FY 2006 Annual National Budget Act, RPPL 7-13 2005

	Home \| Databases \| WorldLII \| Search \| Feedback Palau Sessional Legislation

SEVENTH OLBIIL ERA KELULAU RPPL NO. 7-13
(Intro. as H. B. No. 7-58-3, HD10, SD2,
CD1,PD1)
Third Regular Session, July 2005

To authorize for appropriation the sum of ~~$60,065,679~~ $55,569,179 and to authorize and appropriate the sum of ~~$56,315,679~~ $59,569,179 from the National Treasury for the annual general operating, special revenue and debt service budget of the Republic of Palau for the fiscal year ending September 30, 2006; and to amend and repeal the following: amend 33 PNC '702(a); amend Section 4 of RPPL No. 6-43 as codified in 33 PNC '702(c)(1); amend Section 57 of RPPL No. 5-7, as codified in 34 PNC '331; amend Section 8 of RPPL No. 1-49, as codified in 28 PNC '508; amend Section 8(b) of RPPL No. 2-5, as codified in 22 PNC '227; amend Section 306 of RPPL No. l-63, as codified in 40 PNC '1206; amend Section 204 of RPPL No. 1-63, as amended by RPPL No. 4-36, Section 6, as codified in 40 PNC '1104; repeal Section 21 of RPPL No. 6-26, as codified in 27 PNC '103; amend Section 3 of RPPL No. 6-32, as codified in 30 PNC '164; amend Section 15 of RPPL No. 6-26; amend 11 PNC 1042(c) as amended by RPPL No. 5-9, Section 1(b); amend Section 351 of Title 40, as amended by RPPL No. 7-7, Section 23; and for related purposes.

THE PEOPLE OF PALAU REPRESENTED IN THE OLBIIL ERA KELULAU DO ENACT AS FOLLOWS:

Section 1. Short Title. This Act may be cited as "The Fiscal Year 2006 Annual National Budget Authorization and Appropriation Act."

$31,509,500
Section 2. Executive Branch Operations. The sum of $31,529,500 hereby authorized to be appropriated and is appropriated for expenditure and obligation for fiscal year 2006 for the purpose of covering the operational and contingent expenses of the Executive Branch. The total amount authorized to be appropriated and appropriated shall be made up of the following available $19,792,500 revenues: The amount of $19,812,500 shall come from local revenues; the amount of $4,000,000 shall come from Compact Section 211(a) funds; the amount of $3,840,000 shall come from the Compact Section 215 Inflation Adjustment fund derived from Compact Section 211(a); the amount of $150,000 shall come from Compact Section 211(c) funds and shall be applied to subsection(4)(1); the amount of $96,000 shall come from the Compact Section 215 Inflation Adjustment funds derived from the inflation adjustment of Compact Section 211(c) and shall be applied to subsection (7)(c); the amount of $631,000 shall come from Compact Section 211(d) funds and shall be applied to subsection (8)(d); and the amount of $3,000,000 shall come from Compact Section 211(f) Trust Fund Investment Earnings. The total authorization and the total appropriation shall be allocated according to the following schedule, respectively:

The Minister of Health and the Minister of State will coordinate and undertake a study to be reported to the Olbiil Era Kelulau within 120 days from the effective date of this Act, to address the following: (i)Desirability and feasibility of merging the Manila Medical Referral Office and ROP Embassy in Manila for the purpose of realizing gains in efficiency and effectiveness of function and responsibilities, and for other related matters; and

All funds for implementation of recommendations shall be appropriated pursuant to law.

The amount of $10,000 shall be used to defray cost of facility renovations, improvements and related equipment as appropriate.

Of this sum, not less than $30,000 shall be used for programs dedicated to senior citizens of each state, excluding Koror, Airai, Sonsorol and Hatohobei. The Director of the Aging Program shall, within 120 days, promulgate regulations, subject to Administrative Procedure Act, 6 PNC Chapter 1, to cover eligibility of senior citizens for feeding programs.

