Northern Mariana Islands Economic Expansion Act

Mr. Speaker, the recently announced decision to lay off ``temporarily'' hundreds of U.S. workers at the Imperial Pacific International casino construction site in the Northern Mariana Islands raises serious concerns about the use of foreign labor at this project. Pacific Rim, the contractor, announced the lay-off in July pending ``contract renegotiations.'' Meanwhile, work will go on, using foreign workers with H-2B visas to replace the U.S. workers.

Even half-finished, the Imperial Pacific International casino has lifted the economy of the Marianas. So, local news has focused on reassuring the public that work to complete the casino and its associated resort would continue. But these reassurances mean little to the U.S. workers who have lost their jobs, or to their families.

It also raises the question of why the U.S. Department of Labor, as it has reported to me, issued 1,668 foreign labor certifications to Imperial Pacific International to hire the H-2B visa holders, who are now taking the jobs of U.S. workers in apparent contravention of U.S. labor law.

Labor issued these foreign labor certifications to Imperial Pacific International (IPI) despite the history of occupational safety and health and wage and hour violations that the Department previously uncovered at this job site.

In May 2017, after a worker fell to his death and multiple other, serious workplace injuries were treated at the local hospital, the Occupational Safety and Health Administration proposed $193,750 in penalties for three of IPI's construction subcontractors.

In March 2018, the Department finalized settlements with IPI subcontractors of $13.9 million for unpaid wages and liquidated damages owed to over 2,400 employees.

In addition to these violations of the Occupational Safety and Health Act and the Fair Labor Standards Act, a raid of the site by the Federal Bureau of Investigation also revealed that the subcontractors had been unlawfully employing persons who were admitted to the United States from China as tourists.

This record in itself should have raised red flags at the U.S. Department of Labor. But the underlying purpose and process for foreign labor certification seems also in this case to have been subverted.

In order to obtain foreign labor certifications, which are a prerequisite to applying for an H-2B visa, an employer must attest that the job in question will be offered to any qualified and available U.S. worker who applies or is referred for the job opportunity. And in order to obtain an H-2B visa, an employer must attest that they have not laid off and will not lay off any similarly employed U.S. worker, unless the layoff is for lawful, job-related reasons and unless all H-2B workers are laid off first. The present lay-offs of U.S. workers, while work continues using H-2B workers, cannot be consistent with these employer attestations.

Let us look at the history of the Imperial Pacific International worksite:

In fiscal year 2016 the Marianas experienced a labor crisis, when the annual, numerical cap was reached for the Commonwealth Only Transitional Worker (CW) program. For the first time the Department of Homeland Security stopped accepting applications for this foreign labor program, unique to the Marianas. As the Government Accountability Office explained in a 2017 report commissioned by Senate Energy and Natural Resources Committee Chairman Lisa Murkowski, Ranking Member Maria Cantwell, and I:

Demand for foreign workers in the CNMI exceeded the

available number of CW-1 permits in 2016--many approved for

workers from China and workers in construction occupations.

The construction of a new casino in Saipan is a key factor in

this demand.

In fact, GAO reported, the demand for foreign workers jumped from 9,188 in 2014 to a number exceeding the 2016 cap of 13,299, almost entirely because of the demand for construction workers. The result was to crowd out established, local businesses, who employed CW workers and to force long-time foreign workers, who had demonstrated value to our economy and established roots in our community, to return home.

Not only was this crush of construction workers at the casino site economically and socially disruptive, it also did not jibe with the rules for the CW program. CW permits are only available to employers of foreign workers who are ineligible for any other U.S. work visa. Although some of the casino construction workers held CW permits (and some were employed illegally, having entered as tourists), we now know that these workers could well have received H-2B visas. Because, as the U.S. Department of Labor has reported, it issued 1,668 H-2B foreign labor certifications to IPI.

