70)a>v22ii
The Honorable Diego T. Benavente
Q
1 Juw '^^^
Speaker, House of Representatives
Tenth Northern Marianas
Commonwealth Legislature
Saipan. MP 96950
4
and
Jl}}i 3
The Honorable Jesus R. Sablan
""'"' * •-'•
President of the Senate
Tenth Northern Marianas
Commonwealth Legislature
Saipan, MP 96950
Dear Mr. Speaker and Mr. President:
This is to inform you that pursuant to the override of H.B. 10-152,
H.D.I, entitled, the "Garment Industry Moratorium Act of 1996," by
the House of Representatives and the Senate, the bill became Public
Law No. 10-9.
Department of Commerce
Department of Finance
Special Assistant for Programs and Legislative Review
27-245 0-96-13
374
The iHoiise of^presejttatwes
NORTHERN MARIANAS COMMONWEALTH LEGISLATURE
P.O. Box 586
Salpan. MP 96950
MAY 3
1995
The Honorable Froilan C Tenorio
Governor
Commonwealth of the Nonhem
Maiiana Islands
Capitol Hill
Saipan. MP 96950
Dear Governor Taiorio:
This is to inform you that the Tenth Northern Marianas Commonwealth Legislature repassed
House Bill No. 152, HD.l. the "Garment Industry Moratorium Act of 1996," over your veto, by
the affirmative vote of two-thirds
(2/3) of the members of each House,
in
the House of
Representadves on May 28. 1996, and in the Senate of April 10. 1996.
House Bill No. 10-152, HJD.l is now law.
Please inform us of the Public Law number assigned
Sincerely,
375
COMMONWEALTH OF THE NORTHERN MARIANA ISUNDS
DEPARTMENT OF PUBLIC SAFETY
Jon M. Sablan Building
CBllar Box 10007
r.
Saipan, Mariana Islands 96950
MEMORANDUM
Commhslntier, DPS
Joar M. Casiro
liinvlor ofConvcllota
Jote C Stni Nicolas
Date
:
July 09, 1996
To
:
Juan N. Babauta
Washington Representative
From
Director of Corrections
Subject:
CNMI Prison Ueport
As per your request, the total Inmate's Serving Sentence in the CNMI prison, as of July
1 , 1996 are as followed:
Inniates Serving Sentence in Saipan
S9
Tinian
Ql
Rota
01
TOTAL:
Detention Facility (Detainees):
Awaiting Trial
12
Awaiting Sentence
03
TOTAL
15
Brealidown of Inmate population by Citizenship, including Tinian and Rota:
Inmate's
CNMI
Guam
Palau
Philippine
Chuuk
Japanese
Chinese
Pohnapei
Korean
_2i_
-CI-
-£5_
_Q2..
Detainee's
JUL.
JISL
JU-
JML
JH.
JU_
_QL
Prison facility in the CNMI:
(see attached)
376
I hope thai this information provided is sufficient.
Should you have any other
concern, please feci free lo contact my office.
:^:^rr^.a/
FRANOSCO D. CABRERA
in.
11.
i.O!'-''!!*:
6126
378
Commonwealth of the Northern Mariana Islands
Office of the Resident Representative to the United States
2121 R Street, NW, Washington, DC. 20008
• Phone: (202) 673-5869
• FAX: (202) 673-5873
Juan N. Babauta
Resident Representative
July 10, 1996
Hon. Elton Gallegly
Chairman, Subcommittee on Native American
and Insular Affairs
U.S. House of Representatives
1522 Longworth House Office Building
Washington, DC 20515
Dear Chairman Gallegly:
I am writing to add factual detail regarding prison inmates
from the freely associated states to the record of the hearing your
Subcommittee held June 26, 1996, on the report of the joint
Federal-CNMI
Labor, Immigration and Law Enforcement
Initiative.
The second of the two recommendations made in that report
was that CNMI Covenant funds be directed to improving prison
facilities.
I testified at the hearing that this recommendation fails
to take into account that a significant number of inmates in the
CNMI are immigrants from the freely associated states.
Congress committed to mitigating the fiscal impacts to the CNMI
Government of such immigrants in Public Law 99-239.
Furthermore,
I testified, Covenant funds, which Congress
has designated to aid economic development and raise the
standard of living of the people of the CNMI, would not be
appropriately used paying for the costs of incarceration of
immigrants from the freely associated states.
I provided at the hearing a 1993 population coimt of freely
associated state citizens in CNMI prisons.
I have now received a
current count, as well as information on the operational costs the
CNMI bears.
Summarizing the attached documents:
•
13% of the inmate and detainee population ai-e freely
associated state citizens
•
approximately $195,000 in current year and $247,274
in projected FY97 operational costs ai'C attributable to
freely associated state citizens
•
approximately $1,447,368 of the estimated $11 million
needed for prison capital expenditures can be
attributed to the impact of freely associated state
citizens
379
Hon. Elton Gallegly
July 10, 1996
Page 2
Thank you for adding this information to the hearing
record.
I would also like to take this opportunity to note that the
Interior Department has long argued — to justify its ten year
failure to provide £ui annual report to Congress on the fiscal
impacts of inmiigration from the freely associated states — that it
is simply too difficult to obtain data needed to make such a report
from the CNMI Government.
For your information,
I requested
the enclosed data from the CNMI Government on June 27 and
received it two weeks later.
