    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

      IMPLEMENTATION OF P.L. 110-229 TO THE COMMONWEALTH OF THE NORTHERN
     MARIANA ISLANDS (CNMI) AND GUAM; H.R. 1466, TO RESOLVE THE STATUS OF
      CERTAIN PERSONS LEGALLY RESIDING IN THE CNMI UNDER THE IMMIGRATION
    LAWS OF THE U.S.; AND H.R. 44, ``GUAM WORLD WAR II LOYALTY RECOGNITION
                                    ACT.''
    =======================================================================

                       OVERSIGHT AND LEGISLATIVE HEARING

                                   before the

                      SUBCOMMITTEE ON FISHERIES, WILDLIFE,

                           OCEANS AND INSULAR AFFAIRS

                                     of the

                         COMMITTEE ON NATURAL RESOURCES

                         U.S. HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                            Thursday, July 14, 2011

                                   __________

                               Serial No. 112-49

                                   __________

           Printed for the use of the Committee on Natural Resources

             Available via the World Wide Web: http://www.fdsys.gov
                                       or
              Committee address: http://naturalresources.house.gov

                      U.S. GOVERNMENT PRINTING OFFICE
    67-403                    WASHINGTON : 2012
    -----------------------------------------------------------------------
    For sale by the Superintendent of Documents, U.S. Government Printing
    Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC
    area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC
    20402-0001

                         COMMITTEE ON NATURAL RESOURCES

                           DOC HASTINGS, WA, Chairman
                 EDWARD J. MARKEY, MA, Ranking Democrat Member

    Don Young, AK                        Dale E. Kildee, MI
    John J. Duncan, Jr., TN              Peter A. DeFazio, OR
    Louie Gohmert, TX                    Eni F.H. Faleomavaega, AS
    Rob Bishop, UT                       Frank Pallone, Jr., NJ
    Doug Lamborn, CO                     Grace F. Napolitano, CA
    Robert J. Wittman, VA                Rush D. Holt, NJ
    Paul C. Broun, GA                    Raul M. Grijalva, AZ
    John Fleming, LA                     Madeleine Z. Bordallo, GU
    Mike Coffman, CO                     Jim Costa, CA
    Tom McClintock, CA                   Dan Boren, OK
    Glenn Thompson, PA                   Gregorio Kilili Camacho Sablan,
    Jeff Denham, CA                          CNMI
    Dan Benishek, MI                     Martin Heinrich, NM
    David Rivera, FL                     Ben Ray Lujan, NM
    Jeff Duncan, SC                      John P. Sarbanes, MD
    Scott R. Tipton, CO                  Betty Sutton, OH
    Paul A. Gosar, AZ                    Niki Tsongas, MA
    Raul R. Labrador, ID                 Pedro R. Pierluisi, PR
    Kristi L. Noem, SD                   John Garamendi, CA
    Steve Southerland II, FL             Colleen W. Hanabusa, HI
    Bill Flores, TX                      Vacancy
    Andy Harris, MD
    Jeffrey M. Landry, LA
    Charles J. ``Chuck'' Fleischmann,
        TN
    Jon Runyan, NJ
    Bill Johnson, OH

                           Todd Young, Chief of Staff
                          Lisa Pittman, Chief Counsel
                    Jeffrey Duncan, Democrat Staff Director
                     David Watkins, Democrat Chief Counsel
                                     ------

                  SUBCOMMITTEE ON FISHERIES, WILDLIFE, OCEANS
                              AND INSULAR AFFAIRS

                           JOHN FLEMING, LA, Chairman
         GREGORIO KILILI CAMACHO SABLAN, CNMI, Ranking Democrat Member

    Don Young, AK                        Eni F.H. Faleomavaega, AS
    Robert J. Wittman, VA                Frank Pallone, Jr., NJ
    Jeff Duncan, SC                      Madeleine Z. Bordallo, GU
    Steve Southerland, II, FL            Pedro R. Pierluisi, PR
    Bill Flores, TX                      Colleen W. Hanabusa, HI
    Andy Harris, MD                      Vacancy
    Jeffrey M. Landry, LA                Edward J. Markey, MA, ex officio
    Jon Runyan, NJ
    Doc Hastings, WA, ex officio

                                     ------
                                    CONTENTS

                                  ----------
                                                                       Page

    Hearing held on Thursday, July 14, 2011..........................     1

    Statement of Members:
        Bordallo, Hon. Madeleine Z., a Delegate in Congress from Guam    81
            Prepared statement of....................................    86
        Duncan, Hon. Jeff, a Representative in Congress from the
          State of South Carolina, Statement submitted for the record
          on H.R. 44.................................................   121
        Fleming, Hon. John, a Representative in Congress from the
          State of Louisiana.........................................     2
            Prepared statement of....................................     2
        Landry, Hon. Jeffrey M., a Representative in Congress from
          the State of Louisiana.....................................    79
            Prepared statement of....................................    80
        Sablan, Hon. Gregorio, a Delegate in Congress from the
          Commonwealth of the Northern Mariana Islands, Oral
          statement on implementation of P.L. 110-229................     3
            Oral statement on H.R. 44................................    81
            Prepared statement of....................................     5

    Statement of Witnesses:
        Aldan-Pierce, Marian, Chairperson, Board of Directors,
          Marianas Visitors Authority................................    45
            Prepared statement on H.R. 1466..........................    47
        Blaz, Brigadier General Vicente G., ``Ben,'' USMC (Ret.),
          Former Member of Congress from Guam........................   107
            Prepared statement on H.R. 44............................   108
        Calvo, Hon. Eddie Baza, Governor, Island of Guam.............
            Oral statement on P.L. 110-229...........................    16
            Prepared statement on P.L. 110-229.......................    18
            Oral statement on H.R. 44................................    90
            Prepared statement on H.R. 44............................    91
        Doctor, Hazel Marie, CNMI Resident...........................    56
            Prepared statement on H.R. 1466..........................    57
        Fitial, Hon. Benigno Repeki, Governor, Commonwealth of the
          Northern Mariana Islands...................................     8
            Prepared statement on P.L. 110-229 and H.R. 1466.........    10
            Response to questions submitted for the record...........    15
        Gootnick, David, Director, International Affairs and Trade,
          U.S. Government Accountability Office......................    24
            Prepared statement on H.R. 1466..........................    25
            Highlights...............................................    34
        Pula, Nikolao I., Jr., Director, Office of Insular Affairs,
          U.S. Department of the Interior............................    39
            Prepared statement on P.L. 110-229 and H.R. 1466.........    41
            Oral statement on H.R. 44................................    99
            Prepared statement on H.R. 44............................   101
        Ryan, Kelly, Acting Deputy Assistant Secretary for Policy,
          Office of Immigration and Border Security, U.S. Department
          of Homeland Security.......................................    35
            Prepared statement on H.R. 1466..........................    37
        Tamargo, Hon. Mauricio, Former Chairman, Guam War Claims
          Review Commission, and Former Chairman, United States
          Foreign Claims Settlement Commission.......................   102
            Prepared statement on H.R. 44............................   104
            Response to questions submitted for the record...........   106

    Additional materials supplied:
        Americans for Tax Reform, Center for Fiscal Responsibility,
          Letter submitted for the record on H.R. 44.................    88
        Blas, Frank F., Minority Leader, 31st Guam Legislature,
          Statement submitted for the record in support of H.R. 44...   118
        Bock, Valerie J., Resident of Guam, Statement submitted for
          the record on H.R. 44......................................   119
        Cruz, Hon. Benjamin J.F., Vice Speaker, 31st Guam Legislature
            Statement submitted for the record on H.R. 44............   120
            Statement submitted for the record on implementation of
              P.L. 110-229...........................................   120
        Guerrero, Susana Blas Deleon, President, CNMI Women's
          Association, Statement submitted for the record on H.R.
          1466.......................................................   122
        The Heritage Foundation, ``Wrong Way on Reparations''
          published on May  22, 2007.................................    89
        Manglona, Hon. Paul A., President of the Senate, 17th
          Northern Marianas Commonwealth Legislature, Statement
          submitted for the record on implementation of P.L. 110-229
          and H.R. 1466..............................................   123
        Won Pat, Hon. Judith T., Ed.D., Speaker, 31st Guam
          Legislature, Statement submitted for the record on
          implementation of
          P.L. 110-229...............................................    82

                                      (IV)

       OVERSIGHT HEARING ON IMPLEMENTATION OF PUBLIC LAW 110-229 TO THE
    COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS AND GUAM; AND LEGISLATIVE
    HEARING ON H.R. 1466, TO RESOLVE THE STATUS OF CERTAIN PERSONS LEGALLY
    RESIDING IN THE COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS UNDER THE
      IMMIGRATION LAWS OF THE UNITED STATES; AND H.R. 44, RECOGNIZES THE
      SUFFERING AND THE LOYALTY OF THE PEOPLE OF GUAM DURING THE JAPANESE
        OCCUPATION OF GUAM IN WORLD WAR II. ``GUAM WORLD WAR II LOYALTY
                               RECOGNITION ACT.''

                                  ----------

                            Thursday, July 14, 2011

                         U.S. House of Representatives

        Subcommittee on Fisheries, Wildlife, Oceans and Insular Affairs

                         Committee on Natural Resources

                                Washington, D.C.

                                  ----------

        The Subcommittee met, pursuant to call, at 10:04 a.m. in
    Room 1324, Longworth House Office Building, The Honorable John
    Fleming [Chairman of the Subcommittee] presiding.
        Present: Representatives Fleming, Young, Duncan, Harris,
    Landry, Sablan, Faleomavaega, Bordallo, Pierluisi, and
    Hanabusa.
        Mr. Fleming. The Subcommittee will come to order. The
    Chairman notes the presence of a quorum. Good morning. Today
    the Subcommittee on Fisheries, Wildlife, Oceans, and Insular
    Affairs will conduct, in essence, two hearings. The first panel
    will be an oversight hearing on Title VII of Public Law 110-229
    which requires the application of Federal immigration laws in
    the Commonwealth of the Northern Mariana Islands and a
    legislative hearing on H.R. 1466, a bill to resolve the status
    of certain persons legally residing in the Commonwealth of the
    Northern Mariana Islands under the immigration laws of the
    United States.
        The second panel will be a legislative hearing at the
    request of the gentlelady from Guam, Mrs. Bordallo, on H.R. 44,
    the Guam World War II Loyalty Recognition Act. I will ask that
    witnesses only testify on the issues specific to each panel.
        Under Committee Rule 4(f), opening statements are limited
    to the Chairman and Ranking Member of the Subcommittee so that
    we can hear from our witnesses more quickly. However, I ask
    unanimous consent to include any other Members' opening
    statements in the hearing record if submitted to the clerk by
    close of business today. Hearing no objection, so ordered.

     STATEMENT OF THE HON. JOHN FLEMING, A REPRESENTATIVE FROM THE
                           STATE OF LOUISIANA

        Mr. Fleming. One of the first items under consideration
    today is Public Law 110-229, the Consolidated Natural Resources
    Act which was enacted in 2008. The United States and the
    Northern Mariana Islands entered into a political union in 1976
    with the enactment of the covenant to establish the
    Commonwealth of the Northern Mariana Islands as a self-
    governing entity under the sovereignty of the United States.
        Under the covenant, the Northern Mariana Islands were
    exempt from Federal immigration laws which allowed the local
    government to control immigration. In 2008, Congress amended
    the covenant to require the application of Federal immigration
    laws in the Northern Mariana Islands. The law created a five-
    year transition period to allow for a smooth conversion from
    local to Federal control over immigration.
        As stated in law, it was the intent of Congress for the
    orderly phasing in of Federal responsibilities over immigration
    in the Northern Mariana Islands. The law's intent was to
    minimize, to the greatest extent practicable, potential adverse
    economic and fiscal effects by encouraging diversification and
    growth of the economy. It was also intended to assist the
    Commonwealth in achieving progressively higher standards of
    living for its citizens and giving it as much flexibility as
    possible in maintaining existing businesses and other revenue
    sources while developing new opportunities consistent with
    Federal law and mandates of Public Law 110-229.
        The Subcommittee is interested in hearing from today's
    witnesses how the implementation of the various provisions
    required in the law has progressed since the effective date of
    November 28, 2009.
        We will also hear testimony on H.R. 1466, a bill introduced
    by Ranking Member Sablan to address the status of certain
    individuals living legally in the Northern Mariana Islands who
    will be adversely affected by the extension of Federal
    immigration laws to the Northern Mariana Islands. Approximately
    4,000 legal residents of the Northern Mariana Islands will be
    affected by the full implementation of Federal immigration laws
    set to occur on November 28, 2011. H.R. 1466 will allow these
    residents of the Northern Mariana Islands to maintain their
    current legal status and provide them with the opportunity to
    adjust their status under the Federal immigration laws.
        I look forward to hearing the testimony of our
    distinguished witnesses.
        [The prepared statement of Mr. Fleming follows:]

              Statement of The Honorable John Fleming, Chairman,
        Subcommittee on Fisheries, Wildlife, Oceans and Insular Affairs

        Good morning, today the Subcommittee on Fisheries, Wildlife, Oceans
    and Insular Affairs will conduct in essence two hearings. The first
    panel will be an oversight hearing on the implementation of title VII
    of Public Law 110-229, which required the application of federal
    immigration laws in the Commonwealth of the Northern Mariana Islands,
    and a legislative hearing on H.R. 1466, a bill to resolve the status of
    certain persons legally residing in the Commonwealth of the Northern
    Mariana Islands under the immigration laws of the United States. The
    second panel will be a legislative hearing at the request of the gentle
    lady from Guam, Mrs. Bordallo on H.R. 44, the Guam World War II Loyalty
    Recognition Act. I will ask that witnesses only testify on the issues
    specific to each panel.
        One of the first items under consideration today is Public Law 110-
    229, the Consolidated Natural Resources Act, which was enacted in 2008.
        The United States and the Northern Mariana Islands entered into a
    political union in 1976 with the enactment of the Covenant to establish
    the Commonwealth of the Northern Mariana Islands as a self-governing
    entity under the sovereignty of the United States. Under the Covenant,
    the Northern Mariana Islands were exempt from federal immigration laws
    which allowed the local government to control immigration.
        In 2008, Congress amended the Covenant to require the application
    of federal immigration laws in the Northern Mariana Islands. The law
    created a 5-year transition period to allow for a smooth conversion
    from local to federal control over immigration.
        As stated in the law, it was the intent of Congress for the
    `orderly phasing-in of federal responsibilities over immigration' in
    the Northern Mariana Islands. The law's intent was to minimize, to the
    greatest extent practicable, potential adverse economic and fiscal
    effects by encouraging diversification and growth of the economy. It
    also is intended to assist the Commonwealth in achieving progressively
    higher standards of living for its citizens and giving it as much
    flexibility as possible in maintaining existing businesses and other
    revenue sources, while developing new economic opportunities,
    consistent with federal law and the mandates of Public Law 110-229.
        The Subcommittee is interested in hearing from today's witnesses
    how the implementation of the various provisions required in the law
    has progressed since the effective date of November 28, 2009.
        We will also hear testimony on H.R. 1466, a bill introduced by our
    Ranking Member, Mr. Sablan, to address the status of certain
    individuals living legally in the Northern Mariana Islands who will be
    adversely affected by the extension of federal immigration laws to the
    Northern Mariana Islands.
        Approximately 4,000 legal residents of the Northern Mariana Islands
    will be affected by the full implementation of federal immigration laws
    set to occur on November 28, 2011. H.R. 1466 will allow these residents
    of the Northern Mariana Islands to maintain their current legal status
    and provide them with the opportunity to adjust their status under the
    federal immigration laws.
        I look forward to hearing the testimony of our distinguished
    witnesses, and now recognize our Ranking Member Mr. Sablan, for any
    statement he would like to make.
                                     ______

        Mr. Fleming. I now recognize our Ranking Member, Mr.
    Sablan, for any statement he would like to make.

      STATEMENT OF THE HON. GREGORIO SABLAN, A DELEGATE FROM THE
              COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

        Mr. Sablan. Thank you. Thank you very much, Chairman
    Fleming, and thank you again for holding this hearing this
    morning on the progress of Public Law 110-229 on my H.R. 1466
    and obviously, of course, H.R. 44.
        I don't know if you saw the data on the Gross Domestic
    Product in the Northern Mariana Islands that was released
    yesterday, but the economic situation just gets worse and
    worse. Between 2002 and 2009, GDP was cut in half. In 2008, GDP
    fell 12 percent. In 2009, it fell 20 percent. Prices are going
    up and incomes are coming down. This all happened before Public
    Law 110-229 really took effect so we can't say that Federal
    immigration created this problem, but Federal management of the
    transition from local to Federal control has made it more
    difficult to solve the economic problem. Public Law 110-229 was
    supposed to ``expand economic development in the
    Commonwealth'', but it has not.
        We have had some successes in the form of security in the
    department most responsible for the law. When I was first
    elected, Public Law 110-229 was just about to go into effect,
    DHS was not ready however. So, along with other Commonwealth
    officials, including our Governor, we convinced Secretary
    Napolitano to push back implementation by six months. That
    helped.
        When DHS published rules on the visa waiver program created
    by P.L. 110-229, Russia and China were excluded, but tourism
    from these countries was growing and the Northern Marianas
    needed the visitors, so we convinced Secretary Napolitano to
    use her parole authority to keep Russians and Chinese
    continuing to come to the Northern Marianas, and that helped.
        But the parole system is only a stop gap. It can be revoked
    at any time. It does not encourage new investment in the
    Russian and Chinese markets. Today, DHS needs to tell us its
    plans to normalize the system and fulfill the intent of Public
    Law 110-229 to, ``expand tourism''.
        There has been other problems, some solved, some still
    outstanding. The biggest unresolved problem is the lack of
    regulations covering guest workers. The purpose of Public Law
    110-229 is to zero out guest workers and replace them with
    Americans. We know this transition has to be managed carefully,
    so businesses still have the skilled labor they need.
        In October of 2009, DHS did publish regulations explaining
    how to hire these workers, but Governor Fitial went to court
    and enjoined the regulations. Now almost two years later we
    still don't have the regulations and employers are supposed to
    use them for hiring starting in November. We often hear that
    regulations are very bad for business. Well, in this case the
    lack of regulations is bad for business. We need answers from
    DHS today about why is it taking so long to get their work
    done, when we can expect it to be done, and whether they will
    meet the policy goals of Public Law 110-229.
        Chairman Fleming, I also want to thank you for including my
    bill, H.R. 1466, on the agenda today. You and I talked about
    the families that will be protected by my bill back in January.
    I will never forget what you said. These people have been
    whipsawed, and that is exactly right. One of today's witnesses,
    Hazel Doctor, is a citizen of the United States who has been
    whipsawed by this law. She was born in America. She has lived
    there all her life. Hazel's parents are contract workers from
    the Philippines. They are legal residents. They have lived in
    the Northern Marianas for over 20 years, but Public Law 110-229
    will require them to leave. Congress did not take into account
    how this requirement will affect U.S. citizens like Hazel. They
    will have to choose between staying in the only home they have
    ever known or leaving with their parents to live in a place
    they have never known.
        Let me say that again because it is important. Public Law
    110-229 is asking U.S. citizens to choose between their country
    and their families, and that is wrong. H.R. 1466 would fix the
    problem. Keep families together and keep Americans in America.
        I was very glad to see in yesterday's paper that Interior
    Assistant Secretary Anthony Babauta, who is presently in the
    Marianas, thinks that H.R. 1466 is a good start, and I
    certainly look forward to working with the Administration to
    fine-tune the legislation. But I want to emphasize several
    points because I know H.R. 1466 will be criticized today and
    because we all know that immigration is a hot-button issue.
        First, individuals covered in H.R. 1466 are not immigrants.
    They did not cross over the U.S. immigration border. Rather,
    Public Law 110-229 extended the border over them so they are
    not and should not be part of the national immigration debate.
        Second, this bill has nothing to do with amnesty. Amnesty
    is for illegals. H.R. 1466 covers people who are legally
    admitted under the law of the Northern Mariana Islands. To
    qualify under H.R. 1466, an individual must still be in lawful
    status and in full compliance with the standards of the
    Immigration and Nationality Act.
        Third, H.R. 1466 provides no new social benefits and adds
    no new societal costs. In fact, by stabilizing the population
    and the workforce, H.R. 1466 will have a tremendous positive
    economic impact.
        I want to thank the bipartisan professional staff of the
    Judiciary and other House and Senate committees who assisted
    over the last year-and-a-half in drafting H.R. 1466, and the 24
    Members of Congress from both sides of the aisle who are
    cosponsors. They understand that H.R. 1466 simply corrects the
    oversights in Public Law 110-229 and keeps families together,
    particularly U.S. citizen families.
        And finally, let me welcome our panelists. First, I want to
    welcome my Governor, Governor Benigno Fitial from the Northern
    Marianas and I want to welcome Governor Eddie Calvo, both of
    whom have made the physically demanding trip here to Washington
    to join us today. Thank you, Governors.
        I would also like to welcome Ms. Marian Aldan-Pierce,
    Chairman of the Marianas Visitors Authority. She is President
    of Duty-Free Shops, one of the most important corporations
    doing business in the Northern Marianas, Guam, Hawaii, and
    worldwide. Let me welcome Ms. Hazel Doctor who will be
    testifying in support of H.R. 1466, and welcome to the Federal
    witnesses, Dr. David Gootnick, Mr. Nick Pula and Ms. Kelly Ryan
    from Homeland Security.
        Thank you, Mr. Chairman.
        [The prepared statement of Mr. Sablan follows:]

    Statement of The Honorable Gregorio Sablan, a Delegate in Congress from
                the Commonwealth of the Northern Mariana Islands

        Chairman Fleming, thank you again for agreeing to hold this
    hearing.
        I don't know if you saw the data on Gross Domestic Product in the
    Northern Mariana Islands that was released yesterday, but the economic
    situation just gets worse and worse.
        Between 2002 and 2009 GDP was cut in half. In 2008 GDP fell 12%. In
    2009 it fell 20%.
        Prices are going up. Incomes are going down.
        This all happened before Public Law 110-229 really took effect. So
    we can't say that federal immigration created this economic problem.
        But federal management of the transition from local to federal
    control has made it more difficult to solve the economic problem. And
    110-229 was supposed to--quote--``expand economic development in the
    Commonwealth.''
        We have had some successes with the Department of Homeland
    Security.
        When I was first elected to office, Public Law 110-229 was just
    about to go into effect.
        DHS was not ready, however.
        So, along with other officials, I convinced Secretary Napolitano to
    push back implementation by six months.
        That helped.
        When DHS published rules on the visa waiver program created by 110-
    229, Russia and China were excluded. But tourism from these countries
    was growing; and the Northern Marianas needed the visitors.
        So we convinced Secretary Napolitano to use her parole authority to
    keep Russians and Chinese coming to the Northern Marianas.
        That helped.
        But it's only a stop-gap. It can be revoked at any time. So this
    parole system does not encourage new investment in the Russian and
    Chinese markets.
        Today, DHS needs to tell us its plans to normalize the system and
    fulfill the intent of Public Law 110-229 to--quote--``expand tourism.''
        There have been other problems as well--some solved, some still
    outstanding.
        The biggest unresolved problem is the lack of regulations covering
    guest workers.
        The purpose of Public Law 110-229 is to zero out guest workers and
    replace them with Americans.
        We all know this transition has to be managed carefully, however,
    so businesses still have the skilled labor they need.
        In October 2009 DHS did publish regulations explaining how to hire
    these workers. But Governor Fitial went to court and blocked them.
        Now, almost two years later, we still don't have the regulations.
    And employers are supposed to use them for hiring, starting in
    November.
        We often hear that regulations are bad for business.
        Well, in this case the lack of regulations is bad for business.
        We need answers from DHS today about why it has taken so long to
    get their work done, when we can expect the regs, and whether those
    regs will meet the policy goals of 110-229.
        Chairman Fleming, I also want to thank you for including my bill,
    H.R. 1466, on the agenda today.
        You and I talked about the families that would be protected by my
    bill back in January. I will never forget what you said: ``These people
    have been whipsawed.''
        That's exactly right.
        One of today's witnesses, Hazel Doctor, is a citizen of the United
    States who has been whipsawed by this law. She was born in America. She
    has lived here all her life.
        Hazel's parents are contract workers from the Philippines. They are
    legal residents. They have lived in the Northern Marianas for over
    twenty years.
        But 110-229 will require them to leave.
        And Congress did not take into account how this requirement would
    affect U.S. citizens like Hazel.
        They will have to choose between staying in the only home they have
    ever known or leaving with their parents to live in a place they have
    never known.
        Let me say that again because it is important: Public Law 110-229
    is asking U.S. citizens to choose between their country and their
    families.
        That's wrong.
        H.R. 1466 would fix the problem, keep families together, and keep
    Americans in America.
        I want to emphasize several points--because I know H.R. 1466 will
    be criticized today and because we all know that immigration is a
    ``hot-button'' issue.
        First, individuals covered in H.R. 1466 are not immigrants. They
    did not cross over the U.S. immigration border. Rather Public Law 110-
    229 extended the border over them. So they are not and should not be
    part of the national immigration debate.
        Second, this bill has nothing to do with amnesty. Amnesty is for
    illegals. H.R. 1466 covers people who were legally admitted under the
    laws of the Northern Mariana Islands. To qualify under H.R. 1466
    individuals must still be in lawful status and in full compliance with
    the standards of the Immigration and Nationality Act.
        Third, H.R. 1466 provides no new social benefits and adds no new
    societal costs. In fact, by stabilizing the population and the
    workforce, H.R. 1466 will have a positive economic effect.
        I want to thank the bipartisan, professional staff of the Judiciary
    and other Senate and House Committees, who assisted over the last year
    and a half in drafting H.R. 1466, and the 23 Members of Congress--from
    both sides of the aisle--who are co-sponsors.
        They understand that H.R. 1466 simply corrects the oversights in
    Public Law 110-229 and keeps families together--particularly U.S.
    citizen families.
        Finally, let me welcome our panelists.
        Governor Benigno Fitial from the Northern Marianas and Governor
    Eddie Calvo of Guam made the physically demanding trek here to
    Washington to join us today. Thank you, Governors.
        I'd also like to welcome Ms. Marian Aldan-Pierce, Chair of the
    Marianas Visitors Authority. She is also the Saipan President of Duty
    Free Shoppers, one of the most important corporations doing business in
    both the Northern Marianas and Guam.
        Let me welcome again Ms. Hazel Doctor, who will be testifying in
    support of H.R. 1466.
        And welcome to our federal witnesses: Mr. David Gootnick from GAO,
    Mr. Nik Pula from the Interior Department, and Ms. Kelly Ryan from
    Homeland Security.
        The final bill on our agenda today is H.R. 44, the Guam World War
    II Loyalty Recognition Act that is sponsored by my colleague from Guam
    Congresswoman Bordallo.
        H.R. 44 would implement the recommendations of a federal commission
    that was authorized by the 107th Congress to look at this specific
    issue. The commission found that the people of Guam were treated
    unfairly during the war claims process immediately following the war as
    compared with claims programs authorized by Congress addressing
    similarly experienced losses and damages for other Americans. Each of
    the four Delegates from Guam to have served in the House has worked
    diligently to resolve this longstanding injustice faced by their
    constituents, and the text of H.R. 44 has passed the House on five
    separate occasions.
        It is long past time that we resolve this issue and provide relief
    for the people of Guam for the nearly three years of brutal occupation
    they suffered because of their steadfast loyalty to our country.
        Thank you again Mr. Chairman for allowing me to make this opening
    statement. I look forward to hearing from our witnesses.
                                     ______

        Mr. Fleming. I thank the gentleman. Thank you and we will
    now hear from our witnesses. Like all witnesses, your written
    testimony will appear in full in the hearing record, so I ask
    that you keep your oral statements to five minutes as outlined
    in our invitation letter to you and under Committee Rule 4(a).
    Our microphones are not automatic, so please press the button
    when you get ready, and I will also add you have to be sort of
    close. Sometimes we can't hear you if you are too far away from
    the microphone.
        I also want to explain how our timing lights work. Very
    simple. You have five minutes to give your testimony. The clock
    will run down under the green light to four minute to actually
    one minute left, and then you will get the yellow light and
    then after that minute you get the red light, and at that point
    we would want you to wrap up, of course.
        I would now like to welcome today's witnesses. First, The
    Honorable Governor Fitial from the Commonwealth of the Northern
    Mariana Islands. Welcome, sir.
        The Honorable Governor Calvo from Guam. We were just
    chatting before. I was actually stationed at the naval hospital
    on Guam 1979 and 1980, but even apart from that I did a lot of
    moonlighting in the emergency room at the island private
    hospital, or the community hospital there, and was actually
    director of the drug and alcohol program there as well, so I
    spent a lot of time with the community. I went to--I believe
    they are called festivals or fiesta, yes, with the most
    interesting type of rice that I have ever had, red rice. Very
    good. I have never asked what is in it, but it was delicious,
    and I did live in the community, lived in the Village of Yigo,
    and Perez Acres, which I understand is still there today. So we
    welcome you, sir.
        Mr. David Gootnick, Director, International Affairs and
    Trade, U.S. Government Accountability Office; Ms. Kelly Ryan,
    Acting Deputy Assistant Secretary for Immigration and Border
    Security, Office of Policy, Department of Homeland Security;
    Mr. Nik Pula, Director, Office of Insular Affairs, Department
    of the Interior; Ms. Marian Aldan-Pierce, President, Duty-Free
    Shops Saipan Limited; and Ms. Hazel Doctor, Northern Mariana
    Island resident testifying by video conference, and welcome to
    you. I am sure it is very early in the morning where you are
    today.
        Governor Fitial, you are recognized for five minutes, sir.
    You can go ahead with your testimony.

     STATEMENT OF THE HON. BENIGNO REPEKI FITIAL, GOVERNOR OF THE
              COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

        Governor Fitial. Mr. Chairman, Members of the Subcommittee,
    good morning. Thank you for the opportunity to appear before
    you today.
        Last year, I appeared before this Subcommittee in May and
    in September to comment on the Federal immigration law. I made
    these major points on both occasions.
        First, I brought to the Subcommittee's attention the
    failure of the Department of Homeland Security to provide the
    joint visa waiver program for the Commonwealth and Guam that
    was intended by Congress in Public Law 110-229. The Secretary's
    parole policy is not a satisfactory alternative.
        Second, I commented on the fact that the Department's
    immigration and customs enforcement component does not have an
    effective program in place to identify and remove illegal
    aliens from the Commonwealth.
        Third, I pointed out that the Department's customs and
    border protection component does not have an effective exit
    control method capable of preventing an increase in the number
    of illegal aliens in the Commonwealth.
        Nothing has changed for the better during the past year.
    Yes, the Commonwealth now does have Federal control of
    immigration. What we really have for the first time are all of
    the very serious immigration problems that exist here in the
    mainland. We have many illegal aliens who are not being
    deported. Some of these illegal aliens are employed illegally
    and take jobs away from U.S. citizens. Others are unemployed
    and survive on government benefits that provide an incentive
    not to leave the Commonwealth.
        Since Federal authority came into effect the Commonwealth
    has had an increased flow of tourists and others to enter on a
    temporary basis, but remain illegally hoping for amnesty that
    will provide a green card. The burden on taxpayers related to
    illegal and unemployed aliens is heavy.
        Congress recognized that the imposition of Federal control
    would work some hardship on the Commonwealth. It promised
    benefits that would outweigh these disadvantages. We have
    received none of these promised benefits like no effective visa
    waiver program, no technical assistance, no effective
    immigration enforcement, no new funding to compensate for the
    loss of immigration and other fees. Only if this Subcommittee
    is willing to underwrite a serious systemwide examination of
    the law and the need for its amendment will the Commonwealth
    see any hope for progress.
        With respect to H.R. 1466, I oppose the bill for these
    reasons. We estimate that there were approximately 23,000
    aliens, including illegals, in the Commonwealth at the end of
    2008, almost all of whom are adults. We believe that nearly all
    are still present in our community and that more than half of
    them are unemployed. Our current estimate is that the U.S.
    citizen population of the Commonwealth is about 30,000,
    including some 16,000 voters.
        H.R. 1466 creates four categories of potential new U.S.
    citizens. I want to focus on the fourth category, which covers
    alien parents of minor U.S. citizen children. Here is what will
    happen under H.R. 1466.
        1466 is a large-scale amnesty bill. It provides a direct
    route to U.S. citizenship that would create an estimated 11,000
    new U.S. citizens in the CNMI during the next decade, virtually
    all of whom would be voters. I do not believe that turning this
    large percentage of alien temporary workers into citizen voters
    would be tolerated in any county or state in the United States.
    These aliens would be provided permanent residence in the
    Commonwealth for all time. They are protected from deportation
    until their minor child of 21 years of age can petition for a
    grant of a green card for the parent leading to citizenship.
    This imposes a long-term burden on the Commonwealth that occurs
    nowhere else in the United States.
        The bill's sweeping terms cover a wide range of parents
    who, on closer examination, might not deserve the benefits
    offered by the legislation. It would include non-custodial
    parents, it would include unemployed and unemployable parents.
    It would include parents with no means of support. It would
    include parents with a history of illegal employment. It would
    include parents who left the CNMI and would return to obtain
    permanent residents in the Commonwealth provided by the bill.
    It includes parents who adopt a child up to the age of 21 just
    for the purpose of securing U.S. citizenship.
        H.R. 1466 has other critical defects. It strips away
    important safeguards of the Federal Administrative Procedures
    Act, and it refers to a definition of immediate relative from
    the Commonwealth code that was repealed by our Legislature
    sometime ago.
        Let me be very clear. It is the U.S. citizens in the
    Commonwealth who gave up their land and their sovereignty to
    become part of the United States. These U.S. citizens have the
    right to have their community and culture be so radically
    changed in this fashion unless they decide to do so through
    their own democratic institutions.
        Mr. Chairman, I have a proposal for an H-5 visa within the
    regular U.S. immigration system, and the CNMI Senate has a
    proposal for non-citizenship status somewhat akin to the status
    of freely associated state residents of the Commonwealth. Both
    of these proposals are far better alternatives for the people
    of the Commonwealth than H.R. 1466.
        I thank you.
        [The prepared statement of Governor Fitial follows:]

            Statement of The Honorable Benigno R. Fitial, Governor,
                  Commonwealth of the Northern Mariana Islands

        The Subcommittee has invited me to testify on the federalization
    law, Title VII of the CNRA (Public Law 110-22) and to comment on H.R.
    1466. I appreciate the opportunity to do so.
        Twice during 2010 I appeared before this Subcommittee to comment on
    the federalization law--on May 18, 2010 and September 16, 2010. Nothing
    has changed for the better since then. To some extent I have been
    tempted simply to resubmit my earlier testimony regarding the federal
    government's failure to honor Congressional intent and to implement the
    detailed provisions of the law in a timely, orderly, and constructive
    fashion.
        These were the major points which I made twice to the Subcommittee
    in 2010:
              Failure to grant visa waivers: The Department of
            Homeland Security's Interim Rule regarding the proposed Guam-
            CNMI joint visa waiver program did not comply with
            Congressional intent and is preventing the Commonwealth from
            its potential of significantly increasing visitors from China
            and Russia.
              Failure to deport illegal aliens: The Department's
            Immigration and Customs Enforcement unit does not have an
            effective program in place to identify and remove illegal
            aliens in the Commonwealth.
              Failure to monitor exits of tourists: The
            Department's Customs and Border Protection unit does not have
            an effective exit control method capable of preventing an
            increase in the number of illegal aliens in the Commonwealth.
              Failure to provide Congress with useful reports: The
            Government Accountability Office and the Department of the
            Interior have failed to provide the Congress with the kind of
            objective, useful reports assessing the implementation of the
            federalization law in a way that would assist this
            Subcommittee.
        One year later--and more than three years after the law was
    enacted--the situation continues to deteriorate and the Commonwealth
    suffers as a result. The uncertainty created by this law has created an
    unacceptable limbo situation that has severely hampered new investment
    and has created morale problems throughout our community. Many
    businesses have already lost their investments and others are expected
    to close if this situation is not rectified. Very few businesses have
    begun the process of applying for U.S. employment-based visas for their
    staffs due to the high cost and uncertainty in the regulations.
        This year I have made extensive personal efforts to try to improve
    this situation. I have met with officials with responsibilities for
    implementing the law in the three DHS components (USCIS, ICE and CBP),
    the Interior Department, and the U.S. Labor Department. I can report
    some progress based on these discussions.
        In my meeting with Director Mayorkas of USCIS, we reviewed
    important aspects of the proposed rules for the issuance of temporary
    work permits for aliens currently in the Commonwealth. He and his staff
    have listened carefully to our concerns about a large number of
    practical aspects of the work permit program. I believe that we in the
    Commonwealth and USCIS will have both the capability, and a cooperative
    spirit, to deal with the late roll-out of the worker regulations. The
    delay in issuing these rules in final form has resulted, in part, from
    our joint staff consultations about the program, and the USCIS efforts
    to address our concerns. I am persuaded that the new program will
    better meet the needs of the CNMI and its U.S. citizens as well as the
    alien labor force.
        I have also broken the impasse with ICE about that agency's desired
    use of the Commonwealth's correctional facility. On the assumption that
    a partnership sometimes needs to start with one side giving more than
    another, I agreed to accept the ICE proposal of a relatively low per-
    diem rate for use of the facility. A few days before this agreement was
    to take effect, the Commonwealth learned of a 60% reduction in the
    level of ICE detainees to be authorized. Not only would this have a
    significant, negative fiscal impact on the CNMI, it would also mean
    lowered capacity to review and remove illegals from the Commonwealth.
    Nonetheless, we went forward to implement the agreement.
        However, the overall situation remains extraordinarily harmful to
    the Commonwealth. It is time for the Subcommittee to consider the
    overall implementation of PL 110-229 and its impact on the 30,000
    United States citizens living in the Commonwealth. Based on what we
    have experienced over the past three years, this law is being
    implemented to reshape--and substantially hurt--the Commonwealth's
    economy and community. In particular, the implementation of this
    unnecessarily complicated law operates to reduce the political
    authority of the Commonwealth's local government in ways that would not
    be tolerated in the counties and States on the Mainland. By doing so,
    it harms the indigenous elements in the CNMI population--namely, the
    Chamorro and Carolinian people--who gave up their land and sovereignty
    in return for U.S. citizenship and the opportunity to enjoy the
    political freedoms and economic opportunities available to all U.S.
    citizens.
        We have no objection to federal control of immigration if it is
    done efficiently and effectively as Congress intended. What has
    happened instead is that Title VII of PL 110-229 has brought to the
    Commonwealth all of the very serious immigration problems that exist on
    the Mainland. We have many illegal aliens who are not being deported--
    although one of the clearly stated goals of the federalization law was
    to reduce alien workers who could not obtain a standard federal visa to
    zero within a few years. Some of these illegal aliens are employed
    illegally and take jobs away from U.S. citizens. Others are unemployed
    and survive on government benefits that provide an incentive not to
    leave the Commonwealth. Particularly since federal authority came into
    effect, the Commonwealth has had an increased inflow of tourists and
    others who entered on a temporary basis but remain illegally in the
    CNMI hoping for access to amnesty that will provide a green card. The
    burden on CNMI taxpayers related to illegal and unemployed aliens is
    heavy.
        With a population of more than 300 million people, the 50 States of
    the United States can absorb the economic and social costs of these
    immigration failures--although there appears to be a growing awareness
    across our country that serious immigration reform is necessary. But
    the Commonwealth has only 30,000 U.S. citizens, with about 16,000 of
    them being registered voters. Our small community is enormously
    burdened by these failures, which have complicated the Commonwealth's
    efforts to address its continued economic decline.
        When it enacted Title VII, Congress promised the Commonwealth a
    balance between benefits and burdens in connection with this so-called
    immigration reform. All of the burdens we warned about have certainly
    come to pass, in even worse levels than we predicted. However, we have
    received absolutely none of the benefits that the drafters of the bill
    promised.
        To be specific:
            1.  No visa waivers: The bill provides for a visa waiver
            program with respect to Russia and China, two very important
            markets for us. The visa waiver program has been blocked. We
            understand that the Department of Homeland Security has twice
            examined possible national security implications of a visa
            waiver program for the Commonwealth and Guam and has found
            none. The Department of Defense and the Department of the
            Interior have no objection. We understand that the Department
            of State has refused, on policy grounds, to implement what has
            been mandated by Congress. Our tourist industry--the principal
            economic basis for our economy--has been seriously hurt. While
            we appreciate the efforts of Secretary Napolitano to give us a
            temporary parole system, such a system simply does not allow
            for necessary continued investments in growing these markets
            due to the fact that the program can be halted without notice.
            2.  No technical assistance: The bill mandates technical
            assistance from four federal agencies--Labor, DHS, Commerce,
            and Interior. Three years later, Labor, DHS, and Commerce have
            given us nothing under PL 110-229 and have denied our very
            modest requests for grants. Interior has no funding for
            technical assistance specifically with respect to PL 110-229,
            but has allocated to the CNMI some of the technical assistance
            funds which we would otherwise receive under regular insular
            area programs.
            3.  No effective immigration enforcement: The bill promises
            effective immigration enforcement. We are given no official
            statistics by ICE, but immigration lawyers report that ICE has
            deported fewer than 100 aliens in three years. At that rate,
            ICE will not clear the books of illegal aliens in the
            Commonwealth for many decades. ICE also refuses to fund a very
            low-cost software-based effort to identify illegal aliens who
            arrived prior to 1996.
            4.  Poor performance at the border: The CBP agents who man the
            border in the CNMI are all temporary assignees. We have
            constant complaints that they are rude, arrogant, and slow in
            processing arriving tourists. Tourism is our lifeblood. An
            unwelcoming atmosphere at the border is unacceptable. In
            addition, CBP has prevented the Commonwealth from maintaining
            its exit database that compared entry data to exit data and was
            very effective in identifying overstaying tourists. CBP has no
            exit database that can provide current information on
            overstayers. As a result, it appears that we have an increasing
            number of aliens in overstayer status and no way to identify
            them. CBP refuses to acknowledge its responsibility for these
            problems and has insisted on applying the same ineffective
            program in the Commonwealth that it does in the Mainland,
            although a more effective CNMI program has demonstrated its
            utility and is available.
            5.  No funding to substitute for coverover: The bill takes away
            a major funding source, the coverover to the Commonwealth from
            immigration and naturalization fees paid to the United States,
            which is available to other territories. We are given only a
            very small fee from work permits--about one quarter to one-
            eighth of our prior funding--in return when the regulations are
            finally issued. To date, we have received no funding from this
            source.
            6.  No consultation: The bill provides that we will be
            consulted before reports are submitted to Congress. That has
            not happened. Executive Branch reports are submitted before we
            have ever had a chance to even see a draft. I should note that
            the GAO routinely allows us to review a draft, but this is not
            the case with the Department of the Interior or the Department
            of State.
        I could go on at great length about how the burdens have multiplied
    and the benefits have never materialized. However, it has been my
    experience that these oversight hearings with a piecemeal approach are
    not a forum in which meaningful change can occur. This Committee cannot
    get ICE to deport more than a relatively few illegal aliens each year
    or get CBP to stop being rude to visitors who enter the Commonwealth,
    or get Labor or Commerce to provide the technical assistance we were
    promised, or get additional funds for Interior. We are working hard on
    these problems within the Executive Branch, but the Commonwealth is
    very small and our problems are easy for federal bureaucrats to ignore.
    Only if this Subcommittee is willing to underwrite a serious, system-
    wide reform of the implementation of PL 110-229, and amendment of its
    provisions that do not work, will the Commonwealth see any progress.

                              ********************

        Now I would like to address H.R. 1466. I oppose this bill and urge
    that it not be acted on by this Subcommittee.
        Many of the difficulties encountered in the implementation of Title
    VII result from the fact that it was drafted by persons without any
    expertise in immigration law or understanding of the Commonwealth's
    economy. It is our view that H.R. 1466, and other bills dealing with
    immigration in the insular areas, should be handled by the appropriate
    subcommittee of the House Judiciary Committee. I know that other bills
    are being considered there that may have some potential applicability
    to the Commonwealth, especially federal laws that endorse the authority
    of the States to deal with the employment of illegal aliens by
    employers. For example, I am impressed by the bill introduced by
    Representative Lamar Smith with respect to a national program to deter
    the employment of illegal aliens.\1\
    ---------------------------------------------------------------------------
        \1\ Six States have now passed legislation to deal with some
    aspects of this problem. Most recently, Louisiana on July 7, 2011,
    enacted two laws dealing with the usage of the federal E-Verify
    Program. One law requires all state and local contractors to use E-
    Verify; and the other requires private businesses to verify the legal
    status of their new hires by providing employers that use it a safe
    harbor against sanctions.
    ---------------------------------------------------------------------------
        I believe that Congressman Sablan proposed this bill without the
    demographic information necessary to assess its impact on the
    Commonwealth. That is not his fault. The U.S. Labor Department and the
    U.S. Department of Commerce do not provide the Commonwealth with the
    full range of data services routinely available to States and counties
    in the Mainland. We have recently been told that we will not even have
    the preliminary results of the 2010 census until 2012.\2\
    ---------------------------------------------------------------------------
        \2\ Some of the information currently being provided by the U.S.
    Census Bureau with respect to the CNMI appears to be projections based
    on unidentified assumptions. For example, its listing for the Northern
    Mariana Islands contained in its International Programs Division shows
    a population of 48,000 for mid-year 2010, 46,000 for mid-year 2011, and
    45,000 for mid-year 2012. If these figures are correct, then there are
    fewer U.S. citizens in the CNMI currently than reflected in the text.
    ---------------------------------------------------------------------------
        I did not see a draft of H.R. 1466 before it was introduced, and I
    understand that experts on alien labor in the Commonwealth also were
    not consulted. After H.R. 1466 was introduced, I requested a detailed
    analysis of its likely social and economic impact. We understand that
    the numbers involved in H.R. 1466 will strike some Members of Congress
    as very small, compared to the U.S. immigration numbers. Some may
    assume the effect would also be minor. That is wrong. We have only
    30,000 U.S. citizens living in the islands that make up the
    Commonwealth and about 16,000 registered voters who are predominantly
    of Carolinian and Chamorro ancestry. We are like a very small county in
    one of the 50 States.
        We now estimate that there were approximately 23,000 aliens
    (including illegals) residing in the Commonwealth at the end of 2008.
    Unlike our U.S. citizen population, most of these aliens are adults.
    Most of these aliens, but perhaps not all, were present in the CNMI on
    May 8, 2008, the date of enactment of the federalization law, and
    therefore would meet one of the requirements of H.R. 1466 to gain the
    bill's preferred status for parents of U.S. citizen children. Because
    of CBP's failure to maintain an exit database that can rapidly identify
    overstayers, we do not know how many of these aliens are still in the
    Commonwealth. We believe that nearly all are still present. At present,
    more than half of them are unemployed, due to the serious economic
    recession that has caused a 45% decrease in the Commonwealth's GDP over
    the past several years.\3\ A recent GAO report estimates that
    employment in the CNMI has dropped an unprecedented 35% from 2006 to
    2009.\4\
    ---------------------------------------------------------------------------
        \3\ Our estimate of the unemployed includes those who may be
    employed illegally and therefore do not show up in our jobs surveys.
        \4\ American Samoa and Commonwealth of the Northern Mariana
    Islands: Employment, Earnings, and Status of Key Industries Since
    Minimum Wage Increases Began, GAO-11-427, June 2011, Government
    Accountability Office.
    ---------------------------------------------------------------------------
        The Commonwealth began admitting alien workers in numbers in 1985
    as the garment and tourism industries began to grow simultaneously.
    Many of these workers were from the Philippines and China, most were
    female, and most were relatively young. Many gave birth in the
    Commonwealth, and these children were U.S. citizens by virtue of the
    Commonwealth's status as a territory of the United States. As the
    federal presence in the Commonwealth grew during the 1990's, some
    federal officials repeatedly suggested that the alien parents of U.S.
    citizen children were entitled to special status--although that
    certainly is not the case under U.S. immigration law. Not surprisingly,
    the births of children to aliens increased.
        When the Commonwealth controlled its own immigration, we admitted
    alien workers on a temporary basis while they remained employed, and
    unemployed aliens were repatriated. When the garment manufacturers
    closed down because of changes in WTO rules, the Commonwealth
    repatriated over 16,000 alien workers beginning in 2005. After the
    federalization law was enacted in 2008, some federal officials promised
    a path to US citizenship for aliens who had U.S. citizen children or
    who had lived in the Commonwealth for several years. This gave aliens a
    strong incentive to stay in the CNMI rather than return home.
        Beginning in 2006, U.S. citizen children of aliens reached age 21
    in increasing numbers and began petitioning for green card status for
    their alien parents. This occurred under the normal U.S. immigration
    processes, which are available to all qualified aliens--and which we
    think should apply to the Commonwealth in the same way as in the
    States. There is no need for a special citizenship provision applied
    only to the Commonwealth. When the Judiciary Committee considers
    immigration reform for the U.S., the Commonwealth will be a part of
    that reform. We do not want or need an amnesty bill now.
        H.R. 1466 creates four categories of new U.S. citizens. I want to
    focus on the fourth category which covers alien parents of minor U.S.
    citizen children.\5\ This category is, by Commonwealth standards, very
    large.
    ---------------------------------------------------------------------------
        \5\ The first category consists of aliens who were born in the
    Commonwealth between 1974 and 1978 and who did not get U.S. citizenship
    under a prior court decree covering this group. We estimate there are
    about 200 persons in this group.
        The second category consists of aliens who were granted permanent
    resident status by the CNMI government prior to 1981. We estimate there
    are 82 persons in this group.
        The third category consists of aliens who are the spouses and
    children of people in groups 1 and 2. We know of only 102 persons in
    this group, but there may be a few more.
    ---------------------------------------------------------------------------
        Here's what will happen under H.R. 1466:
             1.  Large scale amnesty for aliens: H.R. 1466 is essentially a
            large-scale amnesty bill. It provides a direct route to
            citizenship that would create an estimated 11,000 new U.S.
            citizens in the Commonwealth within the next 10 years--
            virtually all of whom are adults and would be voters.\6\ This
            would occur at a time when the current U.S. citizen population
            of Chamorro and Carolinian ancestry is estimated to decline.
            Our severe economic recession has caused some ofthese citizens
            to move to the Mainland just to earn enough to support their
            families. The social disruption from arbitrarily creating
            citizens in this large proportion cannot be overstated. I do
            not believe that turning this large population of alien
            temporary workers into citizen voters would be tolerated in any
            county or State in the United States.
    ---------------------------------------------------------------------------
        \6\ Our estimates in this regard are based on data with respect to
    live births and fertility rates, public and private school enrollments,
    ages and genders of aliens in the Commonwealth, umbrella permits,
    utilization of nutritional assistance programs, U.S. census estimates
    and projections, U.S. immigration laws and regulations, and other
    related data. LIDS data are not relevant for these purposes as those
    data record work assignments. Because the federal authorities do not
    collect data in the Commonwealth that is readily available for all
    states and most counties, we must rely on estimates. We anticipate that
    these estimates are on the low side.
    ---------------------------------------------------------------------------
             2.  Permanent CNMI-only residence: Under H.R. 1466, these
            aliens are granted permanent residence in the Commonwealth for
            all time. They are protected from deportation until their minor
            child reaches age 21 and can petition for a grant of a green
            card for the parent leading to U.S. citizenship. That is a
            significant distortion of the U.S. immigration system. Allowing
            these aliens to remain in the Commonwealth--even if they do not
            petition for adjustment of status to be able to enter the
            Mainland U.S.--is a long-term burden on the Commonwealth that
            occurs nowhere else in the U.S.
             3.  Non-custodial parents included: A parent who provided no
            support whatsoever to the minor U.S. citizen child or never
            lived in a household with the minor child is qualified to
            remain in the Commonwealth. H.R. 1466 only requires a parent's
            name on a birth certificate--not any evidence of a meaningful
            parental relationship.
             4.  Unemployed and unemployable parents included: A parent who
            is unemployed will qualify to remain in the Commonwealth
            forever. The CNMI will have to foot the bill for supporting
            them because, under H.R. 1466, they are not allowed to travel
            to the U.S. The direct and indirect costs to the CNMI
            government each year for unemployed aliens remaining in the
            Commonwealth is high and a particular burden on CNMI taxpayers.
             5.  Parents with no means of support included: A parent who
            has no means of support whatsoever will qualify. The bill
            attempts to get rid of the requirement for U.S. green cards of
            a sponsor willing and able to undertake the responsibility to
            pay support in the amount of at least $18,000 a year (at
            present levels) should the alien not be able to support himself
            or herself.\7\ This means that aliens with no visible means of
            support would qualify to remain in the Commonwealth or to
            become U.S. citizens. This is not allowed anywhere else in the
            U.S.
    ---------------------------------------------------------------------------
        \7\ See section D(iii)(II).
    ---------------------------------------------------------------------------
             6.  Parents with a history of illegal employment included: A
            parent who works illegally in the underground economy, and
            harms the Commonwealth in the process, is eligible. This kind
            of broad amnesty encourages illegal employment as there is no
            deportation penalty. It also undermines employment
            opportunities for U.S. citizens. Although H.R. 1466 does not
            address the issue, it appears that this new status would also
            be available to persons who entered the CNMI before or after
            November 28, 2009, and became an illegal overstayer in
            violation of the INA, notwithstanding the general rule that
            illegal entrants and immigration violators are not allowed to
            be admitted into the United States.
             7.  Parents who have left the Commonwealth included: A parent
            who left the Commonwealth after November 2009 and has not
            returned to the Commonwealth will qualify if he or she returns
            by the date of enactment of H.R. 1466. The promise of U.S.
            citizenship is likely to attract a substantial number of re-
            entrants. This will aggravate the Commonwealth's current
            problem with unemployed aliens.
             8.  Parents of children raised elsewhere included: A child who
            was born in the Commonwealth but was sent by his or her parent
            to live in China or the Philippines--and who remains with
            relatives in the Philippines or China for his or her entire
            childhood to age 21--can still protect his or her parents,
            enabling them to remain in the Commonwealth more or less
            permanently for the prospect of better employment or welfare
            benefits.
             9.  APA protections stripped away: H.R. 1466 strips away the
            protections of the federal Administrative Procedures Act by
            permitting the Department of Homeland Security to promulgate
            implementing regulations without the customary requirement of
            issuing them in proposed form and providing for a period within
            which the affected parties may comment. Are we incapable of
            learning from experience? We had to go to federal court in
            November 2009 to order to require DHS to comply with the
            provisions of the APA with respect to its proposed transitional
            worker permits. I see no reason for including this exception in
            this law.
            10.  A definition of ``immediate relative'' rejected by the
            Commonwealth legislature determines the eligible class: The
            bill refers to a definition of ``immediate relative'' that was
            in the Commonwealth Code prior to May 2008.\8\ That definition
            was struck from the Commonwealth Code by our Legislature. We
            have found that, under well-accepted drafting rules, cross
            references to definitions in other legislation may be
            appropriate in very limited cases.\9\ This is not one of those
            cases. A cross-reference to legislation that was repealed prior
            to the time of the legislation containing the cross-reference
            is particularly unacceptable. Among other flaws, it masks the
            true intent of the bill to those who are not lawyers or skilled
            legislative researchers.
    ---------------------------------------------------------------------------
        \8\ This is the reference to Title 3, Section 4303, which was
    deleted from the Commonwealth Code by P.L. 17-1. It no longer exists.
        \9\ See, for example, the following: Office of the Legislative
    Counsel, U.S. Senate, Legislative Drafting Manual (1997); Lawrence E.
    Filson, The Legislative Drafter's Desk Reference (Congressional
    Quarterly, Inc., 1992); Donald Hirsch, Drafting Federal Law, 2d Edition
    (U.S. Government Printing Office, 1989).
    ---------------------------------------------------------------------------
            11.  Prior problems of adoption fraud are revived: The old now-
            repealed definition of ``immediate relative'' refers to adopted
            children who are adopted prior to age 21. This led to
            significant problems with adoption fraud in the Commonwealth--
            children who were adopted for the purpose of conveying status
            for immigration purposes. H.R. 1466 allows an alien parent who
            has more than one U.S. citizen child the leeway to consent to
            an adoption of one of the children for the purposes of
            eligibility under H.R. 1466. If this happened to any
            significant extent, as it has before, this would increase the
            number of eligible parents.
        Let me be clear. It is the U.S. citizens in the Commonwealth who
    gave up their land and their sovereignty to become a part of the United
    States. The U.S. citizens in the Commonwealth have a right not to have
    their community and culture be so radically changed in this fashion--
    unless they decide to do so through their own democratic institutions.
        We treated guest workers well over the years, and we continue to do
    so. Some critics have cited poor working conditions. We corrected those
    long ago. Some cited an estimated $6.1 million in back pay owed to
    guest workers over the 25 years since 1985. That estimate was wrong.
    The total turned out, after investigation, to be far lower. All claims
    of back pay have been adjudicated; and only a relative few cases remain
    in our courts. Other critics have pointed to alleged human trafficking
    violations. Human trafficking is a federal crime and the only fair
    measure is convictions in federal cases--not allegations or rumors.
    Federal convictions over the past 10 years have been very, very few.
    Our record over the years is the equal to, and we think better than,
    anywhere aliens are employed in large numbers in the United States. And
    we understand why aliens in the Commonwealth want to stay. They have
    freedoms, are treated well, and have employment opportunities and
    social benefits.
        I have a proposal for an H-5 visa within the regular U.S.
    immigration system, and the CNMI Senate has a proposal for a non-
    citizenship status somewhat akin to the status of Freely Associated
    State residents in the Commonwealth. Both of these proposals are in the
    supplementary materials to be provided to the Committee. Both of these
    proposals are far better alternatives for the people of the
    Commonwealth than H.R. 1466.
                                     ______

    Response to questions submitted for the record by The Honorable Benigno
      Repeki Fitial, Governor of the Commonwealth of the Northern Mariana
                                    Islands

    From The Honorable Madeleine Z. Bordallo
    Q: Could you tell the Committee, have there been any significant issues
            with regard to overstays? The Parole Authority is probationary
            period to see if this program will work. I am not aware of any
            overstays or law enforcement concerns. In my opinion this
            program works. What is your opinion of the parole authority and
            any enforcement issues?
        A: ``I have testified previously that the Commonwealth looks
    forward to the inclusion of China and Russia in the formal visa waiver
    program envisioned by Public Law 110-229. Such inclusion would provide
    an increased measure of certainty and stability that would enable the
    Commonwealth to develop these markets more effectively. We are very
    appreciative of the Secretary's decision to use her parole authority to
    permit tourists from China and Russia to enter the Commonwealth and
    believe that the program has been administered efficiently and smoothly
    by Customs and Border Protection personnel. Based on figures provided
    by CBP last month, we are pleased that a very small number of visitors
    (36) were rejected upon arrival in the Commonwealth compared with the
    20,947 visitors who were paroled in as tourists. The Commonwealth has
    received no reports from CBP or any other Department of Homeland
    Security component regarding ``overstayers'' from China and Russia who
    did not comply with the terms of their permission to enter the CNMI.
    None of the participants in dealing with these tourists--the Marianas
    Visitor Authority, the charter carriers, and the hotels--reports any
    such ``overstayer'' problem and all emphasize the importance of these
    markets to the visitor industry and the Commonwealth economy.''
                                     ______

        Mr. Fleming. Thank you, Governor, and we have now Governor
    Calvo. Sir, you have five minutes.

