Congressman Faleomavaega announced today that he is responding to criticisms about his handling of IRS section 936 and to a letter he received from Governor Togiola dated August 19, 2005 which was hand-delivered to his office on August 23, 2005 regarding the same subject. 

The Congressman’s letter to Governor Togiola is as follows:

Dear Governor Togiola:

I am in receipt of your letter dated August 19, 2005 which you hand-delivered to my office on August 23, 2005 regarding Mrs. Amata Radewagen and her involvement with your office. 

In your letter, you state that you “do not employ Mrs. Radewagen in any capacity.  She does not work as an ASG employee or consultant.  Any comments she may have made with regards to Section 936 or any other matter pending before Congress are her own opinions and DOES NOT represent an official position of the American Samoa Government or me as Governor.”

While I appreciate you taking the time to set the record straight, I am enclosing a Samoa News article dated March 3, 2005 entitled “Aumua Coleman appointed Governor’s Liaison to IGIA.”  The article states:

The Governor’s Office Chief Legal Counsel and director of communications, Toetasi Tuiteleleapaga said the appointment was made Feb. 24 and Deputy assistant secretary for Interior on Insular areas, Papali’itele David B. Cohen was officially informed of the appointment via letter.

In the letter, Togiola said, “Mrs. Coleman’s background and experience in Washington D.C. will be an asset to the Territory’s current efforts as part of the interagency group.”

The release further states:

Amata accompanied Togiola during this week’s IGIA meeting in Washington D.C. and the Governor asked Cohen to extend Amata “customary professional courtesy and cooperation.”

As reported by Samoa News, Tuiteleleapaga also stated:

“Amata will be handling for the Governor issues of importance to American Samoa that comes before IGIA.”

Issues on the agenda included --

“environmental infrastructure, health care and health disparities and a report by the Department of Health and Human Services, Tax Policy [meaning section 936] and the American Jobs Creations Act.”

In our February 2005 meeting in my Washington DC office, you also informed me of your intent to employ or hire Mrs. Radewagen.  Given that you then made a public announcement on March 3, 2005 that you were appointing her as your liaison, I am now taken aback as to why you have written to me stating that you “do not employ Mrs. Radewagen in any capacity.”  To employ means to use, utilize, make use of.  To hire means to employ, appoint, take on, take into service.  By this definition, Mrs. Radewagen does work for you regardless of whether or not you are paying her to represent the interests of ASG. 

As always, I support your right to employ, hire, or appoint whomever to work, consult, handle, or represent your interests in Washington, D.C., even regarding tax policy (i.e., section 936).  However, I think it is critical for you to clarify for the people of American Samoa when those working for you are officially speaking on your behalf and when they are not.  In this case, I am pleased that you are now on record stating that Mrs. Radewagen did not represent your views when she spoke before the Rotary Club in July of this year regarding section 936.  

I am also pleased that you are taking an active role in supporting H.R. 629 but I am disappointed by recent remarks attributed to you by our local papers and radio stations.  On August 31, 2005, KHJ radio reported (attached) that you discussed the outcome of your meetings in Washington, D.C. during a televised press conference and that you stated that Senator Inouye informed the local delegation that getting the tax incentives extended was “a most difficult task.”  On September 2, 2005, Samoa News also published an article (attached) entitled “Inouye calls extension of 936 tax credit a most difficult task” and attributed this statement to you. 

Let us be clear on this matter.  Contrary to your claims or the claims of our local media, Senator Inouye’s office has informed my office that he did not make such a statement to you or to our local delegation.  As you will agree, Senator Inouye has been a dear friend to our people and takes his responsibility as “Fofoga o Samoa” very seriously and I would hope that out of respect and admiration for him, he will never again be misquoted by our local media. 

As you know, our local paper and radio also reported the following about your recent visit to Washington, DC:

“According to the Governor, this was the first time he felt that federal officials fully realized the disastrous effect on the territory’s economy and well being if the tax incentives now enjoyed by the canneries are discontinued.”

Frankly, I am absolutely disappointed that you would make it sound like I have failed to bring the issue of section 936 and its effect on our economy to the attention of the federal government.  Nothing could be further from the truth and I believe you know that.  So let us be clear on this point as well.

I have been involved with IRS section 936 legislation since 1996 at a time when our possession tax was also expiring.  In fact, I worked to include American Samoa in the 1996 legislation which provided our canneries with the tax benefits they enjoy today. 

In 2001, I cosponsored H.R. 2550 to amend the Internal Revenue Code of 1986 to provide an appropriate and permanent tax structure for investments in the Commonwealth of Puerto Rico and the possessions of the United States.  Unfortunately, Congress chose not to support this legislation due to problems associated with Puerto Rico.  As an aside, I might add that former Republican Congressman Phil Crane was also a cosponsor of H.R. 2550 and was unable to get this legislation passed despite the fact that he was the Chairman of the Ways and Means Subcommittee on Trade. 

In 2003, after working to save our economy and the jobs of more than 5,000 workers during the Andean trade debate of 2002 at which time the canneries agreed to set aside section 936, I wrote to Governor Sunia on February 3, 2003 and informed him that I had met with Chicken of the Sea and Star Kist regarding the important matter of section 936.  I informed him that I had also brought this matter to the attention of the Chairman and Ranking Member of the Ways and Means Committee, the U.S. Secretary of Interior, and the Assistant Secretary for Insular Affairs. 

