[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4151 Introduced in House (IH)]







104th CONGRESS
  2d Session
                                H. R. 4151

   To establish a National Indian Bonding Authority Pilot Project to 
 oversee the issuance of bonds to provide funding for the construction 
  of schools of the Bureau of Indian Affairs of the Department of the 
                   Interior, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 24, 1996

Mr. Johnson of South Dakota (for himself, Mr. Faleomavaega, Mr. Kildee, 
Mr. Miller of California, and Mr. Richardson) introduced the following 
 bill; which was referred to the Committee on Economic and Educational 
                             Opportunities

_______________________________________________________________________

                                 A BILL


 
   To establish a National Indian Bonding Authority Pilot Project to 
 oversee the issuance of bonds to provide funding for the construction 
  of schools of the Bureau of Indian Affairs of the Department of the 
                   Interior, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Indian Bonding Authority 
Pilot Project Act of 1996''.

SEC. 2. FINDINGS.

    The Congress finds that:
            (1) There exists a unique political and legal relationship 
        between the Government of the United States and governments of 
        Indian tribes. Indian tribes have a legal relationship with the 
        United States Government which is set forth in the Constitution 
        of the United States, treaties, Federal statutes, and judicial 
        decisions.
            (2) The Constitution of the United States gives the 
        Congress plenary power over Indian affairs; and through 
        treaties, statutes, executive orders, course of dealing, and 
        custom, the United States has undertaken a trust obligation to 
        protect Indian tribes and tribal resources.
            (3) The trust responsibility includes the duty to protect, 
        preserve, and enhance tribal assets and resources, and to 
        assist Indian tribes in improving the socioeconomic status of 
        tribes and their members in an effort to encourage economic 
        development and strengthen powers of self-government.
            (4) By fostering the development of accommodative financial 
        markets and tribal access to capital, the Federal Government 
        can assist in providing fundamental tools to greater economic 
        development and powers of self government.
            (5) The need for financial capital by Indian tribal 
        governments is acute, and the Federal Government should work to 
        facilitate capital creation and those mechanisms that will 
        permit the Federal Government to issue debt instruments as a 
        means of financing tribal government needs.
            (6) For the benefit of Indian people across the United 
        States, to increase their commerce welfare and prosperity, and 
        the improvement of their health and living conditions, it is 
        essential that this and future generations of youth be given 
        the fullest opportunity to learn and to develop their 
        intellectual and mental capacities.
            (7) It is essential that institutions of education be 
        provided with appropriate additional means to assist such youth 
        in achieving the required levels of learning and development of 
        their intellectual and mental capacities.
            (8) Institutions should be enabled to refinance outstanding 
        indebtedness incurred to provide existing facilities and to 
        preserve and enhance the facilities for the purposes of 
        education.
            (9) There are approximately 16,600,000 square feet of space 
        in Indian schools nationwide.
            (10) There exists a backlog in Grant School and Bureau 
        School facility improvement, repair, and new construction needs 
        of $850,000,000. Assuming a 3 percent inflation rate, the cost 
        of the $850,000,000 in deferred maintenance grows by 
        $25,500,000 per year due to inflation, and approximately 
        $55,000,000 per year due to natural aging and deterioration for 
        a total of $80,000,000 per year.
            (11) The replacement value of these facilities is 
        $1,830,000,000.
            (12) The magnitude of the dollars and number of projects 
        has risen to a level where these projects cannot be funded by 
        current facility improvement and repair and new construction 
        program funds.
            (13) With the physical condition of grant and bureau 
        schools deteriorating, and with the population within these 
        schools increasing, there is an immediate need for funding of 
        these projects.
            (14) The schools propose, through actions taken by 
        Congress, to be allowed to bond for project need using existing 
        education program money sources and reserve funds as the 
        repayment source and security for the bonds.
            (15) The program would establish a national pilot project 
        with the power to issue bonds, utilizing the municipal finance 
        market established to serve school districts and local 
        governments.
            (16) Instead of funding the project directly, a portion of 
        Tribal Education Construction funds currently appropriated for 
        these types of projects would be leveraged through the bonds to 
        fund substantially more projects.
            (17) The use of funds in this manner will allow the 
        appropriations to go much further to alleviate the construction 
        problems facing the schools and will reduce the deficit by 
        building the schools faster and decreasing the inflation 
        buildup currently estimated at $80,000,000 per year.
            (18) It is the purpose of this Act to provide a measure of 
        assistance and an alternative method of financing to enable 
        tribal institutions of education to provide the facilities and 
        structure which are sorely needed to accomplish the purposes of 
        this Act.
            (19) True self-determination in any society of people is 
        dependent upon an educational process which will ensure the 
        development of qualified people to fulfill meaningful 
        leadership roles. This Act will incorporate the commitment and 
        support of tribal self-determination by utilizing section 102 
        of Public Law 93-638 and Public Law 100-297 to allow tribes to 
        manage their own construction projects.

