O A 33 “(c) The Secretary of Energy shall report to the appropriate committees of the Congress, and to the people of the atolls described in subsection (a) of this section, annually, or more frequently if necessary, on the activities of the program provided by this section. Each such report shall include a description of the health status of the individuals examined and treated under the programm, an evaluation of the program by the scientific advisory committee, and any recommendations for unprovement of the condition of such individuals, Thefirst such report shall be submitted not later than one year after this section becomes law.” SECTION 104 Section 104 states that “* * * Federal programs shall not cease to apply to the Trust Territory of the Pacitic Islands either before or atter the termination of the trusteeship, without the express approval of Congress.” . We presume that this section is directed, at least in part, toward a policy concerning Federal programs in the Trust Territory that this ‘Department adopted in November 1978. That policy was in turn based upon the expectation that, upon termination of the Trusteeship, which the President has targeted for 1981, the many Federal grant programs nowapplicable to the Trust Territory would, for the most part, cease. That 1s the basis upon which the future political status of the Trust ‘Territory is being negotiated. The Federal programs in question are now of major significance in terms of revenue resources in the Trust Territory. They have totaled about $25 million per year in recent years (with the figure excluding a controversial feeding program, whichis new largely terminated except for emergencies). It was this Department’s view in November 1978, and it remains our view, that the Federal assistance level needs to be phased down, so that the post-trustee- ship entitics in Micronesia are not required to absorb the shock of a sudden termination of Federal aid of that magnitude. That November 1978 policy has, however, been criticized. It has been argued, for example, that under it this Departinent would be violating the Impoundment Control Act, because I*ederal funds would be prohibited from flowing to the Trust Territory when the Congress had made such flow mandatory. That wasnot then nor is it now our purpose. We do not intend that any Federal program thatis, by law, required to be implemented in the Trust Territory be terminated with- out appropriate notification to the Congress through the authorization/appropriation process, or the Impoundment Control Act. However, our November 1978 policy was mainly directedat “discretionary” programs, those that the grantor or the grantee can applyif they so choose, as a matter of policy. It has also been argued that our November 1978 policy interferes with economic development, by foreclosing the application in the Trust Territory of federal programs directed to that end. Again, that was not and is not our purpose. Because of the controversy that has developed on this question, we are engaged now in a revision of that November 1978 policy statement. Weshall share the new statement withthe interested Committees when we have completed our consultations within the Executive Branch. Under these circumstances, the Administration strongly urges the