[Congressional Record Volume 141, Number 113 (Thursday, July 13, 1995)]
[Senate]
[Page S9937]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                CBO ESTIMATES ON INSULAR DEVELOPMENT ACT

 Mr. MURKOWSKI. Mr. President, on June 30, 1995, I filed Report 
104-101 to accompany S. 638, the Insular Development Act of 1995, that 
had been ordered favorably reported on June 28, 1995. At the time the 
report was filed, the estimates by Congressional Budget Office were not 
available. The estimate is now available and concludes that enactment 
is now available and concludes that enactment of S. 638 would result in 
no significant cost to the Federal Government and in no cost to State 
or local governments and would not affect direct spending or receipts. 
I ask that the text of the CBO estimate be printed in the Record.
  The text follows:
                                      Congressional Budget Office,


                                                U.S. Congress,

                                    Washington, DC, July 11, 1995.
     Hon. Frank H. Murkowski,
     Chairman, Committee on Energy and Natural Resources, U.S. 
         Senate, Washington, DC.
       Dear Mr. Chairman: The Congressional Budget Office has 
     reviewed S. 638, the Insular Development Act of 1995, as 
     reported by the Committee on Energy and Natural Resources on 
     June 30, 1995. CBO estimates that S. 638 would result in no 
     significant cost to the federal government and in no cost to 
     state or local governments. Enacting S. 638 would not affect 
     direct spending or receipts; therefore, pay-as-you-go 
     procedures would not apply.
       S. 638 would restructure as agreement for making payments 
     to the Commonwealth of the Northern Mariana Islands (CNMI). 
     Presently, the federal government is obligated to make annual 
     payments of $27.7 million to CNMI. S. 638 would maintain that 
     funding commitment but would expand the purposes for which 
     those funds could be spent. Based on a 1992 agreement reached 
     between CNMI and the federal government, CNMI would receive a 
     declining portion of those funds for infrastructure 
     development through fiscal year 2000. The remaining funds 
     would be used for capital infrastructure projects in American 
     Samoa in 1996 and in all insular areas in 1997 and 
     thereafter. (Insular areas include Guam, the Virgin Islands, 
     American Samoa, CNMI, the Republic of Palau, the Federated 
     States of Micronesia, and the Republic of the Marshall 
     Islands.) Of the funds designated for 1997 and thereafter, $3 
     million would be designated for the College of the Northern 
     Marianas in 1997 only, and $3 million would be allocated each 
     year to the Department of the Interior (DOI) for either 
     federal or CNMI use in the areas of immigration, labor, and 
     law enforcement. Additionally, beginning in fiscal year 1997, 
     DOI would be required to prepare and update annually a five-
     year capital infrastructure plan for insular projects.
       CBO estimates that the reallocation of funds that would 
     occur under this bill would have little, if any, effect on 
     the rates at which such funds are spent. CBO has no reason to 
     expect that infrastructure funds used by other insular areas 
     would be spent at a rate different from those used by CNMI. 
     Also, based on information provided by the DOI, CBO estimates 
     that
      the bill's capital infrastructure planning requirement would 
     result in no significant cost to the federal government.
       S. 638 also would gradually apply the minimum wage 
     provisions of the Fair Labor Standards Act (FLSA) to CNMI, 
     which would require enforcement activity by the Department of 
     Labor (DOL). The department expects that it would continue to 
     receive annually $800,000 of the CNMI funds allocated to DOI 
     for immigration, labor, and law enforcement purposes. DOL 
     uses these funds to train CNMI officials to enforce labor 
     laws, while providing additional temporary enforcement 
     assistance. Based on information from the DOL, CBO expects 
     that DOL would continue to receive these funds under this 
     bill and that they would be sufficient to conduct FLSA 
     enforcement. Therefore, we estimate that no additional costs 
     to the federal government would result from this provision.
       Additionally, S. 638 would require that DOI continue to 
     submit annually to the Congress a report on the ``State of 
     the Islands,'' as well as a report on immigration, labor, and 
     law enforcement issues in CNMI. The bill also would make 
     several clarifications to existing law and would require 
     cooperation in immigration matters between CNMI and the 
     Immigration and Naturalization Service. CBO estimates that 
     these provisions would result in no significant cost to the 
     federal government.
       If you wish further details on this estimate, we will be 
     pleased to provide them. The CBO staff contact is John R. 
     Righter, who can be reached at 226-2860.
           Sincerely,
                                                  June E. O'Neill,
                                                 Director.
     

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