Amicus Curiae Brief — Cherokee Nation of Okla. v. Leavitt

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IN THE

Suprene Court of the United States

CHEROKEE NATION AND SHOSHONE-PAIUTE

TRIBES OF THE DUCK VALLEY RESERVATION,

Petitioners,

UNITED STATES OF AMERICA; TOMMY G. THOMPSON,

SECRETARY OF THE UNITED STATES DEPARTMENT OF

HEALTH AND HUMAN SERVICES, et al.,

Respondents,

TOMMY G. THOMPSON,

SECRETARY OF HEALTH AND HUMAN SERVICES,

Petitioner,

CHEROKEE NATION OF OKLAHOMA,

Respondent.

ON WRITS OF CERTIORARI TO THE UNITED STATES

COURTS OF APPEALS FOR THE TENTH CIRCUIT

AND FOR THE FEDERAL CIRCUIT

BRIEF AMICUS CURIAE OF THE

NATIONAL CONGRESS OF AMERICAN INDIANS

SUPPORTING THE CHEROKEE NATION

AND SHOSHONE-PAIUTE TRIBES

JOHN DOSSETT EDWARD C. DUMONT

GENERAL COUNSEL Counsel of Record

NATIONAL CONGRESS OF WILMER CUTLER PICKERING

AMERICAN INDIANS HALE AND DORR LLP

1301 Connecticut Ave.,N.W. 2445 M Street, N.W.

Suite 200 Washington, DC 20037

Washington, DC 20036 (202) 663-6000

TABLE OF CONTENTS

ee Oe RD Ce ee crccssensenincsnccansesecsrsasestmncinietnes

SUMMARY OF ARGUMENT. ............-ccccscsssssssssssessssessessesosenees

I. THE ISDA WAS ENACTED IN 1975 To FuR-

THER A NEW NATIONAL POLICY OF TRIBAL

THE ISDA’s UNUSUAL HISTORY DEMON-

STRATES THAT CONGRESS PROGRESSIVELY

CONSTRAINED SECRETARIAL DISCRETION IN

AN EFFORT TO COMPEL PROPER IMPLEMEN-

Se Wee Be cccnnnicmntintemmnnnnns t

A. In Its First Review Of The ISDA’s Im-

plementation, Congress Concluded That

The Secretaries Had Maintained Exces-

sive Federal Administration, While Failing

To Reimburse Tribes For The Indirect

Costs Of Administering Federal Opera-

Ee aE

The 1988 Amendments Cut Back Sharply

Administration And Funding Of ISDA

I ccccsennccseneeiienvisienssmnsiinitanmnninnstiniemannn Th

1. Distinguishing Between Tribal And

Federal Administrative Costs............0-000-0000- Ll

Eliminating Unnecessary Federal

Administrative Requirements ...................-.. 13

Contract Enforcement...........cz...z0002000c00cessessesseere 1D

ili

TABLE OF CONTENTS—Continued : TABLE OF AUTHORITIES

— CASES

C. The 1994 Amendments Reflect Congress’s Page(s)

Final Decision To Eliminate Executive ee |

Discretion With Respect To ISDA Con- “a See eGh een. = Bureau of as

CEMCED ..0ccccccscccccccccssscccscssssssnensnesocsssossssnesssssononsasssooneseess Ramah Navajo School Board, Inc. v. Babt tt,

III. IN LIGHT OF THE ISDA’s HISTORY, ITS FUND- 87 F.3d 1338 (1996)........cssessvessven 22

ING PROVISIONS CANNOT BE CONSTRUED TO United States v. Lara, 124 S. Ct. 1628 (2004) 4

MAKE REIMBURSEMENT OF TRIBAL CON-

TRACT SUPPORT COSTS DEPEND ON THE SEC- STATUTES

RETARY’S DISCRETIONARY DECISIONS CON- Indian Self-Determination and Education Assis-

CERNING THE FUNDING OF FEDERAL ADMIN- tance Act of 1975, Pub. L. No. 93-638, 88 Stat.

SUTRA TIVE CODD cecesesescscsescsnssscscnsessosemmesnciatessamemssatininians 21 SIDED wasensescssennsnemnstnansenmemimmnatianniasiatiiaimass 5

A. The Governmental Nature Of ISDA Con- ‘aa - -

tracts Does Not Undermine Their En- § 105, 88 Stat. 208... enix . , g

Pe OBRITTIY ooccccccessscssccescsecsonssnesossstenesssesoesnsseossosnsnsensess 22 § 106(a), 88 Stat. 2210........ a : 6.9

B. Congress Did Not Give Federal Adminis- © RD, Ge Bae ccnisercssseensiineninecnnnsstiticltenenain 6, 11,14

trators Discretion To Determine When § 107(a), 88 Stat. 2212.00... e 6

Funds Are “Available” To Pay 6 + ne 23 § 108, 88 Stat. 2212...... , . 6, 18

C. In The Absence Of Specific Congressional Se ie ee Soe 4

Action, The Risk Of A Shortfall In Overall 100-472, 102 am. ones . , - L. No.

aes vee evsnsesnessennecennegssenssssssssecesacess 7

Appropriations Should Be Borne By The

Secretaries, Not By Tribes 25, § 102, 102 Stat. 2285.............0000 12

DG § 103, 102 Stat. 2286... " 13

CIE IN ccccccnscsccnsecenssncestsesssenssssernsinmemmmeninantta 28 § 104, 102 Stat. 2287........... . . 14

§ 201, 102 Stat. 2288.............. 12

PPP TITII EE, cancsccsescsscssscccsscesrscecsccessarsnsetnasneininmnassiamnmanmeninn la § 204, 102 Stat. 2291... :9

§ 205, 102 Stat. 2292... 14, 15

§ 206, 102 Stat. 2294..... oe a. 16

§ 207, 102 Stat. 2295........ 14,17

§ 208, 102 Stat. 2296 : 14, 18

102 Stat. 2298 legis. hist. note .. 8

Indian Self-Determination Contract Reform Act of

1994, Pub. L. No. 103-413, 108 Stat. 4250 18

§ 101, 108 Stat. 4251 18

§ 102, 108 Stat. 4257 . 19, 20

§ 103, 108 Stat. 4260 20

TABLE OF AUTHORITIES—Continued

Page(s)

§ 104, 108 Stat. 42G8.........ccccccersccessccecsecsvsesseresseresesesssesssoess 20

§ 106, 108 Stat. 4269..........c0c.ccccssrcsssccserensesesecsererssensssssseoees 21

BB U.S.C. 8 GGO1 a) ...0.cccccecseesesecsscrececescsscesesssssnsscsscsssscsscsscsossoosooenss 5

2B U.S.C. $ 45a a) .....ccccccsecseseesseeesesseseesccssccsscsecscsessesscsssocssssessoses 5

; US tee 7 |) 3, 12, 20, 26

BB U.S.C. 8 ABBR) 2.nccececccecescesscsecescserscescsccsssscscssssssscseosseeses 19, 20

CE Ul 20, 26

, LS Cee fe 6

25 U.S.C. $ 450 j(a).......c.cececccccscsereseresesscseserernessesensssosesosssssosssesess 13

2B U.S.C. § 45D }-1 ....0.ccecceceescresessesesscscssvseseosssenscscsssssssssesoees 1,3, 14

25 U.S.C. § 450j-1( a) ......0..0.cecccrecrececsererensesecserecsnserssssssoees 3, 14, 18

25 U.S.C. § 450j-1(0) .........cereccscscrsrerssserencerensesensesensssssesssees passim

25 U.S.C. § 450}-10C) ......c.cecccsecersercrererevsereserensererenssenssssssssssnseoees 27

BB U B.C. 8 GGG, .n.ccceccccececessecsecscescsscsccscsccscnscsscscssnsnsssssnecsenes 13, 21

2B U.S.C. § 45 c(B).......cceccccseseescseesessesessesecscsecsccscsenscsonscssssoososees 14

25 U.S.C. § 4501(c), SeC. 1(&)(2)......cceccecseereerserseserseneennennenes 20, 25

, RUS Ceo FS 16

25 U.S.C. § 450m-1( a) ........0.00.ceecrccscrerscsenseesereseesseees 20, 23, 26, 27

25 U.S.C. § 450m -1(d) .....0.00.0csccereceesscsecsessoressesensersnsersssenssssessnses 23

BI UBC. § 1906 ....cccocccscsccsccccssece oon — 27

Contract Disputes Act, 41 U.S.C. §§ 601 et seq. eumessmannssesem 16

I —_———————————————————————— 28

LEGISLATIVE MATERIALS

H.R. Conf. Rep. No. 103-740 (1994)... : scsmmmmmeuscsnsenans 24

S. Rep. No. 100-274 (1988) .........ccseeeees —————

S. Rep. No. 103-374 (1994) ... 17, 18, 20, 21

Indian Self-Determination and Education Assis-

tance Act Amendments of 1987: Hearing on

S. 1703 Before the Senate Select Committee on

Indian Affairs, 100th Cong. (Sept. 21, 1987) ............. 7,11

Indian Self-Determination and Education Assis-

tance Act, Public Law 93-638: Hearings Before

the Senate Select Committee on Indian Affairs,

100th Cong. (Apr. 22, 1987)..........ssesesssensnssnseennsesnennneees 7

134 Cong. Rec. 12860 (1988) . sroapeenenagnemnmmsmmvensncnsensmanes 8

TABLE OF AUTHORITIES—Continued

Page(s)

134 Cong. Rec. 23335 (1988) ..... = 8

134 Cong. Rec. 24038 (1988) 8

59 Fed. Reg. 3167 (Jan. 20, 1994) .19

1988 U.S.C.C.A.N. 2620... 8

MISCELLANEOUS

Felix S. Cohen, Felix S. Cohen’s Handbook of Fed-

eral Indian Law (1982) 4,5

General Accounting Office, 3 Principles of Federal

Appropriations Law (2d ed. 1994)..... 28

Special Message to Congress on Indian Affairs,

1970 Pub. Papers 564 (July 8, 1970) 4

Amicus the National Congress of American Indians re-

spectfully submits this brief supporting affirmance of the

judgment of the Federal Circuit in No. 03-853, and reversal

of the judgment of the Tenth Circuit in No. 02-1472.'

INTEREST OF AMICUS

The National Congress of American Indians (NCAI)

was founded in 1944 and is the oldest and largest tribal gov-

ernment organization in the United States. NCAI serves as

a forum for consensus-based policy development among its

membership of over 250 tribal governments from every re-

gion of the country. NCAI’s mission is to inform the public

and all branches of the federal government about tribal self-

government, treaty rights, and a broad range of federal pol-

icy issues affecting tribal governments. NCAI and its mem-

bers have considerable experience with the history and op-

eration of self-determination contracts under the Indian

Self-Determination and Education Assistance Act of 1975

(ISDA), 25 U.S.C. §§ 450 et seg. NCAI submits this brief in

order to help the Court understand the questions presented

in a broader context framed by the unusual history of the

ISDA, and the national policy of tribal self-determination.

