The U.S.-operated Regional Military Training Center in Honduras, a key part of the Reagan administration's effort to modernize friendly Central American armies, will lose $18.5 million in U.S. aid on March 15 if the Hondurans do not agree to let soldiers from El Salvador to be trained at the facility.
March 15 also is the deadline by which Honduras could lose $72.5 million in U.S. security assistance if there is no agreement on demands by the U.S. Treasury Department for changes in Honduras' economic policy.
"It's use-it-or-lose-it time," a senior congressional aide said.
Talks on the two funds have been under way since August, when Honduras and the United States set out to redefine their relationship at Honduras' request.
Although in theory there is no overlapping between the two issues, in practice they are thoroughly entangled with the future of the "contras," U.S.-backed rebels fighting the Nicaraguan government from bases in Honduras.
The U.S. desire to keep the rebels operating gives the Hondurans considerable leverage, as does the U.S. interest in expanding the regional training center. But Honduras desperately needs the economic aid. There has been little progress in the discussions, according to officials close to them.
Congress, in a 1984 supplemental appropriation bill, technically gave the State Department until March 31 to obligate the money in both funds. But the department must notify Congress by March 15 if it wants to spend the money elsewhere, effectively making that the deadline.
Some arrangement on the security assistance, called economic support funds, is considered more likely than on the training center, which involves longstanding hostility between Honduras and El Salvador.
The two nations fought a brief war in 1969 in a border dispute that has not been settled, and Honduras has become increasingly nervous over the rapid growth and modernization of the Salvadoran army with U.S. aid.
The United States set up the training center at Puerta Castillo in 1983, in part because of congressional reluctance to give military aid to El Salvador and in part to avoid the cost of bringing Salvadoran soldiers to the United States for training. The goal eventually was to convert the wooden huts and scattered targets into a permanent facility serving the region that would be owned by Honduras and staffed by U.S. training personnel.
About 5,000 Salvadorans and 3,000 Hondurans had taken leadership instruction courses by last September, when Honduras insisted that no more Salvadorans be trained there. Only Hondurans have attended the sessions since.
In appropriating $18 million for the center for fiscal 1985, Congress set three conditions and made them retroactive to the $18.5 million it allocated in a supplemental appropriation for fiscal 1984. Also, $2 million intended for schools at the Panama Canal Zone is expected to be diverted to the Honduras facility, for a two-year total of $38.5 million, according to State Department officials.
None of the funds, however, will be allocated if the conditions are not met.
In addition to training troops from friendly countries in the region, Honduras must clear the site of land claims and must settle the claim of Temistocles Ramirez, a U.S. citizen who said he was not compensated when the center was established in 1983.
A U.S. court has ruled in Ramirez's favor; the Honduran government has appealed.
U.S. conditions on the $72.5 million in security assistance -- economic support funds -- have been imposed by the Treasury Department, not Congress. Concerned about Honduras' crumbling economy, the administration has asked the country to take number of belt-tightening actions, including currency devaluation, that the Hondurans have refused to do.
"We believe the program we have proposed for our economy is a good one, a strong one," said Moises Starkman, an adviser to Honduran President Roberto Suazo Cordova, "but it hasn't satisfied the people here. What they want would cause us more problems, and we won't accept it."
However, he emphasized that talks continue and said he expects a successful conclusion. "We aren't worried. We think we will have an agreement," he said.