As soon as practicable and before August 2006, the Minister of Education shall establish regulations, pursuant to the Administrative Procedure Act, 6 PNC Chapter 1, to implement the Food Service Program Study requiring subsidy payments from parents. Subsidy payments shall be required to continue the Food Service Program. However, subsidy payments by parents must be fair and equitable.

The Minister of Education shall establish a Little League and Senior Little League pilot project based on Little League Rule Book with respective elementary schools and high schools in Koror State.

Programs shall run between the months of January to May, between the hours of 3:30 pm to 4:30 pm, Monday to Friday.

The Minister of Health and the Minister of State shall coordinate and undertake a study, to be reported to the Olbiil Era Kelulau, within 120 days from the effective date of this Act, to address the following:

(i) Desirability and feasability of merging the Manila Medical Referral Office and ROP Embassy in Manila for the purpose of realizing gains in efficiency and effectiveness of function and responsibilities, and for other related matters; and

All funds for implementation of recommendations shall be appropriated pursuant to law.

(i) The Minister of Health shall undertake a study and report to the Olbiil Era Kelulau, within 120 days from the effective date of this Act, the most efficient and effective ways to provide for the needs of the medical referral program in Honolulu, Hawaii, including, but not limited to, the following:

(3) Development of new facility or renovation of existing facility to provide for the needs of patients and escorts, and

All funds for implementation of recommendations shall be appropriated pursuant to law.

The Bureau of Marine Resources shall assume the responsibilities and authority of the Bureau of Oceanic Fishery Management.

The CIP Office is prohibited from tapping into the 10% of all National and State Government Capital Improvement Projects that have funds appropriated from the Olbiil Era Kelulau from local revenues. The CIP Office shall, within 30 days, of the awarding of any grant, report to the OEK's Committees on Ways, Means & Financial Matters, a full financial report which details the total grant award, the administrative budget detailing costs and expenditures and all disbursements of funds, and funds from the 10% allocated to administrative costs for each grant.

The amount of $10,000, or so much thereof as necessary, shall be used to purchase a motor vehicle.

(1) Of this amount, $50,000 or so much thereof as necessary, shall be used to defray the cost of electrical utilities for State Water Plant Systems.

shall be used to defray the cost of the Ollei water tank repairs in Ngarchelong State; and $20,000, or so much thereof as necessary, shall be used to defray the cost of the Shimizu waterline expansion in Ngchesar State.

The Minister shall use this amount, or so much thereof as necessary, to defray the cost of repairing the potholes in the primary highway used in Koror and Airai. This funding shall only be used for equipment and supplies related to the pothole repairs. The Minister shall utilize the personnel services and property of Public Works and the National Government to repair the potholes in the Koror and Airai highway.

Section 3. Boards, Commissions, and Authorities. The sum of $651,000 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 for the purpose of covering the operational and contingent expenses of Boards, Commissions and Authorities. The entire amount of funds authorized to be appropriated and is appropriated shall come from local revenues. The total authorization and the total appropriation shall be allocated according to the following schedule, respectively:

Section 4. Judicial Branch. The sum of $2,276,000 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 for the purpose of covering the operational and contingent expenses of the Judicial Branch. The total amount authorized to be appropriated and appropriated shall be made up of the following available revenues: The amount of $1,276,000 shall come from local revenues; and the amount of $1,000,000 shall come from Compact Section 211(f) Trust Fund Investment Earnings. The total authorization and total appropriation shall be allocated according to the following schedule, respectively:

Section 5. Legislative Branch. The sum of $3,772,500 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 for the purpose of covering the operational and contingent expenses of the Legislative Branch. The total amount authorized to be appropriated and appropriated shall be made up of the following available revenues:

The amount of $2,772,500 shall come from local revenues; and the amount of $1,000,000 shall come from Compact Section 211(f) Trust Fund Investment Earnings. The total authorization and appropriation shall be allocated according to the following schedule:

The Olbiil Era Kelulau may obtain funding from any source, including, but not limited to grants and contributions. The $100,000 funding is only authorized for appropriation until such time that the current GAO law is amended so that the GAO shall not prosecute illegal activities. The amendment to law shall be enacted by January 2006. Once the GAO law is amended and enacted into law, the $100,000 is authorized and appropriated for expenditure.