SEC. 3. DEFINITIONS.

    As used in this Act:
            (1) Authority.--The term ``Authority'' means the National 
        Indian Bonding Pilot Project Authority established by section 
        101 of this Act.
            (2) Certificates of participation.--The term ``certificates 
        of participation'' means revenue bonds of the Authority issued 
        under title II of this Act.
            (3) Cost.--The term ``cost'' as applied to a project or any 
        portion thereof financed under the provisions of the Act means 
        all or any part of the cost of construction, acquisition, 
        alteration, enlargement, reconstruction, and remodeling of a 
        project including all lands, structures, real or personal 
        property, rights, rights-of-way, franchises, easements, and 
        interests acquired or used for or in connection with a project, 
        the cost of demolishing or removing any buildings or structures 
        on land so acquired; the cost of all machinery and equipment, 
        financing charges, interest prior to, during, and for a period 
        after completion of such construction and acquisition, 
        provisions for reserves for principal and interest, and for 
        extensions, enlargements, additions, and improvements, the cost 
        of architectural, engineering, financial, and legal services, 
        plans, specifications, studies, surveys, estimates of cost and 
        of revenues, administrative expenses, necessary or incident to 
        determining the feasibility or practicability of constructing 
        the project and such other expenses as may be necessary or 
        incident to the construction and acquisition of the project.
            (4) Project.--The term ``project'' means a structure or 
        structures available for use as an administration building, 
        academic building, library, classroom, athletic facility, 
        dormitory, or other student housing facility, maintenance, 
        storage, employee housing, or utility facility, and other 
        structures or facilities related thereto or required or useful 
        for the instruction of students whether proposed, under 
        construction, or completed. Parking and other facilities or 
        structures essential or convenient for the orderly conduct of 
        such institution, including landscaping and site preparation, 
        shall also be included.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.
            (6) Tribal school.--The term ``tribal school'' means a 
        school that is operated by a tribal organization for the 
        education of Indian children with financial assistance under a 
        Public Law 100-297 grant or Public Law 93-638 contract with the 
        Bureau of Indian Affairs.

    TITLE I--ESTABLISHMENT OF NATIONAL INDIAN BONDING PILOT PROJECT 
                               AUTHORITY

SEC. 101. ESTABLISHMENT.

    (a) In General.--There is established a commission to be known as 
the National Indian Bonding Pilot Project Authority.
    (b) Membership.--
            (1) Composition.--The Authority shall be composed of 7 
        members appointed by the Secretary of the Interior as follows:
                    (A) One member shall be designated by the Authority 
                as chairperson of the Authority.
                    (B) One member shall be designated by the Authority 
                as the vice chairperson of the Authority.
                    (C) At least 1 member shall be a person having a 
                favorable reputation for skill, knowledge, and 
                experience in the field of public finance.
                    (D) At least 1 member shall be a person having a 
                favorable reputation for skill, knowledge, and 
                experience in the building construction field.
                    (E) At least 2 of the members shall be a trustee, 
                director, officer, or employee of a tribal school.
        The members may be from the public or private sector, and may 
        include Federal or tribal officers or employees, members of 
        academia, nonprofit organizations, or other interested 
        individuals.
            (2) Date.--The appointments of the members of the Authority 
        shall be made no later than 3 months after the date of 
        enactment of this Act.
    (c) Period of Appointment; Vacancies.--Two of the initial members 
shall be appointed for a 2-year term, 3 of the initial members shall be 
appointed for a 4-year term, and 2 of the initial members shall be 
appointed for a 6-year term. Thereafter, all members shall be appointed 
for a 6-year term. Any vacancy in the Authority shall not affect its 
powers, but shall be filled in the same manner as the original 
appointment.
    (d) Initial Meeting.--No later than 30 days after the date on which 
all members of the Authority have been appointed, the Authority shall 
hold its first meeting.
    (e) Meetings.--The Authority shall meet at the call of the 
Chairperson.
    (f) Quorum.--A majority of the members of the Authority shall 
constitute a quorum, but a lesser number of members may hold hearings. 
Each member of the Authority shall have 1 vote, and the vote of each 
member shall be accorded the same weight.

