Congressman Faleomavaega is pleased to announce that
after months of negotiation terms of the $18.6 million tobacco loan legislation
have been finalized.
“This is good news for the people of American Samoa,” Faleomavaega
said. “Terms of the loan include a 5.4% fixed interest rate and a
more favorable re-payment plan for ASG.”
Terms of the loan agreement were complicated when the U.S. Department
of Interior (DOI) and the U.S. Department of Treasury disagreed on what
the interest rate should be and when re-payment should begin.
DOI held that the interest rate should be fixed at 5.4% as Congress
intended. Treasury rejected the terms and insisted that American Samoa
should pay the current market rate at the time of signing.
“A higher interest rate would have cost American Samoa hundreds
of thousands of dollars in the future,” Faleomavaega said. “Clearly, this
was not what Congress intended when it enacted its initial plan of fiscal
and managerial reform.”
The U.S. Treasury also wanted ASG to begin re-paying the interest
in two years. “Since the sole purpose of the $18.6 million loan is to assist
ASG in paying off its current debts, I felt it was premature on the part
of the U.S. Treasury to insist that re-payments begin immediately,” Faleomavaega
explained. “To resolve the matter, we turned to the U.S. Office of
Management and Budget (OMB).”
OMB is an executive office within the White House that controls
the administration of the Federal budget and coordinates management procedures
and program objectives among Federal departments. When one Federal
agency disagrees with another on implementing or defining policy, OMB routinely
addresses and resolves those disputes.
“I really want to thank Senator Inouye for personally bringing this
matter to
the attention of Jack Lew, Director of OMB,” Faleomavaega said.
“OMB’s assistance in this matter was critical.”
“I also want to thank Jeffrey Farrow, Co-Chair of the President’s
Interagency Group on Insular Areas, members of the Hawaii delegation and
Governor Tauese for their unwavering support and commitment to the process.
We have all worked hard to see this matter through and now it is time for
us to move forward and secure our economic future,” Faleomavaega concluded. |
![[106th Congress]](/faleomavaega/press/press_2000/images/106.jpg)