N. BABAUTA
^ident Representative
cc: Allen Stayman, Office of Insular Affairs
enc: CNMI Prison Report
380
COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
FROIIJNN C. TENOfUO
Caller BOX 1CXXJ7
Governor
Safpan. MP 9GOSO
NAY 3
S96
Telep»x>ne: (6701 6G«-22cn
jesus c. BOFUA
Fax: (G70) 004-22
1
1. Covenxx
Office of the Inspector General
U.S. Depaitment of the Interior
North Pacific Region
238 Archbishop F.C. Flores Street, .Suite 807
,,*»
,,., ^^^^n"
Pacific News Building
ft
^^^'^ ^
'
'-'^°
i-J
Agana, Guam 96910
llntib Pecif.e
i.55'»?.
Attn:
Mr. Peter J. Scharvark
itoaiMt Suan
Dear Mr. Scharwark:
v.-
Re;
Final Audit Report on Management of Public Land, No 96-1-596
This is to provide the response requested in Inspector General Lewis' letter of March 20,
1996, to the Final Audit Report on Management of Public Land, March,
1996.
First, on behalf of myself and my staff.
I would like to apologize for our failure to respond
to the draft report.
This was not due to lack of concern about the report, but an
administrative oversight on our part.
I hope that this did not inconvenience you.
I recognize that we have missed the deadline for responding to the draft report, and that the
March report is a final report
However,
I must point out one very important error in the
assumptions underlying the audit.
The Inspector General's letter states that an objective of
the audit was "to determine whether the Commonwealth was effective in ...
(2) controlling
and utilizing U.S. Government land transferred to the Commonwealth
.
.
.
."
There is an
erroneous assumption underlying this statement.
The lands being managed by the Division
of Public Lands were not U.S. Government land transferred to the Commonwealth.
Such
lands were lands owned by the Japanese Government and Japanese nationals prior to June,
1944.
Following World War
II, those lands were managed by the Trust Territory
Government, which was created by the United Nations.
While it is true that the U.S.
Government administered the Trust Territory Government until creation of the
Commonwealth, the Trust Territory Government was not a part of the U.S. Government, and
the public lands were not U.S. Government lands.
They have belonged to the people of the
Northern Mariana Islands since 1944,
first in trust and now directly.
The Audit Report is in three parts;
Land Exchanges, Lease Management, and Homestead
Administration. We will respond to each part of the Report separately.
381
I. LAND EXCHANGES
The Report makes three recommendations:
That we should-
Develop and implement written policies and procedures which require that land
exchanges are of comparable value based on current appraisals;
Develop and implement written policies and procedures which require that land
exchanges are made only when they serve a public purpose; and,
Suspend all pending land exchange agreements until the first two recommendations
have been implemented.
RESPONSES
The Division of Public Lands issued new land exchange regulations on May IS, 1996,
effective May 25, 1996.
These regulations require that land exchanges be based on
appraisals of fair market value.
The regulations do not impose a strict requirement
about how recent the appraisal must be, because we believe that we must retain some
flexibility. A copy of the new regulations are enclosed for your information.
Please
see especially pages 7-8 for rules dealing with appraisals.
The new regulations also require the Governor's Certification or the Legislature's
Declaration or Determination of a public purpose, as the first step in a land exchange.
Please see page
10, number 5.A.1, for this rule.
Land exchanges were temporarily halted.
However, they are now proceeding,
pursuant to the new regulations.
U. LEASE MANAGEMENT
The Report makes three recommendations:
That we should-
Develop and implement policies and procedures which require that lease agreements
base minimum rentals on the appraised fair market value;
Require that the flnancial documents required by our lease agreements be provided;
and, in a related matter, make certain that lessee rental calculations are accurate; and.
Insure that lease rental payments are collected, or remedies provided in the lease
agreements are pursued in a timely manner.
RESPONSES
It is not possible to 'develop and implement* the changes needed to comply fully with
-2-
382
this recommendation in a short time.
However, several steps have been taken or are
being considered.
a.
The Division of Public Lands is seriously considering issuing regulations
governing the leasing of public lands.
If a decision is made to issue
regulations,
it will be a lengthy process, probably requiring the input of many
concerned people, and involving one or more public hearings.
It is our hope
that such regulations would result in a more regularized procedure for the
leasing of public land, one which would satisfy your recommendations, at least
in part
b.
The Division of Public Lands has had the informal policy of renting public
lands at 8% of the value of the land at least since early 1988, according to
minutes of the MPLC Board.
However, we recognize that that has not always
been done.
The regulations,
if issued, may be expected to address this issue,
including both the 8% figure itself, and the procedures for determining rent.
However,
it is my hope that the Division will not adopt a strict 8% rule,
because we do need some flexibility in the leasing of public land.
For
example, some leases may provide other benefits to the Commonwealth-such
as educational, cultural, or economic~in addition to the rent being paid.
Such
benefits should not be ignored.
c.
The Division is seriously considering either hiring an employee or retaining a
consulting firm with expertise in the commercial leasing of land.
The intent of
this step would be to bring professional expertise to the leasing process.
Care
must be taken in this step, of course, to insure that the Division receives a
benefit at least equal to the cost.
The Division has hired a new manager of its Account Compliance Section.
This
individual has training and experience in both business and computer technology.
He
has already begtm the process of modernizing the Division's Account Compliance
methodology, including modem computer software adapted to the Division's needs.
This improved leadership in the Account Compliance Section, and modem computer
technology, will improve the monitoring of accounts.