SEC. 102. DUTIES OF THE AUTHORITY.

    The Authority shall--
            (1) enter into an agreement with a private underwriter to 
        provide for the issuance of certificates of participation in 
        accordance with title II; and
            (2) promulgate regulations to carry out paragraph (1).

SEC. 103. POWERS OF THE AUTHORITY.

    (a) Purpose.--The purpose of the Authority shall be to assist 
institutions in the construction, financing, and refinancing of 
projects.
    (b) Rules.--The Authority is authorized and empowered to adopt 
rules for the conduct of its business.
    (c) Location and Choice of Projects.--The Authority is authorized 
and empowered to determine the location and character of any project to 
be financed under the provisions of this Act. The Authority shall work 
with the Department of the Interior to determine those schools that are 
in critical need and eligible for the program outlined in this Act.
    (d) Information From Federal Agencies.--The Authority may secure 
directly from the Department of the Interior such information as the 
Authority considers necessary to carry out the duties specified in 
section 102. Upon request of the chairperson of the Authority, the head 
of such department or agency shall furnish such information to the 
Authority.
    (e) Postal Services.--The Authority may use the United States mails 
in the same manner and under the same conditions as other departments 
and agencies of the Federal Government.
    (f) Issue Bonds.--The Authority is authorized and empowered to 
issue revenue bonds whose aggregate principal amount at any time shall 
not exceed $200,000,000 and to issue notes, bond anticipation notes, 
and revenue refunding bonds of the authority under the provisions of 
this Act to provide funds for acquiring, constructing, reconstructing, 
enlarging, remodeling, renovating, improving, furnishing, or equipping 
1 or more projects or parts thereof.
    (g) Contracts.--The Authority is authorized and empowered to enter 
into contracts and execute all instruments necessary or appropriate to 
carry out the purposes of this Act.
    (h) Use of Revenues.--The Authority is authorized and empowered to 
pledge, assign, or otherwise encumber as security for the bonds, the 
rentals, revenues, and other income, charges, and moneys realized from 
the use, lease, sale or other disposition of 1 or more projects or 
parts thereof as may be designated in the bond proceedings, and enter 
into trust agreements for the benefit of bondholders.
    (i) Use of Consultants.--The Authority is authorized and empowered 
to employ consulting engineers, architects, attorneys, accountants, 
construction and financial experts, superintendents, managers, and such 
other employees and agents as may be necessary in its judgment, and to 
fix their compensation.
    (j) Receipt of Grants.--The Authority is authorized and empowered 
to receive and accept from any public agency loans or grants for or in 
aid of the acquisition, construction, or refinancing of a project or 
any portion thereof, and to receive and accept loans, grants, aid, or 
contributions from any source of either money, property, labor, or 
other things of value to be held, used and applied only for the 
purposes for which such loans, grants, aid, and contributions are made.
    (k) State and Local Agreements.--The Authority is authorized and 
empowered to enter into appropriate arrangements with any Federal or 
State department or agency, county, township, municipal corporation, or 
other political subdivision, taxing district, or public body or agency 
for the planning and installation of streets, roads, alleys, water 
supply and distribution facilities, storm and sanitary sewage 
collection and disposal facilities, and other necessary appurtenances 
to a project.
    (l) Insurance.--The Authority is authorized and empowered to 
purchase fire and extended coverage and liability insurance for a 
project, and any other insurance the Authority may agree to provide 
under the bond proceedings.

SEC. 104. AUTHORITY PERSONNEL MATTERS.

