[Senate Report 106-240]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 456
106th Congress                                                   Report
                                 SENATE
 2d Session                                                     106-240

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



 
             BIKINI RESETTLEMENT AND RELOCATION ACT OF 1999

                                _______
                                

                 March 9, 2000.--Ordered to be printed

                                _______
                                

  Mr. Murkowski, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 2368]

    The Committee on Energy and Natural Resources, to which was 
referred the Act (H.R. 2368) to assist in the resettlement and 
relocation of the people of Bikini Atoll by amending the terms 
of the trust fund establishment during the United States 
administration of the Trust Territory of the Pacific Islands, 
having considered the same, reports favorably thereon without 
amendment and recommends that the Act do pass.

                         purpose of the measure

    The purpose of H.R. 2368 is to approve a one-time three 
percent distribution from the Bikini Resettlement Trust Fund to 
the people of Bikini.

                          background and need

    Following the close of World War II, the United States 
began a nuclear testing program in the northern Marshall 
Islands. The area, which had been administered by Japan under a 
League of Nations Mandate, eventually was placed under the 
United Nations trusteeship system as part of the Trust 
Territory of the Pacific Islands, which included the Marshall 
Islands, the Carolines, and the Marianas (except for Guam). The 
Trust Territory of the Pacific Islands was the only strategic 
trusteeship created with oversight by the Security Council, 
rather than the General Assembly.
    In 1946, the population of 167 at Bikini was relocated, 
first to Rongerik and then two years later briefly to Kwajalein 
and then to Kili island. Unlike Bikini, which is a large atoll 
with a sheltered lagoon, Kili is an island with little reef and 
no lagoon. Expectations at the time of relocation were that the 
population would be allowed to return to Bakini at the end of 
the testing program. Between 1946 and 1958, 23 atomic and 
hydrogen bombs were tested at Bikini, vaporizing several 
islands. In 1969, a small portion of the population were 
permitted to return to Bikini. They were removed in 1978 when 
tests disclosed that the population had ingested elevated doses 
of radiation. Following the removal, the United States 
undertook a program at Bikini to test various methods to reduce 
or eliminate the uptake of radiation in the food chain. The 
United States has made various ex gratia payments to the Bikini 
people as well as a comprehensive settlement of $75 million as 
part of the espousal provisions of the Compact of Free 
Association (sec. 177). In addition to the settlement contained 
in the Compact, the United States also committed to ``provide 
funds for the resettlement of Bikini Atoll by the people of 
Bikini at a time which cannot now be determined'' (Art. VI, 
Sec. 1 of the 177 Subsidiary Agreement). Congress went beyond 
that statement when it approved the Compact in 1986 by 
including in section 104(l) a pledge of full faith and credit 
to fund a settlement agreement that had been entered into with 
the Bikini people.
    The Bikini Resettlement Trust Fund was originally 
established in 1982 by the FY 1982 Supplemental Appropriation 
legislation (P.L. 97-257) which appropriated $20.6 million for 
the people of Bikini of which $3 million would be distributed 
to individuals under a newly devised ``head of household'' 
formula and the balance placed in a tax-free, interest-bearing 
trust with the income and corpus, if necessary, to be expended 
for the relocation and resettlement of the Bikini people. At 
the time, since rehabilitation of Bikini itself was unresolved, 
the bulk of the expenditures were intended to go to improving 
conditions for the population residing on Kili and Ejit 
islands. The initial 25 year term of the trust was set to 
coincide with what was then estimated to be the time at which 
Bikini would be safe for human habitation. In 1988, a further 
appropriation of $90 million was made to satisfy the 
requirements of the Compact legislation and the settlement 
agreement. The total contribution to the fund amounted to $110 
million and the market value today is approximately $126 
million.
    Congress provided what it believed would be a sufficient 
corpus to provide for resettlement based on the removal of 
contaminated soil near residences with potassium treatment to 
block the uptake of cesium elsewhere. The decision, however, on 
the actual program was left to the Bikini population with the 
understanding that they could let the Fund grow until it could 
support a more expansive program, if that is what they wanted. 
The Bikini people have yet to come to a final agreement on how 
to proceed. Resettlement has proved to be a difficult task for 
