§5 Self-Governing and Non-Self-Governing Federal Territorial Policy In a message to the Congress, dated February 14, 1980, President Carter announced the framework for a comprehensive Federal territorial policy towards Guam, the United States Virgin Islands, American Samoa, and the Northern Mariana Islands, that would strengthen the United States commitment to encouraging the self-determined political, economic, and social development of its territories. The comprehensive policy included proposals for both legislative and administrative action, that had been formulated through an intensive review carried out in consultation with elected officials of the territories and Members of Congress and had the following as its goals: (1) detailing a procedure for the orderly political development of the territories; (2) providing opportunity for and a stimulus to their economic growth; (3) rationalizing the existing Federal-territorial financial relationship and improving local financial management; (4) enhancing territorial treatment under Federal programs; and (5) elevating the Federal organization for dealing with territorial matters. Excerpts from the President's message follow: POLITICAL DEVELOPMENT In keeping with our fundamental policy of self-determination, all options for political development should be open to the people of the insular territories so long as their choices are implemented when economically feasible and in a manner that does not compromise the national security of the United States. If the people of any of the territories wish to modify their current political status, they should express their aspirations to the Secretary of the Interior through their elected leaders, as is the case now. The Secretary, along with representatives of the appropriate Federal agencies, will in turn, consult with territorial leaders on the issues raised. Following such discussions, a full report will be submitted to the Congress, along with the Secretary's proposals and recommendations. This procedure will permit an orderly development of the Federal-territorial_relationship. To maximize local self-determination, however, I want to encourage the people of Guam and the Virgin Islands to continue in the constitution-drafting process. By doing so, they will in due course replace the Federal laws under which their local governments now function with instruments of their own design. The Secretary of the Interior will also make recommendations to me on the other proposals for political development considered during the Administration's Domestic Policy Review, including: Federal court reform in Guam and the Virgin Islands, Congressional representation for the Northern Mariana Islands, and other changes in current law. ECONOMIC DEVELOPMENT Attainment of the political aspirations of the people of the territories, as well as the quality of their lives, is vitally dependent on the economic viability of these insular areas. Therefore, this policy framework places special emphasis on furthering the economic development of each of these areas. As with other aspects of this policy, the Department of the Interior will be given new responsibilities to accomplish this end. Chief among these will be coordination of the work of the Federal government's economic development agencies with respect to the territories. So that we may make sense out of the somewhat confused pattern of Federal laws that now apply or fail to apply to the territories, I will propose legislation to establish a Presidential Commission to examine the application of Federal statutes on a case-by-case basis to Guam, the Virgin Islands and American Samoa. On this Commission, representatives of each of the territories would join Federal legislative and executive representatives in recommending legislation to the President for his submission to Congress. The Commission would not examine the applicability of Federal laws to the Northern Mariana Islands because our Covenant with that Commonwealth stipulates the appointment of a separate commission for that purpose. I will shortly appoint members to that Commission. I will also direct the Department of the Interior, with the assistance of Federal economic development agencies, to undertake an analysis of Federal constraints on territorial economic expansion. This study will provide information and policy guidelines for the Commissions on Federal laws and will propose concrete action to remove administratively-imposed constraints. I have, further, directed the Secretary of the Interior to devise methods of encouraging private sector development in the territories by providing technical training and public and private financing assistance. Again, in this effort the Secretary of the Interior will coordinate the involvement of all relevant agencies, particularly the Economic Development Administration of the Department of Commerce, which I expect to play a major role in fostering the growth of the private sector in the territories. CAPITAL DEVELOPMENT Federal constraints, the need for technical assistance and training, and the lack of local venture capital are not the only factors inhibiting private sector growth in the territories. There is also a serious need to develop and maintain the basic capital infrastructure to meet business and human requirements. In many of the islands, meaningful economic growth-as well as a decent standard of living-will be an unattainable dream unless elementary facilities are constructed. My 1981 Budget recognizes this fact. In it I have proposed substantial Federal support for several essential capital improve ment projects. The funding level proposed would have the Federal government finance 90 percent of the cost of these projects. This method of cost-sharing of capital improvement projects in the territories is a major element of the territorial assistance proposals I announce today. I urge that it be standardized until the territories become sound enough financially to assume a greater portion of the cost of needed projects. JOINT FEDERAL-TERRITORIAL PLANNING To plan and set priorities for territorial capital development, my Administration will propose a program for joint Federal-territorial, comprehensive, multi-year planning, financed by Federal grants. This planning will serve other purposes as well. It will help to improve the effectiveness of Federal grant programs in the territories and it will assist the territories to better manage their finances. FEDERAL GRANT PROGRAMS Several other initiatives will be undertaken by my Administration to enhance the effectiveness and usefulness of Federal grant programs, including: -encouragement to territorial governors to strengthen their grant coordinating units and to participate in joint planning efforts, -a directive