    (a) Compensation of Members.--Each member of the Authority who is 
not an officer or employee of the Federal Government shall be 
compensated at a rate equal to the daily equivalent of the annual rate 
of basic pay prescribed for level IV of the Executive Schedule under 
section 5315 of title 5, United States Code, for each day (including 
travel time) during which such member is engaged in the performance of 
the duties of the Authority. All members of the Authority who are 
officers or employees of the United States shall serve without 
compensation in addition to that received for their services as 
officers or employees of the United States.
    (b) Travel Expenses.--The members of the Authority shall be allowed 
travel expenses, including per diem in lieu of subsistence, at rates 
authorized for employees of agencies under subchapter I of chapter 57 
of title 5, United States Code, while away from their homes or regular 
places of business in the performance of services for the Authority.
    (c) Staff.--
            (1) In general.--The chairperson of the Authority may, 
        without regard to the civil service laws and regulations, 
        appoint and terminate an executive director and such other 
        additional personnel as may be necessary to enable the 
        Authority to perform its duties. The employment and termination 
        of an executive director shall be subject to confirmation by 
        the Authority.
            (2) Compensation.--The chairperson of the Authority may fix 
        the compensation of the executive director and other personnel 
        without regard to the provisions of chapter 51 and subchapter 
        III of chapter 53 of title 5, United Stated Code, relating 
to classification of positions and General Schedule pay rates, except 
that the rate of pay for such personnel may not exceed the rate payable 
for level V of the Executive Schedule under section 5316 of such title.
    (d) Detail of Government Employees.--Any Federal Government 
employee may be detailed to the Authority without reimbursement, and 
such detail shall be without interruption or loss of civil service 
status or privilege.
    (e) Procurement of Temporary and Intermittent Services.--The 
chairperson of the Authority may procure temporary and intermittent 
services under section 3109(b) of title 5, United States Code, at rates 
for individual which do not exceed the daily equivalent of the annual 
rate of basic pay prescribed for level V of the Executive Schedule 
under section 5316 of such title.

SEC. 105. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--There are authorized to be appropriated to the 
Authority to carry out the purposes of this Act, $13,500,000 for fiscal 
years 1998 through 2000 to begin the pilot project. The rate at which 
the amount shall be appropriated is $2,250,000 for fiscal year 1998, 
$4,500,000 for fiscal year 1999, and $6,750,000 for fiscal year 2000. 
These funds shall be used to supplement the security pool and to make 
annual debt service payments. The funds shall also be used to operate 
the Commission.
    (b) Availability.--Any sums appropriated under this section shall 
remain available, without fiscal year limitation, until expended.

                        TITLE II--PRIVATE BONDS

SEC. 201. ISSUANCE OF BONDS.

