§3751 Payments to Republic of Panama

Summary

The Commission must pay Panama the amounts the 1977 Panama Canal Treaty requires in Article III(5) and Article XIII(4). Payments under Article III(5) will be audited each year by the Comptroller General. If the audit finds an overpayment under Understanding (1) in the Senate’s ratification (adopted April 18, 1978), Panama must refund it or the amount will be taken from future treaty payments. When deciding if revenues exceed expenses for Article XIII(4)(c) payments, revenues for a fiscal year are reduced by (1) that year’s costs as shown in the accounts created under section 3721 and (2) the running total of past years’ shortfalls starting when the Treaty goes into effect. The President must not accept any reading of Article IX(1) that would let Panama tax retroactively U.S. businesses or U.S. citizens who were in the Canal Zone before October 1, 1979. Any unpaid balance at Treaty end is payable only up to the final year’s operating surplus; the U.S. is not required to pay amounts after the Treaty ends. Tolls must not be set to raise money for Article XIII(4)(c) payments, and those payments may be made only if unspent funds first cover all operation and maintenance costs, including the categories and statutory payments listed (e.g., GAAP operating expenses, other treaty payments, plant replacement, Treasury payments under section 3793, reimbursements under section 3731, Treaty implementation costs, and working capital). The bans in this law and in sections 3712(b) and 3783 apply even if other laws would allow moving or reprogramming money. Finally, automatic cuts ordered under the Balanced Budget and Emergency Deficit Control Act of 1985 cannot be applied if doing so would force a payment to Panama under Article XIII(4)(c) and this law.