[Senate Hearing 117-460]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 117-460

                   THE STATE OF THE U.S. TERRITORIES

=======================================================================

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            FEBRUARY 1, 2022

                               __________




                 [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]






                       Printed for the use of the
               Committee on Energy and Natural Resources

        Available via the World Wide Web: http://www.govinfo.gov







         
                               ______
                                 

                 U.S. GOVERNMENT PUBLISHING OFFICE

46-846                    WASHINGTON : 2024












               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                JOE MANCHIN III, West Virginia, Chairman

RON WYDEN, Oregon                    JOHN BARRASSO, Wyoming
MARIA CANTWELL, Washington           JAMES E. RISCH, Idaho
BERNARD SANDERS, Vermont             MIKE LEE, Utah
MARTIN HEINRICH, New Mexico          STEVE DAINES, Montana
MAZIE K. HIRONO, Hawaii              LISA MURKOWSKI, Alaska
ANGUS S. KING, JR., Maine            JOHN HOEVEN, North Dakota
CATHERINE CORTEZ MASTO, Nevada       JAMES LANKFORD, Oklahoma
MARK KELLY, Arizona                  BILL CASSIDY, Louisiana
JOHN W. HICKENLOOPER, Colorado       CINDY HYDE-SMITH, Mississippi
                                     ROGER MARSHALL, Kansas

                      Renae Black, Staff Director
                      Sam E. Fowler, Chief Counsel
              Melanie Thornton, Professional Staff Member
             Richard M. Russell, Republican Staff Director
              Matthew H. Leggett, Republican Chief Counsel
       Brian Clifford, Republican Principal Deputy Staff Director








                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Manchin III, Hon. Joe, Chairman and a U.S. Senator from West 
  Virginia.......................................................     1
Marshall, Hon. Roger, a U.S. Senator from Kansas.................     2

                               WITNESSES

Bryan, Jr., Hon. Albert, Governor, U.S. Virgin Islands...........     3
Guerrero, Hon. Lourdes A. Leon, Governor, Guam...................    41
Mauga, Hon. Lemanu P.S., Governor, American Samoa................    49
Pierluisi, Hon. Pedro R., Governor, Puerto Rico..................    54
Atalig, David DLG., Secretary of Finance, Commonwealth of the 
  Northern Mariana Islands.......................................    62

          ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Aponte-Hernandez, Jose F.:
    Letter for the Record........................................   117
Atalig, David DLG.:
    Opening Statement............................................    62
    Questions for the Record.....................................   114
Bryan, Jr., Hon. Albert:
    Opening Statement............................................     3
    Written Testimony............................................     6
    Responses to Questions for the Record........................    90
Buxo, Zoraida:
    Letter for the Record........................................   121
(The) Center for Popular Democracy and the Action Center on Race 
  & the Economy:
    Report entitled ``PROMESA Has Failed: How a Colonial Board Is 
      Enriching Wall Street and Hurting Puerto Ricans'' dated 
      September 2021.............................................   130
Fortuno, Roberto Lefranc:
    Letter for the Record........................................   207
Freytes, Dennis O.:
    Statement for the Record.....................................   209
Garffer, Art:
    Statement for the Record.....................................   216
Guerrero, Hon. Lourdes A. Leon:
    Opening Statement............................................    41
    Written Testimony............................................    43
    Responses to Questions for the Record........................    92
Irizarry Remus, Nestor J. et al:
    Letter for the Record........................................   244
Manchin III, Hon. Joe:
    Opening Statement............................................     1
Marquez, Joaquin A.:
    Statement for the Record.....................................   219
Marshall, Hon. Roger:
    Opening Statement............................................     2
Mauga, Hon. Lemanu P.S.:
    Opening Statement............................................    49
    Written Testimony............................................    51
    Questions for the Record.....................................    96
    Letter for the Record........................................   230
Medicaid and Medicare Advantage Products Association of Puerto 
  Rico:
    Statement for the Record.....................................   232
Melendez-Altieri, Maria E. ``Mayita'':
    Letter for the Record........................................   237
Montanez, Rafael Hernandez:
    Letter for the Record........................................   241
Pierluisi, Hon. Pedro R.:
    Opening Statement............................................    54
    Written Testimony............................................    56
    Responses to Questions for the Record........................    98
Puerto Rico Solar & Energy Storage Association:
    Statement for the Record.....................................   248
Puerto Rico Statehood Action Network:
    Letter for the Record........................................   250
Riquelme-Cabrera, Keren:
    Letter for the Record........................................   126
Rodriguez, William J.:
    Letter for the Record........................................   252
Rossello Nevares, Ricardo:
    Statement for the Record.....................................   253
Torres, Hon. Ralph DLG.:
    Written Testimony............................................    64
    Questions for the Record.....................................   116










 
                   THE STATE OF THE U.S. TERRITORIES

                              ----------                              


                       TUESDAY, FEBRUARY 1, 2022

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 3:00 p.m. in Room 
SD-366, Dirksen Senate Office Building, Hon. Joe Manchin III, 
Chairman of the Committee, presiding.

          OPENING STATEMENT OF HON. JOE MANCHIN III, 
                U.S. SENATOR FROM WEST VIRGINIA

    The Chairman. The Committee will come to order.
    Good afternoon, everyone. So nice to have you. I want to 
thank you all for being here today, both in person and 
virtually, to discuss the current state of the U.S. 
territories. I would first like to extend a warm welcome to our 
territorial Governors. For those of you that have joined us in 
person, I want to thank you for traveling a great distance from 
your homes to be here. And for Governor Mauga, who is joining 
us online, I know it is quite early where you are in American 
Samoa, so thank you--thank you, sir, very much, for joining us 
this morning.
    And speaking of time zones from around the world, I would 
like to remind my colleagues that the sun never sets on the 
jurisdiction of the Senate Energy and Natural Resources 
Committee. We are 24/7. This Committee has a longstanding 
history of covering territorial policy, and I look forward to 
discussing the challenges and priorities for your respective 
territories and how the Committee can help advance your goals. 
The territories make valuable contributions to our nation, and 
I wanted to recognize that each territory is an integral part 
of the United States. We know our territories share similar 
issues, but I understand that each island is unique and each 
territory faces a different set of circumstances.
    My goal for this hearing is to discuss the broad issues as 
well as the ones you face individually so we can support each 
of you in trying to advance the well-being of those living and 
working in your respective islands. COVID-19 has had a profound 
impact on our lives and has certainly brought challenges to 
ensuring the health and safety of our communities. The pandemic 
challenges were compounded in the territories given the ongoing 
recovery from the devastating natural disasters that have 
impacted the islands.
    In June 2020, while still early in the pandemic, the 
Committee held a hearing focused on the impact of COVID-19 and 
the response in the territories. I applaud each government for 
quickly and effectively responding to the pandemic and for a 
successful vaccine rollout. I know that the decisions that you 
have made are difficult when considering how they impact your 
tourism-reliant economies. In response to the pandemic, 
Congress passed a number of funding bills to provide relief 
from the impacts of COVID-19. In passing these pieces of 
legislation, we made sure that funding provisions would work 
for territories, especially for programs where implementation 
differs from the states. Along with the economic challenges, 
the pandemic also exposed the disparities in our healthcare 
system, which include limited and unequal healthcare access, 
aging facilities, and shortages of medical providers. As a 
former Governor myself of a rural state in West Virginia, I 
certainly understand these challenges. I also know that there 
are questions about Medicaid. As you know well, Medicaid 
funding in the territories is capped and the federal match is 
fixed at a lower rate than most of our states and DC. While 
Congress temporarily increased Medicaid funding to the 
territories amid the pandemic, the additional funding has 
expired. We need to figure out a long-term solution to ensure 
that everyone continues to have success and access to essential 
health services.
    Of course, the pandemic and healthcare are not the only 
areas of concern. There are many, many pressing issues that we 
are going to discuss today, from workforce issues and disaster 
recovery to the different treatment of taxes and federal 
assistance of our programs. I look forward to learning more 
from the Governors about these issues facing each of these 
island communities. Now, I am hopeful that we can work together 
to create and respond to the challenges that are facing the 
territories and find common-sense solutions that will continue 
to lay the foundation for strong, sustainable economic growth 
for many years to come.
    Again, I would like to thank each of you for your time 
today. As a former governor myself, I know the many demands 
that you have on your time. I look forward to a productive 
conversation regarding your priorities and how Congress can 
help facilitate the success of your endeavors.
    I will now turn to Senator Marshall, who is standing in for 
Ranking Member Barrasso, for his opening remarks.

           OPENING STATEMENT OF HON. ROGER MARSHALL, 
                    U.S. SENATOR FROM KANSAS

    Senator Marshall. Well, thank you, Mr. Chairman. I also 
would like to welcome the Governors of the U.S. territories to 
the Committee today. I would like to make some brief remarks on 
the importance of our Pacific territories and the role my home 
State of Kansas has played in deterring threats to our Pacific 
territories in the Indo-Pacific region.
    In 2017, Kansas Air National Guardsmen from the 190th Air 
Refueling Wing in Shawnee County deployed to Guam to patrol the 
skies and help deter the threats of North Korea's missile test 
at the time. The Kansas Air National Guard Wing Commander 
stated about North Korea's test at that time, ``With every one, 
North Korea gets a bit more successful, gains more knowledge, 
and improves and builds on that.'' So the pace at which those 
tests are accelerating and advancing is what has raised a lot 
of concern. Just yesterday, it was reported that North Korea 
has tested a new missile that can now reach Guam. U.S. Navy 
Admiral Philip Davidson, then Commander of the U.S. Indo-
Pacific Command, testified before the U.S. Senate Armed 
Services Committee in March of last year stating, ``America's 
day begins in Guam, and it is not only a location we must fight 
from, but one we must also fight for, given the threats we face 
in the near term and the foreseeable future.'' North Korea's 
renewed missile tests and similar missile threats from China to 
the people of Guam and our military personnel deployed there, 
whether they be deployed from Kansas or other parts of the 
United States, must be acknowledged. It is my hope that we can 
continue to do what we can in this Committee to raise the 
awareness of this important issue.
    With that, Mr. Chairman, I yield back.
    The Chairman. Thank you, Senator Marshall. I would like to 
turn to the Governors of the territories. Let me introduce you 
all first, then we will get started.
    We will begin with the Honorable Albert Bryan, who is the 
Governor of the U.S. Virgin Islands, and will be testifying in 
person today. Thank you for being here, Governor.
    He will be followed by the Honorable Lourdes Leon Guerrero, 
who is the Governor of Guam, and she is joining us in person 
also, and I appreciate it.
    Then, we will have the Honorable Lemanu P.S. Mauga, who is 
the Governor of American Samoa, and will be joining us 
virtually.
    The Honorable Pedro Pierluisi, who is the Governor of 
Puerto Rico, testifying in person.
    And finally, Mr. David DLG. Atalig, who is the Secretary of 
Finance for the Commonwealth of the Northern Mariana Islands, 
and is speaking on behalf of Governor Torres, who is unable to 
join us this afternoon.
    I want to thank all of you for making the effort to be here 
today. Governor Bryan, we are going to begin with your opening 
remarks.