SUMMARY OF ARGUMENT

These cases require construction of the funding provi-

sion of the Indian Self-Determination and Education Assis-

tance Act, 25 U.S.C. § 450j-1. All agree that contracts the

Secretary entered into with petitioners the Cherokee Nation

and the Shoshone Paiute Tribes under that Act call, on the

face of things, for the payment of “contract support costs”

(CSCs) in amounts greater than the Secretary has yet paid.’

' No counsel for a party authored this brief in whole or in part, and

no person or entity other than NCAI, its members or its counsel made any

monetary contribution to the preparation or submission of this brief. Let-

ters indicating the parties’ consent to the filing of this brief have been

submitted to the Clerk.

* Although the Cherokee Nation is the respondent in No. 03-853, for

simplicity we refer to both Tribes as petitioners.

The Secretary argues that he has no obligation to pay the

additional amounts because the ISDA provides that contract

funding “is subject to the availability of appropriations.” 25

U.S.C. § 450j-1(b). As the Tribes’ brief demonstrates, how-

ever, funds sufficient to pay the costs at issue in these cases

were “available” within the ordinary meaning of that term

as a matter of federal contracting and appropriations law.

The Secretary’s core argument is instead that the necessary

appropriations were “not meaningfully ‘available’ to pay

contract support costs.” 03-853 Pet. 24 (emphasis added).

By this he evidently means that it would have been difficult

for him to fund full payment of petitioners’ CSCs without

either seeking more money from Congress, or cutting the

agency’s own budget in ways that he thinks would be “ab-

surd.” Jd. In addition, the Secretary now seeks to rely on

statutory language providing that “the Secretary is not re-

quired to reduce funding for programs, projects, or activities

serving a tribe to make funds available to another tribe un-

der [the ISDA).” 25 U.S.C. § 450j-1(b).

Faced with such arguments, this Court might at first be

inclined to defer to the interpretations and judgment of a

federal Officer who has been charged by Congress with par-

tial responsibility for administering the ISDA. In this case,

that would be a perverse mistake. The ISDA is a corner-

stone of the national policy of tribal self-determination, and

is intended to transfer the responsibility and resources for

operating federal Indian programs from federal agencies to

tribal governments. Tracing the history of the ISDA from

its enactment in 1975 through substantial amendments in

1988 and 1994 shows the unusual evolution of a statute under

which Congress has repeatedly stripped the implementing

federal agencies of discretion, largely because of Congress’s

conclusion that the agencies were protecting their own bu-

reaucracies, rather than devoting available funds to advanc-

ing the goals of the ISDA. In particular, the history shows

that Congress intended to place the Secretary under the

strongest possible obligation to fully fund contract support

costs—without measurable discretion, and even at the ex-

pense of the agency’s own internal operations. And Con-

gress consciously chose to make the Secretary’s obligations

to ISDA Tribes enforceable against the agency to ¥ least

the same extent as other government contracts.

Against this backdrop, the only reasonable a i

this case is for the Court to cohen op ran

and the ISDA, in accordance with their terms. Congress did

not give the Secretary discretion to determine when funds

are “available” to satisfy ISDA obligations. As between the

Secretary and an ISDA Tribe, Congress placed the risk of

any overall budgetary shortfall l

moe squarely on the Secretary—

ARGUMENT

Through the ISDA, Congress has “directed” the Secre-

tary to enter into a self-determination contract with any

qualified Tribe that wishes to assume direct operation of a

federal program that would otherwise be administered by

the Secretary for the benefit of the Tribe and its members

25 U.S.C. § 450f(a)(1). As amended in 1988 and 1994, the Act

imposes very specific requirements concerning the funding

that the Secretary must provide under such contracts. Id.

§ 450j-1. In particular, the funding must include an amount

to cover “contract support costs,” and “shall not be reduced

by the Secretary to pay for Federal functions.” j

wheat nections.” Id. § 450j-

These requirements are qualified by two provisos:

provision of funds is “subject to the availability of ves

tions,” and “the Secretary is not required to reduce funding

for programs, projects, or activities serving a tribe to make

funds available to another tribe or tribal organization under

[the ISDA].” Id. § 450j-1(b). The Secretary has argued that

what funds are to be deemed “availabfle],” or what would

cause a “reduc[tion}” in direct service, for purposes of Sec-

tion 450j-1(b), must be left essentially to his discretion,

site , pe need pod flexibility in setting spending

es for his : 03-853 . 17- ;

1472 Br. in Opp. 1617, Ste sips

Because that argument may have a superficial plausibil-

ity, it is important for the Court to understand both the gen-

eral policy of tribal self-determination that gave rise to the

ISDA, and the very specific and unusual history of Con-

gress’s repeated efforts to reduce or eliminate agency dis-

cretion—in particular, discretion to pay for “Federal func-

tions” rather than tribal contract support costs—and to

compel faithful implementation of the Act. Against that

background, it is clear that no argument based on secretarial

discretion can provide a sound basis for construing the

ISDA.

I. THe ISDA Was ENACTED IN 1975 TO FURTHER A NEW

NATIONAL POLICY OF TRIBAL SELF-DETERMINATION.

As this Court is well aware, federal policy concerning

relations with the Indian Tribes has passed through many

phases over time. See, e.g., United States v. Lara, 124 S. Ct.

1628, 1634-1635 (2004). The important point for present

purposes is that when the ISDA was enacted in 1975, it em-

bodied a radical change in previous policies that had re-

flected at best an enervating federal paternalism, and at

worst an express policy of terminating the legal recognition

of tribal identity. In a landmark message to Congress in

1970, President Nixon called for a new approach, “explicitly

affirm[ing] the integrity and right to continued existence of

all Indian tribes.” Under the new regime, the United

States would reaffirm its responsibility to Indian peoples,

but it would increasingly seek to discharge that responsibil-

ity by rebuilding tribal leadership and institutions and pur-

suing government-to-government relationships with the

Tribes. See id. at 1634; Ramah Navajo Sch. Bd., Inc. v. Bu-

reau of Revenue, 458 U.S. 832, 840 (1982) (“in the early

1970’s the federal policy shifted toward encouraging the de-

velopment of Indian-controlled institutions on the reserva-

’ Special Message to Congress on Indian Affairs, 1970 Pub. Papers

564, 567 (July &, 1970); see also, e.g., Felix S. Cohen, Felix S. Cohen's

Handbook of Federal Indian Law 180-206 (1982).

tion”). This philosophy of tribal self-determination has pro-

vided the basis for federal Indian policy for the last 30 years.

The self-determination policy found concrete expression

in a number of new federal statutes—“most notably” the

ISDA. Ramah, 458 U.S. at 840.‘ In enacting the ISDA in

1975, Congress found that:

(Tjhe prolonged Federal domination of Indian ser-

vice programs has served to retard rather than en-

hance the progress of Indian people and their com-

munities by depriving Indians of the full opportu-

nity to develop leadership skills crucial to the reali-

zation of self-government, and has denied to the In-

dian people an effective voice in the planning and

implementation of programs for the benefit of Indi-

ans which are responsive to the true needs of In-

dian communities[.]

Pub. L. No. 93-638, 88 Stat. 2203, § 2(a)(1), codified at 25

US.C. § 450(a)(1). It recognized the “obligation of the

United States to ... assur[e] maximum Indian participation

in the direction of ... Federal services to Indian communi-

ties so as to render such services more responsive to the

needs and desires of those communities.” Jd. § 3(a), 25

U.S.C. § 450a(a). And it

declare[d] its commitment to ... the establishment

of a meaningful Indian self-determination policy

which will permit an orderly transition from Fed-

eral domination of programs for and services to In-

dians to effective and meaningful participation by

* See also Cohen, supra, at 188-204 (discussing the ISDA and other

“Self-Determination Era” statutes, such as the Indian Civil Rights Act of

1968, 25 U.S.C. §§ 1301-1341; the Indian Financing Act of 1974, 25 U.S.C.

§ 1451; and the Indian Child Welfare Act of 1978, 25 U.S.C. $$ 1901-1963).

the Indian people in the planning, conduct, and ad-

ministration of those programs and services.

Id. § 3(b), 25 U.S.C. § 450a note; App. la.”

To give these goals practical form, Congress “directed”

the Secretaries of the Interior and of Health, Education, and

Welfare “to enter into a [self-determination] contract or con-

tracts” with any qualified Tribe that so requested. /d.

§§ 102-103, 88 Stat. 2206-2207; see App. la. These contracts

were designed to transfer to the Tribe the responsibility and

resources “to plan, conduct, and administer [federal] pro-

grams” that would otherwise be provided for Indians by the

Secretaries, either directly or through similar contracts with

States or state agencies. /d.

In keeping with this purpose, the Act included exten-

sive provisions to facilitate the transfer of federal personnel

to tribal supervision or employment. /d. § 105, 88 Stat. 2208-

2210; see 25 U.S.C. § 450i & codification note. As to funding,

it provided that the amount paid under each contract “shall

not be less than the appropriate Secretary would have oth-

erwise provided for his direct operation of the programs or

portions thereof” covered by a contract. ISDA § 106(h), 88

Stat. 2211-2221; App. 3a. And as to administration, the Act

generally gave the relevant Secretaries the usual broad dis-

cretion to determine how best to effectuate Congress’s

goals. See id. § 107(a), 88 Stat. 2212 (subject to certain con-

sultation requirements and time limits, Secretaries “are each

authorized to perform any and all acts and to make such

rules and regulations as may be necessary and proper for the

purposes of carrying out the provisions of this title”).°

* For the Court’s convenience, we have reprinted in an appendix to

this brief selected provisions of the ISDA, as originally enacted and then

as amended in 1988 and 1994.

® See also, e.g., id. § 106(a), 88 Stat. 2210 (contracts to be “in accor-

dance with all Federal contracting laws and regulations except that ...

the appropriate Secretary may waive any provisions ... which he deter-

mines are not appropriate for the purposes of the contract involved or

inconsistent with the provisions of this Act”), id. § 108, 88 Stat. 2212 (con-

It is important to emphasize that nothing in the ISDA

was intended to transfer the ultivnate responsibility for fund-

ing contracted programs from the federal government to the

Tribes. These were still federal programs. What the ISDA

aimed to change was the way that these federal programs

were administered. It was a direction to the federal agen-

cies that had been running them to turn their operation

over, on request, to tribal governments—thus, necessarily,

pro tanto reducing the agencies’ own operations. Perhaps

not surprisingly, that policy turned out to be more easily ar-

ticulated than enforced.

