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used in identifying the adverse consequences, and shall identify any assumptions made in reaching those conclusions.

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All of the items in the Proposed Judgment come directly from the

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Compacts of Free Association Act of 1985, except the latter,
addressed infra.

In determining whether summary judgment is appropriate, the
only issue is whether the current report was a reasonable
exercise of agency discretion. The review being conducted by the
Court is conducted pursuant to $706 of the APA, which states,

To the extent necessary to decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. The reviewing court shall

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(1) Compel agency action unlawfully withheld or
unreasonably delayed; and

(A) arbitrary, capricious, an abuse of discretion,
or otherwise not in accordance with the law.

(B) contrary to constitutional right, power,
privilege or immunity

(C) in excess of statutory jurisdiction,
authority, or limitations or short of statutory
right;

(D) without observance of procedure required by
the law;

(E) unsupported by substantial evidence in a case
subject to sections 556 and 557 of this title..........
(F) unwarranted by the facts to the extent that
the facts are subject to trial de novo by the
reviewing court.

In its review, this Court may consider whether the agency action

was based on a consideration of the relevant factors. Motor Yehicle Manufacturers Association v. State Farm Mutual Auto Ins.

Page 4

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Co., 463 U.S. 29 (1983).

The plaintiffs jointly argue that the report is inadequate,

and therefore is not in compliance with the mandate of Congress

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to assess the impact on the affected areas. Hawaii argues that

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the report fails to take Hawaii into account at all, thus abusing

the mandate of Congress in preparing the report. The CNMI

further argues that the report fails entirely in assessing the financial impact on the affected areas.

The U.S. cautions the court not to undertake review beyond the bounds of the case law. This Court agrees that it cannot substitute its judgment for that of the statisticians. Ethyl Corp. v. EPA, 541 F.2d 1, 36 (D.C. Cir.) cert. denied 462 U.S. 953 (1976). However, this prohibition is not encroached by a 14 finding that the September 1996 Report shows none of its sources for its sweeping comments and conclusions. This is not a

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substitution for judgment of statisticians

it is an

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observation that the sources are not identified.

Second, the U.S. cautions that this Court cannot impose its own interpretation on a statute. The court can only determine

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resting on a rational basis. The Court agrees with this premise. However, the 1996 Report appears to be based on no basis whatsoever except the author's subjective impressions.

This

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cannot be said to be resting upon a rational basis.

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A review of the Report indicates that it is a hastily

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1 compiled last-minute report which merely glosses over the areas directed to be analyzed by Congress. It makes sweeping

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statements without regard to data, for example: "Extrapolating

[from the 1990 census] to 1996 would give about 1200 arrivals [to Hawaii] since the Compact. These numbers are probably too low and should be improved through a census of Micronesians. «8 The Court suggests that a report assessing the impact of Micronesian migration should have before it the numbers involved in that migration. "No provisions of the Compacts addressed labor laws in the freely associated state or in the U.S. insular areas. No impact of the compact on labor laws has been brought to our attention." The Court questions how a report of this nature can be thorough if it does not address the kinds of jobs held by Micronesians, and any potential displacement of local or foreign workers, and does not address allegations of job discrimination against Micronesians in the affected areas. "No impact on environmental regulation resulting from the Compact has been brought to our attention by Guan or the CNMI.10 The Court questions how a report can be thorough when it reports no environmental consequences to the impacted areas. There are families of Micronesians living on the beaches of Guam. There

are wastewater and other infrastructure issues created by the
migration. Where are the sources from which OIA makes the

statement that there is "no impact"?

Another example of the superficial nature of the report is

found in the recommendations that OIA makes after the 15 page
"cumulative" report. OIA recommends four things: (1)

"initiation of a federal-insular analysis" of the impact of
legislation. Does this mean preparation of a report? Isn't OIA
| already supposed to prepare a report? (2) limit migration to
Guan; (3) limit migration to CNMI; and (4) continue support for
Congressional funding. These conclusions are meaningless. OLA
proposes that Guan limit migration, but Guan does not control
immigration to its shores. The Immigration and Naturalization
Service controls immigration on Guam. OLA argues that CNMI limit
migration to its shores. The CNMI has the power to control
immigration, but this suggestion belies another sensitive issue
in CNMI-US relations, beyond the purview of this case. Finally,
OLA recommends that it study the problem further and support
funding, which is OIA's statutory duty under the law in any
event.

Further evidence of the OIA's inappropriate nonchalance is found in a declaration of Allen Stayman, Deputy Assistant Secretary, Office of Territorial and International Affairs, Department of the Interior. In it, he lists the actions he has taken in keeping Congress notified of all territorial affairs. Page 7

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Most communications with Congress have been oral, in the form of testimony to Congress. However, he also discusses his duties

under $1904 (e). Without committing to any course of action, he

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states that he needs to "decide how best to devote scarce

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resources to securing this information."

He also states that he

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does not believe that "an annual survey or census would be an
appropriate use of our limited resources," but in the next

sentence, "we also plan to fund a survey of Micronesian

populations in Hawaii." Though the U.S. argues that Congress has never appropriated funds for OIA to conduct an analysis of the financial impact, the Court questions what OIA's yearly budget is supposed to be spent on. Can it not accommodate the cost of OIA staff obtaining statistics from Immigration and Naturalization and from Guam Public Health and Social Services, etc? Special funding should not be required. Yet, in the next sentence, the U.S. argues that negotiations are underway to fund a study that will allow Guam to assess compact-impact.

Finally, the U.S. argues that $1904 does not impose an affirmative obligation to include a financial quantification of the impact. This defies common sense; if Congress is going to "act sympathetically and expeditiously to redress those adverse consequences" how is Congress to do so without numbers?

The Court concludes that the Report that is at issue in this lawsuit is inadequate as a matter of law. The agency action at issue in this case was not based on a consideration of the