                STATEMENT OF THE HON. EDDIE BAZA CALVO,
                     GOVERNOR OF THE ISLAND OF GUAM

        Governor Calvo. Thank you very much, Mr. Chairman and
    Members of the Subcommittee. My name is Eddie Baza Calvo,
    Governor of Guam. I am here to testify on Public Law 110-229,
    the Guam/CNMI visa waiver program.
        Unlike previous testimonies that you may have heard in the
    past, I am not here to ask you for subsidies. We are here to
    ask you for an opportunity. Release some Federal regulations
    that make no sense for Guam and American, and we can make it on
    our own. As our economy takes a new life, I do believe that
    Guam can be a shining example of economic, American economic
    strength in Asia.
        I am a new Governor with a new doctrine on Federal
    relations. Guam has some major financial problems caused by
    many Federal mandates, but nevertheless my administration is
    looking internally and implementing solutions to fix our fiscal
    problems. I don't want our government to rely so heavily on
    Federal subsidies, and I am sure that is welcome news to
    Members of the Congress.
        Guam has a government deficit equal to 51 percent of our
    revenues, and like other states and territories, we are cutting
    spending and raising revenues to fix this staggering situation.
    But unlike other U.S. communities, Guam's deficit is a direct
    result of Federal mandates and the Federal Government's
    inability to live up to its own obligations and its mandates.
        The financial burdens of the compacts that the United
    States signed with the Freely Associate States of Micronesia is
    nearly at $1 billion for the people of Guam. The provision of
    funding for unimpeded immigration rights to Guam have caused a
    natural population influx, and citizens from these areas are
    using up to 70 percent of some of our public services. For over
    26 years immigrants have been migrating and maxing out our
    capacity to provide services, and without adequate funding to
    offset the impact from the Federal Government our services and
    infrastructure has fallen into disrepair, leading to violations
    of other Federal mandates. This includes the Federal EITC. We
    now have to pay for the larger population which does not get
    reimbursed like the states, and as a result the Federal
    Government has taken us to court to pay for services we would
    have been able to afford if we had not breached our capacity.
        Now, this is clearly an injustice, but we are dealing with
    a financial dilemma with local solutions and local economic
    initiatives underway. Unfortunately, we have hit a regulatory
    wall. Tourism, our number one industry, is stagnated. Our
    primary market, Japan, is no longer the largest potential
    source of outbound tourists.
        Distinguished ladies and gentlemen, there is a great irony
    between the financial malaise that beset the Guam government
    and the economic development we have not been allowed to
    pursue. The Federal Government has seemed sometimes cavalier
    and almost uninterested at the burden that is placed on our
    resources, and we have come to Congress to plead our case and
    get the reimbursements that rightly should be paid, but
    Congress has refused.
        Yet the Federal Government has been sitting on a regulation
    that would have begun solving our financial dilemma and our
    economic troubles. Congress mandated a unified immigration
    policy for Guam and the CNMI, but the Department of Homeland
    Security has been contravening your intent. There is no parole
    authority for Chinese and Russian tourists to enter Guam
    despite Congress's determination that such authority would be
    of significant economic benefit and would not unduly compromise
    national or homeland security. Even one percent market share of
    China's $55 million outbound tourists and Russia's 13 million
    would translate into GDP growth in the billions of dollars for
    Guam, and for our part would mean thousands of jobs to close
    the 13.3 percent unemployment gap we currently have, and more
    revenues to provide services for our residents and local FAS
    residents. Put simply, if you give us this opportunity we can
    take care of our problems.
        But there is a larger reason the United States should grant
    this authority for Guam, and it cuts into the heart of the
    initiative that can help reclaim American economic political
    strength in the Asia Pacific Rim. Part of the United States
    national export initiative is to reduce the huge trade deficit
    with China. Well, Guam could help facilitate that. The millions
    of Chinese outbound visitors are exporting Chinese capital, yet
    the easiest markets accepting them are not U.S. markets. Other
    Chinese cities and Asian destinations are fast depleting the
    opportunities for the United States.
        Allowing the visa waiver program for Guam will bring
    millions and billions in Chinese currency into the United
    States, and this program can be a part of the winning strategy
    of the national export initiative.
        The old way of thinking of our island as an isolated
    military outpost is outdated. We are America in Asia. We are a
    gateway to the Orient, Asia's bridge to the United States. I
    came today with a message, a very different one. We have
    financial problems like other states, but we are dealing with
    those problems. Even the cost of impact of migration has caused
    Federal compacts is a cost that we are bearing but my message
    deals less with financial assistance for Guam, but it deals
    more about our desire for economic self-sufficiency. We can do
    a lot for America if you give us that opportunity.
        Now, some have said the American century is a bit dim, but
    I can see a light in that part of the world on my porch that
    faces the Pacific Ocean where the Star Spangled Banner and the
    Guam flag fly high at the Government House. But ladies and
    gentleman, Members of this Committee, we need your assistance,
    we need your help. We can be that beacon of the American dream
    in the Western Pacific, and I ask for your assistance in,
    again, granting this authority to Guam. Thank you and God
    bless.
        [The prepared statement of Governor Calvo follows:]

    Statement of The Honorable Eddie Baza Calvo, Governor, Island of Guam,
              on H.R. 1466, The Consolidated Natural Resources Act

        Thank you, Mr. Chairman, for inviting me to testify. For the
    record, I am Eddie Baza Calvo. I am the Governor of Guam. This is my
    written testimony on the implementation of Public Law 110-229,
    regarding the Guam/CNMI Visa Waiver program. I beg your indulgence as I
    explain the thinking of Guam's new administration below.
        As the new governor of Guam, in my first opportunity to testify
    before Congress, I want to be certain that the Members of the House are
    aware of the reasons it is critical for the Guam-CNMI Visa Waiver
    Program be implemented and that Chinese and Russian nationals be
    allowed to travel to Guam and the CNMI, as originally intended by
    Congress.
        I have a simple and unique message for Congress today. Unlike
    previous testimonies you may have heard in years past, I am not here to
    ask for subsidies. Guam is going through a unique transformation that,
    if done correctly, will result in unprecedented economic self-
    sufficiency in the long term.
        Today we are far from that self-sufficiency. This fiscal year Guam
    will receive $369 million in federal grants and matching grants. These
    grants fund several federal and local programs, including our
    university land grants, the National Guard, public assistance, housing
    for the less fortunate, education programs, etc. These are the same
    grants the other States and territories seek and for which they
    compete. It costs the federal government far less to fund these
    programs in Guam because of our small population. For many of these
    programs, Guam does not receive the same relative share that other
    American communities do.
        As a new governor, I hesitate to have the government of Guam rely
    so heavily on these grants to sustain local operations. We are taking
    steps to fix our financial house over the long term, but unfortunately,
    this funding has become critical to services. These grants have become
    increasingly important to Guam over the past 20 years. The year 1991 is
    an important year in Guam memory. That was the last time the government
    of Guam was able to pay tax refunds on time. We currently owe
    approximately $280 million in tax refunds, going as far back as
    Calendar Year 2005. There are several reasons why this has occurred,
    including natural disasters such as super typhoons, which have wrecked
    havoc on our island, and global events beyond our control, such as
    SARS, H1N1, and two Gulf wars, which have wrecked havoc on our main
    economic industry, Asian-based tourism. While our people are resilient
    and have rebounded and rebuilt, our government finances were not as
    resilient. In addition, federal court orders in the hundreds of
    millions have placed a great burden on the backs of our taxpayers. This
    government had to borrow to finance some of these orders. The annual
    debt service on the bonds to pay these court orders has significantly
    eroded our revenue base. The Earned Income Tax Credit, which we are
    obligated to pay under the mirror IRC tax code system we have, and
    which the federal government reimburses to the state governments, is
    not reimbursed to Guam. This is a drain on our General Fund of between
    $32 to $36 million annually.
        Because of declining revenues, the result of Japan's financial
    downturn, the decline in military spending, and federal court-mandated
    new programs, imposed fines and application of EITC, the money that
    should be set aside for tax refunds continues to be used to pay for
    essential government services. All this, along with the growth of
    freely associated states of the Micronesia (FAS) migration in ever-
    increasing numbers, has created a structural imbalance in our General
    Fund. And while our community has been growing, along with a greater
    demand for public services, collections have not kept pace with this
    growth. The cumulative deficit that has grown over the years now is
    $336 million, according to our FY 2010 audit report.
        Distinguished Ladies and Gentlemen, our deficit is 51 percent of
    our current year's adopted revenues. It is unmanageable. It rides as a
    burden on the backs of taxpayers awaiting their refunds. I'm not here
    to ask you to solve our problems for us. We are working to do that on
    our own. I directed my Cabinet to begin personnel evaluations for
    performance and I have instituted a 10 percent cut in spending. An
    island-wide reassessment of property values currently is underway to
    increase revenues. Revenue agents also are going after non-filers and
    non-payers. I am not asking for a federal bailout. What I am asking is
    for the federal government to make good on its own mandates, with the
    same fervor and sense of urgency as it has imposed upon our government.
        The year 1991 is the sixth year following the U.S. government's
    compact, or treaty, with the freely associated states of Micronesia. In
    1985, these new countries entered into an agreement with the U.S. The
    U.S. government said the people of these former U.S. administered
    territories could migrate freely into the United States. Noting the
    dismal conditions of these countries' economies and education systems,
    the U.S. promised federal aid to them. Rightly so, our country wanted
    to leave a legacy of progress in former territories it liberated and
    held in trust. The U.S. government agreed to absorb and pay for the
    impact of their migration to the States and territories of the U.S.
        It's been 26 years since then. The promise the U.S. made to the
    citizens of the FAS has resulted in meager improvements to their
    economies and school systems. As a result, the bulk of the FAS
    citizens, tens of thousands of them, have migrated to the closest U.S.
    port of entry: Guam. Our island absorbs well over half the migratory
    impact of the treaty the U.S. government entered with the FAS.
    Resultingly, Guam's unemployment rate now is 13.3 percent. The true
    financial impact of this migration has cost the government of Guam
    nearly $1 billion since the Compacts were signed. Yet, Guam has only
    received $xxx since the Compacts. To put this in perspective, our
    General Fund generates about a half a billion dollars annually. Guam
    has found itself the casualty of another unfunded federal mandate.
        I understand, however, that the U.S. government is itself in a bad
    economic state and will probably never fully reimburse Guam for the
    impacts of the Compacts. But I want to put into perspective how this
    federal mandate has contributed to, and may even be said to have
    caused, our deficit and the structural imbalance of the General Fund.
    We have been able to quantify most of what it costs to pay for
    government services directly used by citizens of the FAS annually. The
    figure is $113 million a year, for which we have never been reimbursed
    more than $14.5 million. That is about $100 million, or one-fifth of
    our local budget going to provide unreimbursed social services to FAS
    migrants. The rate of usage in each service category is alarming. I
    attached a breakdown, but here are some highlights:
    [GRAPHIC] [TIFF OMITTED] 67403.001

        .epsThree years worth of this impact outpaces the size of our
    General Fund deficit. If you consider the direct costs the government
    of Guam incurs because of this federal mandate, you can see that the
    appropriations needed to meet the demand for services will always
    outpace the revenues we collect. This federal mandate, Distinguished
    Ladies and Gentlemen, is driving up the cost of government services in
    Guam; costing us approximately $100 million annually.
        We are told that we need to understand the federal government's
    financial situation. We are told we must take into consideration the
    federal bureaucracy's hardships and ability to pay. That is reasonable.
    What is most unreasonable is the hardship unfunded federal mandates,
    such as the FAS Compacts and EITC, place on our island people, forcing
    us to withhold tax refunds as our government continues to use their
    monies to subsidize the cost of providing government services to our
    residents as a result of the Compacts. Adding insult to injury, while
    the federal government sees no need to reimburse us beyond its ability,
    some would say its willingness, to pay us, it imposes on us additional
    mandates, orders, receiverships and fees without any regard for our
    ability to pay and sustain services for our residents. Here is a list
    of these orders and fines:
    [GRAPHIC] [TIFF OMITTED] 67403.002

        .epsThe government of Guam has repeatedly asked the federal court
    and the federal agencies pursuing these fines and orders to consider
    the progress we were making in meeting the demands of the federal
    mandates. We have repeatedly asked for consideration on the rigid
    timelines imposed to provide the local cash to fund our compliance
    initiatives. We were told such considerations were not possible. It is
    a tragic irony that the federal government can withhold from us just
    reimbursement for its federal mandates because of its cash situation,
    despite the overwhelming impact of its failure to meet its own
    mandates, yet give us no consideration of the effect that its failure
    to reimburse us has on our ability to pay its other mandates.
        On top of this, the U.S. Environmental Protection Agency now wants
    the government of Guam to install secondary wastewater treatment
    facilities at the cost of $400 million. The U.S. EPA does not care how
    this will impact our people; nor has it considered other less expensive
    and environmentally sensitive technological solutions for wastewater
    treatment.
        How is it right that we are made to pay for more than three-
    quarters of a billion dollars in federal mandates when the federal
    government still owes us a billion dollars in reimbursements for its
    obligation to us?
        The federal government is strangling us with mandates it expects
    our cash-strapped government to meet upon unreasonable timelines and
    demands. There has been no consideration for our ability to sustain our
    financial house while meeting these orders and paying for what is
    supposed to be the federal government's bill. These extraordinary
    demands not only drain our financial resources, they rob us of the
    attention and focus we need to pay to our own local programs and
    initiatives to combat poverty and increase wealth among Guamanians.
    Make no mistake about it; we are good American citizens who are doing
    our part to deal with these problems ourselves. We have a full throttle
    economic and financial agenda. The only thing getting in our way is the
    federal government's burdensome bureaucracy, mandates, rules and
    regulations.
        Despite these challenges, we are moving forward with viable
    economic initiatives to improve the quality of life for Guamanians and
    increase our presence in the Asia Pacific Rim.
        My administration is developing a long-term economic strategic
    plan, which leverages the military buildup investment with our
    strategic location between Asia and the mainland United States. I am
    bringing the community together to use available information and
    academic methodologies and best practices to forecast Guam's economy
    and its community of the future. We will project our needs, identify
    budding industries, shore up our workforce goals and create a community
    model supported by the infrastructure, workforce and regulatory
    environment fit to meet these projections. We will align curriculum in
    our schools, colleges and university to meet these goals, creating
    certainty in our future in much the same way several Asian nations went
    from lands of scarce natural resources to the economic tigers they are
    today.
        As this planning and implementation process occurs, we have already
    launched an affordable housing initiative to spark construction and
    generate interest in mortgages for first-time homeowners. Our goal is
    to build 3,000 affordable homes over the next five years. We launched
    the initiative two weeks ago. Already, 188 homes are slated for
    development in the near future.
        The much-anticipated and recently much-debated military buildup is
    causing increased interest in the island. Our economic development
    agency, along with our Chamber of Commerce, has been organizing trade
    missions to Guam from Taiwan, Korea, China, the Philippines and Japan.
    We want Asian capital to flow into our economy. I will be leading trade
    missions to these countries later this year to court investors
    personally.
        The University of Guam is aggressively networking to build research
    and development parks as incubators of new business and new industry.
    More so than ever before, the University is taking a commanding role in
    community development. It has become a regional leader in economic
    initiatives. More importantly, it has begun a long-overdue dialogue on
    sustainability in the islands. One of the initiatives this is leading
    to is the creation of the University of Guam School of Engineering.
    These initiatives will lead to solutions to which both Micronesia and
    the U.S. government have long aspired.
        Stagnation and an increasingly competitive field of nearby emerging
    destinations have impacted tourism, our number one industry. The
    Japanese disasters of March 2011 have also had their most recent effect
    on our Asian-based tourism industry. We are adapting and coping as best
    we can, but there is only so much we can do.
        My message is this: We can make it on our own if the federal
    government makes good on its own mandates, and releases us from
    restrictions that do not make sense for our very unique economy and for
    the United States. We believe this is an especially appropriate message
    to send to you as Congress and President Obama try desperately to curb
    federal spending and reduce the federal deficit. But that's just one
    narrow way of seeing things.
        Guam and the CNMI are geopolitically positioned in a way no other
    U.S. community is. Our location, tied with our reputation in Asia and
    the Pacific of being the strongest, closest, most stable and hospitable
    American community in that part of the world presents the United States
    with an opportunity to increase American clout militarily, economically
    and diplomatically with the fastest growing economies in the world. Put
    simply, we are in a political and geographic position to make our
    country shine. Not only are we proud to be in this position, we are
    excited to take a lead role. This is, after all, in the spirit of the
    bipartisan call from Congress for American communities to exhibit
    leadership in gaining financial independence and economic development.
        I offer to you solutions to make this happen:
    Release Travel Visa Restrictions on Chinese and Russian Outbound
            Visitors to Guam and the CNMI Only
        The United States currently does not have a visa waiver program
    with China and Russia. Two of the main reasons for this are concerns
    for national security and of Chinese and Russian nationals violating
    their visa conditions and overstaying in the U.S. These issues are of
    obvious significant concern for the U.S. I reiterate, though, what
    Congress already understood when it passed the Consolidated Natural
    Resources Act of 2008.
        Guam is not part of the contiguous United States. We have 212
    square miles of land surrounded by the deep blue Pacific. It is not
    difficult to find people in our island, but it is hard to get past
    customs and immigration officers at our airport. Even Congress supports
    this in its own findings. When Congress established the Guam VWP in
    1987 as an amendment to the Immigration and Nationality Act (INA),
    Congress emphasized the inherent protections afforded the United
    States' welfare, safety and security by Guam's geographical isolation.
    Congress determined that:
            The unique conditions prevailing on Guam and its isolated
            location provide sufficient safeguards for the welfare, safety
            and security of the United States to justify a broad
            application of the visa waiver system. Guam's isolation as an
            island in the Pacific Ocean easily allows for the restriction
            of visa waiver recipients to the Territory thereby preventing
            them from traveling onward to Hawaii and the mainland. Guam's
            small area and its relatively small population ensure that any
            non-immigrants who overstay the visa waiver period...can be
            quickly located and removed....Given the inherent protections
            which Guam offers the welfare, safety and security of the
            United States the visa waiver system should be liberally
            applied to a broad range of countries....It is intended that
            the visa waiver program should initially be given wide
            application. If threats to the welfare, safety or security of
            the United States develop those threats should be dealt with on
            a country by country basis.\1\
    ---------------------------------------------------------------------------
        \1\ 132 Cong. Rec. S4844 (Apr. 24, 1986); see also 132 Cong.
    Rec.H5274 (Aug. 1, 1986).
    ---------------------------------------------------------------------------
        Although China and Russia are currently excluded from the Guam-CNMI
    Visa Waiver Program, because of our remote location allowing Chinese
    and Russian outbound tourists to vacation in Guam and the CNMI should
    not cause such alarm to our national and homeland security agencies.
        Guam has long sought visa waiver programs with China and Russia. It
    makes sense when you consider what this can do for our island economy
    and for the investment of Chinese and Russian capital into the U.S.
    economy. Our local considerations are obvious. Guam has relied upon
    Japanese outbound tourists since the 1960s to fuel tourism, our number-
    one industry. It is this strong economic alliance we've built with the
    Japanese that built the Guam economy. That transformation from the
    rubbles of World War II bombardments and the devastation of a Category
    5 storm is nothing short of miraculous.
        Unfortunately, when the Japanese economy tanks, Guam feels it. Over
    the last decade, we've felt its stagnation. Tourists are not staying as
    long as they used to. They're not spending as much as they did before.
    On March 11, 2011, Japan was hit by a major earthquake, followed by a
    devastating tsunami and damage to a nuclear power plant. Guam is still
    feeling the economic effects of the Japan triple disaster. Tourism
    numbers from Japan have declined over 20 percent. We've been fortunate
    to increase our share of the Korean market and to attract further
    interest from Taiwan, the Philippines and Australia, but these other
    countries represent only a small portion of our tourism base. While we
    have struggled to reinvent our market and to diversify into markets
    with existing visa waiver programs, we find ourselves competing with
    several other Asian destinations that have recently emerged. They are
    all attracting the 55 million outbound Chinese and the 13 million
    Russian tourists. Guam is anxious to have its share of these markets
    and we have the infrastructure to support it. Access to Chinese and
    Russian visitors has the potential of increasing our gross domestic
    product by the billions and creating thousands of jobs. But Guam isn't
    the only body politic that stands to gain from these proposed visa
    waiver programs.
        In fact, the State Department has collaborated with the National
    Governors Association to bring provincial governors from China to the
    NGA Annual Meeting in Salt Lake City, Utah, later this month, and is
    also scheduling a state visit by U.S. governors to China for the Fall
    of 2011. President Obama in 2008 also issued a National Export
    Initiative designed at doubling U.S. exports, which recognizes tourism
    as an export component.
        Part of the United States' National Export Initiative is to reduce
    the huge trade deficit with China. Guam can help facilitate that. The
    55 million Chinese outbound visitors are exporting Chinese capital, yet
    the easiest markets accepting them are not U.S. markets. They are other
    Chinese cities and Asian destinations that are fast depleting
    opportunities for the U.S.
        Allowing China to participate in the visa waiver program for Guam
    and the CNMI, will bring billions of dollars in Chinese currency to the
    U.S. The capital will flow into U.S. banks on Guam, and then be
    invested into the imports we receive from the U.S. mainland. This
    program can be part of a winning strategy to meet the objectives of the
    National Export Initiative and begin reclaiming economic strength in
    Asia.
        We need Congress's help in affirming China and Russia's
    participation in the Guam-CNMI Visa Waiver Program.
    Provide Funding Certainty to the Defense Department for the Military
            Buildup on Guam
        A growing pillar in our economy is Defense-related activity,
    spurred by Defense spending on Guam. The pending military buildup
    caused a mini-boom of development when plans were announced a few years
    ago. Unfortunately, uncertainty and anxiety about the buildup has been
    increasing because of Defense cuts over the past year by Congress.
        To date, little has been said or released about the United States'
    funding commitment to the Global Realignment of the Armed Forces
    initiative affecting Guam and Okinawa-based forces. The Japanese
    government has made similar commitments and has deposited vast sums of
    money to the U.S. Treasury. The uncertainty is on the part of the U.S.
    government, which lately has seemed reluctant to honor the bilateral
    agreements effectuated by the State Department.
        We do recognize Congress is in a bind because the cost of the
    buildup is still unknown. However, even the Senate recognizes there is
    a buildup happening and there are costs. At this point, reducing those
    costs without any notice of how the buildup will proceed and what
    investments will be made each year sends mixed signals and causes
    confusion. There is a need for federal officials to communicate more
    effectively with Congress, the Government Accountability Office, and
    the government of Guam on buildup plans and the outlay of spending over
    the next decade.
        The anxiety on the part of our local government, our private sector
    and prospective investors has been exacerbated by recent cuts to
    Defense spending in Guam. The Senate Armed Services Committee recently
    removed an appropriation for improvements to Andersen Air Force Base,
    and a $33 million appropriation to help mitigate the impacts of a
    firing range and other buildup activities. This, while just a fraction
    of the total cost, is significant to us because it was part of a very
    much criticized negotiation that finally led to the signing of the
    Programmatic Agreement over the disposition of historic artifacts and
    other such finds during the proposed buildup.
        These so-called `signals' from Congress have triggered a standstill
    on development and business activity related to the buildup. Investors
    now are taking a `wait and see' stance with Asian capital that they
    would have already invested into the U.S. via Guam. It is critical to
    our development that Congress makes good on the United States' promises
    and provide assurances that it will fund this buildup.
    Inclusion in the Korea Free Trade Agreement and All Current and Future
            Agreements
        The sad part about Guam's enduring relationship with the United
    States is it seems the U.S. government picks and chooses when to apply
    mandates and benefits to our territory. Sometimes Guam is included as a
    U.S. territory, many other times we are treated as an international
    community not eligible for the same benefits and protections the rest
    of the country receives. This is the case with the Korea-U.S. Free
    Trade Agreement.
        The President's Office of the United States Trade Representative
    says, ``If approved, the Agreement would be the United States' most
    commercially significant free trade agreement in more than 16 years.
        ``The U.S. International Trade Commission estimates that the
    reduction of Korean tariffs and tariff-rate quotas on goods alone would
    add $10 billion to $12 billion to annual U.S. Gross Domestic Product
    and around $10 billion to annual merchandise exports to Korea.'' It
    goes on to state:
        ``In addition to strengthening our economic partnership, the KORUS
    FTA would help to solidify the two countries' long-standing
    geostrategic alliance.
        As the first U.S. FTA with a North Asian partner, the KORUS FTA
    could be a model for trade agreements for the rest of the region, and
    underscore the U.S. commitment to, and engagement in, the Asia-Pacific
    region.''
        Guam is, without a doubt, at the center of U.S. interests in this
    Asia-Pacific region. Why, then, have we been excluded from the
    agreement? We ask Congress to push for Guam's inclusion in the
    agreement.
        Guam can play a pivotal role as the United States expands its
    interests in our region. We are important for American interests in
    Asia. We are important for Asian interests in America. At the heart of
    this strategic geopolitical value are many factors all related to our
    location and our proud heritage as the westernmost frontier of the
    United States:
            1.  The major strategic importance of the military bases--
            present and future--on Guam, the ``Tip of the spear''
            2.  The airline hubs connecting Asia with Micronesia
            3.  The frontline role we have in the potential for development
            in Micronesia
            4.  The international web of fiber optic cables based beneath
            the island
            5.  The transnational shipping routes that flow through our
            oceanic backyard
            6.  The international conventions and treaties on fisheries and
            fishing that is a multi-billion dollar industry in our waters
            7.  The academic research and consortiums of marine science
            based out of our university.
            8.  The opportunity to reduce the U.S. trade deficit and bring
            billions of Asian currency to America through Guam.
        There is a clear connection between Asia and America. Guam is that
    bridge. We are the hosts to American interests in the Western Pacific.
    We set the stage for Asian entrance to U.S. markets. We can be leaders
    in an economic alliance between Asia and America. Give us the
    opportunities to make it on our own and we will help America to shine.
        The American Dream is powerful. It is no wonder we are a nation of
    immigrants. People from across the globe saw from their borders the
    bright and shining promise that is the American Dream. In America, you
    can work hard and earn a living. It doesn't matter whether your father
    is a king or your mother is a pauper, or whether you grew up poor or
    you didn't think you had the right skin color or faith. You can own a
    home. You can be your own boss. You can compete against the best, and
    you can win. This dream is attracting people to our shores in much the
    same way. While we are a small island, we represent America's heritage
    of warmth and hospitality to all those looking for freedom and
    opportunity. If you haven't been to Guam, you may be surprised when you
    get there. People from all walks of life go about their business trying
    to make ends meet and build something great for their families. It is a
    microcosm of these contiguous United States, where freedom is
    celebrated and people take advantage of opportunity.
        We are asking you for those opportunities so the American Dream can
    become a reality for your fellow Americans in Guam. In doing so, we can
    do our part in bringing the American Dream to more Americans.
        We are pursuing a Guamanian Century of Prosperity at the dawn of an
    American Millennium of Leadership and Hope. Some have said the great
    American Century is over. They say that, like Greece and Rome, the Holy
    Roman Empire and Spain, America's light above the world is destined to
    dim. I see the light of the world every morning on my porch as warm
    ocean winds blow upon the Star Spangled Banner and the Guam Flag that
    fly high above Government House. Freedom has no end, nor can time limit
    its virtue. No other country was built upon these ideals. It is a
    blessing from God to see the majesty of His creation illuminated by the
    dawn of a new day. Distinguished Ladies and Gentlemen, as an American
    living in a land that wakes to the first sunrise of this vast nation, I
    can tell you that the light of the world touches America first. Let us
    be leaders in this country's future.
                                     ______

        Mr. Fleming. Thank you, Governor. Mr. Gootnick you are now
    recognized for five minutes, sir.

     STATEMENT OF DAVID GOOTNICK, DIRECTOR, INTERNATIONAL AFFAIRS
            AND TRADE, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

        Mr. Gootnick. Thank you, Mr. Chairman.
        Mr. Chairman and Members of this Subcommittee, thank you
    for asking GAO to participate in this hearing. The CNMI economy
    is in a severe recession. The garment factories which once
    fueled an economic boom are closed. Tourism has seen a nearly
    50 percent drop in visitor arrivals. According to figures
    released yesterday by BEA, real GDP fell by 50 percent between
    2003 and 2009, and government revenues have shrunk by nearly 50
    percent as well.
        In this context regarding P.L. 110-229, I will briefly
    summarize, first, DHS operations in the Commonwealth; second,
    the status of implementing regulations; and third, several
    pending issues.
        Regarding DHS operations, the key component units had
    established operations by the start of the transition period.
    CPD is screening over 30,000 arrivals monthly and has admitted
    over 60,000 Russian and Chinese visitors to the Commonwealth.
    They now have a long-term lease and are renovating space at
    both international airports. ICE now has access to a detention
    facility. They have deported about 50 individuals and are
    prioritizing their resources toward criminal aliens. CIS
    continues to process applications for citizenship, permanent
    residency, H visas, parole in place and advance paroles,
    amongst others.
        Regarding the regulations, as has been well stated DHS has
    issued regulations implementing programs for visitors and
    investors, and has recently submitted to OMB a draft rule on
    the transitional work permit program. Regarding workers, the
    delay in issuance of the regulations according to many
    observers has had a negative impact on the economy.
        Regarding visitors, DHS continues to employ the Secretary's
    parole authority and has left the door open for China and
    Russia in the combined visa waiver program. Regarding
    investors, CIS has thus far had far fewer applications for the
    transitional investor visa than they had anticipated.
        Finally, I will raise three pending issues, first on the
    worker regulations. During the transition the DHS regulations
    will provide for the number, terms and conditions associated
    with the worker permits. Labor will decide on any extensions of
    the program beyond 2014. Many sources, including GAO and the
    McFee study, have found that a rapid substantial decline in
    foreign workers would have a negative impact on the economy and
    a substantial one.
        Moreover, given the calendar there is limited time for
    employers to petition for workers, for workers and their
    dependents to complete the required steps, and for CIS to
    process these applications estimated right now at over 15,000.
        Second, on payroll taxes, CNMI workers from the Philippines
    and Korea, currently 75 percent of foreign workers, have in the
    past been exempted from payroll taxes. With the elimination of
    the CNMI immigration categories that form the basis for this
    exemption going forward the Social Security status of these
    workers is unknown.
        Third, on status, Mr. Sablan, as you know your bill would
    create a CNMI-only resident status for four groups of
    individuals. The largest of these groups are certain immediate
    relatives of U.S. citizens. I must respectfully disagree with
    the Governor on his figure of 11,000 individuals. There is not
    a lot of data on this. I think there are two figures that are
    worth nothing.
        In, 2005, the household income and expenditure survey found
    that there were about 8,000 children of non-U.S.-headed
    households, about 8,000 kids; 90 percent of those were U.S.
    citizens. If you figure two kids per family on average, and 90
    percent of that, you get somewhere between three and four
    thousand individual is eligible under the fourth provision in
    H.R. 1466.
        Also, the April 2010 Department of the Interior study
    suggested that there were about 3,000 individuals who are
    immediate relatives of aliens or U.S. citizens, so those are
    probably the two best da ta sources to anchor an estimate on
    immediate relatives of U.S. citizens.
        Also, in April 2010, in a required report, Interior
    recommended that Congress consider among several options
    allowing foreign workers who have resided in the CNMI for at
    least five years to apply for long-term status. This report has
    engendered controversy both on its data source and its options
    for congressional consideration. Nonetheless, the report
    reflected a compromise in the CNRA itself and reflects
    difficult choices still to be made in the role of foreign
    workers in the Commonwealth's future.
        In summary, Mr. Chairman, five basic points: The CNMI
    economy is in a severe prolonged recession; DHS components are
    operational in the Commonwealth; Chinese and Russian visa
    waivers are important to tourism in both Guam and the CNMI; the
    delay in establishing temporary worker program is at present a
    key source of uncertainty; and finally, proposals to grant
    long-term status to certain workers and their families are
    pending before Congress.
        Mr. Chairman, this completes my remarks. I am happy to
    answer your questions.
        [The prepared statement of Mr. Gootnick follows:]

    Statement of David Gootnick, Director, International Affairs and Trade,
                     U.S. Government Accountability Office

        Chairman Fleming, Ranking Member Sablan, and Members of the
    Subcommittee:
        Thank you for the opportunity to discuss our work on the status of
    efforts, in response to the Consolidated Natural Resources Act of 2008
    (CNRA), to establish federal immigration control and implement programs
    for foreign workers, visitors, and investors in the Commonwealth of the
    Northern Mariana Islands (CNMI).\1\
    ---------------------------------------------------------------------------
        \1\ Pub. L. No. 110-229, Title VII, 122 Stat. 754, 853 (May 8,
    2008). 48 U.S.C.Sec. 1806 note.
    ---------------------------------------------------------------------------
        Under the terms of its 1976 covenant with the United States,\2\ the
    CNMI government administered its own immigration systems from 1978 to
    2009, using its authority to admit substantial numbers of foreign
    workers \3\ through a permit program for non-U.S. citizens entering the
    commonwealth. In 2005, these workers represented a majority of the CNMI
    labor force and outnumbered U.S. citizens in most industries, including
    tourism and garment manufacturing. The CNMI also admitted visitors
    through its own entry permit and entry permit waiver programs and
    provided various types of admission to foreign investors.
    ---------------------------------------------------------------------------
        \2\ Covenant to Establish a Commonwealth of the Northern Mariana
    Islands in Political Union with the United States of America (Pub. L.
    No. 94-241, Sec. 1, 90 Stat. 263 (Mar. 24, 1976), 48 U.S.C. Sec. 1801,
    note.
        \3\ In this statement, unless otherwise indicated, ``foreign
    workers'' refers to workers in the CNMI who are not U.S. citizens or
    U.S. lawful permanent residents. (Other sources sometimes call these
    workers ``nonresident workers,'' ``guest workers,'' ``noncitizen
    workers,'' ``alien workers,'' or ``nonimmigrant workers.'') ``Foreign
    workers'' does not refer to workers from the Freely Associated States--
    the Federated States of Micronesia, Republic of the Marshall Islands,
    and Republic of Palau--who are permitted to work in the United States,
    including the CNMI, under the Compacts of Free Association (48 U.S.C.
    Sec. 1901 note, 1921 note, and 1931 note). In this statement, foreign
    workers may include aliens who are immediate relatives of U.S. citizens
    or U.S. permanent residents.
    ---------------------------------------------------------------------------
        CNRA required that GAO report on the implementation of federal
    immigration law in the CNMI 2 years after the date of enactment, which
    was May 8, 2008. In August 2008, we reported that decisions by the
    Secretary of Homeland Security, in conjunction with other departments,
    in implementing CNRA's provisions regarding foreign workers, visitors,
    and investors would largely determine its impact on the CNMI's
    economy.\4\ In May 2010, we reported, and testified before this
    subcommittee, that several Department of Homeland Security (DHS)
    components--U.S. Customs and Border Protection (CBP), U.S. Immigration
    and Customs Enforcement (ICE), and U.S. Citizenship and Immigration
    Services (USCIS)\5\--had established border control operations in the
    CNMI in 2009 but had not concluded negotiations with the CNMI
    government to resolve certain challenges involving access to CNMI
    airport space, detention facilities, and databases.\6\ We also noted
    that DHS had not yet finalized regulations needed to fully implement
    CNRA provisions affecting foreign workers, visitors, and investors.
    ---------------------------------------------------------------------------
        \4\ GAO, Commonwealth of the Northern Mariana Islands: Managing
    Potential Economic Impact of Applying U.S. Immigration Law Requires
    Coordinated Federal Decisions and Additional Data, GAO-08-791
    (Washington, D.C.: Aug. 4, 2008).
        \5\ CBP is the lead federal agency charged with keeping terrorists,
    criminals, and inadmissible aliens out of the country while
    facilitating the flow of legitimate travel and commerce at the nation's
    borders. ICE is responsible for enforcing immigration laws within the
    United States, including, but not limited to, identifying,
    apprehending, detaining, and removing aliens who commit crimes and
    aliens who are unlawfully present in the United States. USCIS processes
    applications for immigration benefits--that is, the ability of aliens
    to live, and in some cases to work, in the United States permanently or
    temporarily or to apply for citizenship.
        \6\ GAO, Commonwealth of the Northern Mariana Islands: DHS Should
    Conclude Negotiations and Finalize Regulations to Implement Federal
    Immigration Law, GAO-10-553 (Washington, D.C.: May 7, 2010); and GAO,
    Commonwealth of the Northern Mariana Islands: DHS Needs to Conclude
    Negotiations and Finalize Regulations to Implement Federal Immigration
    Law, GAO-10-671T (Washington, D.C.: May 18, 2010). In our May 2010
    report, we recommended that DHS and its components establish strategic
    approaches and time frames for concluding its negotiations; DHS agreed
    with our recommendation. For a list of related products, see GAO-10-
    553, page 82.
    ---------------------------------------------------------------------------
        My statement today will briefly describe CBP, ICE, and USCIS
    immigration and border control operations in the CNMI, including
    progress in negotiating solutions to the challenges we identified in
    May 2010. In addition, I will describe the status of regulations
    implementing CNRA-required programs for foreign workers, visitors, and
    investors. Finally, I will discuss some pending issues, several of
    which may lead to future challenges related to U.S. immigration control
    in the CNMI.
        This statement is based on our prior reports,\7\ updated with
    information provided by DHS and the Department of the Interior (DOI)
    and obtained in interviews with DHS officials in California, the CNMI,
    Hawaii, and Washington, D.C. In general, to establish the reliability
    of the data that DHS uses to document arrivals, aliens, and benefits in
    the CNMI, we systematically obtained information about the ways that
    DHS components collect and tabulate data. When possible, we checked for
    consistency across data sources. Although the available data had some
    limitations, we determined that the data were adequate and sufficiently
    reliable for the purposes of our review. We also interviewed private
    sector representatives in the CNMI regarding implementation. The
    information contained in this testimony was reviewed for technical
    accuracy by DHS officials. We conducted our work for this statement
    from May 2011 to July 2011 in accordance with generally accepted
    government auditing standards.\8\
    ---------------------------------------------------------------------------
        \7\ GAO-08-791 and GAO-10-553.
        \8\ Additional information on our scope and methodology is
    available in prior reports.
    ---------------------------------------------------------------------------
    Background
        The CNMI's economy is in a prolonged recession due to the departure
    of its garment industry and decline in its tourism industry. Until
    recently, the garment industry was central to the CNMI economy and
    employed close to a third of all workers. However, by early 2009, the
    last garment factory had closed. The tourism industry has declined as
    visitor arrivals to the CNMI decreased by 49 percent, from a peak of
    about 727,000 in 1997 to roughly 368,000 in 2010. As the economy
    contracted, the CNMI's real gross domestic product dropped at an
    estimated average annual rate of 4.2 percent from 2002 to 2007.\9\ In
    addition, revenues available for appropriation by the CNMI government
    have fallen by 45 percent, from $240 million in fiscal year 2005 to an
    estimated $132 million for fiscal year 2011. Moreover, since 2007,
    labor costs have increased following the application of the federal
    minimum wage in the CNMI.\10\
    ---------------------------------------------------------------------------
        \9\ U.S. Department of Commerce's Bureau of Economic Analysis,
    ``The Bureau of Economic Analysis (BEA) releases estimates of the major
    components of gross domestic product of the Commonwealth of the
    Northern Mariana Islands,'' news release, June 6, 2010.
        \10\ GAO, American Samoa and Commonwealth of the Northern Mariana
    Islands: Employment, Earnings, and Status of Key Industries Since
    Minimum Wage Increases Began, GAO-11-427 (Washington, D.C.: June 23,
    2011).
    ---------------------------------------------------------------------------
        Certain provisions in CNRA were intended to minimize the potential
    adverse economic and fiscal effects associated with phasing out a CNMI
    government permit program for foreign workers and to maximize the
    CNMI's potential for economic and business growth. These provisions
    were to apply during a 5-year transition period that began on November
    28, 2009, and ends in 2014. In particular:
              CNMI government-issued permits. Under CNRA,
            foreigners who lack U.S. immigration status but were admitted
            under the CNMI's immigration laws prior to November 2009, may
            continue to live and work in the commonwealth for 2 years after
            that date or until their CNMI government-issued permits expire,
            whichever is earlier. The CNMI issued temporary permits
            authorizing the holders to remain in the commonwealth after
            November 28, 2009, for a maximum of 2 years consistent with the
            terms of the permit. These ``umbrella'' permits also include
            provisions for extending, transferring, and seeking employment.
            CNRA's authorization for individuals with these permits to
            remain in the CNMI without U.S. immigration status will expire
            on November 27, 2011.
              CNMI-only transitional work permits. CNRA authorizes
            a federal CNMI-only transitional work permit program and
            authorizes the Secretary of Homeland Security to determine the
            number, terms, and conditions of these permits, which must be
            reduced to zero by the end of the transition period and any
            extensions of the CNMI-only work permit program by the
            Secretary of Labor.\11\
    ---------------------------------------------------------------------------
        \11\ CNRA authorizes the Secretary of Labor to extend the CNMI-only
    transitional work permit program indefinitely for up to 5 years at a
    time. The Secretary may issue the extension as early as desired within
    the transition period and up to 180 days before the end of the
    transition period or any extensions of the CNMI-only transitional work
    permit program. The legislation instructs the Secretary to base this
    decision on the labor needs of legitimate businesses in the CNMI. To
    determine these needs, the Secretary may consider (1) workforce studies
    on the need for foreign workers, (2) the unemployment rate of U.S.
    citizen workers in the CNMI, and (3) the number of unemployed foreign
    workers in the CNMI, as well as other information related to foreign
    worker trends. In addition, the Secretary of Labor is to consult with
    the secretaries of the departments of Homeland Security, the Interior,
    and Defense and the Governor of the CNMI in making this determination.
    ---------------------------------------------------------------------------
              CNMI nonimmigrant investor status. CNRA provides for
            current CNMI foreign investors who meet certain requirements to
            convert their status from CNMI investor to federal nonimmigrant
            treaty investor during the transition period. The Secretary of
            Homeland Security is to determine whom this ``grandfathered''
            status applies to and how long it is valid.
        In addition, CNRA amended existing U.S. immigration law to
    establish a joint visa waiver program for the CNMI and Guam that
    replaced an existing visa waiver program for Guam visitors.
    DHS Has Continued Immigration and Border Control Operations and
            Concluded Some Negotiations with the CNMI Government
        U.S. Customs and Border Protection. As of April 30, 2011, CBP
    officers at the Saipan and Rota airports had admitted 514,828 arriving
    travelers--an average of about 30,300 per month--granting 68,764 (13
    percent) requests for parole since beginning operations in November
    2009.\12\ The Marianas Visitors Authority reported that 77 percent of
    arriving travelers in fiscal year 2010 came from Japan or South Korea.
    According to CBP data, of the arriving travelers who were granted
    parole, 56,376 (82 percent) were from China, 6,751 (10 percent) were
    from Russia, and the remaining travelers were from other countries.
    (See table 1.)
    ---------------------------------------------------------------------------
        \12\ A grant of parole is official permission for an otherwise
    inadmissible alien to be physically present in the United States
    temporarily. Parole is determined on a case-by-case basis, and all
    applicants for admission are subject to inspection and removal if
    determined to be inadmissible for reasons other than lack of a visa. On
    October 21, 2009, the Secretary of Homeland Security announced to
    Congress and the Governors of the CNMI and Guam that she will exercise
    her discretionary authority to parole into the CNMI visitors for
    business or pleasure who are nationals of the Russian Federation and
    the People's Republic of China.
    [GRAPHIC] [TIFF OMITTED] 67403.003

