The central government is considering new 10-year legislation to give special grants to local governments that will be affected by the planned realignment of U.S. forces, government sources said Monday.
The bill calls for two new subsidy mechanisms to facilitate the realignment, but the government has yet to make a final decision on when to introduce it, the sources said. The current Diet session is scheduled to end June 18.
One of the mechanisms is designed to increase grants for municipal governments in phases corresponding with progress in each specific realignment program, according to the bill.
Under the other mechanism, municipalities would get grants for road, airport, ports and other infrastructure projects at a preferential rate if their requests are approved by the prime minister and ministers concerned.
The preferential treatment for infrastructure is especially aimed at localities that will be the most affected, including Nago, Okinawa Prefecture, and Iwakuni, Yamaguchi Prefecture, the sources said.
As part of the realignment package Japan and the United States finalized earlier this month, a new airfield will be built on the Nago coastline for relocation of the U.S. Marine Corps Air Station Futenma from downtown Ginowan, also in Okinawa, and Iwakuni will host a carrier air wing to be moved from Atsugi, Kanagawa Prefecture.
The bill calls for engaging the Japan Bank for International Cooperation in funding the agreed Japanese share of $6.09 billion, or 59 percent, of the estimated $10.27 billion cost for relocating 8,000 of 18,000 marines in Okinawa to Guam.
The JBIC, a government-backed financial institution for foreign aid loans and financing projects overseas, will be able to invest in and extend loans for the construction of military housing on Guam and other related costs.
Tokyo has agreed to provide the $6.09 billion through investment and loans as well as $2.8 billion in direct fiscal spending.