Included in his review of the
problems of the Account Compliance Section is the failure of some lessees to provide
financial documents.
He is developing a method of follow up, to require lessees to
provide the required documents.
The new Account Compliance Manager has reviewed the delinquent account problem.
It is his plan to take the following steps after the new computer software has been
acquired and installed, and the employees trained:
To send notices of delinquency to
all delinquent lessees and permittees; and to refer those accounts which are not
brought current, or at least do not make arrangements to become current within a
reasonable time, to the Division's attorneys for collection.
This will take time,
because he estimates that there may be as many as 200 delinquent accounts.
It is not
possible to estimate how many of those will require l^ai action to collect.
However,
it is the Division's goal, through these steps,
first to bring all accounts current (or to
-3-
383
write off uncollectible accounts, to the extent necessary), and then to keep them
cunent through improved monitoring and enforcement.
4.
The division has hired a new Land Enforcement Manager, who is working to improve
on-site inspections of lessees and permittees.
However,
it will not be possible to
inspect every leasehold and permitted area as often as might be preferred, due to the
large number of inspections to be conducted, and limited staff (3 employees).
The
Land Enforcement staff also has responsibility for inspecting encroachments on the
public land, and homestead lots.
5.
In connection with items number 2 and 3 above, the Division has requested that a
second attorney be assigned full time to the Division.
While this will take time, when
it is accomplished,
it should facilitate follow up on enforcement of lease provisions.
in. HOMESTEAD ADMINISTRATION
The Rq)ort makes four recommendations:
That we should-
la.
Require that all deeded lots be inspected periodically, to insure that they are being
used in accordance with laws, regulations, and deed restrictions.
lb.
Develop and implement policies and procedures to insure that homestead permits are
awarded to applicants who are eligible under ^)plicable regulations and who have the
greatest need.
2.
Review all previously issued homestead deeds and permits and perform on-site
inspections so that assurance is provided that deeded homestead lots are being used in
accordance with applicable laws, regulations, and deed restrictions.
3.
Initiate administrative and/or legal action to re-acquire the following homestead lots
(that is, cancel the deeds and return the lots to the Division of Public Lands):
a.
Lots which the recipients are using or subleasing improperiy;
b.
Lots which the recipients sold in violation of the 10-year Constitutional
requirement for homestead ownership; and,
c.
Lots which were deeded to ineligible applicants.
4.
Request an Attorney General's opinion on the possibility of seeking recovery of illegal
and/or improper monetary gains resulting from the sale and/or lease of homestead lots
in violation of law; and initiate legal action to recover such funds, as appropriate.
RESPONSES
la.
It would currently be impossible to inspect all deeded homestead lots for compliance
384
with laws, regulations and deed restrictions. We have a staff of three people who
must do inspections of lots under homestead permits, all lease inspections, and
numerous other tasks such as watching for unlawful use of the public lands.
While
we are not denying that such inspections would be useful in the interests of law
enforcement,
it would literally take an act of the Legislature to appropriate money to
staff and equip such an effort
This must be relegated to long-range planning.
lb.
This recommendation involves several tasks:
Review of homestead applications, cross
checking with the Division of Land Registration and Survey for other interests in land
by applicants, and review of financial information submitted by s^plicants.
The
Division has hired a new Homestead Manager, as of May
1 , 1995 (subsequent to the
your audit).
He has instituted a new policy of performing each of these tasks, to
insure eligibility and need.
The issue of need
is settled by assigning each eligible applicant to a priority group,
according to the existing homestead regulations, as follows:
Priority Group
1
CI
Married with dependents, or single parent; need for housing.
C2
Married, with no dependents; need for housing.
Priority Group 2
Not married; need for housing.
Priority Group 3
Temporarily out of the Commonwealth, usually for medical,
educational, or employment purposes, or military service.
Under the Homestead policies established by the former MPLC Board, lots are
awarded
first to all members of Priority Group
1 before awarding lots to members of
Priority Group 2, and so forth.
2.
This recommendation overlaps with la above.
The only new part is the review of the
homestead deeds and permits,
in addition to inspection of the lots.
Review of the
deeds themselves will not be useful without the staff to conduct on-site inspections.
We have a record of all previously deeded homestead recipients, and so do not need
to review the deeds to determine their identities or lot numbers.
All permit files are reviewed for compliance with homestead laws and regulations
before deeds are issued.
The village homestead lots under permit are inspected at
least three times before a certificate of compliance is issued:
(1) during the first three
months of the permit; (2) during the first two years, to check for compliance with the
requirement that a home has been built and the permittee is living on the lot; and (3)
at the end of the three-year permit period, to check for compliance with all
requirements before the certificate of compliance is issued.
This procedure is not a written policy, however.
It is the practice of the Homestead
and Land Enforcement Sections of the Division of Public Lands.
385
3.
Parts a and b of this recommendation would require on-site inspections, as
recommended in
jf la above.
As mentioned above, the Division of Public Lands does
not cunently have the staff to conduct such an ambitious inspection program.
The
Division intends to do what
it can to accomplish such inspections, but
it will be very
difficult to go very far with it, given the current understaffmg.
In addition, the Office
of the Attorney General does not currently have sufficient attorneys to initiate the
number of lawsuits contemplated by this recommendation.
Part c of this recommendation would require the Homestead staff to invest a ve^
large amount of time in the review of old Hies and additional investigation.
This,
too, is beyond our stafTmg at the present time.
