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Saipan. We have undertaken some construction projects. At this point we need funds to continue on the basic water transmission system and storage.

AMERICAN MEMORIAL PARK IN SAIPAN

Also, Mr. Chairman, again this year we are asking for consideration by the Committee regarding the appropriation of $3 million for development of the American Memorial Park on Saipan. This park was intended during the status negotiations between the United States and the Northern Marianas to be developed as a living memorial to honor those that died during the war. Authorization for this park was made in Public Law 95–348 several years already. And every year we try to get some funds out so we can begin to implement the recommendations of a joint master plan that was developed between our government and the United States National Park Service. We recognized how constrained the budget is for the United States but, Mr. Chairman, if there is any way that some funds could be made available to initiate some of the projects we have planned, we would appreciate it.

PROPOSED AMENDMENT OF PUBLIC LAW 99-396

Lastly, Mr. Chairman, I want to register our disagreement with the proposed amendment of Public Law 99-396 as requested by OTIA, and this has to do with the language in that law on the inclusion of all terms and conditions. I think that the Congress had made a determination that Public Law 99-396 covers only some of the conditions of the agreement and not the entire agreement.

That is our statement, Mr. Chairman. Thank you.

[The statement of Pedro A. Tenorio, Benjamin T. Mangloria, and Pedro R. Guerrero follow:)

84-150

0-88_-34

STATEMENT

OF

LT. GOVERNOR PEDRO A. TENORIO

COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

BEFORE THE

SUBCOMMITTEE ON INTERIOR AND RELATED AGENCIBS

HOUSE APPROPRIATIONS COMMITTEE

UNITED STATES CONGRESS

APRIL 26, 1988

MR. CHAIRMAN AND HONORABLE MEMBERS OF THIS COMMITTEE. FROM THE NORTHERN MARIANAS, WE BRING YOU GREETINGS AND A WARM "HAFA

ADAI".

AS ALWAYS, WE APPRECIATE THE INTEREST THAT THE CONGRESS

DEMONSTRATES IN THE WELFARE OF OUR COMMONWEALTH. IT IS THROUGH

THIS INTEREST AND ASSISTANCE YOU HAVE GIVEN US THAT WE HAVE BEEN

ABLE TO DEVELOP OUR ISLANDS CLOSER TO ACHIEVING

SELF-SUFFICIENCY.

WITH ME TODAY IS OUR FINANCE DIRECTOR, MR. ELOY INOS, AND OUR

SPECIAL ASSISTANT FOR PLANNING AND BUDGET AFFAIRS, MR. JAMES

RIPPLE. THEY ARE JOINED BY THEIR ASSISTANTS MESSERS PEDRO P.

REYES AND JOAQUIN TEREGEYO.

ALSO WITH US TODAY ARE MR.

ERIC

SMITH, OUR ASSISTANT ATTORNEY GENERAL, AND MR. PEDRO SASAMOTO,

THE EXECUTIVE DIRECTOR OF OUR COMMONWEALTH UTILITIES

CORPORATION.

FROM OUR LEGISLATURE AND REPRESENTING THE SENATE

IS THE HONORABLE PRESIDENT BENJAMIN T. MANGLONA AND THE

HONORABLE PEDRO R. GUERRERO, SPEAKER OF THE HOUSE OF

REPRESENTATIVES.

TWO YEARS AGO, THE CONGRESS ENACTED AND THE PRESIDENT SIGNED

INTO LAW PUBLIC LAW 99-396.

THIS LAW PROVIDES, AMONG OTHERS,

FEDERAL FINANCIAL ASSISTANCE TO THE COMMONWEALTH OF THE NORTHERN

MARIANA ISLANDS (CNMI) FOR THE SECOND SEVEN YEAR CYCLE OF

FINANCIAL ASSISTANCE UNDER SECTION 702 OF PUBLIC LAW 99-241,

"THE COVENANT TO ESTABLISH THE COMMONWEALTH OF THE NORTHERN

MARIANA ISLANDS IN POLITICAL UNION WITH THE UNITED STATES".

SECTION 10 OF PUBLIC LAW 99-396 PLEDGED $228 MILLION OF DIRECT

GRANT ASSISTANCE TO THE COMMONWEALTH AT GUARANTEED ANNUAL

AMOUNTS FOR THE SEVEN FISCAL YEARS BEGINNING IN FY 1986.

