PUERTO RICO HERALD - WASHINGTON UPDATE

U.S. Justice: Residents Of "Commonwealth" Can Vote For President… Tax Cut For Island Businesses Acevedo Didn’t Want May Expand… More Hurricane Jeanne Appropriations Sought

October 1, 2004
Copyright © 2004 THE PUERTO RICO HERALD. All Rights Reserved.

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U.S. Justice: Residents Of "Commonwealth" Can Vote For President

U.S. Justice Department officials have confirmed that citizens of an unincorporated territory of the U.S. who formerly resided in a U.S. State can vote for president and vice president of the U.S., a representative of the territory was reliably reported to have said Friday.

Officials of the territory, the Commonwealth of the Northern Mariana Islands, announced earlier in the week that the Uniformed and Overseas Absentee Voting Act considers these residents of the territory as "overseas voters." As such, the NMI residents would be able to vote for federal officials by absentee ballot in the last State in which they resided.

The NMI officials added that some States permit citizens who live overseas and who have not resided in any State to vote in the State if their parents resided there.

The law considers citizens of the NMI from States to be overseas voters by not defining the Commonwealth as a part of the U.S.

The U.S.’ four other populated, unincorporated territories -- including the Commonwealth of Puerto Rico -- are defined as parts of the U.S. in the law. This means that instead of enabling citizens of these territories with residence history in States to vote for federal officials in States, the law provides for citizens from these territories who live overseas to vote in the four territories.

The four territories -- American Samoa, Guam, and the U.S. Virgin Islands in addition to Puerto Rico -- each elect a federal official: a resident commissioner in the U.S. in the case of Puerto Rico and a delegate to the U.S. House of Representatives in the case of each of the three other territories. The four territorial representatives have seats in the U.S. House but can only vote in its committees and caucuses. They cannot vote in the full House.

The NMI does not elect a federal official. It elects a Resident Representative in the U.S. but the representative does not have a seat in the U.S. House or the U.S. Senate. Commonwealth officials have been pressing, however, for the territory to be granted a delegate seat in the U.S. House.

Federal officials contend that the difference between the NMI and the four other territories in House representation justifies the different treatment between citizens of the five territories in the overseas voting law.

Citizens of the four territories other than the NMI, however, cannot vote for president and vice-president and U.S. senators in addition to a full voting representative in the U.S. House. Citizens of the NMI with a history of residence in the States can vote for all of these officials under the overseas voting law.

Federal officials used the fact of Puerto Rico’s House representation in opposing a federal lawsuit by Puerto Ricans with residence history in States seeking the right to vote in States by absentee ballot. The suit failed in the courts.

A close observer of the issue in Washington speculated Friday that the fact that NMI citizens with residence history in the States have been accorded full voting representation in the federal government would be used by citizens of Puerto Rico with residence history in the States to add to their efforts on the issue.

The different treatment would provide them with another argument for a lawsuit. But the law also suggests that they could become fully enfranchised in the election of federal officials if the law it is simply amended to exclude Puerto Rico from the definition of the U.S. for the purposes of the law.

In addition to creating a disparity between the treatment of citizens of the NMI and citizens of the four other territories, the law has created a difference in treatment among citizens of the NMI. Most citizens of the NMI do not have a residence history in the States and, therefore, cannot vote for federal officials in the States.

The federal law also does not prevent citizens of the NMI with residence history in the States from voting in the territory as well as the States. The fact that NMI elections are held in odd-numbered years and federal elections are held in even-numbered years facilitates the voting in two jurisdictions.

The NMI’s territorial government is encouraging residents with origins in the States to vote by absentee ballot from a State and is obtaining absentee ballot request forms for the residents.

The federal government encourages and facilitates voting in States and territories by citizens through its Federal Voting Assistance Program, which is led by the U.S. Department of Defense.