             STATEMENT OF HON. ALBERT BRYAN, JR., 
                 GOVERNOR, U.S. VIRGIN ISLANDS

    Mr. Bryan. Good morning Chairman Manchin, Ranking Member 
Barrasso, and members of the Committee. On behalf of the people 
of the U.S. Virgin Islands, I thank you for the opportunity to 
appear today to discuss the state of our territory and its 
priorities for 2022. I am Albert Bryan, Jr., Governor of the 
United States Virgin Islands.
    Chairman Manchin, you have been a stalwart friend to the 
Virgin Islands since you were a governor yourself and initiated 
a unique West Virginia/Virgin Islands collaboration on Medicaid 
issues. We have tremendous confidence in your leadership of 
this Committee, and I would like to thank you personally for 
your leadership throughout COVID and on the leadership that you 
are doing now. I would also like to offer special thanks to 
Senator Murkowski, who has given us so much help and 
encouragement over the years. More broadly, I thank all of the 
Committee members for your support in our efforts to mitigate 
the effects of COVID-19, which struck and paralyzed our tourism 
economy just as it was emerging from the catastrophic 
hurricanes that struck in September 2017. With the help of 
Congress and this Committee, we have endured the worst of the 
pandemic, and our tourism sector--nearly one-third of our 
economy--is thriving again. Our revenues are up and our debt 
burden is down. We are laying the foundation for a stable, 
sustainable prosperity for the people of the Virgin Islands.
    But there is still work, much work, to be done. Even before 
the pandemic and the hurricanes, the Virgin Islands faced 
unique challenges not encountered on the mainland--some the 
result of factors beyond the control of the Federal Government, 
such as geographic distance, isolation, lack of natural 
resources, and a need to replicate infrastructure and services 
across three separate islands. But some challenges we face 
result from federal policies which are within the power of 
Congress to change. I will focus my comments today on the more 
pressing of these issues we face now. My written statement 
addresses several specific needs and policy issues in detail. 
In my short time before you today, I want to focus on the 
broader principle that the United States Virgin Islands is an 
integral part of the United States of America. Its people are 
American citizens, entitled to the same rights, privileges, and 
benefits as Americans who reside in Alaska, West Virginia, or 
Wyoming. As President Biden said last year, ``There can be no 
second-class citizens in the United States.'' I will ask that 
you be guided by this principle when you legislate for the 
Virgin Islands and all the other territories.
    For too long, the Americans living in the insular areas 
have been treated as foreign or other, as something less than 
American citizens of the soil. To cite a few examples, a 
disabled American who lives in a state entitled to receive 
SSI--if she moves to the Virgin Islands, she loses it. Medicaid 
funding for the territories has for decades systematically 
lagged behind funding for the poorest states, and under the tax 
laws, investments made by U.S. investors in the Virgin Islands 
are treated as investments in a foreign country. This means 
that tax rules designed to disincentivize American investments 
in foreign tax havens like the Cayman Islands apply equally to 
the investments made in the American territories. I ask this 
Committee today to change that. Even the Constitution permits 
the Federal Government to treat American citizens living on 
American land unequally, simply because that land is a 
territory. There is no question that Congress has the 
authority, and I would argue the moral obligation, to treat all 
Americans the same. Citizenship is not geographic.
    First, although our economy is recovering, we continue to 
cope with financial challenges. Significant amounts of 
appropriated disaster funds remain inaccessible to the 
territory because of unrealistic local match. By statute, 
Congress permits agencies to waive any requirement for matching 
funds provided to the territory. In practice, however, the 
authority is never used. I respectfully urge the Committee to 
amend the code to require agencies to exercise that authority.
    Second, federal tax policy has imposed significant 
constraints on our ability to attract private investment. The 
tax code treats U.S. investments in its own territories as 
foreign investments, making them subject to the so-called GILTI 
(global intangible low-taxed income) tax, which is designed to 
discourage American companies from stashing profits in foreign 
tax havens, like the Caymans. The U.S Virgin Islands is neither 
foreign nor is it a tax haven. It is a U.S. territory whose tax 
laws are promulgated by Congress.
    Third, the economic problems resulting from the hurricanes 
and COVID have now further been aggravated by the EPA's 
decision last May to shut down our refinery, costing us 800 
jobs and $663 million in reduced GDP. We all share the EPA's 
concern with safety, but it is not clear that the EPA 
understands the unique importance of the refinery to the 
economic, financial, and social well-being of the Virgin 
Islands community, specifically St. Croix. Environmental 
justice is a hollow victory without economic opportunity. I 
therefore ask for Congress's assistance in working with the 
territory and the EPA to ensure that the refinery is permitted 
to responsibly and safely reopen as soon as possible.
    Fourth, we are urgently seeking restoration of adequate 
funding for the territory's highway. That funding was cut to 
the bone in 2012 and has never been fully restored, with 
predictably deleterious effects on our roads. Yet another 
example of Americans receiving poor treatment simply because of 
where they live. Singling out the four small territories for 
funding cuts was unfair, and ignored their uniquely pressing 
transportation funding needs. I respectfully ask the Committee 
to support a restoration of our highway funds to the levels we 
received before 2012.
    My written statement describes additional issues of 
importance, including a permanent fix to Medicaid and the 
fiscal cliff that will occur in February, permanently restoring 
the cover-over rate for the rum excise taxes that are so 
important to our economy, and extending Supplemental Security 
Income (SSI) to residents of the Virgin Islands and other 
territories who are currently denied.
    In closing, I wish to say I am an American, just as you 
are. My constituents are Americans, just as your constituents 
are. They should receive the same consideration and the same 
treatment from Congress and the rest of the Federal Government 
that their fellow citizens on the mainland do. I urge you to 
move beyond the days when it was acceptable and even expected 
that the Americans I serve would be treated differently than 
the Americans you serve. There is so much that we can do 
together to improve the lives of the people of the Virgin 
Islands and the other territories to bring us up to the level 
of our fellow citizens on the mainland. All we ask is the 
gracious assistance that you have provided tremendously over 
the course of this global pandemic, that you continue to do the 
same, and remember us as friends in the Virgin Islands. Thank 
you for considering this testimony and for your support for our 
fellow Americans in the U.S. Virgin Islands.
    [The prepared statement of Governor Bryan follows:]

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    The Chairman. Thank you, Governor Bryan.
    Now we will have Governor Guerrero. I hope I am pronouncing 
that correctly.
    Ms. Guerrero. Yes, you are, sir.
    The Chairman. Thank you.