        .epsIn October 2010, CBP concluded negotiations with the CNMI
    government and both parties signed a long-term lease agreement that
    includes permission to renovate airport operating space in Saipan and
    Rota. In February 2011, CBP began to renovate approximately 14,000
    square feet of inspection space at the Saipan International
    Airport.\13\ DHS expects to complete the renovations in both Saipan and
    Rota by September 2011, at a total cost of $14.2 million.
    ---------------------------------------------------------------------------
        \13\ CBP originally occupied approximately 9,390 square feet of
    airport space at the Saipan International Airport and sought access to
    approximately 7,200 additional square feet to bring the facility up to
    DHS standards. The CNMI agreed to provide CBP 5,001 more square feet in
    the inspection areas for, among other things, renovation of
    administration offices, access to public restrooms, and construction of
    three holding cells and two interview rooms.
    ---------------------------------------------------------------------------
        U.S. Immigration and Customs Enforcement. As of May 31, 2011, ICE
    officials detailed to Saipan had identified 1,654 individuals in
    potential violation of U.S. immigration laws, initiating removal
    proceedings for 236 of these cases. Decisions had been rendered for 133
    of the removal cases, 48 of which resulted in removal.\14\
    ---------------------------------------------------------------------------
        \14\ With the implementation of federal immigration, CNMI courts no
    longer have the authority to issue deportation orders. ICE's Chief
    Counsel has an office on the island of Saipan, but the office has no
    permanent attorney or staff. Instead, attorneys represent DHS in
    removal hearings from ICE's Honolulu office, either through video
    teleconferencing or temporary assignments to Saipan.
    ---------------------------------------------------------------------------
        In April 2011, ICE concluded negotiations with the CNMI government
    for access to detention space in the CNMI correctional facility.\15\
    Under a 2007 agreement between the U.S. Marshals Service and the CNMI
    Department of Corrections, the CNMI adult correctional facility in
    Saipan provided the U.S. government 25 detention beds at a daily rate
    of $77 per bed. Under the 2011 agreement between ICE and the CNMI
    government, the CNMI will provide up to 350 detention beds at a daily
    rate of $89 per bed, including related detention services.\16\ ICE
    began detaining aliens at the Saipan detention facility on June 6,
    2011, and expects to use approximately 20 beds until the end of fiscal
    year 2011.
    ---------------------------------------------------------------------------
        \15\ ICE uses detention space to hold certain aliens while
    processing them for removal or until their scheduled hearing dates. ICE
    acquires detention space by negotiating intergovernmental service
    agreements with state and local detention facilities, using federal
    facilities, and contracting with private service contracting
    facilities.
        \16\ ICE's agreement with the CNMI government includes, in addition
    to bed space, services that the CNMI detention center will provide when
    receiving and discharging ICE administrative detainees as well as basic
    needs, financial liability, transportation, and medical services for
    detainees and office space for ICE officials at the Saipan detention
    facility. The agreement was effective April 20, 2011, and will remain
    in effect for 5 years, with the option to extend.
    ---------------------------------------------------------------------------
        Although negotiations with the CNMI government have not resulted in
    DHS components' gaining direct access to CNMI immigration and border
    control databases, the CNMI government has increased its responsiveness
    to requests for information, according to ICE officials.\17\
    ---------------------------------------------------------------------------
        \17\ In May 2010, we reported that DHS was negotiating with the
    CNMI government for direct access to several databases that the CNMI
    has used to record the permit status of certain aliens and to track the
    arrivals and departures of travelers. See GAO-10-553. For more
    information about these databases--the Labor Information Data System
    and the Border Management System--see GAO, Commonwealth of the Northern
    Mariana Islands: Immigration and Border Control Databases, GAO-10-345R
    (Washington, D.C.: Feb. 16, 2010).
    ---------------------------------------------------------------------------
        U.S. Citizenship and Immigration Services. Since March 2009, USCIS
    has operated an Application Support Center in Saipan, where two full-
    time staff provide information, interview residents currently eligible
    to apply for lawful permanent resident status or citizenship, and
    process requests requiring biometric services such as fingerprints or
    photographs. As of June 1, 2011, USCIS had processed 1,033 CNMI
    applications for permanent residency and 96 CNMI applications for
    naturalization or citizenship, according to data provided by USCIS
    officials. In addition, USCIS had received 6,966 requests for advance
    parole, granting 97 percent of them, and had granted parole-in-place
    status to 2,625 individuals.\18\ Also, from October 2010 to June 2011,
    USCIS granted nonimmigrant H-visas and other categories of worker
    status classification for 67 individuals.
    ---------------------------------------------------------------------------
        \18\ Advance parole allows aliens in the United States who would
    otherwise be inadmissible to travel abroad and return. Parole-in-place
    protects eligible foreign nationals who do not qualify for any other
    status from being removed or deported from the CNMI. On April 21, 2010,
    USCIS announced that it will grant parole-in-place to eligible foreign
    nationals without umbrella permits whose CNMI work permits or CNMI
    investor permits expire before the CNMI-only transitional worker
    program and CNMI investor status are available.
    ---------------------------------------------------------------------------
    DHS Has Not Finalized Regulations Affecting Foreign Workers but Has
            Implemented Program for Visitors and Investors
    DHS Has Not Yet Issued Final Rule for CNMI-Only Work Permit Program
        As of July 12, 2011, DHS had not issued a final rule for the CNMI-
    only work permit program and the permits were not available.\19\ DHS
    previously issued an interim final rule in October 2009 that was to
    take effect on November 28, 2009;\20\ however, prior to the transition
    date, the federal District Court for the District of Columbia granted
    the CNMI government's request for an order barring implementation of
    the interim final rule.\21\ DHS reopened the comment period from
    December 2009 to January 2010 and, after considering comments that it
    received, submitted draft final regulations for the program to the
    Office of Management Budget in June 2011.
    ---------------------------------------------------------------------------
        \19\ Employers of foreign workers residing in the CNMI can also
    apply for other federal immigration categories such as H-2B temporary
    or seasonal work status, if eligible.
        \20\ Commonwealth of the Northern Mariana Islands Transitional
    Worker Classification, 74 Fed. Reg. 55094 (Oct. 27, 2009). An interim
    final rule allows an agency to implement federal regulations but retain
    the flexibility to amend them as necessary in the future. When issuing
    the interim final rule, DHS announced that it would accept comments in
    developing the final rule but was not following notice-and-comment
    rulemaking procedures, asserting that it had good cause not to do so.
        \21\ Commonwealth of the Northern Mariana Islands v. United States,
    No. 08-1572 686 F. Supp. 2d 7 (D.D.C. Nov 25, 2009). See GAO-10-553 for
    more details.
    ---------------------------------------------------------------------------
        According to CNMI government officials and private sector
    representatives, the delayed issuance of DHS's final rule has had a
    negative impact on the CNMI economy.
              In a May 2010 letter to the Secretary of the
            Interior, the Governor of the CNMI stated that the lack of
            final regulations had dramatically slowed foreign investment,
            travel from other countries, and private sector growth.
              The CNMI Attorney General and the Governor's Special
            Legal Counsel noted that the lack of a CNMI-only federal worker
            permit program has contributed to uncertainty among CNMI
            employers and workers with respect to the status of foreign
            workers with or without a CNMI umbrella permit and that many
            CNMI foreign investors have left the community.
              According to Saipan Chamber of Commerce officials,
            without the final regulations, workers are unable to plan their
            lives and companies cannot estimate their investments and
            budgets.
              The former manager of a health clinic for women,
            infants, and children stated that a large number of unemployed
            contract workers have remained in the CNMI hoping for some
            beneficial result of implementation of federal immigration.
        DHS officials acknowledged that significant consequences will occur
    if the CNMI-only foreign worker regulations are not implemented by
    November 27, 2011, when CNRA's authorization for individuals holding
    the CNMI-issued umbrella permits to remain in the commonwealth will
    expire.
    DHS Implemented Guam-CNMI Visa Waiver Program and Is Still Considering
            Inclusion of China and Russia
        In January 2009, DHS issued an interim final rule for the Guam-CNMI
    Visa Waiver Program, which has operated since November 2009. The rule
    allows visitors for business or pleasure from 12 countries or
    geographic areas \22\ to apply to enter the CNMI and Guam for stays of
    up to 45 days without a nonimmigrant visa.
    ---------------------------------------------------------------------------
        \22\ The interim final rule for the Guam-CNMI Visa Waiver Program
    lists Australia, Brunei, Hong Kong, Japan, Malaysia, Nauru, New
    Zealand, Papua New Guinea, Republic of Korea, Singapore, Taiwan, and
    the United Kingdom as participants in the program. Japan and Korea are
    the two largest tourism markets for the CNMI and Guam. In March 2011,
    DHS added individuals from Hong Kong who hold a British National
    Overseas passport to those eligible for admission under the program.
    ---------------------------------------------------------------------------
        Prior to the issuance of the interim final rule, representatives of
    the CNMI and Guam governments asked that China and Russia be included
    in the Guam-CNMI Visa Waiver Program, because visitors from those
    countries provide significant economic benefits.\23\ However, DHS
    decided not to include China and Russia in the interim final rule,
    citing political, security, and law enforcement concerns, including
    high nonimmigrant visa refusal rates. DHS is still considering whether
    or not to include these two countries in the Guam-CNMI Visa Waiver
    Program. Meanwhile, CBP continues to parole Chinese and Russian
    nationals into the CNMI on a case-by-case basis. According to CNMI
    officials, the exclusion of Chinese and Russian nationals from the
    Guam-CNMI Visa Waiver Program has increased economic uncertainty in the
    CNMI, affecting investments in support of the Chinese and Russian
    tourism markets.
    ---------------------------------------------------------------------------
        \23\ CNRA states that regulations for the Guam-CNMI Visa Waiver
    Program shall provide for a listing of any country from which the
    Commonwealth has received a significant economic benefit from the
    number of visitors for pleasure within the 1-year period preceding the
    date of enactment, unless the Secretary of Homeland Security determines
    that such country's inclusion on such list would represent a threat to
    the welfare, safety, or security of the United States or its
    territories. See 8 U.S.C. Sec. 1182(1)(3)(A).
    ---------------------------------------------------------------------------
    DHS Finalized Rule Providing CNMI Investor Status to Long-Term Foreign
            Investors
        In December 2010, DHS issued a final rule that allows a large
    proportion of investors holding CNMI long-term foreign investor permits
    to obtain U.S. CNMI-only nonimmigrant treaty investor status during the
    transition period. Eligibility criteria for this status--known as E-2
    CNMI investor status \24\--during the transition period include, among
    others, having been physically present in the CNMI for at least half
    the time since obtaining CNMI investor status and providing evidence of
    maintaining financial investments in the CNMI. In response to public
    comments received on the proposed rule, the final rule reduces the
    minimum investment required to obtain this status from $150,000 to
    $50,000 for investors holding CNMI long-term business investor
    permits.\25\
    ---------------------------------------------------------------------------
        \24\ E-2 Nonimmigrant Status for Aliens in the Commonwealth of the
    Northern Mariana Islands with Long-Term Investor Status. 74 Fed. Reg.
    79,264 (Dec. 20, 2010).
        \25\ CNRA establishes that current CNMI foreign investors who meet
    certain requirements can convert from CNMI long-term investor status to
    U.S. CNMI-only nonimmigrant treaty investor status during the
    transition period.
    ---------------------------------------------------------------------------
        As of June 2011, USCIS had approved 22 applications for E-2 CNMI
    investor status, far fewer than the 512 applications it had
    anticipated.\26\ However, DHS officials predicted a surge in
    applications for E-2 CNMI investor status prior to the expiration of
    CNMI government-issued foreign investor permits on November 27, 2011.
    ---------------------------------------------------------------------------
        \26\ According to a senior USCIS official, many Japanese and Korean
    investors apply for regular E-2 status at their local U.S. embassy
    rather than through USCIS.
    ---------------------------------------------------------------------------
    Several Pending Issues Could Lead to Future Challenges
    Content and Implementation of Regulations for CNMI-Only Work Permit
            Program Will Determine Impact on CNMI Economy
        The content and implementation of DHS's final rule for the CNMI-
    only work permit program will largely determine its potential impact on
    CNMI's economy. The rule will establish, as required by CNRA, a system
    for allocating and determining the number, terms, and conditions of
    permits to be issued to prospective employers. In particular, CNRA
    requires that the number of permits issued annually during the
    transition period be reduced to zero by the end of 2014 or any
    extensions of the permit program. Because foreign workers comprise a
    large proportion of the CNMI labor market--59 percent in 2009,
    according to the CNMI Department of Labor--any substantial and rapid
    reduction in the numbers of CNMI-only permits for foreign workers would
    have a negative effect on the size of the CNMI labor force and
    therefore on the CNMI economy. In addition, the interaction of DHS and
    U.S. Department of Labor decisions about, respectively, the number of
    permits to allocate annually and whether and when to extend the permit
    program past 2014 will significantly affect employers' access to
    foreign workers.\27\
    ---------------------------------------------------------------------------
        \27\ See GAO-08-791 for our analysis of the potential impacts of
    DHS and U.S. Department of Labor decisions in implementing the CNMI-
    only work permit program. On March 25, 2011, DHS, and the departments
    of the Interior, Justice, Labor, and State finalized a memorandum of
    agreement that set forth the parameters of the working relationships
    and responsibilities for implementation of CNRA in the CNMI.
    ---------------------------------------------------------------------------
    Limited Time Is Available for Submitting and Processing CNMI-Only Work
            Permit Applications
        The time available for submission and processing of applications
    for CNMI-only work permits will depend on the timing of DHS's issuance
    of its final rule implementing the program and on the content of that
    rule.\28\ A senior DHS official estimates that approximately 15,000
    workers and their dependents will be covered by the program. According
    to a USCIS official, once DHS issues the final rule, CNMI employers
    will submit paperwork petitioning for workers to receive the permits;
    workers will submit biometrics, including fingerprints; and USCIS will
    process the submitted paperwork and biometrics.\29\ CNRA's
    authorization for individuals with CNMI-issued permits to remain in the
    CNMI without U.S. immigration status will expire on November 27, 2011.
    ---------------------------------------------------------------------------
        \28\ In its enjoined interim final rule, DHS proposed a new CNMI-
    only transitional worker classification, CW-1 status, which it deemed
    to be synonymous with the term ``permit'' referenced in CNRA.
        \29\ DHS did not provide the content of the draft final rule for
    our review. However, generally for other nonimmigrant employment based
    petitions, USCIS and the Department of Labor require that employers
    submit an attestation regarding wage and labor condition, along with
    all other required paperwork, to USCIS and pay a fee. Similarly,
    employees must complete all required paperwork for relatives and
    dependents; submit the paperwork and biometrics, such as fingerprints
    and photos, to USCIS; and pay any necessary processing fee.
    ---------------------------------------------------------------------------
        In 2009, USCIS anticipated needing nine staff for its California
    Service Center to process the influx of CNMI applications and
    petitions.\30\ Currently, four USCIS staff were are assigned to this
    task and five more are trained to work on CNMI-related cases. Depending
    on the number of petitions received and the time required to process
    them, USCIS anticipates training an additional 10 to 14 officers after
    the rule is implemented, according to USCIS officials. USCIS officials
    said that it could take up to 90 days for employers to prepare the
    petitions, for workers to submit the biometrics, and for USCIS to
    conduct the relevant background and security checks required of all
    applicants for U.S. immigration benefits.\31\
    ---------------------------------------------------------------------------
        \30\ According to USCIS officials, all applications and petitions
    from the CNMI that do not require face-to-face interviews are processed
    at USCIS's California Service Center.
        \31\ For example, according to USCIS California Service Center
    staff, in processing applications for immigration benefits USCIS staff
    must consider all evidence submitted to adjudicate the petition or
    application, such as by confirming status; conducting background checks
    (i.e., checking applicants' names and fingerprints against a Federal
    Bureau of Investigations system and Interagency Border and Inspection
    systems); and considering other relevant factors. On December 14, 2010,
    USCIS issued guidance on how certain aliens can be granted nonimmigrant
    status in the CNMI under federal immigration law (USCIS-PM-602-0012).
    ---------------------------------------------------------------------------
    Social Security Coverage for Certain Foreign Workers Is Unknown
        With the elimination of CNMI immigration categories and the
    transition to federal immigration law, the future status of certain
    Filipino and Korean workers and their employers with regard to the
    Social Security payroll tax is unknown. According to the Social
    Security Administration (SSA), Filipino and Korean workers who were
    admitted to the commonwealth under CNMI immigration law are not
    currently covered by Social Security. Specifically, a 1997 SSA document
    states that, because the U.S.-CNMI covenant provides for federal laws
    on Social Security taxes to apply to the CNMI as they apply to
    Guam,\32\ the Internal Revenue Service (IRS) determined that the
    employment of Filipino and Korean contract workers admitted to the
    commonwealth under Section 706(K) of the CNMI immigration law was not
    covered by the U.S. Social Security Act.\33\ Our review of SSA data for
    2009 found that the data excluded Filipino and Korean workers, and SSA
    officials told us that Social Security payroll taxes are not withheld
    from these workers' earnings.\34\ Data for 2009 from the CNMI Division
    of Revenue and Tax show that workers from Korea and the Philippines
    totaled 12,406 and represented 75 percent of foreign workers, or 44
    percent of all workers, in the CNMI.\35\
    ---------------------------------------------------------------------------
        \32\ Covenant Sec. 606(b).
        \33\ Social Security Administration, ``Social Security Taxes:
    Filipino and Korean Contract Workers'' (Saipan: January 16, 1997). The
    Social Security Act states that the definition of ``employment'' does
    not include work performed on Guam by Filipino workers who are admitted
    to Guam on nonimmigrant H-2 visas (see 26 U.S.C. Sec. 3121(b)(18)).
    Article 25 of a treaty between the United States and Korea contains a
    similar provision for Korean workers admitted on H-2 visas to Guam
    (United States-Republic of Korea Income Tax Convention, effective Jan.
    1, 1980). However, article 29 of the U.S.-Korea treaty does not allow
    either country to extend any provision of the treaty to one of its
    territories absent a written agreement that would require
    implementation through diplomatic channels. We were unable to verify
    that the IRS had made this determination with regard to Korean workers.
        \34\ See GAO, American Samoa and Commonwealth of the Northern
    Mariana Islands: Employment, Earnings, and Status of Key Industries
    since Minimum Wage Increases Began, GAO-11-427 (Washington, D.C.: June
    23, 2011), page 28.
        \35\ This information is drawn from W-2 forms prepared by employers
    and submitted to the Division of Tax and Revenue. The division does not
    verify workers' reported citizenship. In calculating the share of CNMI
    foreign workers who are citizens of Korea or the Philippines, we did
    not count citizens of the freely associated states (Micronesia, the
    Marshall Islands, and Palau) as foreign workers.
    ---------------------------------------------------------------------------
        Given the transition to federal immigration law--in particular,
    given the availability of H-2 work visas in the CNMI--it is uncertain
    whether Filipino and Korean workers who obtain CNMI-only work permits
    will be covered by Social Security.\36\ If these workers are deemed to
    be covered, they and their employers will be subject to Social Security
    payroll taxes. The IRS and SSA will need to consider CNRA's impact on
    Filipino and Korean workers with regard to Social Security coverage.
    ---------------------------------------------------------------------------
        \36\ As we reported in May 2008, foreign workers in the CNMI can
    obtain H nonimmigrant worker status upon petition by their employer. H-
    2A visas are available for foreign workers providing temporary or
    seasonal agricultural labor both during and after the initial
    transition period. However, as of December 31, 2007, only 555 foreign
    workers were engaged in private farming, about 3 percent of total
    foreign workers with 706K CNMI nonresident worker entry permits. H-2A
    employers must comply with the federal labor certification process,
    which determines whether the employment is agricultural in nature,
    whether it is open to U.S. workers and if qualified U.S. workers are
    available, whether employment of a qualified alien would have an
    adverse impact, and whether employment conditions (e.g., housing) meet
    applicable requirements (8 C.F.R. Sec. 214.2(h)(5)(ii)). The H-2B
    category applies to residents of foreign countries who are coming to
    the United States temporarily to perform nonagricultural temporary
    labor or service if unemployed persons capable of performing such labor
    or service are unable to be found in the United States (8 U.S.C.
    Sec. 1101(a)(15)(H)(ii)(B)). See GAO-08-791, appendix V.
    ---------------------------------------------------------------------------
    Long-Term Resident Status for Certain CNMI Foreign Workers May Be
            Considered
        Legislation introduced in Congress proposes CNMI resident status
    for certain long-term residents. Also, DOI has recommended that
    Congress consider allowing certain foreign workers in the CNMI to apply
    for long-term resident status.
              A bill introduced in the House of Representatives
            provides for CNMI-only resident status for certain long-term
            residents of the CNMI.\37\ To be eligible to qualify for this
            status, an individual must be either (1) born in the CNMI
            between January 1, 1974, and January 9, 1978; (2) classified by
            the CNMI government as a permanent resident; (3) a spouse or
            child of an individual covered by (1) or (2); or (4) an
            immediate relative of a U.S. citizen on May 8, 2008.
    ---------------------------------------------------------------------------
        \37\ H.R. 1466, 112th Cong., (Apr. 8, 2011).
    ---------------------------------------------------------------------------
              In April 2010, DOI recommended that Congress consider
            permitting guest workers who have lawfully resided in the CNMI
            for a minimum of 5 years--which DOI estimated at 15,816
            individuals \38\--to apply for long-term resident status \39\
            under the Immigration and Nationality Act. DOI recommended that
            Congress consider allowing these workers to apply for one of
            the following: (1) U.S. citizenship; (2) permanent resident
            status leading to U.S. citizenship (per the normal provisions
            of the INA relating to naturalization), with the 5-year minimum
            residence spent anywhere in the United States or its
            territories; or (3) permanent resident status leading to U.S.
            citizenship, with the 5-year minimum residence spent in the
            CNMI. Additionally, DOI noted that under U.S. immigration law,
            special status is provided to individuals who are citizens of
            the freely associated states. Following this model, DOI
            suggested that foreign workers could be granted a nonimmigrant
            status, like that negotiated for citizens of the freely
            associated states, and allowed to live and work either in the
            United States and its territories or in the CNMI only.
    ---------------------------------------------------------------------------
        \38\ DOI conducted a voluntary registration of aliens residing in
    the CNMI in 2009. DOI reported that as of January 2010, there were
    20,859 aliens in the commonwealth, of whom 16,304 were workers and
    15,816 had resided lawfully in the CNMI for at least 5 years. DOI
    concluded that two groups were underrepresented in the registration:
    citizens from the freely associated states and illegal aliens. See
    Secretary of the Interior, Report on the Alien Worker Population in the
    Commonwealth of the Northern Mariana Islands (Washington, D.C.:
    Department of the Interior, 2010). DOI evaluated its data as consistent
    with CNMI data for 2008 that showed 22,000 to 24,000 foreign worker
    permit holders as well as 19,404 umbrella permits issued by the CNMI
    Department of Labor. The government of the CNMI has challenged the
    validity of DOI's data collection and analysis; however, DOI has stood
    by its report. Litigation regarding DOI's data collection effort is
    currently ongoing.
        \39\ CNRA required the Secretary of the Interior to report to
    Congress on any recommendations he may deem appropriate related to
    whether or not the Congress should consider permitting lawfully
    admitted guest workers lawfully residing in the Commonwealth on such
    enactment date to apply for long-term status under the immigration and
    nationality laws of the United States. See 48 U.S.C. Sec. 1806(h)(5).
    ---------------------------------------------------------------------------
        In conclusion, Mr. Chairman: I testified in May 2010 that DHS
    components had made some progress in establishing federal border
    control in the CNMI but that their inability to conclude negotiations
    with the CNMI government had resulted in continuing operational
    challenges. I also reported that programs for workers and investors
    were not yet available to eligible individuals and that DHS had not
    determined whether or not to include Chinese and Russian nationals in
    the Guam-CNMI Visa Waiver Program. In the past year, DHS has resolved
    many of those operational challenges and has finalized investor
    regulations. However, it has yet to finalize rules for the CNMI-only
    transitional work permit program, and limited time remains for the
    submission and processing of approximately 15,000 workers' and their
    dependents' applications for these permits. These issues, as well as
    the unknown future status of Filipino and Korean workers' coverage by
    U.S. Social Security, could impact the CNMI's economy as the November
    27 deadline approaches.
        Chairman Fleming, Ranking Member Sablan, and Members of the
    Subcommittee, this completes my prepared statement. I would be happy to
    respond to any questions you may have at this time.
    GAO Contact and Staff Acknowledgments
    GAO Contact David Gootnick, (202) 512-3149 or gootnickd@gao.gov
    Staff Acknowledgements
        In addition to the person named above, Emil Friberg, Assistant
    Director; Michael P.Dino, Assistant Director; Ming Chen; Julia Ann
    Roberts; Ashley Alley; and Reid Lowe made key contributions to this
    report. Technical assistance was provided by Ben Bolitzer, Marissa
    Jones, Giff Howland, and Bradley Hunt.
        This is a work of the U.S. government and is not subject to
    copyright protection in the United States. The published product may be
    reproduced and distributed in its entirety without further permission
    from GAO. However, because this work may contain copyrighted images or
    other material, permission from the copyright holder may be necessary
    if you wish to reproduce this material separately.
    GAO's Mission
        The Government Accountability Office, the audit, evaluation, and
    investigative arm of Congress, exists to support Congress in meeting
    its constitutional responsibilities and to help improve the performance
    and accountability of the federal government for the American people.
    GAO examines the use of public funds; evaluates federal programs and
    policies; and provides analyses, recommendations, and other assistance
    to help Congress make informed oversight, policy, and funding
    decisions. GAO's commitment to good government is reflected in its core
    values of accountability, integrity, and reliability.
    Obtaining Copies of GAO Reports and Testimony
        The fastest and easiest way to obtain copies of GAO documents at no
    cost is through GAO's Web site (www.gao.gov). Each weekday afternoon,
    GAO posts on its Web site newly released reports, testimony, and
    correspondence. To have GAO e-mail you a list of newly posted products,
    go to www.gao.gov and select ``E-mail Updates.''
    Order by Phone
        The price of each GAO publication reflects GAO's actual cost of
    production and distribution and depends on the number of pages in the
    publication and whether the publication is printed in color or black
    and white. Pricing and ordering information is posted on GAO's Web
    site, http://www.gao.gov/ordering.htm.
        Place orders by calling (202) 512-6000, toll free (866) 801-7077,
    or TDD (202) 512-2537.
        Orders may be paid for using American Express, Discover Card,
    MasterCard, Visa, check, or money order. Call for additional
    information.
    To Report Fraud, Waste, and Abuse in Federal Programs
        Contact:
        Web site: www.gao.gov/fraudnet/fraudnet.htm E-mail:
    fraudnet@gao.gov Automated answering system: (800) 424-5454 or (202)
    512-7470
    Congressional Relations
        Ralph Dawn, Managing Director, dawnr@gao.gov, (202) 512-4400 U.S.
    Government Accountability Office, 441 G Street NW, Room 7125
    Washington, DC 20548
    Public Affairs
        Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800
    U.S. Government Accountability Office, 441 G Street NW, Room 7149
    Washington, DC 20548
                                     ______

    July 14, 2011

                  COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
                status of transition to federal immigration law
    Why GAO Did This Study
        In May 2008, the United States enacted the Consolidated Natural
    Resources Act (CNRA), amending the United States' covenant with the
    Commonwealth of the Northern Mariana Islands (CNMI) to establish
    federal control of CNMI immigration in 2009, with several CNMI-specific
    provisions affecting foreign workers and investors during a 5-year
    transition period that began on November 28, 2009, and ends in 2014.
    One of these provisions authorizes a transitional CNMI-only work permit
    program that may be extended for up to 5 years at a time past 2014. In
    addition, CNRA amends existing U.S. immigration law to establish a
    joint visa waiver program for the CNMI and Guam. CNRA requires that GAO
    report on implementation of federal immigration law in the CNMI 2 years
    after enactment.
        In May 2010, GAO reported that the Department of Homeland Security
    (DHS) had established border control operations in the CNMI in 2009 but
    had not concluded negotiations with the CNMI government to resolve
    certain challenges involving access to CNMI airport space, detention
    facilities, and databases. GAO also noted that DHS had not yet
    finalized regulations needed to fully implement CNRA provisions
    affecting foreign workers, visitors, and investors.
        This statement updates GAO's May 2010 findings regarding the
    transition to federal immigration law and discusses several pending
    issues. GAO based its statement on prior reports, information provided
    by DHS and the Department of the Interior (DOI), and interviews with
    CNMI private sector officials.
    What GAO Found
        DHS component units Customs and Border Protection (CBP),
    Immigration and Customs Enforcement (ICE), and U.S. Citizenship and
    Immigration Services (USCIS) have continued immigration and border
    control operations in the CNMI. As of April 2011, CBP had processed
    approximately 515,000 arriving travelers in Saipan and Rota. As of May
    2011, ICE had identified approximately 1,700 individuals in potential
    violation of U.S. immigration laws, processing about 240 for removal.
    As of June 2011, USCIS had processed approximately 1,000 CNMI
    applications for permanent residency and 100 CNMI applications for
    naturalization or citizenship. CBP has concluded negotiations with the
    CNMI for operational space at the Saipan and Rota airports, and ICE
    completed negotiations for access to the Saipan detention facility in
    April 2011.
        DHS has not finalized regulations for a federal CNMI-only
    transitional permit program for foreign workers, required by CNRA, but
    has completed regulations implementing other required programs for
    visitors and investors. In June 2011, DHS submitted a draft final rule
    for the CNMI-only permit program to the Office of Management and Budget
    (OMB); currently, the permits remain unavailable. In 2009, DHS issued
    an interim final rule for a Guam-CNMI visa waiver program and the
    program became operational. However, DHS is still considering whether
    to include China and Russia in the program, according to CBP officials.
    In 2010, DHS issued a final rule allowing a large proportion of
    investors holding CNMI long-term foreign investor permits to obtain
    U.S. CNMI-only nonimmigrant treaty investor status during the 5-year
    transition period that began in 2009. DHS has approved about 20
    applications for this status.
        Several pending issues could affect the CNMI's labor market and
    economy. First, the content and implementation of DHS's final rule for
    the federal CNMI-only work permit program will affect CNRA's potential
    impact on the CNMI economy. CNRA requires DHS to determine the number,
    terms, and conditions of the permits, reducing them to zero by the end
    of the transition period in November 2014 or any extension of the
    program past that date. Because of foreign workers' prominence in key
    CNMI industries, any substantial, rapid decline in the permits would
    negatively affect the CNMI economy. Second, CNMI government-issued
    permits to remain in the commonwealth will expire on November 27, 2011.
    Thus, limited time is available for employers to submit petitions for
    workers to receive the federal work permits, for workers and dependents
    to submit biometrics such as fingerprints, and for USCIS to process
    these submissions. Third, with the transition to federal immigration
    law, it is uncertain whether Filipino and Korean workers previously
    admitted under a specific CNMI immigration category--about 75 percent
    of foreign workers in the CNMI in 2009--who obtain CNMI-only work
    permits will be covered by Social Security. In addition to these
    issues, legislation introduced in Congress proposes CNMI resident
    status for certain long-term residents, and DOI has recommended that
    Congress consider allowing certain foreign workers in the CNMI to apply
    for long-term resident status.
                                     ______

        Mr. Fleming. Thank you, Mr. Gootnick, and next is Ms. Ryan,
    you are recognized for five minutes.

    STATEMENT OF KELLY RYAN, ACTING DEPUTY ASSISTANT SECRETARY FOR
     IMMIGRATION AND BORDER SECURITY, OFFICE OF POLICY, DEPARTMENT
                          OF HOMELAND SECURITY

        Ms. Ryan. Thank you. Chairman Fleming, Ranking Member
    Sablan, and other Distinguished Members of the Subcommittee,
    thank you for the opportunity to testify today on the
    Department of Homeland Security's efforts to implement Title
    VII of the Consolidated Natural Resources Act of 2008.
        DHS and our interagency partners have been working hard to
    ensure that we implement the CNRA in a manner that will
    minimize any adverse effects on the CNMI. Since DHS has last
    testified in May 2009, important steps have been taken to
    implement Federal immigration law in the CNMI and in the
    transition program which began on November 28, 2009.
        An issue of great importance to both the CNMI and Guam is
    the CNMI visa waiver program. The CNRA replaced the existing
    Guam visa waiver program with a combined Guam, CNMI VWP that
    allows nationals from participating countries to be admitted to
    Guam, the CNMI, or both for a period of up to 45 days. DHS has
    issued an in interim rule on January 16, 2009, and is
    developing a final rule for the program.
        In recognition of the CNMI's reliance on visitors from
    China and Russia, Secretary Napolitano announced on October 21,
    2009, her decision to exercise her discretionary authority to
    parole into the CNMI only on a case-by-case basis eligible
    visitors for business or pleasure or nationals of the People's
    Republic of China and the Russian Federation.
        Certain provisions of the CNRA affect the CNMI only. DHS
    has worked diligently with its Federal and local partners and
    stakeholders during the transition in implementing Federal
    immigration law in the CNMI. DHS has identified groups of
    individuals who may not necessarily fall within the INA
    classifications and for whom the CNMI classifications
    authorized by the CNRA may not be appropriate.
        To address these challenges, in November 2009 USCIS
    implemented a policy under which USCIS favorably considers
    members of certain designated groups for parole. Currently DHS
    is actively considering additional policy options that it is
    hoped would further reduce the uncertainty associated with the
    ongoing transition to Federal immigration law.
        As part of our implementation efforts, DHS has promulgated
    a number of regulations to set for the processes and procedures
    for seeking Federal immigration status in the CNMI. The CNMI E-
    2 non-immigration investor final rule became effective on
    January 19 in 2011, and it establishes a transition period of
    non-immigrant status for certain foreign investors in the CNMI
    who had been previously granted long-term investor status by
    the CNMI. USCIS has conducted outreach on the E-2 rule in
    Saipan and is currently accepting applications for the program.
        In the fall of 2009, DHS and the Department of Justice
    published an interim final rule to update the current
    immigration regulations to ensure they reflect the changes in
    immigration law made by the CNRA. This interim final rule
    conformed DHS and DOJ regs. to the CNRA, including in the areas
    of employment, verification and asylum. DHS and DOJ currently
    are working toward the issuance of a final rule.
        In October 2009, DHS published a transitional worker
    classification interim final rule. As a result of the pending
    litigation already alluded to those regulations were enjoined.
    DHS is working toward publication of a final rule and we are
    well aware of the concern among CNMI stakeholders about its
    issuance in light of the upcoming statutory expiration of large
    numbers of grandfathered CNMI umbrella permits.
        DHS has designated experienced personnel within its
    relevant components to serve as points of contact and to lead
    teams in the implementation of this transition. As of April
    2011 relevant Federal agencies have completed and signed a
    memorandum agreement required under the CNRA. In addition, DHS
    has submitted to Congress the required resource report on
    implementing Title VII.
        DHS officials have engaged frequently with representatives
    of the CNMI government and private sector stakeholders.
    Meetings have focused on implementation of the Guam-CNMI-VWP
    interim final rule and of the CNRA generally as well as
    obtaining detention space for ICE. DHS has established a full-
    time USCIS, ICE, and CVP presence on the ground in the CNMI.
    Beginning in March 2009 USCIS opened an application support
    center on Saipan. On November 28, 2009, CVP began processing
    flights into the CNMI under U.S. immigration law as well as
    inspection of passengers and performing departure control
    screenings on flights traveling to other U.S. destinations. On
    that same day ICE opened offices on the Island of Saipan.
        Regarding H.R. 1466, DHS shares with its sponsors the
    general view that the unique circumstances of the CNMI deserves
    special consideration. We will carefully examine the bill with
    the sponsors of the legislation to explore particular solutions
    for the groups in the CNMI. DHS recognizes the historic nature
    of the transition and the special circumstances that exist in
    CNMI, especially the economic challenges faced by CNMI in
    restoring its economy, implementing minimum wage increases and
    increasing tourism and other investments. DHS will continue to
    engage in extensive outreach efforts with all the stakeholders
    throughout the transition period.
        Thank you for the opportunity to appear here before the
    Distinguished Members of the Subcommittee, and I would be happy
    to answer any questions.
        [The prepared statement of Ms. Ryan follows:]

    Statement of Kelly Ryan, Acting Deputy Assistant Secretary for Policy,
    Office of Immigration and Border Security, U.S. Department of Homeland
                                    Security

        Chairman Fleming, Ranking Member Sablan, and other distinguished
    Members of the Subcommittee. Thank you for the opportunity to testify
    today on the efforts that the Department of Homeland Security (DHS) has
    undertaken to implement Title VII of the Consolidated Natural Resources
    Act of 2008 (CNRA) (Pub. L. No. 110-229). DHS recognizes the importance
    of the implementation of Title VII of the CNRA to the United States and
    to the people of the Commonwealth of the Northern Mariana Islands
    (CNMI) and Guam. Since the enactment of this historic legislation, DHS
    and its components have been working hard together and with our
    interagency partners to ensure that we implement the CNRA in a manner
    that will minimize any adverse effects on the CNMI. Further, since DHS
    last testified in May 2009, important steps have been taken toward
    implementation of federal immigration law in the CNMI and the
    transition program, which began on November 28, 2009 (the ``transition
    program effective date'').
        Because the CNRA has provisions that affect Guam and the CNMI to
    differing extents, I would like to first address those provisions that
    affect both territories, and then will discuss those provisions that
    are unique to the CNMI.
    The Guam-CNMI Visa Waiver Program
        An issue of great significance to both the CNMI and Guam is the
    Guam-CNMI Visa Waiver Program (VWP). The CNRA replaced the preexisting
    Guam VWP with a combined Guam-CNMI VWP that allows admission to Guam,
    the CNMI, or both for a period up to 45 days. As was the case with the
    former Guam VWP, the program does not provide for onward travel to the
    rest of the United States. The Guam-CNMI VWP is a separate program
    under Section 212 of the Immigration and Nationality Act (INA), and is
    distinct from the Visa Waiver Program authorized for the entire United
    States (including Guam and the CNMI) by Section 217 of the INA. Some
    countries are participants in both programs. A visitor from one of
    those countries arriving in Guam or the CNMI may choose to travel under
    either of the programs, but must comply with all the conditions of
    whichever program is chosen. DHS issued an interim final rule,
    Implementation of the Guam-CNMI Visa Waiver Program, on January 16,
    2009 and is developing a final rule for the program.
        In recognition of the CNMI's reliance on visitors from China and
    Russia, Secretary Napolitano announced on October 21, 2009 her decision
    to exercise her discretionary authority to parole into the CNMI-only,
    on a case-by-case basis, eligible visitors for business or pleasure who
    are nationals of the People's Republic of China (PRC) and Russian
    Federation (Russia).
    Provisions Affecting the CNMI Only
        Certain provisions of the CNRA affect the CNMI only. DHS has worked
    diligently with its federal and local partners and stakeholders in
    developing our approach to implementing the CNRA in the CNMI.
        Through working with the community and both private and public
    parties, DHS has identified groups of individuals who may not
    necessarily fall within the INA classifications and for whom the CNMI
    classifications authorized by the CNRA may not be appropriate. To
    address these challenges, in November 2009, USCIS implemented a policy
    under which USCIS favorably considers members of four designated groups
    for a grant of parole under INA section 212(d)(5), subject to case by
    case review: CNMI permanent residents, immediate relatives of CNMI
    permanent residents, spouses and children of deceased CNMI permanent
    residents, and immediate relatives of citizens of the Freely Associated
    States. Currently, DHS is actively considering additional policy
    options that, it is hoped, will further help to reduce the uncertainty
    associated with the ongoing transition to federal immigration law. In
    so doing, DHS is fully aware of the challenges facing the CNMI economy
    and considers it a priority and goal to support existing businesses
    when developing policies and regulations to implement the legislation.
        As part of our implementation efforts, DHS has promulgated a number
    of regulations to set forth the processes and procedures for seeking
    federal immigration status in the CNMI. The CNMI E-2 Nonimmigrant
    Investor Notice of Proposed Rulemaking was published in September 2009.
    USCIS received and reviewed public comments and published a Final Rule
    on December 20, 2010. This rule, which took effect on January 19, 2011,
    fully implements the CNRA provision that provides during the transition
    period a nonimmigrant status under U.S. immigration law for certain
    foreign investors in the CNMI who had been previously granted long-term
    investor status by the CNMI government. In January of this year, USCIS
    conducted outreach on the regulation in Saipan and is currently
    accepting applications for this program from eligible investors and
    their spouses and children.
        In the fall of 2009, DHS and the Department of Justice and its
    Executive Office for Immigration Review published an interim final rule
    to update the current immigration regulations to ensure they reflect
    the changes in immigration law made by the CNRA. Typically referred to
    as the ``conforming rule,'' this interim final rule amended DHS and DOJ
    regulations to conform them to the CNRA, including in the areas of
    employment verification and asylum. DHS and DOJ currently are working
    toward issuance of a final rule. In October 2009, DHS published the
    Transitional Worker Classification Interim Final Rule. As a result of
    pending litigation, those regulations were enjoined. DHS is working
    toward publication of the Final Rule, which was submitted to the Office
    of Management and Budget (OMB) for official review on June 15, 2011; We
    are well aware of the interest and concern among CNMI stakeholders
    about the issuance of this rule, particularly in light of the upcoming
    statutory expiration on November 27, 2011 of large numbers of
    ``grandfathered'' CNMI work authorization permits.
    Implementation of the CNRA
        DHS has designated experienced personnel within its relevant
    components to serve as points of contact and to lead teams composed of
    Headquarters and Field Office staff to implement the transition to
    federal immigration law in the CNMI. DHS and its interagency partners,
    including the Departments of the Interior, Justice, Labor and State,
    periodically meet to coordinate efforts and identify issues for
    resolution in the CNMI. As of April 2011, all five departments
    (Departments of the Interior, Homeland Security, Justice, Labor and
    State) had completed and signed the Memorandum of Agreement required
    under Section 702 (a) of the CNRA. U.S. Customs and Border Protection
    (CBP), U.S. Immigration and Customs Enforcement (ICE), and U.S.
    Citizenship and Immigration Services (USCIS) representatives have
    participated in meetings in Washington and in the CNMI with
    representatives of the Government of the CNMI and the CNMI private
    sector. DHS has submitted to Congress the required resource report on
    implementing Title VII and in support of the military build-up in Guam
    and, in doing so, identified some of the challenges that remain in
    implementing the legislation. In addition, DHS has met with the
    Delegates from Guam and the CNMI, the Governors of both territories and
    their staffs, as well as other elected officials and interested
    parties. Below is a sample of the most significant dates and meetings
    that have taken place with regard to implementation of the CNRA:
              January 2009--A delegation from DHS Headquarters,
            Richard Vigna, CBP Director of Field Operations for San
            Francisco District, and Bruce Murley and Rocky Miner, the Port
            Directors for Honolulu and Guam, who oversee the Port in the
            CNMI, traveled to Guam and the CNMI to conduct public outreach
            and meet with the territorial governments in support of the
            publication of the Guam-CNMI VWP Interim Final Rule.
              October 2009--A CBP delegation that included
            Assistant Commissioners Thomas Winkowski and Charles Armstrong
            visited Guam and the CNMI in preparation for the November 28,
            2009 transition program effective date. During this visit, the
            CBP delegation met with both the Governor of Guam and the
            Governor of the CNMI regarding implementation of the CNRA.
              February 23, 2011--Meeting between USCIS Director
            Alejandro Mayorkas and CNMI Governor Benigno Fitial, CNMI
            Attorney General Edward Buckingham, and other CNMI government
            representatives. The meeting focused on issues related to
            immigration status and grants of parole in the CNMI.
              February 24, 2011--Meeting between CBP Deputy
            Commissioner David Aguilar, DHS Assistant Secretary for
            Intergovernmental Affairs Betsy Markey and CNMI Governor
            Fitial.
              February 24, 2011--Meeting between ICE Executive
            Associate Director for Enforcement and Removal Operations
            (EAD), Gary Mead, CNMI Governor Fitial, CNMI Attorney General
            Buckingham, and other CNMI government representatives. At this
            meeting, Governor Fitial and EAD Mead reached an agreement in
            principle for an Intergovernmental Service Agreement (IGSA) to
            obtain ICE detention space in the CNMI Department of
            Corrections facility at a bed day rate of $89.
              April 2011--Meeting between Acting Deputy Assistant
            Secretary for Policy Kelly Ryan and Governor of Guam Eddie
            Calvo. The purpose of the meeting was to discuss DHS's
            implementation of the Guam-CNMI VWP.
        DHS implementation efforts have involved establishing a full-time
    presence on the ground in the CNMI. Beginning in March 2009, USCIS
    opened an Application Support Center (ASC) on Saipan to provide
    information to the public and conduct interviews on the island,
    including for adjustment of status and naturalization.
        On November 28, 2009, CBP began processing flights in the CNMI
    under U.S. immigration laws. CBP has officers in Saipan and Rota to
    conduct the inspection of passengers on flights arriving from foreign
    countries and to perform a departure control screening on flights
    traveling to other U.S. destinations.
        On November 28, 2009, ICE Enforcement and Removal Operations (ERO),
    ICE Office of the Chief Counsel (OCC) and Homeland Security
    Investigations (HSI) opened offices on the island of Saipan. Both ERO
    and HSI are responsible for enforcing U.S. immigration laws in the
    CNMI. ERO is responsible for detention and removal of aliens unlawfully
    present in the CNMI, while HSI conducts investigations in such
    programmatic areas as narcotics, money laundering, immigration benefit
    and document fraud, wire fraud, and human smuggling and trafficking.
        As a result of the February 24, 2011 meeting between ICE ERO
    Executive Associate Director Mead and CNMI Governor Fitial, the CNMI
    and ICE agreed to sign an Intergovernmental Service Agreement (IGSA) to
    provide ICE detention space in the CNMI Department of Corrections
    facility at a bed day rate of $89. The IGSA was signed in April 2011
    between ICE and the CNMI Department of Corrections. ERO began housing
    detainees at the Department of Corrections facility on June 6, 2011.
    ERO has funding for 20 beds at the facility through the end of fiscal
    year 2011.
    H.R. 1466
        H.R. 1466, introduced on April 8, 2011, would provide CNMI-only
    status for four designated groups of aliens in the CNMI: (1)
    individuals born in the Northern Mariana Islands between January 1,
    1974 and January 9, 1978; (2) individuals who, as of May 8, 2008, held
    permanent resident status under a provision of CNMI law; (3) spouses
    and children of these two groups; and (4) individuals who, as of May 8,
    2008, were immediate relatives of U.S. citizens (regardless of age;
    i.e., including parents of U.S. citizen children who cannot petition
    for their parents under U.S. immigration law until the children are 21
    years of age). To be eligible, individuals must be otherwise admissible
    to the United States and have resided in the CNMI both on the
    transition program effective date and on the date of enactment of H.R.
    1466. The bill provides status as a permanent resident of the CNMI only
    during the transition period (with no resulting travel privileges to
    any other part of the United States), followed by an opportunity for
    the first three of the four designated groups to apply for adjustment
    to U.S. lawful permanent resident status during calendar year 2015.
                                     ______

        Mr. Fleming. Thank you, Ms. Ryan. Mr. Pula, you are
    recognized for five minutes.

    STATEMENT OF NIKOLAO PULA, DIRECTOR, OFFICE OF INSULAR AFFAIRS,
                    U.S. DEPARTMENT OF THE INTERIOR

        Mr. Pula. Thank you. Chairman Fleming and Members of the
    Subcommittee, thank you for the opportunity to discuss Title
    VII of Public Law 110-229, and H.R. 1466, both dealing with
    immigration in the CNMI.
        During the past five years the CNMI has experienced ever
    increasing economic distress. Many businesses are ceasing
    operations. Many U.S. citizens, permanent residents, freely
    associates state citizens, as well as other aliens have
    department the CNMI. We must be mindful of these economic
    factors and challenges facing the CNMI.21Public Law 110-229 set
    in motion a plan for Federal administration and enforcement of
    immigration in the CNMI with the Department of Homeland
    Security having the lion's share of responsibility. On June 15
    of this year DHS submitted a final rule creating a CNMI
    transitional worker classification to the Office of OMB. We are
    hopeful that the issuance of this final rule will obviate many
    of the concerns of the CNMI community relating to employment
    for foreign workers during the next three years.
        Title VII calls on the Secretary of the Interior to provide
    technical assistance to help grow and diversify the CNMI
    economy and assist in recruiting, training and hiring in
    consultation with the Department of Labor and the Secretary of
    Commerce as well as the Governor of CNMI.
        On November 9 of last year, 2010, Assistant Secretary
    Babauta held a day-long Forum on Economic and Labor
    Development, also known as FELD, F-E-L-D, in pursuit of these
    goals. In the absence of dedicated resources, the Office of
    Insular Affairs committed up to $1 million in financial
    assistance to fulfill requirements of the law.
        After the FELD, a report was issued this past May outlining
    the steps for Federal CNMI and local private sector
    stakeholders to forge a plan for growing and diversifying the
    CNMI economy.
        Another crucial area of the CNMI economy is the labor
    market. Based on FELD discussions, the following areas would
    benefit from technical assistance: tourism, labor, renewable
    energy, agriculture and aquaculture, prevailing wage rate, and
    the visa waiver program. In fact, Assistant Secretary Babauta
    is currently in the CNMI, hopefully signing grants with the
    acting Governor there, that will give the CNMI about $700,000
    for on-the-job training and about $300,000 for economic
    revitalization.
        The Department of the Interior looks forward to working
    with DHS on a number of visa waiver issues, including examining
    whether to extend the exercise of parole authority to Guam and
    whether to add additional countries or geographic areas to the
    Guam and CNMI waiver program.
        Turning to H.R. 1466, the Congress delegates, the Secretary
    of the Interior, and the CNMI Senate have all expressed concern
    with regard to alien residents in the CNMI. H.R. 1466 will
    provide a forum of the CNMI only resident status to four
    categories of aliens who resided in the CNMI on November 28,
    2009, and the date of enactment of H.R. 1466. The four
    categories are:
        One, aliens born between 1974 and 1978 in Northern
    Marianas; two, aliens who were permanent residents under CNMI
    law; three, spouses and children of aliens in categories just
    noted; and four, immediate relatives of United States citizens.
        Four months ago the CNMI Senate issues its recommendation
    on approved immigration status which describes as a compromise
    position, the aliens would have a free associated type status
    whereby they could work and live in the CNMI or elsewhere in
    the United States as non-immigrants without United States
    citizenship and without voting rights.
        In April 2010, the Secretary of the Interior issued the
    report on the CNMI alien worker population. Included was a
    recommendation to grant long-term status to alien workers who
    have resided in the CNMI for a minimum of five years. The
    Department suggested five options that the Congress could
    consider for long-term status. H.R. 1466 would provide the
    long-term status and therefore H.R. 1466 is not inconsistent
    with Interior's report.
        Mr. Chairman, we appreciate your interest in these
    important issues affecting the Commonwealth of Northern
    Marianas and thank you for this opportunity.
        [The prepared statement of Mr. Pula follows:]

    Statement of Nikolao I. Pula, Jr., Director, Office of Insular Affairs,
      U.S. Department of the Interior, on Implementation in the Northern
    Mariana Islands of the Immigration Provisions of Title Vii of P.L. 110-
     229, and H.R. 1466, To Resolve the Status of Certain Persons Legally
      Residing in the Cnmi under the Immigration Laws of the United States