several reasons, not the least of which is the memory of the 
failed resettlement effort in 1969. Efforts to settle on a 
resettlement program have also been complicated by debates over 
what constitutes a safe environment. As resettlement is 
delayed, the original population who were relocated has 
dwindled to about 90. This legislation would provide a one-time 
payment at the request of the Bikini people in recognition of 
the fact that most of those alive in 1946 may not survive to 
return to a fully restored Bikini.
    While the legislation provides for a distribution to the 
``People of Bikini,'' the Committee was advised by the counsel 
for the people of Bikini that the distribution formula adopted 
by the people of Bikini, and used in the 1988 distribution, 
will primarily benefit the elders of Bikini in their capacity 
as elders and as heads of households. This is the distribution 
method that the people of Bikini deem appropriate.
    The Committee is concerned with the effect of commingling 
the two Bikini funds. The original fund was established in 1982 
by the FY 1982 Supplemental Appropriation Act (P.L. 97-257) 
which provided $20.6 million for the people of Bikini, of which 
$3 million was distributed and the balance placed in a trust 
for relocation and resettlement. At the time, the understanding 
was that the proceeds would go primarily to the populations 
residing in Kili and Edit islands. In 1988, a further 
appropriation of $90 million was made to satisfy the 
requirements of the Compact legislation and the settlement 
agreement. Those funds were intended primarily to provide a 
corpus for resettlement of Bikini atolls. By combining the two 
funds, the objectives of each have become intertwined.
    The decision to reinvest annual interest income, thereby 
enlarging the corpus, or to spend the interest to provide for 
education and other community needs is one for the people of 
Bikini to make. The Committee wants to caution, however, that 
should the people of Bikini at some future time seek additional 
assistance in resettlement, Congress is likely to consider not 
only this distribution, but also all annual distributions in 
determining whether further ex gratia contributions are 
justified. The Committee will not prejudge what a future 
Congress will do, but does believe that a note of caution is 
warranted.
    At the Committee hearing, the representative of the people 
of Bikini testified that, because of prudent investment and 
restraint by the Bikini Council, the corpus of the trust fund 
remains intact and the fund has earned almost 14 percent 
annually. A comparison of the trust fund's value to the 
consumer price index offers a somewhat less rosy conclusion. If 
the fund's return on investment equaled the rate of inflation 
and income was reinvested, the amounts appropriated by Congress 
for the trust fund would have a value of $148 million as of 
January 1, 1999. The value of the trust fund on January 1, 
however, was only $124.5 million. While it is true that, in 
actual dollars, the corpus of the fund has not diminished, when 
adjusted for inflation, the Resettlement Trust Fund has lost 
significant value over the years. Today, the buying power of 
the fund is 16 percent less than its value in 1988.
    One reason for the diminution in value is the distribution 
to the people of Bikini of most or all of the annual interest 
income generated by the fund, a distribution authorized by 
Congress when the fund was established. These annual 
distributions, in part, supplement USDA food assistance and 
distributions received by the people of Bikini under section 
177 of the Compact of Free Association.
    The Bikini people spend some or all of the annual income 
generated by the trust fund to support their community. Income 
not used for this purpose is added to the corpus of the fund. 
For example, the fiscal year 2000 budget for the Resettlement 
Trust Fund anticipates revenue of $9.7 million and proposes 
expenditures of $9.6 million. Thus, only one percent of the 
year 2000 revenue will be added to the fund for resettlement. 
While the annual revenue generated by the fund has been 
substantial in recent years, the amount set aside by the Bikini 
Council for resettlement has been very modest, as the year 2000 
example illustrates. With each passing year, inflation 
continues to erode the value of the fund whenever, as is often 
the case, the people of Bikini spend an amount that is greater 
than their return on investment, less inflation.
    By requesting a special distribution of up to three percent 
of the value of the trust, the people of Bikini only further 
reduce the amount available for resettlement. With this 3 
percent distribution, the current value of the fund will be 19 
percent less than the amount available in 1988. Unless Congress 
appropriates additional funds or the Bikini Council decreases 
the amount of annual income spent supporting the community, 
resettlement will be further delayed, or resettlement options 
limited, by the distribution authorized in this bill.