    STATEMENT OF HON. LOURDES LEON GUERRERO, GOVERNOR, GUAM

    Ms. Guerrero. Chairman Manchin, Ranking Member Marshall, 
and esteemed members of the Committee, a warm Hafa Adai from 
Guam, where America's day truly begins. I appreciate the 
opportunity to provide testimony on behalf of our island and 
her people on advancing issues and policies important to the 
territories. Mr. Chairman, as a former governor, you know full 
well the challenges we face, and I want to personally 
acknowledge your longstanding commitment to addressing many of 
the perennial issues we continue to confront, particularly 
during these uncertain times. COVID-19 has undoubtedly tested 
the human capacities and spirit of communities across the 
globe. But as Americans, as Chamorros, we are resourceful and 
we are resilient. With 94 percent of Guam's eligible population 
protected, we have prevented our healthcare system from 
collapsing, and at the end of the day, lives were saved. I am 
grateful to the Biden Administration and the Congress for their 
support in ensuring that states and territories have the 
resources to continue to combat this virus.
    Beyond resilient, we are equally resourceful. Traveling 
nurses assigned to Guam can vouch for the tenacity of our local 
healthcare heroes who, quite literally, keep the hospital roof 
from falling. But Band-Aid fixes are not a long-term solution 
for our facilities, which are in desperate need of critical 
care. In 2019, the Army Corps of Engineers assessed and 
recommended that our public hospital be replaced to ensure 
safety and accreditation. Last year, the House passed the Build 
Back Better Act, which included $347 million to construct a new 
hospital, as recommended by the Army Corps.
    Although we are engaged in pandemic response, we remain 
focused on recovery. Along with economic diversification, we 
cannot abandon our number one industry. Before COVID-19, one 
out of three jobs was tourism-related. Now, arrivals have 
decreased by 92 percent and thousands have lost work. With a 
full recovery not expected within the next three years, I ask 
this Committee to consider passing an additional relief package 
specifically for territories to address previous federal aid 
disparities and our prolonged hardship due to reliance on 
international tourism. To achieve full recovery, we will need 
help. Guam's H-2B worker population went from zero in May 2018 
to over 2,000 workers last month due to the military buildup. 
However, the H-2B Visa exemption only helps the construction 
sector, mainly for the construction of a new Marine Corps base, 
and will expire in 2023. As we diversify our economy, we will 
need more workers for both civilian construction and non-
construction industries. As we develop the skill sets for these 
new ventures, I ask you to extend the exemption to 2029 and 
establish a Guam-only temporary-need criteria within the H-2B 
program that would recognize ``other qualified need'' as 
determined by the Governor of Guam. There is Congressional 
precedent for such a program to be developed, and I hope that 
we can explore this further, as such a program will need 
Congressional action.
    Long before our struggles with the pandemic, territories 
were facing another healthcare crisis, mainly inequity with 
Medicaid. Temporary efforts have provided more funding to Guam 
and increased our matching rate. However, we will soon revert 
to annual caps and expiration dates for federal Medicaid 
funding and be required to match at a high 55/45 ratio. 
Therefore, I ask you to remove our Medicaid funding cap and 
expiration dates and base our matching rate on per-capita 
income, like the states in the United States. On the Compacts 
of Free Association (COFA) treaties, I ask to participate in 
treaty renegotiations to include the following amendments: full 
reimbursement for future expenses borne by Guam attributed to 
Compact migration, debt swap of past unreimbursed expenses, 
screening originating in the Freely Associated States (FAS) 
prior to arrival to Guam, extension of Medicaid coverage to FAS 
citizens in their home nations, and expansion of low-income 
housing tax credits. On self-determination for the people of 
Guam, I ask you to pass a bill to advance a process to allow us 
to articulate our desired political status. I ask you for your 
favorable consideration to allow Guam as eligible benefactors 
of Senate bill 2798. Lastly, I ask you to amend the bipartisan 
infrastructure law to include Guam in the State Digital Equity 
Capacity Grant program and to pass Build Back Better, which 
would be significant to Guam by expanding Medicaid and the 
Child Tax Credit, extend SSI to Guam, provide more support in 
education, housing, child care, and infrastructure needs, 
especially for a new public hospital, and position Guam's 
economy for stronger growth, which will advance our nation's 
competitive global position.
    We look to your leadership and assistance in addressing 
these issues for Guam. On behalf of a grateful island, Si Yu'os 
Ma'ase, and thank you for all of your efforts to protect not 
just our nation, but the islands and the territories in our 
Pacific. Thank you.
    [The prepared statement of Ms. Guerrero follows:]

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    The Chairman. Thank you, Governor.
    Now we have Governor Mauga from Samoa.

             STATEMENT OF HON. LEMANU P.S. MAUGA, 
                    GOVERNOR, AMERICAN SAMOA

    Mr. Mauga. Talofa and greetings from American Samoa. I want 
to thank you, Honorable Chairman Manchin, Ranking Member 
Marshall, and distinguished members of the Committee, for this 
opportunity to share with you some of the challenges facing our 
territory and thank you for your ongoing efforts to improve our 
nation. First of all, I would like to thank Chairman Manchin 
for all the hard work in committee that he has put into this 
effort. Thank you for your role in passing the ARPA (American 
Rescue Plan Act) and the bipartisan infrastructure bill 
investment. This funding has allowed us to realize what we have 
hoped and dreamed of. In a year, we have repatriated thousands 
of citizens in the face of COVID-19 and are able to work around 
travel restrictions limiting flights to and from the U.S. to 
two in a month to American Samoa.
    Our vaccination effort has reached more than 80 percent of 
our population and counting, and we continue to push through 
with our quarantine operations with the oncoming flights. It 
has been a rollercoaster for American Samoa, and God has been 
good to us amongst the highs and lows of 2021. This pandemic 
has turned our world inside out. Thus, trying to get back to 
normalcy is a challenge. From health, welfare, security, 
education, food safety and security, infrastructure, life, our 
freedom, and faith are all being tested by COVID-19. We are 
fighting on the front line for life and death because of the 
pandemic. Leaders cannot suspend other long-time challenges of 
our nation, i.e., global warming, infrastructures, education, 
and so forth.
    Again, thank you for ARPA and thank you for the bipartisan 
infrastructure bill. It supports our states and territories in 
the U.S. With all of these, American Samoa faces challenges in 
expediting these emergency funds. We are seeking relief of our 
matching local funds. We ask for more flexible usage of 
categories of federal funding to be reallocated locally. And 
due to isolation--shipping transportation for goods, fuel, and 
building materials is not consistent and currently very slow, 
and especially for the high cost of supplies recently--we are 
requesting an extension for the end date or life of these 
funds. We are now planning for a new hospital facility that was 
investigated by the Army Corps of Engineers, a mandate by 
Congress. That is going to cost $700 million, but now we are 
investing into that effort with the funds from the COVID with 
the $300 million. We are still asking for more funding to 
fulfill this requirement.
    Terminal buildings at the airport, bridges, access, ease of 
operation, and security for travelers--the airport is one of 
our projects, and we are expanding the services for incoming 
flights to American Samoa. Sea transportation services to outer 
islands prove difficult due to limited vessels and shipyard 
maintenance services. It is another big project that we are 
trying to maintain and facilitate. With the help of 
Congresswoman Uifa'atali Amata Radewagen and the U.S. Army 
Corps, we are on our way to securing two landing crafts to 
service our neighboring island and our shipyard services to 
improve its maintenance schedule. Funding for our schools has 
relieved pressures in old and worn-out buildings, needed 
maintenance and preparation for distance learning in case of 
emergency and community spread in COVID cases.
    We have been able to use funding to source and improve on 
technology in our network, not only in education, but in our 
government. Being isolated in the South Pacific, access to 
broadband is a critical link to the outside world, and our 
security, along with our aging clean water infrastructure and 
long-overdue road restoration, has given us gratitude for the 
bipartisan infrastructure bill. This has been a welcome relief 
to our territory, and it has relieved ongoing pressure and 
anxiety in dealing with our aging infrastructure. Given the 
current plans and projects funded by this legislation, the 
threat of climate change and rising sea level continues to loom 
over our islands in real time. As a result, we plan to create 
barriers through sea walls and other mitigation efforts to 
resolve this horrifying threat. We are also preparing ourselves 
for migration to higher ground from the sea level rising and 
toward the hills and mountains as the threat of tsunami-
producing volcanoes and earthquakes remains a constant threat 
and increasing hazard, causing anxiety to our people. This is 
our cry to Congress in the government of American Samoa, and we 
ask for your flexibility in how we use the funding that was 
given for emergency uses.
    Thank you very much for all of the support, and thank you 
very much for helping American Samoa along the infrastructure 
rebuild, and thank you very much for America. Fa'afetai.
    [The prepared statement of Mr. Mauga follows:]

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    The Chairman. Thank you, Governor.
    And now we will have Governor Pierluisi from Puerto Rico.

             STATEMENT OF HON. PEDRO R. PIERLUISI, 
                     GOVERNOR, PUERTO RICO

    Mr. Pierluisi. Chairman Manchin, Ranking Member Marshall, 
and members of the Committee, thank you for holding today's 
hearing regarding the state of the U.S. Territory of Puerto 
Rico. I am pleased to report that Puerto Rico is emerging from 
a challenging period with strength and optimism. Our 
government's debt restructuring has been approved. The 
rebuilding from the devastation caused by the hurricanes and 
the earthquakes is underway, and our COVID vaccination rates 
are amongst the highest in the country.
    But much work remains to be done. We have strategically 
allocated federal funds related to the pandemic to mitigate its 
effects on our public health and our economy. This has helped 
provide a sustained rise in economic activity indexes. We are 
seeing a considerable drop in unemployment, increasing job 
creation, and positive economic growth that had not been seen 
in years. As Puerto Rico's economy recovers and we continue to 
promote its growth, we must work with Congress to receive fair 
treatment in domestic social programs such as Medicaid and 
Medicare, and join forces to do work necessary to ensure Puerto 
Rico's prosperity.
    Puerto Rico has recently reached the most important 
milestone of the debt restructuring process with a now-
confirmed plan of adjustment. This paves the way for Puerto 
Rico to exit its bankruptcy process with a stable and 
sustainable balance sheet and prudent management of our public 
finances in the future, while the plan of adjustment and Puerto 
Rico's revised fiscal plan, our foundational milestones, and 
the Oversight Board have had positive impacts on our financial 
management structures. The Board has become another layer of 
bureaucracy that frequently delays and sometimes even impedes 
government execution, and that imposes public policies that do 
not reflect the will of the people. Also, lack of clarity as to 
when the Oversight Board should end its work on the island is 
something that needs to be addressed. My administration is 
committed to working with you to protect the democratic rights 
of the people of Puerto Rico to be governed by those they 
elect. On the other hand, Puerto Rico, this Committee, 
Congress, and the Biden Administration have committed 
significant resources to Puerto Rico's own Build Back Better 
program after the ravages of the hurricanes and the 
earthquakes. I am pleased to report significant advances in 
these efforts during my administration.
    2022 will be a key year in our reconstruction with 
thousands of rebuilding projects for schools, housing, roads 
and bridges, water and sewer facilities, and the electric grid. 
Just as our nation is wrestling with the transition to a new 
energy future, so is Puerto Rico. Saddled with an antiquated 
electrical infrastructure that was devastated by the storms, 
Puerto Rico is moving away from fossil fuels, energy 
regeneration, and toward renewables. While we are working to 
rebuild the island's economy and its infrastructure, there 
remain certain long-term, fundamental inequities that we need 
to address. Several of these inequities are in social programs, 
and Medicaid is a good example of how these inequities uniquely 
affect Puerto Rico. All American citizens who are eligible to 
receive Medicaid coverage get it, except for those who reside 
in Puerto Rico and the other U.S. territories. Puerto Rico, for 
example, must contend with a Medicaid program based on capped 
federal funding and additional short-term funding that lurches 
from cliff to cliff. Unless this issue is at rest before June 
30th of this year, Puerto Rico will be forced to make very 
difficult choices among competing needs that will impact the 
accessibility and quality of its healthcare system. I ask this 
Committee to ensure that the Medicaid program basically be 
applied to Puerto Rico as it is in the states.
    Puerto Rico has been a U.S. territory for over 124 years, 
and it is important to realize that even after the successful 
restructuring of our public finances and the rebuilding of our 
infrastructure, Puerto Rico will remain hindered until our 
century-long status question is resolved. Our nation is engaged 
in a serious debate about voting rights, with both Democrats 
and Republicans underscoring that the right to vote is the 
cornerstone of our democracy. The people of Puerto Rico voted, 
and chose permanent union with the United States through 
statehood as their path forward. So many Puerto Ricans have 
defended American democratic values at home and abroad that 
lack of representation and voting rights, as well as 
Congressional inaction, are not acceptable. Congress must call 
for a vote on Puerto Rico's political future and commit to 
implementing the will of the majority. That is what democracy 
is all about. It is time to act.
    Thank you.
    [The prepared statement of Mr. Pierluisi follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    
    The Chairman. Governor, thank you so much. Thank you so 
much.
    And now we are going to have Mr. Atalig. Thank you, sir, 
Secretary.