Il. THE ISDA’s UNUSUAL HISTORY DEMONSTRATES THAT

CONGRESS PROGRESSIVELY CONSTRAINED SECRETARIAL

DISCRETION IN AN EFFORT TO COMPEL PROPER IMPLE-

MENTATION OF THE ACT

A. In Its First Review Of The ISDA’s Implementa-

tion, Congress Concluded That The Secretaries

Had Maintained Excessive Federal Administra-

tion, While Failing To Reimburse Tribes For The

Indirect Costs Of Administering Federal Opera-

A dozen years after the initial enactment of the ISDA,

Congress undertook a “comprehensive reexamination” of the .

Act. S. Rep. No. 100-274, at 1 (1988 Rep.).’ That careful re-

view of how the relevant Secretaries had implemented the

statute during its first decade led to a number of pointed re-

visions to the legislation. Indian Self-Determination and

Education Assistance Act Amendments of 1988, Pub. L. No.

100-472, 102 Stat. 2285 (1988 Amendments); see App. 4a-1 la.

tracting Tribes to submit annual report including “such other information

as the appropriate Secretary may request”).

” See also Indian Self-Determination and Education Assistance Act

Amendments of 1987: Hearing on S. 1703 Before the Senate Select Comm.

on Indian Affairs, 100th Cong. (Sept. 21, 1987) (S. 1703 Hrg.); Indian Self-

Determination and Education Assistance Act, Public Law 93-638: Hear-

i the Senate Select Comm. on Indian Affairs, 100th Cong. (Apr.

The Senate Report addressing the 1988 Amendments

first noted that the ISDA was intended “to assure maximum

participation by Indian Tribes in the planning and admini-

stration of federal services, programs and activities for In-

dian communities.” 1988 Rep. 1. While it praised the “re-

markable progress” that Tribes and the relevant agencies

had made toward that goal (id. at 6; see id. at 4-6), the Com-

mittee recognized that there had been significant problems

with implementation of the Act (id. at 6-8).

To put these problems in proper context, the Committee

recalled a sticking point that President Nixon had identified

when he first called for a renewed self-determination policy:

Before the ISDA, “when a decision [was] made as to whe-

ther a Federal program [would] be turned over to Indian

administration, it [was] the Federal authorities, and not the

Indian people who finally ma{dJe that decision.” 1988 Rep. 3

(quoting [1970] Pub. Papers at 567). To reverse that histori-

cal reality, the ISDA had “uniquely require[{d}” the relevant

Secretaries to “transfer resources and control over [federal]

programs to [requesting] tribe[s].” Jd. at 6. There was, the

Committee noted, “no other example of a Secretary being

required to transfer resources to assist another governmen-

tal entity and simultaneously to divest itself of its own re-

sources.” Jd. This already unusual situation had been exac-

erbated by “difficult federal budget pressures,” under which

“federal agencies and tribes ha{d] been competing for the

same federal funds to carry out their respective responsibili-

ties.” Jd. at 7.

Against this background, the Committee stressed that

when Congress passed the ISDA, it “envisioned a clear-cut

*The 198% amendments originated in the House of Representatives

as H.R. 1223. The Senate Report addressed a companion bill, S. 1703. The

Senate ultimately passed the House bill after amending it to conform in

large part to the Senate bill. 134 Cong. Rec. 12860-12862 (1988). The

House concurred in part in the Senate amendments, and the Senate ac-

cepted the House’s changes. 134 Cong. Rec. 23335-23341, 24038-24043

(1988); see 102 Stat. 229% legis. hist. note; 1988 U.S.C.C.A.N. 2620.

transfer [to Tribes] of federal responsibilities as well as fed-

eral financial, administrative, technical and other resources.”

1988 Rep. 6. Looking back over the previous decade, how-

sey nv pee identified two principal obstacles that

nterfered with the contractual relationshi -

plated by the Act.” Jd. at 7. o_o

. First, although ISDA gave each Secre the discre-

tion to waive the application of federal wero Peat

regulations, see 88 Stat. 2210 (§ 106(a)); App. 2a, the Com-

mittee observed that instead the Secretaries’ “{nappropriate

application of federal procurement laws and federal acquisi-

tion regulations to self-determination contracts ha[d] re-

sulted in excessive paperwork and unduly burdensome re-

porting requirements.” 1988 Rep. 7. This both unduly in-

creased the cost of transferring functions under the Act (see

id. at 7-8, 9), and meant that “(t]he federal service bureauc-

racy that was supposed to be reduced as tribes assumed con-

trol of programs [had instead] been replaced by a contract

monitoring bureaucracy” (id. at 7). The Secretaries’ decision

to support this continued agency involvement led in turn to

‘budgetary allocations to cover federal pay costs, retirement

costs and other federal needs,” which reduced the funds

available to the Tribes for the federal functions they had

contracted to discharge, and “inject{ed] uncertainty into the

planning and management of tribal programs.” Id. at 8. In

other words, rather than exercising their discretion to

streamline the transfer of functions to tribal governments

the Secretaries had exercised it in a way that interfered

with that transfer, while perpetuating the ini

trative establishment. - 7 ahi eased

Second, the Committee identified “[plerhaps the single

most serious problem with implementation of the Indian

self-determination policy” as “the failure of the [Secretaries]

to provide funding for the indirect costs associated with self-

determination contracts.” 1988 Rep. 8; see id. at 8-13. The

Committee explained (id. at 8-9):

The consistent failure of federal i

nsistent agencies to full

fund tribal indirect costs has resulted in Pedi

management problems for tribes as they struggle to

pay for federally mandated annual single-agency

audits, liability insurance, financial management

systems, personnel systems, property management

and procurement systems and other administrative

requirements. Tribal funds derived from trust re-

sources, which are needed for community and eco-

nomic development, must instead be diverted to

pay for the indirect costs associated with programs

that are a federal responsibility.

In this regard, the Committee emphasized that under

self-determination contracts, Tribes were “operating federal

programs and carrying out federal responsibilities.” 1988

Rep. 9. They “should not be forced to use their own financial

resources to subsidize federal programs.” Id. Moreover, to

the extent that contracting with Tribes might entail addi-

tional administrative costs at the tribal level, the Committee

recognized that such expenditures, unlike money spent on

administration by federal agencies, directly served a “fun-

damental objective of the federal policy of Indian self-

determination,” which is “to increase the ability of tribal

governments to plan and deliver services appropriate to the

needs of tribal members.” /d. at 5; see id. at 4 (improvement

in tribal government administrative capabilities was fi-

nanced in part by “indirect cost reimbursement associated

with self-determination contracts”); id. at 11 (discussing re-

port by Interior Department’s Inspector General). Finally,

the Committee repeatedly faulted the Secretaries for

“failling] to request from Congress the full amount of funds

needed to fully fund indirect costs associated with self-

determination contracts.” Id. at 9; see id. at 12, 13.

In sum, the Committee expressed exasperation with the

way that the Secretaries had administered the largely dis-

cretionary funding provision in the original ISDA, which re-

quired only that contract funding be “not less than” the

amount a Secretary would have provided for his “direct

operation” of a program (88 Stat. 2211 (§ 106(h)); App. 3a):

The Federal Government would not consider it

proper to short-change funding for contracts with

private suppliers of goods and services. When the

Bureau of Indian Affairs and the Indian Health

Service contract with Indian tribes, however, they

routinely fail to reimburse tribes for legitimate ad-

ministrative costs associated with carrying out fed-

eral responsibilities. Full funding of tribal indirect

costs associated with self-determination contracts is

essential if the federal policy of Indian Self-

Determination is to succeed.

1988 Rep. 13.’ In response, it declared its intention to

amend the ISDA in a manner specifically designed “to re-

quire the [Secretaries] to comply with the requirement of

the Act that indirect costs be added to the amount of funds

available for direct program costs.” Jd. at 12.

B. The 1988 Amendments Cut Back Sharply

retarial Discretion Regarding The aaeaeme

And Funding Of ISDA Contracts

The 1988 Amendments themselves directly reflect Con-

gress's concern with the Secretaries’ (i) excessive preserva-

tion of a federal administrative structure and (ii) failure to

provide adequate funding for the indirect costs incurred by

Tribes in administering contracted federal operations.

* See also S. 1703 Hrg. 55 (statement of Chairman Inouye) (“

word about contracts: I am a member of the an

and there we deal with contracts all the time. Whenever the Department

of Defense gets into a contract with General Electric or Boeing or any one

of the other great organizations, that contract is carried out, even if it

means supplemental appropriations. But strangely in this trust relation-

ship with Indians they come to you maybe halfway or three quarters

through the fiscal year and say, ‘Sorry, boys, we don’t have the cash, so

we're going to stop right here’ after you've put up all the money.”).

1. Distinguishing Between Tribal And Federal

Administrative Costs

To begin with, the amendments added a new sentence

to the Act’s “declaration of policy”: “In accordance with this

policy [of self-determination], the United States is commit-

ted to supporting and assisting Indian tribes in the devel-

opment of strong and stable tribal governments, capable of

administering quality programs and developing the econo-

mies of their respective communities.” 1988 Amendments

§ 102, 102 Stat. 2285 (amending ISDA § 3(b), 25 U.S.C.

§ 450a(b); App. 4a). This newly articulated commitment re-

flects Congress’s express understanding that ISDA funds

spent on the indirect costs that tribal governments incur in

administering federal contracts directly serve the ISDA’s

purpose of enhancing tribal self-determination: The same

cannot, of course, be said of federal agencies’ administrative

costs.

Along the same lines, Congress consolidated what were

originally separate sections dealing with the Secretary of the

Interior and the Secretary of Health, Education, and Wel-

fare (by 1988, Health and Human Services). 1988 Amend-

ments § 201, 102 Stat. 2288 (amending ISDA § 102 and re-

pealing or redesignating § 103); App. 6a-7a. The two original

sections had used different wording to describe the scope of

an ISDA contract. Compare ISDA § 102(a), 88 Stat. 2206

(“to plan, conduct, and administer programs”), with id.

§ 103(a), 88 Stat. 2206-2207 (“to carry out any or all of his

functions, authorities, and responsibilities under the Act of

August 5, 1954,” which transferred Indian health programs

to the Public Health Service). In combining the two provi-

sions, Congress clarified and expanded the scope of “pro-

grams” potentially covered, and selected the “plan, conduct,

or administer” language to describe the nature of the con-

tracts. 1988 Amendments § 201, 102 Stat. 2288 (emphasis

added) (codified as later further amended at 25 U.S.C.

§ 450f(a)(1)); App. 6a. The Senate Committee explained its

intention to make clear that “administrative functions of the

Indian Health Service are contractible,” that the Secretaries

were “not to consider any program or portion thereof to be

exempt from self-determination contracts,” and that con-

tracted operations could include a wide range of administra-

tive tasks that would otherwise be performed by the agen-

cies at the “Area Office, Field Office, Agency and. Service

Unit” levels. 1988 Rep. 23-24. In short, Congress was fo-

cused on the transfer—not the preservation—of federal ad-

ministrative functions.

