Journal Staff

Guam’s delegate to Congress Michael F.Q. San Nicolas on Jan. 6 gave his first delegate’s annual speech before the 35th Guam Legislature. During the speech, he touched on a variety of topics, focusing on economic development for Guam and the region, veterans’ services, expanding services for Compact of Free Association migrants, war reparations, expanding representation for the territories in Congress and his attempts to gain greater influence in Congress to more effectively represent Guam.

San Nicolas started his speech by describing his efforts to more aggressively seek positions of influence in Congress, saying that too often Guam has accepted the idea that it has no real voice in Washington D.C. and resigned itself to a “sad fatalism.” To change this, San Nicolas said one of his first goals was to identify the highest position he could realistically attain in the highest committee he could realistically attain, which resulted in him being appointed by Rep. Maxine M. Waters vice chairman of the U.S. House Committee on Financial Services. He’s the first representative from a territory to hold such a position in what San Nicolas called an “A-list committee.”

In his discussion on economic development, San Nicolas emphasized three topics: the establishment of an Office of Territorial Export within the U.S. Export-Import Bank, tax repatriation and the establishment of a free trade agreement in the Pacific region called the Pacific Allies Free Trade Agreement.

According to San Nicolas, the establishment of the Office of Territorial Export — which, according to an Oct. 30 release from San Nicolas’ office, created “a dedicated office in the bank to facilitate territory access to a pool of up to $175 million annually to finance and guarantee export-oriented businesses” — opens Guam up to greater transshipment opportunities, which he said will bolster its shipping related industries and add jobs. He also said transshipment will lower prices by mitigating the impact of the Jones Act, which — although many in Guam have voiced support for its repeal due to its effect on the island’s economy — is difficult to repeal because of the vested interests of various states.

Tax repatriation is also a potentially significant source of revenue, according to San Nicolas.

“If we can get this local law properly implemented and marketed, the benefit to our government coffers are so significant it seems almost impossible to believe,” he said. “Over $3 trillion is sitting overseas and represents the vast repatriation opportunity available. If just one company were to repatriate $10 billion, they would pay at a 37% tax rate $3.7 billion in taxes. Our incentive rebates 90% of this, or $3.33 billion saved in taxes by the company, with Guam retaining $370 million in tax revenue.”

The Pacific Allies Free Trade Agreement — which San Nicolas said will be unveiled in the coming year — is an attempt to create an agreement specific to the relationship between the U.S. and the Asia Pacific region, which will impact trade, labor, healthcare and business regulations.

San Nicolas said the PAFTA arose out of attempts to expand the language of the National Defense Authorization Act to allow more H-2B workers to work on civilian projects on Guam. According to San Nicolas, he was told expanding the language was a political non-starter because it would affect H-2B visas across the nation. The PAFTA is an attempt to address issues specific to the Asia Pacific region separately without impacting national hot-button issues such as immigration.

“We can even free up the flow of bananas from Pohnpei so we don’t need to import them from Mexico,” he said. “Sometimes the best way to get what we want isn’t to ask for an exception to the rule, but to craft a rule that is the exception.”

San Nicolas also gave detailed accounts of his efforts towards expanding education and healthcare services for Compact of Free Association migrants, to increase veterans’ services so that Guam and other territories in the region have a ratio of veterans to available resources comparable to the rest of the U.S., and his efforts to pass a bipartisan bill to correct technical language in the Guam World War II Loyalty Recognition Act that prevented war claims from being paid out. According to the website, the bill — H.R. 1365 — passed the House of Representatives and was received in the Senate in July, where it has since been referred to the Committee on the Judiciary.

Referencing an attempt by the Leon Guerrero administration to pay war reparations out of local funds and then seek reimbursement from the federal government, San Nicolas said the plan was politically unfeasible because of the precedent it would set for other districts, which he said would then seek federal reimbursement for the use of their own local funds. A better use of the $14 million in local funds proposed for war reparations, according to San Nicolas, would be to survey Chamorro Land Trust lands, which he said would then free up land and increase housing inventories, lowering the price of housing and addressing an issue that has been stalled for several years.

“This can be the year we both get war claims paid and distribute Chamorro Land Trust lands,” he said.

The office of the governor of Guam issued a response, which addressed war reparations, Medicaid and tensions with Iran.

Regarding war reparations, the governor’s office said, “The federal reassignment of claims process is already part of federal law. That is the process by which we will be repaid. Whatever influence Guam may have in Washington D.C., we hope it will be used to help this process, not hurt it. No one should pit Chamorro Land Trust recipients against the manåmko’. We are all better than that.”

The governor’s statement also said that her office had hoped for and did not receive from San Nicolas’ speech an update on how tensions with Iran might affect Guam, as well as a plan to expand and improve Medicaid coverage for the islands. mbj