        Mr. Chairman and Members of the Subcommittee on Fisheries,
    Wildlife, Oceans and Insular Affairs, thank you for the opportunity to
    discuss title VII of Public Law 110-229, and H.R. 1466, both dealing
    with immigration in the Commonwealth of the Northern Mariana Islands
    (CNMI).
        During the past five years, the CNMI has experienced ever-
    increasing economic distress. Many businesses have ceased or are in the
    process of ceasing operations. Austerity measures undertaken by the
    CNMI government due to the ever-growing fiscal crisis (including 16-
    hours cut per 80-hour pay period, 13 unpaid holidays, 332 FTE
    reductions from the 2,100 government workforce) exacerbate the anxiety
    and uncertainty within the community. Many United States citizens,
    permanent residents, freely associated state citizens, as well as other
    aliens, have departed the CNMI in search of improved economic
    opportunity. It is expected that the population numbers to be reported
    by United States Bureau of Census in the coming weeks will show a
    significant reduction in the population of the CNMI, both United States
    citizens and aliens alike. Mindful of these economic factors and
    challenges, the Administration has made further strides in its
    implementation of Public Law 110-229.
    IMPLEMENTATION OF TITLE VII IMMIGRATION PROVISIONS IN THE CNMI
        Beginning in January 1978, the Commonwealth of the Northern Mariana
    Islands controlled immigration within its geographic area under
    agreement with the Federal government contained in the Covenant to
    Establish a Commonwealth of the Northern Mariana Islands in Political
    Union with the United States of America (Covenant). On May 8, 2008,
    title VII of Public Law 110-229 was signed into law, which set in
    motion a plan for Federal administration and enforcement of immigration
    in the CNMI with the Department of Homeland Security (DHS) having the
    lion's share of responsibility, and the Departments of Interior, Labor,
    State, Commerce and Justice sharing that responsibility.
        DHS established operations in the CNMI in advance of the November
    28, 2009 start of the transition period, establishing ports of entry
    and a USCIS Application Support Center and, as of that date has been on
    the ground in the CNMI administering Federal immigration laws there,
    including title VII of Public Law 110-229. As discussed in its
    testimony for this hearing, DHS has issued and has in effect three sets
    of regulations necessary for the administration of immigration under
    title VII (E-2 CNMI investors, Guam-CNMI Visa Waiver Program and
    conforming regulations). On June 15, 2011, DHS submitted a final rule
    creating a CNMI Transitional Worker Classification to the Office of
    Management and Budget for review.
        Implementation of the Transitional Worker interim final rule was
    enjoined as a result of litigation. While the issuance of the final
    rule has been of concern for the CNMI's business community and foreign
    workers alike who need to plan for their employment needs for the three
    plus years after November 27, 2011, proper formulation of the
    regulation is necessary. We are hopeful that the issuance of this final
    rule will obviate many of the concerns of the CNMI community relating
    to employment of foreign workers during the next three years.
    INTERIOR TECHNICAL ASSISTANCE
        Title VII of Public Law 110-229 calls on the Secretary of the
    Interior to provide technical assistance to the CNMI to help grow and
    diversify the CNMI economy and assist in recruiting, training and
    hiring U.S. citizens and nationals, lawful permanent residents and
    admissible citizens of the freely associated states.
        On November 9, 2010, Assistant Secretary Babauta held a day-long
    Forum on Economic and Labor Development (FELD) in the CNMI pursuant to
    Public Law 110-229's mandate that the Secretary of the Interior, in
    consultation with the Governor of the Commonwealth, the Secretary of
    Labor, and the Secretary of Commerce provide--
              technical assistance and other support to the
            Commonwealth to identify opportunities for, and encourage
            diversification and growth of, the economy of the Commonwealth;
              technical assistance, including assistance in
            recruiting, training, and hiring of workers, to assist
            employers in the Commonwealth in securing employees first from
            among United States citizens and nationals resident in the
            Commonwealth and if an adequate number of such workers are not
            available, from among legal permanent residents, including
            lawfully admissible citizens of the freely associated states;
            and
              technical assistance, including assistance to
            identify types of jobs needed, identify skills needed to
            fulfill such jobs, and assistance to Commonwealth educational
            entities to develop curricula for such job skills to include
            training teachers and students for such skills.
        The FELD provided an opportunity for Interior and interested
    stakeholders to begin a robust discussion on the types of technical
    assistance that would be appropriate and possibly available to the CNMI
    for its economy and workforce. Public Law 110-229 did not provide funds
    for this technical assistance. In the absence of dedicated resources,
    the Assistant Secretary Babauta has committed up to $1 million in
    financial assistance to fulfill requirements of the law. These funds of
    the Office of Insular Affairs (OIA) will be devoted to two main
    programs: assisting the CNMI with developing an economic revitalization
    program as suggested by the Governor of the CNMI, and enabling the CNMI
    government to work with local agencies and non-profit organizations to
    provide on-the-job training for eligible United States workers.
        As a result of the FELD, a report was issued this past May
    outlining the steps for the Federal, CNMI and local private sector
    stakeholders to forge a plan for growing and diversifying the CNMI
    economy. In selecting areas or sectors of the economy that would
    produce the greatest benefit, OIA reviewed recent statements of the
    CNMI government with regard to economic sectors it considers critical
    for its economic future. The Governor in his 2010 report to the
    legislature stated that ``tourism remains the CNMI's most important
    industry.'' Future growth in tourism would come, in part, from
    improving economic and financial conditions in industrial East Asia,
    which has traditionally been the CNMI's major tourist market. However,
    some immediate assistance to improve the sector's performance could
    prove helpful as I will explain later in my statement.
        Another critical area of the CNMI economy is the labor market.
    Title VII extends federal immigration laws and regulations, including
    entry visas for visitors and temporary alien workers. Since the law
    directly affects the CNMI's labor market, it is critical to understand
    how stable and predictable it would be in the near-term as well as the
    longer-term. CNMI businesses should be able to anticipate their labor
    needs for both United States citizens and temporary alien workers and
    the CNMI government needs to be able to project its revenue stream
    based on labor market and work force protections. Areas of the labor
    market identified by the FELD as critical factors include the absence
    of an unemployment insurance program, the lack of placement agencies,
    and the lack of adequate training programs, especially for vocational
    and specialized skills.
        Based on FELD discussions, the following areas would benefit from
    technical assistance:
        Tourism: The tourism industry would benefit from hospitality staff
    that is better trained. Lessons can be learned from Hawaii's
    hospitality industry. The CNMI can learn from the experiences of other
    destinations that attract repeat tourists and create new markets.
        Labor: The CNMI's labor market is unique in that it is still
    heavily dependent on foreign labor. Title VII recognizes the CNMI's
    special case and includes explicit provisions for determining the
    Commonwealth's labor needs through consultations among Federal
    agencies, the CNMI government and business community. For Interior's
    technical assistance program, the labor component must emphasize
    training and vocational skills.
        Renewable Energy: The CNMI will benefit greatly from an expanded
    use of renewable energy. Expansion of renewable energy sources and
    resources will reduce dependence on fossil fuels and create jobs.
    Separately, OIA has entered into a technical assistance agreement with
    the Department of Energy's National Renewable Energy Laboratory (NREL)
    to assess renewable energy potentials and uses in the territories. OIA
    is working closely with NREL and the territories to carry the project
    forward. FELD participants also believe that it will be important to
    improve not only the current water and power systems but also provide
    assistance to create and use infrastructure for alternative energies
    such as solar, wind, biomass, nuclear, geothermal and possibly others.
        Agriculture and aquaculture: Agriculture would produce fruits and
    vegetables for local markets and household use; aquaculture would
    produce valuable seafood. Using a technical assistance grant, the CNMI
    can examine agriculture and aquaculture practices elsewhere and
    replicate them or enhance existing programs. There would need to be an
    increase in technically trained personnel to operate farms and
    aquaculture projects: animal husbandry, entomology, plant cultivation
    and aquaculture technicians. This can be accomplished at all
    educational levels, starting in the public schools all the way up to
    the Northern Marianas College, according to the FELD. Curriculum and
    training facilities would also need to be developed and established.
        Prevailing Wage Rate. Another vital project identified by
    stakeholders at the FELD was the need for establishing a CNMI
    prevailing wage rate. A prevailing wage rate is required as part of the
    procedure for obtaining a foreign labor certification from United
    States Department of Labor prior to applying for an H nonimmigrant or
    employment-based permanent immigration status for an alien employee. At
    present, due to the lack of such a prevailing wage rate in the CNMI,
    the Department of Labor requires employers to compensate alien
    employees at the nearest market rate in which the occupational category
    is utilized. In the CNMI's case, this is usually the Guam prevailing
    wage rate which is much higher than the wage rate currently paid by
    most CNMI employers for any worker, alien or otherwise.
        Assistant Secretary Babauta has held several discussions with the
    CNMI Governor regarding how to best address the need for such a
    prevailing wage survey. The Assistant Secretary and the Governor agree
    that the survey is vital for the CNMI economy's recovery and growth.
    Both also agree that delay in completing the survey is detrimental to
    the business community as well as to the efficient implementation of
    Federal administration of immigration in the CNMI. Governor Fitial has
    submitted a request for funding such a project to the United States
    Department of Labor and is awaiting its determination. In the meantime,
    preparations are underway both in the government sector and in the
    private sector to undertake the survey with a targeted completion date
    of September of this year.
        Visa Waiver Program. The CNRA emphasizes the need to protect the
    CNMI economy and promote economic development. The CNMI has beautiful
    beaches and five-star hotel accommodations that are more than half
    empty. Given that tourism is now the mainstay of the CNMI economy,
    wherever possible both Federal and local officials must seek not only
    to avoid actions that may harm various sectors of the tourism market,
    but also to consider actions that promote increased tourism. Indeed,
    the CNRA mandates that economic considerations regarding visitors to
    the CNMI be considered in the development of the regulations for the
    Guam-CNMI visa waiver program. Chinese and Russian tourists accounted
    for 22 percent of CNMI tourists in 2008. For fiscal year 2009, Chinese
    and Russian tourists accounted for 9.2 percent of all arrivals. Since
    October 2009, the percentage of Chinese and Russian tourists have
    accounted for 12.4 percent of tourist arrivals. While this number may
    seem small, their contribution to the economy is significant;
    contributing approximately 20 percent of the total economic
    contribution from tourism.
        United States visa requirements now apply to foreign tourists to
    the CNMI. Title VII created a new Guam-CNMI Visa Waiver Program. For
    this new Guam-CNMI Visa Waiver Program, DHS issued an interim final
    rule that waives the visa requirements for eligible visitors from 12
    countries and geographic areas. At this time, China and Russia are not
    among the countries and geographic areas participating in the Guam-CNMI
    Visa Waiver Program.
        As DHS notes in its statement for this hearing, on October 21,
    2009, Secretary Napolitano announced her decision to exercise her
    discretionary authority to parole into the CNMI-only, on a case-by-case
    basis, otherwise admissible (except for the lack of a visa) Chinese and
    Russian nationals seeking to visit the CNMI. DHS announced this
    discretionary exercise of parole authority in recognition of the
    contribution of visitors from China and Russia to the CNMI economy. The
    Department of the Interior looks forward to working with DHS on these
    issues, including examining whether to extend the exercise of parole
    authority to Guam and whether to add additional countries or geographic
    areas to the Guam-CNMI Visa Waiver Program.
        While immigration transition in the CNMI has encountered a number
    of issues that require resolution, this has not deterred the Federal
    government from continuing to seek a smooth transition. We realize that
    change is difficult, but strongly believe that the Federal
    administration of immigration in the CNMI will bring about higher
    security for the Marianas archipelago as well as an improved
    environment for business and provide economic opportunities to the
    people of the CNMI.
    H.R. 1466--PATH TO CITIZENSHIP FOR CERTAIN ALIENS IN THE CNMI
        For fifty years, the Department of the Interior has been intimately
    involved with the Northern Mariana Islands, both as a district of the
    Trust Territory of the Pacific Islands and as a commonwealth of the
    United States. The Department, therefore, has a historical perspective
    that may help inform the Congress of effects that H.R. 1466 and other
    proposals may have on the Northern Mariana Islands and its residents.
    LONG-TERM STATUS FOR ALIENS IN THE CNMI
        The Congress, Delegate Gregorio Sablan, the Secretary of the
    Interior, and the Senate of the Seventeenth Northern Marianas
    Commonwealth Legislature have all expressed concern with regard to
    long-term alien residents in the CNMI, and the effect of their presence
    on the CNMI.
        H.R. 1466, the subject of this hearing, is one of the proposals. It
    would provide a form of CNMI-only resident status to four categories of
    aliens who resided in the CNMI on November 28, 2009 and the date of
    enactment of H.R. 1466. The four categories of aliens are:
              aliens born between January 1, 1974 and January 9,
            1978 in the Northern Mariana Islands District of the Trust
            Territory of the Pacific Islands (which later became the CNMI),
              aliens who were, on May 9, 2008, permanent residents
            of the CNMI under CNMI law,
              spouses and children of aliens in categories just
            noted, and
              immediate relatives (children, spouses and parents)
            of United States citizens.
        For the first five years, the resident status would be in the CNMI-
    only. Thereafter, if otherwise eligible, those individuals in the first
    three categories could apply to receive an immigrant visa or to adjust
    status to that of an alien lawfully admitted for permanent residence,
    which would allow for travel anywhere in the United States and its
    territories, and, if eligible, would place qualified individuals on a
    path to United States citizenship.
        As reported in the Saipan Tribune, CNMI Governor Benigno Fitial
    estimates that potentially 5,000 aliens in the CNMI may be classified
    as immediate relatives of United States citizens and could avail
    themselves of the opportunities provided in H.R. 1466, to become
    permanent residents and later citizens of the United States. Additional
    aliens would be added by the other categories of eligible aliens in
    H.R. 1466, and together these persons would represent approximately
    one-third of the aliens in the CNMI.
    CNMI Senate 2011 Recommendation Regarding Long-term CNMI Aliens
        In March 2011, the Senate of the Seventeenth Northern Marianas
    Commonwealth Legislature issued its Recommendation on Improved
    Immigration Status of Nonimmigrant Workers in the Commonwealth of the
    Northern Mariana Islands. The CNMI Senate includes what it describes
    ``as a compromise (recommendation) between the interests of
    nonimmigrant workers and indigenous residents of the Commonwealth'':
            All aliens residing legally in the Commonwealth of the Northern
            Mariana Islands for ten years on the date U.S. Public Law 110-
            229 became law, shall receive similar immigration status as
            that held by citizens of the freely associated states (FAS).
        The CNMI Senate is specific in its recommendation, calling for an
    FAS type status, whereby aliens who have been resident in the CNMI
    since May 8, 1998 would work and live in the CNMI or elsewhere in the
    United States as nonimmigrants, without United States citizenship and
    without voting rights.
    2010 Interior Recommendation Regarding Long-term CNMI Aliens
        In April 2010, the Secretary of the Interior issued the Report on
    the Alien Worker Population in the Commonwealth of the Northern Mariana
    Islands. Included was a recommendation to grant long-term status to
    alien workers who have resided in the CNMI for a minimum of five years:
            Consistent with the goals of comprehensive immigration reform,
            we recommend that the Congress consider permitting alien
            workers who have lawfully resided in the CNMI for a minimum
            period of five years to apply for long-term status under the
            immigration and nationality laws of the United States.
        The Department through the report suggested five options, among
    others, that could be considered for long-term status, including:
            (1)  alien workers could be conferred United States citizenship
            by Act of Congress;
            (2)  alien workers could be conferred permanent resident status
            leading to U.S. citizenship (per the normal provisions of the
            INA relating to naturalization), with the five-year minimum
            residence spent anywhere in the United States or its
            territories; or
            (3)  alien workers could be conferred permanent resident status
            leading to U.S. citizenship, with the five-year minimum
            residence spent in the CNMI.
        Additionally, under U.S. immigration law, special status is
    provided to aliens who are citizens of the freely associated states.
    Following this model,
            (4)  alien workers could be granted a nonimmigrant status like
            that negotiated for citizens of the freely associated states,
            whereby such persons may live and work in the United States and
            its territories; or
            (5)  alien workers could be granted a nonimmigrant status
            similar to that negotiated for citizens of the freely
            associated states, whereby such persons may live and work in
            the CNMI only.
    Department of the Interior Position
        The 2010 report of the Secretary of the Interior recommended a
    long-term status for foreign workers who lawfully resided in the CNMI
    for a minimum period of five years. At the time of the report, the
    Department's best estimate was that 20,654 legal aliens resided in the
    CNMI. H.R. 1466 is consistent with the Secretary's report in that it
    would give long-term status to more than 5,000 of these persons.
        Mr. Chairman, we appreciate your interest is these important
    immigration issues affecting the Commonwealth of the Northern Mariana
    Islands.
                                     ______

        Mr. Fleming. Thank you, Mr. Pula. I would now like to
    recognize the Ranking Member--I am sorry. Oh, OK, I am sorry. I
    would now like to introduce Ms. Aldan-Pierce and Ms. Doctor
    before they testify. Ms. Aldan-Pierce, you are now recognized
    for five minutes.

        STATEMENT OF MARIAN ALDAN-PIERCE, CHAIRPERSON, BOARD OF
                 DIRECTORS, MARIANAS VISITORS AUTHORITY

        Ms. Aldan-Pierce. Thank you, Chairman Fleming, Ranking
    Member Sablan. It is an honor to appear before this Committee
    today. I was asked to provide our views on Public Law 110-229,
    specifically on the Guam/CNMI waiver program.
        My name is Marian Aldan-Pierce, a lifetime resident of the
    CNMI, and I have worked in the tourism industry for over 35
    years. During my tenure in the industry, I have seen tourism in
    the CNMI grow from very humble beginnings to the peak in 1997,
    when we welcomed nearly 700,000 visitors to our islands. Our
    tourism program focused on Japan and the Japanese visitor. We
    marketed the CNMI in major Japanese cities. It is a cost-
    effective, closer alternative to other Pacific beach
    destinations. As a result, over three-fourths of our visitors
    were from Japan in the mid-90s. However, with the decline of
    the Japanese economy and other disasters, tourism in the CNMI
    have been on the downward spiral for many years, and we are now
    seeing what we hope to be the bottom of the tourism market.
        Last year, the CNMI had approximately 380,000 tourists, a
    little more than half the tourists that were welcomed at the
    peak of the market. We expect a further decline in arrivals
    with the recent action by air carriers, further reducing seat
    capacity from Japan and Korea to the CNMI during non-peak
    months.
        Mr. Chairman, Ranking Member Sablan, our remote islands in
    the Pacific with very few natural resources are now almost
    completely dependent on the tourism industry. Our government
    was forced to shut down last year for many days for financial
    reasons. Given these constraints as well as budgetary
    constrains here in Washington, it is clear that in order for
    the CNMI to survive into the future, for the government to
    sustain its payroll, for the people to have continued access to
    basic necessities of life, power, water and education, we
    cannot come to Washington with our hands out. We have to help
    ourselves. We must invigorate our tourism industry, our sole
    economic driver.
        I am here to request that DHS issue final rules for the
    Guam visa waiver program, for the Guam/CNMI visa waiver program
    that would allow continued access, visa-free from Chinese and
    Russian tourists in the CNMI and extend such access to Guam.
    These tourists are vital to the CNMI's economy and China and
    Russia represent tourism's future in the Marianas region.
        We are living in a very depressed economy. Buildings stand
    vacant and deteriorated in our major business district. Homes
    sit empty and abandoned in our villages. Private sector
    employees have suffered layoffs and reduced hours. Government
    employees have had their work hours reduced by 20 percent due
    to lack of funding, and the line for nutrition assistance from
    the Federal Government is long and only getting longer. The
    CNMI cannot continue to depend and hope for Federal dollars and
    expanding Federal assistance programs given the current
    budgetary climate in Washington.
        Reinvigorating our tourism industry in the CNMI would take
    new ideas and a new approach. The CNMI needs to work closely
    with our partners in Guam and market the Marianas region as a
    package destination to tourists. Even though our islands are
    located only 150 miles apart, we have two different sets of
    rules with respect to tourism. Unlike Guam, Russian and Chinese
    visitors are allowed entry into the CNMI under parole
    authority. Parole in the CNMI has operated flawlessly for
    nearly two years as DHS security protocols have successfully
    prevent the entry of objectionable visitors.
        Tourism, like any other business, needs regulatory
    certainty to attract investment. Since the enactment of the
    CNRA in 2008, DHS published an interim final rule and later
    extended parole authority for Russia and China to The CNMI.
    Unfortunately, despite the success of the parole program in the
    CNMI, DHS has not yet extended the same opportunity to Guam
    with respect to these two source countries.
        Mr. Chairman, Ranking Member Sablan and Members, we do not
    understand, and hope that we might learn more today why
    Congress and this Committee enacted legislation three years ago
    that combine visitor entry programs for our islands, the Guam/
    CNMI visa waiver program, and yet two unequal systems still
    exist today.
        To accomplish the objective of marketing in the region and
    expanding the tourism economy, the CNRA extended the time
    allowed for visitors under the Guam/CNMI visa waiver program to
    stay on the island from 15 to 45 days. Congress envisioned by
    doing so visitors will travel to multiple islands for a longer
    period to thereby maximize the economic impact and revenue in
    the region. We need regulatory certainty to attract investment
    to the region. We urge this Committee to impress upon DHS that
    the interim final rule needs to be finalized consistent with
    congressional intent of expanding tourism by ensuring that
    source markets such as China and Russia are included on the
    list as those markets are vital to the CNMI and the Marianas
    region for future tourism growth.
        Mr. Chairman, Ranking Member Sablan, and Members, while the
    CNMI's economy is in a precarious position today, we believe
    that with proper regulatory environment and cooperating with
    our neighbors on Guam we can revitalize our tourism economy and
    create much needed jobs and investment in the region, thereby
    reducing our reliance on Federal assistance.
        Thank you very much for giving me the opportunity to appear
    before you today. It has been a real honor and privilege.
        [The prepared statement of Ms. Aldan-Pierce follows:]

         Statement of Marian Aldan-Pierce, Chairperson of the Board of
                     Directors, Marianas Visitors Authority

    I. Overview
        Beginning in the 1980s, the economy of the Commonwealth of the
    Northern Mariana Islands (CNMI) was driven by two industries--apparel
    manufacturing and tourism. At the peak of tourism in 1997, when nearly
    730,000 visitors arrived, total government revenue was $248-million.
    The economy was vibrant.
        However, beginning in 2005 with the enactment of the World Trade
    Organization (WTO) agreement, the apparel industry began to relocate
    from the CNMI to locations where the cost of doing business was lower.
    Due to WTO impact and additional costs added through increases in
    minimum wage, by 2009, all 34 of the apparel manufacturing factories in
    the CNMI had closed, leaving the CNMI with only one industry leg left
    to stand on- tourism (APPENDIX A).
        The Consolidated Natural Resources Act (CNRA) of 2008, signed by
    President G.W. Bush on May 8, 2008, required that the CNMI federalize
    its immigration system beginning in November 2009. The CNRA provides
    for a Guam-CNMI Visa Waiver Program (VWP), whereby visitors from listed
    countries may make non-visa entry into the CNMI and Guam as tourists.
    In line with the CNRA's expressed mandate to expand tourism and
    economic development in the CNMI wherever possible, the CNMI strongly
    recommends that the Final Rules of the VWP be promulgated as soon as
    possible and that they contain a provision for continued visa waiver
    entry for citizens of the People's Republic of China (China) and the
    Russian Federation (Russia) either into the CNMI only or into the CNMI
    and Guam.
        This recommendation is based on the following four points:
              The CNMI economy is now completely dependent on
            tourism, and the CNRA requires that countries from which the
            CNMI has derived ``significant economic benefit'' by visitors
            be included in the list of VWP participating countries
              Including China and Russia under the VWP listed
            countries, versus including them under the sole parole
            authority of the Secretary of Homeland Security, will create
            stability and allow the CNMI to attract long term investment
            for these growing markets
              Since the parole process began, and prior to the CNRA
            under CNMI immigration measures, visitors from China and Russia
            have returned to their respective countries, an excellent
            performance record proving invalid DHS concerns of ``high
            nonimmigrant visa refusal rates''
              If allowable, a uniform VWP between the CNMI and Guam
            would allow development of multiple destination packages
            between the two island entities for visitors arriving by both
            air and sea
        As described further in this testimony, the economy of the CNMI is
    now solely reliant on tourism, a delicate industry easily buffeted by
    international and domestic challenges. These include visa access, the
    health of the economies in neighboring Asian countries, the convenience
    and price competitiveness of air service, and the ability to compete
    with nearby beach destinations. In recent years, the economy has taken
    a nosedive due to these challenges. The permanent inclusion of Russia
    and China in the VWP--or lack thereof--will largely determine if the
    CNMI economy can begin to climb its way to recovery, or whether it will
    be pushed over the edge.
    II. Sustaining a Diversified Tourism Economy
    A. A Brief History
        According to the U.S. Dept. of Commerce, Bureau of Economic
    Analysis BEA 10-24, real GDP of the CNMI decreased at an average annual
    rate of 4.2 percent from 2002 to 2007. The decrease in real GDP was
    primarily due to a decrease in the exports of garments, reflecting a
    contraction in the garment manufacturing industry and a decline in
    tourism. Since 2002, a number of economic shocks have contributed to a
    decline in tourism, including 9-11, the SARS epidemic and the 2005
    pullout of flagship carrier Japan Airlines, a loss of 35% (182,000) of
    annual air seats to the CNMI at the time and subsequent closure of an
    affiliate hotel--the second largest in the CNMI--and the CNMI's largest
    shopping mall. From 2002 to 2007, the population of the CNMI also
    decreased rapidly as foreign workers left the territory, and as a
    consequence, real GDP per capita increased at an average annual rate of
    0.5 percent.
        To help stabilize the industry and reduce reliance on any one
    source country, the CNMI has worked to diversify its source markets.
    Historically, visitors from Japan had comprised as high as 83% of all
    visitor arrivals. However, due to the CNMI's diversification efforts
    and concurrent increase in outbound travellers from those targeted
    countries, by FY 2010 only 50% were from Japan; 29% were from South
    Korea (Korea), 11% were from China, and 1% were from Russia. For FY
    2011 to date--through May 2011--the market share has diversified even
    further, with Japan comprising only 45%, Korea 32%, China 12% and
    Russia 2%.
        In more recent tourism trends, in FY 2010 visitors arrivals to the
    CNMI totaled only 386,186, only a little more than half of total
    visitor arrivals during the industry's peak in 1996 (APPENDIX B).
        From FY 2006-2010, hotel revenues each year dropped at an average
    of $2.9-million and the CNMI lost approximately $10.5-million annually
    in direct on-island expenditure. With a multiplier of 1.5, the CNMI
    business community lost $33.4 million in economic activity and $2-
    million in taxes annually. Additionally, it is estimated that 171
    public and 191 private sector jobs were displaced annually.
        Compared to FY 2006, direct impact during FY 2010 was down 16%
    ($274.4-million), while indirect impact also fell 16% ($726.2-million)
    (APPENDIX C).
        In addition to the overall growth of China and Russia arrivals, the
    economic impact of each visitor from these two destinations is
    significant. Russian visitors each spend 4.5 times as much as an
    average Asian visitor, while Chinese expenditures are comparable to
    Japanese and more than Korean visitors. Based on outbound growth
    projections of these countries and other factors, China and Russia are
    projected to increase in total arrivals and economic impact for the
    CNMI.
    B. Primary Source Market of Japan
        The CNMI has traditionally relied on Japanese tourists and its
    hotel industry was built largely with Japanese investment. This
    relationship sprung from both the proximity of Japan to this beach
    resort destination and from the historic political ties prior to World
    War II. Beginning in the late 1980s, the Commonwealth's visitor
    industry experienced a decade of phenomenal growth. Grand openings of
    new hotels, fueled by Japanese investment, were a regular occurrence
    during the decade. However, expectations of continued expansion proved
    unrealistic. The beginning of CNMI difficulties was the bursting of the
    Japanese ``bubble'' economy, followed by the Asian financial crisis
    beginning around 1997.
        Compared to the peak of tourism in FY1997 when Japan comprised 62%
    (450,190 visitors) of total visitor arrivals, so far in FY 2011 through
    May 2011, Japanese visitors comprise only 45% (102,578 visitors) of all
    visitors. The outbound Japanese travel market has suffered decline in
    the wake of the March 2011 earthquake and tsunami and continuing
    nuclear crisis, down 34 percent in May 2011 compared to May 2010
    (APPENDIX D).
        The biggest challenge the CNMI travel industry continues to face
    for Japan--and all markets--is air seat availability to the islands.
    Since the 2005 pullout of Japan Airlines and the loss of 35% of total
    air seats, the CNMI has yet to recover the same level of air seat
    availability. In December 2010 Delta Air Lines reduced one of its three
    daily direct flights from Tokyo/Narita to only three times weekly.
    Tokyo/Narita is the CNMI's largest source city. The loss of this
    service caused travel capability to slide from 66,430 seats annually
    from Toyko/Narita to only 37,856 seats. In April 2011, the suspended
    flight was formally terminated altogether. This further demonstrates
    the uncertainty of the tourism industry.
        In addition, since 2009 air service has been only seasonal from
    Osaka and Nagoya, the CNMI's largest markets outside Tokyo/Narita.
    Delta Air Lines suspended daily direct flights from Nagoya and only
    operates during peak periods during the year. This peak period
    traditionally runs from mid-December through March and from mid-July
    through September. Likewise, Asiana Airlines provides only seasonal
    daily flights during peak periods from Osaka. This low peak period
    represents 210 days per year during which the CNMI has lost the
    opportunity to benefit from 432 seats per day from these two source
    cities. This translates into lost visitor opportunities from Osaka and
    Nagoya of an estimated 90,720 visitors annually.
        From an income standpoint, with an estimated $851 in direct and
    $2,253 in indirect economic impact per Japanese visitor, the CNMI is
    losing $77.2-million and $204.4-million annually in direct and indirect
    economic opportunity, respectively, from its primary source market due
    to these lost air seats. With regards to impact on public and private
    employment, this results in an annual loss of an estimated 955 public
    and 1,067 private sector jobs, based on each public sector job being
    supported by 95 visitors and each private sector job being supported by
    85 visitors (APPENDIX E).
        The long-term forecast for outbound growth from this market is
    expected to grow 19.3% over the next five years, from 15.6-million in
    2011 to 18.6-million in 2016 (APPENDIX F).
    C. Primary Source Market of South Korea
        The Korean market to the CNMI had first started to grow in 1988
    when the Korean government lifted international travel restrictions on
    Korean nationals. This market was showing phenomenal growth until the
    Asian economic crisis hit in the mid-1990s, Korea was the hardest hit
    of the CNMI's source markets. Recognizing the CNMI's extreme
    vulnerability to the Japanese economy, the islands saw a unique
    opportunity and value in diversification of its tourism base. Korea was
    the first country to become the focus of more marketing and promotions
    by the Marianas Visitors Authority (MVA) as part of its diversification
    efforts.
        Since that time, the market share of Korea has grown considerably.
    During the peak of tourism in 1997, Korea comprised 23% of total
    visitor arrivals. In the 18 months before federalization of CNMI
    immigration in November 2009, Korea accounted for 26% of visitor
    arrivals. In the period since December 2010, Korea now comprises 31% of
    visitor arrivals (APPENDIX G). The outbound Korean travel market was
    also strongly affected by the March 2011 earthquake and tsunami and
    continuing nuclear crisis in Japan, with arrivals to the CNMI down 24
    percent in May 2011 compared to May 2010.
        Flight service from Korea has also fluctuated in recent years.
    Flights from Busan were cancelled in June 7, 2011. Asiana Airlines also
    recently decreased the number of daytime flights from Incheon/Seoul to
    the CNMI from four to two flights weekly, marking a loss of 18% of
    available air seats on a weekly basis. This decrease is expected to be
    reversed in mid-July, but it underscores the instability of air service
    from the CNMI's primary source countries.
        According to the Korea Tourism Organization, the long-term forecast
    for growth from this market is considerable, growing 33.3% from an
    estimated 13-million outbound travelers in 2011 to nearly 18-million
    travelers on 2016 (APPENDIX F).
    D. Secondary Source Market of China
        The CNMI first began receiving Chinese tourists in 1998. This
    initially began with private sector investments by several hotels and
    was later expanded to include investment by the Marianas Visitors
    Authority, regional tourism businesses and others. At the end of 2004,
    the CNMI also attained Approved Destination Status (ADS), which allowed
    it to actively market CNMI tourism in China.
        The China market has shown and continues to show significant growth
    in terms of market share. In the 18 months prior to the implementation
    of the US immigration provisions in November 2009, China accounted for
    7% of total arrivals. In the 18 months since federalization, market
    share from China increased to 11% of total arrivals and continues to
    grow.
        In terms of air service, today the CNMI has up to 4 direct charter
    flights weekly from two of the most affluent cities in China-Shanghai,
    and Guangzhou. In additional, regional air carrier Fly Guam currently
    flies direct air service from China's Special Administrative Region of
    Hong Kong to the CNMI and Guam three times a week, with plans to expand
    flights into China and other Asian ports.
        The two full years from the achievement of ADS status until the
    signing of the CNRA saw increasing growth from China. However, due to
    the enactment of the CNRA and the delay in the Final Rules, the CNMI
    has not been able to capitalize on the full potential of this market
    with regular scheduled flights and long-term investment.
        Allowing Chinese nationals into the CNMI as Visa Waivered tourists
    is doubly vital to our vulnerable economy because of changes in travel
    demand from other source countries into the CNMI. The Chinese tourists
    comprise an even greater proportion of the total number of visitor
    entries and make the CNMI's reliance in them even greater than reported
    in the MVA's previous Official Comments to the Interim Final Rules
    submitted to DHS on in February 2009. In our previous report based on
    1997 data, visitor arrivals from China totaled 2,478, less than 1% of
    total arrivals to the CNMI. Based on FY 2010 data, Chinese arrivals
    comprise 11 percent, and for FY 2011 through May 2011, they comprise
    12% (APPENDIX D).
        The China market also represents a comparable level of economic
    impact per visitor as the average visitor from the primary market of
    Japan and a higher economic impact than the average visitor from Korea
    (APPENDIX E). In FY 2010, Chinese visitors accounted for 14% of total
    CNMI tourism revenue, contributing $39.4-million in direct economic
    impact and $104-million in indirect economic impact to our economy
    (APPENDIX C).
        What is most promising about the China market is the potential for
    future growth, as the country remains Asia's largest source of outbound
    markets. According to the China National Travel Administration, this
    year's outbound travel projections stand at 65-million. However, by
    2016 the number of outbound tourists is expected to grow 72% to an
    estimated 112-million. As Chinese outbound travel is projected to
    greatly outpace outbound travel from Japan, Korea, and Russia, the
    market share of China in the CNMI tourism industry is expected to grow
    from 11% in FY 2011, to date, to 17% of total market share by 2016
    (APPENDIX H).
        Even the federal government has undertaken immigration
    modifications to capitalize on this opportunity and diversify further
    into the China market. In 2008, the United States entered into a
    Memorandum of Understanding with China to streamline visa processing.
    As noted at the December 2010 U.S.-China Joint Commission on Commerce
    and Trade, since the initiation of travel under the MOU in 2008, total
    passenger travel from China to the United States has increased by 23
    percent, a total export value of $5.5 billion (as of July 2010). China
    is the country's fastest growing market and by 2015 it is projected to
    become the 6th largest arrival market for the United States (up from
    16th before the MOU in 2008). As further reported in the commission
    fact sheet, ``China and the United States agreed to implement Phase 3
    of the Memorandum of Understanding (MOU) opening the market for the
    sale of packaged leisure travel from China to the United States to
    three additional provinces in China. (The United States will continue
    to press China to broaden the scope of access to include additional
    provinces.) China and the United States successfully established online
    systems to ensure the timely exchange of lists of Chinese travel
    agencies and U.S. tour operators authorized to conduct business under
    the MOU.'' The continued expansion of this MOU is an acknowledgement of
    the federal government that modified and streamlined visitor entry
    requirements for Chinese tourists are both feasible and desirable, an
    approach the CNMI has long practiced with success and now proposes to
    continue under the Guam-CNMI Visa Waiver Program.
    E. Secondary Source Market of Russia
        The CNMI first began marketing to Russian tourists in 1996.
    Following the enactment of the CNRA, the Russian market stumbled for
    several months due to several obstacles. The first was the exclusion of
    China and Russia in the Guam-CNMI VWP. Subsequently, when the Secretary
    of Homeland Security was empowered to provide parole to visitors from
    these countries, there was a short delay in the issuance of a
    diplomatic note to China and Russia. In addition, the CNMI lacked
    sufficient marketing funds to inform potential visitors in Russia of
    the parole option. Nonetheless, the country has finally rebounded and
    is recovering in raw numbers.
        In the 18 months prior to the implementation of the US immigration
    provisions in November 2009, Russia accounted for 1.8% of total
    arrivals. In the 18 months since federalization, market share from
    Russia has equaled 1.3% of total arrivals (APPENDIX G).
        Income derived from Russian tourists has become a far larger part
    of the total tourism income than in previous years. For example, a
    Russian visitor has an economic impact 4.5 greater than an average
    Asian visitor (APPENDIX E). From December 2009 through May 2011,
    visitor arrivals from Russia accounted for 7% of the total tourism
    revenue. In FY 2010, visitors from Russia contributed $18.7-million in
    direct economic impact and $49.4-million in indirect economic impact to
    the CNMI economy (APPENDIX C).
        Again, the foremost challenge of the market of Russian and other
    countries in the region is the availability of air service. Currently,
    there is no scheduled (regular) direct service available, and only a
    handful of charter flights have been flown since the markets opened.
    Most travelers through these countries must route through Seoul, Korea.
    In many cases, potential travelers are also not able track firm seats
    until immediately before departure when seats held by travel agents are
    released; this is not feasible for travel planning. However,
    negotiations are now underway for a connecting flight through Hong Kong
    via Fly Guam and a Russian airline partner. Considerations are being
    made to provide a two-destination package, Hong Kong and the CNMI, a
    move which would open up western Russia to the CNMI with much more
    convenience. One attractive component of the suggested package is that,
    at this time, visas are waived in both Hong Kong and the CNMI for
    Russians.
    III. A CNMI Economy without China and Russia
        The CNRA expressly states that its implementation shall develop
    tourism and economic development for the CNMI. In its Interim Final
    Rules analysis of January 2009, DHS grossly understated the negative
    travel demand into the CNMI if visitors from China and Russia were
    required to obtain a U.S. visa prior to entry. DHS had estimated the
    CNMI would lose only 5,017 and 194 visitors annually from China and
    Russia, respectively. Contrary to this, as the MVA gathered in
    discussion with travel partners serving those countries, requiring a
    U.S. visa for visitors from China and Russia would have a 95% negative
    impact on travel demand.
        With an economy already depressed by the pullout of apparel
    manufacturing and international obstacles to the recovery of the
    tourism industry, the CNMI is on the verge of economic collapse.
    Business buildings stand vacant and are deteriorating along our main
    thoroughfares. Homes sit abandoned in our villages. The list of
    friends, associates, and family members who have moved off-island to
    find jobs and a better life continues to grow. Private sectors
    employees have felt the sting of shortened hours and layoffs for years.
    Public sector employees funded locally have suffered a 20% reduction in
    work hours, and when payday does come, it is usually late.
        Without continued access to the China and Russian tourism markets,
    the economic future of the CNMI is bleak, if not dead. Using actual FY
    2011 arrivals-to-date as a basis, let us examine a CNMI economy without
    visitors from China and Russia.
        The total direct and indirect impact of tourism revenue for FY 2011
    through May 2011 is $450.8-million. Without visitors from China and
    Russia, that revenue would have dropped by 25% or $110.8-million
    (APPENDIX I).
        The total number of government jobs supported by tourism revenue
    this year is 2,180. Without visitors from China and Russia, 15.2% or
    331 of those jobs would have been lost.
        The total number of private sector jobs supported by tourism
    revenue this year is 2,437. Without visitors from China and Russia,
    15.2% or 370 of those jobs would have been lost.
        Clearly, to enact a Guam-CNMI Visa Waiver Program without allowing
    the CNMI access to visitors from China and Russia would have a
    detrimental and long-standing effect on the economy and livelihood of
    the people and would be contrary to the intent of the CNRA.
    V. Conclusion
        The CNMI economy direly needs continued access to visitors from
    China and Russia. As noted the Government Accountability Office report
    of June 23, 2011, ``American Samoa and Commonwealth of the Northern
    Mariana Islands: Employment, Earnings, and Status of Key Industries
    since Minimum Wage Increases Began,'' CNMI employment fell 13 percent
    from 2008 to 2009 and 35 percent from 2006 to 2009. The report also
    noted that in discussion groups, some tourism employers expressed
    concern that the primary difficulty was the CNMI tourism industry's
    decline.
        It is clear that the visitors from China and Russia are critical
    for reviving and sustaining the CNMI economy. The uncertainty about the
    Final Rules of the Guam-CNMI Visa Waiver Program has caused investors
    and tourism partners both local and international to hold off on
    current spending and on plans for future growth, as well. The sooner
    the Final Rules can be published, and the sooner they contain the
    certainty of continuity for our Russia and Chinese visitors, the sooner
    the intent of the CNRA to expand tourism and economic development can
    be accomplished.
        This intent may be accomplished by adding China and Russia to the
    list of allowable countries included under the VWP, or may it be
    accomplished by a separate ruling allowing their entry into only the
    CNMI, based on the CNMI's record to date of having visitors from China
    and Russia return to their respective countries and due to the limited
    amount of military assets and activity in the CNMI.
        The CNMI strongly recommends that the Final Rules be promulgated as
    soon as possible and that they contain a provision for continued visa
    waiver entry for Chinese and Russian citizens either into the CNMI only
    or into the CNMI and Guam.
                                     ______

                                     [GRAPHIC] [TIFF OMITTED] 67403.004

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.005

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.006

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.007

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.008

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.009

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.010

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.011

                                     .eps[GRAPHIC] [TIFF OMITTED] 67403.012

        .epsMr. Fleming. Thank you, Ms. Aldan-Pierce. Finally, we
    have Ms. Doctor. You are recognized for five minutes, ma'am.

     STATEMENT OF HAZEL DOCTOR, A RESIDENT OF THE COMMONWEALTH OF
                      THE NORTHERN MARIANA ISLANDS

        Ms. Doctor. Thank you and good morning. Chairman Fleming
    and Members of the Subcommittee, my name is Hazel Marie Doctor.
    I am a 19-year-old college sophomore, and I thank you for
    giving me the opportunity to testify today as a U.S. citizen,
    United States citizen who faces a terrible choice as a result
    of Public Law 110-229.
        As the law goes into effect, I am going to have to choose
    between my country, America, and my family, and that is a
    choice no one should have to face. It is my hope that you will
    hear my testimony and consider amending the law Congress passed
    three years ago without being fully aware of the impact it
    would have on U.S. citizens like myself.
        Let me first tell you a little bit about myself and my
    family. I was born in Saipan on January 21, 1992, and I have
    lived on this island my whole life. I have a younger sister
    named Jackie who is 11 years old and was born and raised on
    Saipan as well. As persons born in the Northern Marianas my
    sisters and I are citizens of the United States. Like you, we
    are Americans, and throughout our lives we have looked on
    America as our home.
        But my story really begins with my wonderful parents. My
    father Alex and my mother Tina are two of the most hard-working
    people I know. They have resided and worked in the Marianas for
    over 20 years after leaving the Philippines in search of a
    better life. They, too, call America their home, but unlike my
    sister and me our parents are not U.S. citizens. They are not
    even permanent residents. Instead, they are considered
    temporary workers even after all these years. They remain
    nationals of the Philippines because local Mariana's
    immigration and labor laws did not afford them the opportunity
    to become full members of this U.S. democratic society.
        My parents, along with thousands of other temporary
    workers, have contributed enormously to the economic
    development of the Commonwealth as nurses, business managers,
    construction workers, and in countless other jobs. Over time my
    parents, like so many other people, put their lives here. They
    put down roots and raised their children. They volunteered in
    the community and formed life-long friendships. In short, they
    became part of the fabric of Marianas society.
        At this point it isn't clear what will become of us, our
    parents, our relatives, our families. It is the intention of
    Public Law 110-229 to send all foreign workers home. That
    includes my parents. So our family will be faced with some
    difficult decisions. Should my sister and I go with our parents
    to the Philippines to keep our family together or stay behind
    in America, the only home we have ever known?
        But why should we have to choose between our family and our
    country? We do not want to be separated from our families and
    the one home we know and love. We want our family and all the
    families of the Northern Marianas to stay together. We also
    want to continue living here in the Northern Marianas to pursue
    our own goals and dreams. For me, my wish is to come back after
    college as a licensed psychiatrist and still see my parents and
    my sister living in their home in Saipan. It is also my wish to
    see other citizens who are the children of long-term guest
    workers return to the Commonwealth as physicians, accountants,
    and more to serve the community and the economy.
        We believe separating our families would be immoral. It
    would be a grave injustice and a critical democratic error, so
    we ask you to please protect our families. We ask you to
    support H.R. 1466 which would allow our families to remain in
    the Northern Marianas with the same rights they have under
    Mariana's immigration law, and we ask you to act now for the
    sake of our families and for our future.
        Thank you again for giving me the opportunity to speak
    before all of you.
        [The prepared statement of Ms. Doctor follows:]

         Statement of Hazel Marie Doctor on P.L. 110-229 and H.R. 1466

        My name is Hazel Marie Doctor. I am a nineteen-year-old college
    sophomore.
        Thank you for giving me the opportunity to testify today as a
    United States citizen who faces a terrible choice as the result of
    Public Law 110-229.
        As this law goes into effect, I am going to have to choose between
    my country--America, and my family.
        That is a choice no one should have to face.
        It is my hope that you will hear my testimony and consider amending
    the law Congress passed three years ago without being fully aware of
    the impact it would have on U.S. citizens like myself.
        Let me tell you a little bit about myself and my family. I was born
    on Saipan on January 21, 1992 and have lived on this island my whole
    life. I have a younger sister named Jackie who is eleven years old and
    was born and raised on Saipan as well. As persons born in the Northern
    Marianas, my sister and I are citizens of the United States. Like you,
    we are Americans. And throughout our lives, we have looked on America
    as our home.
        But my story really begins with my wonderful parents. My father,
    Alex, and my mother, Tina, are two of the most hard-working people I
    know. They have resided and worked in the Marianas for over twenty
    years after leaving the Philippines in search of a better life. They
    too call America their home. But unlike my sister and me, our parents
    are not U.S. citizens. They are not even permanent residents. Instead,
    they are considered ``temporary'' workers, even after all these years.
    They remain nationals of the Philippines because local Marianas
    immigration and labor laws did not afford them the opportunity to
    become full members of this U.S. democratic society.
        My parents, along with thousands of other ``temporary'' workers,
    have contributed enormously to the economic development of the
    Commonwealth as nurses, business managers, construction workers, and in
    countless other jobs. Over time my parents, like so many other people,
    built their lives here. They put down roots and raised their children.
    They volunteered in the community and formed lifelong friendships. In
    short, they became part of the fabric of Marianas society.
        At this point, however, it is unclear what will become of us, our
    parents, our relatives, our families. It is the intention of Public Law
    110-229 to send all foreign workers home. That includes my parents. So,
    our family will be faced with some difficult decisions. Should my
    sister and I go with our parents to the Philippines to keep the family
    together, or stay behind in the America, the only home we have ever
    known?
        But why should we have to choose between our family and our
    country? We do not want to be separated from our families and the one
    home we know and love. We want our family--and all families who call
    the Marianas home--to be able to stay together. We also want to
    continue living here in the Northern Marianas to pursue our own goals
    and dreams. For me, my wish is to come back after college to serve as a
    psychiatrist and still see my parents and my sister living in their
    home on Saipan. It is also my wish to see other U.S. citizens who are
    the children of long-term guest workers return to the Commonwealth as
    physicians, accountants, and more to serve the community.
        We believe separating our families would be immoral; it would be a
    grave injustice and a critical democratic error, so we ask you to
    protect our families. We ask you to support H.R. 1466, which will allow
    our families to remain in the Northern Marianas with the same rights
    they had under Marianas immigration law. And we ask that you act now
    for the sake of our families and our future.
        Thank you again for giving me the opportunity to speak before you.
                                     ______