     STATEMENT OF HON. RALPH DLG. TORRES, GOVERNOR OF THE 
  COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS (DELIVERED BY 
 DAVID DLG. ATALIG, SECRETARY OF FINANCE, COMMONWEALTH OF THE 
                   NORTHERN MARIANA ISLANDS)

    Mr. Atalig. Thank you, Chairman Manchin, for allowing me to 
speak and put in the record the oral testimony of our Honorable 
Governor Ralph Torres:
    Hafa Adai and Tirow from the Commonwealth of the Northern 
Mariana Islands. Thank you, Chairman Manchin, Ranking Member 
Marshall, and members of this Committee for holding this 
important hearing to hear about the state of the U.S. 
territories. Please accept my apologies for not being able to 
join this hearing in person. When I last appeared before this 
Committee in 2019, the world was a dramatically different 
place. The pandemic has altered the way in which the Senate 
conducts its important business, how millions of people around 
our nation manage their lives, and has dramatically altered the 
state of the U.S. Territory of the Commonwealth of the Northern 
Mariana Islands (CNMI). In the CNMI, we firmly believe that we 
are ``Marianas Strong.'' Being Marianas Strong is the 
recognition that we have within us the resilience to overcome 
tremendous challenges, uniting even when we disagree, and 
rebuilding and recovering as one community.
    While the nation works toward adjusting to the impacts of 
the COVID-19 pandemic, we have experienced a decade and more of 
singular events reshaping our lives over and over again. 
Typhoon Soudelor in 2015 and Super Typhoon Yutu in 2018 
devastated the islands, destroyed many homes, closed commercial 
activity, and reset our understanding of our vulnerabilities 
against a changing climate. The nature of this present crisis 
is different for the CNMI in many ways. The secondary impacts 
of the crisis and our mitigation response levied a 
disproportionate burden on our small tourism-focused economy. 
Since the collapse of the CNMI's manufacturing sector, the 
economy is solely reliant on international travel and tourism. 
This pandemic halted the sole economic driver in its tracks, 
and once more left the CNMI peering over the edge of another 
economic depression. We were not alone this time, however, and 
our challenges were shared by communities throughout the 
nation. We were incorporated into the national discussion, and 
most importantly, aided in the national response. I am grateful 
for the assistance we have received in the American Rescue Plan 
Act, and I thank the members of this Committee for your support 
of the needs of the territories.
    The Infrastructure Investments and Jobs Act will allow the 
CNMI to invest in critical infrastructure and address resource 
needs to ensure that our communities can grow while we are 
standing current on future weather and climate-related 
challenges with minimal physical damage or disruption to our 
communities. As the CNMI looks at the possibilities made 
available through Federal Government assistance, I must 
reinforce a message that I have brought to this Committee many 
times before. The issues of the CNMI labor force are well known 
by this Committee, and I ask once more and thank you for your 
willingness to assist in fostering a strong U.S. workforce in 
the CNMI. I am proud to say that the CNMI has taken the 
mandates of the Northern Mariana Islands U.S. Workforce Act 
seriously, and have made considerable progress for the U.S. 
workers and our economy. Should the timely deployment of 
federal resources to support the economic needs of the 
Commonwealth be of importance to Congress, a new understanding 
of these challenges and a new look into the accessibility of 
the 
CW-1 to support these goals in the CNMI is warranted. The 
Infrastructure Investment and Jobs Act and ARPA provided the 
opportunities to address many of the longstanding concerns of 
the CNMI that are specific to our ability to better manage our 
economic development and make a real investment in the 
infrastructure of the CNMI and the lives of its people.
    As the nation works to build resilient infrastructure with 
a once-in-a-generation investment through Build Back Better, 
there are opportunities to acknowledge and address the unique 
capacity and infrastructure challenges of the U.S. territories 
in order to work toward national efforts to provide immediate 
and long-lasting relief to the communities and businesses. I 
request your partnership in seeking a permanent allotment of 
3,000 CW-1 permits to support construction activities that are 
inclusive of those unrelated to presidentially declared 
disasters, during the transition period, as a means to deploy 
funding to support critical infrastructure projects and provide 
for an additional means to support employment across various 
sectors of our economy. We are working to respond to the many 
needs of the CNMI infrastructure, but we see a tremendous 
opportunity to advance the real progression toward equal 
standards of living with the larger United States through the 
Build Back Better initiative. I have spoken in support of the 
Biden Administration's Build Back Better proposal, and we 
greatly appreciate the work of the White House in listening to 
the needs of our islands. I ask for your consideration in 
support of Build Back Better and request further consideration 
of the challenges experienced by the territories and the many 
ways continued investment in the long-term potential of our 
islands expands the power of this great country around the 
world.
    Despite its supreme challenges, I do not wish for these 
islands I love to be defined by these limitations. The 
hardworking people of the CNMI who are used to struggle and 
hardship are also deserving of a modern infrastructure that 
supports economic development, a better quality of life, safety 
and health, and consideration for health of the environment. I 
would like to thank you for the opportunity to provide this 
written testimony on the Infrastructure Investment and Jobs 
Act. I am hopeful for the progress that will be made with the 
federal assistance for the betterment of our nation and the 
people of the Commonwealth of the Northern Mariana Islands. Si 
Yu'os Ma'ase. Thank you.
    [The prepared statement of Mr. Ralph DLG. Torres, Governor 
of the Commonwealth of the Northern Mariana Islands, follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    The Chairman. I thank all of you.
    Now we are going to start our questioning from the 
Senators, and I will begin. I am going to ask a couple of 
general questions to all of you to think about this: How is 
inflation harming you or helping you or not affecting you, 
whatever? Is inflation a problem? How about COVID? Do you see a 
downturn there? Is it still rising? And have we done enough in 
the U.S. to support you with all of the tools that you need to 
try to keep all of your people as healthy as possible and your 
vaccination rates?
    The final question I will ask is, with the COVID response 
that we have, COVID assistance over $5.4 trillion and another 
$1.2 trillion coming in in the infrastructure, what was the 
greatest help you had that you thought was a benefit for your 
island, for your people, and what more can we do to help?
    We will start, Governor Bryan, with you and inflation, 
COVID, and then also the assistance of the COVID relief.
    Mr. Bryan. Thank you, Senator. I will start on a positive 
note. The COVID relief was a blessing. The CARES Act--the 
initial $75 million we had--was very flexible. We used it to do 
a number of things, including manage the incredible amount of 
marine traffic we had come to the Virgin Islands after everyone 
else in the Caribbean closed their ports.
    Inflation, just to put it in perspective for you--a bucket 
of chicken in the Virgin Islands is $50. That's fast food--
Kentucky Fried Chicken. That was before COVID. Now we are 
seeing construction--everything going through the roof.
    The Chairman. How much is a bucket of chicken now?
    Mr. Bryan. It is probably $60.
    A 1,200 square-foot home--affordable home in the Virgin 
Islands--1,200 square feet is $450,000. We are still recovering 
from two hurricanes. Ninety percent of everything--probably 95 
percent of everything we have is shipped in. So we are under 
tremendous duress. The flexibility of funds is the most 
important thing to us as we move through COVID. We have storm-
damaged hospitals. One in St. Croix that still--we have not 
even been able to open a temporary hospital yet. So COVID was a 
particular challenge, but we have been doing well in the 
Caribbean because of those dollars, testing----
    The Chairman. What is the percentage of your citizens to be 
inoculated?
    Mr. Bryan. Fifty-two percent by the CDC, but by the new 
census, 65 percent of our people are vaccinated and 85 percent 
of people over 65 are vaccinated.
    The Chairman. I am going to have to ask you all, if you 
can, to expedite that because we only have so much time.
    So, Governor, if you can? Yes.
    Ms. Guerrero. Thank you very much, Senator.
    Our COVID vaccination rate for eligible population, this is 
five years and older, is 95 percent. Our total population 
vaccination rate is 85 percent. During our COVID relief, the 
biggest help, really, is the testing, the vaccinations, the 
monoclonal treatments, and also bringing in some healthcare 
resources--personnel that have come through FEMA, the military, 
and also, we used our National Guard, and the ability to use 
the National Guard with the extensions of Title 32.
    Inflation, as the previous Governor, Governor Bryan, 
stated, we are also impacted with high cost of prices as a 
result because of the shipping costs and also because of cost 
in gas, fuel, and so forth. So, we----
    The Chairman. Mostly supply chain?
    Ms. Guerrero. Yes. Right now, our grocery stores are half 
empty because of the ships not coming in as a result of what is 
happening out in California with the containers being still out 
and not being able to be offloaded and sent off to the 
various----
    The Chairman. What was the greatest help you received from 
the COVID package--all the COVID packages we tried to help with 
last year? Which one helped you the most?
    Ms. Guerrero. The ARP----
    The Chairman. ARP?
    Ms. Guerrero [continuing]. Was one of the best ones, yes.
    The Chairman. Okay.
    Governor Mauga, how about yourself?
    Mr. Mauga. Mr. Chairman, the honorable members of the 
Committee, American Samoa feels the same problems or issues 
with the neighboring territories. Inflation is one of the 
issues we want to address. The cost of living has gone up since 
COVID-19. For instance, a cement bag that cost about $8 is now 
more than $20 for a cement bag, and the cost of building 
materials went up as well. Ship transportation in the oceans 
and sea are very slow to American Samoa, so a lot of our 
projects and what we do here in American Samoa has to wait for 
shipping to come in. Food security is another issue that we are 
going to be facing in the near future because sea 
transportation is slow and not forthcoming as usual. Usually we 
get two ships a week, and now, we are getting about two ships a 
month.
    The Chairman. How about COVID? How is COVID affecting you, 
sir, if I may ask? Percentage-wise?
    Mr. Mauga. Okay, yes, COVID, we thank you for the 
