The Compacts of Free Association and Public Safety: What the CRS Record Shows
The Compacts of Free Association let citizens of Micronesia, the Marshall Islands and Palau live and work in the United States. The 2024 renewal restored most federal benefits for Compact migrants but ended the Compact Impact grants that Hawaii, Guam and other host jurisdictions had received since 2004. For public safety agencies in those jurisdictions, the open questions are about funding, data and capacity.
What the Compacts are
The Federated States of Micronesia (FSM), the Republic of the Marshall Islands (RMI) and the Republic of Palau are sovereign states linked to the United States through the Compacts of Free Association. According to the Congressional Research Service (CRS report R48311), the three Freely Associated States (FAS) lie roughly 2,500 miles southwest of Hawaii, govern more than 1,000 islands and atolls across a maritime area larger than the continental United States, and have a combined population of about 200,000.
Under the Compacts, the United States provides economic assistance and holds the right to operate military bases in the FAS and to make decisions that affect mutual security. FAS citizens may live, work and study in the United States as lawful non-immigrants, and may volunteer for the U.S. Armed Forces. Compact economic assistance is time-limited; most provisions on defense, security and migration are not (CRS).
The 2024 renewal
In 2023 the United States signed agreements extending economic assistance for 20 years. CRS reports that they provide grant assistance and trust fund contributions of approximately $3.3 billion for the FSM, $2.3 billion for the RMI and $0.9 billion for Palau for FY2024–FY2043, plus $634 million to continue U.S. Postal Service operations. Congress approved them in the Compact of Free Association Amendments Act of 2024 (Division G, Title II of P.L. 118-42), signed on March 9, 2024 (CRS; U.S. Department of the Interior).
The security dimension
The FAS do not have their own militaries. CRS notes that more than 1,000 FAS citizens serve in the U.S. Armed Forces and that 18 have died in U.S. military service, mostly in the Iraq and Afghanistan wars. The U.S. Army operates the Ronald Reagan Ballistic Missile Defense Test Site on Kwajalein Atoll in the Marshall Islands, with base rights extended through 2066 and a U.S. option for 20 more years.
Recent defense laws also point toward governance and maritime capacity. The FY2022 National Defense Authorization Act calls for Defense Department engagement with the FAS that includes protecting fisheries from illegal, unreported and unregulated fishing, and the FY2024 act requires the Secretary of State to help the FAS establish national security councils. CRS also records that in 2019 and 2020 Palau law enforcement detained and deported hundreds of people, mostly PRC citizens, involved in illegal online gambling operations. ISPI's analysis of Operation Irensia 2026 looks at patrol boat crews from the three states training in Guam and the gap between exercises and routine operations.
Migration and host jurisdictions
Citing a 2020 report from the Government Accountability Office (GAO-20-491), CRS estimates that about 94,000 Compact migrants live in U.S. areas, split roughly evenly between the U.S. mainland and Hawaii plus the U.S. Pacific territories. The estimate includes U.S.-born children under 18 who hold dual citizenship. In order of FAS population size, the leading host jurisdictions are Hawaii, Guam, Washington, Arkansas, Oregon, California and Texas. From 2009 to 2018 the number of Compact migrants in U.S. states and territories rose by an estimated 68 percent.
Compact Impact funding has ended
The Compact Amendments Act of 2003 provided $30 million a year in Compact Impact funds from 2004 through 2023, apportioned by FAS migrant population; in FY2023 nearly 95 percent went to Hawaii and Guam. From FY2012 to FY2023 Congress added between $3 million and $6 million a year in discretionary Compact Impact funds. Hawaii, Guam and the CNMI reported a total of $3.2 billion in estimated Compact Impact costs from 2004 to 2018, and received approximately $509 million in Compact-related compensation from 2004 to 2019 (CRS; GAO).
Federal policy then shifted. The 1996 welfare reform law had restricted FAS migrants' eligibility for many federal programs, so host states and territories provided most of their social benefits. Congress restored Medicaid eligibility in 2020. The 2024 Act restored most other federal benefits and ended the Compact Impact grants, describing them as no longer necessary. CRS notes that some former recipients argue that federal program access without other compensation is inadequate.
What this means for public safety
This section is ISPI's analysis of the sourced record above.
First, funding. Restored eligibility for federal programs helps individuals and families; it is not a grant to a police department, a jail or an emergency management office. With the Compact Impact grants ended, any public safety cost of hosting Compact migrants now has to be met from general state, territorial or county budgets or from competitive federal grants. ISPI's PB-03 makes a related argument about the U.S. Pacific territories: population-based federal grant formulas miss the real operating costs of isolated island jurisdictions, and the brief recommends formulas that account for verified isolation factors and documented island cost premiums.
Second, data. CRS lists, among the issues Congress may consider, how the 2024 change has affected jurisdictions with FAS migration and whether to restore some level of Compact Impact funding. That review will rely on documented, jurisdiction-level cost data. Agencies that want public safety costs considered need to record them in a form that can be cited.
Third, research. PB-03 describes the Freely Associated States, along with American Samoa and the CNMI, as largely invisible in mainstream think tank research, and recommends dedicated, practitioner-grounded research on their public safety needs.
Further reading
ISPI's Compact States hub gathers our research and analysis on Micronesia, the Marshall Islands and Palau. For the U.S. territories that host many Compact migrants, see the Guam and CNMI hub and the Hawaii hub. For federal funding exposure in Hawaii, see HI-05: Federal Funding Risk and Hawaii Resilience. Recent ISPI commentary is listed in the newsroom.
Sources
- Congressional Research Service, “The Freely Associated States and Issues for Congress,” R48311, December 10, 2024
- U.S. Government Accountability Office, “Compacts of Free Association: Populations in U.S. Areas Have Grown, with Varying Reported Effects,” GAO-20-491, June 15, 2020
- U.S. Department of the Interior, “COFA Amendments Act”