Section 6. State Block Grants. The sum of $4,987,500 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 for the purpose of State Governments operations and capital improvement projects expenses. The amount of $2,000,000 is authorized to be appropriated for fiscal year 2006 for capital improvement projects. The Minister of Finance with the assistance of the Director of the Bureau of National Treasury, within 30 days of the effective date of this Act, shall establish a method of disbursement, whether by monthly or quarterly installments or by lump sum to each respective state, which shall be uniform for all sixteen State Governments so all States shall receive their funds in fair, equitable and timely manner. The entire amount of funds authorized to be appropriated and is appropriated shall come from local revenues. The amount authorized for appropriation shall be available for expenditure for operations and CIP projects in accordance with 40 PNC Chapter 22. The total authorization and total appropriation shall be allocated according to the following schedule, respectively:

Section 7. Independent Agencies. The sum of $2,345,000 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 as operating grants or subsidies for independent agencies of the National Government. The total amount authorized to be appropriated and appropriated shall be made up of the following available revenues: The amount of $1,345,000 shall come from local revenues; and the amount of $1,000,000 shall come from Compact Section 211(a). The total authorization and appropriation shall be allocated according to the following schedule, respectively:

Of this sum, the amount of $75,000 shall be used for CIP - Philatelic Sales Building and for the purchase of air-conditioning units and other equipment and furnishings.

Of this sum, the amount of $25,000, or so much thereof as necessary, shall be used to defray the cost of holding the annual Olchotel Belau Fair. Beginning Fiscal Year 2006, Palau Visitors Authority shall shift

their responsibilities from mere promotion to tourism development of the Republic, including but not limited to the development of local resources in hosting, local network of services, training locals in tourism services, regulating tourism businesses, etc.,

The amount of $7,000, or so much thereof as necessary, shall be used to purchase a motor vehicle and $13,000, or so much thereof as necessary, to defray the cost of transferring the security screening employees. The Minister of Commerce and Trade, or the proper authoritative body, shall provide to the National Aviation Administration office space at the New or Old Airport Terminal Building.

Section 8. Other Agencies and Activities. The sum of $1,929,000 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 as grants or subsidies for recurring programs and activities. The total amount authorized to be appropriated and appropriated shall be made up of the following available revenues: the amount of $929,000 shall come from local revenues; and the amount of $1,000,000 shall come from Compact Section 211(a) funds. The total authorization and appropriation shall be allocated according to the following schedule, respectively:

Of this sum, the amount of $50,000, or so much thereof as necessary, shall be used to defray the cost of Hosting the Fall 2005 Meeting of the U.S. Coral Reef Task Force and the Co-Secretariat responsibilities of the International Coral Reef Initiative (ICRI) with the Government of Japan.

Of this sum, the amount of $150,000, or so much thereof as necessary, shall be used to defray the cost of Team Palau in the 2006 Micronesian Games and the amount of $6,000, or so much thereof as necessary, shall be used to defray the cost of participation in the North Pacific Qualifying Tournament.

(12) Hosting of the Conference of the Pacific Island Community and the 35th meeting of the Committee of Governments and Administrations 70,000

Section 9. Education Assistance. The sum of $4,301,179 is hereby authorized to be appropriated and is appropriated for expenditure or obligation for fiscal year 2006 to subsidize the educational institutions and scholarship program set forth below. The total amount authorized to be appropriated and appropriated shall be made up of the following available revenues: The amount of $2,301,179 shall come from local revenues; and the amount of $2,000,000 shall come from Compact Section Education Block Grant 221(b)(1) funds and shall be applied to subsection (1). The total authorization and appropriation shall be allocated according to the following schedule, respectively:

the cost of renovating and improving the school facilities and other facilities, including the kitchen and for purchasing computer equipment.

(k) The Ministry of Finance shall disburse the above funds to all Non-Public Schools for nonreligious purposes in a fair, equitable manner and method. The Minister of Finance, with the assistance of the Director of National Treasury shall, within 30 days of the effective date of this Act, determine the disbursement method whether by monthly, quarterly installments or in lump sum at the beginning of each fiscal year.