To end further abuse of the CW program and to protect the interests of local businesses in my district and their long-term workers and their families, I introduced legislation that, among other provisions, prohibited any further use of CW permits for new construction workers in the Marianas. Chairman Murkowski observed at her committee's hearing on my bill, H.R. 339, that this bar on the use of CW permits for new construction workers was in her view the most important provision. Not only did it curb the abuse of the CW permit, but it was also meant to force the federal government to make the determination, through the foreign labor certification process, of whether U.S. workers were available for any construction jobs on offer. President Trump signed my bill into law in August 2017. It became U.S. Public Law 115-53.

IPI quickly responded to these new constraints by hiring Pacific Rim, a U.S.-based firm, to continue construction of the casino. And Pacific Rim president and owner Keith Stewart announced to the Guam Daily Post that he was looking to hire hundreds of skilled U.S. tradesmen for the work. I include in the Record comments from Edward Deleon Guerrero, Executive Director of the Commonwealth Casino Commission, who reacted positively to this news in an interview with KSPN-TV in January 2018:

Reporter: IPI is currently in contractual conversations

with a new construction company, Pacific Rim, to finish the

resort.

Guerrero: We are more confident when we are dealing with a

U.S. construction company.

Reporter: IPI's previous, Chinese-based construction

companies brought in illegal construction workers and

ultimately caused progress on the building to come to a

standstill, once the FBI realized what was going on. Guerrero

hopes to avoid, quote, `another fiasco like that from

happening again.'

Guerrero: Definitely do not want to see a repeat of that.

Reporter: This time around, however, the work will be done

with mostly U.S. based workers.

Guerrero: It is my understanding that all, I mean, most, if

not all of the workers are U.S. construction workers.

In March, Pacific Rim held a job fair on Guam, which drew enthusiastic response from U.S. workers, who expressed a willingness to move to Saipan for new work opportunities and the chance to earn overtime and per diem, in addition to their regular pay. At the fair Pacific Rim General Superintendent Tony Costa confirmed to the Post that his company wanted to have around 500 U.S. workers on the IPI site.

Marianas Governor Ralph Torres even testified with pride before the Senate Energy and Natural Resources Committee on February 6 of this year about the turnaround:

I'm proud to announce that because of learning of an issue

that was experienced last year, we have signed U.S.

contractors to finish the hotel of the casino that was

signed, I believe, less than a month ago that will be hiring

more U.S. workers to finish the construction of the hotel

site.

The Governor also said IPI intended to complete construction by August 2018 and assured the Committee that his administration was closely monitoring labor conditions at the site. It should be noted, too, that the original casino license agreement included the stated objective to have permanent U.S. residents be at least 65 percent of all employees--an objective that has not been met.

The Governor's testimony came at the hearing held to consider the Northern Mariana Islands U.S. Workforce Act, legislation that Chairman Murkowski and I had jointly introduced to incentivize the hiring of U.S. workers in the Marianas. President Trump signed the Act into law on July 24. Among other new protections for U.S. workers, Public Law 115-218 extends to the CW program the requirement for prior U.S. Department of Labor labor certifications, a stipulation the Governor, the Marianas Legislature, and our business community all rightly agreed to.

Despite all these efforts and assurances to U.S. workers, however, at the same time IPI had begun the process of applying for foreign labor certifications from the U.S. Department of Labor with the intent to secure H-2B visas and hire foreign construction workers. Nominally, these foreign workers were to buttress, not replace Pacific Rim's U.S. workforce. Instead, U.S. workers have now lost their jobs, replaced by foreign workers. Attestations to the U.S. Department of Labor that U.S. workers would not be laid off and replaced with foreign workers have not proven true. Assurances by the Governor to keep watch on the Imperial Pacific job site seem hollow in light of recent events.

This must stop.

The people of the Northern Mariana Islands, whom I represent, are tired of having outside, foreign interests time-after-time give our islands a black eye by skirting the law, cutting corners on safety, playing fast and loose with the rules and thinking they can get away with it, beholden only to their bottom line and a handful of high- ranking local officials.

The U.S. Department of Labor, after enabling IPI by granting 1,668 foreign labor certifications, must take immediate action to step up enforcement and ensure IPI maintains absolute compliance with U.S. law.

Mr. Speaker, I thank my colleagues for understanding that my bill, H.R. 339, as amended by the Senate, was time-critical and for acting swiftly upon this measure on Friday, August 11.

