[Congressional Record Volume 146, Number 100 (Thursday, July 27, 2000)]
[Senate]
[Pages S7897-S7898]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. AKAKA (for himself and Mr. Inouye):
  S. 2983. A bill to provide for the return of land to the Government 
of Guam, and for other purposes; to the Committee on Energy and Natural 
Resources.


                   the guam omnibus opportunities act

  Mr. AKAKA. Mr. President, I rise to introduce the Guam Omnibus 
Opportunities Act, which seeks to address important issues to the 
people of Guam dealing with land, economic development and social 
issues. On July 25, the House passed similar legislation, H.R. 2462, 
which was introduced by Congressman Robert Underwood, the Delegate from 
Guam. During the 105th Congress, the Senate passed similar provisions 
of H.R. 2462 as part of S. 210, an omnibus territories bill.
  There are several provisions of the Guam Omnibus Opportunities Act. 
First, Section 2 of the bill provides a process for the Government of 
Guam to receive lands from the U.S. government for specified public 
purposes by giving Guam the right of first refusal for declared federal 
excess lands by the General Services Administration prior to it being 
made available to any other federal agency. It also provides for a 
process for the Government of Guam and the U.S. Fish and Wildlife 
Service to engage in negotiations on the future ownership and 
management of declared federal excess lands within the Guam National 
Wildlife Refuge.
  Section 3 provides the Government of Guam with the authority to tax 
foreign investors at the same rates as states under U.S. tax treaties 
with foreign countries since Guam cannot change the withholding tax 
rate on its own under current law. Under the U.S. Internal Revenue 
Code, there is a 30 percent withholding tax rate for foreign investors 
in the United States. Since Guam's tax law ``mirrors'' the rate 
established under the U.S. Code, the standard rate of foreign investors 
in Guam is 30 percent. It is a common feature in U.S. tax treaties for 
countries to negotiate lower withholding rates on investment returns. 
Unfortunately, while there are different definitions for the term 
``United States'' under these treaties, Guam is not included. This 
omission has adversely impacted Guam since 75 percent of Guam's 
commercial development is funded by foreign investors. As an example, 
with Japan, the U.S. rate for foreign investors is 10 percent. This 
means that while Japanese investors are taxed at a 10 percent 
withholding tax rate on their investments in the fifty states, those 
same investors are taxed at a 30 percent withholding rate on Guam.
  While the long-term solution is for U.S. negotiators to include Guam 
in the definition of the term ``United States'' for all future tax 
treaties, the immediate solution is to amend the Organic Act of Guam 
and authorize the Government of Guam to tax foreign investors at the 
same rates as the fifty states. It is my understanding that all other 
U.S. territories have remedied this problem in one way or another. 
Therefore, Guam is the only U.S. jurisdiction in the country that is 
not extended tax equity for foreign investors.
  With an unemployment rate of 15 percent, Guam continues to struggle 
economically due to the Asian financial crisis. That is why I believe 
it is vitally important for the federal government to assist Guam in 
stimulating its economy through sound federal policies and technical 
assistance. This section would greatly assist the Government of Guam in 
promoting economic development on the island and would provide long 
needed tax equity.
  Section 4 considers Guam within the U.S. Customs zone in the 
treatment of betel nuts, which are part of Chamorro tradition and 
culture. While betel nuts are grown in the United States, the Food and 
Drug Administration (FDA) has an important alert for betel nuts from 
foreign countries in place due to the influx of betel nuts from Asian 
countries for commercial consumption and the FDA's contention that the 
betel nut is ``adulterated.'' This means an automatic detention of 
betel nuts by U.S. Customs agents when entering the United States. 
Although Guam is a U.S. territory, Guam is considered to be outside the 
U.S. Customs zone. Betel nuts grown in Guam, therefore, are subject to 
the FDA ban in the same manner as foreign countries. This section 
narrowly applies to Guam, limits use to personal consumption, and 
ensure that the FDA ban against foreign countries remains in place.
  Section 5 empowers the governors of the territories and the State of 
Hawaii to report to the Secretary of the Interior on the financial and 
social impacts of the Compacts of Free Association on their respective 
jurisdictions and requires that the Secretary forward Administration 
comments and recommendations on the report to Congress. This is an 
important issue to the State of Hawaii as the numbers of migrants to 
Hawaii from the Republic of the Marshall Islands, the Federated States 
of Micronesia, and the Republic of Palau continue to grow. The State of 
Hawaii has spent well over $14 million in public funds in the past year 
alone, with most of the funds being spent on our educational and health 
care systems.
  Under the compact agreements, the Federal government made clear that 
it would compensate jurisdictions affected, yet the State of Hawaii has 
not received federal funding since the implementation of these 
agreements. This section seeks to improve the reporting requirements 
for Compact Impact Aid to address this situation.
  Section 6 establishes a five-member Guam War Claims Review Commission 
to be appointed by the Secretary of the Interior. The goal of the 
Commission is to review the facts and circumstances surrounding U.S. 
restitution to Guamanians who suffered compensable injury during the 
occupation of Guam by Japan during World War II. Compensable injury 
includes death, personal injury, or forced labor, forced march, or 
internment. The Commission would review the relevant historical facts 
and determine the eligible claimants, the eligibility requirements, and 
the total amount necessary for compensation, and report its findings 
and recommendations for action to Congress nine months after the 
Commission is established.
  The 1951 Treaty of Peace between the U.S. and Japan effectively 
barred

[[Page S7898]]

claims by U.S. citizens against Japan. As a consequence, the U.S. 
inherited these claims, which was acknowledged by Secretary of State 
John Foster Dulles when the issue was raised during consideration of 
the treaty before the Committee on Foreign Relations in 1952.
  Considerable historical information indicates that the United States 
intended to remedy the issue of war restitution for the people of Guam. 
In 1945, the Guam Meritorious Claims Act was enacted which authorized 
the Navy to adjudicate and settle war claims in Guam for property 
damage for a period of one year. Claims in access of $5,000 for 
personal injury or death were to be forwarded to Congress. 
Unfortunately, the Act never fulfilled its intended purposes due to the 
limited time frame for claims and the preoccupation of the local 
population with recovery from the war, resettlement of their homes, and 
rebuilding their lives.
  On March 25, 1947, the Hopkins Commission, a civilian commission 
appointed by the Navy Secretary, issued a report which revealed the 
flaws of the 1945 Guam Meritorious Claims Act and recommended that the 
Act be amended to provide on the spot settlement and payment of all 
claims, both property and for the death and personal injury.
  Despite the recommendations of the Hopkins Commission, the U.S. 
government failed to remedy the flaws of the Guam Meritorious Act when 
it enacted the War Claims Act of 1948, legislation which provided 
compensations for U.S. citizens who were victims of the Japanese war 
effort during World War II. Guamanians were U.S. nationals at the time 
of the enactment of the War Claims Act, thereby making them ineligible 
for compensation. In 1950, with the enactment of the Organic Act of 
Guam, Guamanians became U.S. citizens.
  In 1962, Congress again attempted to address the remaining 
circumstances of U.S. citizens and nationals that had not received 
reparations from previous enacted laws. Once again, however, the 
Guamanians were inadvertently made ineligible because policymakers 
assumed that the War Claims Act of 1948 included them. Section 6 brings 
closure to this longstanding issue.
  In summary, Mr. President, the Guam Omnibus Opportunities Act will go 
a long way toward resolving issues that the Federal Government has been 
working on with the Government of Guam on land, economic development 
and social issues. I look forward to working with my colleagues in the 
Senate to resolve these issues to assist Guam in achieving greater 
economic self-sufficiency.
                                 ______