Government of the Federated States of Micronesia

Nena responds to Walter’s Draw-down Request

PALIKIR, Pohnpei (FSM Information Service): March 13, 1998 –
Effective April 1 this year, all drawdown on Chunk State Current Funds will be deposited
directly to Chuuk General Fund checking account President Jacob Nena informed Chuuk
Governor Ansito Walter on March 4.

On February 3, Walter requesting that Chuuk Current Account funds be drawn-down monthly, instead of biweekly basis. And the approval
of payment be delegated to allottee to eliminate unnecessary delays in payment. Nena assures Walter that the ESM will continue to provide needed support for the state’s
financial stability.

From June 1997 to February of this year, Chuuk State’s share of FSM Revenues collect by Chuuk Office endorses by appropriate Chunk State
officials and deposits into the FSM Government’s bank account as payment of delinquent taxes.

Chuuk State owes total of $4.4 million back taxes, $1.4 in principle and $3.0 million in interest and penalties, Nena adding, that he
hopes to recover the outstanding balance from the proceed of the Chunk Recovery Loan from the National Government under Public Law No.10-31, appropriating $3,761,987 and
authorizing the lending of $1,238,013 as first installment to Chuuk State.

But, Nena stating that no definite arrangement has been made among the two governments and requesting Governor Walter’s assistance in the matter.