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10th Circuit sides with tribes on self-determination contracts

The 10th Circuit Court of Appeals today sided with tribes in an important self-determination case.

The Indian Self-Determination and Education Assistance Act authorizes tribes to enter into contacts to manage federal programs. The law requires the government to pay for the cost of the program plus associated "contract support costs."

Congress, however, has failed to provide enough appropriations to cover the contract support costs. As a result, agencies like the Bureau of Indian Affairs have refused to fully fund all of the contracts.

In a 2-1 decision, the 10th Circuit said the practice was unlawful. Each contract must be considered on an individual basis despite Congressional shortfalls, the court concluded.

"As the [Supreme] Court made clear, 'if the amount of an unrestricted appropriation is sufficient to fund the contract, the contractor is entitled to payment even if the agency has allocated the funds to another purpose or assumes other obligations that exhaust the funds,'" Judge Carlos F. Lucero wrote, quoting the U.S. Supreme Court decision in Cherokee Nation v. Leavitt, another contract support cost case.

In the Cherokee case, the government argued that tribes assume a "risk" by entering into self-determination contracts without knowing whether they will receive contract support costs. The 10th Circuit noted that the Supreme Court rejected this line of thinking.

"It appears the government is relying on the fact that the appropriations were insufficient to pay all contractors, but as Cherokee held, there is no merit to the 'claim that, because of mutual self-awareness among tribal contractors, tribes, not the Government, should bear the risk that an unrestricted lump-sum appropriation would prove insufficient to pay all contractors,'" the 10th Circuit wrote.

The judges recognized that some tribes might be shortchanged during a particular funding cycle. But they said that doesn't leave the government off the hook for finding the money.

Judge Harris L. Hartz dissented. He said tribes know that Congress has placed a "spending cap" on self-determination contracts.

Turtle Talk has posted documents from the case, Ramah Navajo Chapter v. Salazar.

10th Circuit Opinion:
Ramah Navajo Chapter v. Salazar (May 9, 2011)

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