The method of disbursement shall be made uniform for all parochial schools so all schools shall receive their funds for nonreligious purposes in a fair, equitable and timely manner.

Section 10. Hospital Trust Fund. The amount of $1,433,000 or the actual amount collected is hereby authorized to be appropriated and is appropriated for fiscal year 2006 for purposes of the Hospital Trust Fund. The amount authorized to be appropriated and appropriated shall come from revenues derived from clinical and public health medical and dental services fees and charges during the fiscal year, provided that the actual expenditures or obligations shall not exceed actual revenue receipts. Any unexpended or unobligated balance of the appropriation of this section shall not lapse at the end of the fiscal year.

Section 11. Debt Service. The sum of $1,891,000 plus any sum necessary for related banking fees and interest charges is hereby authorized to be appropriated and is appropriated for fiscal year 2006 for the purpose of payment of periodic interest and principal payments pursuant to the promissary notes under the $20 million International Commercial Bank of China ("ICBC") (Taiwan) loan agreement for the purpose of completion of Phase II of the national capitol construction project in Melekeok State; and the $15,000,000 million ICBC loan agreement for the purpose of resurfacing the runway including improvements to relevant facilities of the Palau International Airport. The amount authorized to be appropriated and is appropriated shall come from local revenues. Any unexpended or unobligated balance of the appropriation of this section shall not lapse at the end of the fiscal year.

Section 12. Public Service System Reclassification. The sum of $450,000 is hereby authorized to be appropriated for expenditure or obligation for fiscal year 2006, beginning January l, 2006, for the purpose of implementing the Public Service System Reclassification as recommended through the review of government wages and salaries pursuant to RPPL No. 6-12 (26). The sum of $450,000 is hereby appropriated for expenditure after December 31, 2005, and after an amendment to the Annual Base Salary Scale of Title 33 of the Palau National Code, with respect to the base salary schedule for National Government employees, is enacted into law. The entire amount authorized to be appropriated and is appropriated shall come from local revenues.

Section 13. Prior Year Accounts Payable. Not more than $500,000 from fiscal year 2006 revenue earnings may be used to retire prior year accounts payable. The Minister of Finance shall provide to the OEK within 15 days after the effective date of this Act, a listing of all prior year accounts payable, including those scheduled to be retired in Fiscal Year 2006.

Section 14. Rental Payments to Koror State. There is hereby authorized to be appropriated and is appropriated for fiscal year 2006 the amount of funds necessary for purposes of monthly payments to Koror State for the rent of housing units in accordance with paragraph 18 of the Land Settlement Agreement executed February 3, 1997, to the extent that a like or greater amount is first collected from the Koror State Government for amounts owed to the National Government pursuant to provisions of law that require remittance to the National Treasury of 25% of all revenues derived from leases of public land in Koror; appropriate offsets of the revenues collected and payments made under this section are to be recorded in a separately identified budgetary account.

Section 15. Apportionment and Allotment. Unless otherwise stated in this Act, amounts appropriated in this Act shall be apportioned and allotted at the direction of the President.

Section 16. Presidential Reprogramming.
(a) The sums appropriated under Section 2 of this Act may be reprogrammed by the President in accordance with RPPL No. 6-11.

(b) Amendment. Section 351 of Title 40 of the Palau National Code, as amended by RPPL 7-7, Section 23, is hereby amended to read as follows:

(a) The President may reprogram appropriated funds, having due regard for the effective reprogramming on the performance of affected budget activities, as follows: (1) Up to 10 percent of appropriated funds from any general operations appropriation item in a fiscal year may be reprogrammed out to any other budget activity, except as otherwise provided by law. No budget activity appropriations may be increased by reprogramming by more than 15 percent of its original appropriations except as otherwise provided by law.