        Mr. Fleming. Thank you, Ms. Doctor, for your testimony and
    thanks to all the witnesses for your very fruitful testimony
    this morning.
        At this point, we will begin Members' questions of the
    witnesses. To allow all Members to participate and to ensure we
    can hear from all the witnesses today, Member are limited to
    five minutes for their questions. However, if Members have
    additional questions we can have more than one round of
    questioning. I now recognize myself for five minutes.
        It is interesting a lot of comments that are made this
    morning relative to immigration are issues we are struggling
    with here in the continental United States. Maybe we can find
    some of our solutions through our discussions today.
        First of all, I would like to ask Ms. Ryan, the Committee
    is under the impression that certain security measures,
    electronic travel authorization, biometric entry/exit
    requirements are needed in Guam in order for China and Russia
    to be added to the Guam/CNMI waiver program. Is this still the
    case?
        Ms. Ryan. Thank you, Mr. Chairman.
        In implementing the CNRA, the immigration piece related to
    the inspections at the ports of entry in CNMI and also in Guam
    there is a presence of CBP officers, and they have access to
    the electronic data they need, and in fact there is preflight
    inspection that occurs, so we are able to inspect people and
    know about their history before they arrive, and they get a
    full screening both on CNMI and in Guam prior to their arriving
    and when they arrive, so we have access to the data that we
    need to do security screenings for inspections.
        Mr. Fleming. OK. So just to be sure, I want to be sure I am
    clear on this, so there are no further barriers with respect to
    electronic travel authorization. All of that is now fully in
    place and resolved?
        Ms. Ryan. Yes, sir.
        Mr. Fleming. Just as a matter of interest, you say that is
    done prior, I guess, to a flight into Guam and CNMI and then
    upon arrival. Where does that occur on the first leg?
        Ms. Ryan. When somebody seeks admission to the United
    States as a visitor, we actually get records from the airline
    industry before their arrival, and we run them for security
    screening measures. Then when somebody presents themselves for
    admission at a port of entry, we have to determine whether they
    are admissible to the U.S., and there are about 60 grounds of
    inadmissibility that an inspector is looking at to determine
    eligibility for arrival, so there is security screening both
    before and upon arrival for each applicant for admission.
        Mr. Fleming. Does this happen under the visa waiver
    program?
        Ms. Ryan. Yes, sir. Under visa waiver we still get
    information about applicants for admission prior to arrival.
    The electronic data is still submitted to CBP, and then it is
    also--under visa waiver you are still--we still examine you for
    whether you are admissible to the U.S. and so we use that
    process both in Guam and CNMI.
        In terms of whether it is ESTA, the computer system you
    referred to, that is an expensive system and we are not using
    that because of appropriations, but we have the layered
    security screening that is required in both CNMI and in Guam,
    both prior to arrival and then at the port itself.
        Mr. Fleming. So are there other security concerns for
    prohibiting the inclusion of Russians and Chinese?
        Ms. Ryan. The Secretary hasn't yet made a determination
    regarding the proposal about whether to extend visa waiver to
    Russians and Chinese nationals. Security issues are always at
    the top of her list of considerations, obviously, as well as
    other factors that she can consider which would include the
    economic conditions. So we have evaluated the--we are in the
    process and have asked for intelligence about any security
    threat that would be posed by Russian and Chinese nationals.
        Mr. Fleming. All right. So as I understand it, this is a
    two-step process. The first step is documentation only. That is
    prior to their leaving wherever their original site and then
    when they arrive to Guam or CNMI where they land, they are then
    screened both for documentation and biometrically at that
    point. But you are saying that still there are some unresolved
    issues with respect to the Chinese and the Russians, and that
    is a hang up because you have heard today--I know when I was on
    Guam the Japanese travel industry was a big part of the
    economy. That was the big honeymoon place back in those days,
    and I know that has flattened out, and there is a very big
    potential with Chinese in particular because of the sheer size
    of the nation.
        So what is our barrier there? What are we running into?
        Ms. Ryan. First of all, with respect to CNMI, as you know,
    there have been parole Russian and Chinese nationals, and so I
    would agree that has been a very good program that is run
    fairly well, both with respect to Chinese and Russian
    nationals. There are questions about who in that population
    might choose to travel and so an evaluation has to be carefully
    done about whether there would be any national security issues
    or public safety issues in permitting visa waiver for both Guam
    and CNMI, and the Secretary, when the first rule was
    promulgated, took into consideration the economic factors in
    granting parole, but she will make a decision, I hope soon,
    with all the facts available to her about whether to extend the
    visa waiver program to Chinese and Russian nationals into Guam
    and CNMI, and I know that is a great issue to both CNMI and
    Guam, and she is very aware of that, and she has been looking
    at the totality of the circumstances, the factors to consider.
        Mr. Fleming. My time is running out but just so I can be
    clear, the issue on the Chinese and the Russians is really the
    only thing left, the only piece left is Secretary of Homeland
    Security herself?
        Ms. Ryan. The authority is with the Secretary of the
    Homeland Security under the Immigration Nationality Act to make
    a determination on whether to permit visa waiver or travel
    extended to other countries as she did with the 12 that are in
    place right now.
        Mr. Fleming. And we are waiting for her decision at this
    point?
        Ms. Ryan. Yes, DHS is in the final stages of putting that
    rule together.
        Mr. Fleming. Right. OK, thank you. My time is up and I now
    yield to the Ranking Member Mr. Sablan.
        Mr. Sablan. Thank you very much, Mr. Chairman.
        Ms. Ryan, it looks like you are going to have a busy
    morning here. Let me start here.
        The one thing P.L. 110-229 requires is an interagency
    agreement describing Federal agency rules and responsibilities.
    I understand that in March of this year a memorandum of
    agreement was finalized between Federal agencies, and
    understanding the limitations of the time here, could you
    describe each agency's role and responsibility here?
        Ms. Ryan. Yes, sir. Very briefly, DHS has, of course,
    responsibility for the administration and enforcement of the
    immigration laws. Department of State has responsibility for
    issuing visas. Department of Justice has responsibility for the
    immigration courts. Department of the Interior administers the
    authorities relating to the technical assistance to the CNMI,
    and then the Department of Labor adjudicates the labor
    certificates and applications, and would make prevailing wage
    determinations.
        Mr. Sablan. And you have a way of coordinating all these
    efforts?
        Ms. Ryan. Yes, sir, we do.
        Mr. Sablan. The Federal Government way?
        Ms. Ryan. Yes, we are trying very hard to do that in a
    coordinated fashion.
        Mr. Sablan. That is the way. Could we get a copy of that
    agreement? Could the Subcommittee get a copy of that?
        Ms. Ryan. Yes, sir. We would be pleased to provide it.
        Mr. Sablan. Thank you. The CNMI only transitional worker
    regulations are currently under review by OMB. Why does it take
    so long to get the regs. to OMB?
        Ms. Ryan. The regulation process is a long one. I apologize
    to you for that, but it did take a long time because we were
    carefully considering all the various aspects of it. I am
    hopeful that it will be promulgated soon, and that will be
    another reg. that we will have out in the final status. But it
    was coordination within the government and trying to answer all
    the questions that were raised in the implementation phase to
    anticipate that.
        Mr. Sablan. Could we expect--I mean, we have seen the first
    one that was issued, you know, sometime back. Is the Department
    responsive to the extensive comments provided by our
    government, by the Guam government, by the CNMI workers? Could
    we say that you guys took a serious look at these things and
    reacted to it, responded to it, did something about it because
    you had to?
        Ms. Ryan. Ranking Member Sablan, I can't really talk about
    the final rule until it is actually promulgated, but yes, we
    absolutely took the comments of our stakeholders quite
    seriously in developing the final rule.
        Mr. Sablan. And we expect the regs. out within the 90-days?
        Ms. Ryan. Yes, sir.
        Mr. Sablan. We don't really think it is going to back to
    the Department, is it, to OMB?
        Ms. Ryan. I hope we can get it out as quickly as possible,
    but I cannot make any representations on the speed at which it
    will come from OMB, but it is at OMB which is a very good sign.
        Mr. Sablan. By the time everything went really well, hunky-
    dory, maybe at the latest it would be September, no?
        Ms. Ryan. Hopeful, that is absolutely the case.
        Mr. Sablan. And your Department is ready to address, to
    prepare for the volume of applications that will have to be
    processed before November 27?
        Ms. Ryan. Yes, sir. We have actually been anticipating that
    there would be a large volume, and we have been coming up with
    plans in order to address that.
        Mr. Sablan. Yes, your Hawaii, Guam and CNMI offices are
    prepared for this?
        Ms. Ryan. Yes, and our California Service Center.
        Mr. Sablan. All right. And do you have any plans to do
    outreach in the Commonwealth?
        Ms. Ryan. Absolutely, we will do outreach. We will have
    information on the website as well as in face-to-face meetings
    and we will try to make sure that everybody is aware of the way
    that the rule will operate.
        Mr. Sablan. But because this is the Federal Government we
    never know what can happen, so in case it doesn't--the
    regulations don't come out by November 27, is the Secretary
    prepared to use her parole authority to allow CNMI umbrella
    permit holders to remain lawfully in the Commonwealth until the
    regulations are issued and the applications are adjudicated?
        Ms. Ryan. I appreciate how important this is and your
    desire to have reassurance on contingency plans, and yes, we
    have contingency plans. We hope not to have to employ them. We
    hope to have the rule out and employers and petitioners well
    aware of how to take advantage of the new program.
        Mr. Sablan. I will be back with you.
        Good morning, Hazel. Hazel, good morning.
        Ms. Doctor. Good morning.
        Mr. Sablan. You are not going to fall asleep there on us,
    are you?
        Ms. Doctor. Oh, no, I am fine here.
        Mr. Sablan. Isn't this wonderful having you 8,000 miles
    away and testifying before Congress? Thank you, Chairman
    Fleming. Chairman Fleming allowed the use of the video and we
    really appreciate it.
        But Hazel, you are not a boastful person. I have known you
    practically all of your life. You used to chill out at my house
    because you were classmates with my daughter, and you graduated
    valedictorian of Mount Carmel High School. I know you have been
    offered a $60,000 scholarship to come to the university in the
    States. You said you plan to become a psychiatrist, return to
    the Northern Marianas to use your skill. We need smart, young
    people with professional training to build our economy, to make
    the Commonwealth a prosperous and a beautiful community to live
    in.
        Let me ask, what if your parents are forced to leave? Are
    we going to lose you?
        Ms. Doctor. Most definitely. It would definitely be
    heartbreaking for me to come back to the islands knowing that
    my foundation, the people that I have grown up with are gone.
    It would be very sad to see the same people that I grew up with
    whose parents are also non-resident workers, to, you know,
    probably come back with that same feeling or maybe not at all,
    and these are the types of people who do have the intention of
    coming back as engineers, as accountants, as business managers
    and other great and very necessary jobs that are critical and
    important for the economy, economic development.
        Mr. Sablan. I know my time is up. Just one thing. We have
    heard testimony described as families being held by H.R. 1466
    are unemployed, unemployable, and without means of support.
    Hazel, 20 years, your parents have been there for 20 years. Can
    you tell us about your parents? What do they do for a living?
    How long have they worked in the Northern Marianas? How did
    they get to private school?
        Ms. Doctor. Well, they are both accountants and they have
    been working here for almost two decades, and they managed to
    get me through a private school, both my sister and I, through
    a lot of savings and some great financial aid. They have been
    working very hard and I can see that parents with children just
    like me are doing the same thing. They, too, have a low income
    threshold and try to make a great living with whatever they can
    to send their children to a better way of life here on the
    islands, and I really hope it continues that way.
        Mr. Sablan. Thank you, Mr. Chairman. My time is up.
        Mr. Fleming. I thank the gentleman, the Ranking Member.
    Now, Mr. Young, sir, you have five minutes.
        Mr. Young. Thank you, Mr. Chairman. I don't have questions
    now but I will submit questions to Ms. Ryan, and my interest in
    this is very clear. The delegate came to me and said this is a
    problem in my district, and the lady from Guam mentioned the
    same thing, and I want to believe that if it is their problem I
    will help them solve it. I believe this very strongly. I always
    have and always will.
        I just have one question for the sponsor. We are talking
    about 4,000 people, correct?
        Mr. Sablan. Yes, sir. GAO just said that an Interior's
    report said that.
        Mr. Young. And there is no chance of that increasing if we
    pass this law?
        Mr. Sablan. No, sir, because on May 28th you have to have
    been a resident on May 28, 2008, and on the day of the
    enactment of this, so there are two ends of law. No, sir, it
    doesn't have any chance of increasing.
        Mr. Young. Now, is there any restriction of these people if
    they don't meet the income threshold? I understand they have to
    be making a certain amount of money but they are under minimum
    wage, I believe, some of them, so that is a problem. Can this
    law that you are proposing overcome that?
        Mr. Sablan. Presently, sir, Chairman Young, the reason I
    am--personally many of these people, the Marianas' citizens,
    have for many purposes of law met the Immigration Nationality
    Act requirements. Some of them are walking around with one more
    additional requirement they need to fill and it is they need to
    fill a financial sponsor requirement, and that is holding back
    some of these people, holding back from converting the status.
        Now, if 1466 does not help these people, those people who
    have for purposes of the law met all the other requirements
    will on November 28th be deportable.
        Mr. Young. Will be deportable, but can one of the
    departments, the Homelands or Interior, stop that deportation?
        Mr. Sablan. I think they do. They may disagree with me but
    I think the Secretary of Homeland Security has the authority to
    issue a parole in place for these people except the parole in
    places are discretionary and they are only for two years at a
    time, or annual, they are annual. They are for one year at a
    time. That is free. That has no income threshold requirement,
    but it is the same thing that they go through every year now,
    it is one year at a time, and two years from now we could have
    a different Secretary of Homeland Security and they would just
    change their mind about the whole thing and then we will be in
    the same place we are at today.
        Mr. Young. That is why it is important to pass this
    legislation.
        Mr. Sablan. And urgent. Promptly yes.
        Mr. Young. Urgently. Last may I ask you, the opposition to
    this would be based upon what?
        Mr. Sablan. I have absolutely no idea.
        Mr. Young. OK, the reason I ask that, and by the way, young
    lady, you do a great job. You are going to go a long way in
    this life of yours. You speak very well. You are well educated,
    a classic example, a classic example of parents putting their
    money into the future, and it would be wrong to have you
    separated from your parents.
        So what we have to do is look at the solution and get it
    passed. Unfortunately, we have to remember I think we would
    have luck here. You have a sink hole on the other side, like it
    is on I-95 right now, or 495. I don't know whether you heard
    the news today, the highway sunk.
        Mr. Sablan. Oh, yes.
        Mr. Young. Well, that is the Senate side.
        [Laughter.]
        Mr. Young. So we have to fight that battle but let us see
    if we can do it. I want to congratulate the delegates for their
    work, and the Members that are here, and let us go ahead and
    get this legislation.
        Thank you, Mr. Chairman. I yield back the balance of my
    time.
        Mr. Fleming. Thank you. The gentleman from Alaska yields
    back.
        Next, Mrs. Bordallo, the gentlelady from Guam.
        Mrs. Bordallo. Thank you very much, Mr. Chairman, and I
    want to thank Congressman Young for his kind words, and I know
    he will help us as well as yourself.
        Before I begin my questioning I would like to recognize a
    few people in the audience. We have our Speaker, the Guam
    Legislature who is here. We have Joann Camacho, the former
    first lady of Guam and general Manager of the Guam Business
    Bureau, and I would also like to note the presence of Senator
    Tina Muna Barnes who is with the 31st Guam Legislature and she
    chairs the Committee on Municipal Affairs, Tourism, Housing,
    and Recreation. They are tireless advocates for Guam's tourism
    industry, and I do appreciate it, and I want to say a warm
    ``Hafa Adai'' to everyone in the audience today, my friends
    from CNMI and Guam.
        If first want to ask Governor Calvo, thank you for your
    testimony, Governor. Can you give the Committee a sense of the
    economic importance of extending the Guam CNMI visa waiver
    program to China and Russia? And how important is this to
    Guam's future economic prosperity?
        And further, some have suggested you can't have a military
    build up and an expansion of a visa waiver. Now, I believe that
    is a false choice for the people of Guam, and as such, can you
    comment on where local commanders on Guam, in particular,
    Admiral Buchan, may be on the issue of extending waiver to
    Russia and China in Guam? And if there were to be security
    concerns, then I would expect those concerns to be raised by
    the local commanders first. Can you comment on that?
        Governor Calvo. Sure, on two points. On the economic
    importance to Guam, again we have a 13.6 percent unemployment
    rate here. 2009, we were at 9 percent. Within that two-year
    period we have created 1,000 new jobs. The big question, of
    course, how the heck did that happen? How did you get more jobs
    created but your unemployment growing? And that is why it was
    so important to bring up the FAS question, because we have had
    87 percent growth in five years of FAS immigrants from 2002 to
    2007, so we have a fast growing population. Right now because
    of our military industry and our tourism service industry,
    those are the two pillars.
        The military side right now, we are not too sure, again
    things are happening in the Senate with the Marine buildup,
    which I am advocate for, but when we had 900,000 tourists
    coming from Japan, our biggest market, out of a total of 15
    million outbound market out of Japan, when that tsunami hit we
    experienced a 30 percent drop off on the Japanese market, and
    again it has had a significant impact and has thrown us back
    into a recession.
        We look at China, and I go back to Japan, 15 million
    outbound tourists, China, 55 million, Russia, 13 million. The
    average American tourist spends around 100 to 150 dollars a
    day. The Japanese tourist spends about 300 some dollars a day.
    The Chinese tourists spends $600 a day and the Russians spend
    $900 a day. That is just how they spend.
        The importance to Guam for that access and how it can help
    both Guam and Northern Marianas in terms of our economic well
    being has a positive effect to the United States. You know, one
    of the things I am concerned about, I have been talking with
    the State Department, I am going from here to Utah for the
    Governors Conference, and they have a whole bunch of Chinese
    Governors there meeting with American Governors to try to get--
    how we can get this bilateral trade to get a bunch of Uwan back
    to the United States, so we are trying to build this--even this
    deficit, but again, the most easiest way to do it is to get
    Chinese tourists who are just four hours a way to Guam.
        Security issue, I for the life of me can't understand it.
    The largest group of college students in the United States
    today coming in from a foreign country, they come from Mainland
    China. They are coming to our universities. I have talked to
    our military commanders back there in Guam. They are not
    concerned about it. I have talked to Undersecretary Work. They
    don't have an issue with it. I am not too sure. As far as I am
    concerned when I am going to Washington, D.C. we have been
    trying to find out where the potential areas of the concern. I
    am not seeing it from the Defense Department so I assume it is
    coming from Homeland Security.
        Mrs. Bordallo. Thank you. Thank you very much, Governor.
    You did answer the question, and I am taking up a little of
    what the Chairman had mentioned to Secretary Ryan. You
    specifically said security is not an issue. Did I hear that
    right?
        Ms. Ryan. I said, Congresswoman, that we take into account,
    or the Secretary, through the interagency consultation with the
    Department of the Interior, Department of Defense, and
    Department of State would factor in whether there was a
    security risk in extending VWP for Chinese and Russian
    nationals, and she has not made her final decision yet, but
    that would be a factor as well as the economic opportunity that
    such travel might bring.
        Mrs. Bordallo. Maybe I can understand. I thought I
    understood that the decision now is solely up to the Secretary.
    You have done your work.
        Ms. Ryan. The Secretary of Homeland Security has the
    authority under the INA. She is going to make a decision after
    we had consulted with those departments that I have talked to
    you about.
        Mrs. Bordallo. I did meet the Secretary just recently
    during a caucus meeting, and she told me she was going to get
    back to me, and I spoke to her about the urgency of this, and I
    want to ask a couple of pointed questions here if you would.
        The Department of Homeland Security, how much longer do you
    have to study what needs to be done to issue the final rule? We
    have been on hold for too long, and I just want an idea of when
    you think the decision from the Secretary will take place. Can
    you give us any time frame?
        Ms. Ryan. As someone who has worked as an Executive Branch
    lawyer, I hate to give a deadline that I can't promise and I
    don't control when she is going to take decisions, so I would
    say I fully appreciate how important this is to Guam and to
    CNMI, and I will make sure I do everything possible to urge a
    decision, but I can't give you a deadline, but I will take back
    exactly what you have said to her, and make sure that her
    counselors are aware of how important this issue is to you and
    to the Committee.
        Mrs. Bordallo. We are simply asking for parole authority.
    That is what we are asking for. Just as the Northern Marianas
    gets at this point, and I just don't understand. I thought the
    decision was going to be made before the end of last year, and
    we are still holding onto this, and it is very frustrating to
    say the least, and I was promised that a decision would be made
    very soon.
        So, you don't have an answer to any of these questions. In
    other words, security is not entirely out?
        Ms. Ryan. I would have to say representing the Department
    of Homeland Security that looking at the national security
    issues with respect to immigration is always--it is fundamental
    to our job, so that is part of the calculation she would make
    in deciding whether to extend parole to Guam or to extend VWP
    to Chinese and Russian nationals in Guam and CNMI. It is always
    going to be a factor in any calculation she makes as well as
    the economic issues and other factors that are available to
    her.
        Mrs. Bordallo. And for the record, Secretary, Admiral
    Buchan, who spoke on behalf of DOD, he is our local admiral, he
    stated very clearly no concerns on their part, so I don't
    understand how that security just keeps coming up over and
    over.
        Ms. Ryan. Thank you very much for that information. I
    wasn't aware of his view but I will let her know that as well.
    We have been talking to DOD here in Washington, but I am very
    pleased to take that information back to her.
        Mrs. Bordallo. Thank you very much and I yield back, Mr.
    Chair.
        Mr. Fleming. I thank the gentlelady. Next the Chair
    recognizes the gentlelady from Hawaii, Ms. Hanabusa.
        Ms. Hanabusa. Thank you very much, Mr. Chair.
        Secretary Ryan, have you had the opportunity to read the
    testimony of the Governor of CNMI?
        Ms. Ryan. Are you talking about today's testimony?
        Ms. Hanabusa. Right.
        Ms. Ryan. No, I have not read it in full. I have only been
    able to listen to his oral testimony today, but I will do that
    when I get back to my office.
        Ms. Hanabusa. Well, let us just go through what you heard
    in terms of his testimony. He has raised an opposition to this
    particular measure, about 11 different concerns. Do you know if
    the rule that you are proposing to implement, I think, by mid-
    September was your estimate, would be addressing his concerns
    that you heard him testify to?
        Ms. Ryan. I understood the Governor to be talking about the
    people that aren't currently covered in the transition rule,
    and stating an opposition to that, and then I heard my
    colleague from GAO suggest the number that he had raised might
    be somewhat inflated.
        My understanding with the investor rule is that we will (a)
    be ready for it in advance of the November 28th deadline; and
    that we are fully engaged in having it be operationalized. I
    don't think it would cover the people covered in Mr. Sablan's
    bill as I understand it. They are a different category of
    people.
        So, I think what we have committed to is looking at parole
    authority for certain groups that were not covered in the CNRA,
    and also working with the Committee on the legislation itself
    as it moves forward.
        Ms. Hanabusa. OK, that is an important point because I want
    it to be clear in my mind that you are not talking about the
    same group that Mr. Sablan is speaking to. He is talking about
    4,000 very specific individuals. So the rule that you have
    testified to that will take effect in mid-September will not
    cover those 4,000, so Ms. Doctor's, for example, her parents
    would fall through the cracks.
        Ms. Ryan. The rule that will come out relating to the
    worker, the worker rule, will permit petitioners to file for
    persons there, but as I understand it the categories of people
    that Mr. Sablan's bill is designed to address would not
    necessarily be covered by that. There may be some crossover in
    some cases. I don't want to mislead the Committee, but my
    understanding is he is trying to help four specific groups of
    people, that maybe three to four thousand persons in size that
    would not automatically be covered by our rule that will come
    out before November 28th, hopefully.
        Ms. Hanabusa. So assuming that Ms. Doctor's parents fall
    into the category that is not covered, what then will happen to
    them come November?
        Ms. Ryan. Well, as I understand from Ms. Doctor, and I
    don't have access to her family's records, but as I understand
    her parents right now don't have the ability post-November 28th
    to remain lawfully in CNMI absent either parole or some other
    legislative action. But again, I don't have specific access,
    but that is how I understand the situation to be in Ms.
    Doctor's case.
        Ms. Hanabusa. So in that situation the only way that we
    would be able to ensure that Ms. Doctor will continue her
    education in the United States and return to CNMI as a
    psychiatrist would be if her parents are somehow covered under
    1466?
        Ms. Ryan. As I understand it, there is, I think, three
    options. If the bill passes, that presumably her parents would
    be covered, there would be parole, the potential for parole,
    and the third option would be if her parents' employers
    petitioned for her and got her employment status based on their
    working relationship with her, so I think there are three
    avenues that I think are available, depending on the actual
    circumstances.
        Ms. Hanabusa. And Ms. Ryan, given the fact that, and this
    is no insult but it has taken so long and we are talking about
    November of this year, is it that the bill is probably the most
    fail/safe way to address this specific group of 4,000?
        Ms. Ryan. On the investor rule, I would say that while it
    has taken a long time part of the reason that that is the case
    was that we were enjoined from implementing it by Federal
    litigation, so that has been a part of the delays that I should
    say.
        I think, given the timing here, we are very aware that we
    need to get our rule out so that employers have opportunities
    to make those filings. I am not sure about the calendar of the
    Congress and which one will happen first. I suspect our rule
    will get out before there would be an opportunity----
        Ms. Hanabusa. We already know that your rule will not
    address this group of people.
        Ms. Ryan. It would address it potentially, as I said, some
    of them.
        Ms. Hanabusa. Right.
        Ms. Ryan. Because if they had an employer who could file a
    petition on their behalf, but as I understand it from the
    description of the Ranking Member, it would not cover all of
    them.
        Ms. Hanabusa. Thank you very much. Thank you, Mr. Chair.
        Mr. Fleming. I thank the gentlelady. Next recognized is Mr.
    Faleomavaega. Thank you, sir. He is passing on questions. Thank
    you, sir.
        Mr. Faleomavaega. Thank you, Mr. Chairman, and I do want to
    commend you for your leadership and initiative in bringing
    these two pieces of legislation for consideration, and I also
    thank your Ranking Member for his services and leadership in
    working in this Subcommittee.
        I do want to offer my personal welcomes to our
    distinguished guests on the panel here as witnesses: my good
    friend Governor Fitial and also Governor Calvo. Dr. Gootnick,
    always good to see you. Secretary Ryan and Mr. Nik Pula with
    the Office of Insular Affairs, and Ms. Pierce, we welcome you
    for your testimony that has been born here.
        I have so many questions I don't know where to begin with,
    but am I correct, Mr. Chairman, that we ought to focus
    primarily on Mr. Sablan's bill, H.R. 1466?
        Mr. Fleming. That is correct, but we are going to have a
    second round of questions.
        Mr. Faleomavaega. I understand that. So I do want to thank
    Governor Fitial for his testimony, and very substantive I might
    say, and Governor Calvo, I am going to reserve my questions for
    you in the next panel dealing with our situation in Guam.
        I thought your comments, Governor Fitial, were quite
    substantive in the fact that you have twice made testimonies
    before this Subcommittee on the same issues--failure to grant
    visa waivers, failure to depart illegal aliens, failure to
    monitor exits of tourists, failure to provide Congress with
    useful reports.
        I understand there is some little disagreement with you and
    my good friend Mr. Sablan and H.R. 1466. Do you think there may
    be a possibility that we can work out some basis of agreement
    in terms of the substance of the proposed bill, and with what
    Mr. Sablan has provided in H.R. 1466?
        Governor Fitial. Absolutely. Let me just make it very clear
    that we are talking about four classifications of, you know,
    U.S. citizens, and I have no qualms over the first three. I am
    only concerned about the fourth category which would grant, you
    know, citizenship to parents of U.S. citizen children.
        Mr. Faleomavaega. So, Governor, your concerns have been
    well taken, so we can work with Mr. Sablan in a way that we can
    cure some of the concerns that you are raising.
        Governor Fitial. Right, and the concern of, you know, the
    young lady here, her parents--as long as they have permits,
    working permits, they have no problem. I want to make that very
    clear. They will not be deported as long as they have valid
    working permits.
        Mr. Faleomavaega. Well, you know we have a similar
    situation here in our country where we have parents who were
    not here legally but children were born here as U.S. citizens,
    and questions of deportation come into play and a very, very
    serious problem that we are faced with here in our country, and
    I realized the sensitivities involved here, and I sincerely
    hope that the concerns that you have raised here, Governor,
    will be such that we can work with my good friend Mr. Sablan
    and----
        Mr. Sablan. Would the gentleman----
        Mr. Faleomavaega. I would gladly yield but I have real----
        Mr. Sablan. Just one comment.
        Mr. Faleomavaega. Please
        Mr. Sablan. Because I don't think it in the Commonwealth's
    place to now say that the parents of individuals like Hazel
    Doctor will not be deported because it is Ms. Ryan's department
    that controls immigration, no longer Governor Fitial, and that
    is the law. So we can't continue to be delusional that they
    will be fine when the Commonwealth no longer controls the
    borders. That is all.
        Mr. Faleomavaega. I thank the gentleman, and I am going to
    ask Secretary Ryan----
        Governor Fitial. If I may.
        Mr. Faleomavaega. Please, Governor.
        Governor Fitial. That is why I am proposing, you know, an
    H-5 visa that would accommodate workers instead of just
    families, OK. So if we can accommodate the parents of that
    young lady, you know, to continue working, then that is my
    proposal. They will never be deported.
        Mr. Faleomavaega. OK, Governor, I realize that my time is
    short but I will definitely raise that issue with my good
    friend Sablan.
        Secretary Ryan, it is my understanding the Department of
    Defense is with the visa waiver program, the Department of the
    Interior, but the State Department raises objections, and at
    this point in time Homeland Security has not issued. Is it
    because of the State Department's objections or what seems to
    be the problem?
        We keep talking about security issues. We have 680,000
    foreign students attending American colleges and universities
    and the Chinese are number one, about 100,000 of those students
    are from China. And so where are the security concerns that
    Homeland Security might have on the visa waiver program for the
    Russians and the Chinese to come?
        Ms. Ryan. Well, respectfully, sir, I would say that the
    students that come here from all over the world are screened
    and actually obtain a visa, and so they are interviewed to make
    sure that they don't pose a threat to public safety or national
    security. So, again, it is the totality of the circumstances
    that the Secretary looks at. I would be recalcitrant in my job
    if I didn't identify national security or public safety as a
    critical factor in any determination on making categorical
    parole decisions or visa waiver.
        But I am not here to say which agencies are coming out
    which way, but I can assure you that we are working in
    consultation with those agencies to get a decision from the
    Secretary.--
        Mr. Faleomavaega. Well, we have been saying that for the
    past three years, Ms. Ryan, and we still haven't solved some of
    these problems.
        I am sorry. I yield back. My time is up.
        Ms. Ryan. May I make one more point about Ms. Doctor's
    family which I think is important to the discussion?
        If the bill were to pass, then her family would have, of
    course, access to lawful permanent residence first and then
    citizenship. The other opportunity would be if her parents were
    able to have their employer petition for them. That, of course,
    would be just a transitional or it would be a temporary
    situation because it is a transitional worker, and that non-
    immigrant status would sense that, so they would not have any
    permanent ability to remain in CNMI, and I guess I wanted to
    make that clear to the Committee and to understand the
    differences in the options that I offered.
        Mr. Fleming. Well, we have completed a round of questioning
    and I do thank the witnesses for your testimony and your
    willingness to answer questions very straightforwardly. I think
    that the panel here would like to have another round of
    questions if you are up to the task, so therefore I am going to
    go ahead and recognize myself for five minutes.
        I want to pick up kind of where I left off, and this
    question is for Governor Calvo. We really drilled down, I did
    and others on the panel, on the issue of security risk,
    particularly on Guam because that is an area that seems to be
    confusing that we don't have parole authority on Guam for the
    same visitors that we have on Saipan, for instance. So, I want
    to ask you, sir, are you satisfied that the security issues
    have been explained to you and that you are knowledgeable about
    everything that we may be up against on that?
        Governor Calvo. Again, Mr. Chairman, this is my second time
    to Washington, D.C. meeting with folks at the State Department,
    at the Defense Department, at Homeland Security, and, of
    course, again with Members of Congress in the House, I don't
    see, at least from the point of the Defense Department, the
    levels that I have talked to them, whether it was Under
    Secretary Work or Secretary Forrestal, or the Admiral or the
    General, these concerns on security.
        You go to an island like Guam, anyone who has been there
    understanding the access to the military bases, both Anderson
    and Big Navy, which is the base in the harbor area there, those
    facilities are fenced in and they are secure. So even for local
    residents it is--and in order to get into these facilities you
    need to have the proper credentials.
        The irony I see in all of this, Mr. Chairman, is the
    concerns that they are bringing up with China and Russia, and
    again the good Congressman from Samoa mentioned that, you know.
    We have 100,000 students that come in from China to go to
    school here, and once they get into the contiguous 48 states,
    it is hard to track them. Guam is 212 square miles. The
    security issues, I don't see. It would be more easy for an
    enemy of the United States to go through FAS, the Freely
    Associated States, because there has been a problem, and I have
    seen it, and I have heard about it from our officials in Guam
    where you have an FAS passport. Some folks come in here, then,
    of course, they have been deported, but they just change their
    names and a year or so later they come back in, and when they
    hit the U.S. officials at the airport, they come right in. Hey,
    there is this treaty.
        So the issues on security to me are ironic because I don't
    see it coming from China or from Russia. If there was even an
    issue of security is if there would be an infiltration coming
    from maybe someone from an FAS state.
        Mr. Fleming. OK. Thank you, sir.
        Then, Ms. Ryan, you know, Members of Congress have security
    clearance, and I don't want your answer to, of course, breach
    security limits in any way, shape or form, but my question is
    if we were to have a closed door hearing with officials from
    DHS and State Department, would we be able to get a better
    understanding of what some of these obstacles may be?
        Ms. Ryan. We would be pleased to provide all the
    information in a secure setting, and again, I just want to
    reiterate for all here that there seems to be a lot of focus on
    security as if this was the only issue. Obviously, the
    Secretary looks at the totality of the circumstances and that
    would include, you know, the overstay rates of people who would
    come in, it would include also cooperation on return of their
    nationals in the deportation context for people that we have to
    remove, but we would be glad to provide you the information
    that she is privy to that we have gathered through the
    interagency.
        Mr. Fleming. OK. Well, then I would certainly suggest to
    the panel that we pursue that. That may help give us a better
    insight and understanding, and maybe even timeline because I
    know that is a big issue here today is it is in the Secretary's
    hands, but nobody can tell us when she is going to make a
    decision.
        Well, if we know something that she is looking at maybe we
    can get a better understanding as to what that timeline may be,
    so I will suggest that.
        Well, with that I am going to yield back, and let's see,
    the gentleman--the Ranking Member Mr. Sablan is recognized for
    five minutes.
        Mr. Sablan. Thank you again, Mr. Chairman. Ms. Ryan, please
    bear with me.
        The expiration of asylum Public Law 110-229 provides that
    the asylum provision of INA shall not apply during the
    transition period to persons physically present or arriving in
    the Northern Mariana Islands regardless of how or where entry
    occurs. There are two conflicting references to the date on the
    prohibition. 1702-AC states that asylum shall not apply during
    the transition period which expires December 31, 2014. Section
    207-J5 states that no one is permitted to apply for asylum
    under INS Section 28 prior to January 1, 2014.
        Now, what is the Department's position on the expiration
    date of that bar?
        Ms. Ryan. Ranking Member Sablan, our position is that it is
    the--under the DHS and Department of Justice rule that we
    published in October of 2009 we believe that the January 1,
    2014, date was a clerical error in the CNRA and therefore as a
    matter of law the asylum bar expires on December 31, 2014.
        Mr. Sablan. Wait, wait, wait. So you have no problem with
    those two conflicting dates?
        Ms. Ryan. Well, our regulations and the DOJ regulations
    construe the statute to make it December 31, 2014, but we would
    welcome statutory clarification to resolve the discrepancy.
        Mr. Sablan. Oh, all right. OK. The Commonwealth government,
    our Governor, my Governor and I agree that the bar on asylum
    should be extended. I have introduced H.R. 2395 to provide for
    such an extension to coincide with extensions to the transition
    period. The bill is not the subject of today's hearing but what
    concerns, if any, does the Department have about the bill or
    extending the asylum bar?
        Ms. Ryan. One of the chief goals of the CNRA was to
    harmonize U.S. immigration law in the CNMI with our Federal
    immigration law, so we think it is especially important in
    areas of humanitarian protection. So we would like persons who
    need to seek asylum to be able to enjoy that ability in the
    CNMI, so the harmonization issue is one that presents itself.
        Mr. Sablan. Right. No, I am a Democrat. I agree with all
    those human rights thing, but until we clean out some of the
    issues that we have there I think it would be appropriate that
    we just make it to the transition date up here.
        Now let me say another impact of P.L. 110-229--I am running
    out of time here--was recently brought to my attention. A
    surface freight provider that travels between ports, Saipan and
    Guam. They are having difficulty obtaining work visas for the
    crew as a result of the transition. The BART operates routinely
    between the ports and the islands, it provides bi-weekly
    service, and bringing non-perishable and frozen foods,
    different things between the others. For Tina and Unready, it
    is personally doing surface, freight provider servicing the
    islands. The CNMI was considered a foreign port prior to 110-
    229. The visas previously held by the crew were allowed to--
    them to travel between Guam because it is part of the U.S.
        Recognizing the need for--DHS has cooperated for a one-year
    period. I mean, thank you very much and I appreciate the help
    of your Hawaii office, very important here, but what can the
    Department do to assist the company in a situation,
    particularly now during this transition period?
        Ms. Ryan. Yes. I just became aware of this issue yesterday
    and I am sorry I don't have a more complete answer, but we can
    explore ways to--creative ways to try to make sure that the
    employees on the ship are covered. I don't have an answer
    today, but I will get you one.
        Mr. Sablan. Thank you. One more thing before I let you go.
    I promise this is the last one for you.
        If DHS does not issue regs. out by November, you know, if
    Secretary could use parole authority to allow workers to remain
    in the CNMI, right?
        Ms. Ryan. Yes, sir.
        Mr. Sablan. But would these workers still also be allowed
    to work?
        Ms. Ryan. With parole authority we can grant employment
    authorization.
        Mr. Sablan. Parole allows you to stay, right?
        Ms. Ryan. Parole permits you to stay lawfully in the United
    States.
        Mr. Sablan. But you need separate authorization to work?
        Ms. Ryan. Yes.
        Mr. Sablan. And the Secretary can do that?
        Ms. Ryan. Yes, sir.
        Mr. Sablan. OK, thank you.
        Ms. Pierce, thank you for being here, taking the long trek
    also. And I don't need your--you know better than I do the
    importance of Russian and Chinese visitors to the Commonwealth.
    It has strengthened the economy. In your view, how would
    extending parole to Russian and Chinese tourists to enter Guam
    and eventually including Russia and China in the Guam/CNMI visa
    waiver program have on tourism in the Northern Marianas?
        Ms. Aldan-Pierce. Thank you for your question.
        Actually we see this as a positive opportunity. We see it
    as Guam complementing, you know, what we have to offer. We are
    different destinations, so basically what it will do is offer
    travelers coming to the Marianas one more menu of things to do
    which would work very nicely with the extending of the time
    that is allowed, that gives travelers, you know, to stay, being
    extended from 15 days to 45 days. That was the intent is to
    give the traveler the opportunity to go and visit, hopefully
    visit multiple islands.
        You know, we are all very different. There are four
    inhabited islands in the Marianas--Guam, Saipan, Tinian and
    Rota--and each island offers different--you know, different
    experience. So we see that as an opportunity, plus it is no
    secret, Guam is a lot bigger than we are. They have resources
    that we don't have, Governor Calvo, and I think it will be--it
    will help the CNMI, especially in trying times such as these.
    We do not have a budget they do.
        Mr. Sablan. Thank you. I am running out of time. Just one
    more, may I?
        Ms. Aldan-Pierce. I can say more.
        Mr. Sablan. Making the case for my H.R. 1466, because I say
    it will stabilize the workforce in the Marianas and have a
    positive impact. Out of curiosity, your company, your business
    DFS, do they employ people who are families within the four
    groups? Because I--no question in my mind that your company is
    one of the best companies in the Northern Mariana Islands, and
    I am so proud of what you guys do in the entire Pacific region.
        But do you employ any of these individuals in one of the
    four groups?
        Ms. Aldan-Pierce. We actually--DFS, we have a little bit
    over 200 employees. Out of those we have 25 who are immediate
    relatives. Out of those immediate relatives, there are five who
    are married to FAS, so there will be those five impacted. Plus
    we have three who are CNMI permanent residents.
        In terms of how many are contract workers with U.S. citizen
    children, I actually posed the question just last night and we
    were not able to get that information, but I certainly can
    submit at a later date.
        Mr. Sablan. May I say that if 1466 passes, it will provide
    stability to your employees and then thus your company and thus
    the prosperity of the Northern Mariana Islands.
        Ms. Aldan-Pierce. We have we call the Coffee Hour whereby
    members of the management committee sit down and talk to, you
    know, various groups within our company, and one of the things
    that always comes up, especially for, you know, those classes
    of people who are not covered, the ones who are falling through
    the cracks so to speak, every time we sit down with them they
    always talk about, you know, what is going to happen to them
    and their families.
        So, you know, it is a lot of--they get very emotional, and
    all we can say is not to worry because hopefully things will
    happen in Washington, D.C.
        Mr. Sablan. Thank you very much. My time is up.
        Mr. Landry. [Presiding.] The Chair now recognizes Mrs.
    Bordallo for five minutes.
        Mrs. Bordallo. Thank you, Mr. Chairman.
        I would ask a special request, that I would like for you to
    recognize my friend from Puerto Rico first. He has another
    committee meeting to go to, and then I will be happy to take up
    my questions later.
        Mr. Landry. Sure.
        Mrs. Bordallo. Mr. Pierluisi from Puerto Rico.
        Mr. Landry. Sure. The Chair now recognizes Mr. Pierluisi
    for five minutes.
        Mr. Pierluisi. Thank you, Mr. Chairman.
        Let me first say to the witnesses here present that you
    have seen me coming in and getting out of here. The reason is I
    am a member of the Judiciary Committee and there is a Full
    Committee markup requiring my presence for votes. Otherwise I
    would be here for the whole time. But before I excuse myself
    once again let me first say that I sit here in full solidarity
    with aspirations and needs of my fellow citizens and residents
    in the two territories that are so well represented here today
    by Governor Calvo and Governor Fitial. So count on my support.
    I represent Puerto Rico, by the way, a sister territory.
        Now for the record I would like to show my strong support
    for both legislative measures before us. H.R. 1466 and H.R. 44,
    and to associate myself with the positions of my colleagues,
    Ranking Member Sablan, and our former Chairwoman Madeleine
    Bordallo.
        Mr. Chairman, I urge your support for both of these bills
    and hope that with your and Chairman Hastings' leadership these
    measures will be embraced by the Full House without delay. As
    our witnesses remind us, passage of both bills is time
    sensitive. Separation of families in the Northern Mariana
    Islands is not something that should occur on this Committee's
    watch, and as November 28 looms, this Committee should take
    prompt action to report out H.R. 1466.
        As a member of the Immigration Subcommittee and the
    Judiciary Committee, I am keenly interested in resolving this
    matter. I note that a Full Committee--as I said, there is an
    ongoing matter before the Judiciary Committee and that is why I
    am not going to continue being here. But let me also take this
    opportunity to implore the Subcommittee to embrace H.R. 44.
        The record is complete on this subject, and I was honored
    to speak on the House Floor in support of this legislation in
    my first few weeks as a Member of Congress in 2009. It is
    disappointing this issue remains unresolved for fellow
    Americans from Guam. There simply is no justification for the
    continued denial of justice, and this Congress has before it a
    thorough and sound report from the Federal commission that was
    appointed by the previous Administration to examine this issue.
    The findings and recommendations are as compelling today as
    they were when delivered in this very room on July 21, 2004.
        So, I also thank the witnesses for their testimony, and Mr.
    Chairman, I yield the balance of my time.
        Mr. Landry. Thank you. The Chair will now recognize Mrs.
    Bordallo for five minutes.
        Mrs. Bordallo. Thank you very much, and I do want to thank
    my colleague for his kind words and words of support for these
    bills.
        After the interim final rule on Public Law 110-229 was
    released by the Bush Administration, I worked closely with DHS
    to ensure that parole authority was extended to CNMI
    concurrently with congressional intent and because of the
    immediate economic impact loss of Chinese and Russian tourists
    would have on the CNMI market. Unfortunately, the reason GDP
    economic data indicates that parole authority in the CNMI isn't
    working.
        So my question is for both Governor Fitial and Ms. Pierce,
    can you discuss the potential economic benefit to our region if
    parole authority was extended to Guam and the final rule
    includes China and Russia? Governor.
        Governor Fitial. Thank you, Madam Bordallo.
        I have testified previously on that very issue that you
    raised and I am consistently supporting the visa waiver for
    both CNMI and Guam. I strongly believe that, and I stated in my
    testimony that the parole policy, you know, by DHS is not an
    alternative. We need the visa waiver, you know, to secure the
    economic benefit that comes about as a result of the visa
    waiver for both CNMI and Guam. So that is my request.
        Mrs. Bordallo. Thank you, Governor.
        Would you agree with this comment: that the current parole
    authority is a cumbersome and complicated process for visitors?
        Governor Fitial. That is true.
        Mrs. Bordallo. All right. And Ms. Pierce, would you have
    any comments to make? If you could make it brief because our
    time is always running out.
        Ms. Aldan-Pierce. In terms of--I am not sure about the
    economic activity. What I know is that there are over--the
    number for China is not 55 million. The projection for 2011 is
    65 million outbound market. So in terms of, you know, sheer
    numbers to Guam, I don't know what you--Guam is lucky because
    you guys have more access to air service, you know. Right now
    one of the reasons why it is very hard for the CNMI to grow our
    China market and Russia market is because of the instability of
    air service.
        Our China, our PRC visitors come to the CNMI by charters,
    and you know, we can plan and then all of a sudden they stopped
    because, you know, the cost of fuel, the cost of charter would
    go up, so there is no stability, especially because the parole
    authority really--it is an administrative authority, you know,
    like Ranking Member Sablan mentioned. It is something that may
    change when a new Administration comes in. We don't know. So
    that is why we would like to have under the final rule, you
    know, it becomes legislative, we can better plan, businesses
    can plan, the CNMI can go out and, you know, get airlines to
    commit to us.
        Mrs. Bordallo. Ms. Pierce, would you say that the visitors'
    industry in the Northern Marianas has any objection to Guam
    joining in this--with the parole authority even?
        Ms. Aldan-Pierce. No. I think the majority----
        Mrs. Bordallo. And I think we can work together, right?
        Ms. Aldan-Pierce. Yes, and we actually look forward to
    doing that.
        Mrs. Bordallo. I think this is one thing we have to do,
    Governor Calvo, Governor Fitial, is to see that our two
    communities work closely together, especially in the area of
    tourism, because, you know, in the old days we used to make the
    round robin trips through the islands, and I think if the two
    visitors' bureau industries work together closely that we can
    really make this a truly Pacific destination that people look
    forward to.
        There are things in the Marianas, there are items of
    interest in Guam that tourists would certainly like to see and
    if we work together closely, I don't think this has been
    happening in the past, so let us--we have the two industry
    managers, directors here with us. I have talked to Joann
    Camacho on this, and she is very receptive to working closely
    with the CNMI. So let us let that happen because that will make
    our communities grow.
        Thank you. I yield back, Mr. Chairman.
        Governor Fitial. Congresswoman----
        Mrs. Bordallo. Yes, go ahead, Governor.
        Governor Fitial. I just wanted to inform you that Governor
    Calvo and I have pledged to work together, you know, to re-
    unify the Marianas.
        Mrs. Bordallo. Good.
        Governor Fitial. So I just want you to know that I need
    your support also.
        Mrs. Bordallo. You always have my support, Governor.
        Governor Fitial. Yes, I need your support to allow the CNMI
    also to participate in some economic activities that are
    presently, you know, prohibited in CNMI.
        Mrs. Bordallo. Like some of the military building?
        Governor Fitial. Yes.
        Mrs. Bordallo. All right, Governor. We will work on that.
    Thank you. I yield back, Mr. Chair.
        Mr. Landry. The Chair now recognizes Mr. Faleomavaega----
        Mr. Faleomavaega. John Wayne, Mr. Chairman.
        [Laughter.]
        Mr. Landry. I know how it feels. I am from south Louisiana.
        Mr. Faleomavaega. Well, let us have some Cajun breakfast
    here, then we will take care of that.
        Thank you, Mr. Chairman. I wanted to just follow up on my
    good friend Mrs. Bordallo's line of question, Governor Fitial.
        I understand there was some kind of a poll or survey or
    whatever that was taken in CNMI recently in terms of those who
    want to have unification with Guam, and maybe my good friend
    Mr. Sablan can assist. For the record, is there a movement in
    CNMI to see about the possibility of reunification of the
    Chamorro people between Guam and CNMI?
        Governor Fitial. The Marianas, including Guam and CNMI,
    have always been together until, you know, after the Spanish-
    American War. So right now as I stated earlier, Governor Calvo
    and I, right after his inauguration, we pledged together to
    work toward unifying the Marianas.
        CNMI did vote in a referendum to associate or to reunify
    with Guam in the late fifties, 1959, to be exact. However, our
    brothers and sisters in Guam, you know, were not prepared at
    that time, so now it seems----
        Mr. Faleomavaega. Were they not prepared or just simply
    objected to the idea of reunification?
        Governor Fitial. I didn't want to use a stronger word, but
    I just want to say they were not prepared to accept their
    brothers and sisters from the north, you know, to be together,
    but as time goes on it seems, you know, important and apparent
    that this is the right direction to take, and that is the
    reason why Guam and CNMI along with our brothers and sisters in
    the Micronesia region are now collaborating together.
        Mr. Faleomavaega. I raise this question with interest,
    Governor, because we seem to have a similar situation in the
    Samoan Islands because 40 miles away from American Samoa is the
    independent state of Samoan composed of the two largest
    islands, and the misinformation that goes around that we were
    ever a united people, we were never a united people as far as--
    --
        Governor Fitial. For your information, you know, American
    Samoa, although it is part of Polynesia, has become an official
    member of the Micronesian Executives.
        Mr. Faleomavaega. Well, it is my understanding, you know,
    the people who built those lata stones, if you understand, were
    Samoans that were there that built the lata stones.
        [Laughter.]
        Mr. Faleomavaega. Just wanted to remind the Governor of
    that little bit of history there.
        Dr. Gootnick, I note with interest your testimony that
    there seems to be some strong disagreements of the survey that
    was conducted by the Department of the Interior, and with that
    of CNMI. Could you comment on this in terms of the number of
    illegal aliens or number of aliens that are in CNMI, and
    certainly welcome Mr. Pula's response to that.
        Mr. Gootnick. Well, it is an interesting question, Mr.
    Faleomavaega. There were a number of objections raised to the
    Department of the Interior's study. The first being the
    Governor was concerned that he was not properly consulted as
    required under the CNRA. The second being the way in which data
    was collected that formed the basis of the policy options and
    some of the quantitative information that was presented there.
        I would say that remains an open question. There has been
    an exchange of letters that are in the public record between
    the Governor and the Assistant Secretary of the Interior, and
    the Assistant Secretary stands by the data that forms the basis
    of the report.
        There is, in addition, some outstanding FOIA request and
    litigation in process. I am not an expert on what is taking
    place in the judicial system with respect to this.
        Mr. Faleomavaega. My time is running out so I would like to
    ask Mr. Pula for his comment about this disagreement on data.
        Mr. Pula. Thank you, Congressman. I think in the issue of
    consultation when both the Governor and Assistant Secretary
    Babauta last year testified in this room, they had a difference
    of opinion. I think, now I hope the Governor is assured that we
    are now consulting with each other in terms of Interior and the
    Governor.
        As far as the report that was submitted by OIA in April
    2010, there is that discrepancy of numbers, and the way perhaps
    it was done. Because there was no--at the time--valid
    information that the Department of the Interior could depend
    on, and it was a requirement under CNRA for the Department to
    do a report of how many aliens there, our ombudsman's office in
    CNMI then basically made announcements out to the community----
        Mr. Faleomavaega. Without consulting with the Governor.
        Mr. Pula. Well, we did to the extent that they know that we
    were going to do a report on the requirement. I think perhaps
    maybe the issue of not consulting with the Governor, at this
    point perhaps it is a difference of definition of consulting.
    From the Assistant Secretary's point of view he did consult
    with the Governor in a meeting.
        Mr. Faleomavaega. I am sorry, Mr. Chairman. I know my time
    is up. I will thank you.
        Mr. Landry. No problem. At this time I would like to thank
    all of our witnesses for their valuable testimony and
    contributions. Members of the Subcommittee may have additional
    questions for the witnesses, and we ask that you respond to
    these in writing. The hearing record will be open for 10 days
    to receive these responses.
        We will now prepare for the second panel.
        [Pause.]
        H.R. 44
        Mr. Landry. If we can get everyone to take their proper
    seats.
        All right, we will now move on to the second panel to hear
    testimony on H.R. 44, the Guam World War II Loyalty Recognition
    Act introduced by our colleague from Guam, Congresswoman
    Bordallo.

    STATEMENT OF THE HON. JEFF LANDRY, A REPRESENTATIVE IN CONGRESS
                      FROM THE STATE OF LOUISIANA

        Mr. Landry. A week from today, July 21, 2011, is the sixty-
    seventh anniversary of American troops liberating Guam. It is
    my understanding that this morning Congresswoman Bordallo with
    Ranking Member Sablan and Governor Calvo honored the lives lost
    during the liberation of Guam by the Third Marine Division and
    77th Infantry Division in 1944 at a wreath-laying ceremony at
    the Tomb of the Unknowns at Arlington National Cemetery.
        Arlington Cemetery is a reminder to all of us of the
    ultimate sacrifice brave American military personnel, both men
    and women, have paid for the price of freedom in this country.
    Unspeakable actions occurred during the war. I don't think
    anyone would disagree that the residents of Guam was subjected
    to many horrors during the 32 months of Japanese occupation.
    Horrible acts were occurring in every occupied area during
    World War II.
        The 79th U.S. Congress responded quickly to the plight of
    Guam's residents and in 1945 pass the Guam Meritorious Claims
    Act to provide immediate relief to the residents of Guam. The
    Act paid 4,356 individuals over $8 million. Congress also
    passed the Guam Land Transfer Act and Guam Rehabilitation Act.
        The Guam Meritorious Claims Act is said to have been the
    primary means of settling war claims for the people of Guam.
    The Guam Land Transfer Act enabled land exchanges for
    resettlement purposes and the Guam Rehabilitation Act
    appropriated $6 million for construction, and was the means for
    economic rehabilitation.
        While I understand that H.R. 44 has been considered in
    previous Congresses, this is my first opportunity to review
    this measure as it may be for other members of the
    Subcommittee. I understand from my preparation for this hearing
    that many people here today believe the Guam Meritorious Claim
    Act was a start in the process, but was incomplete and did not
    adequately compensate the residents of Guam in comparison to
    other war claims statutes.
        It is also my understanding from the documents in the Guam
    Review Commission Report that the intent of the Guam
    Meritorious Claim Act was not to make Guam residents whole;
    instead it was, at least with regard to property, to provide
    people relief.
        I am concerned that if we go forward with this legislative
    proposal we could be opening Congress up to additional war
    claims. Documents in the Commission report make note of some
    400,000 Americans who suffered injury in World War II, who
    never received compensation for their injuries. The President
    of the Heritage Foundation notes that the U.S. bears no blame
    here, and no responsibility. We fought to prevent the island
    from being taken by the Japanese, and fought to free it again.
        Some 3,000 American were killed and more than 7,000 wounded
    in the 1944 battle for the island. That is a price paid in
    blood that can never be made up in mere dollars. Even the Guam
    War Claims Review Commission stated that the U.S. Government is
    not obligated as a matter of law to pay such compensation.
        During this hearing I hope to find out why there is a need
    for additional compensation, who will be compensated under H.R.
    44, why the Japanese Government did not pay the initial
    compensation in 1945, and how the Federal Government is going
    to pay more than $100 million when we are nearly $15 trillion
    in debt.
        As I indicated at the beginning of this statement, I am
    deeply sympathetic to those living in Guam during the
    occupation of the Japanese Imperial Army. They were treated in
    a particularly oppressive, cruel and barbaric way. Sadly,
    paying this compensation will not bring back the dead, nor will
    it undue the 32 months of hell which they endured.
        I look forward to hearing the testimony of our
    distinguished witnesses.
        [The prepared statement of Mr. Landry follows:]

     Statement of The Honorable Jeff Landry, a Representative in Congress
    from the State of Louisiana, on H.R. 44, The Guam World War II Loyalty
                                Recognition Act

        We will now move on to the second panel to hear testimony on H.R.
    44, the Guam World War II Loyalty and Recognition Act, introduced by
    our colleague from Guam, Congresswoman Bordallo.
        A week from today, July 21, 2011, is the 67th Anniversary of
    American troops liberating Guam. It is my understanding that this
    morning, Congresswoman Bordallo, with Ranking Member Sablan and
    Governor Calvo, honored the lives lost during the liberation of Guam by
    the 3rd Marine Division and 77th Infantry Division in 1944 at a wreath
    laying ceremony at the Tomb of the Unknowns at Arlington National
    Cemetery. Arlington Cemetery is a reminder to us all of the ultimate
    sacrifice brave American military personnel--men and women--have paid
    for the price of freedom in this country.
        Unspeakable actions occur during war. I don't think anyone will
    disagree that residents of Guam were subjected to many horrors during
    the 32 months of Japanese occupation. Horrible acts were occurring in
    every occupied area during World War II.
        The 79th U.S. Congress responded quickly to the plight of Guam
    residents and, in 1945, passed the Guam Meritorious Claims Act to
    provide ``immediate relief'' to the residents of Guam. The Act paid
    4,356 individuals over $8 million dollars. Congress also passed the
    Guam Land Transfer Act and the Guam Rehabilitation Act.
        The Guam Meritorious Claims Act is said to have been the primary
    means of settling war claims for the people of Guam. The Guam Land
    Transfer Act enabled land exchanges for resettlement purposes and the
    Guam Rehabilitation Act appropriated $6 million for construction and
    was the means for economic rehabilitation.
        While I understand H.R. 44 has been considered in previous
    Congresses, this if my first opportunity to review this measure, as it
    may be for other Members of the Subcommittee. I understand from my
    preparation for this hearing that many people here today believe the
    Guam Meritorious Claims Act was a start in the process, but was
    incomplete and did not adequately compensate residents of Guam in
    comparison to other war claim statutes.
        It is also my understanding from documents in the Guam Review
    Commission report that the intent of the Guam Meritorious Claims Act
    was to not make Guam residents ``whole'', instead it was, at least with
    regard to property, to provide people relief. I am concerned that if we
    go forward with this legislative proposal we could be opening Congress
    up to additional war claims. Documents in the Commission report make
    note of some 400,000 Americans who suffered injury in World War II who
    never received compensation for their injuries.
        The President of the Heritage Foundation notes that: ``The U.S.
    bears no blame here, and no responsibility. We fought to prevent the
    Island from being taken by the Japanese, and fought to free it again.
    Some 3,000 Americans were killed and more than 7,000 wounded in the
    1944 battle for the Island. That's a price paid in blood that can never
    be made up with mere dollars.'' Even the Guam War Claims Review
    Commission stated that: ``The U.S. government is not obligated as a
    matter of law to pay such compensation.''
        During this hearing I hope to find out: why there is a need for
    additional compensation; who will be compensated under H.R. 44; why the
    Japanese government did not pay the initial compensation in 1945; and
    how the federal government is going to pay more than $100 million when
    we are nearly $15 trillion in debt.
        As I indicated at the beginning of this statement, I am deeply
    sympathetic to those living in Guam during the occupation by the
    Japanese Imperial Army. They were treated in a particularly oppressive,
    cruel and barbaric way. Sadly, paying this compensation will not bring
    back the dead nor will it undue the 32 months of hell which they
    endured.
        I look forward to hearing the testimony of our distinguished
    witnesses, and now recognize our Ranking Member Mr. Sablan, for any
    statement he would like to make.
                                     ______

        Mr. Landry. I now recognize the Ranking Member, Mr. Sablan,
    for any statement he would like to make.

     STATEMENT OF THE HON. GREGORIO SABLAN, A DELEGATE IN CONGRESS
         FROM THE COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

        Mr. Sablan. Thank you very much, Mr. Chairman.
        H.R. 44, the Guam World War II Loyalty Recognition Act,
    which is sponsored by my colleague and friend, Congresswoman
    Madeleine Bordallo, would implement the recommendations of a
    Federal commission that was authorized by the 107th Congress to
    look at this specific issue. The Commission found that the
    people of Guam were treated unfairly during the war claims
    process immediately following World War II as compared with
    other claims programs authorized by Congress addressing
    similarly experienced losses and damages for other Americans.
        Each of the four delegates from Guam to have served in the
    House have worked diligently to resolve this longstanding
    injustice faced by their constituents, and the text of H.R. 44
    has passed on five separate occasions.
        It is long past time that we resolve this issue and provide
    relief for the people of Guam for the nearly three years of
    brutal occupation they suffered because of their steadfast
    loyalty to our country and nation.
        Thank you, Mr. Chairman, for allowing me to make this
    opening statement. I want to welcome all of our witnesses,
    especially former Congressman Ben Blaz, again Governor Calvo,
    Mr. Pula and Mr. Tamargo, and look forward to hearing your
    testimony. Thank you.
        Mr. Landry. Thank you, and I will recognize Mrs. Bordallo
    for any statement she would like to make on her bill.

