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[OEK Acts on Fiber Optic Cable and FY2016]
The OEK in one session day passed two major pieces of legislations with the approval of the milestone Belau Submarine Cable Corporation and the Fiscal Year 2016 budget.
The chances for Palau to acquire an undersea fiber optic cable bring us closer to reality following the Olbiil Era Kelulau’s approval of the bill to establish the Belau Submarine Cable Corporation (BSCC) on September 15, President Remengesau is expected to sign the bill early next week.
The bill, HB No. 9-163-16S, HD3, SD3, CD1, cleared OEK after one of the biggest policy battles of the Ninth Constitutional Government with the bill’s senate opposition putting up a spirited fight until the end.
The bill establishes a statement owned corporation, known as Belau Submarine Cable Corporation, to procure and manage the fiber optic cable.
After the Senate approved their version of the BSCC on Sep 10, it was quickly rejected by the house the next day, on Sep 11, setting up a conference committee with members of both houses to find a compromise.
The first conferees’ discussion failed to produce an agreed version, which led to another conference session but with new conferee members.
“On September 14, 2015, the Conference Committee began discussion but failed to reach an agreement. On September 15, the Senate appointed new members to the Conference Committee and that same day your Conference Committee obtained consensus on this important legislation,” said the bill’s conference committee report.
At issue were the differing views on the corporation designated with the authority to procure, own, and manage a fiber optic cable and telecommunications services in Palau.
“The House of Delegates version creates a new corporation known as Belau Submarine Cable Corporation (BSCC) and BSCC Board of Directors that is endowed with the authority to undertake all actions necessary to facilitate, promote, and manage the fiber optic cable procurement and high speed, broadband internet services for the Republic. The Senate version, on the other hand, empowers an existing corporation, Palau National Communications Corporation to procure own, and manage the fiber optic cable and oversee telecommunications services. In addition to these duties, however, PNCC would also be required to cooperate with the national government to acquire a fiber optic cable by seeking out sources of funding to pay for the venture. These measures were added because the pre-existing negotiations between the Republic and ADB are put in jeopardy by PNCC management of the fiber optic cable. Therefore, the national government would have to solicit outside loan, grant, or other aid to seek new funding for the cable,” said the conferee’s report.
Financing through the Asian Development Bank is contingent upon a wholly separate entity other than PNCC for fiber optic cable and internet service provision management. “[I]n order to take advantage of the ADB loan agreement, BSCC or a similarly structured corporation must be created to manage the fiber optic cable. Your Conference Committee has discussed this reality and jointly agrees that the language proposed by the House of Delegates creating the separate corporation called BSCC should be adopted,” said the conferee’s report.
However, the final version agreed with the Senate in appropriating $410,000 in fiscal year 2015 to secure Republic’s interest in a fiber optic.
The bill was quickly passed on the same day the conference report came out.
In a dramatic shift, Senator Baules joined forces with the minority-bloc members forming the Senate conferees. Signing the report of the Senate was Baules as chair of the Senate conferees with Sen. Senior as vice chair, and members Oilouch, Inabo, M. Whipps, Surangel Jr., and Reklai.
House members signing the committee report are Mario Gulibert as chairman, Masasinge Arurang as vice chair, members Otobed, Basilius, Ngiraiwet, Kemesong, Ngemaes, Gibbons, and Madrangchar.
Fiscal Year 2016 Budget.
The House and the Senate on September 15 both gave their approval for the FY2016 budget law that authorizes $84.9 million and appropriates $84.5 million for the annual operations, special revenue, and debt service of the national government.
Both houses agreed to President Remengesau’s version – HB No. 9-191-11, HD6, SD3, PD1 – when he referred the bill back to OEK to consider his recommendations.
Key concerns the President raised in the referral of the budget was reduced funding for other agencies, policy initiatives imposed in the budget, and technical corrections that need to be made.
“[A] number of key agency and programs budgets require further considerations as reduced funding will affect their capacity to effectively provide the services required of them. At the same time, several policy initiatives imposed in the budget will likely not produce the desired outcomes but rather adversely affect our financial capacity. In addition, technical corrections are needed to ensure that agreed policy initiatives and budgeted activities have the budget authority to operate,” the President said in his referral letter.
