Palau's returning president Tommy Remengesau Jr will be sworn in on January 19 in an elaborate ceremony budgeted at $US200,000.
Members of the Senate have questioned the cost of the ceremony in which the inauguration of 29 National Congress members will also take place.
Mr Remengesau originally requested $US250,000 and defended the amount saying part of it was stimulus for the islands of Peleliu and Babeldaob where a tour will be conducted as part of the inauguration activities.
He said it is an opportunity to give the island a face-lift , and help rid it of breeding grounds for mosquitoes carrying dengue and zika.
In 2012, Mr Remengesau opted for a low-key inauguration to focus on disaster relief from Typhoon Bopha.
The Federated States of Micronesia President Peter Christian and Republic of the Marshall Island President Hilda Heine are among the 43 foreign guests attending.