                          legislative history

    H.R. 2368 was introduced by Congressman Don Young and 
George Miller on June 29, 1999, and referred to the Committee 
on Resources. The bill was ordered reported on July 21, 1999, 
and passed the House under suspension of the rules on September 
13, 1999. A hearing was held by the full Committee on October 
13, 1999.
    At the business meeting on February 10, 2000, the Committee 
on Energy and Natural Resources ordered H.R. 2368 favorably 
reported, without amendment.

           committee recommendations and tabulation of votes

    The Committee on Energy and Natural Resources, in open 
business session on February 10, 2000, by a unanimous voice 
vote of a quorum present, recommends that the Senate pass H.R. 
2368 without amendment.

                      section-by-section analysis

    Section 1 provides a short title.
    Section 2 requires an ex gratia distribution of three 
percent of the market value of the Bikini Resettlement Trust 
Fund as of June 1, 1999 to the people of Bikini.

                   cost and budgetary considerations

    The following estimate of the cost of this measure has been 
provided by the Congressional Budget Office:

H.R. 2368--Bikini Resettlement and Relocation Act of 1999

    H.R. 2368 would amend the terms of the Resettlement Trust 
Fund for the People of Bikini to authorize a one-time 
distribution to the people of Bikini. The amount of the 
distribution would be limited to the greater of 3 percent of 
the fund's market value or the amount that exceeds the fund's 
principal. The federal government established the trust fund in 
1982 to assist in relocating and resettling the people of the 
Bikini Atoll, who were moved off of their islands by the United 
States to facilitate the government's testing of nuclear 
weapons during the 1940s and 1950s.
    Although the federal government has imposed restrictions on 
how monies appropriated into the Resettlement Trust Fund (which 
have already been counted as outlays) can be used, the funds 
belong to the people of Bikini and thus are nonfederal. 
Consequently, enacting the legislation would have no impact on 
the federal budget. Because the legislation would not affect 
direct spending or receipts, pay-as-you-go procedures would not 
apply. H.R. 2368 contains no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
and would have no significant impact on the budgets of state, 
local, or tribal governments.
    The CBO staff contact is John R. Righter. This estimate was 
approved by Peter H. Fontaine, Deputy Assistant Director for 
Budget Analysis.

                      regulatory impact evaluation

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out H.R. 2368. The bill is not a regulatory measure in 
the sense of imposing Government-established standards or 
significant economic responsibilities on private individuals 
and businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Little, if any, additional paperwork would result from the 
enactment of H.R. 2368, as ordered reported.

                        executive communications

    The testimony provided by the Department of the Interior at 
the Committee hearing follows:

   Statement of Ferdinand Aranza, Director of the Office of Insular 
                  Affairs, Department of the Interior

    Mr. Chairman. I am pleased to be here this morning to 
discuss H.R. 2369, which would allow a distribution from the 
Bikini Resettlement Trust Fund.
H.R. 2368--Bikini Ex Gratia Distribution
    H.R. 2368 calls for a one-time, three-percent distribution 
from the Resettlement Trust Fund for the People of Bikini.
    In 1982, the Congress established the Trust Fund pursuant 
to the terms of Public Law 97-257 for ``the relocation and 
resettlement of the Bikini people * * *, principally on Kili 
and Ejit Islands.'' In 1988, the Congress appropriated 
additional moneys for the Trust Fund and modified its terms to 
provide that funds could be also ``expended for rehabilitation 
and resettlement of Bikini Atoll.'' That same public law 
provided as well that $3 million of the Trust Fund was to be 
made available ex gratia to the people of bikini over several 
years.
    Much of the interest on the Trust Fund's $110 million 
corpus is spent annually in support of the Bikini people. 
Averaging a fourteen-percent annual return over its life, the 
Trust Fund has paid out, since its inception, million of 
dollars for infrastructure, clean-up and resettlement 
activities in Bikini Atoll; for housing and electrical power 
construction, maintenance and repairs at Kili and Ejit; and for 
scholarships, health care, and supplemental food. The 
Administration commends the elected leaders of Bikini for 
ensuring the fiscal integrity of the Trust Fund. They have 
hired reputable banks and well-respected investment advisors to 
serve as trustees and money managers. Every dollar of Trust 
Fund expenditures is audited, and financial statements and 
annual audits are routinely provided to my office, which 
oversees the Trust Fund.
    One-hundred, sixty-seven persons living in Bikini Atoll in 
1946 were removed from their islands. Of that group, those 
living today have declined to fewer than 90. The resettlement 
of Bikini is not likely to occur any time soon. The Bikinians 
cite this prospect of a delayed return as a reason for seeking 
the three-percent distribution. I am told that there is concern 
that the individuals who were actually removed from Bikini 
Atoll in 1946 are not likely to live to see the day of return 
to Bikini. The thought is that they should receive some added 
benefit before they die.
    The Administration supports enactment of H.R. 2368 and 
suggests the following clarifying amendments to improve the 
bill:
           limit the three-percent distribution 
        contemplated in the bill to Bikini persons who were 
        alive and removed from Bikini in 1946, and
           strike the last sentence of the bill, which 
        implies that the Congress may make additional ex gratia 
        payments.
    To my knowledge, no such payments are anticipated. This 
legislation should not raise expectations where there is no 
present intention to appropriate new funds.
    If requested by the Committee, we would be glad to provide 
a drafting service for these recommended amendments.
    Thank you for this opportunity to express our views.

                        changes in existing law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee notes that no 
changes in existing law are made by the Act H.R. 2368, as 
ordered reported.

                                
