    [House Hearing, 106 Congress]
    [From the U.S. Government Publishing Office]

     H.R. 946, H.R. 2671, AND H.R. 4148 (YOUNG, R-AK)--TO MAKE TECHNICAL
      AMENDMENTS TO THE PROVISIONS OF THE INDIAN SELF-DETERMINATION AND
     EDUCATION ASSISTANCE ACT RELATING TO CONTRACT SUPPORT COSTS, AND FOR
    OTHER PURPOSES. ``TRIBAL CONTRACT SUPPORT COST TECHNICAL AMENDMENTS OF
                                    2000''.

    =======================================================================

                               OVERSIGHT HEARING

                                   before the

                             COMMITTEE ON RESOURCES
                            HOUSE OF REPRESENTATIVES

                           ONE HUNDRED SIXTH CONGRESS

                                 SECOND SESSION

                                   __________

                          MAY 16, 2000, WASHINGTON, DC

                                   __________

                               Serial No. 106-95

                                   __________

               Printed for the use of the Committee on Resources

     Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                     house
                                       or
               Committee address: http://www.house.gov/resources

                                   __________

                        U.S. GOVERNMENT PRINTING OFFICE
    68-434                     WASHINGTON : 2001

    _______________________________________________________________________
     For sale by the Superintendent of Documents, U.S. Government Printing
                                     Office
    Internet: bookstore.gpo.gov  Phone: (202) 512-1800  Fax: (202) 512-2250
                   Mail: Stop SSOP, Washington, DC 20402-0001

                             COMMITTEE ON RESOURCES

                          DON YOUNG, Alaska, Chairman
    W.J. (BILLY) TAUZIN, Louisiana       GEORGE MILLER, California
    JAMES V. HANSEN, Utah                NICK J. RAHALL, II, West Virginia
    JIM SAXTON, New Jersey               EDWARD J. MARKEY, Massachusetts
    ELTON GALLEGLY, California           BRUCE F. VENTO, Minnesota
    JOHN J. DUNCAN, Jr., Tennessee       DALE E. KILDEE, Michigan
    JOEL HEFLEY, Colorado                PETER A. DeFAZIO, Oregon
    JOHN T. DOOLITTLE, California        ENI F.H. FALEOMAVAEGA, American
    WAYNE T. GILCHREST, Maryland             Samoa
    KEN CALVERT, California              NEIL ABERCROMBIE, Hawaii
    RICHARD W. POMBO, California         SOLOMON P. ORTIZ, Texas
    BARBARA CUBIN, Wyoming               OWEN B. PICKETT, Virginia
    HELEN CHENOWETH-HAGE, Idaho          FRANK PALLONE, Jr., New Jersey
    GEORGE P. RADANOVICH, California     CALVIN M. DOOLEY, California
    WALTER B. JONES, Jr., North          CARLOS A. ROMERO-BARCELO, Puerto
        Carolina                             Rico
    WILLIAM M. (MAC) THORNBERRY, Texas   ROBERT A. UNDERWOOD, Guam
    CHRIS CANNON, Utah                   PATRICK J. KENNEDY, Rhode Island
    KEVIN BRADY, Texas                   ADAM SMITH, Washington
    JOHN PETERSON, Pennsylvania          CHRIS JOHN, Louisiana
    RICK HILL, Montana                   DONNA MC CHRISTESEN, Virgin
    BOB SCHAFFER, Colorado                   Islands
    JIM GIBBONS, Nevada                  RON KIND, Wisconsin
    MARK E. SOUDER, Indiana              JAY INSLEE, Washington
    GREG WALDEN, Oregon                  GRACE F. NAPOLITANO, California
    DON SHERWOOD, Pennsylvania           TOM UDALL, New Mexico
    ROBIN HAYES, North Carolina          MARK UDALL, Colorado
    MIKE SIMPSON, Idaho                  JOSEPH CROWLEY, New York
    THOMAS G. TANCREDO, Colorado         RUSH D. HOLT, New Jersey

                         Lloyd A. Jones, Chief of Staff
                       Elizabeth Megginson, Chief Counsel
                  Christine Kennedy, Chief Clerk/Administrator
                    John Lawrence, Democratic Staff Director

                                C O N T E N T S

                                  ----------
                                                                       Page