H.R. 339, the Northern Mariana Islands Economic Expansion Act, was intended to provide one-time relief to the economic disruption that occurred in my district, when a surge of Chinese construction workers used up one-third of the available Commonwealth-only Transitional Worker permits for fiscal year 2017. This left many of our local businesses, small and large, in the lurch. These businesses have foreign workers on their staff, who know the business and upon whom employers rely, for whom fiscal year 2017 permits became unavailable as a result of the Chinese surge. There is an annual limit on the number of these Commonwealth-only Transitional Worker, or CW-1, permits, which are specific and unique to the Marianas. For fiscal 2017, 12,998 were available. H.R. 339 provides 350 more to help out the businesses caught in this bind.

Had the Senate acted more quickly and had the Senate not decided to reduce the number of additional permits to 350, more local businesses could have been assisted. But the legislative process is collaborative and deliberative; and I respect that.

I can say that there are 306 permits that were scheduled to expire in August and September. So by providing an additional 350 permits, H.R. 339, as amended, matches up against that remaining need.

I also note that the Senate amendment takes the current permit system in a new direction by designating that at least 60 of the additional permits for fiscal 2017 must be used for workers in healthcare and at least 10 for power plant operators. These occupational categories are critical to public health and safety. It well may be that in the future any foreign worker permits, specific to the Marianas, will also have to begin to be prioritized to ensure that the most value is added to the Marianas economy by the permitted workers.

Although H.R. 339 provides one-time relief to an immediate shortage of permits, there is further intent. The bill contains two provisions that will make the problem we are fixing now less likely to recur in future.

First, and most importantly, the bill increases the fee that employers pay, as part of the permit process, that goes to training U.S. workers to fill the jobs currently held by foreign workers in the Marianas. Had the Marianas been less dependent on foreign workers, this year's crisis would have been proportionally less intense. So, we must continue to focus on adding U.S. workers to the economy.

The fee increase is from $150 per annual permit to $200. And the increase is permanent. It does not apply solely to fiscal 2017, as is the case with the extra permits. It is the intention of the legislation that the fee increase apply to petitions filed on or after the date of enactment, not to petitions previously filed.

Since the beginning of the transitional worker program, these fees have provided about $10 million to the Commonwealth of the Northern Mariana Islands government and been distributed to educational institutions. Over the same period of time, about 1,200 U.S. workers have been added to the local labor force. I understand from testimony of the Government Accountability Office to the Senate Energy and Natural Resources Committee in April of this year, that some $3 million of the collected fees remain unused.

Effective and prompt use of the U.S. worker training funds are goals I believe should be part of the consideration for future legislation. I introduced in the 113th Congress, H.R. 2200, a bill that would have required the Commonwealth provide to the Secretary of Homeland Security a plan for the expenditure of these funds with a specific, numerical goal for job placement of U.S. workers. My legislation also required a biennial report by the Comptroller General on whether this goal had been met. That legislation did not make it to the finish line here in Congress; however, along with the allocation of permits for specific, high-value occupations, setting performance goals for the U.S. worker training fund is a policy I believe should be a part of our future considerations.

The second provision intended to prevent a recurrence of the current crisis bars the use of the CW-1 permit for new workers in construction occupations. Existing construction companies with foreign workers, who have been in their employ prior to fiscal year 2016, will be able to continue renewing the CW-1 permits of those specific individual workers. There are between 1,000 and 1,500 such individuals, I understand. Approval for a CW-1 permit for an individual in a construction occupation may not be granted, if the individual was not previously approved for a CW-1 permit before October 1, 2015. And no approvals for initial grant of CW-1 status to individuals in construction occupations, as defined in H.R. 339, may be issued, regardless of whether the employer previously petitioned for an employee in such occupation or whether that petition had been approved. This provision, too, is to be continuously effective beyond fiscal year 2017. To avoid unnecessary economic disruption, implementation of the provision barring use of CW-1 permits for construction occupations is intended to apply to pending petitions and to petitions filed on or after the date of enactment.