Remengesau restored cuts made to Bureau of Customs, Revenue and Taxation, Bureau of Foreign Affairs and Technical Assistance. Also with funding restored are Office of the Special Prosecutor, Office of the Public Auditor, and the National Postal System.
Belau National Museum and Palau National Red Cross had their budget restored.
Tia Belau News. Sep 17, 2015.
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Fiber Optic Cable bill to become law
WRITTEN BY ADMINISTRATOR
THURSDAY, 17 SEPTEMBER 2015 23:04
President Remengesau to sign it on Monday
In a public comment today, President Remengesau Jr., expressed that he will be signing the bill creating a Belau Submarine Cable Corporation into law on Monday September 21, 2015. He expressed his gratitude to all that worked toward making this very important bill become a reality.
Belau Submarine Cable Corporation bill took center stage in the political arena for the past eight months with majority bloc of the Senate, and EPUI Committee chaired by Senator Toribiong holding on to the bill, citing a need for further study.
The bill became a topic of public debate on various forums, from coffee shops, to social media, to radio talk shows and to public conferences, with majority of the people showing support for the bill.
Timing and funding were two major factors inciting the debate. Timing due to the funding agency’s (Asian Development Bank) loan timetable, which is set for review and approval in December and the SEA-US Cable project’s commitment timeline, which was extended to the end of this month, September 30.
SEA-US Cable, a consortium of telecom companies laying a state-of-the-art submarine fiber optic cable to Guam from Indonesia and passing close to Palau, has offered an opportunity to Palau to join it but gave Palau a deadline to commit to the project.“Funding through ADB is contingent upon fiber optic cable and internet service provision management… be by a wholly separate entity and not PNCC”, according to the Conference Committee Report.
Senate passed on September 9, their version of the House bill 9-163-16S, HD3, SD3, CD1, which deleted the Belau Submarine Cable Corporation as the authority to own and manage the fiber cable project and transferred the authority to Palau National Telecommunications Corporation (PNCC).
It went beyond fiber optic to expand the role of PNCC to permit and regulate all other telecom providers in Palau. House rejected the Senate’s version and bill went to a Conference Committee, made up of the Senate EPUI Committee members, Senator Joel Toribiong, Senator Mark Rudimch, Senator Mlib Tmetuch, Senator Phillip Reklai and Senator Mason Whipps and House Committee of the Whole which included all members of the House.
The Report from this Conference Committee retained the Senate version and the members that signed the report included Senators Joel Toribiong, Mark Rudimch, and Mlib Tmetuchl. Senator Phillip Reklai signed with reservations and Senator Mason Whipps did not sign.
House members of the Committee all did not sign except for Delegate Mario Gulibert. With this, the report was not adopted and was referred back to both Houses.
During Senate Session on September 15th to discuss the bill, Senator Surangel Whipps Jr., made a motion to create a new committee to deal with the matter since the first committee failed.
The committee was made up of Senators Rukebai Inabo, Raynold Oilouch, Phillip Reklai, Uduch Sengebau Senior, Mason Whipps, Surangel Whipps Jr. and was chaired by Senator Hokkons Baules.
The new Senate Committee joined the House Committee of the Whole and they approved the original version of the bill, reinstating BSCC as the authority to own, manage and procure fiber optic cable to Palau.
The new draft also reinstated other important parts of the bill including having the Minister of Finance as the initial incorporator of this corporation.
This means that the work on the financing and contracting can begin immediately while new board members are still going through the appointment and approval process so that the project timetables can be met.
Also restored is the language that states that this will not be issuing stocksbut “provided that that in 10 years the government may consider privatizing this corporation or establishing a public-private partnership.”
The bill added appropriation of $410,000 to secure Palau’s interest in the fiber optic submarine cable. This would enable Palau to secure its interest on the SEA-US Cable project.
This new Conference Committee version of SB 9-163 was signed by all the members of the committee of both Houses.
After heated contest in the Senate by original Committee members, Senator Hokkons Baules, Senator Rukebai Inabo, Senator Uduch Sengebau Senior, Senate President Camsek Chin, Senator Mason Whipps, Senator Phillip Reklai and Senator Surangel Whipps Jr. adopted the Conference Committee Report and voted to accept the bill.
The bill is set to become law on September 21, 2015 upon signing by President Tommy Remengesau Jr.