Section 17. Amendment. Base Salary Schedule, 33 PNC '702(a) is hereby amended and as amended in section 702(a) and new subsection (a)(1) to read as follows:

(a) The base salary schedule appearing in the table below provides the official annual salary rates which shall be paid to all civil service and contract employees of the National Government unless otherwise specifically established by law. Hourly rates shall be calculated by dividing the applicable annual salary level and dividing by two thousand eighty (being forty hours per week for fifty two weeks in a year) and rounded to the nearest tenth of a dollar.

Grade	1		2		3	4	5	6	7	8	9	10	11	12	13	14
1	5,980		6,159		6,344	6,535	6,731	7,000	7,280	7,571	7,874	8,267	8,681	9,115	9,571	10,145
2	6,279		6,467		6,661	6,861	7,067	7,350	7,644	7,949	8,267	8,681	9,115	9,571	10,049	10,652
3	6,593		6,791		6,995	7,204	7,420	7,717	8,026	8,347	8,681	9,115	9,571	10,049	10,552	11,185
4	6,922	7,130		7,344		7,564	7,791	8,102	8,426	8,764	9,114	9,570	10,048	10,551	11,078	11,743
5	7,268	7,486		7,711		7,942	8,180	8,507	8,848	9,202	9,570	10,048	10,551	11,078	11,632	12,330
6	7,632	7,861		8,097		8,340	8,590	8,933	9,291	9,662	10,049	10,551	11,079	11,633	12,215	12,947
7	8,013	8,253		8,501		8,756	9,019	9,379	9,755	10,145	10,551	11,078	11,632	12,214	12,824	13,594
8	9,015	9,285		9,564		9;851	10,146	10,552	10,974	11,413	11,870	12,463	13,087	13,741	14,428	15,294
9	10,141	10,445		10,759		11,081	11,414	11,870	12,345	12,839	13,353	14,020	14,721	15,457	16,230	17,204
10	11,409	11,751		12,104		12,467	12,841	13,355	13,889	14,444	15,022	15,773	16,562	17,390	18,259	19,355
11	12,835	13,220		13,617		14,025	14,446	15,024	15,625	16,250	16,900	17,745	18,632	19,563	20,542	21,774
12	14,440	14,873		15,319		15,779	16,252	16,902	17,579	18,282	19,013	19,964	20,962	22,010	23,110	24,497
13	16,245	16,732		17,234		17,751	18,284	19,015	19,776	20,567	21,390	22,459	23,582	24,761	25,999	27,559
14	18,519	19,075		19,647		20,236	20,843	21,677	22,544	23,446	24,384	25,603	26,883	28,227	29,639	31,417
15	21,852	22,508		23,183		23,878	24,595	25,578	26,602	27,666	28,772	30,211	31,721	33,307	34,973	37,071
16	25,786	26,560		27,356		28,177	29,022	30,183	31,391	32,646	33,952	35,650	37,432	39,304	41,269	43,745
17	30,427	31,340		32,280		33,248	34,246	35,616	37,040	38,522	40,063	42,066	44,169	46,378	48,697	51,618
18	36,512	37,608		38,736		39,898	41,095	42,739	44,448	46,226	48,075	50,479	53,003	55,653	58,436	61,942

(a)(1) Transition to this new salary schedule shall take effect on January 1, 2006 and shall continue until all civil service employees and contract employees are transferred accordingly into this salary schedule. All regular civil service employees and contract employees shall be placed in this salary schedule in accordance with the classification guideline and procedures to be established by the Bureau of Public Service System and approved by the President. Once all civil service and contract employees are transferred into this salary schedule, then Section 703 and 704 and its applicable subsections will automatically be suspended."

Section 18. Amendment. Base Salary Schedule, 33 PNC ' 702(c)(1), as amended by RPPL No. 5-22 and RPPL No. 6-26 and Section 4 of RPPL No.6-43, is further amended to read as follows:

(a) The base salary schedule appearing in the table below provides the official hourly base and annual salary rates which shall be paid to all employees of the National Government unless otherwise specifically established by law: National Public Service System employees shall be paid within the wages provided by grades 1 through 18, in accordance with the respective pay levels assigned to their positions by the appropriate legal authority.....