In my letter, I sought Governor Sunia’s support and the support of the Fono.  You were copied on this letter as was every member of the Fono.  Although the Governor’s Office never responded to my letter, I introduced H.R. 1424 on March 25, 2003 to extend or make permanent 936 tax benefits for our canneries.  

On April 7, 2003, I sent letters to Chairman Bill Thomas, Ranking Member Charles Rangel of the Ways and Means Committee, Chairman Jim McCrery and Ranking Member Michael McNulty of the Subcommittee on Select Revenue Measures, U.S. Secretary of the Interior Gale Norton, and Assistant Secretary for Insular Affairs David Cohen.  On this same day, I also wrote to you and copied every Fono member and included a copy of H.R. 1424.  On April 8, 2003, I wrote to Chicken of the Sea and StarKist.  On April 23, 2003, the Senate passed a resolution in favor of H.R. 1424. 

On May 23, 2003, I received a response from the U.S. Department of the Interior.  In July 2003, I received a response from Chairman Thomas.  In July 2003, Chairman Richard Pombo and Ranking Member Nick Rahall joined with me in sending another letter to Chairman Thomas and Ranking Member Rangel.  In September of 2003, I wrote to the Joint Committee on Taxation.  In November of 2003, I received a response from the Joint Committee on Taxation.  During November 2003, I also wrote to Chairman Thomas, Ranking Member Rangel, Senator Akaka, Senator Inouye and Senator John Breaux.

In 2004, I wrote to Chairman Charles Grassley and Ranking Member Max Baucus of the Senate Finance Committee.  I also wrote to Senators Inouye and Akaka and Republican Senators Craig Thomas, Orrin Hatch, Olympia Snowe, Gordon Smith and Democratic Senators John Breaux and Blanche Lincoln of the Senate Committee on Finance. 

In February 2005, I introduced H.R. 629, identical legislation to H.R. 1424.  On February 8, 2005, I forwarded H.R. 629 to Chairman Thomas and Ranking Member Rangel.  On February 22, 2005, the Senate passed another resolution in favor of H.R. 1424.

On March 1, 2005, I wrote to the Joint Tax Commission.  On March 7, 2005, Chicken of the Sea and StarKist sent letters of support in favor of H.R. 629.  On March 10, 2005, I met with Chairman Bill Thomas and Congressman Randy Cunningham to discuss section 936 and, in this meeting, Chairman Thomas agreed to assist American Samoa.  On March 15, 2005, I wrote a follow-up letter to Chairman Thomas. 

On April 13, 2005, I again wrote to U.S. Secretary of the Interior Gale Norton and explained the adverse effect that the loss of 936 benefits would have on our Territory.  I enclosed a copy of H.R. 629 with my letter and requested her support.  I also copied you and every member of the Fono on this letter and I provided you and every member of the Fono with the letter and a copy of H.R. 629.  On April 28, 2005, I received a response from the Department of the Interior (DOI) thanking me for my April 13, 2005 letter and stating that the Administration had not yet formulated an opinion but that the DOI remained committed to supporting productive private investment in American Samoa.  

This is only a sampling of my involvement and work with IRS section 936.  Ironically, the only letter you have written directly to me about IRS section 936 is dated August 19, 2005 which you hand-delivered to my office on August 23, 2005.  The District Governors also offered a letter of support dated August 18, 2005 which was also hand-delivered to my office on August 23, 2005. 

In your letter dated August 19, 2005, you state that it is a matter of public record that you support my efforts to seek an extension of section 936.  While I graciously accept this news, I remain perplexed as to how you can say you support my efforts when you are on record suggesting that I have never brought the issue of section 936 to the attention of federal officials.

Let me state for the record that the U.S. Department of the Interior, including Secretary Norton, Assistant Secretary Cohen, and OIA Director Nikolao Pula, are very aware of my efforts to make sure IRS 936 tax credits are extended to American Samoa.  The Senate Finance Committee and the House Committee on Ways and Means also know that I have brought American Samoa’s needs to the forefront.  These Committees are solely responsible for amending any and all federal tax legislation.

While I noted with interest that Samoa News reported that you met with officials at the Pentagon to discuss our federal tax benefits, you and I both know that the Department of Defense has absolutely no say in federal tax policy.  On the subject, Samoa News also reported that you met with Toby Burke, “the advisor to President Bush on International Affairs.”  May I state for the record that Mr. Burke is not with the Office of International Affairs.  He is with the Office of Intergovermental Affairs meaning he works with State and local governments. 

Finally, let me say that the Department of the Interior has had since 2001 to formulate an opinion about section 936 for American Samoa and has neglected to do so.  While I am hopeful that the Bush Administration will support the extension of 936 tax credits to American Samoa, Chairman Thomas and Ranking Member Rangel have given their assurances that they will work to add H.R. 629 to a larger tax package.  In other words, regardless of whether or not the Interior Department or the White House supports this provision, it will be included in a tax bill to be introduced later this year. 

Rest assured I will inform you when this larger tax package will be introduced and what the outcome is.  Until then, I am pleased that we have come to an agreement that we should put any differences aside and support what is best for American Samoa.

                            With Kindest Regards,                                   

                            ENI F.H. FALEOMAVAEGA

                            Member of Congress