2. Eliminating Unnecessary Federal Adminis-

trative Requirements

The 1988 Amendments also struck at the Secretaries’

failure to use their authority to exempt ISDA contracts from

federal procurement procedures, and the corresponding fail-

ure to realize expected reductions in federal administrative

costs as operations were shifted to tribal administration. See

1988 Rep. 7. In amending the Act’s definitions, Congress

specified that “no contract entered into pursuant to this Act

shall be construed to be a procurement contract,” 1988

Amendments § 103, 102 Stat. 2286 (adding ISDA § 4(j)), in

order to “make[] clear . . . that the system of federal acquisi-

tion regulations ... should not apply to self-determination

contracts,” and in the hope that “the federal contract moni-

toring bureaucracy that has replaced the federal service bu-

reaucracy [would] be greatly reduced over the next three

years,” 1988 Rep. 18-19. Similarly, in the section addressing

contract administration, Congress added a proviso specifi-

cally directing that except for construction contracts, “the

Office of Federal Procurement Policy Act ... and Federal

acquisition regulations promulgated thereunder shall not

apply to self-determination contracts.” 1988 Amendments

§ 204, 102 Stat. 2291 (redesignating and amending ISDA

§ 105(a), codified as later further amended at 25 U.S.C.

§ 450j(a)).

In addition, in three places Congress mandated that any

federal administrative requirement for entering into or mon-

itoring ISDA contracts, including record-keeping and re-

porting requirements, must be promulgated through notice-

and-comment rulemaking. 1988 Amendments §§ 104, 207,

and 208, 102 Stat. 2287, 2295, 2296 (amending and redesig-

nating ISDA §§ 5, 107, and 108, codified as later further

amended at 25 U.S.C. §§ 450c, 450k, and 450c(f)); see App. 5a,

10a. As the Senate Committee explained at some length,

these amendments were intended in part “to prevent Fed-

eral agencies from imposing unnecessary contract compli-

ance and reporting requirements on tribal contractors

through the use of administrative policy directives,” internal

manuals, and the like. 1988 Rep. 20; see id. at 20-22, 39.

They also provided a framework and schedule for the Secre-

taries to cooperate with Tribes in developing appropriate

regulations to replace the cumbersome procurement rules

that the Secretaries had previously applied. Jd. at 38. The

Committee specifically noted its expectation that the new

regulations would be “relatively simple, straightforward,

and free of unnecessary requirements o{r] procedures.” /d.

The Act itself required that they be promulgated within 10

months. 1988 Amendments § 207(b), 102 Stat. 2295-2296

(amending ISDA § 107(b), codified as later further amended

at 25 U.S.C. § 450k(b)).

3. Contract Funding

As to the central question of contract funding, the 1988

Amendments replaced the original Act’s one-sentence sub-

section dealing with funding with a lengthy new section of

the Act, largely concerned with contract support costs. 1988

Amendments § 205, 102 Stat. 2292 (adding ISDA § 106, codi-

fied as later further amended at 25 U.S.C. § 450j-1); App. 8a-

9a. The original provision had merely specified that contract

funding must “not be less” than the relevant Secretary

would have spent on a contracted operation—essentially

leaving other funding questions to the relevant Secretary’s

discretion. ISDA § 106(h), 88 Stat. 2211.

In stark contrast, the new provision specifically recog-

nized that contracting Tribes would incur CSCs, and re-

quired that those costs “be added to” the base funding

amount. See 25 U.S.C. § 450j-1(a)(2). It further set out, in

remarkable detail, a number of grounds that a Secretary was

specifically prohibited from advancing as justifications for

reducing the contract funding provided to a Tribe. See

, 25

U.S.C. S 450}-1(b). These forbidden grounds included “mak-

[ing] funding available for contract monitoring or admini-

stration by the Secretary”; “payling] for Federal functions,

including, but not limited to, Federal pay costs, Federal em-

ployee retirement benefits, automated data processing, con-

tract technical assistance or contract monitoring”; and

“payling] for the costs of Federal personnel displaced by a

self-determination contract.” /d.

The amendments thus imposed strict statutory ibi-

tions against what had previously been treated as owl

allocations lying within the Secretaries’ discretion. They

also added several provisions addressing specific indirect-

cost issues, including requiring the Secretary to submit an

annual report to Congress that was to detail, among other

things, “any deficiency of funds needed to provide required

indirect costs to all contractors for [each] fiscal year.” See

1988 Amendments § 205, 102 Stat. 2293 (adding ISDA

§ 106(c)-(i), including § 106(c)(2), codified as later further

amended at 25 U.S.C. § 450j-1(c)-(i), including § 450j-1(c)(2)).

And they introduced the two limited qualifications at issue

here: “the provision of funds under this Act is subject to the

availability of appropriations,” and “the Secretary is not re-

quired to reduce funding for programs, projects, or activities

serving a tribe to make funds available to another tribe” un-

der the ISDA. 25 U.S.C. § 450j-1(b) (emphasis added).

As the Senate Report confirms, these ~hanges were in-

tended to “protect{] contract funding levels seule @

me pe reer + diversion of tribal contract funds tc

pay for i by the Federal x

seandsanen y government.” 1988

4. Contract Enforcement

___A final significant aspect of the 1988 Amendments here

is Congress’s approach to the question of contract enforce-

ment. The Senate Report indicates that the Committee:

considered deleting the term “contract” and using

another term such as “self-determination grant” or

“intergovernmental agreement.” Ultimately, how-

ever, the Committee determined that the use of the

term “contract” is important to convey the sense of

a legally binding instrument that cannot be termi-

nated by administrative action without the legal

consequences that would be associated with the ter-

mination of contractual obligations by either party.

1988 Rep. 19. Indeed, the 1988 Amendments reinforced the

contractual nature of ISDA funding, adding to the statute a

new section expressly providing for application of the Con-

tract Disputes Act, 41 U.S.C. §§ 601 et seq., and judicial en-

forcement in either district courts or what is now the Court

of Federal Claims. 1988 Amendments § 206, 102 Stat. 2294-

2295 (adding ISDA § 110, codified as later further amended

at 25 U.S.C. § 450m-1); App. lla.

These provisions substantially strengthened the reme-

dies available to ISDA Tribes. The Senate Committee made

clear that it believed they were “necessary to give self-

determination contractors viable remedies for compelling

BIA and IHS compliance with the [ISDA].” 1988 Rep. 37.

Indeed, the Committee put the point bluntly:

The strong remedies provided in these amendments

are required because of those agencies’ consistent

failures over the past decade to administer self-

determination contracts in conformity with the law.

Self-determination contractors’ rights under the

Act have been systematically violated particularly

in the area of funding indirect costs. Existing law

affords such contractors no effective remedy for re-

dressing such violations.

Id. It illustrated its discussion with an example involving

inadequate funding that, in the Committee’s view, was the

product “not ... of a Congressional appropriation shortfall,

but of a unilateral decision by the BIA” (id.)—that is, a deci-

sion the agency no doubt believed fell within its administra-

tive discretion.

In sum, the history and substance of the 1988 Amend-

ments demonstrate that Congress: (1) was frustrated by the

Secretaries’ tendency to perpetuate an und

istrative role under the ISDA: (2) peony ter

Secretary to pay for contract support costs, subject only to

the availability of appropriations and the no-reduction

clause; and (3) purposefully gave ISDA Tribes the right to

pursue powerful contract remedies. These amendments

substantially constrained the administrative discretion that

the Secretaries had previously exercised in implementing

the ISDA. They were, however, “necessary in order to meet

the challenge presented by the tribes: to fully support the

successful implementation of the federal policy of Indian

Self-Determination.” 1988 Rep. 13.

C. The 1994 Amendments Reflect Congress’ Final

Decision To Eliminate Executive Diseretion

Respect To ISDA Contracts oe

In 1994, Congress again reviewed the Secretaries’ per-

a in implementing the ISDA. It did not like what it

nd.

The 1994 Senate Report tersely recal -

mittee’s 1988 conclusion that the ISDA os hare a

its goal of reducing the federal bureaucracy and ending the

federal domination of Indian programs,” and had ietead

“spawned an increase in federal officials who were employed

to monitor self-determination contracts.” S. Rep. No. 103-

374, at 2 (1994) (1994 Rep.). The 1988 amendments had been

required because “the original goal of ensuring maximum

tribal participation in the planning and administration of

federal services” had been “undermined by excessive [fed-

a bureaucracy and unnecessary contract requirements.”

| In 1988, Congress had acted to “remove .. . admini

tive and practical barriers.” 1994 Rep. 2. The onlin

had expected new implementing regulations to be issued

quickly, and to be “relatively simple, straightforward, and

free of unnecessary requirements.” Jd. (internal quotation

marks omitted). Yet, despite the fact the statute (not just a

Committee report) required that those regulations be issued

within 10 months (see 1988 Amendments § 207, 102 Stat.

2296 (enacting ISDA § 107(b)(4))), the Secretaries had not

published even proposed regulations until January 20, 1994.

Moreover, those proposed rules contained “hundreds of new

requirements,” and were in many instances “more restric-

tive than existing regulations and raise[d] new obstacles and

burdens for Indian tribes.” 1994 Rep. 3 (internal quotation

marks omitted); see also id. at 14 (Secretaries “failled] . . . to

respond promptly and appropriately to the comprehensive

amendments developed by this Committee six years ago. ...

It is this unfortunate experience that is a major impetus for

this bill.”).

Congress’s reaction was unequivocal. Disregarding the

Executive’s “strong{] oppos[ition]” (1994 Rep. 16), it passed

a second extensive revision of the ISDA. Indian Self-Deter-

mination Contract Reform Act of 1994, Pub. L. No. 103-413,

tit. I, 108 Stat. 4250 (1994 Amendments); see App. 12a-20a.

The changes addressed familiar concerns, but with a new

unwillingness to entrust any part of their resolution to sec-

retarial discretion.

The original ISDA, for example, had required contract-

ing Tribes to submit annual reports including “such ... in-

formation as the appropriate Secretary may request.” ISDA

§ 108, 88 Stat. 2212; App. 3a. The 1988 Amendments at-

tempted to restrain the burdensomeness of such “re-

quest[s]” by requiring that they be made through public

rulemaking. 1988 Amendments § 208, 102 Stat. 2296; App.

5a. In 1994, Congress simply specified one particular form of

required audit. 1994 Amendments § 102(2), 108 Stat. 4250-

4251 (codified at 25 U.S.C. § 450ce(f)); App. 12a. Beyond that,

the Secretary may collect additional information only to the

extent he is able to “negotiate” such a requirement with the

tribal contractor. /d.

Similarly, the 1988 Senate Report had indicated an in-

tent that the Secretaries accept tribal proposals to contract

for administrative functions, no matter at what organiza-

tional level the Secretary would have performed them. 1988

Rep. 23-24. The 1994 Amendments spelled the requirement

out in statutory text—indeed, in two key places. See 25

19.