    Hearing held May 16, 2000........................................     1

    Statement of Members:
        Barrett, Hon. Bill, a Representative in Congress from the
          State of Nebraska, Prepared Statement of...................   116
        Miller, Hon. George, a Representative in Congress from the
          State of California, Prepared Statement of.................    97
        Woolsey, Hon. Lynn C., a Representative in Congress from the
          State of California........................................    66
            Prepared Statement of....................................    69
        Young, Hon. Don, a Representative in Congress from the State
          of Alaska..................................................     1
            Prepared Statement of....................................     4

    Statement of Witnesses:
        Allen, W. Ron, Vice President, National Congress of American
          Indians, Washington, DC....................................    51
            Prepared Statement of....................................    53
        Archambeau, Ms. Madonna, Chairwoman, Yankton Sioux Tribe,
          Marty, South Dakota........................................    85
            Prepared Statement of....................................    87
        Denny, Mr. Arthur ``Butch'', Chairman, Santee Sioux Tribe of
          Nebraska, Niobrara, Nebraska...............................    90
            Prepared Statement of....................................    92
        Gover, Hon. Kevin, Assistant Secretary, Bureau of Indian
          Affairs, Washington, DC....................................     8
            Prepared Statement on H.R. 4148..........................    10
            Prepared Statement on H.R. 2671..........................    83
            Prepared Statement on H.R. 946...........................   105
        Narcia, Richard, Lt. Governor, Gila River Indian Community,
          Sacaton, Arizona...........................................    43
            Prepared Statement of....................................    45
        Sarris, Greg, Chairman, Federated Indians of Graton
          Rancheria, Novato, California..............................    72
            Prepared Statement of....................................    74
        Smith, Hon. Chad, Principal Chief, Cherokee Nation,
          Tahlequah, Oklahoma........................................    36
            Prepared Statement of....................................    38
        Trujillo, Dr. Michael H., Director, Indian Health Service,
          Rockville, Maryland........................................    15
            Prepared Statement of....................................    17
        Williams, Orie, Executive Vice President, Yukon Kuskokwim
          Health Corporation, Bethel, Alaska.........................    27
            Prepared Statement of Gene Peltola, President and Chief
              Executive Officer, The Yukon Kuskokwim Health
              Corporation............................................    30

    Additional material supplied:
        Briefing Paper, H.R. 946.....................................   100
        Briefing Paper, H.R. 2671....................................   101
        Briefing Paper, H.R. 4148....................................   102
        Janklow, William, Prepared Statement of......................   115
        Mississippi Band of Choctaw Indians et al. Statement
          regarding impact of H.R. 4148..............................   112

      H.R. 946, H.R. 2671, AND, H.R. 4148 (YOUNG, R-AK) TO MAKE TECHNICAL
       AMENDMENTS TO THE PROVISIONS OF THE INDIAN SELF-DETERMINATION AND
     EDUCATION ASSISTANCE ACT RELATING TO CONTRACT SUPPORT COSTS, AND FOR
    OTHER PURPOSES. ``TRIBAL CONTRACT SUPPORT COST TECHNICAL AMENDMENTS OF
                                    2000''.

                                  ----------

                             TUESDAY, MAY 16, 2000

                      House of Representatives,
                                Committee on Resources,
       Washington, DC. of I21The Committee met, pursuant to notice, in
    room 1324 Longworth House Office Building, Hon. Don Young (chairman
                                           of the Committee) presiding.

