$108-M COMPACT-IMPACT COSTS House seeks immediate reimbursement

The House of Representatives yesterday called anew for immediate reimbursement of costs incurred by the CNMI government from hosting thousands of Freely Associated States citizens on the islands.

Likewise, it strongly urged for a waiver on the local matching requirement for federal construction grants under the capital improvement projects of Section 702 of the Covenant.

A resolution was adopted during a House’s special session in which members asked assistance from the U.S. Department of the Interior to draw attention to the two local pressing issues that have remained unresolved with the federal government.

The move followed recent disclosure of a preliminary report of the Interagency Group on Insular Areas, a body tasked by President Clinton to give policy guidance on CNMI, Guam, American Samoa and Virgin Islands through discussion between the four islands’ governors and senior White House officials.

It outlined several action plans for each of the territory, including a review of the reimbursement demanded by the CNMI to cover for the impact of migration by people from neighboring Micronesian islands under the Compact agreement.

So far, island leaders have estimated the costs of extending assistance, such as free housing, medical services and education, to the FAS nationals here at between $80 million to $108 million since 1986.

Noting that $28.8 million of expenditures using local funds in the past two years alone have yet been compensated, the lower house said the Interior department and the IGIA should help the island government obtain the badly-needed reimbursements.

It also pointed out that while the CNMI has repeatedly raised the issue, its neighboring island of Guam has already received Compact-Impact funds despite their joint efforts to seek federal assistance.

Both the CNMI and Guam have demanded payment from Washington representing costs of hosting FAS citizens, which they maintained has been promised to them by the federal government.

House members, meanwhile, underscored the need to waive the “dollar-for-dollar” matching requirement for the $11 million grants for CIP program of the government, citing the persistent financial difficulties confronting the Commonwealth.

They also noted that the CNMI receives the less amount of federal program funding and yet is obligated to appropriate $11 million annually to avail of the grants.

Forged under the Guerra-Manglona agreement in 1992, the requirement stipulates that the CNMI must come up with the same amount of money before drawing down CIP/702 construction grants provided from 1996 until 2002.

At present, the Tenorio administration is awaiting completion of the anticipated $60 million bond float whose proceeds will be used to match the grants. Over $50 million have already been appropriated locally for the last two years to avail of the assistance.

Without these funds, according to the resolution offered by Ways and Means chair Rep. Antonio M. Camacho, the CNMI “would face an unprecedented economic struggle to continue to provide adequate public services, while satisfying its financial responsibilities and debt service obligations.”