vaccination part of American Samoa. We have 82 percent 
vaccinated, and we are still working on getting up to 90-plus 
percent.
    The Chairman. Great.
    What was the greatest help you got from the COVID package?
    Mr. Mauga. We have restarted the infrastructure buildup 
since COVID in terms of building infrastructure to cope, just 
in case COVID spread to American Samoa. We rebuilt the schools. 
We have rebuilt some of the health facilities as well as our 
LBJ (LBJ Tropical Medicine Center).
    The Chairman. Okay, thank you.
    Mr. Mauga. Yes, Okay.
    The Chairman. Thank you, sir, so much.
    And now we have Governor Pierluisi.
    Mr. Pierluisi. In terms of inflation, we are particularly 
concerned about the costs of construction. The Associated 
General Contractors, Puerto Rico Chapter, reports that the 
increase is about 25 percent, which is really unprecedented. 
And I am concerned about it because we are in the midst of an 
unprecedented reconstruction effort using FEMA funding and 
CDBG-DR and CDBG-MIT funding. So that is one that----
    The Chairman. Do you have a labor problem also?
    Mr. Pierluisi. We do and----
    The Chairman. Do all of you have a labor problem?
    Ms. Guerrero. Yes.
    Mr. Pierluisi. Yes--labor shortage. We lost some 
population. We are trying to attract some of that population, 
including in construction.
    The Chairman. I got you.
    Mr. Pierluisi. In terms of COVID, I have to say that we 
have done very well. I mean, our vaccination rates are on the 
top, and by the way, look what happens when you treat us 
equally. When you treat Puerto Rico equally, in terms of the 
number of vaccines, medicines, test kits, and so on, we did 
better than most states.
    The Chairman. Great point.
    Mr. Pierluisi. And now, one thing you asked about is the 
CARES program--CARES and the American Rescue Plan. I have to 
say that giving flexibility is very good. We were able to 
incentivize the economy. We not only gave premium pay 
incentives to essential workers in our economy, we also 
incentivized workers to come back to their places of employment 
in the middle of the pandemic, and we incentivized our tourism 
industry, which is key for our future. So that flexibility I 
have to praise.
    The Chairman. Okay.
    And Mr. Atalig, very quickly, if you can, give us a little 
breakdown very quickly because I have taken much more time than 
I should have.
    Mr. Atalig. Yes, thank you.
    As far as inflation, we, among the territories, have the 
same experience--shipping costs, the costs of goods coming here 
from the mainland.
    The Chairman. Labor?
    Mr. Atalig. Labor.
    Our COVID numbers were--we have a little spike right now--
but we are doing really good. Our vaccination rate is 99.3 
percent as a population.
    The Chairman. Oh, my goodness. You win the ribbon today.
    [Laughter.]
    Mr. Atalig. We have tools. You mentioned the tools from the 
different packages. FEMA has been great, a great partner since 
the devastation, the disasters we have had. We have continued 
that partnership. And as far as what is the most beneficial 
package? Obviously, it is the ARPA and the sections where 
funding was available for territory government with provisions 
of government and monies to give and help households. We gave 
our own local stimulus as well as assisted our people with 
their utilities.
    The Chairman. Thank you.
    I am going to go vote. Senator Heinrich is going to take 
over for me and then we are going to go to Senator Lankford 
right now for his questioning.
    Senator Lankford. Right now?
    The Chairman. Right now. Senator Marshall left you.
    Senator Lankford. Thank you.
    All of you, thanks for being here as well. I appreciate the 
engagement. This is helpful for us to be able to get context. 
Obviously, most of us do not get out to where you are very 
often. We are scattered across every time zone. So I am 
grateful to be able to have the dialogue and to be able to go 
through the key issues. I appreciate the insight.
    My questions, actually, are dealing with an issue--dealing 
with the Northern Mariana Islands, specifically. I know we are 
actually, currently, multiple time zones away to be able to go 
through this conversation as well. But I wanted to be able to 
ask about some of the immigration policies there and the 
influence of China, specifically in what is happening on the 
islands. What are you seeing as far as traffic, individuals, 
tourism, and such coming into the islands at this point from 
China?
    Mr. Atalig. Thank you, Senator Lankford.
    Obviously, with the pandemic and the effects on 
international travel, we have had zero travel and tourism from 
China. We do have a travel bubble with South Korea, but as far 
as China is concerned in the last couple years, it is a non-
factor.
    Senator Lankford. So go back to 2019 and before, because we 
saw a pretty rapid rise of Chinese nationals in construction. I 
know there were several different challenges with labor laws 
being violated with the 45-day, basically, visa process to be 
able to come from China--that we saw some Chinese companies 
coming and doing construction, bringing in Chinese nationals, 
not paying them basic wages there and then moving back and 
forth. What do you anticipate happens once we get to the other 
side of COVID--even, so Lord come, when that day comes--what do 
you anticipate happens? Do we return right back to that again?
    Mr. Atalig. No. Thank you for that question. This pandemic 
gave us an opportunity to revisit a lot of the policies we have 
as a Commonwealth, and one of the issues is in our tourism 
sector, obviously. You know, we had issues with, you know, 
unregistered Airbnbs and attracting foreigners coming in, and 
working very closely with the Governor's Council of Economic 
Advisors that are looking at different policies and issues to 
correct things, it gives us an opportunity to reset and make 
some policy decisions to better and improve on some of those 
issues.
    Senator Lankford. Terrific. I want to get a chance to be 
able to follow through on that some. In 2009, when the new visa 
process came into place on that, with Chinese nationals able to 
come in faster and easier into the process--my understanding 
from the records that we could find, and we have not found all 
the records on this, but my understanding from the records is 
that individuals that were foreign-born coming into the islands 
and having a child--there were 10 in 2009, but by 2018 there 
were 600--that there seemed to be an influx of individuals 
coming from China to the Northern Mariana Islands, having a 
child there, and obviously, that is significant for us in the 
United States if a Chinese national is actually coming in to be 
able to have a child there. Have you seen that trend? Where is 
that trend in 2019? That is the year we do not have. Did that 
continue? Once we reopen again post-COVID, what happens with 
that type of tourism?
    Mr. Atalig. That is an excellent question. I think what we 
have done locally is address that. Our Commonwealth health 
center has spiked the cost for foreigners to get services in 
our hospitals for delivery and things of that nature. It has 
reduced the number. You have to also keep in mind that we do 
not control our borders in terms of immigration.
    Senator Lankford. Right.
    Mr. Atalig. And so, when these people come in and go 
through, you know, customs and border patrol, we are stuck with 
the challenges that were allowed to be brought in.
    Senator Lankford. What do you need from us to be able to 
help you? Obviously, raising the price in the hospitals and 
everything else for delivery costs, there are a lot of folks 
who would be willing to pay a lot of money to be able to have 
American citizenship--I get that--and have access to the rest 
of the country. What do you need from us to be able to help you 
in these challenges?
    Mr. Atalig. I think we need some policy changes and a 
little bit more flexibility in our control of the borders, as 
we have had that control in the past. We did not have that 
issue prior to that, but I think, Senator Lankford, this is a 
question that I will bring back to our leaders and be 
responsible to give a great response.
    Senator Lankford. Okay, well, I would very much appreciate 
that. Obviously, we do not want to hurt tourism. That is a 
major feature of the economy, and we understand that and want 
that to be able to recover again. But we want to be able to 
protect the integrity of the workforce, what is actually 
happening there, and also the multitude of issues with birth 
tourism that can dramatically affect what is happening in the 
entire country with that.
    So I will look forward to getting a chance to get your 
input and ideas back. Thank you.
    Mr. Atalig. Thank you.
    Senator Heinrich [presiding]. Senator Cortez Masto.
    Senator Cortez Masto. Thank you. Thank you, again, 
Governors and Secretary for being here as well. I appreciate 
your comments today.
    Governor Bryan, let me start with you. After Hurricanes 
Irma and Maria, it was clear that the islands were struggling 
to rebuild, as well as how critically important federal 
disaster funding was to that rebuilding. Can you describe how 
rebuilding and recovery have progressed, particularly given the 
challenges that you face because of the COVID-19 pandemic?
    Mr. Bryan. Thank you for that, Senator.
    We have definitely struggled for the first--I have been in 
office for three years now, and the first two years was a lot 
of cleaning up and getting to a right place with FEMA. With the 
advent of Deanne Criswell as the administrator, she has been 
tremendous in helping us resolve a lot of those matters. Still, 
we have a lot of matters pending. Key places like our roads and 
especially our hospitals are not done yet. Our schools are not 
rebuilt. As you can imagine, having COVID-19 and shutting down 
all of these government offices with one hospital on each 
island, we had to continuously delay this from happening. But 
we have been very strategic, and I am happy to report that our 
fiscal situation has vastly improved--our insolvency and our 
retirement system--yesterday we had a positive vote from our 
legislature. We are going to resolve that. We paid off a lot of 
our debts, and thanks to this body for giving over $300 million 
in community disaster loans. So we are coming along nicely. We 
still have some challenges with HUD and getting those funds out 
quickly so we can start rebuilding homes. But other than that, 
we are doing well.
    Senator Cortez Masto. Thank you.
    And Governor Pierluisi, same question to you. Rebuilding 
after the hurricanes, what progress have you made? And talk 
about, if you would, your energy independence that you are 
looking at doing as well, or at least the clean energy that you 
are looking at incorporating in Puerto Rico.
    Mr. Pierluisi. The reconstruction is well underway. For 
about three years after the hurricanes hit us--and this was 
back in 2017--for about three years, a bit more, we were 
basically getting emergency assistance. Repairing, but not 
really dealing with permanent projects. Last year--I took 
office in January--we started doing permanent projects, and now 
the estimate is that we will be having 2,000 construction 
projects ongoing this very year, and with this, you are talking 