U.S.C. § 450f(a)(1), as amended by 1994 Amendments

§ 101(5), 108 Stat. 4251 (“The programs, functions, services

or activities that are contracted . .. shall include administra-

tive functions ... without regard to the organizational level

within the [federal] Department that carries out such func-

tions.”) (App. 13a); 25 U.S.C. § 450j-1(a)(1), as amended by

1994 Amendments § 102(14), 108 Stat. 4257 (contract funding

“shall not be less than the ... Secretary would have otlier-

wise provided for the [contracted] operation ... without re-

gard to any organization level within the [federal] Depart-

ment ve at which the [operation]... , including supportive

administrative functions that are otherwise contractable, is

operated”) (App. 16a).'°

The 1994 Amendments also substantially tightened di-

rect statutory control over the standards and process under

which the Secretary may decline to enter into an ISDA con-

tract proposed by a Tribe. See 1994 Amendments § 102(6)-

(7) and (9), 108 Stat. 4251-4253 (amending or adding ISDA

§ 102(a)(2) and (4), (b)(3), and (e), codified as later further

amended at 25 U.S.C. § 450f(a)(2) and (4), (b)(3), and (e));

App. 18a-15a. For example, the amended Act now requires

the Secretary to base any such decision on “controlling legal

- These amendments addressed a particular source of frustration for

Tribes seeking to contract for services: the practice of contracting only

field-office operations, thereby protecting federal agency area-office and

headquarters operations. Despite forceful discussion in the 1988 Senate

Report specifically indicating that Tribes should be able to contract to

perform all IHS functions related to a program, including functions- per-

formed at area offices and headquarters, see 1988 Rep. 23-24, the 1994 pro-

posed regulations threatened to reinforce the historical practice. They

defined the operative term “program” narrowly as the “operation of ser-

vices for tribal members and other eligible beneficiaries,” and asserted

that “the legislative history ... indicates that what Congress intended by

the term program was the operation of services.” 59 Fed. Reg. 3167 (Jan.

20, 1994); see id. at 3179, § 900.102. Although the regulations left open the

theoretical possibility that some programs “might be performed at higher

organizational levels,” they “emphasize[d] that service delivery programs

subject to contracting are generally performed at the reservation level.”

Id. at 3168; see id. at 3181, § 900.106(c).

authority” or on specific evidence “clearly” demonstrating a

statutory ground for declination; to approve any severable

portion of a proposal; and to carry “the burden of proof to

establish by clearly demonstrating the validity of the

grounds for declining.” 25 U.S.C. § 450f(a)(2) & (4), (e)(1).

Moreover, if a Tribe’s contract proposal is declined in whole

or in part—or if, as had happened in the past, the Secretary

purports to approve a request, but then does not take the

steps necessary to implement the contract—the Tribe may

bypass any administrative appeal and proceed straight to

district court, seeking “immediate injunctive relief to re-

verse a declination finding ... or to compel the Secretary to

award and fund an approved self-determination contract.”

25 U.S.C. §§ 450f(b)(3) and 450m-1(a), as amended by the

1994 Amendments §§ 102(7) & 104(2), 108 Stat. 4252, 4268;

App. 14a, 18a. ‘

Perhaps most strikingly, Congress gave up waiting for

the Secretaries to promulgate appropriate terms and condi-

tions for ISDA contracts, and simply prescribed a statutory

form of contract itself. See 1994 Amendments § 103, 108

Stat. 4260-4261 (enacting ISDA § 108, codified as later fur-

ther amended at 25 U.S.C. § 4501); see also 1994 Rep. 3. In

that prescribed form, it included a special and sweeping rule

of construction:

Each provision of the Indian Self-Determination

and Education Assistance Act (25 U.S.C. 450 et

seq.) and each provision of this Contract shall be

liberally construed for the benefit of the Contractor

to transfer the funding and the ... related func-

tions, services, activities, and programs (or portions

thereof) [listed in the Contract], that are otherwise

contractable under section 102(a) of such Act [25

U.S.C. § 450f(a)], including all related administra-

tive functions, from the Federal Government to the

Contractor|.]

25 U.S.C. § 4501(c), sec. 1(a)(2) (emphasis added). Moreover,

having settled these. matters itself, Congress expressly

stripped the Secretaries of any authority to “promulgate any

regulation, [or] impose any nonregulatory requirement, re-

lating to self-determination contracts”—with the exception

of one unified set of regulations, addressing only specified

topics and vetted with Tribes through a “negotiated rule-

making” process, if but only if the final regulations were

promulgated within 18 months (later expanded to 20

months) after enactment of the 1994 Amendments. See 196.

Amendments § 105, 108 Stat. 4269 (amending ISDA § 107,

codified as later further amended at 25 U.S.C. § 450k); App.

19a-20a; see also 1994 Rep. 14 (“Beyond the areas specified

...,no further delegated authority is conferred.”).

In short, after the 1988 and 1994 Amendments, it would

be difficult to find a context in which it would be less persua-

sive for the government to argue for any degree of deference

to a federal Officer’s exercise of discretion in the construc-

tion or implementation of a federal statute.

Ill. IN LIGHT OF THE ISDA’s History, ITS FUNDING PROVI-

SIONS CANNOT BE CONSTRUED TO MAKE REIMBURSE- |

MENT OF TRIBAL CONTRACT SUPPORT COSTS DEPEND ON

THE SECRETARY'S DISCRETIONARY DECISIONS CONCERN-

ING THE FUNDING OF FEDERAL ADMINISTRATIVE COSTS

It is against this background that the Secretary now re-

sists the Federal Circuit’s conclusion that he is contractually

bound to pay the contract support costs at issue in these

cases. In doing so, he seizes on the only language he can in

the ISDA: the “availability” and “reduction” clauses of 25

U.S.C. § 450j-1(b).

The Secretary’s core argument is that the ISDA allows

him to decide what amounts he needs for purposes of his

own administrative establishment, and to treat only what-

ever is left over as “availab[le]” to fund both ISDA contracts

and direct services to other Tribes. See, e.g., 03-853 Pet. 24

(funds needed for Secretary’s own functions not “meaning-

fully” available to satisfy ISDA contract obligations); id. at

26 (decision to use appropriated funds to pay for “federal

functions” rather than contract obligations did not “ ‘reduce’

funding to the Tribes” because the Secretary “never ...

treated [those funds] as available to pay for [contracted]

services ... to begin with”). This is, in effect, an argument

that the Secretary must have the discretion to make difficult

trade-offs between tribal and federal administrative costs, in

the context of overall budgetary constraints. See id. at 17

(both Secretary and Tribes must be “constrained by the ...

[Secretary’s] need to allocate funds among competing

needs”); 02-1472 Br. in Opp. 16 (“ ‘availability’ should be

read” to mean “practical availability,” “in view of competing

claims and priorities” as determined by the Secretary). Yet,

as we have described, the whole history of the ISDA demon-

strates beyond question that that is precisely the sort of de-

cision that Congress has concluded it cannot safely entrust

to the discretion of federal administrators."

A. The Governmental Nature Of ISDA Contracts

Does Not Undermine Their Enforceability

The Secretary argues in part that because ISDA con-

tracts are “governmental funding arrangements,” rather

than “procurement contracts,” they are “constrained by ...

the need to allocate funds among competing needs.” 03-853

Pet. 17. In the Secretary’s view, of course, he is the one to

determine the necessary “allocat{ion].” There is, however,

more than a little irony in the Secretary’s invocation of the

government-to-government nature of ISDA agreements as

an argument to support limiting reimbursement of tribal

administrative costs.

As the history discussed above demonstrates, in 1988

the Senate Indian Affairs Committee also stressed “the

''In Ramak Navajo School Bourd, Inc. v. Babbitt, 87 F.3d 1338,

1345-46 (1996), the D.C. Circuit considered an IHS formula for allocation

of limited funds, which reduced the amount available to Tribes that missed

an agency-imposed deadline for submitting contract requests. Rejecting

an argument based in part on the availability clause, the court held that

the Secretary had no discretion to impose the penalty formula, in light of

Congress's “irritation” with the ISDA funding agencies’ “ ‘failures to ad-

minister self-determination contracts in conformity with the law,’” and its

consequent decision to deny the agencies any discretion with respect to

ISDA contract funding. Jd. at 1345.

unique nature of self-determination contracts between the

Federal Government and Indian tribal governments.” 1988

Rep. 18. The Committee was explaining why the Secretar-

ies had erred in failing to exercise their discretion to exempt

ISDA contracts from most federal procurement rules, in-

stead replacing the “federal [Indian] service bureaucracy”

with a “federal contract monitoring bureaucracy.” Jd. at 18-

19. Congress’s response to that federal administrative fail-

ure was to amend the statute itself to make clear that ISDA

contracts are not “procurement” contracts, and that they

should not be subjected to burdensome procurement rules.

See pp. 12-13, supra. At the same time, although it consid-

ered changing the statutory term “contract” to something

such as “intergovernmental agreement,” the Committee ul-

timately retained the term “contract” because that term was

“important to convey the sense of a legally binding instru-

ment.” 1988 Rep. 19 (emphasis added). Indeed, the 1988

Amendments added important provisions designed to con-

firm and enhance not only the mandatory inclusion of CSCs

in the funding for ISDA contracts, but the enforceability of

those contracts as contracts. See pp. 15-16, supra; 25 U.S.C.

§ 450m-l(a), (d). The Secretary’s present argument for

greater flexibility to reduce his obligations under ISDA

“governmental funding arrangements” (03-853 Pet. 17), be-

cause of his own determinations about the need to maintain

his own administrative apparatus, runs completely counter

to Congress’s intentions.

B. Congress Did Not Give Federal Administrators

Discretion To Determine When Funds Are “Avail-

able” To Pay CSCs

There is no question that, in the years in question, Con-

gress did not give the Secretary enough money to pay for

everything he wanted in his own agency, while fully honor-

ing his statutory and contractual commitment to fund peti-

tioners’ CSCs. The question is who béars the burden of that

shortfall.

The Tribes argue, and the Federal Circuit held (see 03-

853 Pet. App. 16a), that the Secretary was required to fulfill

his contractual obligations first—even if doing so required

either cutting his own bureaucracy or seeking a further ap-

propriation. The Secretary argues, to the contrary, that he

was entitled to set funds aside for his “inherently federal”

functions, before deciding how much remained “available” to

pay for direct tribal services and ISDA contracts. See 03-

853 Pet. 24-25; see also 02-1472 Br. in Opp. 15-17. Yet a ma-

jor focus of Congress’s dissatisfaction with the Secretaries’

implementation of ISDA in 1988 was the Secretaries’ “di-

version of tribal contract funds to pay for costs incurred by

the Federal government.” 1988 Rep. 30. Accordingly, the

1988 Amendments required inclusion of CSCs and other in-

direct costs in determining contract funding, and specifically

directed that such funding “shall not be reduced to make

funding available for contract monitoring or administration

by the Secretary”; “shall not be reduced by the Secretary to

pay for Federal functions including, but not limited to, Fed-

eral pay costs, Federal employee retirement benefits, auto-

mated data processing, contract technical assistance or con-

tract monitoring”; and “shall not be reduced by the Secre-

tary to pay for the costs of Federal personnel displaced by a

self-determination contract.” 25 U.S.C. § 450j-1(b) (empha-

sis added).

