The Marshall Islands says it may appeal directly to the U.S. Congress if difficulties over a new Compact of Free Association can't be resolved.
The chief Marshalls compact negotiator, Robert Muller, says the two sides are not too far apart on the money required for base grants and the trust fund.
And, he says an agreement has been reached on retaining Federal postal services but not on Federal disaster assistance programmes.
Mr Muller says the U.S. Federal Emergency Management agency is attempting to transfer responsibility for disasters to US AID which only offers limited relief.
"We think that the US might reconsider their position on cutting back especially the federal rehabilitation or dissaster assistance program. If not, then we will probably oppose congress directly, to help us in this regard,."
Mr Muller says the Marshall Islands is now asking for 36.6 million U.S. dollars annually in base grants over 20 years while the U.S. is offering 33.9 million.
And, he says they've requested 11 million dollars a year for the trust fund but the U.S. has offered 7 million.
Guaranteed U.S. funding for the Marshall Islands under the present compact expires next year.