Interior Announces Compact Infrastructure Funds for Palau

$2.7 Million to Support Palau Compact Road and Financial Management System

Last edited 11/30/2020
Contact Information

Contact: Tanya Harris Joshua 202-208-6008

WASHINGTON – U.S. Department of the Interior Assistant Secretary, Insular and International Affairs, Douglas W. Domenech today announced $2,685,610 in Compact Infrastructure grant funding for the Republic of Palau to maintain the Palau Compact Road and to purchase hardware for Palau’s new financial management system in addition to providing training and annual maintenance for the system.

“Interior Secretary David Bernhardt and I are pleased to provide this infrastructure support to the Government of Palau as agreed to under the Compact of Free Association agreement with Palau,” said Assistant Secretary Domenech. “I am proud of the support and the relationship that we share with the people of Palau. The United States sees Palau as an essential part of a free and open Indo-Pacific region and is committed to Palau’s security and prosperity.”

The $2,685,610 in Compact funding provided for under the Section 432 Review (the “Compact Review Agreement”) between the United States and Palau is divided as follows:

  • Palau Compact Road maintenance - $2,000,000 for fiscal year (FY) 2020. As provided for under the Compact Review Agreement, signed in 2018, Palau is scheduled to receive $2,000,000 for each fiscal year through FY 2024.

  • Financial Management System, Phase 2 - $685,610 to procure hardware and cover the system maintenance fee, training, and other contractual services necessary for the next two years to build and maintain the financial management system for the Palau National Government. The system supports all financial systems and operations across the Palau National Government, including payroll, immigration, law enforcement, and other critical services.

The Palau Compact Road, provided for under the Compact of Free Association agreement between the United States and Palau (Public Law 99-658), was built and completed by the U.S. Army Corps of Engineers in 2007 at the cost of $149 million dollars. This 53-mile, circumferential road on Babeldaob Island provides important access to Palau’s largest island and facilitates opportunities for economic development through improved transportation.

The subsequent Palau Compact Review Agreement, included in the Consolidated Appropriations Act of 2018 which was signed as Public Law 115–141 by President Trump on March 23, 2018, provided additional infrastructure, economic development, and trust fund support to Palau through FY 2024. On September 20, 2018, the United States and Palau governments signed a final agreement confirming uses of the funds and a schedule for disbursement through 2024. The Department of the Interior’s Office of Insular Affairs administers and manages these funds on behalf of the U.S. Government.

For more information about the work of the Office of Insular Affairs, visit or follow @ASIIADomenech on Twitter.

The Assistant Secretary, Insular and International Affairs, and the Office of Insular Affairs carry out the Secretary of the Interior’s responsibilities for the U.S. territories of American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands. Additionally, OIA administers and oversees federal assistance under the Compacts of Free Association to the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau.


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