Similarly, the House Conference Report accompanying

the Interior and IHS appropriations bill for 1995—one of the

years at issue here—directed the IHS to consult with Tribes

to “address the [federal] organizational changes needed,

such as closing and consolidating area offices and delegating

area office and headquarters functions to the field, to free up

funding for additional self-governance compacts in fiscal

year 1995 and beyond.” H.R. Conf. Rep. No. 103-740, at 51

(1994). And in 1994, when it ran out of patience with the

Secretaries and prescribed its own form of ISDA contract,

Congress included the special rule of construction requiring

that “each provision” of both the ISDA and the prescribed

contract “shall be liberally construed ... to transfer . . . fund-

ing and ... related functions, services, activities, and pro-

grams ..., including all related administrative functions,

from the Federal Government to the [tribal] Contractor.” 25

U.S.C. § 4501(c), sec. 1(a)(2) (emphasis added).

Consistently, Congress’s focus has been on transferring

administrative functions to Tribes and reducing—not pro-

tecting—federal administration. See also pp. 11-14, 17-18,

supra. The statute and its history make clear that contract

support costs are non-discretionary items, and that Con-

gress wants the Secretaries to fund tribal administration in

preference to ite own administrative operations. In that

light, it is difficult to credit the Secretary’s current argu-

ment that Congress intended the determination of what ap-

propriated funds are “availab[le]” to fund contracts under 25

U.S.C. § 450j-1(b) to begin only after the Secretary has al-

ready made whatever he considers adequate provision for

“federal functions.” See 03-853 Pet. 24.

C. In The Absence Of Specific Congressional Action,

The Risk Of A Shortfall In Overall Appropriations

Should Be Bore By The Secretaries, Not By

Tribes

In the end, the Secretary argues bluntly that the ISDA

“place[s] the risk of insufficiency [of appropriations] on peti-

tioners” and other contracting Tribes. 02-1472 Br. in Opp.

19. If that argument referred to congressional action spe-

cifically limiting appropriations for use in paying petitioners,

or in funding CSCs, it might have more foree—despite the

expressly contractual nature of the government’s obliga-

tions. But as petitioners demonstrate, the appropriations at

issue in this case were not so limited. What the Secretary

has in mind instead is the risk that his agency’s overall ap-

propriation may be insufficient, not to pay petitioner’s CSCs,

but to pay them while also paying for everything else that

the Secretary considers an equal or higher priority.

In that regard, the Secretary is correct in noting at least

the theoretical relevance of the ISDA’s provision that “the

Secretary is not required to reduce funding for programs .. .

serving a tribe to make funds available tq another tribe”

through an ISDA contract. 25 U.S.C. § 450j-1(b), But the

Secretary must bear the burden of showing—not just assert-

- 26

ing—that he has both properly invoked that provision, and

demonstrated its applicability on a given set of facts. Cf. id.

§ 450f(e)(1). The better time for the Secretary to raise the

reduction clause as an impediment to “mak[ing] funds avail-

able” to petitioners under the ISDA, in the amount other-

wise required by the Act, would have been before he had

contractually committed himself to pay the full amount, or

otherwise at a time when the Tribe could still obtain a timely

hearing, including judicial review, to explore the relevant

factual and legal issues. Cf. id. § 450f(a)(2)(D) and (b), 450m-

l(a). That was not done here. In any event, in this case the

Federal Circuit considered this question and concluded that

amounts the Secretary reserved for “inherently federal

functions,” and amounts unexpended at the end of the rele-

vant years, “clearly [did] not fall under this restriction,” and

together were “more than sufficient” to allow the Secretary

to pay petitioners’ CSCs. 03-853 Pet. App. 32a. There is no

reason for this Court to revisit that fact-bound determina-

tion.

More generally, under the Secretary’s apparent logic,

the risk of any overall shortfall in appropriations would fall

first and foremost on ISDA contracting Tribes; then, in the

Secretary's discretion, on the non-contracting Tribes bene-

fiting from program funding that the Secretary is “not re-

quired” to reduce in favor of ISDA contract funding, 25

U.S.C. § 450j-1(b); and only then on any portion of the Secre-

tary’s own administrative funding. That hypothetical result

is no less “absurd” than the one the Secretary posits if he is

required to honor his ISDA contracts under the “availabil-

ity” clause. See 03-853 Pet. 24. Indeed, preferring federal

administrative funding to tribal funding in the manner that

the Secretary advocates would plainly be /ess consistent

with the congressional intentions expressed in the text and

history of the ISDA.

Finally, placing the principal risk of appropriation short-

falls on the Secretary, rather than on ISDA-contract Tribes,

is functionally @appropriate. It is, after all, the Secretary

who ultimately requests and receives appropriations from

Congress—and who has the best access to information con-

cerning the full amount needed to fund his own necessary

administrative functions, the services he provides to Tribes

directly, and the services and administrative responsibilities

that have been transferred to contracting Tribes under the

ISDA. And putting the Secretary’s administrative budget

at some risk gives the agencies an incentive to act."

Recognizing these realities, Congress in the ISDA re-

quired the Secretaries to provide annual reports concerning

the need for funding—specifically including funding for con-

tract support costs. 25 U.S.C. § 450j-l(c). (So far as the

NCAI is aware, the Secretary has never complied with that

requirement.) The Senate Indian Affairs Committee also

repeatedly called on both Secretaries to request appropria-

tions that would fully fund their obligations under the ISDA,

and criticized them for not doing so. See, e.g., 1988 Rep. 9,

14. Congressional appropriators urged reductions in federal

adminsitrative costs, in order to free up funds to pay tribal

CSCs. See p. 24, supra. And in the end, Congress enacted

statutory provisions that clearly make the Secretaries’

ISDA obligations judicially enforceable, specifically includ-

ing through money damages or injunctions to compel pay-

ment of amounts due.’ The clear import of the ISDA’s pro-

'? Indeed, once it became clear that Tribes might in fact enforce their

ISDA rights, the agencies did go back to Congress. See, e.g., 03-853 Pet.

20-23 (discussing Section 314 of the Omnibus Consolidated and Emer-

gency Supplemental Appropriations Act, 1999, Pub. L. No. 105-277, 112

Stat. 2681-2688 (1998)). True to form, what they sought was protection for

their own operations, rather than for contracting Tribes. Nonetheless, the

agencies’ interest in, and ability to procure, congressional action amply

demonstrates the efficacy of the incentive created by the ISDA’s manda-

tory funding and enforcement provisions. It also shows the relative ad-

vantage that the agencies have in obtaining specific decisions from Con-

gress concerning how to rebalance future financial commitments, if and

when it is necessary to do so.

'’ The Secretary has argued in passing (03-853 Pet. 22 n.9; 02-1472

Br. in Opp. 25 n.9) that money damages are not available to petitioners,

because any appropriations have been exhausted and petitioners could not

be paid from the Judgment Fund, 31 U.S.C. § 1304. As the Federal Cir-

visions and history is that, as between either Secretary and Respectfully submitted,

an ISDA Tribe, in the absence of some more specific con-

gressional action, and so long as appropriations are legally

“available” to satisfy contractual commitments under the a nes atl _ "“Geeouheliaeen

ISDA, Congress placed the risk of any overall budgetary NATIONAL CONGRESS OF WILMER CUTLER . cupenen

shortfall squarely on the Secretary—not the Tribes. AMERICAN INDIANS HALE AND Dorr LLP

CONCLUSION ee Ave., N.W. see Street, N.W.

The judgment of the Tenth Circuit in No. 02-1472 should Washington, DC 20036 ane) — 20037

be reversed. The judgment of the Federal Circuit in No. 03- ;

853 should be affirmed.

JUNE 2004

cuit held, however, there was ample statutory authority for the agency to

contract to pay petitioners’ contract support costs—and Congress clearly

made any such contract enforceable against the government. See 03-853

Pet. App. 34a-35a; 25 U.S.C. § 450m-1l(a) (authorizing district courts to

award “appropriate relief including money damages”), (d) (applicability of

Contract Disputes Act); 41 U.S.C. § 612(a)-(b) (allowing for “judgments”

and “monetary awards”). There is no reason that any award resulting

from such a proceeding should not be payable in the ordinary course from

the Judgment Fund—whether or not the Secretary presently has any

resources that could lawfully be used to reimburse that Fund. The Con-

tract Disputes Act expressly contemplates that agencies may need to seek

supplemental appropriations in order to reimburse the Judgment Fund

’ after losing a case. See 41 U.S.C. § 612(c) (“Payments made pursuant to

subsections (a) and (b) shall be reimbursed to the fund provided by section

1304 of title 31, United States Code, by the agency whose appropriations

were used for the contract out of available funds or by obtaining addi-

tional appropriations for such purposes.” (emphasis added)). In any

event, in practice an agency “need not disrupt ongoing programs or activi-

ties in order to find the money |to reimburse the Judgment Fund]. If this

were not the case Congress could have just as easily directed the agencies

to pay the judgments and awards directly.” General Accounting Office, 3

Principles of Federal Appropriations Law, ch. 12, at 78 (2d ed. 1994).

Perhaps for that reason, most contract damages paid out of the Judgment

Fund are never actually reimbursed. See id. ch. 13, at 20.

APPENDIX

TABLE OF CONTENTS

Indian Self-Determination and Education Assis-

tance Act of 1975, Pub. L. No. 93-638, 88 Stat.

2203 (codified as amended at 25 U.S.C. §§ 450 et

BBG). ) cscacssresessssesseremeenensessescesrsuinmasisemmnanamnenneenmnemaneneenstants la

The ISDA as amended by the Indian Self-

Determination and Education Assistance Act

Amendments of 1988, Pub. L. No. 100-472, 102

The ISDA as amended by The Indian Self-

Determination Contract Reform Act of 1994,

Pub. L. No. 103-413, tit. 1, 108 Stat. 4250..................... 12a

APPENDIX

STATUTORY PROVISIONS

Indian Self-Determination and Education Assistance Act

of 1975, Pub. L. No. 93-638, 88 Stat. 2203.

(Codified as amended at 25 U.S.C. §§ 450 et seq.)

* * * *

DECLARATION OF POLICY

SEC. 3. (a) The Congress hereby recognizes the obliga-

tion of the United States to respond to the strong expression

of the Indian people for self-determination by assuring

maximum Indian participation in the direction of educational

as well as other Federal services to Indian communities so

as to render such services more responsive to the needs and

desires of those communities.