to all Federal agencies to keep the Department of the Interior informed of all grant applications and decisions affecting the territories and to provide it with data related to the applications and the programs to which they apply, -a waiver of matching requirements for programs or projects the Federal government wants to encourage in the territories, and -development of a test proposal to provide the territories with block grants replacing the categorical grants-in-aid which the territories find increasingly difficult to administer effectively. FINANCIAL ASSISTANCE The initiatives I propose to ameliorate territorial financial difficulties are part of a major revision of the financial relationship between Washington and the territories. This change is designed to promote greater self-reliance in the territories. It recognizes that somewhat greater levels of assistance are required in the short run to enable the territories to be more self-sufficient in the long run. It focuses on capital improvements, economic development, and gradually increasing territorial contributions to the funding of local programs and projects. Thus, while my Administration will continue to oppose measures that provide a disincentive to prudent budget practices I will submit legislation designed to enable Guam and the Virgin Islands to alleviate immediate and near-term budgetary pressures while improving their financial management practices. To increase territorial revenues, I propose that we fully extend the Internal Revenue Code, now limited to the States and the District of Columbia, to the territories. I will submit legislation similar to S. 2017, sponsored by Senator Johnston, that will replace the so-called "mirror" systems of income taxation imposed by Federal law and eliminate restrictions on the local imposition of a local income tax. This measure would provide the territories with many advantages in addition to according them State-like Federal income tax treatment. Collections by the Internal Revenue Service would be covered over to territorial treasuries for an anticipated significant net gain. Anomalies in current tax laws would be eliminated, encouraging business activity and increasing collections. Employees of territorial tax agencies would be given preference in hiring for Internal Revenue Service positions in their territories. And the legislation would create new incentives for business investment. Weekly Comp. of Pres. Docs., Vol. 16, No. 7, Feb. 18, 1980, pp. 319-322. The President also announced certain reorganization measures within the Executive Branch to help implement the policy initiatives, ante. Ibid., p. 319. In addition, on May 14, 1980, the United States Government transferred to Guam, the Virgin Islands and American Samoa "all right, title, and interest of the United States in deposits of oil, gas, and other minerals" in submerged lands within three miles from their territorial coastline. The transfer was effected pursuant to P.L. 96-205, Title VI, §605, approved Mar. 12, 1980, 94 Stat. 84, 91; 48 U.S.C. 1705(d). American Samoa Speaking on October 21, 1980 before the Fourth Committee of the United Nations General Assembly, United States Ambassador H. Carl McCall reviewed developments in American Samoa during the past year: American Samoa is in the midst of a lively political campaign, due to culminate on November 4 with the election for the first time of a Samoan Delegate to the U.S. Congress, and for the second time an elected governor for the territory. In local government, we are pleased to report the appointment of the first Samoan to the Office of Attorney General of the territory. This past year marked the advent of a wide variety of public works programs in the territory to bolster the local economy and to provide essential services to the people of the territory. These included projects on electrical power, airport expansion, fisheries, roads and bridges, all designed to provide the infrastructure for economic diversification. We wish to note also the growing trade links between American Samoa and Western Samoa, which has resulted in a number of cooperative projects, including the shipment of hardwood lumber to the United States. Earlier this year, our representative reported to the Subcommittee on Small Territories that the locally constituted Second Temporary Political Status Study Commission had concluded its review and published its recommendations. It concluded that the most suitable political status for American Samoa at this time is to continue as an unincorporated and unorganized territory of the United States, but with some modifications. The report, along with the recommended modifications, is being reviewed by the United States with the elected leadership of American Samoa. Among the recommendations is a proposal for the creation of a Third Commission in the future to reexamine the situation regarding future status. In accordance with this systematic review by the American Samoan people of their political status, and consistent with our desire to work constructively with the Special Committee on Decolonization, we are prepared to arrange for a visiting mission to American Samoa in 1981. My government looks forward to working closely with the committee in planning such a mission. Press Release, USUN 115(80), Oct. 21, 1980. In the Nov. 4 election referred to, Fofo I.F. Sunia was elected as the first delegate from American Samoa to the United States Congress. Governor Peter T. Coleman was reelected for a second term. -J.M.S. Guam In his statement on October 21, 1980 before the Fourth Committee of the United Nations General Assembly, Ambassador McCall reported on developments in Guam during the previous year: Following the defeat of a proposed constitution in the 1979 referendum, the Guam Legislature and the Governor of Guam introduced legislation calling for the creation of a Guamanian Commission on Self-Determination. Such a commission was created by Public Law 15-128 on May 31, 1980. The purpose of the Commission is to ascertain the desire of the people of Guam as to their future political relationship with the United States. Under the act, task forces were created to prepare position papers on various political status options, including statehood, independence or free association, incorporated territorial status, commonwealth status, or the status quo. The Commission is composed of 15 members representing the executive and legislative branches of the Guam government and the private sector. At the request of the Governor of Guam, the United States has decided to sponsor Guam for Associate membership in the UN Economic and Social Commission for Asia and the Pacific. As an associate member, Guam will be able to participate more fully in ESCAP regional activities. |