This division created by H.R. 339 between legacy and new workers will allow our existing construction companies to continue meeting the demand for housing and other buildings that still remains because of the destruction caused by Typhoon Soudelor in 2015 and, also, results from the overall improvement in the Marianas economy.

Enactment of H.R. 339 does not mean, however, that the Marianas economy will not have access to construction workers to supplement the local labor force. New hires for construction of developments such as the hotels and resorts now on the drawing boards in the Marianas will be--preferably--local, U.S. workers. Alternatively, however, these developments may use visa categories other than

the CW-1 to supply foreign workers. In U.S. Public Law 113-235 Congress provided the Marianas with access to an unlimited number of H-2B visas, which are specifically intended to address any temporary need for workers, such as occurs when a new hotel is built.

In fact, in order to be eligible to apply for the CW-1 permit, applicant businesses must attest that no other visa category is available. In light of the unlimited number of H-2B visas available and because the current problem stems from the use of CW-1 permits for temporary construction workers, I have on numerous occasions requested that U.S. Citizenship and Immigration Services confirm that these attestations are accurate. Enactment of H.R. 339 makes matters simpler: construction occupations are no longer eligible for CW-1 permits with the exception of renewals of permits first issued prior to fiscal 2016.

Mr. Speaker, thank you for the opportunity to provide this statement of legislative intent today to the record on H.R. 339. And thanks, again, to all my colleagues who made it possible to move forward with the Northern Mariana Islands Economic Expansion Act.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I would like to thank Chairman Rob Bishop for allowing my bill to come to the floor again.

We passed the same bill in the House on December 6, but the Senate adjourned 3 days later without acting, and the problem has not gone away.

The economy of the Northern Mariana Islands grew 3.5 percent last year, the fourth straight year of growth for my district.

This strong economic expansion is good news for the people I represent. We desperately want this growth to continue because our economy is still smaller than it was in 2000.

The Northern Mariana Islands Economic Expansion Act addresses that problem and is broadly supported back home.

Mr. Speaker, I include in the Record letters of support from Governor Ralph Deleon Guerrero Torres of the Commonwealth of the Northern Mariana Islands; from the Commonwealth's Strategic Economic Development Council; the Commonwealth Healthcare Corporation; the Hotel Association of the Northern Mariana Islands; and from the Saipan Chamber of Commerce.

CNMI Strategic Economic

Development Council,

December 1, 2016.

Hon. Gregorio Kilili Camacho Sablan,

House of Representatives,

Washington, DC.

Dear Congressman Sablan: The CNMI Strategic Economic

Development Committee is in strong support of H.R. 6401,

critical legislation that will provide short-term relief from

the labor shortage threatening the growth of the Northern

Marianas economy.

The U.S. Bureau of Economic Analysis indicates the

Commonwealth economy grew for the fourth consecutive year, a

recent high of 3.5 percent. This is attributable to increased

private investment and tourism now threatened by the lack of

available qualified workers on the island.

The modest one-year increase in Commonwealth-Only

Transitional Workers (CW) proposed under H.R. 6401, will

provide the business community with the necessary human

resources to continue to operate and propel an expanding

economy.

It is imperative that we do not stymie our plan for fixture

economic growth, now beginning to come to frutition, with a

labor shortage in critical areas.

The bill also provides additional funds for the job

training/education programs proven effective at expanding the

pool of qualified and skilled U.S. workers in the CNMI.

The CNMI Strategic Economic Development Council fully

supports H.R. 6401 and appreciates all of your efforts in

addressing the labor crisis in the Northern Marianas.

Very truly yours,

Alexander A. Sablan,

Sub Committee Chairman, Labor & CW Task Force, CNMI

Strategic Economic Development Committee.

Mr. Speaker, I want to thank again Chairman Rob Bishop of the Natural Resources Committee for his understanding and support. I also thank Chairman Don Young who held a hearing on this issue last September and agreed that action was needed.

I appreciate the support of Ranking Member Raul Grijalva and our new Indian, Insular and Alaska Native Affairs Subcommittee Ranking Member Norma Torres.

