June 25, 1998

FOR IMMEDIATE RELEASE

WASHINGTON, D.C. ---- FALEOMAVAEGA RESPONDS TO HOSPITAL DEBT CRITICISM; SENATE SUBCOMMITTEE CUTS $230,000 FROM OPERATIONS FUNDING

Congressman Faleomavaega announced that in a letter to the editor of the Samoa News, he has explained in detail the steps he is taking to assist the American Samoa Government resolve its difficulties with its medical creditors.

He also announced that in action taken by the Senate Appropriations Subcommittee on the Interior on June 23rd, the amount of federal funding to assist ASG with the operations of its government was cut by $230,000. CIP funding remained level at $10.1 million, with a hold on $2 million. The full committees on appropriations in both the House and Senate are voting on the appropriations bills today.

"Based on the language contained in the Senate Report to accompany the Interior appropriations bill, it is clear that the Committee remains very concerned with the operations of the American Samoa Government," said Faleomavaega. The Committee devoted more of its report to American Samoa than any other insular area, and specifically cited lack of improvements in the fiscal management of the local government and unpaid balances owed to off-island providers of medical care.

"I will work to restore the operations funding cut by the Senate Subcommittee," said Faleomavaega, "but it appears the appropriators are sending a signal to the local government that they want to see concrete evidence of improvement over the next few months in the areas of financial management, repayment of debts to Hawaii hospitals, and the management of the off-island medical referral program."

As approved by the Senate Subcommittee, the report directs the Secretary of the Interior to withhold $2 million of CIP funding for American Samoa until he certifies that ASG has implemented a repayment plan for hospital debts and has developed a plan to fund and manage off-island medical referrals. If these two steps have not been taken by June 30, 1999, the Secretary is directed to use the funds to pay the medical creditors.

"This gives our government one full year to start a repayment plan and set up a program to manage its off-island referrals," noted the Congressman. "As steps have already been taken to begin this process, I have every expectation that ASG can meet these requirements very soon, and no CIP funding will be lost." Should ASG need assistance in establishing a management program, I will work with the local government to obtain the assistance of the federal government."

"I will have more information to report as the results of the full committee action becomes available," concluded Faleomavaega.

A copy of the Congressman's letter to the editor is attached.