At best, they can only investigate files
that are brought to their attention for possible violations of law.
In addition,
I am advised by counsel that before initiating legal action to re-acquire
lots from ineligible homestead recipients, we must conduct legal research into whether
we have the authority to set aside such deeds.
The Director of the Division of Public
Lands has requested the Attorney General to conduct research into that question.
4.
The Director of the Division of Public Lands has requested a legal opinion from the
Attorney General into the question of recovering funds from homestead recipients
who wrongfully sold or leased their homestead lots.
Initiation of legal action to
recover such funds must await the issuance of the legal opinion.
We hope that the above response meets your needs for the immediate future.
As you can
see, there is a great deal to be done in order to implement the recommendations of the audit,
and we have made a serious beginning on the task.
If you require any additional
information, please do not hesitate to contact me.
Enclosure
386
S. liRO. 9&-&1S
1985 OMNIBUS TERRITORIES LEGISLATION
HEARING
BXIDRK TtiC
COilMITTEE ON
;
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
NINETY.NINTH CONGRESS
FIRST SESSION
ON
S.
1441
A BlU TO AMILN'U Till: UUAM UMUAMC ACT. AND ^R OTIiEK i'L'KPUSra
SJ. KcB. 192
JOINT RiaOLUTJON TO AUniOKUE UNANtlAL ASatHTANCK »X>K TIIE NOHTIICKN MARIANA
ULANW. AND TOK UHlUt rUNfUCilia
II.R. 2478
? AN ACT TO AMCNO Tilt RtVlSEU OKOANIC ACT OK THE VIRUIN WLANlKI. Tl» AMKNJJ TIIC COV.
i
KNANT TO CSTAhUSII A IXJMMONWCALTii Or Till: NOKTIIKHN MARIANA ISIANUS. TO AMCNO
Tlte ORGANIC ACT or GUAM. TO l-ROVIUi: »VK TIIK UJVERNANCE OK TIIK INSULAK. AKCAS Of
TJIK UNITED STATES. ANO i\M OTIIEJJ KUKITJStS
DECEMBKR
3. 1985
STATEMENT OP HON. CARL T.C GUTIERREZ. SPEAKER, GUAM
f
..
..
»
.t
LEGISLATURE
, Mr. Gurmasz. Thank you, Mr. Chairman.
Good morning, members of this distinguiahed committee. With
me today
Is two senators that will speak to two different issuee,
Senator Quitugua of the education will speak on 29(b); and Senator
Santos on the land issue. But
I want to take this opportunity to
possibly use to further amend 2478 as n vehicle that deals with the
independent public proeecutor, independent public auditor, and the
independent civil service commission.
This legislation
is endorsed by Congressman Blaz, and
I thank
him for that, but creation of these ofHces, Mr. Chairman, is the so-
lution for a problem that has plagued Guam all too often in recent
years—and that
is, corruption. No government
is immune from
this problem, but lately Guam seems to have suffered more than
its share of abuses.
There was the last administration's $26 znillion road-paving scan-
dal. Then the Federal extortion conviction of several GovGuam offi-
cials, plus food stamp fraud, improper contracts, and various illegal
387
activities throughout government Things are Just getting out of
hand, Mr. Chairman.
)
In my view, the problems of corruption on Guam atoms largely
from excessive
political
interference
in
divisions
of government
that need freedom from politics to be effective. Attorneys general
on Guam,
for example, depend on the Governor
for
their jobs.
Thus, very few AG's will prosecute the administration's
political
allies. The same applies
to auditors—>few
will
reveal fraud that
would embarrass the Governor. The bottom line
is, Mr. Chcurman,
that prosecutors and auditors without independence
is like guard
dogs without teeth. The secret to beating corruption is simple: Give
those guard dogs the independence they need.
•
'
Before we can move forward, however, we need Congress' help.
Right now Federal law
is tying our hands behind our back. We
cannot legally create these offices In an independent fashion be-
cause the Federal Organic Act forbids
it. The act's sweeping nrant
of power to the executive branch already has blocked two futile at*
tempts by the legislature to create an independent special prosecu-
tor. Both attempts were struck down by the courts as "inorganic."
All I ask today
is that Guam be freed from these Federal hand-
cuffs and ailowni to fu our government with our own hands. The
legislation Consrcssman Blaz and I are urging holds the key. The
legislation would amend the Organic Act to expressly permit the
legislature to create these ofTices in an independent fashion.
The ptt>poeal authorizes the legislature to establish such offices
and to design procedures for selecting officeholders. Once the of-
ficcs are established by local law, the legislature could not amend
such law for 6 years, m order to ensure real independence. After
such &-year period, any amendmonU to this law would be followed
.
by additional
6-year periods during which the
legislature would
again be prohibited from making further changes.
n
The proposal would not require Guam to establish such offices.
nor would
it dictate how they will be organized. These are local
issues and should be decided by the people of Guam through their
;,
elected representatives. All the legislation docs that we're seeking
'
essentially is eliminate the Federal restrictions that stand in our
.'
way.
Most members of the legislature, and
I believe most of Guam's
citizens, do strongly support creating these independent offices. In
fact,
the
Eighteenth Guam
Legislature
just
last week
recently
adopted Resolution No.
217, which wholeheartedly endorses
this
proposal.
Let mo just briefly address each of these proposed
offices, Mr.
Chairman.
\
An independent public prosecutor,
in my view, represents the
most effective means available for reducing corruption on Guam.