    (a) In General.--The Authority shall, by regulation, establish a 
program to provide for the issuance of certificates of participation 
and other debt instruments pursuant to an agreement that the Authority 
shall enter into with a private underwriter to provide funding for 
facility improvement, repair, and new construction of schools of the 
Bureau of Indian Affairs under part B of title XI of the Education 
Amendments Act of 1978 (25 U.S.C. 2001 et seq.) including section 
1126(d) of that Act (25 U.S.C. 2005 and 2006(d)).
    (b) Transfer of Funds.--
            (1) In general.--Notwithstanding any other provision of 
        law, for each fiscal year, the Secretary of the Interior shall 
        transfer to the Secretary of the Treasury $10,000,000 of 
        unobligated funds made available to the Secretary of the 
        Interior by appropriations for advanced planning and design, 
        facility improvement and repair, employee housing construction, 
        and new construction of schools of the Bureau of Indian Affairs 
        pursuant to the authorities specified in subsection (a), 
        including any such funds in the accounts of the Bureau of 
        Indian Affairs commonly known as the ``X'' accounts.
            (2) Debt service payments.--The Secretary of the Treasury 
        shall use any amounts transferred pursuant to paragraph (1) as 
        well as additional future appropriations to make debt service 
        payments to the Authority with respect to the certificates of 
        participation issued under this section. The Authority shall 
        deposit any amount of debt service payment made by the 
        Secretary of the Treasury in an account established by the 
        trustee appointed under subsection (d).
    (c) Issuance of Certificates of Participation.--
            (1) In general.--Notwithstanding any other provision of 
        law, the Authority shall, subject to the availability of funds 
        referred to in subsection (b), enter into an agreement with a 
        private underwriter to sell certificates of participation 
        issued by the Authority in such forms and denominations, 
        bearing such maturities, and subject to such terms and 
        conditions as may be prescribed by the Authority.
            (2) Subject to taxes.--Any Certificate of Participation 
        issued under this section shall be subject to Federal taxes 
        under the Internal Revenue Code of 1986.
            (3) Certificates of participation are not federal 
        obligations; moral obligations.--
                    (A) Certificates of participation issued pursuant 
                to this Act do not--
                            (i) represent or constitute a debt or 
                        pledge of the faith and credit of the Federal 
                        Government; or
                            (ii) grant to the owners or holders thereof 
                        any right to have the Federal Government levy 
                        any taxes or appropriate any funds for the 
                        payment of the principal thereof or interest 
                        thereon.
                    (B) Certificates of participation are payable 
                solely from such funds as are pledged for the payment 
                of the certificates in accordance with certificate 
                proceedings.
                    (C)(i) Certificates of participation are considered 
                moral obligations of the Federal Government in that the 
                Federal Government has a trust responsibility to 
                continue to fund tribal education.
                    (ii) In the event Congress fails to appropriate 
                sufficient money to pay the annual debt service on the 
                certificates of participation, and there is a need to 
                deplete the security pool to pay the annual debt 
                service, the Secretary of the Interior shall request in 
                the next year's budget request funds equal to the 
                amount of the depletion.
    (d) Bond Trustee.--
            (1) In general.--Notwithstanding any other provision of 
        law, any certificate of participation issued by the Authority 
        shall be secured by a trust agreement between the Authority and 
        a trustee.
            (2) Trustee.--Any bank or trust company that meets 
        requirements established by the Authority by regulation may be 
        designated as a trustee under paragraph (1).
            (3) Content of trust agreement.--A trust agreement entered 
        into by the Authority under this subsection shall specify that 
        the trustee, with respect to bonds issued under this section 
        shall--
                    (A) act as a repository for the proceeds of the 
                certificates of participation sold pursuant to this 
                section;
                    (B) make payments to certificate holders;
                    (C) invest such amounts of the proceeds as the 
                trustee determines not to be necessary to make payments 
                under subparagraph (A); and
                    (D) from any amounts in excess of the amounts 
                necessary to make payments to bondholders, in 
                accordance with the requirements of paragraph (4), make 
                direct payments to contractors with the Secretary, the 
                governing body of an Indian tribe, or the appropriate 
                official of a school of the Bureau of Indian Affairs 
                for facility improvement, repair, or new construction 
                pursuant to an authority specified in subsection (a).
            (4) Requirements for making direct payments.--
                    (A) In general.--Notwithstanding any other 
                provision of law, only the trustee shall make the 
                direct payments referred to in paragraph (3)(D) in 
                accordance with requirements that the Authority shall 
                prescribe in the agreement entered into under paragraph 
                (3). The Authority shall require the trustee, prior to 
                making a payment to a contractor under paragraph 
                (3)(D), to inspect the project that is the subject of 
                the contract, or provide for an inspection of that 
                project by a local financial institution to ensure the 
                completion of the project.
                    (B) Contracts.--Each contract referred to in 
                paragraph (3)(D) shall specify, or be renegotiated to 
                specify, that payments under the contract shall be made 
                in accordance with this subsection.

                  TITLE III--MISCELLANEOUS PROVISIONS

SEC. 301. ANNUAL REPORT.

    The Authority shall keep an accurate account of all of its 
activities and all of its receipts and expenditures and shall annually 
make a report thereof to the Secretary of the Interior. The Secretary 
of the Interior shall review and comment upon the report and make such 
recommendations as the Secretary deems necessary to the Congress of the 
United States and Indian nations.

SEC. 302. SOVEREIGN IMMUNITY.

    This Act shall not be construed so as to impact, limit, or affect 
the current sovereign immunity of the tribal, State or Federal 
governments.

SEC. 303. COORDINATION WITH BUREAU OF INDIAN AFFAIRS.

    This pilot project shall coordinate with the Bureau of Indian 
Affairs by utilizing Public Law 93-638, section 102 authority, or 
Public Law 100-297 which allow tribes to assume direct management over 
school construction projects. The funding package developed in this Act 
shall be used for all projects within the National Indian Bonding Pilot 
Project. The pilot project will focus on critical need projects within 
the grant and contract schools across the country. Nothing in these 
regulations shall be construed to:
            (1) Mandate a tribe to apply for a contract or contract 
        with the Bureau of Indian Affairs to plan, conduct, and 
        administer all or parts of any Bureau program. Such 
        applications under these regulations are strictly voluntary.
            (2) Authorize or require the termination of any trust 
        responsibility of the United States with respect to the Indian 
        people.
            (3) Permit significant reduction in services to Indian 
        people as a result of this Act.
                                 <all>