(b) The Congress declares its commitment to the main-

tenance of the Federal Government’s unique and continuing

relationship with and responsibility to the Indian people

through the establishment of a meaningful Indian self-

determination policy which will permit an orderly transition

from Federal domination of programs for and services to In-

dians to effective and meaningful participation by the Indian

people in the planning, conduct, and administration of those

programs and services.

* * * *

CONTRACTS BY THE SECRETARY OF HEALTH, EDUCATION,

AND WELFARE

SEC. 103. (a) The Secretary of Health, Education, and

Welfare is directed, upon the request of any Indian tribe, to

enter into a contract or contracts with any tribal organiza-

tion of any such Indian tribe to carry out any or all of his

functions, authorities, and responsibilities under the Act of

August 5, 1954 (68 Stat. 674), as amended: Provided, how-

ever, That the Secretary may initially decline to enter into

any contract requested by an Indian tribe if he finds that: (1)

the service to be rendered to the Indian beneficiaries of the

particular program or function to be contracted for will not

be satisfactory; (2) adequate protection of trust resources is

not assured; or (3) the proposed project or function to be

contracted for cannot be properly completed or maintained

by the proposed contract: Provided further, That the Secre-

tary of Health, Education, and Welfare, in arriving at his

finding, shall consider whether the tribe or tribal organiza-

tion would be deficient in performance under the contract

with respect to (A) equipment, (B) bookkeeping and account-

ing procedures, (C) substantive knowledge of the program to

be contracted for, (D) community support for the contract,

(E) adequately trained personnel, or (F) other necessary

components of contract performance.

(b) Whenever the Secretary of Health, Education, and

Welfare declines to enter into a contract or contracts pursu-

ant to subsection (a) of this section, he shall (1) state his ob-

jections in writing to the tribe within sixty days; (2) provide,

to the extent practicable, assistance to the tribe or tribal or-

ganization to overcome his stated objections; and (3) provide

the tribe with a hearing, under such rules and regulations as

he shall promulgate, and the opportunity for appeal on the

objections raised.

* * * *

ADMINISTRATIVE PROVISIONS

SEC. 106. (a) Contracts with tribal organizations pursu-

ant to sections 102-and 103 of this Act shall be in accordance

with all Federal contracting laws and regulations except

that, in the discretion of the appropriate Secretary, such

contracts may be negotiated without advertising and need

not conform with the provisions of the Act of August 24,

1935 (49 Stat. 793), as amended: Provided, That the appro-

priate Secretary may waive any provisions of such contract-

ing laws or regulations which he determines are not appro-

priate for the purposes of the contract involved or inconsis-

tent with the provisions of this Act.

* * * *

(h) The amount of funds provided under the terms of

contracts entered into pursuant to sections 102 and 103 shall

not be less than the appropriate Secretary would have oth-

erwise provided for his direct operation of the programs or

portions thereof for the period covered by the contract: Pro-

vided, That any savings in operation under such contracts

shall be utilized to provide additional services or benefits

under the contract.

‘

PROMULGATION OF RULES AND REGULATIONS

SEC. 107. (a) The Secretaries of the Interior and of

Health, Education, and Welfare are each authorized to per-

form any and all acts and to make such rules and regulations

as may be necessary and proper for the purposes of carryin

out the provisions of this title. =

* * * *

REPORTS

. SEC. 108. For each fiscal year during which an Indian

tribal organization receives or expends funds pursuant to a

contract or grant under this title, the Indian tribe which re-

quested such contract or grant shall submit to the appropri-

ate Secretary a report including, but not limited to, an ac-

counting of the amounts and purposes for which Federal

funds were expended, information on the conduct of the pro-

gram or service involved, and such other information as the

appropriate Secretary may request.

* * * *

The ISDA as amended by the Indian Self-Determination

and Education Assistance Act Amendments of 1988,

Pub. L. No. 100-472, 102 Stat. 2285.

DECLARATION OF POLICY

[Section 102 of the 1988 Amendments, 102 Stat. 2285,

amended ISDA Section 3(b). 25 U.S.C. § 450a (1988). The

new language is shown in italics. ]

SEC. 3 (b) The Congress declares its commitment to the

maintenance of the Federal Government’s unique and con-

tinuing relationship with, and responsibility to, individual

Indian tribes and to the Indian people as a whole through

the establishment of a meaningful Indian self-determination

policy which will permit an orderly transition from the Fed-

eral domination of programs for, and services to, Indians to

effective and meaningful participation by the Indian people

in the planning, conduct, and administration of those pro-

grams and services. Jn accordance with this policy, the

United States is committed to supporting and assisting In-

dian tribes in the development of strong and stable tribal

governments, capable of administering quality programs

and developing the economies of their respective commun-

ities.

REPORTING AND AUDIT REQUIREMENTS

[Section 208 of the 1988 Amendments, 102 Stat. 2296

amended ISDA Section 108 and redesignated it as section

5(f). 25 U.S.C.

§ 450c(f) (1988). New language is shown

SEC. 5. (f) For each fiscal year during which an Indian

tribal organization receives or expends funds pursuant to a

contract or grant under this title, the Indian tribe which re-

quested such contract or grant shall submit to the appropri-

ate Secretary a report including, but not limited to, an ac-

counting of the amounts and purposes for which Federal

funds were expended, information on the conduct of the pro-

gram or service involved, and such other information as the

appropriate Secretary may request through regulations

a under sections 552 and 553 of title 5, United

SE LF-DETERMINATION CONTRACTS

[Section 201 of The 1988 Amendments, 102 Stat. 2288,

combined ISDA Sections 102 and 103 into a new Section

102, with substantial revisions. 25 U.S.C. § 450f (1988).

Italics are used to emphasize particular new material. }

SEc. 102. (a)(1) The Secretary is directed, upon the re-

quest of any Indian tribe by tribal resolution, to enter into a

self-determination contract or contracts with a tribal organi-

zation to plan, conduct, and administer programs or portions

thereof, including construction programs—

(A) provided for in the Act of April 16, 1934 (48 Stat.

596), as amended;

(B) which the.Secretary is authorized to administer

for the benefit of Indians under the Act of November 2, 1921

(42 Stat. 208), and any Act subsequent thereto;

Services under the Act of August 5, 1954 (68 Stat. 674), as

amended;

(D) administered by the Secretary for the benefit of

Indians for which appropriations are made to agencies other

than the Department of Health and Human Services or the

Department of the Interior; and

(E) for the benefit of Indians because of their status

as Indians without regard to the agency or office of the De-

partment of Health and Human Services or the Department

of the Interior within which it is performed.

(2) If so authorized by an Indian tribe under paragraph

(1) of this subsection, a tribal organization may submit a

proposal for a self-determination contract to the Secretary

for review. The Secretary shall, within ninety days after re-

ceipt of the proposal, approve the proposal unless, within

sixty days of receipt of the proposal, a specific finding is

made that—

(A) the service to be rendered to the Indian bene-

. . *

ficiaries of the particular program or function to be con-

tracted will not be satisfactory;

(B) adequate ,

ae. protection of trust resources is not as-

tracted

for cannot be properly com or maintai

ce pleted maintained by the pro-

(3) Upon the request of a tribal organization that

ates two or more mature self-determination contracts, + a |

contracts may be consolidated into one single contract.

(b) Whenever the Secretary declines to enter i

whe into -

determination contract or contracts pursuant to ioe

(a) of this section, the Secretary shall—

(3) ctate enw festions! a , ,

on tate any objections in writing to the tribal organiza-

(2) provide assistance to the tri organization

come the stated objections, and _ sess

(3) provide the tribal organization with a heari

on the

Se ee ter appeal en the ebdections

raised, r such rules and latio Secretary

may promulgate. leak at:

CONTRACT FUNDING AND INDIRECT COSTS

[Section 205 of the 1988 Amendments, 102 Stat. 2292,

added a new ISDA Section 106. 25 U.S.C. § 450j-1

(1988).]

SEc. 106. (a)(1) The amount of funds provided under the

terms of self-determination contracts entered into pursuant

to this Act hall not be less than the appropriate Secretary

would have otherwise provided for the operation of the pro-

grams or portions thereof for the period covered by the con-

tract.

(2) There shall be added to the amount required by

paragraph (1) contract support costs which shall consist of

‘the reasonable costs for activities which must be carried on

by a tribal organization as a contractor to ensure compliance

with the terms of the contract and prudent management, but

which -

(A) normally are not carried on by the respective

Secretary in his direct operation of the program; or

(B) are provided by the Secretary in support of the

contracted program from resources other than those under

contract.

(3) Any savings in operation under a self-determination

contract shall be utilized to provide additional services or

benefits under the contract or be expended in the succeeding

fiscal year as provided in section 8 of this Act.

(b) The amount of funds required by subsection (a) —

(1) shall not be reduced to make funding available for

contract monitoring or administration by the Secretary;

(2) shall not be reduced by the Secretary in subse-

quent years except pursuant to —

(A) a reduction in appropriations from the previ-

ous fiscal year for the program or function to be contracted;

(B) a directive in the statement of the managers

accompanying a conference report on an appropriation bill or

continuing resolution;

(D) a change in the amount of pass-through funds

needed under a contract; or

(E) completion of a contracted project, activity,

or program;

(3) shall not be reduced by the Secretary to pay for

Federal functions, including, but not limited to, Federal pay

costs, Federal employee retirement benefits, automated

data processing, contract technical assistance or contract

monitoring;

(4) shall not be reduced by the Secretary to pay for

the costs of Federal personnel displaced by a self-deter-

mination contract; and

(5) may, at the request of the tribal organization, be

increased by the Secretary if necessary to carry out this Act

or as provided in section 105(c).

Notwithstanding any other provision in this Act, the pro-

vision of funds under this Act is subject to the availability of

appropriations and the Secretary is not required to reduce

funding for programs, projects, or activities serving a tribe

to make funds available to another tribe or tribal organi-

zation under this Act.

* * * *

10a

PROMULGATION OF RULES AND REGULATIONS

[Section 207 of the 1988 Amendments, 102 Stat. 2295,

amended ISDA Sections 107(a) and (b). 25 U.S.C. § 450k

(1988). The new language is shown in italics. }

SEc. 107. (a) The Secretaries of the Interior and of

Health and Human Services are each authorized to perform

any and all acts and to make such rules and regulations as

may be necessary and proper for the purposes of carrying

out the provisions of this title: Provided, however, That all

Federal requirements for self-determination contracts and

grants under this Act shall be promulgated as regulations

in conformity with sections 552 and 552 of title 5, United

States Code.

* * * *

(b\3) Within seven months from the date of enact-

ment of the Indian Self-Determination and Education As-

sistance Act Amendments of 1988, the Secretary shall pub-

lish proposed regulations in the Federal Register for the

purpose of receiving comments from tribes and other inter-

ested parties.