Prosecutors need freedom from political pressure in order to attack
corruption within the
administration's camp. Yet now,
as
I ex-
plained earlier, the attorney general
is the Governor's captive. No
matter how honest or well meaning, he simply must respond to po-
litical pressures to keep his job. It should thus come as no surprise
that prosecutions of high level officials are \ery rare, except when
a new administration occasionally decides to crack down on
its
predecessors.
,
388
Tho white collar crime task force created by the current adminis>
tration
reflects
thia
historical
pattern. The task
force does have
some commendable accompHshmentA. Yet
it
is anything but inde*
pendent and, in fact,
is headed by the' Lieutenant Governor. Pre-
dictably, the vast majority of its coses concern
illegalities perpe-
trated during the term of the previous administrations.
The need
for an independent
public
prosecutor goes hand in
hand with the need for an independent public auditor. Only contin-
ual oversight by nonpolitical auditors can eliminate the fraud and
incflicicncies
plaguing
our
government.
Currently,
Independent
government auditing is limited to isolated investigations by the In-
terior Department's
inspector general. Yet the
IG's sporadic
re-
ports are issued long after problems arise. This is too little too late.
The Government of Guam needs an independent local auditor back
on Guam breathing down its neck at all times. This is tho only way
that irregularities can be effectively deterred or at least detected
before they develop into fmancial disasters.
Let me turn now
to the need for an independent
civil service
commission. This aspect of our proposal responds to a specific type
of corruption on Guam: the corrupting of our
civil service merit
system. As you know, about a year ago
all the members of the
Guam Civil Service Commission were forced to resign or relieved of
their
duties. Once
again,
partisan
politics was
injected
into a
system designed to protect employees from politics.
As a result of last year's moss firing, the whole merit system has
been undermined. Government ofTicials are thus virtually defense-
less when threated with political pressures. Their fate will remain
at the mercy of the political power brokers until Guam is allowed
to design a civil service commission that is truly independent.
The need
for an independent public prosecutor, public auditor,
and civil service commission ultimately should bo addressed in a
constitutional convention pursuant to the Guam Commonwealth
Act.
I am a member of the commission on self-determination and
am
fully
committed
to
leading Guam
toward
Commonwealth
status. But I am also a realist, Mr. Chairman, and I know it will be
quite some time before a Commonwealth Act Ib passed, signed into
law, and approved by Guam voters. It will even be longer before a
constitutional convention is then called and completed.
We cannot afford to wait. The problems of corruption, inefficien-
cy, and
political meddling are all too urgent, too severe, and too
costly, and they must be addressed now.
So I would like to leave it at that, Mr. Chairman, and I hope that
any vehicle could be used at this moment to effectuate these new
offices.
389
g \ 'Wbmpag[ FhaecutfvVQte^iim'TllK^
ckOod fgr tho
gj fimram m agpwffiedjwfa^ fhium taauA Arthur G.
g SeagnwM andliuii G^^ 8ragnrv<B« W9diuad«y becnuv the
>< caaa ww a aatotake ~
tiiitt waa tho lost straw.
9
Maxwdh action Wn 'a'.onii|dete revenal from his Aug.
S IS tafamwnt to.Judga jpniaamTy^aegoJOattrmoi at a twu
u bearinft that both men diouldmnaln in jail becBUMtbiey
' g have "we hi^Mst immitiva tb.Boe this jurisdictioa.''
&'-! He taid the judgp tbat he bad an'^Wno^ sbm^ case
'S 'ami would te able to ooovipt tba'tw'o. men rfalmdncrifidiei^
U.iihj-
'Li
^- ^.-^ K
Limtiaoo brtaaath.
^
III f ps V^ an BOiatellfrifawhe^Ae!^ Om pdibo
^<'- 1 JnoktefH, -.ffWSt VWUld ^'. '"^'thbeld evidenc« that
LYffit© ^<;iff BB an J*r|for-v*,.*. pbri^pi meuamm
]
ftunate $nor that nSa to V innooent, bat MumoU said
i'COmaS^ adOSSaS jUSt<^'t;: tmi^fjoopardize furtiier
I tt» latest cl9^^^m ^•SS^iaS^
< DUngiOT^praTHnal pipSa- ^^dent, mi»t>>n>I<) wnla it'
XUticn'C&beS'^ICa
'
off a» an tmfetainate cnqr-
I,.
i, r?/ij'""'"^~
.
•
that has tffbeoonwled. But
,
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, ftSbruaiy. *!* *^ " '*^*
' *>->'flBe ofBevmd hw^ aim-
;aMaiiMBiiMiifeHaM^iMMMM inal imeecutHD cans that
•
ihave oodined'aian ManraQ took over in Febniaiy. Here are
.. 'acme o(far goDivlea dJaoMieivd Jby to Aaifr AK»«
'amnvatsd aaandttrnd other i&agDa afidsjat Jpenhioo Ti
l^dHnL Because of '^flagnot'iirMKaitdnal misoooBuctT she
I
'
Jtoi* lAnJUdge Bamminyj^'Qns thnw 'out a daig
'and fitHni»,caM^Winat no^-lbveB Cabacomg .h: Ihv jud9»
'said he ymVimiuim Uwcaaebut ao tfaeptasenitipo ^nukhA
be tni
iwiull iiim ansdier aequittoL- Ihe'uan ww dsaotibed
•
1]Xinibo<Aoenasoaeoftfaftb«poBtdnigdeakneaCiuaaL
•
dviy £.Vudge Joanuin 'm Manibasao Jc dismifed
a jobbeiy case egRBMt Saniwl David Tfai^ w^ had qnnt
mom than tfans yeare in Jail waitinK
fia: tdaL MnnihuHan
said tfteddsorWrn thB-'^^Sofpaecutorial nedjs«iipe.'