        STATEMENT OF THE HON. MADELEINE BORDALLO, A DELEGATE IN
                    CONGRESS FROM THE ISLAND OF GUAM

        Mrs. Bordallo. I thank you very much, Chairman Landry, and
    Ranking Member Sablan, and I would like to thank both of you
    for holding today's hearings on H.R. 44, the Guam World War II
    Loyalty Recognition Act, which I introduced on the first day of
    the 112th Congress, and I want to thank Chairman Hastings and
    Ranking Member Markey for their agreeing to allow a hearing on
    H.R. 44 as well.
        I also want to acknowledge Speaker Won Pat of the 31st Guam
    Legislature. She has traveled here to Washington and has
    submitted written testimony for the Committee, and I would like
    to turn this over to the Chairman now.
        Mr. Landry. Without objection, so ordered.
        [The prepared statement of Speaker Won Pat follows:]

     Statement of The Honorable Judith T. Won Pat, Ed.D., Speaker, Thirty-
     First Guam Legislature, on the Implementation of P.l. 110-229 in Guam
           (Specific Reference to the Guam-CNMI Visa Waiver Program)

        Buenas yan Hafa Adai (Greetings) from the territory island of Guam.
    Esteemed Chairman John Fleming, M.D., and members of the Committee;
    Congressman Don Young, Congressman Robert Wittman, Congressman Jeff
    Duncan, Congressman Steve Southerland, Congressman Bill Flores,
    Congressman Andy Harris, Congressman Jeff Landry, Congressman Jon
    Runyan, Congressman Doc Hastings, Congressman Eni Faleomavaega,
    Congressman Frank Pallone, Jr., Congresswoman and my friend from Guam,
    Madeleine Bordallo, Congressman Pedro Pierlusi, Congresswoman Colleen
    Hanabusa, Congressman Edward Markey. Thank you for the opportunity to
    present testimony for the oversight hearing on the implementation of
    P.L. 110-229, the Consolidated Natural Resources Act, specifically in
    the matter of the Guam-CNMI Visa Waiver program.
        As Speaker of the Guam Legislature this testimony is submitted in
    support of the full implementation of the Guam-CNMI Visa Waiver
    program.
        The United States and the Marianas, a member of the American
    family, are both facing extreme financial challenges that are rippling
    through the public and private sectors forcing threats of lay-offs,
    reduced work hours, or a reduction in services.
        Commerce Secretary Garry Locke acknowledges that the United States
    within the past two years has seen itself in the midst of the toughest
    recession in decades (June, 2011).
        Similar to the financial woes plaguing the United States, Guam is
    also experiencing severe economic challenges. As a whole, Guam has
    experienced a downward economy for the past three years, from revenues
    of $514.8M in FY 2007 to $491M in FY 2010. Guam's general fund revenues
    are below budget with projected sustained declines as a result of a
    depressed tourism market under the current conditions. The unemployment
    rate on Guam in the past three years has increased steadily from 8.3%
    in September 2007 to 13.3% in March of 2011 (see Table 1).
    [GRAPHIC] [TIFF OMITTED] 67403.016

        .epsThe writing on the wall is clear. The United States government
    and the government of Guam must look towards developing opportunities
    that may serve to maintain budget levels in the public sector and jobs
    in the private sector. Anything less would result in a continued
    economic downward spiral.
        Guam's economy is greatly influenced by its geographic location.
    Being that Guam is a geographically disparate society when compared to
    the rest of the contiguous United States, the island's economy is
    driven by a few key markets. One of the most important of these is
    tourism. For instance, Guam's designation as an up-scale tropical
    Pacific vacation destination in addition to its nearness to Japan is a
    competitive advantage. The island's status as a U.S. territory with a
    stable government and security adds to this advantage.
        The Guam-CNMI Visa Waiver program is an excellent opportunity to
    ``test market'' the Russia and China markets for future consideration
    under the broader Visa Waiver program. The vast market potential
    inherent in an expanded Guam-CNMI Visa Waiver program that is inclusive
    of Russia and China is consistent with the U.S. Travel Association
    Report ``Ready for Take-Off: A plan to create 1.3 million U.S. jobs by
    welcoming international travellers.''
        The Guam-CNMI Visa Waiver program represents an opportunity to
    insulate Guam and the CNMI from the woes associated with national and
    international economic downturn.
        Our other major economy is the U.S. military--and with the
    increasing uncertainty regarding the military realignment from Okinawa,
    we must look to maturing other markets such as China and Russia in
    order to offset any deficits in revenues tied to delayed activity
    associated with the realignment.
        The outlook for international tourist arrivals remains promising.
    According to the World Tourism Organization, in 2010 international
    tourism receipts are estimated to have reached US$919 billion
    worldwide. More to the point, given the optimistic outlook for tourism
    in general and sustained growth in the Chinese and Russian travel
    markets, both the Marianas and the United States stand to gain by
    making such destinations accessible.
        I applaud the Committee for recognizing the potential that tourism
    activities represent in being able to stabilize-if not outright lift-
    our respective national and insular area economies. The U.S. Travel
    Association anticipates that 1.3 million U.S. jobs and a $859 billion
    infusion into the U.S. economy by 2020 will be realized by as a result
    of reforming antiquated visa processes. As you are aware, Congress may
    continue to serve as a critical partner in realizing such economic
    potential by creating policy that serves to empower regulatory agencies
    as well as the free market to implement programs and procedures that
    would reduce the barriers to entry into the U.S. and the Marianas
    without sacrificing safeguards that are already in place.
        China is the world's fastest growing economy with average GDP
    growth rates averaged at 10% over the past 30 years. Over the past
    three years China arrivals into the United States and Guam increased
    steadily with projected double digit growth within this year alone.
    According to the U.S. Travel Association the U.S. received $5.0 billion
    from Chinese visitors with an average expenditure per person of $6,423.
        According to a forecast from the World Tourism Organization, China
    will have 100 million outbound travellers and become the fourth largest
    source of outbound travel in the world by 2020 making China an
    explosive growth market for tourism.
        Russian foreign travel remains largely untapped. Only 15% of
    Russia's 142 million people have ever travelled abroad. According to
    the World Tourism Organization, Russia ranked within the tenth largest
    outbound travel market in the world in terms of expenditures. Other
    sources cite Russian outbound trips at 12 million with travel
    expenditures abroad at $27 billion for 2011 alone.
        Combined, it is estimated that China and Russia non-immigrant
    visitors may generate $212.2 million in combined payroll, hotel
    lodging, and gross receipts taxes by 2018. Without these two markets
    being added vis-a-vis the Guam-CNMI Visa Waiver program, Guam may
    experience a 32% reduction in tourism related revenues over the next
    five years.
        I must underscore that tourism is a significant driver of Guam's
    economy. According to one report, tourism ranks as the second largest
    private industry in the island accounting for as much as 35% of the
    total jobs on Guam. Simply, 1 out of every 4 workers on Guam is
    directly employed by the tourism sector.
        An average aggregate visitation rate of approximately 1 million
    visitors to Guam annually generates $1.2 billion in total tourism
    expenditures. The total impact in taxes paid are significant as well,
    totaling approximately $148.9 M in 2005.
        Although tourism figures worldwide remain optimistic, travel from
    Japan and Korea to Guam have significantly declined this past decade as
    a direct result of regional crises such as SARS, September 11, natural
    disasters on Guam and, most recently, in Japan-with its triple
    earthquake, tsunami, and nuclear power plant crisis-as well. These
    depressed levels, in addition to a negative strategic outlook for these
    two markets as a result of their low birth rates and increasing
    competition, require our island's leaders to act in seeing the full
    implementation of the Guam-CNMI Visa Waiver program.
        It is essential that the Department of Homeland Security implement
    the Guam-CNMI Visa Waiver program to mitigate the losses in tourism
    related revenues as a result of attrition in the declining mature
    markets of Japan and Korea. Anything less of this may burden hotels and
    other tourism related employers to reduce work hours, lay off
    employees, or close-up shop. Similarly, without an expanded tourist
    market, the government of Guam may not be able to meet its existing
    liabilities thereby forcing lawmakers to declare financial exigency and
    request for increased federal aid.
        The bright side is this: with an expanded Guam-CNMI Waiver program
    that is inclusive of China and Russia and implemented on Guam, the
    island's economy will be preserved with projected growth of $1.5
    billion from these two new markets in five years.
        As most experts agree, the economies of the United States and Guam
    are in a recession. To reinvigorate our economies both the Congress and
    the administration must continue in its path to create and implement a
    21st century regulatory framework that will allow us to pursue a bold
    opportunity for the American and Chamorro people. PL 110-229,
    specifically the Guam-CNMI Visa Waiver program, is an example of how
    government policy may work to continue to foster and support
    entrepreneurship and innovation.
        As we jointly face our financial crises, I am resolved that the
    Guam-CNMI Visa Waiver program will add towards our collective efforts
    to stabilize and grow our national and state-level economies. Based on
    market research and data available to the government of Guam, even the
    most conservative of figures associated with an expanded tourism base
    that includes China and Russia will considerably affect Guam and the
    CNMI in a positive way.
        In the wake of extreme financial uncertainty, I humbly submit that
    the Guam-CNMI Visa Waiver program would serve as a significant economic
    stimulus for the Marianas Islands.
        In closing, on behalf of the Thirty-first Guam Legislature and the
    People of Guam I commend the Honorable Doc Hastings, Chairman of the
    Committee on Natural Resources and Members of the Committee, in
    addition to the Honorable John Fleming, M.D., Chairman of the
    Subcommittee on Fisheries, Wildlife, Oceans and Insular Affairs, and
    Members of the Subcommittee for allowing me to provide testimony on the
    implementation of P.L. 110-229, the Consolidated Natural Resources Act,
    specifically the Guam-CNMI Visa Waiver program.
                                     ______

        Mrs. Bordallo. The one Guam approach in resolving this
    issue is something that is very, very important, and I always
    appreciate the participation and the input of our legislative
    leaders, and pleasure to include her testimony in the record.
        Finally, I would like to thank and recognize each of our
    witnesses here today. Governor Calvo, we appreciate your
    traveling to D.C. to provide testimony in both of today's
    panels. We will appreciate your input on the importance of
    passing H.R. 44.
        General Ben Blaz, a very distinguished gentleman who has
    served in this Congress from 1985 to 1992. He is also a retired
    Marine and is a survivor, which is why he is here today, of the
    Japanese occupation of Guam. General Blaz's testimony today
    speaks to the atrocities and the hardships endured by our
    people during the brutal enemy occupation, and further, General
    Blaz's experience as a general in the U.S. Marine Corps can
    speak to the importance of building good relationships with the
    civilian community and the significance of the passage that
    Guam war claims would have to building this type of
    relationship in Guam.
        Another witness today, Mr. Chairman, I would like to thank
    Mr. Mauricio Tamargo. He is the former Chairman of the Guam War
    Claims Review Commission for his testimony, and in all of these
    years he has stood by us to help us get this bill through. Mr.
    Tamargo understands the issue of the Guam war claims, and I
    appreciate his expert testimony. He has also held public
    hearings on this issue as well as a public hearing in Guam.
        And finally, I also want to thank the testimony of Mr. Nik
    Pula. I appreciate the Administration's continued support of
    H.R. 44.
        Today's hearing builds on the lengthy and substantive
    legislative record that has already been developed on H.R. 44.
    The issue of Guam war claims is a sensitive issue for my
    constituents and it is an issue that can only be resolved
    through legislation by Congress.
        Further, it is a matter that has maintained strong support
    in the House. As Ranking Member Sablan said, it has passed this
    House five times, even across party lines. Further, the
    bipartisan nature of our witnesses speaks to H.R. 44's broad
    base of support. The need for this Congress to take action and
    resolve the matter or Guam war claims heightens by the day.
    Continued popular support for the military build up on Guam is
    tied to a great extent to finally solving this longstanding
    issue on Guam.
        My constituents wonder how we can spend over $10 billion in
    military construction but their suffering and patriotism during
    the Imperial Japanese occupation of Guam is yet to be fully
    recognized and redressed.
        In part, it is for this reason that I attach H.R. 44 as an
    amendment to the National Defense Authorization Act in Fiscal
    Years 2010 and 2011. Unfortunately, the Senate failed to act on
    the stand alone measure on the 110th and 111th Congresses.
        Further, last year we did reach a compromise position on
    Guam war claims, and it was incorporated into conference
    version of the Fiscal Year 2011 NDAA. However, due to the
    unique legislative procedure that was required for passage, a
    few senators blocked its inclusion in the final legislation.
    This, unfortunately, is a circumstance that many bills face in
    the Senate, so it is important that we build off the agreed
    upon compromise, and I believe today's hearing will clearly
    highlight the importance of this legislation.
        As such, on the first day of this Congress I re-introduced
    H.R. 44, and the text of this bill is identical to the
    compromise reached with Chairman Levin and Ranking Member
    McCain. The bill removes the most controversial claimant
    category of payments to the descendants of survivors of the
    Japanese occupation. I did so reluctantly, but in a recognition
    that including that category would not pass in the Senate. So,
    I am hopeful that this hearing will further illuminate the
    facts and circumstances surrounding the occupation endured by
    the people, and the injustice that they hope will finally be
    redressed by this Congress.
        This is an injustice rooted in their having been treated
    differently from their fellow Americans by the Federal
    Government in redressing their war claims. The hearing today
    presents another opportunity to review this history, however
    painful it may be to recount and repeat. We further this
    discussion today in the name and the pursuit of justice, and
    with faith in our government and her cherished principle of
    equal protection under the law.
        We must also remain focused and determined because of the
    very findings and the recommendations of now two Federal
    commissions that have independently and thoroughly examined
    this matter against all its political and legal sensitivities.
        The last hearing on Guam war claims was held on December 2,
    2009, before the House Armed Services Committee, and at that
    time our survivor witness was Mr. Tom Barcinas. Mr. Barcinas
    told the Committee of his first-hand experience during World
    War II, and of the atrocities suffered by him and his family at
    the hands of the enemy, and I am going to quote something he
    said.
        ``Through the grace of God I survived World War II, but
    like so many others who lived through those days, lived through
    the war who have since died, I am quickly getting old as you
    can see. So many who lived through the war are advancing in age
    and so many have passed on without closure to the issues
    arising because of the war . . . Mr. Chairman, no one must
    underestimate the importance of resolving the issue of parity,
    fairness, and justice related to the administration of the war
    claims. Resolving these issues will provide beyond any
    reasonable doubt that America does live up to its promises and
    its responsibilities.''
        Just this past April, only three months ago, Mr. Chairman,
    Mr. Barcinas passed away after waiting nearly 70 years for
    closure and for recognition that he never ever received.
        So, it is important that Congress act now to implement the
    Review Commission's recommendations and finally resolve this
    longstanding injustice for the survivors of the occupation of
    Guam, and I thank you very much, Mr. Chairman.
        [The prepared statement of Mrs. Bordallo follows:]

       Statement of The Honorable Madeleine Z. Bordallo, Ranking Member,
        Subcommittee on Fisheries, Wildlife, Oceans and Insular Affairs

        Chairman Fleming and Ranking Member Sablan, I would like to thank
    you both for holding today's hearing on H.R. 44, the Guam World War II
    Loyalty Recognition Act, which I introduced on the first day of the
    112th Congress. I want to thank Chairman Hastings and Ranking Member
    Markey for their agreeing to allow a hearing on H.R. 44, as well.
        I also want to acknowledge Speaker Judith Won Pat of the 31st Guam
    Legislature. She has submitted written testimony for the Committee and
    is in the audience today. Her presence and support today are a tribute
    to our ``One Guam'' approach in resolving this issue. I always
    appreciate the participation and input of our legislative leaders and
    pleasure to include her testimony in the record.
        Finally, I would like to thank and recognize each of our witnesses
    here today. Governor Calvo, we appreciate your travelling to DC to
    provide testimony in both of today's panels. We will appreciate your
    input on the importance of passing H.R. 44 to the people of Guam.
    General Ben Blaz is the former Congressman from Guam serving in the
    House from 1985 to 1992. General Blaz is also a retired Brigadier
    General in the U.S. Marine Corps and is a survivor of the Japanese
    occupation of Guam. General Blaz's testimony today speaks to the
    atrocities and hardships endured by the people of Guam during the
    brutal enemy occupation. Further, his experiences as a General in the
    U.S. Marine Corps can speak to the importance of building good
    relationships with the civilian community and the significance the
    passage of Guam war claims would have to building this type of
    relationship on Guam. I would also like to thank Mr. Mauricio Tamargo,
    former Chairman of the Guam War Claims Review Commission for his
    testimony today. Mr. Tamargo understands the issue of Guam War Claims
    well and I appreciate his expert testimony. Finally, I also thank the
    testimony of Mr. Nik Pula. I appreciate the Administration's continued
    support for H.R. 44.
        Today's hearing builds on the lengthy and substantive legislative
    record that has already been developed on H.R. 44. The issue of Guam
    War Claims is a sensitive issue for my constituents and it is an issue
    that can only be resolved through legislation by Congress. Further, it
    is a matter that has maintained strong support in the House, even
    across party lines. Further, the bi-partisan nature of our witnesses
    speaks to H.R. 44's broad base of support. The need for this Congress
    to take action and resolve the matter of Guam war claims heightens by
    the day. Continued, popular support for the military build-up on Guam
    is tied, to a great extent, to finally solving this longstanding issue
    for many on Guam. My constituents wonder how we can spend over $10
    billion in military construction but their suffering and patriotism
    during the Imperial Japanese occupation of Guam has yet to be fully
    recognized and redressed.
        In part, it is for this reason that I attached H.R. 44 as an
    amendment to the National Defense Authorization Act in Fiscal Years
    2010 and 2011. Unfortunately, the Senate failed to act on the stand-
    alone measure in the 110th and 111th Congresses. Further, last year we
    did reach a compromise position on Guam war claims and it was
    incorporated into conference version of the FY11 NDAA. However, due to
    the unique legislative procedure that was required for passage, a few
    Senators blocked its inclusion in the final legislation. This,
    unfortunately, is a circumstance that many bills face in the Senate. So
    it is important that we build off the agreed upon compromise and I
    believe today's hearing will clearly highlight the importance of this
    legislation.
        As such, on the first day of this Congress I reintroduced H.R. 44
    and the text of this bill is identical to the compromise reached with
    Chairman Levin and Ranking Member McCain. The bill removes the most
    controversial claimant category of payments to the descendants of
    survivors of the Japanese occupation who suffered personal injury. I
    did so reluctantly but in a recognition that including that category
    would not pass in the Senate.
        I am hopeful that this hearing will further illuminate the facts
    and circumstances surrounding the occupation endured by the people of
    Guam and the injustice that they hope will finally be redressed by this
    Congress. This is an injustice rooted in their having been treated
    differently from their fellow Americans by the federal government in
    redressing their war claims. The hearing today presents another
    opportunity to review this history, however painful it may be to
    recount and repeat. We further this discussion today in the name and
    pursuit of justice and with faith in our government and her cherished
    principle of equal protection under law. We also remain focused and
    determined because of the very findings and recommendations of now two
    federal commissions that have independently and thoroughly examined
    this matter against all its political and legal sensitivities.
        The last hearing on Guam war claims was held on December 2, 2009
    before the House Armed Services Committee. At that time our survivor
    witness was Mr. Tom Barcinas. Mr. Barcinas told the Committee of his
    firsthand experiences during World War II and of the atrocities
    suffered by him and his family at the hands of enemy occupation:
            ``Through the grace of God, I survived World War II. But like
            so many others who lived through those days, lived through the
            war, who have since died, I am quickly getting old, as you can
            see. So many who lived through the war are advancing in age,
            and so many have passed on without closure to the issues
            arising because of the war. . .Mr. Chairman, no one must
            underestimate the importance of resolving the issues of parity,
            fairness and justice related to the administration of the war
            claims. Resolving these issues will prove beyond any reasonable
            doubt that America does live up to its promises and
            responsibilities.''
        Just this past April, only 3 months ago, Mr. Barcinas passed away
    after waiting nearly 70 years for closure and recognition that he never
    received. It is important that Congress act now to implement the Review
    Commission's recommendations and finally resolve this longstanding
    injustice for the survivors of the occupation of Guam.
                                     ______

        Mr. Landry. Thank you, Mrs. Bordallo. At this time I would
    like to enter into the record two different letters, one from
    the Heritage Foundation and another one from American Tax
    Reform into the record. Without objection, so ordered.
        [The letters follow:]
        [GRAPHIC] [TIFF OMITTED] 67403.013

        .eps[GRAPHIC] [TIFF OMITTED] 67403.014

        .eps[GRAPHIC] [TIFF OMITTED] 67403.015

        .epsMr. Landry. For those witnesses who were not here for
    the first panel I will repeat what Congressman Fleming,
    Chairman Fleming said earlier; that your written testimony will
    appear in full in the hearing records so I ask that you keep
    your oral statements to five minutes as outlined in our letter
    of invitation to you and under Committee Rule 4(a).
        Our microphones are not automatic, so please press the
    button when you are ready to begin. I will also explain how our
    timing lights work. When you begin to speak our clerk will
    start the time and a green light will appear. After four
    minutes a yellow light will appear, and at that time you should
    begin to conclude your statement. After five minutes the red
    light will come on and you may complete your sentence, but at
    that time I would ask that you stop.
        I would now like to welcome today's witness The Honorable
    Eddie Baza Calvo, Governor of Guam. Governor.

                STATEMENT OF THE HON. EDDIE BAZA CALVO,
                     GOVERNOR OF THE ISLAND OF GUAM

        Governor Calvo. Yes, thank you very much, Mr. Chair and
    Members of the Subcommittee.
        Again, my name is Eddie Calvo, Governor of Guam. On behalf
    of the people of Guam, especially those who found themselves
    slaves during World War II, I would like to express my support
    for H.R. 44, also know as the Guam World War II Loyalty
    Recognition Act.
        Distinguished Members of the House of Representatives, war
    claims for the people of Guam are long overdue. On December 8,
    1941, our island was changed forever. For all you know, that
    was the day Japan attacked my home. For nearly three years,
    those in Guam were forced out of their homes, were subjected to
    slavery and suffered rapes and beatings. Tragically, many died
    in the hands of the Japanese Imperial Army.
        On July 21, 1944, or what is now known as Liberation Day,
    American Marines and soldiers stormed Guam and began a
    successful campaign to reclaim the island. Every year the
    entire island commemorates the bravery of these men, remembers
    their loved ones who survived our darkest time in history, and
    prayed for those whose lives were stolen by war.
        Members of Congress, while our survivors are indeed
    liberated, they are not free from the scars of those
    atrocities. Everyone who has spent time in Guam has heard a
    personal account of what our people suffered. In fact, many of
    our survivors remember this day in 1944. They can still hear
    and feel the bombs exploding as American forces prepared to
    storm our beaches, and while dodging bombs which already seemed
    inhumane, it pales in comparison to the stories all Guamanians
    have heard.
        Guam suffered like no other place in America. Chamorros
    were raped, they were beaten, they were made slaves. They were
    forced to denounce the country they loved and swear allegiance
    to a country that was literally killing them, all the while our
    people remained loyal to the United States. They never lost
    hope that one day and soon America would return and spare them
    from the suffering and pain.
        These acts were done out of a deep and committed loyalty to
    the United States, and all throughout the occupation this
    loyalty is what gave our people hope. People were certain that
    the loyalty went both ways, and sometimes this hope is what
    kept our people alive; knowing that these horrible
    circumstances were only temporary.
        In fact, there was a famous song our war survivors sang,
    and when it was safe late at night at the end of every verse it
    was, and I quote, ``My dear Uncle Sam, won't you please come
    back to Guam.''
        The Japanese tried everything to break our resolve. They
    marched Chamorros to concentration camps, they became
    increasingly violent, and they murdered Chamorros at a more
    frequent rate with more mass casualties at a time. But despite
    their best efforts, many Chamorros survived until they were
    liberated, and sadly, although they survived the atrocities of
    war, most of them have been called by God to rest.
        That is why it is more urgent than ever to grant these
    claims. The time is now while there are still survivors left.
    Our people who lived are still loyal to the company despite 67
    years without any recognition for their suffering.
        Ladies and Gentlemen, Honorable Congressional
    Representatives, United States has an obligation to do this.
    Make no mistake about it. The Federal Government took upon this
    liability after it signed the Treaty of Peace with Japan in
    1951. Our people are not asking for something extraordinary. We
    are expecting the country we fought for, the country we
    suffered for, the country we died for to honor its
    responsibilities to our elderly, and this not just a statutory
    obligation, it is a moral obligation.
        Passing this legislation into law is a chance to
    demonstrate the importance of Guam. It is an opportunity to
    show we truly belong to this country. It is a definitive way to
    prove the mutual respect that we have for one another. During
    the war Chamorros loyalty to America was unwavering even in the
    face of death. All I am asking for is America to recognize this
    loyalty.
        Thank you for this opportunity, and I express my support
    for H.R. 44.
        [The prepared statement of Mr. Calvo follows:]

    Statement of The Honorable Eddie Baza Calvo, Governor, Island of Guam,
           on H.R. 44, The Guam World War II Loyalty Recognition Act

        Thank you, Chairman Fleming for inviting me to testify today. For
    the record, my name is Eddie Baza Calvo and I am the Governor of Guam.
    On behalf of our people, especially those who found themselves slaves
    during World War II, I would like to express my support for H.R. 44,
    also known as the Guam World War II Loyalty Recognition Act.
        Distinguished members of the House of Representatives, war claims
    for the people of Guam are long overdue. On December 8, 1941 our island
    was changed forever. As all of you know, that was the day Japan
    attacked my home. For nearly three years, those on Guam were forced out
    of their homes, were subjected to slavery, and suffered rapes and
    beatings. Tragically, many died at the hands of the Japanese Imperial
    Army.
        On July 21, 1944, what is now known as Liberation Day, American
    Marines and soldiers stormed Guam, and began a successful campaign to
    reclaim the island. It began as their tribute to the Chamorros and
    Americans who fought and died for our freedom. It was a celebration of
    our liberation from slavery and oppression. Over the years it's become
    a commemoration of the Greatest Generation. It is not simply a
    remembrance of war, but a celebration of what our community has become
    because of the freedom Chamorro and American warriors fought to give
    us. But, the Liberation of Guam should not become a dying memory just
    because that generation is nearly gone. Upon us is the great
    responsibility to celebrate our identity and traditions with pride.
        Every year, the entire island commemorates the bravery of these
    men, remembers their loved ones who survived our darkest time in
    history, and prays for those whose lives were stolen by war. Members of
    Congress while our survivors are indeed liberated, they are not free
    from the scars of these atrocities.
        Everyone who has spent time on Guam has heard a personal account of
    what our people suffered. In fact, many of our survivors remember this
    day in 1944. They can still hear the and feel the bombs exploding as
    American forces prepared to storm our beaches. And while dodging bombs
    already seems inhumane, it pales in comparison to the stories all
    Guamanians have heard. We have first-hand accounts from a generation
    who endured war and occupation, then rebuilt this island from the
    ground up. Sadly, there aren't many of them left to tell these stories
    to our children and grandchildren. There are new generations growing up
    without the special moments Guam's greatest generation shared with us.I
    firmly believe sharing some of them with you today will help you truly
    understand and appreciate my position. For your reference, there are
    more attached to this testimony, as compiled by Guam Senator Frank
    Blas, Jr.
    Father Jesus Baza Duenas
        Father Jesus Baza Duenas was born in 1911 and was the second
    Chamorro to be ordained a Catholic priest. He was one of only two
    Catholic priests that were allowed to remain on Guam during the
    Japanese occupation. Father Duenas was an outspoken voice of morality
    during that time, often expressing his opposition to the treatment of
    Chamorros to Japanese authorities.
        The Japanese occupiers believed Father Duenas knew the whereabouts
    of an American radioman who remained hidden on Guam: George Tweed. This
    paranoia turned out to be deadly for Father Duenas. On July 8, 1944, he
    was arrested. He was tortured for information on Tweed. Days later, the
    Japanese beheaded Father Duenas for his truthful silence.
    Dolores Jones
        The harsh reality of war also forced many children to suffer
    unimaginably. Dolores Jones was orphaned at 11-years old. She was
    forced to march to a concentration camp, like 18,000 others. That's a
    terrible situation for any child to deal with alone, but Dolores was
    also forced to act as a mother to her siblings.
        There was no shelter, latrines, food, or medicine at the
    concentration camp. It soon became apparent this was a death camp, and
    the Japanese soldiers were planning a massacre. According to one
    account, forty men were tied up and beheaded. Sadly, no records exist
    that detail how many people died at these concentration camps.
        Guam suffered like no other place in America. Chamorros were raped.
    They were beaten. They were made slaves. They were forced to denounce
    the country they loved and swear allegiance to a country that was
    literally killing them. All the while, our people remained loyal to the
    United States. They never lost hope that one day, and soon, America
    would return and spare them from the suffering and pain. As I've stated
    before, many died protecting American lives. These acts were done out
    of a deep and committed loyalty to the United States. All throughout
    the occupation, this loyalty is what gave our people hope. People were
    certain the loyalty went both ways. Sometimes, this hope is what kept
    people alive, knowing these horrible circumstances were only temporary.
    In fact, there's a famous song our war survivors sang, when it was
    safe, to help raise their spirits. And the end of every verse was:
        My dear Uncle Sam, won't you please come back to Guam?
        The Japanese tried everything to break this resolve. They marched
    Chamorros to concentration camps; they became increasingly violent;
    they murdered Chamorros at a more frequent rate, with more mass
    casualties at a time. It was what our country stood for that Chamorros
    so bravely defended in their defiance of the occupiers. As the rumors,
    arrests and the preparations for marches began on Guam on July 8, 1944,
    people were fighting for the very ideals we yearned for.
        But despite their best efforts, many Chamorros survived until they
    were liberated. Sadly, although they survived the atrocities of war,
    most of them have been called by God to rest.
        I'm sure many of you are aware of the strategic importance Guam and
    the Marianas played in defeating the Japanese Imperial Forces. The U.S.
    Department of Defense needed our tiny little islands, and arguably
    would not have recaptured the Pacific Theater without them.
        In this special relationship we've had with America for over a
    century, it has not always been the actions of the federal government
    that have pleased us. But it has always been the ideals of this
    country, and what it means to people yearning for freedom around the
    world, that we have always loved. It has always been the American
    serviceman and woman, who was willing to die for us, whom we have
    honored and respected for the freedom we have. It is this way because
    only 67 years ago we were those people yearning for freedom, given to
    us by those Marines and soldiers who came back for us, bled for us and
    died for us.
        It is more urgent than ever before to grant these claims. The time
    is now, while they're are still survivors left. Our people have lived,
    still loyal to this country, despite sixty-seven years without any
    recognition for their suffering.
        Ladies and gentlemen, honorable Congressional Representatives, the
    United States has an obligation to this--make no mistake about it. The
    federal government took on this liability after it signed the Treaty of
    Peace with Japan in 1951. Our people are not asking for something
    extraordinary. We are expecting the country we fought for, the country
    we suffered for, the country we died for, to honor its responsibilities
    to our elderly.
        This is not just a statutory obligation, it is a moral obligation.
    Passing this legislation into law is a chance to demonstrate the
    importance of Guam. It is an opportunity to show we truly belong to
    this country. It is a definitive way to prove the mutual respect we
    have for each other.
        During the war, Chamorros' loyalty to America was unwavering, even
    in the face of death. All I am asking is for America to recognize this
    loyalty.
        Thank you for the opportunity to express my support for H.R. 44.
    Edward L.G. Aguon passed away on September 28, 2007
        ``The most agonizing memories come to mind when I think of the
    occupation of being forced to watch people brutalized, tortured and
    killed, to see the look on their face when the final stab of the
    bayonet pierced their flesh, to hear the cries as their last breath
    leave their bodies. And even then, the attackers continued to thrust
    the bayonet into their lifeless bodies.''
        (On the March to Manenggon)
            ``Tens of miles in hot and rainy days, we were gathered like
            cattle being led to the slaughter. We could not help anyone who
            fell behind or fell down. Even if that person was your
            grandmother, a sick relative or a dying friend, you had to move
            on and leave them there.''
    Joseph Crisostomo Aguon 80 years old, Survivor
        ``I was forced to work at the airport... My job was to dig and
    sometimes carry water for the Japanese Soldiers. At the end of the day,
    we were getting a handful of rice as our payment... I was assigned to
    work in Canada, Barrigada as a mess boy... I was transferred to work in
    Ordot digging tunnels. If the Japanese were not satisfied, we were told
    to line up face-to-face and slap one another. When my turn came, I
    refused to slap the old man facing me. I was hit by the Japanese guard
    holding a stick. The man whispered, go ahead and slap me. I will
    understand.''
    Magdalena San Nicolas Bayani 94 years old, Survivor
        ``We were obligated to work. We worked in Ta'i and every morning
    we'd go through the swamp all the way up to Ta'i morning and night.
    We'd leave at 5 in the morning and return at 8 at night. All day, we'd
    plant, dig, gather rocks, and pull weeds. We'd rarely eat during the
    day. One day, we were told to stop work, stand in line and we stood
    there without knowing what was going to happen. We were warned that
    whomever whines, cries, or call out, we'd all be killed... There were
    three men who were standing there while some people were digging a hole
    in front of them. When the hole was dug, three Japanese with raised
    bayonets approached and told the men to kneel down with their hands
    tied behind their backs. They were told to bow their heads with their
    necks fully exposed. The three Japanese counted to three and the three
    were then beheaded right in front of us. The heads rolled down into the
    hole.
        ``One day, we were all standing facing the East. I didn't even know
    what we were doing. But, we were supposed to bow to the East, to the
    Emperor, the god of Japan, and the world, supposedly. I didn't bow
    quickly enough. I'll never forget. Nakase Sensei kicked me, slapped me
    first and then kicked me. Kicked my feet and I fell down.
        ``We would clean, pull grass, pull weeds, whatever. Bare hands. We
    had to feed ourselves with whatever we could bring from home... Later
    on, of course, I recall that they had a night shift. I don't recall
    what the night shift was for. But, we were all asked to bring our dogs
    to Tai. Later on, I found out that the Japanese were cooking dogs for
    the night shift.
        ``We were told to watch, or if we didn't watch, we would be next to
    suffer the fate of these three men...One of them was allowed to
    speak...He started to say the ``Our Father, who art in heaven...'' in
    Chamorro. Then they were pushed down to kneel. Three Japanese men,
    officers, with Samurai swords, each had water poured on the sword.
    Pushed the men down. Then he cut their heads off... I heard later that
    one of the Japanese officers took one of the heads and was giving it to
    the neighbors to cook it.''
    Teresa Reyes Borja 80 years old, Survivor
        ``They tied me to the coconut tree like a carabao or a cow. That's
    a very sad. And right now, like only a couple of months back when they
    tie me there for almost one day, they tie me to the coconut tree and
    they almost killed us. I hope to God people from Merizo so they can
    know what I'm saying and it's true. And it's very painful for me when I
    think about that. Only I know that the carabao and the cow are tied not
    the human being, but that time I was tied up for almost one day when
    I'm 12 years old.''
        ``It's a long story, and I think the people that came here today,
    what they say, it's true. And I don't want to say. It's a long story to
    say everything what the Japanese did to us, to me and all my family.''
    Rosa Roberto Carter passed away on April 11, 2010
        ``Most of us suffered wounds from being forced into the jungle,
    where we contacted scarring napalm from the United States bombing of
    the Japanese. When the bombing stopped, we were forced to go back to
    clearing bushes, which were dripping with this napalm. And in a proper
    setting, I could show you some scars, which have irritated me for 60
    years. One of my brothers lost parts of two fingers, as well, from the
    live ammunition scattered over so much of Guam after the fighting in
    1944. And at one time, I found myself clinging to a large breadfruit
    tree while American planes attacked.
        Human limbs, arms and legs, flew through the air on their own.
    People screamed in the grip of hysteria. I saw people going berserk.''
        ``In regard to the constant terror of being an occupied people,
    earlier in Mangilao, many of us were forced to line up in orderly rows
    to witness the beating of a family for the crime of trying to hide some
    of its food from the Japanese occupiers. If we showed any emotion, we
    would have been beaten too. ``
    Francisco Leon Guerrero Castro 79 years old, Survivor
        ``We then had the order for a forced march to concentration camp in
    Manenggon. Because of my father's fear of what the Japanese might have
    intended...One person that testified here, I also recollected that
    during the Japanese occupation, a Japanese national who was living in
    Guam, way before the war and during the war, had circulated the rumor
    when they started seeing Uncle Sam come back to Guam, she started
    circulating the rumor that when the Americans gets back to Guam, they
    won't find nothing but flies. That statement was very true.''
    Rosa Tenorio Castro 77 years old, Survivor
        ``If I did not march, they will kill me. Also, they will make me
    work in hot sun with no food and water and even though it's raining or
    not raining. It's a forced labor for a child. You don't have any
    democracy. There's no say so, ``I beg your pardon.'' ``Do it or else
    the end it be of you.'' In other words, they were very cruel to us
    Chamorros.''
        ``We went to Manenggon. Then, the marching on Manenggon, I thought,
    being a child, my understanding is only a child's understanding. But,
    now it's not. It's the opposite way around. What I heard as a child,
    that we were going to go to Manenggon, where there's a camp to be
    preserved from the American bombing. But, that is not true. They put us
    there so that the Japanese collect the Chamorro and give a big bomb.
    One bomb is enough for many people. That's what they intended to do.''
    Jose Quinene Cruz 63 years old, Survivor
        ``My only recollection from my grandmother and my father and my
    mother was one morning, when I was playing out in the rain, it was
    raining real hard and I told my mother, ``I wish God would stop this
    rain.'' She told me, ``Son, if the rain didn't stop, you would not be
    born.'' That's the only time when she spoke about the war. With further
    query, I said, ``Mom, why, what happened?'' She said, ``I was in a
    firing squad with Nana,'' my grandmother, ``and your father and two
    other siblings. We were there because when the taicho came,'' because
    my grandmother was the one who was massaging the taicho. Well, the
    taicho came and Nana was not there, they burned their house because
    they were out in the ranch. They burned their house. When they came
    back, they found out that their house was burned. Then, they were
    actually corralled to go to the river right next to where the Malesso'
    Church is. They were lined up to be killed. It rained and it rained and
    it rained. Because of the meticulousness of the Japanese, they actually
    did not kill them. My mom said we just slowly slipped out because they
    were enjoying themselves probably thinking that they'll kill them.''
        ``I come here because I think the deprivation that I feel is really
    the deprivation of some of our loved ones. My uncle would've probably
    gotten me really, really advancing with a confidence that he actually
    had to the family. He was killed because of his stature. He was killed
    because he was a tall man, he was a big man. I'm a big person and my
    father's smaller than I am. I always told him, ``Gee, if I only known
    Uncle Kin, I probably would actually measure up to him.''
        ``The atrocity that I bring is really the atrocity of being
    deprived of the memories of all of our heroes, all of my people, all of
    my elderly and all of the people who have merited. I close really with
    a nightmare that my mother-in-law and father-in-law actually had. That
    one, I vividly experience. When Pop is about 80, 79 years old, he was
    starting to have Alzheimer's. When he leaves the house, there was one
    time when it was really a heavy rain. I think it's part of the
    recollection of the war, Pop, we found him hiding under one of the
    bushes. We asked him, ``Pop, what are you doing?'' He said, ``The
    Japanese are coming.''... Those are memories of the living. But, the
    memories of the dead I carry. I carry the deprivation of the
    memories.''
    Rita Santos Cruz 72 years old, Survivor
        ``I was one person and I believe that there is no amount of money
    will ever equal the horror and pain of such an experience. We have not
    come to ask for money there is no value to suffering, hunger and cruel
    punishment and that no million will suffice to satisfy that indignity.
    We have not been acknowledged as a nation of people and also that we
    have suffered under the hands of the Japanese. Many have been raped,
    force to labor and I was forced to pick papaya and coconut for the
    Japanese. We marched to an area As Lucas in Talofofo. When we got there
    we saw a long and huge hole that was dug up but we had no idea what it
    was until my mother asked for a hug because the Japanese were suppose
    to kill us.''
    Barbara Castro Dela Cruz 76 years old, Survivor
        ``I witnessed the beheading of three Chamorro men, who the Japanese
    accused of spying for assisting the American George Tweed. During the
    execution, I was placed at the front row, a few feet away from the men
    who were to be killed. It was a painful experience because the Japanese
    threatened that anyone who looked away or showed any emotion during the
    execution would be next, saying we were witnessing our mirror that
    could be done to us as well.''
    Vicente Diaz Gumataotao 82 years old, Survivor
        ``Every day that I see Japanese, they'll beat me up. Either they
    wring my ear or they knock my head. But, they took us to be slave,
    forced labor, more likely, in a rice field, cornfield and potato, and
    sweet potato field; they worked 12 hours a day. Out of 36 of us, I
    really feel sorry for those 35 because I'm the only survivor.'' ``There
    was a lot of atrocities and I witnessed a lot of things that were
    happening in Guam, like the Late Frank Won Pat, when he was beheaded at
    Pigo', I was there, it was the first person that was beheaded by
    digging his own grave and they won't waste a bullet for him to be
    killed. He had to be beheaded by a sword.'' ``At Orote Point, the food
    that we eat over there is 50% worm and 50% rice. It's all rotted rice.
    We have to eat because we're starving.'' ``I asked for my machete back,
    they beat me up until I was unconscious. When I got up, I don't even
    know where I'm at. That's the worse experience I ever had. It's a
    horrible experience that I have been through. But I'm not the worst.
    There are a lot of people here that are worse than I am.''
    Concepcion Judicpa 66 years old, Survivor
        ``Although I did not put in my testimony, I would like to, and
    maybe I will revise that later, but, in my testimony, my sister, up to
    this point, my sister's only about 80 pounds. It's because she lived
    during those days. She had, like all the other testimonies, there was
    malnutrition and so on. I, when I got married, I was only 85 pounds.
    Thank God I had five kids and was able to gain some weight. But, I
    believe that was as a result of the times when there was hardly any
    food to go around.''
    Pilar Diaz Cruz Lujan 79 years old, Survivor
        ``I was 11 years, 2 months old on December 8th, 1941. The mass of
    the Immaculate Conception was just celebrated in the Santa Cruz Church
    in Agana. As we were coming out of the Church, we heard and saw planes
    overhead. Instantly, we waved and cheered as if we were watching an
    aerial show. Little did we know that those same planes had bombed
    Sumay... That was the end of the peaceful island paradise of Guam. A
    few days later, the people of Guam were captured by the Japanese and
    that was the beginning of the reign of terror that was forced upon the
    inhabitants of Guam.''
        ``As far as I'm concerned, the trauma and the lasting negative
    psychological impact of the people cannot be measured... The point is,
    the physical scars can never measure up to the fear that I carry today,
    even as old as I am now. The subject of war experience is not a subject
    that is easily passed on from one generation to the next. It is painful
    and horrifying experience that many people want to discuss, but most
    are unable to express without outward signs of emotional release.''
    Maria Santos Martinez 83 years old, Survivor
        ``I was 14 years old when the Japanese came on Dec. 8, 1941. When
    the Japanese came, they made us run into the jungle right near St.
    Johns. Our family hid there and it was so dark and we couldn't find
    each other because we were near a cave by St. John's. In the morning,
    my father left us to cut his tuba and when he climbed down from the
    coconut tree, he saw a battalion of Japanese coming from the direction
    of Gun Beach. They stopped at the house of my aunt and found a young
    woman by the name of Maria Camacho whom they dragged out and raped.
    They held onto her father and while a bayonet was pointed at him, the
    battalion took turns on the young woman. My father ran back to us in
    the jungle and told us about what he saw.''
        ``Every morning, the Japanese would send us off to work. When I
    didn't work, would then be told to make sure to clean my neck because I
    would be cut off at the neck if I didn't' work. I would always cry out
    of fear. I would tell my mother that I didn't feel like working because
    I was always so hungry and sick but a Japanese would always remind me
    that if I refused, I would be killed by being beheaded.''
        ``When the American planes came they would shoot at us from the air
    because they thought we were the Japanese. We would all run into the
    jungle where we'd pray the Lord's Prayer. We even tried sticking our
    heads into holes in the ground out of our fear of being hit. When my
    companions become thirsty and they ask to drink, the Japanese would
    then take their guns and hit them with it.''
    Lucia McDonald 83 years old, Survivor
        ``Once the Japanese soldiers found out through the interpreter that
    our father was an American Navy man, they tortured us on a daily basis.
    We would get punched, kicked and poked by bayonets and a head choke. On
    one occasion, my three brothers were in prison and beaten badly. One
    brother was beaten so badly on his leg that when they release him
    months later, he could not walk anymore.''
        ``We had to hide our food so we wouldn't get beaten. On one of our
    work days, we were forced to circle around and witness the execution of
    three men. One was beheaded and the others shot. We were told not to
    cry or yell or else we also would be killed.''
        ``I was afraid to report to the fields because of the plane
    dogfights that morning. The next day, along with three other girls, we
    were escorted and questioned about our accidents at the field that day.
    I was slapped repeatedly and a sword was placed on my shoulder. The
    interpreter told me that I was going to be killed if I lied about my
    absence. I begged for my life. Later, he asked if I wanted to be
    drowned in the big drum of a container of water. Two girls were told to
    clean the wounds of the Japanese soldiers. One girl was taken into the
    sleeping quarters of the Japanese official and I was told to grind
    coconut for the soldiers. Three of us were released that night. One
    girl, who was taken into the sleeping quarters was kept there for a
    couple of days before they returned her home. But, then her father hung
    himself because he could not bear to see his daughter suffering and
    what she went through.''
    Dolores Cruz Meno 78 Years Old, Survivor
        ``There's two of us girls, because I was so fragile, I was so
    skinny. My parents are very poor, I am the youngest one in the family.
    So, there's two of us girls to carry that with the bamboo. We put the
    bamboo on the basket, we slid it into the farthest part of the basket
    and we carry it on our back out to the Manganese to deliver it to the
    Japanese people for their supplies. We do not have anything for us.
    They all get it for themselves.''
    Manuel Mafnas Merfalen 82 years old, Survivor
        ``One morning, we were visited by a few Japanese and an interpreter
    and the Commissioner of Dededo... They introduced themselves to be the
    representative of the police, and the reason for their being there was
    because of my sister being married to an American Navy man... So the
    question went on repeatedly to my sister, and my sister was only giving
    them negative answer. Each time they're not satisfied with the answer,
    it was followed with a blow in the face, not with the palm open, but
    with the fist closed, to my sister's face every time she gave a
    negative answer. This went on for almost an hour, and they finally
    decided to leave, leaving my sister with a puffy face, bleeding through
    the mouth and nose...And then the following day, the same people came,
    informing my mother that we have to deliver my sister down to the Agana
    police station for more investigation...They were tying up her hands in
    front of her, and there was a chair just before her and she was told to
    get on the chair. So they strung up my sister to the beam of that
    building and I watched her dangling on that rope... Every time she gave
    an answer, it was followed with a whip, about a yard long whip, instead
    of a beating with the hand. I can see through the window flashes of
    blood. Her dress is soaked with blood. She wasn't crying, but I can see
    tears dripping through her face... When I was watching through the
    window, they poured this container of liquid over her head, then she
    started screaming. And what it was, it's not water, but it's gas. I can
    smell the fume of that gas coming out through that window from a
    distance of maybe 15 feet. So I started moving away from the building.
    I was crying. As far as I can go from 100 feet away, I can still hear
    my sister yelling.''
        ``We were on an ammunition and supply detail for some command in
    Mangilao for the military and, at the time, there was a plane flying
    over us. We were told to disperse with what we have on our shoulder
    into the jungle. My brother, being a heavy smoker, he took out his
    cigarette and light it, and momentarily when the supervisor of that
    crew saw the light, he yelled at one end of the group of people where
    we were and, in no time, he was there already yelling at my brother. I
    couldn't help watching him, what he was going through, and he was
    brutally kicked, hit with a stick, knocked down unconsciously... And at
    that time, they tied my brother's arm and dragged him behind a horse,
    and that was the last time I see of him.''
    Lourdes Laguana Perez 80 years old, Survivor
        ``I watched my aunties, my father's sisters whipped when their
    three kamas were lost when they were going out. So, the Japanese
    rounded up all the old people first. They started whipping them. The
    Japanese were taking turns whipping the old people first. They were
    very strong because they started first. Then, when they went to the
    younger people, they were kind of weak. But, I watched my aunties cry
    but they have to hold their breath because if they cry more, or if we
    cry because I watch them, you'll get beaten more and you'll get
    whipping more.''
    Jose Afaisen Pinaula 79 years old, Survivor
        ``I have suffered painful burn to both of my hands that lasted at
    least three days, then I was assigned to keep the diesel oil torchlight
    burning all night. I became nervous wreck. My morale was at its lowest
    breaking point. I was frightened and scared for my life, that I did
    anything the Japanese soldier just to survive and be alive. Forced to
    work, even if I was extremely ill, there was absolutely no excuse not
    to work, unless you on the verge of dying. I reach a breaking point in
    my life when I did not care what happened to me. ``
    Roman Leon Guerrero Quinata, Sr. 80 years old, Survivor
        ``Up to now, I do not understand why the animosity and suffering
    imposed on us by Japanese. Imagine, I was only 12 years old, with no
    knowledge and experience of hard labor. I was made to do all these
    things. I was forced to work in the rice field, after several month of
    schooling. But, of course, the Japanese ambition is not to educate us,
    but to force us to do hard work, hard labor for their interest in
    combating this war. No matter what it takes, no matter what it costs,
    as long as their interest is served sometimes I ask myself, ``What have
    we done to make them hit us so much?'' The Chamorros are a loving and
    generous people. They don't even respect the elderly. My mother
    recently had a baby, was forced to work in the rice field.
    Incidentally, the baby that was born just before the war, died during
    the war, after contracting pneumonia. Nothing matters to them.''
        ``I will summarize this ordeal as one that I will never forget. The
    pain, the suffering, the hunger and the beating is beyond my
    expectation. I am praying that it will not happen again, and none of my
    kids or grandkids will ever experience what I have gone through.''
    Cristobal Reyes 68 years old, Survivor
        ``While at Fenna, he worked for the Japanese in the field crops. It
    was shortly after my father had to move to Fenna when he was made aware
    that the Americans were on their way to Guam. This alerted the Japanese
    and started ridding the islands of as much Chamorros as they can, so
    that it will help weaken the attack against them whenever it was to
    take place. This is what led to the massacre of Fenna. On one
    particular morning, all the people were gathered to go into several of
    the caves that were existed there. My father was in one of them. He was
    later called out by the Japanese to collect firewood and barks of trees
    to place in front of the cave. Up to this time, there was no mention or
    notice of machine gun position to fire directly in front of the cave.
    He witnessed the first cave was being set on fire at the entrance, and
    then was followed by shootings.''
    Regina Reyes 95 years old, survivor
        ``In 1941, when we heard that the Japanese is in Hawaii, we're to
    get away in the house. We stay there all day until four o'clock. I go
    to my other house. Since I just got in my house, they got in with gun
    and shiny bayonet. He asked me--I don't know what to say about this,
    pointed the gun, and I said, no, I don't have. And then he just pushed
    me on the wall and do what he want. He raped me.''
    Elvina Reyes Rios 81 years old, Survivor
        ``I was made to work by the Japanese. I was only 13 years old at
    the time. I was living in Agat with my parents. I was made to work in
    the rice field. I was made to work in Piti planting rice. I worked in
    the village of Agat to be in the garden. I was made to work in
    Jalaguag. The damage on my back is still there because when I was busy
    clearing land and I would stretch my body, the Japanese would throw
    rocks at me. It is still there on my back... I'd get to Fena at 6 in
    the morning and if I was late at least one minute, I would get one slap
    on my mouth. For three minutes, it was three slaps on my mouth. When I
    am done in Fena, I would grate 125 coconuts. I would get off at 6 pm
    and by the time I got home to the ranch at 9 at night.''
    Francisco Perez Sablan 69 years old, Survivor
        ``My father was beaten up and was punished, brutal. They hit him
    with sticks and they break almost every bone in his body. My mother,
    they grabbed me from my mother, they threw me in the fire. They slapped
    my mother. They kicked my mother. Now, I got about maybe 15% or 30% of
    my back body burned. So, I'm just here today to tell you that it's a
    hard life, to grow up with no parents, no father, no mother. I didn't
    even finish my education because I have nobody to support me in my
    education. I grew up eating bananas, breadfruit, taros, lucky if I eat
    spam or corned beef in a month or week. It's a hard life.''
    Jesus Perez Sablan passed away on May 21, 2010
        ``We arrived in Manenggon without water, food or shelter. We
    hurriedly installed a lean-to temporary shelter using vegetation
    branches for our bedding. Believe me, war is hell. How I managed to
    journey, to complete the journey, with my partially crippled dragging
    my leg with eventual healing was a mystery. Could only attribute it to
    faith, the will to survive, and, more importantly, the will of God. And
    I swear, that the above remarks were the whole truth and nothing but
    the truth, so help me God.''
    Vicente Taitingfong Taisipic 73 years old, Survivor
        ``They gave me a bucket to patrol the whole area of Yona and
    collect manure, irregardless what kind of manure. And they gave me a
    quota that, if I don't fill up six buckets during the field, that I
    would be beaten up. Practically, I was a walking maggot because, the
    fact of the matter is, that after the field work, I had to walk all the
    way from the school compound down to Asinan Valley. That's where our
    ranch is located at. And my parents normally told me to go directly to
    the river, stay there with the other carabao or water buffalo. And at
    that time, soap is a luxury for us. We used lemon leaf for soap so I
    could get rid of the flies that had been following me from the field
    that I would be beaten up.''
        ``The Japanese sergeant told me and a few others to round up all
    the dogs. At that time, I was under the impression they're supposed to
    eat it, but they behead it. And the one time, I came so close to at
    being cut by a Japanese sword. And then the dog, more or less, trying
    to reach and I reached over to grab it, hold it back, and then the
    Japanese soldier, cut him in half. Then he started laughing at me, and
    then, at the same time, I was bloody all over, then he started getting
    mad at me that I wasn't doing my job holding the dog down.''
    Arthur B. Toves 81 years old, Survivor
        ``One afternoon, he ordered me and said to me, ``Get one shovel and
    go to the cemetery and dig this hole for two.'' I did that because it's
    very soft, sandy part. I finished what they told me to do. I hid under
    the banana tree and wait for them. Sooner or later the truck came with
    the two local prisoners and the mother. They followed behind the car
    with the two Japanese, armed with swords and .45 pistol. When they got
    into the cemetery, they tied the hands of the prisoners. They ordered
    them to kneel down, face one another. ``Look down at the hole and bend
    your neck.'' Ladies and gentlemen, sooner or later, that sword was
    flying, whacking the neck. One was next to the lady, the other was not,
    because they used the .45 to kill the guy. But, what makes me feel so
    bad that day, is that the mother was standing right next to the grave,
    watching all the things that being done to her son. I feel so bad, but
    I cannot do anything, or else, I'll be in the hole also.''
        ``My father [was] still in prison. They came to the ranch, armed
    with bayonets, looking for anything to prove that we are spy. They
    didn't find anything. They brought us to Agana, my two oldest brothers,
    my two oldest cousins and myself. They bring up the recent account. My
    father was on top of that. Nine o'clock in the morning, I noticed the
    executioner in the window... When he came out, he let us stand, all of
    us five, attention. He touches my brother's neck, the oldest one. He
    said, ``This is no good because this is kind of hard.'' Going down the
    line, they came to me. He touches my neck and exactly, this is what he
    said, ``This is very good.'' One time, meaning to say the sword would
    just go through all the way because I was the youngest one.''
    Juan Martinez Unpingco passed away on August 10, 2010
        ``We seldom go to the other village and to Agana because we were
    afraid that we might meet Japanese soldier who were so mean and brutal.
    I have seen them slap our people with them and even stab people to
    death with their bayonet. They were ruthless and they have no regards
    to the value of human life. Then one day the Japanese soldiers came to
    our ranch destroying things and terrorizing us. We were so scared,
    especially when the same soldier rape my auntie Margaret.''
        ``One day the Japanese soldier armed with rifle and an interpreter
    telling to forcing us to march to Manenggon concentration camp... If
    you stopped to rest, you'd be whipped and beat. These were the march
    when my father, got whipped--oh boy he was really whipped had no
    reason, apparent reason. He was whipped with tangantagnan stick five
    feet long, one inch thick, my dad was whipped so severely until his
    body was swollen, lacerated, covered with matted blood and bruises. The
    beating took so long, so the soldiers took turns beating him. When the
    beating was finished, my father went to the nearby river and soaked his
    wounds for two hours to lessen the pain, swelling and bleeding.''
        ``Our people, as well as my family, endured so much hardship, pain
    and agony and torture. There are times I have nightmare remembering the
    suffering and torture and the killing that I witnessed as a young man.
    I still remember the mangled bodies with worms and flies feeding
    them.''
                                     ______

        Mr. Landry. Thank you, Governor. The Chair would now like
    to recognize Mr. Pula for five minutes.