about the whole wide range of infrastructure projects.
    Now, the economy did very well last year, amazingly so. We 
grew. We had not grown, for, you know, some time. So it was a 
three-percent growth that New York--the Federal Reserve--the 
New York Chapter said that our economy performed best in their 
region, particularly in unemployment and employment numbers. We 
have always been lagging in terms of labor participation. There 
has been a very significant increase in labor participation 
lately, and our unemployment is at a level that we had not seen 
for more than ten years.
    So we are on our way back. Having said that, you mentioned 
energy. We are in the midst of this energy transformation, and 
let me tell you, it is challenging. We have a very aggressive 
and proactive renewable energy portfolio set in law, and I am 
committed to doing that--turning to renewables. But in the 
process, at any time, roughly 40 percent of our energy 
production comes from oil-burning plants. And it is very likely 
that we will not be able to comply with EPA air emission 
standards in the coming years. I need to turn to LNG in a 
hurry. So I need help from the Federal Government so that we 
use LNG as a transition energy while we turn to renewables, 
which is our goal. It is our standard.
    So that is a challenging area. The system is stable as we 
speak. We privatized the transmission and distribution of 
energy in Puerto Rico. There were some growing pains, but now 
it is clearly stable, and on the generation side, we are about 
to privatize as well the operation and maintenance of our 
legacy assets--our generation plants. And we will, because we 
could not keep doing more of the same. The energy system in 
Puerto Rico was a publicly owned monopoly that really 
underperformed, and it was really embarrassing the way it acted 
after the hurricanes. We do not want to go back there. So I am 
committed to doing this transformation, but again, I admit, 
that it is challenging.
    Senator Cortez Masto. Thank you.
    I know my time is almost up. I am going to submit the rest 
of my questions for the record, and I am interested, Governor, 
in your comments about PROMESA and winding down the Board and 
what that looks like. I will submit those for the record, 
however.
    Thank you.
    Mr. Pierluisi. Thank you.
    Senator Heinrich. Senator Marshall is going to let Senator 
Murkowski go next.
    Senator Murkowski. Thank you, Senator, and thank you for 
having this hearing. I think it is an oftentimes 
underappreciated part of this Committee's jurisdiction, is the 
oversight that we have of our territories and the fact that we 
only get an update every seemingly couple of years is really 
not often enough. I was interested in listening to the 
responses to Senator Manchin's question about the impacts from 
inflation, COVID, workforce, and I am just reminded that what 
happens in the United States is what is happening out on your 
islands. But it is just magnified ten, twenty, thirty, forty 
times over, because when you are a group of islands like we 
have in the Northern Marianas, when you have got what--round 
numbers--50,000 people collectively, and you have an 
opportunity to access infrastructure funds--super, great, you 
get the money, but you have no workers.
    We are going to be talking about how we can connect 
everybody, but you have some geography considerations that 
people in Nevada and New Mexico just cannot appreciate. And so 
the opportunity for us to understand the impact of COVID, the 
impact of what it means as a territory to be the recipient of 
federal resources to help you out, but to understand that you 
need certain amounts of flexibility.
    Mr. Secretary, you know, I was out there in CNMI back in 
2018 when there were no available workers, and we were talking 
about the CW-1 worker visas then. I can only imagine that after 
all you have gone through since that time, suffering the 
hurricanes that you have, the damage and the rebuilding that 
you need to do, now you have an opportunity to build something, 
but you do not have workers. And I was in the USVI, and it was 
good to see you again, Governor Bryan, but when we looked at 
that hospital that had been blown out--you could see through 
the entire hospital there on St. Croix after the damage from 
Hurricane Maria. And to hear you say you are still building out 
after that, okay, now we want to come in with the broadband, we 
want to help with infrastructure, but where are we getting the 
workforce? And so this is more of a rhetorical question for you 
all right now, but know that that is something that I am keying 
in very dramatically.
    Governor Bryan, you mentioned tourism, and I know in all of 
your other areas--same as well. You rely on tourism for that 
economic base, but when you cannot get--whether it is the 
seasonal workers, COVID has impacted your ability to get cruise 
ships. We relate to that directly in Alaska. We lost an entire 
two years of our tourism season. So maybe this is just me 
saying I feel your pain, but it is something important for this 
Committee to recognize, that we need to give you some flexible 
tools when it comes with the benefits of whether it is ARPA 
funding or whether it is the funding that is coming our way 
under the infrastructure bill.
    Let me ask about energy cost, because you have all 
indicated to the Chairman here that the cost of living has gone 
up, but in so many of the islands I know you are powering 
yourself still off of diesel generation. You have a little bit 
of renewable that you are trying to integrate, but 
realistically, how much progress have you made when it comes to 
more affordable energy for your respective islands?
    And we will start with Governor Bryan.
    Mr. Bryan. Thank you, Senator. Definitely, I love that you 
feel it and understand where we are coming from. Just to put it 
in perspective, with the rising energy costs now in terms of 
fuel--our energy costs are going to go to 48 cents a kilowatt-
hour. An average American pays like ten cents a kilowatt-hour.
    Senator Murkowski. Yes.
    Mr. Bryan. So we need speed in getting to energy 
independence and getting more renewables in there. So that is 
tremendously impactful of what we are doing. We have money to 
do it now, but it takes time, permitting, planning, and all the 
rest. Our housing situation is desperate as well too because 
the hotels were destroyed. So everybody has to stay in Airbnbs. 
Airbnbs are ten times more profitable than workforce housing. 
So our middle class is really doing well collecting those 
rents, but our working class cannot get anyplace to stay. One 
bedroom went in St. Croix from $600 to $1,500 a month. Great 
for the economy, not for workers. There was another piece of 
your question----
    Senator Murkowski. Well, let me--because my time is out and 
I really cannot go over too much, but I just want to ask 
Governor Guerrero, in Guam, again, Guam is an island where you 
are still pretty much reliant on diesel for your power 
generation. What impact has that had on the people in Guam?
    Ms. Guerrero. It is very expensive for our people. And so 
we are trying--we are progressing toward alternative solar 
energy, and our power generation is working toward meeting 
those mandated goals that we have set forth. Additionally, our 
gasoline costs--fuel costs for cars is $5.19 a gallon. What we 
are looking at is, we are strategizing to the direction of 
electrical vehicles. Certainly, the infrastructure bill will 
help us with that. I would love to have all of our island 
transport be electrical vehicles. We are only 30 miles long and 
eight miles wide, so we wouldn't have to be charging that 
frequently. So these are some of the ideas and innovations that 
we are trying in order to decrease energy cost to our residents 
and our island people so that there is more cash-flow for them 
for more spending money for their families.
    Senator Murkowski. Mr. Chairman, I am well over my time, 
but I think this is just true throughout all of the region--the 
cost that people are paying for their fuel, for their 
electricity, for their vehicles. We have to have different 
solutions. That is what this Committee likes to focus on. But 
you are right, it takes a long time to make that transition, 
and you are in high-cost areas to begin with. Thank you, Mr. 
Chairman.
    Senator Heinrich. Thank you.
    Governor Pierluisi, I was quite proud to introduce the 
Puerto Rico Statehood Admission Act along with a number of my 
fellow Senators. And if passed, this legislation would serve as 
Congress's formal offer of statehood to Puerto Rico. There have 
been a number of plebiscites in Puerto Rico on the question of 
statehood, including one just last November, I believe. What 
have Puerto Ricans communicated through these plebiscites?
    Mr. Pierluisi. Well, first and foremost, their desire to 
have a permanent union with the United States. Start with that. 
And what they are saying, loud and clear, they have been saying 
it now for quite a while, is that they want equality. They want 
to be treated the same as their fellow citizens in the states. 
Now, the last plebiscite we had, for the first time ever, was 
an up or down vote on statehood. So you could not say, ``hey, 
you left me out.''
    Senator Heinrich. There was no option--it was a clean 
choice.
    Mr. Pierluisi. There was no option. It was so well-defined. 
Everybody knows what statehood is all about. So what we are 
doing here, our resident commissioner is sitting here in this 
hearing--Resident Commissioner Jenniffer Gonzalez. She 
introduced a bill very similar to yours, along with Congressman 
Darren Soto, and it is a very straightforward bill, basically 
saying let's have Congress call for us a vote on statehood in 
Puerto Rico. And if we give you a majority, then implement it.
    Now, I recognize that there are other competing bills, and 
I also know that there is an ongoing effort to try to get a 
consensus bill. But what I will say to this Committee is that 
it is very important that we get a vote--that for the first 
time ever, Congress at the very least asks the people of Puerto 
Rico--the American citizens of Puerto Rico--to vote on their 
political future and then commit to implementing the will of 
the majority. That is what democracy is all about. If you want 
to do a multiple-option bill, you can. I am not afraid. I am 
not afraid of the people's will, and that is all we are asking. 
It is only fair. And I know that Congress will have the last 
say. The way that statehood works--or could work--is if a 
majority in both the House and the Senate vote for it. And we 
know that we will have to go through that process. But the 
first step is the one that you are asking for, you did it in 
terms of statehood, and I respect that. I support that. But if 
for some reason you want to have multiple options and they are 
well defined, I have no problem whatsoever with it, so long as 
you ask the people of Puerto Rico, for once and for all----
    Senator Heinrich. And I should say welcome to your----
    Mr. Pierluisi [continuing]. To express their wishes.
    Senator Heinrich [continuing]. Resident Commissioner as 
well, and it has been a pleasure to work with you both on this 
issue. You know, even with a majority of Puerto Ricans voting 
in favor of statehood, there is still an argument that a status 