Jtibr ^ Ju^ ^ka>ow 'iydux«i><3atowood donisaed
lape diaiBBs againat A^ocent Roeaito Mnnihiwari and fined
the ACa offioe^OOO for a "doror gtand jury indidnnnt*
She ak» aaid. lot, it be Imn^.tbat, thi^.ldi^ of prueacu-
tioo can not bappoi again.'
I
<hiiy a& JudoB FVanoea IVdincEoCatewoad threw oyt
an annad lobbeqr case asainst Jiw «)«ha Ow boapuse proe-
ecutcn vitdaiad ndea regardiiu the mihnusaion of ovidHice.
•
iUiC. L Judge Franoes lydincgoGotawood diinniiised
dnur^W dtaiBBS against Ferdinand B«giB GaliBDdee and
D^Koi^GeiiaddBWMlTebUkDd the AGHi office, tiiset when
01^ fik cbaigee "they atwuld.be tzial rea^y at that point*
TWe recoid ofpriBwxrtfcn ddi)(4nBe9 deaitydrtwts fr^
tiie crodibili^of the ACTb office. And becauao Attorney Gon-
enil Cahrin HdkW hamX nsnmded to the obvious defi-
denciee or tal«ai,pK»n to.s# JJmJgJl etrai^ tt also nfl^
pooitv CO Um ay-wtiL P a|B_3'
'
r
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( ffMOwkaarftmin 1^ ctimlmJ justice system, UieaWD
«dV^ aow^ AadMBM •ve^oalty'wm decide tbeyw
had mou^ and taide to take Juslioo into thdr own hands.
; Wb caS^hnJifi^ oonJtouodjtaingBiig.in fteiproBecutJoo
dhrinon. and VU'innt toteratri tha'apputnt lack of ooDoeni
flmn tho AG and the giivemaco'/xi-
I
'-'
I Tim penrfe of Guani want to put twth into 'gottina tou^
on aimo-Mtii time to elect our own attonwy genena ao v«e
can take oontnl of a juBOoa iQistera that is out of ooDtioL
390
United States Department of the Interior
OFHCE OF THE SECRETARY
Washington, DC. 20240
October
15,
1996
Honorable Elton Gallegly
Chairman
Subcommittee on Native American
and Insular Affairs
Committee on Resources
U.S.
House of Representatives
Washington,
D.C.
20515
Dear Mr.
Chairman:
Enclosed
are
answers
to
written
questions
submitted
to
the
Department
of
the Interior after the July
24,
1996 hearing of the
House Subcommittee on Native American and Insular Affairs.
Sincerely],
'Allen
P
.
' Stayman
Director
]
Office
6f__ljisular Affairs
391
Subcommittee on Native American and Insular Affairs
Oversight Hearing on Territorial
Issues
July
24,
1996
Questions
for Department of Interior
Question
1.
The Inspector General's Office provided data from its
March 1988 Audit Report.
The Committee is interested in receiving
more current data.
What is the amount of annual lease rent that is
being collected by the Department from each lessee?
Answer. The 1952 Water Island lease provided that the master lessee
would pay a base annual rent of $3,000.
With the termination of the
lease in December,
1992,
the Department took the position that the
lessee had essentially abandoned its interest
in the property and
declined
to accept
the
annual
rent.
This decision was
based
in
large part on the litigation position of the United States
in the
ongoing
litigation
with
the
former
master
lessee
in
the
United
States Court of Federal Claims.
With the settlement of the lawsuit,
there
are
no
further
lease
payments
due
from
the
former
master
lessee.
The
lease
authorized
the
master
lessee
to make
subleases.
The
subleases provided
for
a nominal annual
rental,
generally
in the
range of $25 although some were higher.
Upon the termination of the
master lease,
a small number of sublessees attempted to tender a $35
annual rental payment to the Department,
but we declined to accept
it.
Again,
this decision was based upon the litigation position of
the United States in the ongoing litigation with the master lessee
in the United States Court
of Federal Claims.
We also considered
the cost of administering and implementing a collection program for
the
small
sums
of money
involved.
With
the proposed
sale
of
fee
title
of
the
Water
Island
tracts
to
the
sublessees,
no
rent
is
currently being collected.
Question
2
.
Is
this
amount
being
collected
from
all
of
the
sublessees,
including those in Sprat Bay
(who are at times referred
to as
sub- sub- lessees )
Answer.
No,
as explained in response to question
1,
the Department
is not currently collecting any rent
Question
3
.
Did the requirement
to collect rent end or change at
the expiration of
the 40 year lease?
Answer.
With respect to the master lessee,
the rental requirement
continued through the master lessee's occupation of
the property.
As discussed in response to question
1,
the United States took the
litigation position
that
the property had been abandoned by
the
former master lessee.
392
with respect to the subleases,
it
is a difficult question whether
the rental payments could have been changed upon the termination of
the lease.
As discussed above,
the decision not to collect rent was
based primarily on litigation considerations.
The question should
become moot by the proposed sale to the sublessees of fee title to
the properties
Question 4.
Are these funds being properly collected and accounted
for?