PUBLIC LAW 99-396 MAKES REFERENCE TO CERTAIN PERFORMANCE

STANDARDS TO ACHIEVE EFFICIENCY IN THE DELIVERY OF GENERAL

GOVERNMENT OPERATIONS.

WE ARE PLEASED TO INFORM THE COMMITTEE

THAT WE HAVE MET THESE STANDARDS AND WE PLAN TO CONTINUE THE

TREND THAT WE HAVE ESTABLISHED.

ONE OF THESE STANDARDS OF THE

LAW REQUIRES THE COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

(CNMI) TO REDUCE ITS DEPENDENCY UPON THE FEDERAL GOVERNMENT FOR

FINANCIAL ASSISTANCE FOR OPERATIONS.

THIS WE HAVE DONE.

WE

HAVE REDUCED OUR DEPENDENCY FROM 66 PERCENT IN FISCAL YEAR 1978

TO 23 PERCENT FOR FISCAL YEAR 1988, WHICH WILL BE FURTHER

REDUCED TO 21 PERCENT DURING FISCAL YEAR 1989.

THIS HAS BEEN

ACCOMPLISHED WITHOUT ANY REDUCTION IN GOVERNMENT SERVICES, YET

WE CONTINUE TO PROVIDE A STABLE GOVERNMENT, AN EQUITABLE TAX

SYSTEM, AND AN ECONOMIC CLIMATE ATTRACTIVE TO PRIVATE SECTOR

INVESTMENTS COUPLED WITH LAW AND ORDER THAT ASSURES SAFETY TO

PERSONS AND PROPERTY.

THE CNMI HAS ESTABLISHED A POLICY TO MAINTAIN A LEVEL OF

GOVERNMENT CONSISTENT WITH THE NEED FOR SERVICES DEMANDED BY THE GENERAL PUBLIC AND TO MEET ITS CONSTITUTIONAL OBLIGATIONS.

THE

EXPENDITURES FOR GOVERNMENT OPERATIONS HAVE INCREASED ONLY SLIGHTLY SINCE THE FIRST FISCAL YEAR OF COMMONWEALTH STATUS IN

1978.

BUT THIS INCREASE HAS BEEN FAR LESS THAN THE ACTUAL AND

ANTICIPATED RATE OF ECONOMIC AND POPULATION GROWTH.

MEASURING THE SIZE OF GOVERNMENT BY COMPARING THE COST OF

GOVERNMENT TO THE GROSS ISLAND PRODUCT (GIP) DURING FISCAL YEAR

1979, THE FIRST FULL YEAR OF COMMONWEALTH STATUS, THE COST OF

GOVERNMENT WAS 16.4 PERCENT OF GIP.

THE SIZE OF THE CNMI

GOVERNMENT INCREASED TO 23.4 PERCENT OF GIP IN 1985.

THIS CAN

BE CONTRIBUTED TO INCREASED OUTLAYS FOR HEALTH CARE, WHEN WE
WERE STRIVING FOR CERTIFICATION FOR MEDICAID AND MEDICARE,
EXPANDED FUNDING FOR EDUCATION, AND THE IMPLEMENTATION OF A

RETIREMENT PLAN THAT WILL PROVIDE ADEQUATE INCOME FOR GOVERNMENT

EMPLOYEES DURING THEIR RETIREMENT YEARS.

THIS TREND REVERSED IN

1986 AND 1987 WITH THE COST OF GOVERNMENT DECREASING TO 19.2

PERCENT OF GIP. THIS REDUCTION HAS BEEN ACCOMPLISHED THROUGH

GRADUAL PRIVATIZATION OF SOME OF OUR UTILITIES, BETTER TRAINING OF GOVERNMENT EMPLOYEES, AND OTHER IMPROVEMENTS IN THE DELIVERY

OF PUBLIC SERVICES.

ALL UTILITY FUNCTIONS PREVIOUSLY RUN BY OUR EXECUTIVE BRANCH

DEPARTMENT HAVE BEEN TRANSFERRED TO THE STATUTORILY CREATED

COMMONWEALTH UTILITIES CORPORATION (CUC) EFFECTIVE OCTOBER 1,

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