convention is needed. Do you believe, Governor, that a status 
convention is necessary, given the outcome of the recent 
plebiscites?
    Mr. Pierluisi. You would simply be prolonging an endless 
debate. To debate what? Status convention for what? I mean, 
that is not the way Congress acts.
    Senator Heinrich. So it really doesn't add anything to the 
process----
    Mr. Pierluisi. No.
    Senator Heinrich [continuing]. That is not clear from just 
asking the people what they want.
    Mr. Pierluisi. Exactly. The best thing is to ask the people 
directly. There will be a debate. They will be informed by the 
debate and Congress should act on this. That's my ask.
    Senator Heinrich. So Governor, you used the word----
    Mr. Pierluisi. Recognizing that Congress has the last say 
because this is not like we can impose this.
    Senator Heinrich. Right.
    Mr. Pierluisi. I know.
    Senator Heinrich. Governor Pierluisi, you used the word 
equality. I remember Governor Bryan, I cannot remember exactly 
how you phrased it, but I think one of the things that should 
be very clear from this hearing is that we have a current 
system where an American citizen on the mainland is treated 
differently than an American citizen in a territory. For any of 
you, what message does that send, and what should we be hearing 
about the fairness or lack of fairness built into that, and 
what we should do about it in law?
    Governor Bryan, I will let you start, and anyone else who 
wants to chime in.
    Mr. Bryan. I always go quickly. I always go first. I will 
go quickly. I think it just says that there is an absence of 
equality, and when you look at the fact that these are black 
and brown people, and that they are probably among the more 
poor Americans statistically--lack of access to healthcare, 
lack of access to education and opportunities. It is a slap in 
the face. It is something that we should have an affirmative 
action on to make sure we right.
    Senator Heinrich. Governor.
    Ms. Guerrero. I totally agree. I think it is very 
discriminatory against the people that live in the islands, and 
more importantly, I think our plight in Guam is much more for 
also going toward self-determination. Puerto Rico has had their 
plebiscite. We have not had our plebiscite. And so we are 
working toward trying to do that, and we are asking Congress 
for their support and their help in moving that forward. The 
United Nations has already said that the U.S. should allow Guam 
to go forward with their vote on self-determination, and I 
think the U.S. is slow in its support and in its articulation 
for our right to self-determination.
    Senator Heinrich. Anyone else? Governor Pierluisi.
    Mr. Pierluisi. As a matter of federal policy, it makes no 
sense to treat American citizens in the territories 
differently, because we are not immigrants. We can hop on a 
plane and move to the states any day. So the case of Puerto 
Rico is different because we are asking for voting rights. We 
are asking to vote. We want to vote for the President and 
voting representation in Congress. And I agree, it is different 
than the other territories, but you should be treating American 
citizens the same in all federal programs.
    Senator Heinrich. But individual Americans.
    Mr. Pierluisi. Yes, because otherwise----
    Senator Heinrich. Yes, I think that would shock most 
Americans to learn that if they decide to move to a different 
location, that they get treated differently based on that. And 
I think that would be a surprise to most folks.
    I am over my time as well, but I want to go back to our 
Ranking Member for the next round of questions.
    Senator Marshall. All right, thank you, Chairman.
    My first question is for Governor Mauga. According to the 
United States Coast Guard, ``Illegal, unreported, and 
unregulated fishing has replaced piracy as the leading global 
maritime security threat. If illegal, unreported, and 
unregulated fishing continues unchecked, we can expect 
deterioration of fragile coastal states and increased tension 
among foreign fishing nations threatening geopolitical 
stability around the world.''
    So my question for you, Governor, is how does the Chinese 
illegal fishing around American Samoa and the region impact 
your economy and the stability of your neighborhood?
    Mr. Mauga. Honorable Senator, yes, it does impact our 
economy with the canneries that we have in American Samoa. The 
problem with us in American Samoa is the enforcement part of 
that process. We do not have the resources to enforce over the 
200 miles out of American Samoa ocean, and so, we have been 
working hard with the Coast Guard in trying to implement ways 
to make sure that such policies and laws are implemented, are 
enforced, and like I said, it does affect us very seriously in 
terms of fishing in our ocean.
    Senator Marshall. Thank you for that answer.
    I will go to Governor Guerrero next.
    In my opening statement I mentioned the threats currently 
facing Guam and the need to face those threats, in particular, 
those posed by China. Can you elaborate on the activities of 
China that are of concern to Guam?
    Ms. Guerrero. The activities of China are such that they 
are trying to win the war through economic success, and we see 
this throughout the neighboring islands--not so much in our 
island, Senator, but we see it in the neighboring islands. And 
they would go in and offer loans, grants, and so forth, and of 
course, try to tie the islands to that commitment, and that is 
a very dangerous strategy, I think. Our relationship with the 
military bases has been so good, and as you know, they have 
made several practices in Guam--air practices, marine 
practices, and also to show force to China that they are 
strong, that the U.S. is strong and the forces are there and to 
back off and not come by.
    My greatest concern is their arguments between Taipei--
Taiwan and China, and of course, the U.S. has to make the 
position of an ally to Taiwan. And so, if it comes down to 
battles and so forth, we are right there in the middle of the 
Pacific with the military bases there. So of course, we would 
participate and be involved, but that is a great concern for 
myself and our people in Guam.
    Senator Marshall. Are your neighbors far enough along in 
the relationship, the business relationships with the Chinese 
that they have an opinion on how that is working out?
    Ms. Guerrero. I think for some countries, yes. And that 
some countries are in the position of relationships with China 
and the whole battle against the ``One China'' policy. And so 
some of the island states are being very much in relationship 
and partnership with China, and some of them are in 
relationship and partnerships with Taiwan.
    Senator Marshall. Okay, I will go on to Secretary Atalig as 
well, kind of continuing my questions about China in the 
Pacific. In 2019, Kiribati and the Solomon Islands severed 
their relationships with Taiwan and established better 
relationships with China. Are you concerned about China's moves 
in the Pacific with regard to your neighbors, where China might 
try and build military installations or expand illegal fishing, 
and what would that mean to the economy and your security?
    Mr. Atalig. Thank you, Senator.
    We are in the same sentiment as the Territory of Guam. We 
share the same waters and the same distance. We are just a half 
an hour flight away. But to the question of the economic 
dominance that they are trying to do in other neighboring 
islands, I do not have a straight answer from our position. We 
do know that other islands are benefiting, you know, 
financially, in terms of economic input into their economy. But 
we are under the U.S. flag, so we seek to this body for our 
assistance, and we continue to build on our partnerships. So I 
will bring back this question to our leadership and make sure 
we have a thorough answer and response for the Committee.
    Senator Marshall. Thank you so much, everybody. I yield 
back.
    Senator Heinrich. Before we turn to Senator Hirono, I just 
want to acknowledge the news that just broke that my friend and 
colleague, Ben Ray Lujan, is recovering in the hospital from a 
minor stroke, and I am sure that you will all join me in 
wishing him a very, very speedy recovery.
    Senator Hirono, the floor is yours.
    Senator Hirono. Thank you very much for letting us know 
about our colleague. Of course, we wish him a speedy recovery.
    I welcome all of the Governors for coming to testify today, 
and Mr. Secretary, as we talk about the influence and the 
presence of China in the Indo-Pacific area of responsibility, I 
think that they very much had a presence in CNMI, correct, Mr. 
Secretary? Mr. Secretary?
    Mr. Atalig. Yes, I am sorry.
    Their presence was in terms of bringing tourists in.
    Senator Hirono. Yes, so they had quite a presence and I 
think they were bringing gaming into CNMI. At the same time, 
because of our relationship with CNMI, I believe that we are 
negotiating with CNMI for military training facilities on CNMI. 
Is that happening?
    Mr. Atalig. As part of the military buildup on Guam, there 
are also negotiations in terms of a divert air station in 
Tinian--in one of our islands.
    Senator Hirono. Are those negotiations proceeding?
    Mr. Atalig. It has started already. I mean, the 
negotiations are completed. They have started the rebuild.
    Senator Hirono. Thank you very much. I also serve on the 
Armed Services Committee, and the movement of our troops out of 
Okinawa and then to Guam, and then they need the training, so 
thank you very much for that support.
    Governor Pierluisi, it is nice to see you. We served 
together in the U.S. House.
    Mr. Pierluisi. Very nice to see you.
    Senator Hirono. So I have a few questions for you, but I 
will start with Governor Guerrero and again, Mr. Secretary 
Atalig.
    We each have high populations of citizens of the Freely 
Associated States residing in our respective jurisdictions, and 
I am talking about Hawaii, of course. And the COFA (Compacts of 
Free Association) citizens have been important and contributing 
members of society in Hawaii, Guam, and the Marianas for 
decades. However, certain financial provisions of the Compacts, 
including $30 million in annual Compact-Impact funding, will 
expire in 2023. And while it is widely recognized that Compact-
Impact funding is insufficient to cover the cost borne by our 
affected jurisdictions, how would Guam and the Marianas be 
affected if the U.S. Government failed to extend Compact-Impact 
funding past 2023 and fail to renegotiate the Compact of Free 
Associations before they expire in 2023 and 2024?
    Governor Guerrero, I will start with you.
    Ms. Guerrero. Thank you, Senator.
    If the government does not renegotiate the Compact funding 
and continue on with the funding and continue on with the 
migration ability of COFA, then it, I think, would be an 
unequal kind of treatment because we will continue to have 
those migrations over to Guam and not have the funding source 
to even help with those expenses and those impacts. You are 
absolutely right, $30 million is not enough. We have calculated 
our expenses to be about $150 million a year as a result of the 
impact of migration, which impacts our social services, our 
education, our healthcare. Now, I just want to make it very 