(A) Contract employees not covered under the eligibility designations and restrictions provided in subparagraph (2) or as otherwise provided herein shall be paid according to grades 1 through 18 of the Base Wage and Salary Schedule provided in subsection (a) of this Section.

(B) EPS1, steps 1 through 10: Other Judicial Branch professionals, as determined by the Chief Justice.

(C) Associate Judges of the Court of Common Pleas shall receive an annual salary of $55,000, if he or she is an attorney, and $25,000 if he or she is not, as determined by the Chief Justice. The Senior Judge of the Court of Common Pleas shall receive an annual salary of $60,000 if he or she is an attorney, and $28,000 if he or she is not an attorney, as determined by the Chief Justice. Full Time Associate Judges of the Land Court shall receive an annual salary of $60,000 if he or she is an attorney, and shall receive an annual salary between $30,000 and $45,000, as determined by the Chief Justice, if he or she is not an attorney. Part-Time Associate Judges of the Land Court. The Senior Land Court Judge shall receive an annual salary of not less than $65,000 and not more than $70,000, exclusive of housing and other benefits, as determined by the Chief Justice.

(D) Each Associate Justice of the National Court shall receive an annual salary of not less than $45,000 and not more than $60,000.

(E) The Presiding Judge shall receive an annual salary of not less than $50,000 and not more than $75,000.

(F) Each Associate Justice shall receive an annual salary of not less than $65,000 and not more than $80,000.

Section 19. Amendment. Sliding Fee Scale, Section 57 of RPPL No. 5-7, as codified in 34 PNC '331 is hereby amended to read as follows:

"Section 331. Fees for services. Effective 90 days after the effective date of this Act, the fees in the Ministry of Health Medical and Other Related Fee Schedule 1995 shall be suspended and the Minister of Health shall establish a new fee schedule for all non-Palauans and Palauans, pursuant to the Administrative Procedure Act, 6 PNC Chapter 1. However, Palauan citizens and their spouses shall be charged at a subsidized rate compared to non-Palauans. All funds received pursuant to these fee schedules shall be deposited into the Hospital Trust Fund established by RPPL No. 4-32, as amended by RPPL No. 7-7. The Minister of Health shall report to the Committees on Ways, Means and Financial Matters of both Houses of the Olbiil Era Kelulau on a semi-annual basis, report should at minimum provide the balance sheet of the Hospital Trust Fund Account. However:

(b) There shall be no distinction in treatment or care based on nonpayment......."

Section 20. Pension Plan Trust Fund. The sum of $2,000,000 is hereby authorized to be appropriated, in fiscal year 2006, for the purpose of providing cash to the Pension Plan Trust Fund in order for the Republic to meet its obligation, as stated in RPPL No. 2-26 and RPPL No. 3-21, of contributing additional sums to the Fund in order to keep the fund on a sound actuarial basis.

The sum of ~~$250,000~~ is hereby authorized and appropriated. The entire amount authorized and appropriated shall come from local revenues.

Section 21. Amendment. Palau Visitors Authority, Section 8 of RPPL No. 1-49, as codified in 28 PNC '508, is hereby amended to read as follows:

(b) implement the Republic of Belau Tourism Master Plan and the "Sustainable Development Policies and Action Plan" after its adoption;

(d) establish programs to develop and improve tourist services in the Republic, including but not limited to the development of local hosting, local network of services, training locals in tourism services, regulating tourism businesses, etc.,

(e) establish and formulate policies for sustainable development consistent with environmental quality and control;

(g) conduct programs of advertising, publicity and promotion designed to familiarize the traveling public with Palau;

(h) recommend to the President of the Republic and to the Olbiil Era Kelulau, legislation that will facilitate or establish necessary or desirable public policies and programs to increase and improve the number of tourist facilities in Palau, including the construction of additional hotel rooms, capacity building for labor and human resources, airport and affiliated facilities and attractions which would facilitate the entry of visitors to Palau;

(i) encourage the participation of foreign and local private capital in the development of tourism in Palau, by recommending to the President and the Olbiil Era Kelulau, legislation and programs that will foster investment from foreign sources into the Republic;

