By: L.N. Reklai

March 23, 2017 (Koror, Palau) If no action is taken by Olbiil Era Kelulau (OEK) and the President within the next week, the Environmental Impact Fee will take effect and will be collected at the airport from arriving passengers on April 1st.

Yesterday OEK transmitted the House bill 10-22-1, HD1,SD2 to President Remengesau seeking to repeal the Environmental Impact Fee rather than delaying its implementation as initially proposed by the President.


Remengesau referred it back to Olbiil era Kelulau (OEK) last night with his recommendations for reconsideration.

President’s version (PD1) of the bill seeks only to delay EIF’s implementation and to change the name from Environmental Impact Fee (EIF) to Pristine Paradise Environmental Fee (PPEF).

Recommending against repeal, President states that EIF or now PPEF, is an integral part of the Palau National Marine Sanctuary law and that the “ultimate success of this endeavor hinges on the collection of the increased fee for travelers.”

He says that calling the fee “Palau Visitors Fee” is misleading.  “We are not charging visitors to enter Palau, but rather creating a platform for a partnership with our valued visitors that share the goal of protecting our natural environment.”

Furthermore EIF in itself is not the only source of funding for PNMS but provides a basis for “soliciting matching contributions from international partners that share the same goal of safeguarding the environment.”

Citing as an example Palau receiving over $70 million dollars worth of contributions from Nippon Foundation in the first year of the PNMS because he said, EIF or PPEF serves as critical catalyst for securing financial support from partners.

He also cited the success of the Micronesia Challenge which uses the same funding mechanism and has grown Palau’s funds to $9 million dollars. This year it was able to provide $400,000 from the interest to Palau to fund Protected Areas Network (PAN).

President states that they have also made commitments to the people in passing the Palau National Marine Sanctuary and it would be “irresponsible to go back and alter those commitments to our people.”

“We made crucial and high-level policy decision to aid the States, Civil Service Pension Plan and enforcement and surveillance of the new sanctuary ….it would be irresponsible to go back and alter those commitments to our people,” stated President Remengesau in his referral letter.

“We have wisely taken the initiative to embrace, foster and invest in quality over quantity tourism” and should “shift focus from mere head counts of visitors arrivals” to focus on providing the type of experience that high value visitors are happy to pay for.

The Senate Ways & Means Committee report on the bill recommended repealing EIF in its entirety, creating Palau Security Fund and allocating $10 dollars from what is now Green Fee to fund PNMS.  They also recommended changing the name Green Fee to Palau Visitors Fee.

The report cites current differing views on PNMS and EIF.  One is the President’s position to recommend delay to the implementation of EIF only while House position proposes to repeal EIF entirely and seek different funding source. Third viewpoint seeks to repeal the entire PNMS citing that it deprives Palau of its fishing revenues and makes Palau a very expensive tourist destination.

The Senate W&M report takes middle ground viewing EIF as a support mechanism for PNMS, funding surveillance and marine law enforcement and recommends creation of Fisheries Protection Fund with allocation of $10 from Green Fee to fund PNMS.

Senate’s minority issued a report asserting that the Palau National Marine Sanctuary law was a major economic policy decision, choosing to make tourism the “sole economic activity by which most of our local revenue will be derived”.

The minority report also claims that fees from EIF are to replace lost revenue from fishing industry that will eventually phase out based on PNMS law. Any delay or repeal is a financial decision and translates to loss of millions of dollars to the Republic, dollars meant to go to State governments and fund Civil Service Pension Plan.

Any delay or repeal of the EIF is a financial decision according to the minority report and should include a “Poison Pill” provision to repeal the PNMS.

A separate position statement from Senator Uduch Sengebau-Senior to Senator Rudimch, Chairman on Committee on Ways & Means, recommended entire PNMS be repealed and Palau returned to the fishing industry as source of revenue citing declining revenues from the tourism industry.

President Remengesau in his earlier statement on the EIF said “ it is a crucial component of the Palau National Marine Sanctuary (PNMS) – fundamental to its structure, plans, and strategy, and implementation stages leading up the full effect of the PNMS in 2020.”

“Simply put, the EIF is not meant as an additional or supplemental source of revenue, but is meant to be a financing method from which we collect the principal funds to restructure our economic base and collect the necessary funding to safeguard our natural resources and strengthen our economic base. That base is tourism.  And tourism relies on Palau’s marine and terrestrial environment to be protected and preserved in the utmost capable manner.”

“Fisheries no longer represent a viable and sustainable source of revenue for our economy.  Investments in fisheries are now being pushed toward protecting dwindling ocean resources rather than expanding operations. The pacific fish stock is declining and before Palau’s waters reach critically low levels, we must take action to protect our nation’s future,” stated President Remengesau in his letter to OEK not to repeal but delay the implementation of the EIF or Pristine Paradise Environmental Fee (PPEF). [/restrict]