“(a) Sector Grants. In order to assist the Government of the Republic of the Marshall Islands in its efforts to promote the economic advancement and budgetary selfreliance of its people, and in recognition of the special relationship that exists between the Republic of the Marshall Islands and the United States, the Government of the United States shall provide assistance on a sector grant basis beginning in FY 2004 in the amounts set forth in section 217. Such grants shall be used for assistance in education, health care, the environment, public sector capacity building, and private sector development, or for other areas as mutually agreed, with priorities in the education and health care sectors. Consistent with the medium-term budget and investment framework described in subsection (f) of this section, the proposed division of this amount among the identified areas shall require the concurrence of both the Government of the United States and the Government of the Republic of the Marshall Islands, through the Joint Economic Management and Financial Accountability Committee described in section 214. The Government of the United States shall disburse the grant assistance and monitor the use of such grant assistance in accordance with the provisions of this Article and the Agreement Concerning Procedures for the Implementation of United States Economic Assistance Provided in the Compact, as amended, of Free Association Between the Government of the United States of America and the Government of the Republic of the Marshall Islands, done at Majuro on March, 23, 2004 (‘2004 Fiscal Procedures Agreement’).“(1) Education. United States grant assistance under subsection (a) of this section shall be made available in accordance with the strategic framework described in subsection (f) of this section to support and improve the educational system of the Republic of the Marshall Islands and develop the human, financial, and material resources necessary for the Republic of the Marshall Islands to perform these services. Emphasis should be placed on advancing a quality basic education system.
“(2) Health. United States grant assistance under subsection (a) of this section shall be made available in accordance with the strategic framework described in subsection (f) of this section to support and improve the delivery of preventive, curative, and environmental care and develop the human, financial, and material resources necessary for the Republic of the Marshall Islands to perform these services.
“(3) Private Sector Development. United States grant assistance shall be made available in accordance with the strategic framework described in subsection (f) of this section to support the efforts of the Republic of the Marshall Islands to attract foreign investment and increase indigenous business activity by vitalizing the commercial environment, ensuring fair and equitable application of the law, promoting adherence to core labor standards, maintaining progress toward privatization of state-owned and partially state-owned enterprises, and engaging in other reforms.
“(4) Capacity Building in the Public Sector. United States grant assistance under subsection (a) of this section shall be made available in accordance with the strategic framework described in subsection (f) of this section to support the efforts of the Republic of the Marshall Islands to build effective, accountable, and transparent national and local government and other public sector institutions and systems.
“(5) Environment. United States grant assistance under subsection (a) of this section shall be made available in accordance with the strategic framework described in subsection (f) of this section to increase environmental protection; establish and manage conservation areas; engage in environmental infrastructure planning, design construction, and operation; and to involve the citizens of the Republic of the Marshall Islands in the process of conserving their country’s natural resources.
“(b) Kwajalein Atoll.“(1) Of the total grant assistance made available under subsection (a) of this section, the amount specified herein shall be allocated annually from FY 2004 through FY 2023 (and thereafter in accordance with the Agreement Regarding the Military Use and Operating Rights of the. Government of the United States in the Republic of the Marshall Islands Concluded Pursuant to Sections 321 and 323 of the Compact of Free Association, as Amended) to advance the objectives and specific priorities set forth in subsections (a) and (d) of this section and the 2004 Fiscal Procedures Agreement through 2023 (and thereafter to advance the objectives and specific priorities set forth in subsection (a) of section 261 and the 2023 Fiscal Procedures Agreement), to address the special needs of the community at Ebeye, Kwajalein Atoll and other Marshallese communities within Kwajalein Atoll. This United States grant assistance shall be made available, in accordance with the medium-term budget and investment framework described in subsection (f) of this section through FY 2023, and thereafter in subsection (c) of section 261, to support and improve the infrastructure and delivery of services and develop the human and material resources necessary for the Republic of the Marshall Islands to carry out its responsibility to maintain such infrastructure and deliver such services. The amount of this assistance shall be $3.1 million, with an inflation adjustment as provided in section 218, from FY 2004 through FY 2013 and the FY 2013 level of funding with an inflation adjustment as provided in section 218, shall be increased by $2 million for FY 2014. The FY 2014 level of funding, with an inflation adjustment as provided in section 218, shall be made available from FY 2015 through FY 2023 (and thereafter as noted above).
