By: L.N. Reklai

May 23, 2017 (Washington, D.C) President Donald Trump’s FY 2018 proposed budget, appropriates $123.9 million to fund the 2010 Compact Review Agreement with Palau. This fund is appropriated out of the $591.9 million of the Department of Interior Budget for the U.S. Territories of Guam, American Somoa, U.S. Virgin Islands, Commonwealth of the Northern Marianas, Federated States of Micronesia and the Republic of the Marshall Islands.


The source of $123.9 million according to the DOI budget report comes from Department of Defense discretionary appropriations to support the enactment of 2010 Palau Compact Review Agreement.

“While we continue to support all of our U.S. Insular areas, we have long been striving to meet our commitments to the Republic of Palau” stated acting Interior Secretary Nikolai Pula in a press release. “President Trump’s strong support for the Palau Compact shows that he recognizes the strategic importance of our U.S. territories and the Freely Associated States,” added Pula.

After the 15th year review of the Compact, as required under the terms of Agreement, both countries in 2010 agreed to a new funding agreement. The total amount was for $215 million and to extend to 2024.  The new agreement did not change the fundamental provisions of the original agreement.

Lack of funding for the Agreement has stalled its implementation due to off-set policy requirement in U.S. budget where source of funds need to be identified.  Despite this, U.S. Department of Interior has been providing approximately $13 million each year to the Republic out of its discretionary fund in lieu of the implementation of the Agreement since 2011.

The efforts to implement the agreement has garnered support over the years from both Republicans and Democrats with most recent bill introduced in the House of Representatives with aim to implement the agreement.  Source of off-set has been the contention until this appropriation from President Trump.

The bill is expected to be resisted by many supporters of Palau’s Agreement due to other issues and cuts in the overall budget.

U.S. Congresswoman Madeleine Bordallo who supports funding for Palau Compact disagrees with most of Trump’s bill, citing many of the cuts to be detrimental to the American people, particularly those that would affect the people of Guam. [/restrict]