    STATEMENT OF NIKOLAO PULA, DIRECTOR, OFFICE OF INSULAR AFFAIRS,
                    U.S. DEPARTMENT OF THE INTERIOR

        Mr. Pula. Mr. Chairman and Members of the Subcommittee,
    thank you for the opportunity to discuss the Guam World War II
    Recognition Act.
        It has been nearly 70 years since Imperial Japanese
    military forces invaded and occupied Guam, subjecting its
    residents to 33 months of horrific pain and death. Through it
    all, however, the largely native population, the Chamorro,
    remained ever loyal to the United States. In a monumental
    operation the United States ground forces surrounded the
    beaches of Asan and Agat on June 21, 1944. Although our forces
    experienced fears of battles throughout the Pacific, what they
    found and learned of Guam's occupation by the Japanese was
    shocking. Fellow Americans, innocent civilians were subject to
    summary executions, beheadings, rape, torture, beatings, forced
    labor, forced march and internment. Approximately 1,000 had
    died due to the brutality of the Imperial Japanese occupation.
        No U.S. state or territories suffered as bitter a fate
    during World War II as did Guam.
        Cognizant of the dire straits of the people of Guam, the
    U.S. Congress passed the Guam Meritorious Claims Act in
    November 1945, just after the surrender of Japan. The U.S.
    Government later granted relief to certain residents of other
    areas occupied by Imperial Japanese military forces. Guam was
    not included in this subsequent legislation under the mistaken
    belief that Guam residents had already been compensated.
        For nearly 30 years, beginning in the 1970s, Guam delegates
    to Congress introduced legislation regarding war claims. It was
    not until 2002 that the Guam War Claims Review Commission Act
    became public law. Congress had instructed the Commission to
    determine whether there was parity of war claims paid to the
    residents of Guam under the Guam Meritorious Claims Act as
    compared with awards made to other similarly affected United
    States citizens or nationals in territory occupied by the
    Imperial Japanese military forces during World War II.
        The Commission met on numerous occasions, held lengthy
    hearings in both Guam and in Washington, and exhaustively
    analyzed relevant information and materials before committing
    its collective judgment to paper in its 2004 report. The
    Commission carefully stated 32 findings and developed six
    recommendations for the Congress, including $25,000 for
    eligible survivors of Guam residents who died, $12,000 for
    personal injury, including rape, malnutrition, forced labor,
    force marching and internment to each person who personally
    suffered any of these harms or to the eligible survivors, and
    establishment of a trust fund for research, education, and
    media to memorialize the events of the occupation and the
    loyalty of the people of Guam.
        Legislation which drew from the report has passed the House
    of Representatives on several occasions beginning with the
    109th Congress. However, it has failed to receive the support
    that would see it through to the enactment that we believe it
    deserves. As Congress is aware, Guam is vital to the protection
    of American interests. The United States has plans to move
    about 8,000 Marines, including their dependents from Okinawa to
    Guam. Many hope that the passage of the Guam Loyalty
    Recognition Act would show goodwill on the part of the Federal
    Government and would act as reciprocity for the goodwill and
    loyalty of the people of Guam have always exhibited and will
    exhibit by hosting the enlarged military presence.
        The Obama Administration, through the Department of the
    Interior, strongly supported enactment of the Guam World War II
    Loyalty Recognition Act in the 111th Congress, and we continue
    to offer our strong support for these provisions. Enactment of
    H.R. 44 would restore the dignity lost during occupation and
    heal wounds bound in the spirits of those who survived.
        Thank you for the opportunity to testify.
        [The prepared statement of Mr. Pula follows:]

    Statement of Nikolao I. Pula, Jr., Director, Office of Insular Affairs,
      U.S. Department of the Interior, on H.R. 44, The Guam World War II
                            Loyalty Recognition Act

        Mr. Chairman and Members of the Subcommittee on Fisheries,
    Wildlife, Oceans and Insular Affairs, thank you for the opportunity to
    discuss H.R. 44, the Guam World War II Loyalty Recognition Act.
        It has been nearly 70 years since Imperial Japanese military forces
    invaded and occupied the United States territory of Guam, subjecting
    its residents to 33 months of horrific pain and death. Through it all
    however, the vast majority of the largely native population, the
    Chamorro, remained ever-loyal to the United States. In prayer and song,
    many longed for the return of the Americans.
        In a monumental operation, United States ground forces stormed the
    beaches of Asan and Agat on June 21, 1944. It took nearly two months to
    dislodge a well-hidden enemy, but Guam was finally secured on August
    10, 1944. Although our forces experienced fierce battles throughout the
    Pacific, what they found and learned of Guam's occupation by the
    Japanese was shocking. Fellow Americans, innocent civilians, were
    subjected to summary executions, beheadings, rape, torture, beatings,
    forced labor, forced march and internment. Approximately 1,000 had died
    due to the brutality of Imperial Japanese occupation. No U.S. state or
    territory suffered as bitter a fate during World War II as did Guam.
        Once Guam was secured, its residents were overwhelmingly thankful
    that their prayers had been answered, and conversely, our grateful
    nation had immense admiration for them and the pain and suffering they
    had endured. Cognizant of the dire straits of the people of Guam, the
    United States Congress passed the Guam Meritorious Claims Act in
    November 1945, just after the surrender of Japan,.
        The U.S. Government later granted relief to certain residents of
    other areas occupied by Imperial Japanese military forces. Guam was not
    included in this subsequent legislation under the mistaken belief that
    Guam residents had already been compensated by Congress. While the Guam
    relief recipients were appreciative, over the years it became evident
    that they may not have received treatment equivalent to that later
    given to Americans in other areas occupied by Japanese forces.
        For nearly 30 years beginning in the 1970s, Guam Delegates to
    Congress introduced legislation regarding war claims. It was not until
    December 10, 2002 that the Guam War Claims Review Commission Act became
    Public Law 107-333. Pursuant to the Act, the Secretary of the Interior
    appointed the Commission's five members, all of whom had experience
    relevant to the task at hand.
        Congress had instructed the Commission to ``determine whether there
    was parity of war claims paid to the residents of Guam under the Guam
    Meritorious Claims Act as compared with awards made to other similarly
    affected United States citizens or nationals in territory occupied by
    the Imperial Japanese military forces during World War II....''
        The Commission met on numerous occasions, held lengthy hearings
    both in Guam and in Washington, and exhaustively analyzed relevant
    information and materials before committing its collective judgment to
    paper in its 2004 Report on the Implementation of the Guam Meritorious
    Claims Act of 1945. The Report is indeed comprehensive. The Commission
    carefully stated 32 findings and developed six recommendations for the
    Congress.
        Included in the recommendations are:
          $25,000 for the eligible survivors of Guam residents who
    died during the Japanese occupation, which amounts to approximately $25
    million for approximately 1,000 deaths;
          $12,000 for personal injury, including rape,
    malnutrition, forced labor, forced march, and internment (including
    hiding to avoid capture), to each person who was a resident of Guam
    during the Japanese occupation and who personally suffered any of these
    harms, or to the eligible survivor(s) of such individuals, which
    amounts to approximately $101 million for the entire 1990 census
    population of Guam; and
          Establishment of a trust fund for scholarship, medical
    facilities, and other public purposes for the benefit of the people of
    Guam and for research, education and media to memorialize the events of
    the occupation and the loyalty of the people of Guam.
        Legislation, which drew from the report, has passed the House of
    Representatives on several occasions beginning with the 109th Congress.
    However, it has failed to receive the support that would see it through
    to the enactment that we believe it deserves.
        As Congress is aware, Guam is vital to the protection of American
    interests in Asia and the Western Pacific. The United States since 2000
    has been building up its military forces on Guam, and has plans to move
    about 8,000 Marines and their dependents from Okinawa to Guam as part
    of a bi-lateral agreement with Japan. Many hoped that passage of the
    Guam World War II Loyalty Recognition Act would exhibit good will on
    the part of the Federal government and would act as reciprocity for the
    good will and loyalty the people of Guam have always exhibited and will
    exhibit by hosting a large military presence.
        The Obama Administration, through the Department of the Interior,
    strongly supported enactment of the Guam World War II Loyalty
    Recognition Act in the 111th Congress, and we continue to offer our
    strong support for these provisions. Enactment of H.R. 44 would restore
    the dignity lost during occupation and heal wounds bound in the spirits
    of those who survived. For the thousand who passed by saber or savagery
    their memory remains in stories of principle, courage, and sacrifice.
        The Island of Guam has undergone tremendous change since World War
    II, and that change will continue as its strategic value is realized in
    the 21st Century. The opportunity to reach back and provide equity,
    parity, and justice is manifested in the Guam World War II Loyalty
    Recognition Act.
                                     ______

        Mr. Landry. Thank you. The Chair would now like to
    recognize Mr. Tamargo. You are recognized for five minutes.

    STATEMENT OF MAURICIO TAMARGO, FORMER CHAIRMAN, GUAM WAR CLAIMS
       REVIEW COMMISSION, FORMER CHAIRMAN, UNITED STATES FOREIGN
                      CLAIMS SETTLEMENT COMMISSION

        Mr. Tamargo. Thank you, Mr. Chairman, Ranking Member,
    Members of the Committee, for the opportunity to appear before
    you today to speak about the work of the Guam War Claims Review
    Commission.
        My name is Mauricio Tamargo. I had the distinct honor of
    serving as the Chairman of the Review Commission and I served
    with a very talented and knowledgeable group of fellow
    commissioners and staff. For the sake of brevity, I am
    summarizing my remarks.
        The Review Commission was an advisory body established by
    the Secretary of the Interior pursuant to the Guam War Claims
    Review Commission Act enacted in December of 2002. The Review
    Commission was established to determine whether there was
    parity of war claims paid to the residents of Guam under the
    Guam Meritorious Claims Act as compared with awards made to
    other similarly affected U.S. citizens or nationals in
    territories occupied by Imperial Japanese military forces
    during World War II, and to advise on any additional
    compensation which may be necessary to compensate the people of
    Guam for death, personal injury, forced labor, forced march and
    internment suffered at the hands of the Japanese forces during
    the occupation.
        Guam was a U.S. territory when Japanese forces attacked it
    on December 8, 1941. Two days later, on December 10th, the
    Japanese overran and occupied the island. What followed was a
    period of 32 months of cruel, brutal and barbaric oppression of
    the people of Guam by the Japanese occupation forces. Great
    numbers of islanders were beaten. The Commission found that
    great numbers of islanders were beaten and whipped and many of
    the women were raped. There were numerous beheadings. In the
    last months of the occupation nearly all of the islanders were
    subjected to force labor and forced marches and herded into
    concentration areas including the elderly and the very young,
    causing them to suffer acutely from malnutrition, exposure, and
    disease.
        The Review Commission found that U.S. forces began the
    liberation of Guam on July 21, 1944, and the United States
    declared Guam secure on August 10, 1944. We also found that the
    Navy immediately began organizing the island as a base from
    which the U.S. intended to launch air and sea attacks in the
    direction of Japan. The U.S. Navy also devoted as much material
    and effort as it could spare to constructing shelters and
    providing assistance to the residents of Guam. Housing and
    shelter was scarce on Guam not just because of the combat
    fighting between the U.S. and Japanese forces, but also because
    many of the residents were being displaced by the ever-
    increasing build up of U.S. forces on the island. The task of
    both acquiring all necessary lands for U.S. forces and for
    providing monetary relief for damages to the residents of Guam
    was undertaken by the Navy's Land and Claims Unit, which later
    became the Navy's Land and Claims Commission.
        As the first word in both organization's titles implies,
    the Navy's priority was acquiring all the necessary land on the
    island needed by the military for the war effort, not attending
    to the claims of the residents of the island. To a great
    extent, this is understandable as the U.S. was still engaged in
    a very serious war effort.
        The Review Commission report acknowledges that the Navy's
    efforts on behalf of the residents of Guam was admirable.
    However, the Review Commission also noted that the two missions
    of the Land and Claims Commission were at cross purposes
    because while the Navy was trying to inform the residents of
    Guam of their right to file a claim, and while it was trying to
    provide them with shelter and housing, the Navy was also
    displacing much of the population of Guam.
        Ultimately the Navy grew to occupy 75 percent of the
    island. Within weeks after the termination of hostilities on
    Guam, the Congress enacted the Guam Meritorious Claims Act of
    1945. In addition to providing other authorizations, this Act
    directed the Navy to provide immediate relief to the people of
    Guam in the form of monetary payments.
        In undertaking its tasks, the Review Commission conducted
    research, extensive research on the administration of the Guam
    Meritorious Claims Act of 1945 by the Navy's Land and Claims
    Commission, comparing that claims program to other claims
    programs conducted pursuant to other acts of Congress.
        The Review Commission also conducted hearings on Guam and
    in Washington, D.C. Finally, the Review Commission submitted
    its report to the Secretary of the Interior and to specified
    congressional committees summarizing our findings and our
    recommendations. The Review Commission, as detailed in our
    report, found that the Navy's Land and Claims Commission
    administered pursuant to the Guam Meritorious Claims Act of
    1945 was significantly flawed and fell short on a number of
    important counts when compared to the claims programs provided
    to the residents of other U.S. territories.
        The most significant of the flaws of this claims program
    was the poor public notice given to the residents of Guam and
    to the short opportunity for residents of Guam to file claims
    in the claims program. The Review Commission also found, and I
    would like to now make special mention of the fact that the
    residents of Guam during the Japanese military occupation
    exhibited great courage and loyalty to the United States in
    case of extreme hostility, and they did it at a time when the
    outlook for the U.S. prevailing in the war was far from
    assured.
        In conclusion, the five commissioners who served on the
    Review Commission came from different points of view and
    different backgrounds, as well as from both political parties,
    and yet we came to the findings and recommendations
    unanimously. I stand by these findings and recommendations and
    continue to believe strongly that they should be implemented.
        I would also like to say that those of us who came to the
    Review Commission from the Foreign Claims Settlement Commission
    were pleased to have had the opportunity to use our familiarity
    and expertise regarding war claims issues to assist in this
    important work.
        Mr. Chairman, this concludes my statement and I am happy to
    respond to any questions that you and the Ranking Member may
    have. Thank you.
        [The prepared statement of Mr. Tamargo follows:]

    Statement of The Honorable Mauricio J. Tamargo (Ret.), Partner, Poblete
    Tamargo, LLP, Former Chairman, Foreign Claims Settlement Commission of
        the United States, and Former Chairman, Guam War Claims Review
     Commission, on H.R. 44, The Guam World War II Loyalty Recognition Act

        Chairman Fleming and Members of the Subcommittee, thank you for the
    opportunity to appear before you today to speak about the work of the
    Guam War Claims Review Commission.
        My name is Mauricio Tamargo, and I was the chairman of the Foreign
    Claims Settlement Commission at the Department of Justice from 2002 to
    2010, and I was also chairman of the Guam War Claims Review Commission
    (Review Commission) until June 9, 2004 when the Review Commission
    completed its work.
        The Review Commission was an advisory body established by the
    Secretary of the Interior under the Guam War Claims Review Commission
    Act, Public Law 107-333, enacted in December 2002.
        I had the honor of serving on the Review Commission with a very
    talented and knowledgeable group of individuals including the Vice
    Chairman of the Review Commission, the late Hon. Antonio Unpingco,
    former Speaker of the Guam Legislature, the Hon. Robert J. Lagomarsino,
    former Member of Congress from Ventura, California, the Hon. Benjamin
    J. Cruz, former Chief Justice of the Guan Supreme Court-now a Senator
    in the Guam legislature, and Mrs. Ruth Van Cleve, a former career
    senior executive in the Department of the Interior, and Mr. David
    Bradley, the Executive Director and the rest of the Review Commission
    staff.
        The Review Commission was established to ``determine whether there
    was parity of war claims paid to the residents of Guam under the Guam
    Meritorious Claims Act as compared with awards made to other similarly
    affected U.S. citizens or nationals in territory occupied by the
    Imperial Japanese military forces during World War II'' and to ``advise
    on any additional compensation that may be necessary to compensate the
    people of Guam for death, personal injury, forced labor, forced march,
    and internment'' suffered from the Japanese occupation of the island
    during the war.
        The island of Guam, was a U.S. territory when it was attacked by
    Japanese forces on December 8, 1941. Guam was attacked on the same day
    as the attack on Pearl Harbor occurred, but this attack happened on the
    other side of the International Date Line. Two days later, on December
    10, 1941, the Japanese overran and occupied the island. What followed
    after that was a period of 32 months of cruel, brutal, and barbaric
    oppression of the people of Guam by the Japanese occupation forces.
    Great numbers of the islanders were beaten and whipped, and many of the
    women were raped. There were numerous beheadings and, in the last
    months of the occupation, nearly all of the islanders were subjected to
    forced labor and forced marches and herded into concentration areas,
    including the elderly and very young, causing them to suffer acutely
    from malnutrition, exposure, and disease.
        The Review Commission found that after beginning the liberation of
    Guam on July 21, 1944, the United States forces declared Guam secure on
    August 10, 1944, and immediately began organizing the island as a base
    from which the U.S. intended to launch air and sea attacks in the
    direction of the Japan, the Japanese homeland. At the same time, the
    U.S. Navy devoted as much material and effort as it could spare to
    constructing shelter for the local citizens.
        Housing and shelter was scarce on Guam not just because of the
    combat fighting between U.S. and Imperial Japanese forces but also
    because many residents were being displaced by the ever increasing
    build up of U.S. forces on the Island. The task of both acquiring all
    necessary land for U.S. military forces, and providing monetary relief
    and damages to the residents of Guam was undertaken by the Navy's
    ``Land and Claims Unit'', which later became the Navy's ``Land and
    Claims Commission'' when the Congress enacted legislation. As the first
    word in both organizations title implies, the Navy's priority was
    acquiring all the necessary land on the Island needed by the military--
    not attending to the claims of the residents of the Islands. To a great
    extent this is understandable as the U.S. was still engaged in a very
    serious war effort.
        The Review Commission's Report acknowledges the Navy's efforts on
    behalf of the residents of Guam as admirable. However, the Review
    Commission also noted that the two missions of the Land and Claims
    Commission were not aligned and in fact were at cross-purposes.
    Because, while the Navy was trying to inform the residents of Guam of
    their right to file a claim and trying to provide them with shelter and
    housing, the Navy was also displacing much of the population of Guam.
    Ultimately the Navy occupied seventy-five percent of the Island.
    Leaving a mere twenty-five percent for the population of Guam to
    inhabit.
        With-in weeks after the termination of hostilities in Guam, the
    Congress enacted the Guam Meritorious Claims Act of 1945. In addition
    to providing authorizations, this Act directs the U.S. Navy to provide
    ``immediate relief' to the people of Guam. This directive included
    providing monetary payments to the people of Guam.
        In undertaking its task, the Review Commission conducted research
    on the administration of the Guam Meritorious Claims Act by the Navy's
    Land and Claims Commission, and compared the claims program conducted
    pursuant to it with the following statutes, and the claims programs
    conducted pursuant thereto, after the war:
              The Philippines Rehabilitation Act of 1946
              The War Claims Act of 1948, including the 1952, 1954,
            1956, and 1962 (Wake Island) amendments to the Act, and Title
            II of the Act, added in 1962--The Micronesian Claims Act of
            1971--The Aleutian and Pribilof lslands Restitution Act (1988)
        The Review Commission also conducted hearings on Guam, at which
    time we heard moving testimony from survivors of this terrible period
    in history. We then held a legal experts' conference in Washington,
    D.C., where relevant legal issues and the history of Guam were
    discussed. Finally, the Review Commission submitted its Report to the
    Secretary of the Interior and to specified congressional committees
    summarizing our findings and recommendations.
        The Review Commission found that the Navy's Land and Claims
    Commission, administered pursuant to the Guam Meritorious Claims Act of
    1945, was significantly flawed and fell short on a number of important
    counts, when compared to the claims programs provided for residents of
    other U.S. territories. The most significant of the flaws in this
    program being the poor public notice given for the claims program on
    the war ravaged and chaotic Island and the short opportunity residents
    of Guam had to file claims.
        The Review Commission also found, and I would like to make special
    mention, that the residents of Guam exhibited great courage and loyalty
    to the United State in the face of extreme hostility at a time when the
    outlook for the U.S. prevailing was far from assured. As demonstrated
    by the time when a number of the residents of Guam hid and protected an
    American sailor during the Japanese occupation. But for the assistance
    by the U.S. national residents of Guam, who knows how WW II would have
    ended?
        The Subcommittee has asked me to address a number of specific
    questions regarding the work of the Review Commission. These questions
    are: why should U.S. taxpayers pay for these WW II reparations?; How
    are the awards under H.R. 44 different from the amounts already
    received by 4,356 claimants under the Guam Program?; What is the
    justification for the different levels of compensation in H.R. 44?
        The Japanese cannot be held responsible for any further payment of
    reparations for World War II wrongs committed against Americans,
    including the World War II claims of the American residents of Guam,
    because the terms of the 1951 Treaty of Peace released the Japanese
    from such responsibility.
        At the same time, notwithstanding that the actual funding to pay
    these Guam claims will come from taxpayer funds, it could be argued
    that the funds are, in some sense, traceable to the funds derived from
    the postwar liquidation of the Japanese and German assets frozen at the
    beginning of World War II. Those Japanese and German funds were lumped
    together and distributed by the Department of the Treasury, pursuant to
    the various War Claims Commission and Foreign Claims Settlement
    Commission claims programs. No distinction was drawn between Japanese
    and German responsibility for any particular claim or set of claims.
    (This contrast with the funding of war claims against the Axis
    countries Hungary, Romania, and Bulgaria. Title III of the
    international Claims Settlement Act of 1949 mandated separate funds,
    derived from the respective countries' frozen assets, to cover claims
    against each of those countries.) Insofar as the Foreign Claims
    Settlement Commission is aware, it has not been possible to determine
    whether all of the proceeds from liquidation of the Japanese and German
    assets have in fact been expended. Therefore, in this case, it could be
    said that these Guam claims would be paid with Japanese funds.
        With regards to the 4,356 claims received, although I don't
    recognize that number, the first thing I wish to point out is that
    while the Guam Program shows a total of 6,365 awards, only 318 of those
    were death claims and only 257 were injury claims, the rest were
    property claims. Again, this breakdown indicates where the Navy's
    priorities were, understandably with the war effort. The other point I
    wish to make with regard to this question is, as like all such war
    claims programs, there is no legal obligation to make these payments
    and, as I have said before, the payment of these awards are ex-gratia.
        As to why the Review Commission recommended different categories of
    claims, the Review Commission found that due to the passage of years
    and the loss of relevant records, it is virtually impossible to
    differentiate among the many brutal injuries each resident of Guam
    suffered during the Japanese occupation. We also looked at other
    similar remedial claims programs to this recommended program and found
    that the most appropriate method for apportioning compensation for the
    resident's suffering would be to grant one single lump some award
    covering each categories of harm, regardless of how many types of harm
    a person may have suffered. Each level of compensation is justified by
    the different, brutal, and very difficult hardship experienced by each
    of the residents of Guam during the occupation. Even the least severe
    level of compensation, the internment, caused significant illness and
    death due to exposure to the elements for weeks without shelter.
        In conclusion, the five Commissioners who served on the Review
    Commission came from different points of view and backgrounds, as well
    as both political parties and yet we came to these findings and
    recommendations unanimously. I stand by those findings and
    recommendations and continue to believe strongly that they should be
    implemented. I would also like to say that those of us who came to the
    Review Commission from the Foreign Claims Settlement Commission were
    pleased to have had the opportunity to use our familiarity and
    expertise regarding war claims issues to assist in the accomplishment
    of this important work.
        Mr. Chairman, this concludes my statement. I will be happy to
    respond to any questions that you or the other Members of the Committee
    may have.
                                     ______

      Response to questions submitted for the record by Mauricio Tamargo,
        Former Chairman, Guam War Claims Review Commission, and Former
              Chairman, U.S. Foreign Claims Settlement Commission

    From The Honorable Madeleine Z. Bordallo
    Q:  In previous war claims programs administered by the United States,
            is it typical for an Administration to request funds for the
            claims program in its annual budget request to Congress prior
            to the authorization of the program by the Congress and the
            subsequent approval of valid claims under that program?
        A: ``The Administration has not requested funding to pay claims
    under any program of the nature currently contemplated for the
    residents of Guam. This is necessarily so, as it would be impossible to
    know how much funding to request in advance of ascertaining the
    universe of potential outstanding claims.
        In a few small claims programs, Congress has appropriated funds to
    pay claims after it had conferred authority to adjudicate the claims on
    a commission, but prior to the commission having evaluated the specific
    claims. In these particular claims programs, the Administration and
    Congress had an idea of the likely universe of outstanding claims. One
    such Program arose out of post-World War II conflicts and involved
    inadequate rations and inhumane treatment of American servicemen held
    as prisoners of war.
        In this current legislation, as in most claims programs, even
    though we have a rough idea of how many claims there may be, due to the
    age of the claimants, it is too difficult to estimate the appropriated
    funds that will be needed to cover this program.''
                                     ______

        Mr. Landry. Thank you. I would now like to recognize Brig.
    Gen. V.G. Ben Blaz, and also a former Member of this body for
    an opening statement. Thank you for being here today, General.

     STATEMENT OF BRIG. GEN. V.G. BEN BLAZ, USMC, RETIRED. FORMER
                           MEMBER OF CONGRESS

        Mr. Blaz. Thank you. Thank you very much, Mr. Chairman,
    Ranking Member, Members of the Committee.
        I came here to use my time reading my statement as the
    others have done. I have decided to forego that, sir, because
    with all due respect in your opening statement I was concerned
    about some comments that I feel that if I don't respond there
    might not be another opportunity for me to respond.
        I am very sincere when I say to you, with all due respect,
    as a former Member, I understand fully the responsibilities
    that you have and what decisions you need to make and how you
    weigh one against the other. But having mentioned the Heritage
    Foundation, apparently the source of much of your information,
    you just admitted something for the record, I say to you, sir,
    please read my statement later on.
        Let me just start with the first thing that you mentioned
    about the citizens of Guam 1943 to 1956 received $8 million and
    you said apparently that is inadequate. Sir, I would prefer to
    call it incomplete, incomplete, and the reason it is incomplete
    is simply because there were so many people that were not
    aware. I was on Guam, Mr. Chairman. I was 17 years of age at
    that time when this thing was happening. I come from a family
    of eight children and my mother and father there were 10 of us.
    Our concern at the time was clearing the debris from our home
    and finding a meal for the next time that we sit down.
        We were stunned later on when we discovered that there had
    been this Commission out there, and you just can't imagine how
    welcome it would be if you are starving and somebody handed you
    a dollar, and that is what we would have embraced the person.
        So I think that there is a sentiment, and I think it is a
    very distressing sentiment that somehow this thing is now over.
    I say it is incomplete, and I say that we need to give them
    another shot.
        The second thing that was mentioned was that at least--good
    grief, this distresses me somewhat as a Marine officer--that
    someone from the Heritage Foundation would characterize the
    death, killed in action, as being that is enough, what else do
    you want us to do? What else do you want us to do? We liberated
    you.
        It shows an intensely ill-informed person that would write
    that. It presumes that the reason United States came to Guam
    was to liberate us and that alone. It presumes that the reason
    we captured the Northern Marianas rather than liberate them was
    to set them free. That is not enough because you would have to
    answer the question why did we lose so many people in two of
    the fiercest battles in World War II in either theatre, taking
    Peleliu, no residents, attacking Iwo Jima, no residents. So the
    argument falls flat on its face, sir, that somehow the United
    States came. We are grateful. I know we are grateful, but by
    golly, we gave the United States, we gave, and besides Saipan
    and Guam, we practically defeated the Japanese by ourselves
    because our land was so--forgive me, forgive me, sir, for
    speaking so loudly but this is very dear, very dear to my
    heart.
        I also want to mention that the matter that you mentioned
    about the treaty of--I mean, the $10 million or $10 billion. I
    agree with you. I absolutely agree with you. I cannot imagine,
    I cannot imagine that an organization such as the House with
    all its tremendously capable people in the U.S. Government as
    well that somehow we cannot find a way to say that out of that
    $10 billion we must be able to carve a few pennies and settle
    this matter.
        Now, why do we want to settle this matter? We want to
    settle this matter, sir, because we need one. Now the military
    likes to describe Guam as the tip of the spear. Well, Guam has
    been the tip of the spear since 1898. I have here a picture,
    Mr. Chairman, I have here a picture of stamps that were issued
    in 1990, while I was here, and it is a picture of Guam. Guess
    what it says parenthetically. ``A U.S. outpost.'' So I
    challenged the Committee, why do you call Guam a U.S. outpost?
    The Committee staff checked it all out. They called me in and
    said, ``because that is what it is.'' And I said, ``I
    understand.''
        That is what it remains, it would appear.
        So, what I would like to say to you, sir, is that this
    whole idea of compensation, the whole idea that somehow we
    don't owe the people of Guam this, there is a lot more to what
    is intended here than monetary value. At the risk of misquoting
    it why don't we call it, given the intensely loyal sentiment on
    Guam for the United States, why don't we call it the lack of
    response? It is obviously unrequited love, unrequited love.
        We now are about to ask them one more time to look at China
    and to look at North Korea as an outpost and say, hey, will you
    let us know when something else is happening out there? I say
    to you, and I am way past my time, obviously, and I don't want
    to be chastised about this, but, Mr. Chairman, if you don't
    remember anything else that I have to say is that, sir, we are
    not trying to get this compensation to bring back the dead. All
    we are trying, sir, is to get this compensation to honor the
    living.
        Thank you.
        [The prepared statement of Mr. Blaz follows:]

    Statement of Brigadier General Vicente G. ``Ben'' Blaz, USMC (Ret), and
    Former Member of Congress from Guam, on H.R. 44, the Guam World War II
                            Loyalty Recognition Act

        Chairman Fleming, Ranking Member Sablan and Distinguished Members
    of the Committee
        It has always been an honor for me to be in the halls of Congress
    as a visitor, a witness, and a former Member. Since leaving the
    Congress, I have frequently told my friends that hearing rooms on the
    Hill are like mini-coliseums. The Members are the Caesars and the
    witnesses the gladiators!
        When Guam was liberated in July of 1944, about 20,000 sons and
    daughters of Guam emerged from the concentration camps ragged and
    gaunt. Some joyous and singing, some quiet with guarded smiles, and
    others perplexed with lingering fear in their eyes! Virtually all the
    elders, however, were in unison, fingering their rosary beads seemingly
    in a race as though the ones who finished the fastest would be the
    first to be freed. Of the original number liberated, it is estimated
    that only several thousand are still alive. I am one of them. I appear
    before you on their behalf.
        My compliments to my successors, Congressman Robert Underwood and
    Congresswoman Madeleine Bordallo, and you, Mr. Chairman and members of
    the Committee for your efforts in getting us to this juncture in our
    long odyssey to resolve an issue which has torn the hearts of American
    citizens on Guam, particularly those who survived the occupation. To
    Chairman Tamargo and fellow commissioners on the Guam War Claims Review
    Commission, I tip my hat and extend a hearty, Si Yu'os Maase,* for a
    report well researched, well documented, well written, and exceedingly
    well done. (*In the language of our people, this translates to ``May
    God have mercy on you,'' the customary way of expressing gratitude).
        Filing cabinets here in Congress are replete with thousands of
    pages centered on the astonishing brutality suffered by our people
    during the occupation. The unspeakable evil inflicted on conquered
    peoples by Imperial Japanese forces during World War II pains the heart
    to recall. The rape of Nanking in 1937, the Bataan Death March in 1942,
    and the Manila Massacre in 1945 stunned the free world. Rape, forced
    marches, forced labor, and massacres were also inflicted on the people
    of Guam.
        Numerically, the number of victims on Guam did not draw notice as
    those in China, Singapore, and the Philippines did; however,
    statistically, on a per capita basis, Guam was spared no quarter. That
    American nationals, on U.S. soil, under the American flagpole could be
    so brutally and cavalierly mistreated was extremely difficult for us to
    comprehend and accept. It may have earned us the dubious distinction of
    being the first Americans mistreated in this manner in our own American
    land. Remarkably, it appeared to me that the harsher the treatment, the
    deeper the devotion to the United States. The profound loyalty of the
    people of Guam was the subject of many writings and commentaries during
    and after the war. Among those who filed reports from Guam was war
    correspondent, Quentin Reynolds, who, after spending time in
    rehabilitation camps, reported, ``These are real Americans. There never
    were any quislings on Guam.'' Sadly, these ``real Americans'' have been
    waylaid from receiving war reparations benefits on technicalities,
    their remarkable patriotic record notwithstanding.
        Once again, Guam's strategic location in the western Pacific has
    attracted national attention. Once again, our small island, still only
    30 miles long, is slated to host thousands of Marines and other
    military personnel and their families. In the early 1970's, I commanded
    the 9th Marine Regiment of about 4000 Marines stationed in Okinawa. One
    of the most challenging problems we had was maintaining cordial
    relations with the neighboring communities. Because we were in a
    foreign country, we were guided by the status of forces agreement
    between the U.S. and Japan. There is no such agreement between the
    armed forces on Guam and the civilian communities. Good will must
    prevail between the Americans on the base and the Americans outside the
    base.
        Strategists are generally in agreement that there would be a large
    military contingent on Guam for the rest of this century. By the time
    deployments are executed, the chances are there would only be a handful
    of Guam war survivors still alive. The sons and daughters of the
    survivors and their children, many of whom are lawyers, doctors,
    dentists, engineers and business men and women would be the leaders in
    our communities. Were the contentious matter of reparations continue to
    remain unresolved, it is not likely that the fabled hospitality of the
    people of Guam would be unaffected. Having agonized with their parents
    for many years over the lack of action concerning war reparations
    matters, the historic goodwill between the military and the people of
    Guam is likely to be in jeopardy.
        Once again, as it has done in the past during World War I, World
    War II, Korean War, Vietnam War and other conflicts which followed,
    Guam, by virtue of is strategic location, will have a major role in the
    security and defense of the United States. No other community in the
    U.S., territory or state, has served the national and international
    security interest of the United States as consistently and loyally as
    Guam and its people. Per capita, more of its sons and daughters have
    given their lives in defense of the United States than any other
    community its size and population. With China and North Korea just a
    few time zones from Guam, its strategic importance remains
    indispensable. The U.S. needs Guam's help again. Meanwhile, Guam could
    use help now in its quest for reparation for its sufferings and losses
    during World War II.
        When Guam was captured and occupied in World War II, it changed our
    lives on Guam profoundly and, for some, permanently. In accordance with
    national and international practice, custom, and tradition, we sought
    reparation not for broken homes but for broken bones. It has been a
    long journey on a trail with too many crossroads.
        I was 13 when the journey started. I am now 83.
                                     ______

        Mr. Landry. Thank you, General, and I understand and I
    appreciate your comments. I can't imagine what it was like
    living through that. It was a horror for a lot of people around
    the world at that time that I am sure the trials and
    tribulations that the people of Guam went through was repeated
    not only in the Pacific Islands but also in Europe as well.
        I would like to recognize myself for five minutes since you
    took some issue with some of my comments.
        Governor, it is my understanding that Guam leaders have
    rejected past settlement offers. Where is Guam in regard to
    these settlement offers, these settlement numbers?
        Governor Calvo. As to a poll? Please recite the question.
        Mr. Landry. It is my understanding that in 1990 there was
    an offer that was made of approximately $49 million, and then
    that offer was rejected. Do you agree with that?
        Governor Calvo. You know, I was not aware of that. I was
    not in public office back in 1990 so I wouldn't be the right
    one to ask that question. I don't have an answer. What I do
    know is I go funerals every week and every week I see one less
    person to be compensated because they are in a funeral.
        Mr. Landry. I would like to make sure that we understand
    that from the research I have done it is not as if the
    government has said--has been absolutely no money offered to
    Guam. It is my understanding that--Mr. Tamargo?
        Mr. Tamargo. Yes, sir.
        Mr. Landry. Would you like to comment on that settlement
    offer?
        Mr. Tamargo. The 1990 settlement offer? Yes, the report
    studied that and makes mention of it in our report, and that
    was some of the members of the Commission, when we decided--
    when we came up with the recommendations we used that as the
    measure of those living at that time because we thought it was
    unfortunate that they did not come to an agreement at the time,
    and it was unfair to hold that against the people of Guam, so
    that was simply used as a marker as to those living at the time
    should be included in the remedial program.
        Mr. Landry. Well, I guess my concern is that in 1990 there
    was an offer on the table for $49 million. Here we are some 20
    years later. There are a lot of people that have passed away
    between now and 20 years, and I am trying to understand why $49
    million at the time was not enough. I am trying to understand
    where did we come up with this quantity of $100 million.
        Mr. Tamargo. If your question is, sir, why was the offer
    not accepted at the time, my information was that the offer was
    limited to those living at that time, and the community of Guam
    did not believe that was----
        Mr. Landry. OK.
        Mr. Tamargo. That was the issue at the time.
        Mr. Landry. So it is not as if there has not been, that
    Congress and this government has been--you know, there wasn't
    any offers going out there. I mean, there was money on the
    table, I think a considerable amount of money, and I know my
    time is almost limited.
        Mr. Tamargo. Mr. Chairman, I would like to add though that
    there was unanimity in the Federal Government to do something
    about the program then.
        Mr. Landry. Right.
        Mr. Tamargo. The administration at the time, the Congress
    at the time----
        Mr. Landry. It is a question of money now. Is it the
    amount?
        Mr. Tamargo. Well, these monies are more symbolic than they
    are actual.
        Mr. Landry. Well, here is the problem and this goes on,
    which leads into my next question--I only have a minute
    fifteen--to the gentleman and I hope he understands--$15
    trillion in debt. At the time the $49 million was offered, we
    were only $3 trillion in debt. I guess my question, General, if
    we pass this bill, where would you suggest we take that $100
    million from?
        Mr. Blaz. Sir, last year in the Pigford settlement that
    awarded Black farmers and other minorities recognition of their
    agricultural claim, we found $4.2 billion last year. The year
    before that we found $198 million for the Filipino scouts. In
    1998, we found a billion dollars for the Japanese Americans
    that were relocated which was a horrible part of our history,
    but that is what happened. In 1988, we found money for the
    Aleutian restitution, and in 1971, we found money for the
    Micronesian claims.
        Mr. Landry. If you don't mind, General, if I may interrupt,
    the problem we have here is now we are under a different set of
    rules. We are under--if we are going to award $100 million to
    one, we have to cut it somewhere else because in a lot of the
    instances you just explained there was a lot more money
    available. In the last two years we have spent $2.5 trillion
    more than we spent two years ago, and so I respect that, and I
    wasn't here in that Congress, and look, that is why I am here
    today asking these questions. I am just trying to find out
    where we would offset that money from because we can't just do
    what the past Congresses have done over the last 30 years or
    so. We can't just add it to the deficit. We have to cut it from
    somewhere else, and I am sorry that they spent so much money in
    the last two years. They spent an ungodly amount of money. I
    wasn't here. I want you to understand that. I wasn't a part of
    that particular spending but, unfortunately, I am now part of
    the group that has to make real tough decisions, and so that
    was all.
        I know my time has gone over, so I would like to go ahead
    and recognize the Ranking Member, Mrs. Bordallo--Mr. Sablan.
    She was looking at me.
        Mr. Sablan. No, that is fine, Mr. Chairman. I yield my five
    minutes to Mrs. Bordallo.
        Mr. Landry. All right, fine. Mrs. Bordallo.
        Mrs. Bordallo. Mr. Chairman, I was listening very carefully
    to your exchange her with General Blaz, and if I find an offset
    will you then support H.R. 44?
        Mr. Landry. I couldn't commit to that but what I would tell
    you is I would be interested in where--you know, in where.
        Mrs. Bordallo. Good, because this bill has passed the
    Congress five times. It is only the Senate, and I have been
    told that if I find an offset over there in the Senate they
    will agree, so I am just asking you. Would you agree?
        Mr. Landry. I couldn't commit on that right now, but it
    certainly would--it certainly would be a starting point.
        Mrs. Bordallo. All right, the Chair entered--yes?
        Governor Calvo. With all due respect, I was reading the
    newspaper the other day. One of the things as a loyal citizen
    of the United States, and Congresslady you see some of the
    issues just on FEA that I mentioned or AITC, what I brought up
    earlier, and it would be too long to recount all the Federal
    mandates that have really bankrupted our island, but I could
    recommend--I just saw in the news Pakistan. If they are cutting
    aid to Pakistan, why don't you offset some of that money with a
    loyal American territory such as Guam? A little recommendation.
        Mrs. Bordallo. Thank you. Governor, just for the record I
    would like to ask you the same question I asked General Blaz.
    The Chair entered a statement from the Heritage Foundation that
    suggests that whatever war claims are due do not take into
    account the sacrifice of lives and injuries to liberate Guam.
    How would you respond to this?
        Governor Calvo. What I understand is I don't think the
    Heritage Foundation is--I am wondering whether anyone from the
    Heritage Foundation has ever stepped foot on our island.
        Mrs. Bordallo. Probably not.
        Governor Calvo. You know, when I first came to college out
    here, when I said I was from Guam, and it was well meaning, a
    lot of folks were saying, oh, is that near South America?
        Mrs. Bordallo. Yes.
        Governor Calvo. Or do you live in huts? And unfortunately,
    you know, we are so far away that there is little understanding
    of our island.
        Mrs. Bordallo. That is true.
        Governor Calvo. Just myself, my grandfather was first
    cousin of Father Duenas. Father Duenas had his head chopped
    off. My father didn't take off his shoes when he went into a
    classroom and the sensi beat him up.
        Mrs. Bordallo. Yes.
        Governor Calvo. You know, I had another uncle, when you
    have an uncle whose father was a U.S. Marine, what they did
    with him was they stuck a hose in his mouth and he filled up
    with water. When it is filled sufficiently, they put the board
    on top of him and jump on him. These are things--I don't know
    if you can quantify it.
        Mrs. Bordallo. No.
        Governor Calvo. But they were all loyal citizens----
        Mrs. Bordallo. Yes.
        Governor Calvo.--when they were alive, and their children
    are still also loyal citizens.
        Mrs. Bordallo. Loyal citizens.
        Governor Calvo. This has been 67 years.
        Mrs. Bordallo. Governor, I just want to mention to the
    Chairman, yes, when I came to Congress, you know, this is my
    fifth term, and when I came to Congress, just to show you how
    much they know about the territories, that is not just Guam but
    all of us, they asked me if Guam was part of Hawaii, one of my
    colleagues. So, you know, we have a big job here. We work three
    times as hard as any other Member when it comes to explaining
    our situation and why we are important to our country.
        Mr. Tamargo, can you explain the Review Commission's
    finding that there is not a legal obligation for Guam war
    claims as one of the statements for the record states while the
    Commission report also states there is a moral obligation?
    Would you explain the distinction?
        Mr. Tamargo. Certainly, Congresswoman. War claims, there is
    never an obligation by a nation to pay--to create a claims
    program. That is simply a moral obligation, and that is what I
    was going to explain to the Chairman also. These are war claims
    given to citizens so that no one citizen has a disproportionate
    burden in the war. Soldiers have different programs for them
    but civilians are given the opportunity to file a war claim if
    they are so eligible, but Heritage's remarks about soldiers
    dying on the beaches--I have great respect for the American
    servicemen, but those are apples and oranges. We are not
    talking about soldiers. We are talking about civilian
    population that suffered war damages, and the mission of the
    Commission was to compare the claims program that was given to
    civilians on Guam and compare it to the civilians given to
    other U.S. civilians elsewhere in the Pacific, and there is
    disparity in the comparison, and that is just the facts.
        So, if the facts that they were not treated fairly, then
    what would be called for as a moral obligation was to achieve
    parity. They would need to re-create a remedial program to give
    equity to the civilians of Guam, so it is a moral obligation.
        Mrs. Bordallo. Thank you. Mr. Chairman, Mr. Sablan, would
    you yield your time to me? Yes, to continue.
        Mr. Sablan. To continue, I yield my time.
        Mrs. Bordallo. Thank you, Mr. Chairman.
        Mr. Landry. The Chair now recognizes Mrs. Bordallo for five
    minutes.
        Mrs. Bordallo. Mr. Tamargo, I want some clarifications here
    because I think our Chairman is new to Congress and probably
    doesn't understand all of the situation, but can you explain
    for the Committee the legal rationale for why the United States
    would pay for Guam war claims and not the government of Japan
    under this legislation?
        Mr. Tamargo. Certainly. Well, in the Treaty of Peace in
    1951, the U.S. relieved Japan of all further liability and
    accepted all debts against Japan have been satisfied and they
    seized the frozen Japanese assets that were in U.S. banks at
    the time as settlement for all damages caused by the Japanese
    in World War II.
        It was done with the Germans as well and it was commingled
    with U.S. funds, and so I would say these funds that would be
    paid to these, as were with all the other claims programs,
    these funds are indirectly coming from the Japanese and from
    the Germans, frozen assets that were seized and put into the
    Federal treasury.
        Mrs. Bordallo. Very good.
        Mr. Tamargo. So in my view Japan is paying for the damages.
    This is Japanese funds that are paying for these claims.
        Mrs. Bordallo. I don't know if you were listening, Mr.
    Chairman, but--right, oh, to explain. I see.
        Another question that comes up when we have been through
    all of this for the last nine years is would this set a legal
    precedent? For example, people have come up to me and said,
    well, if we do this, then that would open up a flood of claims
    from other groups like the POWs, the veterans or the Filipinos.
        Mr. Tamargo. In my opinion it would not open up other
    claims. As the Chairman said earlier, and as others have said,
    and I have said, this is a moral obligation, not a legal
    obligation. So in the case it satisfies this moral obligation
    does not necessarily open you up to other obligations because
    there is no legal bind. It is just a moral obligation that the
    country feels they owe to these nationals.
        Mrs. Bordallo. Thank you. And Governor Calvo, how important
    is it to resolve this matter of Guam war claims? Can you speak
    to its priority on all the issues of our territory, and I know
    you have a lot of issues in addressing with respect to Federal
    territorial relations?
        Governor Calvo. I just got through an election and I barely
    won it, but going through that election, going out there,
    especially with the young people, and I think it is very
    important not only for the Chairman but of people from the
    House of Representatives and the Senate to recognize, we are a
    loyal people, but that young generation, they are much smarter
    than us and they are getting--they are knowing history. Guam
    and the Marianas are strategic to the United States, and I do
    not want to repeat all--I would be here all day--the issues
    that have happened since World War II, but there are so many
    issues that now our young people are aware of.
        As we move forward in political self-determination, I do
    believe the goodwill of Members of this Congress, this
    Administration, the Federal Government, or the ignorance or the
    nonchalance or the uncaringness will have an impact on these
    later generations on what direction we will go politically, I
    really do.
        I would like to see closer union with the United States,
    but there is a burden that has been part of the people of Guam
    because we have been so--you know, 9,000 miles away. We are a
    forgotten people, and we have been so loyal.
        Mr. Chair, I am a great grandson of a U.S. Marine who came
    in in 1901, so there is this history like many of us have with
    the U.S. military. There is a love of the men and women in
    uniform, but unfortunately some of the decisions that have been
    made in Washington, D.C. I do believe will have an impact on
    the direction of where our people will want to go in the
    future.
        Mrs. Bordallo. Thank you.
        Governor Calvo. And this is one of those decisions.
        Mrs. Bordallo. I wish to reclaim my time here, and one
    final question I have is for the Department of the Interior.
    For the record, Mr. Pula, can you clarify once and for all does
    President Obama support H.R. 44?
        Mr. Pula. I believe in my statement I said the Obama
    Administration through our Department of the Interior support
    the amendment.
        Mrs. Bordallo. Thank you. And will you then help us find an
    offset?
        Mr. Pula. We are always looking for offsets these days.
        Mrs. Bordallo. Thank you. And I yield back, Mr. Chair. I
    yield back.
        Mr. Landry. Thank you. The Chair now recognizes Mr.
    Faleomavaega for five minutes.
        Mr. Faleomavaega. Thank you, Mr. Chairman. I have been
    listening very closely not only for the most eloquent
    statements from my colleague, the gentlelady from Guam, Mrs.
    Bordallo, but also the statements made by our witnesses this
    morning, Governor Calvo, Mr. Pula, Mr. Tamargo, and my good
    friend Brigadier General Blaz, a former Member of this great
    institution.
        Mr. Chairman, this is like a broken record for the past 65
    years since we have been discussing this issue before the
    Congress, a broken record to the fact that five times this bill
    has passed this House, and for some reason or another somehow
    we just cannot seem to persuade our colleagues in the other
    body to do the right thing in giving the proper compensation
    for these people who suffered so much.
        I do appreciate your concerns to the fact that we have some
    very trying period in our country's situation, economic
    situation with the deficit and the some $14.5 trillion national
    debt that we are faced with. But, Mr. Chairman, there are some
    historical aspects that I want to share with you in my
    understanding formerly not only as a Vietnam veteran, but
    someone who has lived in Guam, and with a real deep respect for
    the Chamorro people and understanding their concerns, and what
    they were confronted with.
        In the first place before the Japanese attack on Guam in
    1941, Mr. Chairman, it was a very unusual situation on the part
    of our government because these people were U.S. nationals, and
    somehow our military leadership decided not to take the people
    off the Island of Guam before the invasion by the Japanese. Is
    it because they were not U.S. citizens but they are U.S.
    nationals? And as U.S. nationals, according to the immigration
    laws, is defined as any person who owes permanent allegiance to
    the United States, and this is another bit of history, Mr.
    Chairman, in wanting to know why these U.S. nationals were
    never evacuated before the invasion of the Japanese forces in
    Guam in 1941. That still remains to be a question why this was
    done. Is it because they are not U.S. citizens, but I have just
    defined what a U.S. national is according to our own
    immigration laws.
        Mr. Chairman, I don't know what the Heritage Foundation, I
    have not received a copy of the letter from the Heritage
    Foundation. If they raise objections to the substance of this
    bill, I just want to say that I do have a high respect for the
    Heritage Foundation for its conservative positions and issues
    that we discussed here nationally, but this one instance, Mr.
    Chairman, I cannot believe that the Heritage Foundation
    questions the validity of this proposed bill.
        Now, there are some questions raised about, well, where are
    we going to get the money. Somehow we are able to find $10
    billion for the relocation of some 9,000 Marines and their
    dependents in the coming years, and part of the funding of some
    five to six billion dollars is going to come from the Japanese
    government. And I wonder in that respect, Mr. Chairman, that
    maybe this is the pot we ought to look at seriously in
    providing compensation as part of the $16 billion transfer. If
    we can do it for 9,000 Marines and their dependents, then I am
    certainly--I cannot believe that we cannot find funding as part
    of the $16 billion transfer. I do want to offer that
    recommendation strongly since Japan is also paying part of this
    transfer at five to six billion dollars.
        Mr. Landry. Will the gentleman yield?
        Mr. Faleomavaega. I will be glad to yield to my friend.
        Mr. Landry. If I may, I think that is a great point, but if
    I could clear up the air here on this Heritage Foundation
    letter----
        Mr. Faleomavaega. Please.
        Mr. Landry.--that seems to have created some fire storm. I
    will tell you how I feel and that is why I am here is to ask
    these questions and to understand, and you are right. Guam is a
    distance away from the mainland. At this particular time, in
    this particular Congress with the financial situation that we
    are in it is very, very sensitive subject, and it is hard
    because it is personal to people like the General. But those
    finances are just as personal to the U.S. taxpayer as well, and
    I am sure, Governor, that the U.S. Government and these
    Congresses have appropriated millions, maybe tens of millions,
    maybe hundreds of million dollars over the last 50 somewhat odd
    years in support of infrastructure and things on Guam.
        I want you to know that I believe in supporting the
    territories of this country. I was in Puerto Rico not too long
    ago, and telling someone I think it is a great place. I don't
    know why it is not a great vacation place for a lot of people
    in the United States. It is a great place, beautiful. I would
    look forward to going to Guam. I enjoy visiting those islands.
    I would like to support them economically.
        The tension here is a matter of cost of where we are
    financially in this country. So understand that that is why I
    chose these issues. It was not to slight anyone from a personal
    standpoint, but I think a lot of U.S. taxpayers out there are
    asking those particular questions, but I think you raise a
    great point of where we could get the money from.
        Mr. Faleomavaega. And Mr. Chairman, I do want to thank you,
    and I never, never to question your sincerity in wanting to
    reach out and trying to understand where can we possibly get
    the proper funding. It is of interest, too, Mr. Chairman, and I
    really don't believe it is the money, it is the principle, Mr.
    Chairman. I think that all the Chamorro people are asking for
    as loyal citizens of this great nation of ours.
        Let me just say Guam is the most important military
    strategic island that we have in that whole region of the Asian
    Pacific. Let me just share another point with my good Chairman.
    When I first came here 20 years ago as a Member of this great
    institution, as a Member of the Foreign Affairs Committee I
    wanted to be on the Asia Pacific Committee. Becoming a member
    of that subcommittee, nobody wanted to be on the Asia Pacific
    Subcommittee on Foreign Affairs. Do you know why? Because the
    whole mentality here in Washington was on Europe and the Middle
    East. The Asia Pacific region was not even on the radar screen.
    If it was, we were not--if we were not bashing the Japanese, we
    were bashing the Chinese. It was never a positive experience,
    and understanding now the Asia Pacific region we have to make
    better attention, and our relationship with this area, which is
    almost 60 percent of the world's entire population, and Guam is
    part of that.
        Again, I realize my time is up but I do want to share this
    with the Chairman. I cannot have a better witness than someone
    whom I have always considered not only as a father figure but
    as a military veteran himself and for someone who has my utmost
    respect as a retired Brigadier General of the United States
    Marine Corps, and I will never forget the words that he shared
    with this institution in terms of how we have treated people
    from the islands, and this is what he said, this is what my
    good friend General Blaz said, and I will never forget what he
    said. ``We are equal in war but not in peace.''
        So it is OK for people from the islands to get their guts
    spilled and killed and all of the battles and the things that
    we volunteer to be part of our defense system, but when it
    comes to situations where we are giving proper compensation for
    what the good people of Guam is asking for, and as some of our
    witnesses said and I am sure my good Chairman will agree, this
    is a moral obligation that our government has toward these
    people, and I cannot think of a higher standard than we would
    have to suggest that if we do otherwise, then I think we failed
    as a nation to do what we should be doing in honoring the
    sacrifices that the Chamorro people have made on behalf of our
    country, on behalf of our country, and never once did they ever
    fail to prove their loyalty and their absolute convictions that
    this is a great country, but they just feel like they are not
    being just treated fairly. I think that is the bottom line, Mr.
    Chairman.
        I know my time is up and I just want to say that I have 100
    more questions I wanted to raise here but I know time is up,
    and hopefully maybe wait for the second round. Thank you, Mr.
    Chairman.
        Mr. Landry. I was just informed that they need this room
    for another meeting that is coming up. I find that there is
    another hearing, so we won't be able to have a second round, so
    I thank the gentleman for his comments, and I would like to
    thank the panel again for their valuable testimony and
    contributions. Members of the Subcommittee may have additional
    questions for the witnesses, and we ask that you respond to
    these in writing. The hearing record will be open for 10
    business days to receive your responses.
        Finally, again I would like to thank the Members and the
    staff for their contributions to this hearing. And if there is
    no further business, without objection this Subcommittee will
    stand adjourned.
        [Whereupon at 1:24 p.m., the Subcommittee was adjourned.]