“(2) The Government of the United States shall also provide to the Government of the Republic of the Marshall Islands, in conjunction with section 321(a) of this Compact, as amended, an annual payment from FY 2004 through FY 2023 (and thereafter in accordance with the Agreement Regarding the Military Use and Operating Rights of the Government of the United States in the Republic of the Marshall Islands Concluded Pursuant to Sections 321 and 323 of the Compact of Free Association, as Amended) of $1.9 million. This grant assistance shall be subject to the 2004 Fiscal Procedures Agreement through FY 2023, and thereafter to the 2023 Fiscal Procedures Agreement, and shall be adjusted for inflation under section 218 and used to address the special needs of the community at Ebeye, Kwajalein Atoll and other Marshallese communities within Kwajalein Atoll with emphasis on the Kwajalein landowners, as described in the 2004 Fiscal Procedures Agreement through FY 2023, and thereafter in the 2023 Fiscal Procedures Agreement.
“(3) Of the total grant assistance made available under subsection (a) of this section, and in conjunction with section 321(a) of the Compact, as amended, $200,000, with an inflation adjustment as provided in section 218, shall be allocated annually from FY 2004 through FY 2023 (and thereafter as provided in the Agreement Regarding the Military Use and Operating Rights of the Government of the United States in the Republic of the Marshall Islands Concluded Pursuant to Sections 321 and 323 of the Compact of Free Association, as Amended) for a grant to support increased participation of the Government of the Republic of the Marshall Islands Environmental Protection Authority in the annual U.S. Army Kwajalein Atoll Environmental Standards Survey and to promote a greater Government of the Republic of the Marshall Islands capacity for independent analysis of the Survey’s findings and conclusions.
“(c) Humanitarian Assistance - Republic of the Marshall Islands Program. In recognition of the special development needs of the Republic of the Marshall Islands, the Government of the United States shall make available to the Government of the Republic of the Marshall Islands, on the Government of the Republic of the Marshall Islands’ request and to be deducted from the grant amount made available under subsection (a) of this section and subsection (a) of section 261, a Humanitarian Assistance—Republic of the Marshall Islands (‘HARMI’) Program with emphasis on health, education, and infrastructure (including transportation) projects and such other projects as mutually decided. The terms and conditions of the HARMI shall be set forth in the Agreement Regarding the Military Use and Operating Rights of the Government of the United States in the Republic of the Marshall Islands Concluded Pursuant to Sections 321 and 323 of the Compact of Free Association, as Amended.
“(d) Public Infrastructure.“(1) Unless otherwise agreed, not less than 30 percent and not more than 50 percent of U.S. annual grant assistance provided under subsection (a) of this section shall be made available in accordance with a list of specific projects included in the infrastructure improvement and maintenance plan prepared by the Government of the Republic of the Marshall lslands as part of the strategic framework described in subsection (f) of this section.
“(2) Infrastructure Maintenance Fund. Five percent of the annual public infrastructure grant made available under paragraph (1) of this subsection shall be set aside, with an equal contribution from the Government of the Republic of the Marshall Islands, as a contribution to an Infrastructure Maintenance Fund. Administration of the Infrastructure Maintenance Fund shall be governed by the 2004 Fiscal Procedures Agreement through FY 2023.
“(e) Disaster Assistance Emergency Fund. Of the total grant assistance made available under subsection (a) of this section, an amount of two hundred thousand dollars ($200,000) shall be provided annually, with an equal contribution from the Government of the Republic of the Marshall Islands, as a contribution to a Disaster Assistance Emergency Fund (‘DAEF’). Through FY 2023, any funds from the DAEF may be used only for assistance and rehabilitation resulting from disasters and emergencies. Through FY 2023, the funds shall be accessed upon declaration of a State of Emergency by the Government of the Republic of the Marshall Islands, with the concurrence of the United States Chief of Mission to the Republic of the Marshall Islands. Through FY 2023, the administration of the DAEF shall be governed by the 2004 Fiscal Procedures Agreement.
“(f) Budget and Investment Framework. Through FY 2023, the Government of the Republic of the Marshall Islands shall prepare and maintain an official mediumterm budget and investment framework. The framework shall be strategic in nature, shall be continuously reviewed and updated through the annual budget process, and shall make projections on a multi-year rolling basis. Each of the sectors and areas named in subsections (a), (b), and (d) of this section, or other sectors and areas as mutually agreed, shall be accorded specific treatment in the framework. Those portions of the framework that contemplate the use of United States grant funds shall require the concurrence of both the Government of the United States and the Government of the Republic of the Marshall Islands.