(j) recommend, to Bureau of Immigration and Division of Customs, efficient procedures to clear visitors through immigration and customs;

(k) recommend and develop projects and programs to improve communication between visitors and members of the community;

(l) establish community outreach and awareness programs to promote the manufacture of local handicrafts and establish regulations that establish standards of quality;

(m) provide liaison between government and private agencies and business in the promotion and regulation of visitor industry in Palau;

(n) apply for and seek foreign grant and technical assistance to develop and establish policies, programs and legislation in carrying out its duties and responsibilities;

(o) promulgate regulations to carry out the provisions of this subchapter, such regulations to be immediately transmitted to the Olbiil Era Kelulau and subject to legislative veto of the Olbiil Era Kelulau for 90 days following promulgation; and

(p) Palau Visitors Authority shall take any other specific steps as may be necessary to carry out its responsibilities and shall within 180 days from the effective date of this Act be in full compliance with the provisions in this subchapter."

Section 22. Amendment. Palau National Scholarship, Section 8(b) of RPPL No. 2-5, as codified in 22 PNC '227, to read as follows:

"Section 8. Power and duties. It shall be the duty and responsibility of the Board to:

(b) Develop, organize and adopt criteria to be followed in selecting scholarship recipients. Before adopting such criteria, the Board shall ensure that such criteria is fair and nondiscriminatory. In developing such criteria, the Board shall take into consideration the national objectives and priorities of the Republic of Palau. Notwithstanding the above, the criteria for scholarship, grant and loan recipients to be eligible to receive scholarship or loans from the Palau National Scholarship Fund, the recipient, a Palauan citizen, must have graduated from a high school in the Republic of Palau and/or one of his/her parents or legal guardian must physically reside in the Republic. In the event that the recipient graduated from a high school outside of the Republic, one parent or legal guardian must physically reside in the Republic. At minimum, the criteria for residency of the parent must be two or more years of physical residency in the Republic, or one or both parent works for the ROP Government and is a ROP taxpayer, prior to the receipt of scholarship, grant or loan and the continued physical residency of said parent, in the Republic, while student recipient is receiving scholarship, loan and/or grant. All recipients of scholarship grants and loans are required to work in the Republic for the duration of three (3) years, commencing two (2) years after completion of graduate degree studies, for graduate students or commencing two (2) years after completion of all other degree studies. If a grant or loan recipient ceases his degree studies and fails to obtain his degree, he is required to pay back 50% of the grant or loan within two years time. All grant and loan recipients regardless of completion of studies must work in the Republic for not less than three (3) years after the two-year grace period. If grant or loan recipient fails to return and work in the Republic within the allotted time period, said recipient shall be liable to pay back to the Scholarship Fund, the total amount of the grant and/or loan with interest."

Section 23. Amendment. Business Tax Refund, Section 306 of RPPL No. 1-63, as codified in Section 1206 of Title 40 of the Palau National Code is hereby amended to read as follows:

If a business files with the Director a verified receipt indicating financial contributions made by such business to nonprofit corporations, all nonprofit corporations are subject to regulations and must meet the criteria of eligibility for a business donor to receive a tax refund based on regulations promulgated by the Minister of Finance, during the tax year, the Director shall refund such amounts within 90 days after the end of the tax year; provided that the amount of such refund shall not exceed 10 percent of the gross revenue or net income taxes paid by that business in that tax year. Criteria for eligibility of a donor business to receive financial contributions tax refund, shall be based upon promulgation of regulations by the Minister of Finance, pursuant to Administrative Procedure Act, 6 PNC Chapter l."