(4). Within ten months from the date of enactment of

the Indian Self-Determination and Education Assistance

Act Amendments of 1988, the Secretary shall promulgate

regulations to implement the provisions of such Act.

lla

CONTRACT APPEALS

[Section 206 of the 1988 Amendments, 102

Stat.

fy new ISDA Section 110. 25 U.S.C. § we

SEc. 110 (a) The United States district courts shall have

original Jurisdiction over any civil action or claim against the

appropriate Secretary arising under this Act and subject to

the provisions of subsection (d) of this section and concur-

rent with the United States Court of Claims, over any civil

action or claim against the Secretary for money damages

arising under contracts authorized by this Act. In an action

brought under this paragraph, the district courts may order

appropriate relief including money damages, injunctive re-

lief against any action by an officer of the United States or

any agency thereof contrary to this Act or regulations

promulgated thereunder, or mandamus to compel an officer

nd oe age the United States, or any agency thereof, to

orm a du rovi i ic

seen dhl ol — under this Act or regulations

(b) Unless otherwise agreed to b i

y the resolution of

Indian tribe, the Secretary shall not revise or amend con

determination contract with such tribe.

w 96-48

~ hed peers 1, 1980; 94 Stat. 2325, as amended), shall -

ply ministrative appeals by tribal organizati regard

ing self-determination cont 4 ; wie

(d) The Contract Disputes Act (Public Law 95-563, Act

of November 1, 1978; 92 Stat. 2383

to self-determination contracts. aaa ts

12a

The ISDA as amended by The Indian Self-Determination

Contract Reform Act of 1994, Pub. L. No. 103-413, Tit. I,

108 Stat. 4250.

REPORTING AND AUDIT REQUIREMENTS

[Section 102(2) of the 1994 Amendments, 108 Stat. 4250,

amended ISDA Section 5(f) to read as follows. 25 U.S.C.

§ 450c (1994).]

SEC. 5. (f)(1) For each fiscal year during which an Indian

tribal organization receives or expends funds pursuant toa

contract entered into, or grant made, under this Act, the

tribal organization that requested such contract or grant

shall submit to the appropriate Secretary a single-agency

audit report required by chapter 75 of title 31, United States

Code. |

(2) In addition to submitting a single-agency audit re-

port pursuant to paragraph (1), a tribal organization re-

ferred to in such paragraph shall submit such additional in-

formation concerning the conduct of the program, function,

service, or activity carried out pursuant to the contract or

grant that is the subject of the report as the tribal organiza-

tion may negotiate with the Secretary.

(3) Any disagreement over reporting requirements shall

be subject to the declination criteria and procedures set

forth in section 102.

* + * *

l3a

SELF-DETERMINATION CONTRACTS

[Sections 102(5), (6), (7) and (9) of the 1994 Amendments,

108 Stat. 4252, amended ISDA Section 102 subsections

(a), (b), and (e). 25 U.S.C. § 450f (1994). The new lan-

guage is shown in italics.]

SEC. 102. (a)(1) The Secretary is directed, upon the re-

quest of any Indian tribe by tribal resolution, to enter into a

self-determination contract or contracts with a tribal organi-

zation to plan, conduct, and administer programs or portions

thereof, including construction programs—

* * * *

The programs, functions, services, or activities that are con-

tracted under this paragraph shall include administrative

functions of the Department of the Interior and the Depart-

ment of Health and Human Services (whichever is applica-

ble) that support the delivery of services to Indians, includ-

ing those administrative activities supportive of, but not in-

cluded as part of, the service delivery programs described in

this paragraph that are otherwise contractable. The admin-

istrative functions referred to in the preceding sentence shall

be contractable without regard to the organizational level

within the Department that carries out such functions.

(2) If so authorized by an Indian tribe under paragraph

(1) of this subsection, a tribal organization may submit a

proposal for a self-determination contract, or a proposal to

amend or renew a self-determination contract, to the Secre-

tary for review. Subject to the provisions of paragraph (4),

the Secretary shall, within ninety days after receipt of the

proposal, approve the proposal and award the contract

unless, the Secretary provides written notification to the ap-

plicant that contains a specific finding that clearly demon-

strates that, or that is supported by a controlling legal au-

thority that —

l4a

(A) the service to be rendered to the Indian benefici-

aries of the particular program or function to be contracted

will not be satisfactory;

(B) adequate protection of trust resources is not as-

sured;

for cannot be properly completed or maintained by the pro-

posed contract;

(D) the amount of funds proposed under the contract

is in excess of the applicable funding level for the contract,

_as determined under section 106(a); or

(E) the program function, service, or activity (or por-

tion thereof) that is the subject of the proposal is beyond thz

scope of programs, functions, services, or activities covered

under paragraph (1) because the proposal includes activities

that cannot lawfully be carried out by the contractor.

* * * *

(4) The Secretary shall approve any severable portion of

a contract proposal that does not support a declination find-

ing described in paragraph (2). If the Secretary determines

under such paragraph that a contract proposal—

(A) proposes in part to plan, conduct or administer

a program, function, service, or activity that is beyond the

scope of programs covered under paragraph (1), or

(B) nroposes a level of funding that is in excess of

the applicable level under section 106(a),

subject to any alteration in the scope of the proposal that the

Secretary and the tribal organization agree to, the Secretary

shall, as appropriate, approve such portion of the program,

function, service, or activity as is authorized under para-

graph (1) or approve a level of funding authorized under

section 106(a). If a tribal organization elects to carry out a

severable portion of a contract proposal pursuant to this

paragraph, subsection (b) shall only apply to the portion of

15a

the contract that is declined by the Secretary pursuant to

this subsection.

* * * *

(b) Whenever the Secretary declines to enter into a self-

determination contract or contracts pursuant to subsection

(a) of this section, the Secretary shall—

* * * *

(3) provide the tribal organization with a hearing on the

record with the right to engage in full discovery relevant to

any issue raised in the matter and the opportunity for ap-

peal on the objections raised, under such rules and regu-

lations as the Secretary may promulgate, except that the

tribe or tribal organization may, in lieu of filing such ap-

peal, exercise the option to initiate an action in a Federal

district court and proceed directly to such court pursuant to

section 110(a).

* * * *

(e)(1) With respect to any hearing or appeal conducted

pursuant to subsection (b)(3), the Secretary shall have the

burden of proof to establish by clearly demonstrating the

validity of the grounds for declining the contract proposal

(or portion thereof).

l6a

CONTRACT FUNDING AND INDIRECT COSTS

[Section 102(14) of the 1994 Amendments, 108 Stat. 4257,

amended ISDA Section 106(a) to read in part as follows.

25 U.S.C. § 450j-1 (1994). The new language is shown in

italics. ]}

SEC. 106. (a)(1) The amount of funds provided under the

terms of self-determination contracts entered into pursuant

to this Act shall not be less than the appropriate Secretary

would have otherwise provided for the operation of the pro-

grams or portions thereof for the period covered by the con-

tract, without regard to any organizational level within the

Department of the Interior or the Department of Health and

Human Services, as appropriate, at which the program,

function, service, or activity or portion thereof, including

supportive administrative functions that are otherwise con-

tractable, is operated.

(2) There shall be added to the amount required by

paragraph (1) contract support costs which shall consist of

an amount for the reasonable costs for activities which must

be carried on by a tribal organization as a contractor to en-

sure compliance with the terms of the contract and prudent

management, but which -

(A) normally are not carried on by the respective Secre-

tary in his direct operation of the program; or

(B) are provided by the Secretary in support of the con-

tracted program from resources other than those under con-

tract.

(3)(A) The contract support costs that are eligible costs

for the purposes of receiving funding under this Act shall

include the costs of reimbursing each tribal contractor for

reasonable and allowable costs of —

(i) direct program expenses for the operation of the Fed-

eral program that is the subject of the contract, and

(ii) any additional administrative or other expense re-

lated to the overhead incurred by the tribal contractor in

17a

connection with the operation of the Federal progra

. . . . me, ss

tion, service, or activity pursuant to the contract, aire

except that such funding shall not dupli

provided under section 106(a). —e

* * * *

18a

CONTRACT APPEALS

{Section 104(2) of the 1994 Amendments, 108 Stat. 4268,

amended ISDA Section 110(a) to read as follows. 25

U.S.C. § 450m-1 (1994). The new language is shown in

italics. ]

SEc. 110. (a) The United States district courts shall

have original jurisdiction over any civil action or claim

against the appropriate Secretary arising under this Act

and, subject to the provisions of subsection (d) of this section

and concurrent with the United States Court of Claims, over

any civil action or claim against the Secretary for money

damages arising under contracts authorized by this Act. In

an action brought under this paragraph, the district courts

may order appropriate relief including money damages, in-

junctive relief against any action by an officer of the United

States or any agency thereof contrary to this Act or regula-

tions promulgated thereunder, or mandamus to compel an

officer or employee of the United States, or any agency

thereof, to perform a duty provided under this Act or regu-

lations promulgated hereunder (including immediate in-

junctive relief to reverse a declination finding under section

102(a)(2) or to compel the Secretary to award and fund an

approved self-determination contract).

* * * *

19a

PROMULGATION OF RULES AND REGULATIONS

[Section 105 of the 1994 Amendments, 108 Stat. 4269,

amended ISDA Section 107 to read in part as follows. 25

U.S.C. § 450k (1994).]

SEC. 107. (a)(1) Except as may be specifically authorized

in this subsection, or in any other provision of this Act, the

Secretary of the Interior and the Secretary of Health and

Human Services may not promulgate any regulation, nor

impose any nonregulatory requirement, relating to self-

determination contracts or the approval, award, or declina-

tion of such contracts, except that the Secretary of the Inte-

rior and the Secretary of Health and Human Services may

promulgate regulations under this Act relating to chapter

171 of title 28, United States Code, commonly known as the

‘Federal Tort Claims Act’, the Contract Disputes Act of 1978

(41 U.S.C. 601 et seq.), declination and waiver procedures,

appeal procedures, reassumption procedures, discretionary

grant procedures for grants awarded under section 103,

property donation procedures arising under section 105(f),

internal agency procedures relating to the implementation of

this Act, retrocession and tribal organization relinquishment

procedures, contract proposal contents, conflicts of interest,

construction, programmatic reports and data requirements,

procurement standards, property management standards,

and financial management standards.

(2A) The regulations promulgated under this Act, in-

cluding the regulations referred to in this subsection, shall

be promulgated—

(i) in conformance with sections 552 and 553 of ti-

tle 5, United States Code an.’ subsections (c), (d), and (e) of

this section; and

(ii) as a single set of regulations in title 25 of the

Code of Federal Regulations.

(B) The authority to promulgate regulations set forth in

this Act shall expire if final regulations are not promulgated

20a

within 18 months after the date of enactment of the Indian

Self-Determination Contract Reform Act of 1994.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.