        [Additional material submitted for the record follows:]

    Statement submitted for the record by Frank F. Blas, Jr., on behalf of
         the Guam Survivors Memorial Foundation, in support of H.R. 44

        Hafa Adai (Greetings) Mr. Chairman and members of the House
    Subcommittee on Fisheries, Wildlife, Oceans, and Insular Affairs. I am
    Frank F. Blas, Jr., Minority Leader for the 31'' Guam Legislature and
    also President of the Guam War Survivors Memorial Foundation, and I
    want to thank you for the opportunity to submit written testimony in
    support of H.R. 44 (the Guam World War II Loyalty Recognition Act).
        In December 8th and 9th of 2003, a War Claims Review Commission (a
    panel created by Public Law 107-333, L16 Stat. 2873, known as the Guam
    War Claims Review Commission Act) held hearings on Guam to receive oral
    testimony from survivors of the World War II Japanese occupation of the
    island. In the two day period, the Commission heard from over 90
    individuals who testified about the brutality, the fear, the agony, and
    the pain that was endured by the people of Guam from December, L94L to
    July of 1944.
        During those hearings, the Commission received testimony from Dr.
    Rosa Palomo Carter, who stated that she was twelve when Guam was first
    occupied by Japanese Imperial Forces. She told of the squalid
    conditions she and her family were forced to live in. She told of the
    forced labor and interrogation she was subjected to as a child. And she
    also told of having to forage for food and fearing many times that she
    would starve to death.
        The Commission also heard from Mr. Edward L.G. Aguon, who stated
    that he was fifteen when Guam was invaded. Mr. Aguon testified that
    during the occupation, he and others were forced to watch as people
    were brutalized, tortured and killed. He had agonizing memories of
    seeing people's faces as the final stab of the bayonet pierced their
    flesh, and hearing their cries as their last breath left their bodies.
        Mr. Aguon ended his testimony by stating that he was77 years old,
    and if he was asked again to testify in another ten years, he may not
    be able to testify.
        Mrs. Delores Cruz Meno also testified before the Commission in
    2003. Mrs. Meno provided that she was ten years old and the youngest in
    a family of ten children when Guam was occupied. She told of the farm
    labor she was forced to perform in order to feed the Japanese
    occupiers. She also told of a forced march that she and others feared
    would lead them to their deaths. Mrs. Meno testified that while the
    march was unexplainably halted, she later learned that her two oldest
    brothers were killed by Japanese soldiers at the place she was supposed
    to march to.
        Mr. Cristobal Reyes was also given the opportunity to testify
    before the War Claims Review Commission in December 2003. While there,
    Mr. Reyes testified that although he was just an infant during the
    occupation, he was informed of the atrocities by his father and wanted
    to share his father's information. Mr. Reyes stated that because of his
    father's complexion and build, the Japanese soldiers suspected that he
    was part American and subjected him to brutal beatings. Mr. Reyes'
    father feared that he was going to be killed but an old Japanese friend
    and pre-war Guam resident convinced the Japanese soldiers that Mr.
    Reyes' father was not American, but was of Chinese ancestry.
        Another survivor that was allowed to testify in the 2003 hearings
    was Mr. Jesus Perez Sablan. Mr. Sablan said that he was fourteen when
    Guam was thrust into the war, and throughout the occupation, was he was
    subjected to continuous forced labor. Mr. Sablan testified that
    although his family was originally from Sumay (a village that was once
    located near the south of Guam), the family was forced to move to
    different villages around the island, and when they thought that they
    could finally settle in Yigo (the northern-most village on the island),
    they were forced to march to a concentration camp in Mannenggon. To sum
    up his experience, Mr. Sablan stated in his presentation, ``Believe me,
    war is hell.''
        Lastly, the War Claims Review Commission received testimony from
    Mr. Juan Unpingco who stated then that he was seventeen when the war
    started on Guam and that throughout the occupation, he witnessed so
    many horrible incidents that he now suffers from nightmares. Mr.
    Unpingco testified that his aunt was raped, his parents were brutally
    beaten, and he and his siblings were forced into labor. In his
    testimony, Mr. Unpingco told of a time when he, his father, and his
    brother were rounded up with other individuals to carry munitions for
    the Japanese soldiers. His father and brother were sent with a group
    that headed to the south of the island, and he was to carry munitions
    with others to the north. Mr. Unpingco stated that during the trek he
    found an opportunity to flee and was grateful that he did so because he
    later learned that all the individuals in his group were beheaded after
    delivering their supplies.
        In the introduction of his book, ``Bisita Guam: Let Us Remember
    (Nihi Ta Hasso),'' former Guam Delegate to the U.S. Congress and
    retired Marine Brigadier General Ben Blaz wrote the following:
            ``For the People of Guam, World War II was as personal as war
            could get. That is not to say that for people throughout the
            country, the war did not strike directly into their homes. From
            loved ones going off to battle, to rationing, to the makeup of
            the workforce, every American was deeply affected. But no
            Americans could say that the cities or towns where they had
            been born were invaded, none could say they lived under the
            harsh dictates of an occupying force, no one in the United
            States could say he or she suffered unique privations simply
            for being American except the people of Guam. The only other
            American territory occupied by hostile forces was the Aleutian
            lslands off Alaska, but they had no permanent population.

            Among Americans, only the people of Guam know what it means to
            live under the hostile yoke of a foreign conqueror. Each of the
            22,000 people who lived on the island through the occupation
            has his or her tale to tell. As must happen, however, those who
            experienced the occupation first hand are inexorably growing
            fewer and fewer. It will not be too many more years before
            those of us who were there will be gone, and there will be no
            one left to attest to the facts of life under the control of a
            foreign military that viewed Guamanians as potential, if not
            outright enemies--people who had to be subjugated by iron,
            totalitarian rule to keep us in line.''
        General Blaz himself is a survivor of the Japanese occupation of
    Guam.
        During the House Hearing held on this measure on July 15, 2011, it
    was obvious that Members of the Subcommittee were concerned that
    passage of this bill could result in additional war claims and there
    was further concern of where the funding would come from to pay such
    compensation. I submit that the testimony and answers provided by Mr.
    Mauricio Tamargo and Brigadier General Vicente G. Blaz, USMC (Ret.)
    adequately addressed the concerns expressed by the Honorable Jeff
    Landry. I further submit that there exists no reasonable or logical
    explanation to continue to deny the people of Guam who endured the
    cruelty and agony of the Japanese occupation their rightful recognition
    and compensation.
        Mr. Chairman and Members of the Subcommittee, I began my testimony
    by giving you excerpts of previous testimonies because had Dr. Carter,
    Mr. Aguon, Mrs. Meno, Mr. Reyes, Mr. Sablan, or Mr. Unpingco been given
    the opportunity to testify before you, I am sure that they would have
    provided you the same. But I submit to you that their chance to again
    relive their experiences would not be possible, because they have all
    since passed away. These survivors, along with almost twenty thousand
    (20,000) of the twenty-one thousand (21,000) people of Guam who were
    ``liberated'' from enemy occupation sixtyseven (67) years ago have
    since left their earthly dwellings. The tragedy in their passing is
    that they were never recognized for their loyalty to the United States
    or for the suffering they endured because the enemy saw them as
    Americans. lt is in their honor that I plead their case for recognition
    and ask that you fook favorably on and support the passage of the Guam
    World War ll Loyalty Recognition Act.
        Thank You.
                                     ______

      Statement submitted for the record by Valerie J. Bock, Resident of
      Guam, Representing self, on H.R. 44, The Guam World War II Loyalty
                                Recognition Act

        My interest in H.R. 44, Guam World War II Loyalty Recognition Act
    is not as a recipient but, as Floridian-American. I've been a resident
    of Guam for five years.
        The responsibility of the Japanese invasion rests solely on the
    shoulders of the United States of America. The Guam survivors should be
    compensated for the atrocities they endured. These atrocities were born
    from Guam's relationship with the United States.
        The point is very simple; the Japanese would never have invaded
    Guam had it not been a territory of the United States. Had Guam been
    independent, the Japanese would never have bothered them. This
    elucidates the United States as responsible for the brutality endured
    by the residents of Guam.
        It's not a matter of how much the Guamanians suffered during the
    Japanese occupation. Although, it is well known they suffered
    atrocities only seen on soil foreign to the United States.
        It's not a matter of how long it took the United States to remove
    the Japanese invaders. Priorities were illustrated by the very short
    response for Hawaii versus a two year response time for Guam.
        It's not even a matter of the patriotism of the Guam survivors.
    Though, their patriotism has been a constant source of United States
    military veterans even after the draft was repealed to today. Guam has
    the highest number per capita of United States soldiers who have paid
    the ultimate price.
        Then after the war was won, peace treaties were signed, forgiveness
    was shared and the United States forgave Japan with a promise to pay
    all claims against Japan for the suffering by U.S. citizens. Was it
    truly the right of the United States to speak for Guam? I don't think
    so.
        Now that the United States has spoken for Guam, it is their
    responsibility to repay the survivors for the two, long, hard years of
    slavery and occupation they endured as a result of their association
    with the United States. At the very minimum, the payment should include
    two years of salary. 2005 average salaries equaled $46,300. This would
    equate to a salary repayment of $92,600. Add a small token of
    consideration for the pain and suffering would amount to about $192,600
    owed to each survivor of the war. Less than 1000 World War II survivors
    are still alive. This amount certainly isn't going to break the United
    States budget!
        I am so embarrassed by the actions of my country. We treat our
    fellow citizens of Guam with total disregard for their membership in
    our country. I find the many years that have passed with no reparations
    to the Guamanian survivors is frustrating to them and embarrassing to
    me. It should be embarrassing to every member of the United States
    Congress.
        I implore you to correct this wrong. Let us help these survivors
    move on and let them know they are important United States citizens.
        Thank you for your time.

    Sincerely, Valerie Bock, P.O. Box 7145, Agat, GU 96928
                                     ______

    Statement of The Honorable Benjamin J.F. Cruz, Vice Speaker, 31st Guam
       Legislature, on H.R. 44, Guam World War II Loyalty Recognition Act

        Buenas yan Hafa Adai! Chairman Fleming and members of the
    Committee, thank you for the opportunity to submit written testimony on
    H.R. 44, Guam World War II Loyalty Recognition Act.
        H.R. 44 is the latest attempt in a long and arduous effort to
    resolve an issue very dear to the people of Guam. I applaud
    Congresswoman Madeleine Bordallo's introduction of this measure as a
    standalone as opposed to its inclusion in the National Defense
    Authorization Act, as this proposal should be evaluated on its own
    merits.
        As a member of what was then the Guam War Claims Review Commission,
    I know that we have substantial evidence against the Government of
    Japan for war claims, yet we chose to forgive Japan and this sensitive
    issue is now before the federal government to settle. I am hopeful that
    you have all had the opportunity to read the Commission's final report
    which was submitted years ago.
        The findings of the Guam War Claims Review Commission were affirmed
    on five separate occasions by members of this House only to fail in the
    Senate through the efforts of a small minority. In spite of this
    continued refusal, Guam's people have never disavowed their pursuit of
    Justice.
        It is my sincere hope that 70-year-old atrocities are given closure
    through federal recognition. The trials of the Chamorro people endured
    during the Japanese Occupation of Guam were especially heinous and
    fully deserving of an end to this long chapter in our history.
        Too often legislative bodies are confronted with seemingly
    insurmountable problems; dilemmas which have no immediate solution or
    clear way forward--this is not one of those situations.
        President Obama has lent his support for war reparations, the House
    has passed this measure repeatedly, and Guam's WWII survivors still
    believe that old sacrifices will not be forgotten.
                                     ______

    Statement of The Honorable Benjamin J.F. Cruz, Vice Speaker, 31st Guam
        Legislature, on the Implementation of Public Law 110-229 to the
             Commonwealth of the Northern Mariana Islands and Guam

        Buenas yan Hafa Adai! Chairman Fleming and members of the
    Committee, thank you for the opportunity to submit written testimony on
    the Implementation of Public Law 110-229 to the Commonwealth of the
    Northern Mariana Islands and Guam.
        Let me preface by stating: If the original intent of passing Public
    Law 110-229 several years ago was to align U.S. Immigration Policy for
    Guam and the CNMI and to promote tourism, that intent is not being
    fulfilled. In November 2009, Parole Authority was extended to the CNMI
    for China and Russia tourists and not to Guam. This is clearly in
    contradiction to Congressional Intent.
        The current policy of allowing visitors from China and Russia to
    enter the CNMI under parole authority while requiring visas for those
    entering Guam is unfair and discriminatory.
        It is even more unfair given the new the obligations now posed on
    the Guam community to support the realignment of U.S. forces in the
    region and the unique set of circumstances now facing the visitor
    industry as a result of the disasters in Japan.
        Last year, this committee was informed by officials of the
    Government of Guam and the Guam Visitors Bureau that the sustainability
    of the Japan market, the primary source of visitors for Guam, was in
    question because of fierce competition from lower Asian resort
    destinations and an aging Japan population.
        This year, I am afraid to report that the state of affairs has
    become worse given the tragedies in Japan last March. Please note that
    three out of every four visitors to Guam are from Japan. According to
    statistics provided by the Guam Visitors Bureau, the number of Japan
    visitors as of March is down by over 18 percent. As you can imagine,
    the impact is substantial given Guam's level of dependence on visitors
    from Japan. However, it should also be noted that this market has been
    in an ongoing and gradual decline. Japan arrivals have declined by 27%
    between Fiscal Years 2000 and 2008.
        This is why every opportunity must be taken to improve other
    tourism source markets in order to keep Guam viable. This is why parole
    authority should be granted for Guam for visitors from China and
    Russia.
        The combined number of outbound tourists from the People's Republic
    of China and Russia is approximately 70 million. The number of outbound
    tourists from Japan is 16 million, of which 5.5% (or 900,000) visited
    Guam last year. Thus, Guam through existing federal policy is being
    denied a tremendous opportunity to repair and advance its visitor
    industry and to provide gainful employment to Americans living on Guam.
        Based on CNMI figures, China and Russia provide compelling market
    viability for Guam. Spending by Chinese and Russian tourists in the
    CNMI in 2008 reached $58 million, with per-person spending for Chinese
    visitors averaging $967 and for Russian visitors, $4,323. Overall,
    Chinese and Russian tourists contribute approximately 20% to the CNMI's
    tourism revenues. Based on research conducted by the Guam Visitors
    Bureau, China and Russia may potentially generate $212.2 million in
    combined payroll, hotel lodging, and gross receipts taxes by 2018.
        Furthermore, it should be noted that the experience in the CNMI has
    yielded no significant issues with respect to asylum seeking and
    overstays. Nor has there been reported instances of asylum and
    overstays for the 4200 visitors to Guam from China permitted under
    existing Charter flights from China to Guam.
        The full implementation of PL 110-299 is also imperative to the
    entire region, not just for Guam. An improved Guam economy provides
    carryover benefits to the other communities in Micronesia including the
    Republic of the Marshal Islands, the Republic of Palau and the
    Federated States of Micronesia. You should be aware that Guam is host
    to thousands of migrants permitted to live on Guam under the Compact of
    Free Association.
        By working to improve the Guam-CNMI visa waiver program, Guam will
    be in a better position to improve its economy, reduce its dependency
    on the federal government, and provide carryover benefits throughout
    the region. It will also serve to provide the island with some level of
    sustainability after the military buildup.
        I realize that the House Subcommittee on Insular Affairs, Oceans
    and Wildlife is committed to fostering economic development in Guam and
    the CNMI in a fair and equitable manner. I respectfully request that
    the members take my testimony into consideration and seriously consider
    the economic consequences of not acting to address the inequity.
        Thank you for your time and kind consideration.
                                     ______

     Statement of The Honorable Jeff Duncan, a Representative in Congress
                        from the State of South Carolina

        America is broke. We are $14 trillion in debt, which is more than
    enough for one nation. Worse, our current budget deficit remains over a
    trillion dollars. This requires us to tighten our belts and live within
    our means.
        I stand strongly opposed to H.R. 44, the Guam World War II Loyalty
    Recognition Act. My heart goes out to the people of Guam for the
    violence that they suffered during World War II. However, the United
    States committed no crimes against the people of Guam. To the contrary,
    we liberated Guam from Japanese occupation in 1944. Out of sheer
    generosity of spirit, the United States paid Japan's restitution of $8
    million in 1951, which would be equivalent to nearly $100 million in
    current dollars.
        During this time of great economic uncertainty, I cannot support
    legislation that would cost this country another $126 million of
    taxpayer money. As we debate a debt ceiling increase, it is fiscally
    irresponsible to be paying for something that was not our fault and
    that we cannot afford.
                                     ______

             Statement of Susana Blas Deleon Guerrero, President,
                           CNMI Women's Association

        Hafa Adai Chairman Fleming and members of the subcommittee. I am
    Susana Blas Deleon Guerrero, President of the CNMI Women's Association
    (CWA). I am testifying on behalf of the CNMI Women's Association, which
    seeks to protect the indigenous people of the Northern Mariana Islands,
    the native Chamorros and Carolinians, from displacement in their
    ancestral homeland, and other matters. The CWA rejects House Resolution
    1466, a bill to resolve the status of certain persons legally residing
    in the Commonwealth of the Northern Mariana Islands (CNMI) under the
    immigration laws of the United States, introduced by U.S. Delegate
    Gregorio C. `Kilili' Sablan, NMI-at-large, also a Ranking Minority
    Member of this subcommittee.
        The CNMI Women's Association agrees with CNMI Governor Benigno R.
    Fitial regarding the arguments behind Public Law 110-229, a
    Consolidated Natural Resources Act of 2008 and its effects in the CNMI.
    Please take time to read Governor Fitial's written testimony.
        The CNMI Senate Committee on Federal Relations and Independent
    Agencies held seven public hearings regarding the implementation of
    Public Law 110-229 and other matters affected by such law. After many
    written and oral testimonies submitted and recorded during the
    hearings, it was evident that the indigenous people of the CNMI who
    attended the hearings reject any improved status of thousands of aliens
    (including illegal immigrants) residing in the CNMI. It is not that
    those in opposition refuse aliens to have some status, but the people
    oppose being displaced in their own ancestral homeland--the only home
    they have ever known.
        The CNMI Women's Association acknowledges the plan under Public law
    110-229 to phase-out alien workers in the CNMI by November 28, 2011 and
    then the final transition period in December 31, 2014.
        House Resolution 1466, introduced by U.S. Delegate Gregorio C.
    `Kilili' Sablan, NMI-at-large, introduces four types of categories that
    aliens can gain improved status. Furthermore, H.R. 1466 will allow also
    11,000 and possibly more new U.S. citizens in the CNMI within 10 years
    or less. Some may state that this number is small compared to the
    immigrants in the U.S., but one must understand that there are
    currently 30,000 U.S. citizens residing in the CNMI most of whom are
    Chamorro and Carolinian. Additionally, according to the U.S.
    Ombudsman's Office in the CNMI, there are approximately 23,000 aliens
    residing in the CNMI, excluding their children. Subsequently, it is
    arguable that there are more aliens residing in the CNMI than there are
    indigenous Chamorro and Carolinians. Unfortunately, many agencies over
    the years have failed to control the immigration of aliens into the
    CNMI. However, the indigenous people acknowledge the need to stop this
    massive increase of aliens and the possibility of displacing indigenous
    people of the CNMI. House Resolution 1466 is not the best solution to
    address the 23,000 aliens in the CNMI.
        According to the information provided by the CNMI Commonwealth
    Health Center, from calendar year 1990 to May 2011, out of 31,180 live
    births, 18,431 were of Filipino, Chinese, Korean, Japanese, Thai,
    Indian, Nepalese, Bangladesh Taiwanese, Vietnamese, Malaysian, Burmese,
    and Sri Lankan descent. That is more than half and almost 60% of total
    live births during a ten year period. This appalling number of
    18,481live births of aliens in the CNM has begun to disenfranchise the
    local indigenous population.
        Based on the said numbers, H.R. 1466 will have a negative impact on
    the amount of social programs that will be available to the local
    residents. A bothersome fact for many people in the CNMI is that H.R.
    1466 fails to address such devastating problem for local U.S. citizen
    residents.
        A true story: A single mother, family of four, only receives $136
    in food stamp benefits. She used to receive $250, which decreased to
    $196, and now at $136. This mother of four, works two jobs, and allows
    her 15 year old son to watch over his three siblings while the mother
    goes to work.
        One possible reason behind this decline is the additional hundreds
    of new qualified applicants for food stamps, including aliens with
    children born in the CNMI. On July 11, 2011 as published in the local
    newspaper, Marianas Variety, the Department of Community and Cultural
    Affairs Secretary Melvin Faisao states, ``that more than 500 people
    eligible for food stamp benefits were on a waiting list. . .there are
    about 9,700 residents receiving assistance from the Supplemental
    Nutrition Assistance Program.'' Within the past year, part of the
    agreement with the U.S. Department of Agriculture, SNAP benefits
    decreased by 26.7% in food stamp benefits. Now, does House Resolution
    1466 address this issue? It does not.
        Consequently, H.R. 1466 will also place the local indigenous
    population at a disadvantage in terms of employment and voting in local
    elections. Before Public Law 110-229, the CNMI immigration office
    mirrored laws to that of the federal immigration pertaining to
    sponsorship. According to the CNMI law, only those non-resident aliens
    who could sponsor their spouses were those who were identified as
    ``professionals.'' Any non-resident alien who were identified as
    ``professionals'' had to have earned an annual salary of over $20,000.
    Many aliens residing in the CNMI today make much less than $20,000.
        It is the purpose of the CNMI Women's Association to bring forth to
    your committee that H.R. 1466 may seem like a plausible humanitarian
    bill, which in actuality is the opposite and more harmful for the
    indigenous people. Not only will H.R. 1466 displace thousands of
    indigenous Chamorro and Carolinian people, it will also deprive them of
    full potential benefits from social programs and another small benefits
    provided by the CNMI government especially during our severe declining
    economy.
        Chairman Fleming, we humbly and sincerely ask your committee to
    think of our indigenous Chamorro and Carolinian people of the CNMI, who
    have been colonialized and oppressed for over 500 years, to please
    reject House Resolution 1466.
        Un dangkulu na si yu'us ma'ase--Ghilisoow--Thank you.

                           --------------------------

        The written and oral testimonies during the Senate Committee on
    Federal Relations and Independent Agencies' public hearings on Public
    Law 110-229 and other matters can be accessed at: http://
    www.cnmileg.gov.mp/resources/files/
    Official_Senate_Recommendation_Appendices_A_thru_F.pdf. From page 21-
    365.
                                     ______

     Statement of The Honorable Paul A. Manglona, President of the Senate,
       Seventeenth Northern Marianas Commonwealth Legislature, on ``The
    implementation of P.L. 110-229, the Consolidated Natural Resources Act
     of 2008 and a legislative hearing on H.R. 1466, a bill to resolve the
    status of certain persons residing the CNMI under the immigration laws
                             of the United States''

        Good morning Chairman Fleming and members of the Subcommittee. I am
    Senator Paul A. Manglona, Senate President of the Seventeenth Northern
    Marianas Commonwealth Legislature. Thank you for the opportunity to
    submit my written testimony on the implementation of Public Law 110-
    229, the Consolidated Natural Resources Act of 2008 and H.R. 1466, a
    bill to resolve the status of certain person legally residing in the
    Commonwealth of the Northern Mariana Islands (CNMI) under the
    immigration laws of the United States. Although I previously testified
    before this Subcommittee in the 111th U.S. Congress on the same issue,
    the CNMI Senate appreciates this Subcommittee's consideration on the
    implementation of Public Law 110-229 in the CNMI as well as other
    matters concerning the CNMI.
    I. Implementation of Public Law 110-229 to the CNMI Generally
        Public Law 110-229, the Consolidated Natural Resources Act of 2008,
    was signed into law on May 8, 2008. The Congressional intent of Public
    Law 110-229 was to extend the U.S. Immigration and Nationality Act
    (INA) to the CNMI with special provisions to allow the orderly phasing-
    out of the nonresident contract worker program of the CNMI and the
    orderly phasing-in of federal responsibilities over immigration in the
    CNMI. See Public Law 110-229, Title VII, Subtitle A, SEC. 701(a)(1)
    codified as 48 USC 1806.
        Federal immigration laws were to become applicable to the CNMI one
    year after the date of enactment of PL 110-229 on May 8, 2008
    (transition program effective date). See Public Law 110-229, Title VII,
    Subtitle A, SEC. 702(a) codified as 48 USC 1806((a)(1). However, the
    Secretary of Homeland Security was given discretion to delay the
    transition program effective date for a period not to exceed 180 days
    after such date. See 48 USC 1806(a)(3). On March 31, 2009, Secretary of
    Homeland Security Janet Napolitano exercised her discretion pursuant to
    PL 110-229 and extended the transition program effective date for
    another six months to November 28, 2009. Section 1806(a)(2) further
    provided for a transition period beginning the transition program
    effective date (November 28, 2009) and ending on December 31, 2014
    during which the Secretary of Homeland Security shall establish,
    administer, and enforce a transition program to regulate immigration to
    the CNMI (transition program). The implementation of Public Law 110-229
    created significant changes in the CNMI and has impacted all aspects of
    the CNMI government and economy. Below are some areas that were
    severely affected by the implementation of Public Law 110-229.
        A. Generally. Public Law 110-229 superseded the local immigration
    laws of the CNMI, which immediately resulted in the displacement of
    over 70 CNMI immigration employees. Many of the displaced employees
    worked for the CNMI government for ten years or more and a few
    employees were close to completing the required CNMI retirement
    service. The implementation of PL 110-229 further caused the CNMI
    government to lose approximately $5,000,000 in revenue collected each
    year from nonresident worker fees beginning fiscal year 2010. The loss
    of nonresident worker fees has dramatically reduced our annual budget.
    For FY2010, the CNMI budget was $135M and in FY2011 our budget was
    $105M. The CNMI is in dire straits financially and its economy
    continues to decline each year. Although the law authorizes the
    Secretary of Homeland Security to impose an annual supplemental fee of
    $150 per alien worker on employers under the CNMI transitional worker
    program, the fees can only be used to develop vocational and
    educational programs by CNMI educational entities, not for general
    purposes to augment the loss of government revenue.
        B. CNMI Prevailing Wages. Public Law 110-229 does not discuss which
    ``prevailing wages'' to be applied in the CNMI transitional worker visa
    program. However, the U.S. Department of Labor requires the prevailing
    wages of an occupation to be applied to H category visa workers.
    Pursuant to US Public Law 110-28, federal minimum wages became
    applicable to the CNMI in gradual increments of $ .50 per year until it
    reaches the actual federal minimum wage. Today, the CNMI-federal
    minimum wage is $5.05 per hour and will be increased to $5.55 in
    September 30, 2012.
        The CNMI's prevailing minimum wages for all occupations are far
    lower than that of the United States due to the low minimum wage. The
    Guam Department of Labor is authorized to conduct wage surveys for H2B
    workers, which must be approved by U.S. Citizenship and Immigration
    Services (USCIS). The Saipan Chamber of Commerce is presently working
    on a CNMI prevailing wage survey which, among other things, is needed
    by CNMI employers to support their applications for U.S. work visas for
    their foreign employees. The survey will provide valuable data for the
    process of determining prevailing wage rates for individual job
    classifications, while petitioning for foreign labor work visas under
    the new requirements of the USCIS and the U.S. Department of Labor's
    Foreign Labor Certification Office. The CNMI Governor will be
    commissioning its own prevailing wage study to ensure that the end
    results are fair and impartial. I recommend that the U.S. Department of
    Labor grant the Governor of the CNMI the same certifying authority and
    apply CNMI prevailing wages for its alien workers under any visa
    classification.
        C. CBP Lack of Professionalism. Since the time the U.S. Customs and
    Border Protection (CBP) took over the immigration functions of the CNMI
    Division of Immigration, there have been numerous complaints regarding
    long lines, delays, and the demeanor of CBP officials at the Saipan
    International Airport. Unfortunately, two senators and I witnessed
    these complaints first hand on April 16, 2011 when we returned from a
    business trip in Korea. Upon our arrival, the CBP officers were not
    prepared and all the passengers had to stand in line for about 15
    minutes. Also, a CBP Officer was rude and abrasive to the pilot and
    crew. In the United States, the pilot and crew are usually given first
    class treatment and cleared through immigration without delay and
    hesitation. It should not be any different on Saipan.
        Moreover, CBP officers took at least 10-15 minutes to clear each
    passenger. The CBP officers did not seem too concerned about the
    passengers standing in line who have been traveling a long distance to
    get to Saipan. The Asiana Airlines agent present at the Saipan
    International Airport informed us that the appalling treatment of the
    pilot, crew, and passengers from China by CBP officials is a regular
    occurrence at the airport. We understand and appreciate CBP's mandate
    to protect the American borders. However, the CNMI's ailing economy is
    heavily dependent on foreign investors and tourists to stimulate
    commerce. The treatment of visiting investors and tourists is crucial
    to the survival of our tourism industry. Investors and tourists must
    feel welcomed as soon as they set foot on our islands. The officers
    must do their job diligently and efficiently.
        Moreover, PL110-229 provides that ``it is the intent of the
    Congress that the Commonwealth be given as much flexibility as possible
    in maintaining existing businesses and other revenue sources, and
    developing new economic opportunities, consistent with the mandates of
    [Title VII, Subtitle A).'' CBP officers are required to fulfill the
    U.S. Congress' intent in implementing U.S. Immigration policies in the
    CNMI. In order to ``expand tourism and economic development,'' CBP
    officers must conduct themselves professionally and courteously and
    refrain from abrasive and unwelcoming remarks and actions towards
    visitors from China and other foreign countries.
        On May 13, 2011, CBP Deputy Commissioner David V. Aguilar responded
    to the Senate's complaint regarding the April 16, 2011 incident.
    Commissioner Aguilar had many excuses for the poor service and lack of
    professionalism of CBP officials that day. However, as I stated
    earlier, the Asiana Airlines agent present at the airport reported that
    the appalling treatment was a regular occurrence and the Senate and
    other public officials have received countless complaints regarding the
    same unacceptable behavior of CBP officials at the Saipan International
    Airport. Please conduct an official investigation into this matter to
    ensure that CBP officials refrain from objectionable conduct and
    treatment of U.S. citizen and non-citizen passengers at the airport and
    seaports of the CNMI.
    II. Implementation of Public Law 110-229 as to Foreign Investors and
            Businesses
        The CNMI heavily relies on foreign investors for its businesses and
    economic growth. As such, the implementation of Public Law 110-229
    created a ``freeze'' on new investments in the CNMI due to the
    uncertainty of foreign investors' status under the law. Foreign
    investors were reluctant to invest even the smallest amount not knowing
    if their investments would be lost during the transition period. The
    freeze on new foreign investments has stifled economic growth and
    reduced the government revenues by the millions.
        Public Law 110-229 authorizes the Secretary of Homeland Security to
    classify, during the transition period, a foreign investor in the CNMI
    as an E-2 nonimmigrant investor. On December 17, 2010, USCIS published
    final regulations with respect to investors, which allows foreign long-
    term investors to reside in the CNMI through December 2014 in CNMI E-2
    nonimmigrant investor status. This rule temporarily resolves the
    immigration status of long-term investors in the CNMI and provides them
    time in which to obtain another lawful immigration status under the
    provisions of the Immigration and Nationality Act (INA).
        At the end of December 2014, the transition period will expire and
    the E-2 CNMI investor status and visa will expire. Therefore,
    individuals in the CNMI with E-2 CNMI status must depart the CNMI at
    the end of the transition period or qualify for and obtain another
    nonimmigrant or immigrant status in order to lawfully remain in the
    CNMI. The CNMI-only investor status ends at the end of the transition
    period regardless of whether an extension to the transitional worker
    provision occurs. Any extension by the Secretary of Labor will apply
    only to the CNMI transitional worker category.
        To qualify for E-2 CNMI Investor status, the primary applicant
    must: (1) Have been admitted to the CNMI with a long-term investor visa
    under CNMI immigration law before Nov. 28, 2009; (2) Have continuously
    maintained residence in the CNMI under long-term investor status; (3)
    Currently maintain the investment(s) that formed the basis for the CNMI
    long-term investor status; and (4) Otherwise be admissible to the
    United States under the INA.
        Individuals who were admitted to the CNMI in long-term investor
    status under CNMI immigration law qualify, specifically: (1) A long-
    term business investor who was issued a long-term business certificate
    by the CNMI based upon an investment of at least $50,000; (2) A foreign
    investor with a foreign investment certificate issued by the CNMI based
    upon an investment of at least $100,000 in an aggregate approved
    investment in excess of $2 million or at least $250,000 in a single
    approved investment; and (3) A retiree investor over the age of 55
    years who was issued a foreign retiree investment certificate based
    upon a qualifying investment in an approved residence in the CNMI (but
    not including the 2-year non-renewable retiree investor program limited
    to Japanese nationals).
        The final rule implements the CNMI nonimmigrant investor visa
    provisions of Public Law 110-229 during the transition period only,
    after which CNMI E-2 investors would need to apply for another
    nonimmigrant status under the INA, such as the E-2 treaty investor
    visa. However, as noted by USCIS, a majority of CNMI investors would
    not meet the requirements for such treaty-visas. As stated in its
    comments in the federal register, ``a review of the CNMI eligibility
    criteria and anecdotal evidence indicates that many of (the current
    CNMI foreign investors) would not meet the minimum financial investment
    necessary to be eligible for U.S. E-2 status.''
        Moreover, an E-2 ``treaty investor must be a national of a country
    with which the United States has a treaty of friendship, commerce, or
    navigation and must be entering the United States pursuant to treaty
    provisions.'' This will have a significant and detrimental effect on
    the CNMI economy as foreign investors, who fail to qualify for the E-2
    visas after the transition period, will be forced to pick up their
    assets and relocate. Chinese and Russian investors in particular will
    be negatively impacted at the conclusion of the transition period and
    risk the loss of substantial investment in the CNMI.
        Pursuant to the INA, the Treaty Trader (E-1) visa or Treaty
    Investor (E-2) visa is for ``a national of a country with which the
    U.S. maintains a treaty of commerce and navigation who is coming to the
    U.S. to carry on substantial trade, including trade in services or
    technology, principally between the U.S. and the treaty country, or to
    develop and direct the operations of an enterprise in which the
    national has invested, or is in the process of investing a substantial
    amount of capital, under the provisions of the Immigration and
    Nationality Act.'' E-2 visa holders must be nationals from a list of
    participating treaty countries. Notably absent from this list are
    Chinese and Russian nationals who make up a substantial and growing
    segment of the CNMI foreign investor population.
        Many of the current foreign investors residing in the CNMI will
    fail to meet the financial threshold for investment and other E-2 visa
    requirements once the transition period has expired. Over the decades,
    the small business community in the islands has been built by foreign
    investors, including but not limited to supermarkets, restaurants, and
    tourism related industries. It is debatable whether it may be in the
    best interests of the CNMI to have U.S. citizen investors fill these
    niches, and it certainly cannot be guaranteed. Our proximity to Asia
    has made the CNMI reliant on these foreign economies, and investors,
    and it is unlikely U.S. investors will be able to fill this void in the
    short-run. At a minimum, a majority of foreign small business owners
    will have to sell businesses that they have spent their lives building,
    and as a consequence eliminating a significant portion of the CNMI
    economy.
        Further, current CNMI foreign retiree certificate holders will not
    qualify as U.S. E-2 investors after the transition period given the
    current E-2 visa requirements. These foreign retirees will be subject
    to the same visa requirements of other E-2 visa holders, post
    transition period. Elderly foreign retirees have made significant
    investments in CNMI homes. To revoke their status would be a hardship
    on these individuals and a detriment to the CNMI economy.
        Public Law 110-229 intended to apply federal immigration laws to
    the CNMI while minimizing to the greatest extent practicable the
    potential adverse economic and fiscal effects and to maximize the
    CNMI's potential for future economic and business growth. See SEC. 701.
    Public Law 110-229's Congressional intent of maximizing the CNMI's
    potential for economic and business growth during the implementation of
    federal immigration laws to the CNMI could be achieved by the
    following:
            1.  Maintain the final rule CNMI only E-2 visas eligibility
            requirements after the transition period.
            2.  Grandfather in foreign retirees or create CNMI-only foreign
            retiree visa.
            3.  Grant Treaty Investor waiver for Chinese and Russian
            nationals.
        Similar to the tourist visa waiver for Chinese and Russian
    nationals entering the CNMI, it is recommended that Russian nationals
    presently holding CNMI foreign investor certificates, or CNMI long-term
    business certificates, be allowed E-2 Treaty Investor status as
    provided to participating treaty member countries. It is suggested that
    this be applied on a CNMI only basis.
    III. Implementation of Public Law 110-229 as to Alien Workers
    A. Lack of Regulations for CNMI Transitional Worker Visa Classification
        PL 110-229 requires DHS to promulgate regulations to implement the
    provisions of the law. It is now July 2011, more than three years after
    the enactment PL 110-229 and more than one year since I testified
    before this subcommittee in the 111th U.S. Congress and pleaded for
    USCIS to publish the CNMI Transition Worker regulations so the CNMI and
    its businesses can prepare for the transition program. It is
    unacceptable and outrageous that USCIS has not filed the transitional
    worker visa final interim rules. The fact that USCIS had draft interim
    rules in October 2009 makes it even more difficult to understand why
    the rules are still pending with the Administration at this time. PL
    110-229 clearly mandates all federal agencies to comply with Congress
    intent to implement the law giving the CNMI as much flexibility as
    possible in maintaining existing businesses and other revenue sources,
    and developing new economic opportunities consistent with the mandates
    of Title VII, Subtitle A.
        USCIS must publish final rules on the transitional worker visa for
    the CNMI in a timely manner to afford the CNMI government, employers,
    and employees the opportunity to comment on the regulations before they
    take effect. The final regulations must consider and address the
    adverse and detrimental consequences, if any, of the proposed
    regulations. For example, it is crucial that the hotel hospitality
    alien workers be able to continue working under the regulations while
    training U.S. citizens and permanent residents to takeover such
    positions.
        USCIS's failure to publish the final interim rules at this time is
    a violation of PL 110-229 and an example of the continued lack of
    respect and candor by the agencies of the Department of Homeland
    Security. The CNMI and the businesses should not be held hostage by
    DHS' inability to timely carry out its mandate set forth in PL 110-229.
    Once again, USCIS has failed to give the CNMI more than ample time to
    comment on the transitional worker regulations. There is only four
    months left before the regulations take effect. Four months is
    insufficient time for employees and employers to prepare for the
    changes in the transitional worker regulations. As such, I request this
    subcommittee to amend PL 110-229 to extend the employment authorization
    grandfather provision set forth in SEC. 6(e)(2)(B) from two years after
    the transition program effective date to three years after the
    effective date. This will give employers and employees more time to
    adjust to the new regulations that will become effective on November
    27, 2011. Extending the employment authorization grandfather provision
    is different from extending the transition period which commenced on
    November 28, 2009 and will expire on December 31, 2014, unless extended
    by the Secretary of Labor. Extending the employment authorization
    grandfather provision will allow the existing nonresident workers to
    continue working in the CNMI under the umbrella permit conditions for
    one more year after November 27, 2011.
    B. ICE not Deporting Overstayers in the CNMI
        Public Law 110-229 provides that no alien lawfully admitted under
    CNMI immigration laws shall be removed from the CNMI until the earlier
    of the expiration date of the alien's employment authorization or 2
    years after the transition program effective date, which is November
    28, 2009. The law further authorizes the Secretary of Homeland Security
    to remove any alien from the CNMI who is removable under federal law
    except as provided herein. Moreover, the Secretary may execute
    administrative orders to remove aliens under U.S. or CNMI law prior or
    after November 28, 2009.
        In 2009, the CNMI Department of Labor provided U.S. Immigration and
    Customs Enforcement (ICE) with the names and identification of over
    1,300 illegal or overstaying aliens in the CNMI. In the last three
    years, ICE has deported fewer than 100 aliens. Moreover, although ICE
    does not have its own exit data base, ICE has prevented the CNMI from
    maintaining an exit database of passengers necessary to identify
    overstaying tourists. Since the implementation of federal immigration,
    it appears that we have an increase in the number of overstaying alien
    workers, family members, and tourists.
    IV. Guam-CNMI Visa Waiver Program
        The CNMI's only industry today--the tourist industry--has
    tremendously declined since the enactment of Public Law 110-229 on May
    8, 2008. The CNMI's tourist arrivals decreased after the enactment of
    Public Law 110-229 especially from the Russian and Chinese markets. The
    decreased tourist arrival translates into low hotel occupancy, low
    tourist-related activities, low business gross receipt taxes, and less
    revenue for the CNMI.
        Public Law 110-229 replaces the existing Guam Visa Waiver Program
    with a new Guam-CNMI Visa Waiver Program at INA Sec. 212(l). The law
    extends the authorized period of stay under the Guam-CNMI Visa Waiver
    Program from 15 to 45 days. As of November 28, 2009, U.S. immigration
    law applies to the CNMI and the Guam-CNMI Visa Waiver Program is in
    effect; and DHS, Customs and Border Protection operate ports of entry
    in the CNMI for immigration inspection of arriving aliens and establish
    departure control for certain flights leaving the CNMI.
        The major CNMI tourist markets are Japanese, Koreans, Chinese, and
    Russians. Under CNMI immigration laws, Chinese and Russian nationals
    were allowed to visit the CNMI for up to ninety-days without a visa.
    However, the new regulations on the Guam-CNMI Visa Waiver program do
    not include the Chinese and Russian nationals. As such, these nationals
    are required to apply for a visitor's visa to enter the CNMI. This
    posed a great threat to the CNMI's only industry at this time--its
    tourist industry. The Chinese and Russian tourists represent a large
    portion of CNMI visitors. In order to preserve such tourist markets,
    the Governor of the CNMI requested DHS for a visa waiver for these
    tourists.
        Public Law 110-229 authorizes the Secretary of Homeland Security to
    promulgate regulations that include a listing of all countries whose
    nationals may obtain the visitor's visa waiver. Public Law 110-229
    further requires the Secretary to provide a listing of any country from
    which the CNMI has received a significant economic benefit from the
    number of visitors for pleasure within a one year period preceding the
    enactment of the law unless US welfare or security is threatened. The
    Department of Homeland Security determined that the People's Republic
    of China (PRC) and Russia meet this economic threshold.
        Accordingly, on October 21, 2009, the Secretary of Homeland
    Security announced that she will exercise her discretionary authority
    to parole Chinese and Russian visitors into the CNMI for business or
    pleasure. Parole will be authorized on a case-by-case basis only for
    entry into the CNMI and will not extend to other areas of the United
    States. While the CNMI appreciates the Secretary's decision to parole
    Chinese and Russian visitors into the CNMI, I recommend that a more
    permanent arrangement be established such as amending the regulations
    to add China and Russia to the list of visa waiver countries. The CNMI
    needs its Chinese and Russian tourists indefinitely to keep the economy
    afloat. Making it difficult for these tourist markets to visit the CNMI
    will detrimentally affect the industry. Economic growth in the CNMI
    cannot be achieved without our Chinese and Russian markets.
    V. Technical Assistance for the CNMI
        Public Law 110-229 mandates that the Secretary of the Department
    Interior (DOI) provide technical assistance to the CNMI to advance
    recruitment of U.S. citizens. The law states that technical assistance
    and other support to the CNMI shall be provided to identify
    opportunities for, and encourage diversification and growth of, the
    economy of the Commonwealth. This technical assistance shall also
    include assistance in recruiting, training, and hiring of workers to
    assist employers in the CNMI in securing employees first from among the
    U.S. citizens in the CNMI. The law also provides that federal
    assistance should further include the identification of the types of
    jobs needed, identify skills needed to fulfill such jobs, and
    assistance to Commonwealth educational entities to develop curricula
    for such job skills.
        In May 2011, the Department of the Interior, Office of Insular
    Affairs issued a report entitled ``Guidance for the Design and
    Implementation of Technical Assistance Program Relating to Immigration
    in the CNMI Required under Title VII, Public Law 110-229, Consolidated
    Natural Resources Act, May 2008.'' The report outlines DOI's plan for
    technical assistance to the CNMI. In November 2010, the Assistant
    Secretary of the Interior for Insular Affairs held a public meeting,
    Forum on Economic and Labor Development (FELD), on Saipan. This was an
    opportunity for all stakeholders to begin a discussion on what types of
    assistance would be appropriate and made available to the CNMI.
        PL 110-229 does not appropriate funds for the aid it mandates. The
    Office of Insular Affairs (OIA) has committed up to $1 million in
    financial aid, from existing technical assistance funds, to fill the
    requirements of the law. OIA funds will be devoted to two main
    programs: (a) assisting the CNMI to develop an economic revitalization
    program as suggested by the Governor of the CNMI, and (b) enabling the
    CNMI government to work with local agencies and non-profit
    organizations to provide on-the-job training for eligible U.S. workers.
        Using the FELD's list as the guide, OIA designated areas of the
    economy and the labor market for technical assistance grants that would
    generate the greatest possible benefit for the CNMI. Primary areas to
    receive first priority for assistance are: tourism, which is the CNMI's
    largest income source and has growth potential; the labor market, which
    currently relies on foreign labor and whose stability is crucial to the
    transition and beyond; and renewable energy, agriculture and
    aquaculture, which reduce dependence on fossil fuels, contribute to
    food supply and create jobs. OIA's technical assistance will be
    committed to these areas. Although not the first priority, OIA has
    identified other areas of concern to be the health care industry,
    education, transportation, and communication
        While the Senate appreciates all the technical assistance provided
    by OIA, the pledge of $1 million dollars in financial aid to the CNMI
    is insufficient to provide technical assistance in the tourism industry
    and labor market. The DOI's report suggests that the CNMI tourism
    industry would benefit from better trained hospitality staff and
    lessons can be learned from Hawaii's hospitality industry. The report
    further suggests that the labor market must be seen as a critical
    component with emphasis on training and vocational skills. These DOI
    suggestions cannot be achieved with $1 million financial aid. It will
    cost millions and many years to accomplish these goals. I request that
    the U.S. Congress appropriate funds for the technical assistance
    mandate under to PL 110-229. The federal government must be cognizant
    of the fact that the immigration and technical assistance mandates of
    PL 110-229 were established by the U.S. Congress but not funded
    accordingly.
    VI. Senate Recommendation for Improved Status of Guest Workers in the
            CNMI
        Public Law 110-229 requires the phasing-out of the CNMI's
    nonresident contract worker program by turning over responsibility for
    immigration to the Federal government. As required by PL 110-229, the
    Secretary of the Interior submitted a report to the U.S. Congress in
    April 2010 on the current status of the nonresident contract worker
    program and recommendations on how best to implement the law in the
    Commonwealth. Additionally, the U.S. Congress held an oversight hearing
    on the implementation of PL 110-229 and invited elected officials from
    the CNMI and Guam to testify.
        At the hearing in May 2010, Governor Benigno R. Fitial, Chairman
    Frederick DL. Guerrero of the CNMI House Committee on Federal and
    Foreign Affairs and I testified before this Subcommittee on the
    implementation of P.L. 110-229 in the CNMI. The Senate was concerned
    that the leaders and people of the Commonwealth were not consulted in
    the Department of the Interior's report and its recommendations as
    required by PL 110-229.
        In response to these concerns, the CNMI Senate Committee on Federal
    Relations and Independent Agencies held public hearings on the islands
    of Rota, Saipan, and Tinian, in June and July of 2010, regarding the
    implementation of Public Law 110-229. The public was overwhelmingly
    alarmed about offering so many nonresident workers an immigration
    status that would allow them to become citizens of the United States in
    the CNMI, and the effect it would have on the status and rights of
    citizens who are of Northern Marianas Descent (NMD or Indigenous).
    Several months after the hearings, the CNMI Senate produced a
    preliminary draft recommendation and scheduled hearings to gauge public
    sentiment. At the latest hearings in February 2011, indigenous
    residents and nonimmigrant workers reacted to the Senate's
    recommendation stated in this report. We produced this final report as
    a compromise between the interests of nonimmigrant workers and
    indigenous residents of the Commonwealth.
        The CNMI Senate offered the following recommendation to the U.S.
    Congress: all aliens residing legally in the Commonwealth of the
    Northern Mariana Islands for ten years on the date U.S. Public Law 110-
    229 became law, shall receive similar immigration status as that held
    by citizens of the freely associated states (FAS) as set forth in U.S.
    Public Law 99-229. The Senate presented its report to Chairman Fleming
    and other members of Congress at a meeting in Washington, D.C. in March
    2011.
        The CNMI Senate made this recommendation acknowledging that persons
    who receive improved immigration status will be eligible for social
    welfare benefits, at a time when our economy is facing a major
    recession. CNMI revenues are negatively impacted by changes in federal
    law. For example, federalization of immigration means the U.S., not the
    CNMI, Department of Labor, now collect revenues from licensing and
    permitting nonimmigrant workers, resulting in a loss to the
    Commonwealth of nearly $5 million dollars annually. We encourage the
    U.S. to consider this impact, and appropriate the funds necessary to
    maintain sufficient federal benefits for our citizens.
    VII. Senate Supports the Passage of H.R. 1466
        In the 112th U.S. Congress, First Session, Congressman Gregorio
    Kilili Sablan introduced H.R. 1466--To resolve the status of certain
    persons legally residing in the Commonwealth of the Northern Mariana
    Islands under the immigration laws of the United States. The purpose of
    this Act is to provide to certain persons residing in the CNMI an
    immigration status applicable solely within the CNMI in order to allow
    such persons to remain lawfully in the CNMI. There are four groups of
    persons affected by this Act: (I) Aliens born in the CNMI between
    January 1, 1974 and January 9, 1978; (II) Aliens who were on May 8,
    2008, permanent residents as defined in 3 CMC Sec. 4303; (III) alien
    spouses and children of aliens described in subclasses (I) and (II);
    and (IV) Aliens who were on May 8, 2008, immediate relatives [as
    defined by 3 CMC Sec. 4303] of a U.S. citizen notwithstanding the age
    of the U.S. citizen. Pursuant to the Act, the aliens in subclasses (I)-
    (III) shall be eligible to apply for permanent resident status between
    January 1, 2015 and January 1, 2016. The aliens in subclass (IV) shall
    be able to apply for permanent resident status when the U.S. citizen
    immediate relative reaches 21 years of age.
        The Senate supports the passage of this bill with amendments. Most
    of the aliens under subclasses (I)-(III) have been in the CNMI at least
    twenty years and would also qualify for special status under the
    Senate's recommendation as set forth above. Moreover, the immediate
    relatives in subclass (IV) should be allowed to stay together with
    their U.S. citizens relatives in the CNMI until such time that the U.S.
    citizen may petition for the adjustment of the status of his or her
    immediate relatives. However, the Senate requests that H.R. 1466 be
    amended to require certain conditions for subclass (IV) such as the
    immediate relative shall be lawfully admitted in the CNMI, the
    immediate relative must have continuously maintained residence in the
    CNMI for at least five years prior to May 8, 2008, and any other
    condition as may be required by Congress. The Senate believes that
    these conditions will ensure that this special status conferred by H.R.
    1466 will be limited to those lawfully admitted aliens residing in the
    CNMI. Moreover, if practical, the Senate further requests that H.R.
    1466 be amended to include the CNMI Senate's recommendation for the
    improved status of guest workers in the CNMI as set forth in Section
    VII of this testimony.
    VIII. Conclusion
        Based on the foregoing reasons, the Senate submits that without
    proper consideration for the CNMI's employment requirements, present
    economic needs and future economic growth as mandated by Public Law
    110-229, the implementation of the law will continue to adversely
    impact the CNMI government and business sectors. The Congressional
    intent of the law extends federal immigration laws to the CNMI with
    special provisions to allow for the orderly phasing-out of the alien
    worker program of the CNMI and the orderly phasing-in of federal
    responsibilities over immigration in the CNMI, and to minimize to the
    greatest extent practicable, the potential adverse economic and fiscal
    effects of phasing-out the alien worker program and to maximize the
    CNMI's potential for future economic and business growth.
        The Senate submits that the Congressional Intent of Public Law 110-
    229 can be achieved if federal agencies adhere to and adopt regulations
    consistent with such intent. I recommend that this subcommittee
    authorize grandfathering into the federal system existing CNMI foreign
    investors and retirees to preserve those economic markets and grow the
    economy. Without these measures, the CNMI would lose most, if not, all
    of its foreign investors and businesses. Moreover, we need further
    clarification on the ``prevailing wages'' that will be applied to alien
    workers in the CNMI. The Saipan Chamber of Commerce and CNMI government
    are working on a ``CNMI Prevailing Wage'' survey to determine the
    appropriate wages to apply to the transitional worker program.
        The Senate further recommends that this subcommittee direct the
    Department of Homeland Security to (1) collaborate and work with the
    Governor of CNMI on the implementation and enforcement of Public Law
    110-229, (2) publish final regulations regarding the transitional
    worker visas in a timely manner to allow the CNMI to comment and
    recommend changes, if any; the CNMI must maintain its current
    employment workforce to maintain and grow the economy, (3) authorize
    visa waivers for Russia and China, (4) address the issue of overstayers
    in the CNMI, and (5) treat our residents and visitors with respect and
    courtesy when they enter the CNMI at the airport and seaports.
        Finally, due to USCIS's delay in timely publishing the transitional
    worker regulations, the Senate requests that the U.S. Congress amend PL
    110-229 to extend the employment authorization grandfather provision to
    three years after the transition period effective date to give
    employers and employers at least one year to adjust and train employees
    to transfer to transitional worker program. The Senate further requests
    that the U.S. Congress appropriate funds necessary to carry out the
    technical assistance mandate of PL 110-229 and instruct the Department
    of Interior to work closely with the CNMI government and the
    stakeholders on the technical assistance program by providing
    additional financial aid for job training, business diversification,
    and economic growth. The CNMI needs more than $1 million in technical
    assistance financial aid to accomplish the training and diversification
    necessary to implement PL 110-229 while simultaneously growing the
    economy. At a minimum, fulfillment of these requests and
    recommendations would make the implementation of Public Law 110-229
    more efficient and workable. Thank you for your time and consideration
    of the CNMI's issues and concerns regarding the implementation of PL
    110-229 and H.R. 1466.