Answer.
Please see the answer to question
1,
above.
Question 5.
What management practices have attributed to the delay
in resolving the transfer of title to Water Island properties?
Answer.
The ongoing litigation with the former master lessee has
been
the
major
source
of
the
delay.
We
could
not
proceed
to
transfer title while this challenge
to the Department's title was
unresolved.
The Department
also was
required
to comply with
the
National
Environmental
Policy
Act,
as
amended,
and
with
other
related statutes such as the National Historic Preservation Act.
Question
6.
The Environmental Impact Statement was issued in May,
1996.
Why wasn't
this initiated after the
1992 expiration of the
lease?
Answer.
In fact,
the preparation of
the Environmental Assessment
was
initiated
shortly before
the
1992
termination
of
the
lease.
Time
was
required
to prepare
the
environmental
assessment,
seek
community input, and reach a decision on the alternatives presented.
Question 7.
What was the Department's position on the value of the
possessory
interest
to
the
hotel
and what
was
the
ruling
of
the
court?
Answer.
The United States, through the Department of Justice,
filed
a
summary
judgment
motion
in
the United
States
Court
of
Federal
Claims
arguing
that
the
former master lessee was
not
entitled to
compensation for its alleged possessory interest as a matter of law.
The court never ruled on the motion in that the case was submitted
to
arbitration
before
the
American
Arbitration
Association
and
judicial proceedings were stayed.
During the arbitration proceeding, the United States maintained that
the former master lessee was not entitled to compensation for its
claimed possessory interest as a matter of either law or fact.
The
Arbitrator,
rendered
an
award
of
$12
million
against
the United
States.
The parties subsequently coit^romised on a consent judgment
of $7.5 million which was entered by the Claims Court on August
2,
1996.
393
The stated intention of the Department of the Interior was to offer
parcels for sale first to sublessees of record and,
in fact,
offers
have been made to a number of sublessees who were in possession of
their parcels at the time of termination of the master lease between
the government and Water Island Corporation.
However,
on the Sprat
Bay side of Water Island no offers were made to the sublessees
in
possession.
Instead,
an
offer
was
extended
only
to
Sprat
Bay
Corporation,
which had subleased and assigned all its right,
title
and interest
in the majority of
its parcels years ago.
Question
8
.
Can the Department of the Interior explain why it has
extended
an
offer
that
is
inconsistent
with
its
stated
policy
regarding sales of parcels?
Answer.
The Department has followed its stated policy by extending
its offer to purchase to all sublessees under the master lease.
The
sublessee for the Sprat Bay tract
is the Sprat Bay Corporation.
Question 9.
The time for performance of the written contract with
Sprat
Bay
has
passed
and
there
do
not
appear
to
be
any written
extensions
of
time
to
perform.
Does
DOI
consider
the
contract
voidable at the option of either party?
Answer.
The
contract
has been extended with the consent
of both
parties
.
We believe we have a contractual commitment to the Sprat
Bay Corporation.
Question
10.
Does
the
fact
that
Sprat
Bay
has
transferred
and
assigned all its right,
title and interest in certain parcels meant
DOI will be obligated
to transfer title
to the
transferee
rather
than to Sprat Bay Corporation?
Answer .
No
Question 11. Does the DOI feel that it has either a legal or a moral
obligation to extend offers to sell to the sublessee in possession
of each parcel before making an offer to any other party?
Answer.
The Department believes it has a legal or moral obligation
to the sublessees under the master lease
.
These sublessees include
the Sprat Bay Corporation for the property subject to its sublease.
Question
12
.
Has
DOI
considered
the
fact
that
concluding
its
contract with
Sprat Bay Corporation will
result
in dispossessing
sublessees who have been in possession of parcels for years?
Answer.
We have no reason to believe that this will be the result.
The Department is unable to make a further response in that certain
individual
lot
holders
on
Sprat
Bay have
filed
suit
against
the
Department
and
the
Sprat
Bay
Corporation
in
the
United
States
District Court
for the Virgin Islands.
394
Question 13
.
What steps have been taken by DOI to insure that the
possessory interests of each sublessee in possession at the time of
termination of the master lease have been determined and paid before
transferring title to Sprat Bay Corporation?
Answer.
We are unable to respond to the question at this time due
to the pendency of the litigation set forth in response to question
12
,
above
Question 14.
Does the transfer of title from the Government to a
buyer require any further Congressional authorization?
If not, what
statutory authority permits
sale of the parcels?
Answer.
The sales are authorized by 48 U.S.C.
1545(a).
395
United States Department of the Interior
OFHCE OF THE SECRETARY
Washington, D.C. 20240
October 15, 1996
Honorable Elton Gallegly
Chainnan
Subconunittee on Native American
and Insular Affairs
Committee on Resources
U.S. House of Representatives
Washington, D.C. 20515
Dear Mr. Chainnan:
After the June 26, 1996 hearing of the Subcommittee on Native American and Insular Affairs
you submitted a number of questions in writing.
Enclosed are the answers of the Department
of the Interior.
Sincerely,
Allen P. Stayman
\
Director
v
-'
Office of Insular Affairs
U^
396
QUESTIONS AND ANSWERS FOR THE DEPARTMENT OF THE INTERIOR
1
a.
Is the Federal-CNMI Initiative on Labor, Immigration and Law Enforcement a Joint effort
of the CNMI Government and Federal agencies?
Answer .