Mr. Speaker, I am indebted to the minority whip, Mr. Hoyer, and to the

majority leader, Mr. McCarthy, and to my friend Mr. McClintock of California who agreed to bring H.R. 339 to the floor today.

I ask for support of H.R. 339.

Having no further speakers, I yield back the balance of my time.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 339) to amend Public Law 94-241 with respect to the Northern Mariana Islands.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days to revise and extend their remarks and include extraneous materials on the bill under consideration.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, the House has before it H.R. 339, sponsored by Congressman Sablan of the Commonwealth of the Northern Mariana Islands.

The House passed an identical bill this past December just before the conclusion of the 114th Congress. However, that bill was unable to pass the Senate and make it to the President's desk for signature before the end of that Congress, and so I am here today to once again urge the bill's passage through the House and on to the Senate.

The Northern Mariana Islands are benefiting by new investment and growth of consumer spending, particularly in tourism. Their economic growth rate is almost twice that of the rest of our country.

To meet this growth, the Commonwealth has to maintain a workforce to match it. Currently, the Northern Marianas is phasing out the use of foreign workers by slowly reducing the total number of CW-1 permits issued by the Department of Homeland Security. Economic growth is dynamic, but bureaucracy is not. If the CW-1 permits are phased out too quickly, the islands may suffer a growth-stopping shortage of labor. This bill would provide flexibility to the Commonwealth in order to protect its newfound economic prosperity in three critical ways:

First, it would fund ongoing vocational education curricula and program development to assure a skilled domestic workforce funded from an increase in CW-1 fees from $150 to $200.

Second, it would limit the CW-1 permits for construction occupation to those issued prior to October 1 of 2015.

And third, it would temporarily increase the number of CW-1 permits during this transition period.

Mr. Speaker, these changes will continue to accommodate the economic growth in the Northern Marianas, while assuring a trained domestic workforce for the future.

I would urge adoption of the bill.

I reserve the balance of my time.

Mr. Speaker, I would urge the House to finish the work that it began in December by passing this bill.

I yield back the balance of my time.

At 12:02 p.m., a message from the House of Representatives, delivered by Mrs. Cole, one of its reading clerks, announced that the House has passed the following bills, in which it requests the concurrence of the Senate:

H.R. 46. An act to authorize the Secretary of the Interior

to conduct a special resource study of Fort Ontario in the

State of New York.

H.R. 339. An act to amend Public Law 94-241 with respect to

the Northern Mariana Islands.

H.R. 374. An act to remove the sunset provision of section

203 of Public Law 105-384, and for other purposes.

H.R. 381. An act to designate a mountain in the John Muir

Wilderness of the Sierra National Forest as ``Sky Point''.

H.R. 538. An act to redesignate Ocmulgee National Monument

in the State of Georgia and revise its boundary, and for

other purposes.

H.R. 558. An act to adjust the boundary of the Kennesaw

Mountain National Battlefield Park to include the Wallis

House and Harriston Hill, and for other purposes.

H.R. 560. An act to amend the Delaware Water Gap National

Recreation Area Improvement Act to provide access to certain

vehicles serving residents of municipalities adjacent to the

Delaware Water Gap National Recreation Area, and for other

purposes.

The message further announced that pursuant to 22 U.S.C. 1928a, and the order of the House of January 3, 2017, the Speaker appoints the following Members of the House of Representatives to the United States Group of the NATO Parliamentary Assembly: Mr. Connolly of Virginia and Ms. Frankel of Florida.

The message also announced that pursuant to 22 U.S.C. 2903, and the order of the House of January 3, 2017, the Speaker appoints the following Member of the House of Representatives to the Japan-United States Friendship Commission: Mr. Takano of California.

The message further announced that pursuant to 22 U.S.C. 2761, and the order of the House of January 3, 2017, the Speaker appoints the following Member of the House of Representatives to the British- American Interparliamentary Group: Mr. Cicilline of Rhode Island.

The message also announced that pursuant to 22 U.S.C. 3003, and the order of the House of January 3, 2017, the Speaker appoints the following Members of the House of Representatives to the Commission on Security and Cooperation in Europe: Mr. Hastings of Florida and Mr. Cohen of Tennessee.