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Judge's decision allows HUD to lift funding freeze

National tribal housing leaders are hoping a federal judge's decision will force the Bush administration to release $300 million in federal funds.

In early June, the Department of Housing and Urban Development informed tribes they would be denied money for the remainder of the year. Officials cited a court decision that invalidated the way funds are distributed under the Native American Housing and Self-Determination Act (NAHASDA).

Although the case involved only one tribal housing authority, HUD said there was no way to proceed without holding back money for every single federally recognized tribe. "The impact is that there currently are no awards, no money going to any of the tribes," Orlando Cabrera, the assistant secretary in charge of public and Indian housing, said at a Senate hearing on June 28.

Two days later, however, U.S. District Judge Richard Matsch ordered HUD to limit the ruling to the Fort Peck Housing Authority, the plaintiff in the case. He also denied the government's motion to stay the case pending an appeal.

"It being the view of this court that because this action was not certified as a class action and because other Indian tribes are not parties in this case and have had no opportunity to take a position with respect to the validity of the rule as it affects them, the court's order does not extend beyond Fort Peck Housing Authority," Matsch wrote on June 30.

Tribal housing leaders are calling the development a "victory" for Indian Country. "This effectively compels HUD to resume FY06 NAHASDA distributions to all remaining [Indian housing authorities]," the National American Indian Housing Council said yesterday.

Government attorneys had asked Matsch to clarify the May 25 decision that led to the funding freeze. Although a request for comment from HUD's public affairs office is still pending, a motion filed in court indicated that the administration will in fact resume all NAHASDA funding.

"If this judgment applies to all Indian tribes, HUD submits that it is in error and should be amended," the June 9 motion stated. "Applying the court's relief to Plaintiff alone (which HUD can do) will provide it full relief," it continued.

The motion appears to contradict Cabrera's testimony that HUD wasn't able to restrict the decision to the Fort Peck Housing Authority. "By virtue of undertaking the lawsuit and obtaining this particular order," he said, "that is the regrettable precise effect."

Cabrera told the committee that government attorneys had asked the judge to stay the case pending an appeal. That motion was filed June 7.

He also mentioned that government attorneys asked Matsch to clarify his ruling. But he did not specifically say that HUD, in the words of the June 9 motion, "can do" what the judge has now ordered -- to limit the decision only to the Fort Peck Tribes of Montana.

"Did you think the judge would have anticipated holding up all of the funding?" asked Sen. Byron Dorgan (D-North Dakota), the vice chairman of the committee.

"That's why we're seeking the stay," Cabrera responded, citing "significant" effects in Indian Country, most notably to the Navajo Nation and the Cherokee Nation, the two largest tribes in the U.S.

The funding at issue comes in the form of NAHASDA block grants. Tribes are required to submit housing plans prior to receiving their share of funds.

But in the wake of the decision, HUD said it would not approve any more housing plans for the remainder of the year. Tribes that hadn't submitted their plans would essentially lose out until the court case was resolved.

According to HUD officials, $300 million out of the $600 million-plus NAHASDA program had yet to be approved.

Latest Court Documents:
Order Clarifying Judgement | Order Denying Stay | HUD 'Can Do' Motion

Senate Indian Affairs Committee Letter:
HUD Indian Housing Freeze (June 28, 2006)

Relevant Documents:
Cabrera Letter Suspending Funds | Court Decision in Ft. Peck Case

Hearing Info:
OVERSIGHT HEARING on Native American Housing Programs (Wednesday, June 28, 2006)

Relevant Links:
Fort Peck Tribes -
Office of Public and Indian Housing, HUD -
National American Indian Housing Council -
Senate Indian Affairs Committee -