The Federal agencies work cooperatively with the CNMI government
on issues affecting the Initiative.
This does not mean that the anmial report and
actions by Federal agencies must be approved by the CNMI.
Indeed, in 1995, the
CNMI submitted a separate report.
We expected that a similar procedure would
be followed in 1996.
b.
Is the Report a combined effort of the CNMI and Federal agencies?
Why
is there no
CNMI component to the Report?
Answer .
While the Federal agencies work cooperatively with the CNMI, the
report is not a combined effort. Our expectation was that the CNMI would submit
a separate report, as in 1995.
c.
Would you explain the lack of CNMI contribution to the Report?
Answer .
The Second Annual Report on the Federal-CNMI Initiative on Labor,
Immigration and Law Enforcement is the work product of Federal agencies. The
CNMI responded to a number of our requests for information, which is included
in the report.
2. The core of the problem identified in the Report is the inability of the CNMI government to
control local immigration.
It has been pointed out in the Report that "it is ironic that local
control of immigration was insisted upon by the CNMI Government negotiators in order to
prevent inundation by immigrants with a resulting loss of native Chamorro and Carolinian
culture and influence.
Yet, local control has had exactiy opposite of the intended effect.
a.
Is it not true that the 1995 CNMI census show a total population of approximately 60,000
people with a population growth of 38 percent from 1990 to 1995 and the indigenous.
American citiizen population is now outnumbered by a ration of 2 to 1?
Answer .
The preliminary
mid-decade census figures from the CNMI show the
population in 1995 to be 59,913, with the population growth you describe.
The
ratio of aliens
to United
States
citizens, however,
is 54 percent of the
total
population to 46 percent.
b.
The unrestricted presence of alien workers has a dramatic impact on the social, economic
and political
instititution as in the CNMI.
It has been associated with increased drug
trafficking, white collar crime and govenmient corruption, an enormous strain on local
government services and infrastructure, and a concern about the fiiture political impact of
397
children of alien workers bom in the CNMI, who are United States citizens by birth.
Is
it now appropriate for the Federal Government to
step
in and take over immigration
control to help the CNMI preserve the intent of the Covenant?
Answer .
The Federal agencies involved with the Initiative believe that
it would
be inappropriate for the Federal Government to assxime immigration authority at
this
time.
Our
report
on
the
Initiative
contains
no
recommendation
on
immigration, but does state that the immigration issue will be considered in the
coming
year,
as we
assess
the
effectiveness
and
improvement
in CNMI
administration of immigration.
c.
In last year's report dated April 24, 1995, recommendation was made for a cap on alien
workers
to the
1992
levels, but the Report
fails
to address this recommendation and
remains silent on the issue. Would you enlighten us of your dramatic change of position?
Answer .
The 1995 report stated that if law enforcement does not improve or if
the alien population increases above the 1992 level, then Federal authorities would,
in 1997, seek application of
the Immigration and Nationality Act (INA) to the
CNMI.
Since the time of that report, we have concluded that the INA may not
fully address the immigration problems in the CNMI.
Full application of the INA
could have unintended consequences.
Thus, the position on immigration was
modified in 1996 to call for the presentation of options in 1997 for consideration
by the Congress.
3.
a.
The major recommendation
in
the
report
calls
for
the
federalization of the CNMI
minimum wage.
Is this recommendation concurred by the CNMI?
Answer .
No.
While some members of the
legislature and several important
business organizations have supported maintaining the automatic minimum wage
increases enacted by
the
legislature
a few years
ago,
the
legislature and
the
Governor do not now support the Administrations' proposal to incorporate into
Federal law the then-current CNMI minimum wage law ($2.75 per hour with
automatic
$.30 annual
increases
until
the Federal (FLSA) minimum wage
is
achieved).
The CNMI Legislature recently passed and the Governor signed a new minimum
wage
bill that superceded the then-existing minimum wage law.
The new law
provides,
effective July
1,
1996, a $.15 an hour increase for the garment and
construction industries with another $.15 an hour increase a year later, and a $.30
an
hour
increase
for
all
other
industries.
Workers
employed
on
existing
employment contracts signed before May 6, 1996, would get no increase until the
employment contract is renewed. The provision for future annual minimum wage
increases is not included in the new law.
398
b.
The other recommendation in the Report urges Congress to direct the CNMI to utilize
Covenant funds for the construction of prison and detention facilities. How would these
recommendations help resolve the problems created by the imrestricted local immigration
control in the CNMI?
Answer . The second annual report on the Initiative calls for the use of Covenant
funds to build prison and detention facilities.
The existing facilities are widely
agreed to be inadequate.
The result is that persons who are ordered deported are
often found back out on the street.
Ineffective deportation procedures contribute
to immigration control problems.
Construction of new facilities will not cure all
the problems
associated
with
unrestricted
immigration.
Also,
increased law
enforcement in the CNMI is resulting in the need for additional facilities.
4. The Report shows that more than 25 criminal cases were in the docket of the Federal District
Court for 1994-95 and an additional 20 criminal cases for first three months of 1996, how
many convictions were handed by the Court and where are the criminals incarcerated?
Answer .
In Federal District Court for
all of fiscal year 1995 (10/1/94 through
9/30/95) of 23
cases with 28
defendants,
12
cases brought conviction of
13
persons.
In the
first half of fiscal year 1996
(10/1/95 through 3/30/96) of 24
cases with 33 defendants,
11 cases brought the conviction of 16 defendants.
o
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