OIA gets lashing over use of Compact-Impact funds

Senate Floor Leader Pete P. Reyes has slammed the Office of Insular Affairs over a directive it reportedly issued to the CNMI reminding the island government of federal regulations in spending recent Compact-Impact reimbursement.

He said the $1 million handed over to the CNMI last October by OIA Director Ferdinand Aranza is not a federal grant, but payment for costs incurred for hosting citizens of the Freely Associated States on the islands.

He accused Mr. Aranza of providing misleading information regarding federal policy to the CNMI after issuing the directive instructing local officials to comply with regulations on grants given by the United States.

“OIA is definitely trying to make it almost impossible for the local government to spend the federal reimbursement without having to comply with guidelines that are both irrelevant and seriously questionable,” Mr. Reyes said in a statement.

The Saipan lawmaker stressed the move is tantamount to dictating the government what it needs to do on the reimbursement that he said in the first place is CNMI’s own money used in assisting Micronesians.

Local expenditure policy should be applied to the $1 million, and not the federal policy which he said must be used only for grants and funds given by the U.S. government under the Covenant or any bilateral agreement, he said.

“Compact reimbursement funds are neither federal funds nor Covenant funds, but simply a re-payment of the funds owed to the CNMI by the federal government,” explained Mr. Reyes.

“Once again, the office of Mr. Aranza is dictating to the local government despite our Commonwealth’s authority to govern ourselves internally and consistent with our Covenant, and our own legislative and executive authorities granted under our local constitution,” he added.

Mr. Aranza personally traveled to Saipan last Oct. 26 to turn over the money to Lt. Gov. Jesus R. Sablan, along with the $11 million for capital improvement projects under Covenant 702 funds.

He told island officials that while the CNMI was getting only a small share, it was already a significant contribution which would help the government in its various infrastructure projects as well as service programs.

The $1 million was meant to pay the Commonwealth for the cost of hosting the immigrants from Palau, the Federated States of Micronesia and the Marshall Islands.

The local government has spent between $80 million to $108 million in helping FAS citizens establish residency here since the Compact took effect in 1986 allowing them to enter freely into any U.S. jurisdiction as non immigrants.

Mr. Reyes expressed disappointment that OIA remains insensitive to the financial difficulties confronting the CNMI and how “we are falsely instructed once again to abide by artificial policies” which he said are reminiscent of the old practice under the Trust Territory colonies.