Section 24. Amendment. Individual Tax Refund, Section 204 of RPPL No. 1-63, as amended by RPPL No. 4-36, '6, as codified in Section 1104 of Title 40 of the Palau National Code is hereby amended to read as follows:

If it is shown upon application by an employee that there has been withheld from his wages or salary any tax not due thereon, then the Director shall refund the amount overpaid within 30 days from the application. If an employee files with the Director a verified receipt indicating money paid for preschool, elementary, secondary or post secondary tuition for his own children or those under his guardianship, or financial contributions made by such employee to the Palau Community College or nonprofit corporations, which all non-profit corporations are subject to regulations and must meet the criteria of eligibility for the individual to receive a financial contributions tax refund. Eligibility shall be based upon promulgation of regulations by the Minister of Finance, pursuant to Administrative Procedure Act, 6 PNC Chapter 1, the Director shall refund such amounts within 90 days after the end of the tax year; provided that the amount of such refund shall not exceed 10 percent of income taxes paid by the employee in that tax year."

Section 25. Repeal. Bureau of Oceanic Fishery Management, RPPL No. 6-26 '21, as codified in Section 103 of Title 27 of the Palau National Code is hereby repealed, effective date of the repeal shall be the effective date of this Act.

Section 26. Amendment. Section 3 of RPPL 6-32, as codified in 30 PNC '164 is further amended to read as follows:

(a) Upon receipt of notice from the employment service officer of those positions which the employer requires, and for which no resident workers are available, the Chief shall determine whether the employment of such nonresident worker will be in the best interest of the Republic, shall determine under what conditions the employer should be authorized to hire nonresident workers for those positions,........................ employment of the worker with the same employer. A nonresident worker shall be ineligible for employment by any other employer in the Republic for five years following the date of termination of any previous employment in the Republic. For purposes of this Section, this provision shall not apply to spouses of Palauan citizens employed as nonresident workers.

Section 27. Amendment. Palau Severely Disabled Assistance Fund, Section 15 of RPPL No. 6-26 is amended to read as follows:

(g) Individuals receiving pension or social security benefits from the National Government are not eligible to receive benefits, including assistance and monthly stipends, under the Palau Severely Disabled Assistance Fund.@

Section 28. Outside Grants and Development Assistance. All funds received from outside sources, including, but not limited to, U.S. Federal Program Grants and Japan Grant Aid, are hereby authorized to be appropriated and are appropriated for fiscal year 2006 in the amounts received for those specific programs or projects for which they are granted, donated, or otherwise contributed. U.S. Federal Program Grants cost recoveries associated with such program grants may be retained for use by the President for such purposes as are needed to implement such programs or projects for which they were granted. The Minister of Finance shall report monthly to the Olbiil Era Kelulau the receipt of any outside grant or development assistance in the proceeding month. In addition to all other reporting requirements established by law or regulation, the Minister of Finance shall submit quarterly reports to the President and the Olbiil Era Kelulau setting forth expenditures and obligations of all funds received from outside sources and expended or obligated pursuant to this section. The funding appropriated pursuant to this section shall not lapse. All outside grants and development assistance, with the exception of US Federal Program Grants and Japan Aid Grant, received from other countries, organizations, or individual donors are hereby authorized and appropriated and are appropriated for the first six months of fiscal year 2006 in the amounts received for those specific programs or projects for which they are granted, donated, or otherwise contributed. All outside grants and development assistance, with the exception of US Federal Program Grants and Japan Grant Aid are subject to authorization and appropriation by the Olbiil Era Kelulau. The Minister of Finance shall, within 90 days from the effective date of this Act, submit to the Olbiil Era Kelulau a listing of all outside sources of funding for authorization and appropriation.

Section 29. Amendment. 11 PNC 1042(c) as amended by RPPL 5-9, Section 1(b) is hereby further amended to read as follows:

"(c) No cabaret license may be granted for premises located within 100 meters of any elementary school or church nor for any premises in an area where such business activities are prohibited by state or national law, except such a karaoke bar or restaurant may operate after 6:00 pm until midnight if it was in operation prior to January 1, 1997 and had a valid liquor license, and further provided that any cabaret license issued pursuant to section 1033, or any renewal of such license, may not extend beyond January 1, 2006."

Section 30. Effective Date. This Act shall take effect upon its approval by the President of the Republic of Palau or upon becoming law without such approval, except as otherwise provided by law.

Palau Sessional Legislation

FY 2006 Annual National Budget Act, RPPL 7-13 2005