Tax Cut For Island Businesses Acevedo Didn’t Want May Expand

The chairman of the U.S. House’s tax committee has proposed expanding a tax cut on income that companies based in the States earn in Puerto Rico that the Commonwealth’s resident commissioner, Anibal Acevedo Vila ("commonwealth"/D), said he did not want.

Acevedo opposed the tax cut for Puerto Rico subsidiaries of companies based in the States when it was approved by the Senate Finance Committee. It had been proposed by Senator John F. Kerry, now the national Democratic Party’s nominee for president.

Acevedo nominally supports Kerry. He previously criticized the senator from the Commonwealth of Massachusetts on Puerto Rico issues such as the tax cut.

The tax cut would reduce the corporate income tax for some companies from 35 percent to 32 percent. The original version would have cut the tax for income from manufacturing in the States. Kerry proposed expanding the tax cut to include income from Puerto Rico and other U.S. territorial possessions.

House Ways and Means Committee Chairman Bill Thomas’ proposal this week would expand the tax cut to other types of production, such as preparing food, printing newspapers, and generating electricity.

Thomas (R-CA) made the proposal in a committee of representatives of the House and the Senate trying to reconcile differences between the House and Senate-passed versions of a major tax bill on corporate income. The committee’s goal is to obtain final congressional approval of the legislation next week before the Congress recesses for the November 2nd elections.

Taxation of income that U.S. companies earn outside the States is a primary focus of the legislation. Acevedo and Puerto Rico governor Sila Calderon ("commonwealth"/no national party) had hoped that the bill would cut the corporate tax rate on manufacturing income from Puerto Rico from 35 percent to zero, 3.5 percent, or 5.25 percent, depending on how the income was paid to parent companies in the States.

Kerry proposed including manufacturing income from Puerto Rico and the other territories in the tax cut when the Senate committee rejected the Calderon/Acevedo proposal for the second time.

The Senate committee did, however, approve another tax cut for income from Puerto Rico that Acevedo proposed. This tax cut would reduce the tax rate from 35 percent to 5.25 percent for one year only in the case of income from outside the States earned by subsidiaries of companies based in the States organized as "foreign" corporations. Acevedo asked a committee member, Senator John Breaux (D-LA), to have income from Puerto Rico included in the tax cut.

The purpose of this tax cut is to encourage U.S. companies to take money out of non-U.S. areas and bring it back to the U.S. With income from Puerto Rico included as requested by Acevedo, experts from the Congress’ Joint Committee on Taxation expect the provision to result in disinvestment from Puerto Rico and reinvestment of the money in the States.

The senior Democrat on the Ways and Means Committee, Charles B. Rangel (NY) and the chairman of the Senate Finance Committee, Charles Grassley (R-IA) do not want to expand the 35 to 32 percent tax cut to types of production in addition to manufacturing. Manufacturing groups suggested Thursday, however, that they would not contest the Thomas proposal in the interests of obtaining a final congressional agreement on the bill next week.

More Hurricane Jeanne Appropriations Sought

A Florida Republican who chairs the House Appropriations Committee hopes to obtain congressional approval next week of more funds than President George W. Bush has requested for efforts to help with the recovery from Hurricane Jeanne.

Chairman C.W. "Bill" Young wants to add to the $7.1 billion proposed for relief from Hurricanes Ivan and Jeanne. Both storms hit Florida. Jeanne did damage in Puerto Rico.

The funds would be in addition to $2 billion appropriated last month for the recovery from Hurricane Charley and $3.1 billion proposed last month for Hurricane Frances. Both storms also caused devastation in Florida.

While the Congress may complete action on these bills, it has given up on trying to pass bills to fund many other government programs for the fiscal year that began today, October 1st, before the elections. It has passed legislation to continue funding the programs at fiscal year 2004 levels until after the elections. Appropriations committee staff from both houses of the Congress think that new appropriations bills for many programs for fiscal year 2005 may not be completed until next January, when a new Congress takes office.


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