clear that we love our brothers and sisters from the islands, 
and we want to help as much as we can, but we would like to 
have the financial means and the funding source to continue on 
with that help. $30 million is not enough, but to stop $30 
million, I think is significant in terms of helping with the 
expenses of the migration. So it is not fair, I believe, if the 
funding stops but the migration continues.
    Senator Hirono. Presumably, if the Compacts do not get 
renegotiated, then there will not be an ability for the Compact 
citizens to come to our territories and to our places.
    Mr. Secretary, would you like to add anything? I mean, I 
assume you would agree $30 million is not enough.
    Mr. Atalig. Yes, I would, I do, although, like Governor 
Leon Guerrero said, we love our brothers and sisters and we 
welcome them to our islands. However, we know that the current 
allocations for Compact-Impact are very minimal and don't even 
put a dent in the cost that we put to provide the services to 
these people that come and visit and stay on our islands. So, 
just on a similar note, without a renegotiation and more 
funding for the islands, it does put a burden on certain 
government services that we provide.
    Senator Hirono. I hope that finally restoring Medicaid 
eligibility to the Compact citizens, I hope that is having a 
positive impact. And we need to pretty much restore the 
capacity for them to be able to access other programs, such as 
SNAP, and all the other array of social programs. That is what 
some of us are working on.
    I am sorry that I have run out of time, so I did want to 
have a chat with Governor Pierluisi, but that will wait. Thank 
you, Mr. Chairman.
    The Chairman [presiding]. Let me ask, first of all, is 
Senator Cassidy on or did he log off? He logged off? Okay.
    Senator Kelly--do you know if he is on or logging off? And 
if not, we will have a second round if anyone has a quick 
second round they want to go through.
    Senator Heinrich.
    Senator Heinrich. Just one quick follow-up question. I know 
Senator Cortez Masto raised this issue too--now that the plan 
of adjustment has been approved by the court, what is the role 
of the Financial Oversight and Management Board, and do we need 
to take action to clarify when that reaches finality?
    Mr. Pierluisi. Yes, I believe you do. What's happening is 
this: we just approved--the federal court just confirmed the 
plan of adjustment for the government in Puerto Rico. That is a 
milestone. The bankruptcy is going to be behind us. We just 
need to issue 
the restructured bonds on March 15th, which is fast 
approaching. There are two other reorgs, or restructurings--
bond restructurings that need to occur. Very important--the 
power authority's bond restructuring, as well as the highway 
and transportation authority's. For the power authority, you 
are talking about $9 billion. The other one is $4 billion. So 
you are talking about serious bond restructurings. Once those 
two are done and we are able to publish all outstanding or 
pending audited financial statements for the government of 
Puerto Rico, it will be the ideal point for the Board to part 
ways. And I say this with respect.
    Chairman, fellow former Governor, I mean, you know that--
you all know--the budget process is very important. That is 
where you set your priorities. That is where elected 
officials--I am not talking about myself as Governor, but the 
legislators, as well, set their priorities, and the problem has 
been that the Board, before my tenure, you know, became so 
granular in approving budgets in Puerto Rico that because 
PROMESA says that they need to approve any reprogramming, it is 
incredible. It is becoming a bureaucratic layer that we should 
not have in Puerto Rico. We want to expedite things in Puerto 
Rico. Just let me give you a stat. In this fiscal year, 
starting in July, we have submitted to the Board 267 
reprogramming requests, and it takes roughly three weeks, on 
average, for the Board to reply. I have been telling the Board, 
hey, you need to expedite this. And so what we want is, once 
the bond restructurings are done, when the financial statements 
are audited, the financial statements are out, the spirit of 
PROMESA, if not the letter, says once Puerto Rico is able to 
balance its budgets--and we will definitely be able to, given 
the debt restructuring that just happened, and once Puerto Rico 
regains access to the capital markets, and I tell you the way 
that the bonds are being sold and at the prices they are being 
sold at, it shows that we have adequate access to the markets 
already--the Board should not exist anymore. It is 
undemocratic.
    We did it. I was in Congress when we did it, because we had 
no choice. The government then was about to default on its 
general obligation bonds. Nobody liked that vote. And some 
members of the Senate, a minority, didn't vote for it. A wide 
majority did. And the same happened in the House. If I am 
telling you with a straight face that it is about time to start 
this conversation, and at some point, provide so that the 
government of Puerto Rico substitutes for the Board in dealing 
with PROMESA or any other restructuring effort in the future, 
it is for the better.
    The Chairman. This question might have been asked, if I 
may, okay?
    The only thing I would ask--do the territories have 
balanced budget amendments like states do?
    Mr. Pierluisi. We do. In Puerto Rico----
    The Chairman. But you mostly got behind. You must have had, 
I mean, it didn't work.
    Mr. Pierluisi. Yes.
    The Chairman. Whoever--or the discipline wasn't there. 
Something happened.
    Mr. Pierluisi. The discipline wasn't there.
    The Chairman. As a former Governor, I could not go a week 
without making adjustments. Every week, like clockwork, I had 
to make an adjustment. So if you got out of whack it is because 
someone was not paying attention. The Federal Government 
stepped in. They are going to have to show good cause or 
reasons to give you the lead way again, and I think that is 
what we are probably running up against right now. I know it 
has been--and also, the people that are administering this too. 
There has been a tug-of-war over who is doing what and this and 
that. I have heard all about that. Who's on whose side, right?
    Mr. Pierluisi. Yes, but again, we just went through this 
unprecedented bankruptcy process. The debt level will have us 
clearly sustainable. By the way, we were committed to paying 
roughly 25 cents of the revenues the government got. Now we 
will be paying 7.8 cents on the dollar as opposed to 25 cents. 
It is incredible savings.
    The Chairman. Right.
    Mr. Pierluisi. And we are doing all the right things. I 
have to give credit to the Board. There is a lot more 
transparency with respect to Puerto Rico's finances than ever. 
And that is to the Board's credit. But there comes a time when 
you need the elected officials to be the ones----
    The Chairman. Sure.
    Mr. Pierluisi [continuing]. Setting the priorities, and 
every four years we have elections, like you do here. Nobody in 
Puerto Rico wants to go through this mess we went through. The 
austerity we faced in the last years was something, and we do 
not want to go there again.
    The Chairman. Well, the bond rating is basically----
    Mr. Pierluisi. But I say this with respect. It is just a 
matter that it could be a simple, straightforward amendment to 
the PROMESA law, and when the time comes, once the PREPA--the 
power company restructuring--happens, and the highway authority 
structuring happens, it will be the ideal point, I tell you, to 
allow Puerto Rico to have self-government again--democracy 
again.
    The Chairman. Senator Hirono, I think you might have had 
another question.
    Senator Hirono. Just listening to your testimony and the 
high cost of everything in the territories, I realize that a 
lot of the federal programs are administered differently or 
treated differently with regard to your territories, but one 
that I am particularly interested in is how Medicaid is treated 
and that you have a cap, because I believe that access to 
healthcare is a right, not a privilege. And so the fact that we 
have a cap placed on all of you in terms of Medicaid is 
something that I am going to look at, and Governor Pierluisi, 
thank you. You are one of the people who mentioned that in your 
testimony, but it will probably help all of you to have us lift 
that cap.
    Thank you, Mr. Chairman.
    Mr. Bryan. Senator Manchin, can I add one thing?
    The Chairman. Absolutely.
    Mr. Bryan. In this conversation with Puerto Rico, you know, 
all of us go through precarious financial situations. If this 
body would just allow the Treasury to give us an option to back 
our bonds with full faith and credit, just for the small 
territories, as an option that would have to be approved by the 
Treasury, that move alone would reduce the amount of debt level 
because we can go to market, refinance that debt at AAA, and 
probably save, for us, at least ten percent annual payments 
from our budget and redirect that toward doing things for our 
own. We are doing that now with some of our rum-proceed bonds, 
and with our general obligation bonds we could do the same 
thing and put us all on very good footing.
    The Chairman. I would assume all of your bonds are based on 
basically the liquidity of your territory, correct? It is not 
basically with the full faith of the Federal Government 
Treasury.
    Mr. Bryan. It is not.
    The Chairman. Okay. That would--that is something, 
absolutely--I would be happy to look into that. That makes a 
lot of sense.
    The thing about it, I was going to say, is on balanced 
budget amendments, how in the states we did it is that it was 
part of an election process. If you were Governor for four 
years and you were running for reelection, and you had not had 
a bond increase or a bond rating that showed that you were good 
fiscal managers, it would affect you. Ours is a balanced 
budget. We had to, at the end of the year, so we would 
basically make adjustments. We would look at it every week, and 
on a monthly basis we would make the adjustments so they 
wouldn't be so harsh at the end of the year. You wait until the 
end of the year and they get so absolutely harsh and hard-
hitting that people just could not take it, but you made 
gradual adjustments, as you could see your revenue and forecast 
and all that. And I am sure you all have people that are doing 
it in your finance department.
    We want you all to succeed. We really do. We want to help 
you, but that is something we can take, and maybe with this 
Committee here, we will get a letter, a bipartisan letter 
asking the Treasury to give us an understanding of why they 
have not backed our territories with the full faith of the U.S. 
Treasury. Do you want to do that? Are you okay with that? We 
will do that.
    So with that, any other questions to come before the 
Committee?
    [No response.]
    The Chairman. Any other questions to our panel?
    [No response.]
    The Chairman. If not, the members will have until the close 
of business tomorrow to submit additional questions for the 
record. And the Committee stands adjourned. Thank you, all.
    [Whereupon, at 4:34 p.m., the hearing was adjourned.]

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