        The Chairman. Where is Mr. J.D. Hayworth? I ask unanimous
    consent that Congressman J.D. Hayworth be allowed to sit on the
    dais and participate in the Committee during this hearing.
    Without objection, so ordered.
        We're going to change the order of business today. We're
    going to take up --H.R. 4148. That's a prerogative of the
    chairman. I would suggest that the first panel, the Honorable
    Kevin Gover, Assistant Secretary of the Bureau of Indian
    Affairs; and Dr. Michael Trujillo, Director of the Indian
    Health Service, Rockville, Maryland, be seated at the panel.
        I would like to extend my welcome to all of my Alaskan
    constituents. I would especially like to thank everyone for
    their help in drafting H.R. 4148, a bill that makes technical
    amendments to the Contract Support Costs Provisions in the
    Indian Self-Determination Act. These amendments are long
    overdue. We held our first hearings on contract support costs
    on February 24, 1999, accepting testimony from tribes and the
    Administration. Additionally, the Interior Appropriations
    Subcommittee requested a report from the General Accounting
    Office regarding contract support costs and to provide Congress
    with alternatives to the existing problems.
        On August 3, 1999, we held a hearing to accept testimony
    from the Administration, the National Congress American
    Indians, and their work with the National Policy Work Group on
    contract support costs, and from the General Accounting Office
    on their final report to Congress and what alternatives that
    they recommend with regard to the contract support costs
    shortfalls.
        H.R. 4148 is a result of the National Congress of American
    Indians National Policy Work Group and the Administration's
    efforts to resolve contract support costs problems. This is our
    first hearing on the bill, and I would like to state my many
    thanks to all the tribes for all their input and patience on
    this important issue.
        On a sideline, may I suggest this has been a battle we have
    been fighting for the last six years. This Committee thinks
    it's very unfortunate that we can't reach an agreement on how
    these contract support costs can be established in a stabilized
    manner (without all the fluctuation which has occured in the
    present system). I think it's very unfortunate that many of our
    tribes and many of our villages do not know for sure that
    they're going to receive any of the moneys, which were
    guaranteed under the negotiated contracts. So, I hope this
    bill, H.R. 4148, will solve some of these problems. I realize
    there is some opposition to the bill, but I hope those that are
    opposed to it would reconsider and deeply search their souls. I
    understand this is a problem and I'd like to see it resolved
    before we adjourn this session.
        I will recognize the ranking member, Mr. Kildee, for an
    opening statement.
        Mr. Kildee. Thank you, Mr. Chairman. It's great to sit up
    here with Mr. J.D. Hayworth. J.D. and I are Co-Chairs of the
    Native American Caucus. We jokingly say sometimes when we see
    our votes the same up there, it must be an Indian bill, because
    that's one thing that J.D. and I always agree on. We have other
    agreements, too.
        Mr. Chairman, this hearing will provide us an opportunity
    to again examine contract support costs. Last year, this
    Committee held two hearings on this issue. The GAO released its
    report last summer, offering four alternatives for funding
    contract support costs, and the National Congress of American
    Indians also released its report last year, making several
    recommendations.
        Mr. Chairman, in March of this year, you introduced H.R.
    4148, that would, among other things, make contract support
    costs funding an entitlement. While I'm in support of this
    measure, I hope that as the bill moves forward, you will
    continue to work with me to address the concerns raised by the
    administration regarding this bill, so we can get this bill
    signed into law.
        I look forward to hearing today's testimony and I thank
    you, again, Mr. Chairman, for the introduction of this bill,
    Mr. Hayworth, and for this hearing today.
        The Chairman. Thank you. Mr. Hayworth?
        Mr. Hayworth. Chairman Young, let me begin by saying how
    honored I am that you've asked me to participate in this
    hearing today on this legislation. I welcome my friend from
    Michigan, Co-Chair of the Native American Caucus, and others on
    the other side of the aisle, because this is an issue that
    transcends partisan politics. I think we are all deeply
    concerned about the contract support costs funding issue and I
    strongly believe we need to work toward a sustainable solution
    that ensures the Federal Government will meet its legal
    obligation to tribes to help them carry out the management of
    their health and social services programs.
        Mr. Chairman, I was pleased to work with you on the
    development of H.R. 4148. This legislation has been a
    cooperative effort, with input from many tribes and tribal
    organizations, including the National Congress of American
    Indians National Policy Work Group. H.R. 4148 is, also, the
    result of the Administration's efforts to resolve contract
    support costs problems and includes recommendations from the
    Government Accounting Office.
        I'd like to thank all of the individuals, who will testify
    before the Committee today and I'd like to extend a special
    welcome to Lt. Governor Richard P. Narcia and Franklin P.
    Jackson of the Gila River Indian Community, located in my
    district back in Arizona. Lt. Governor Narcia will provide an
    important example of the critical need for full contract
    support costs funding and the special challenges that all
    tribes are facing, as they attempt to operate effective tribal
    programs responsive to their respective community needs. I
    pledge my continued commitment to working toward a single,
    consistent Federal policy that applies to all self-
    determination contracts and self-governance compacts. The end
    result must provide stability and predictability, so tribes can
    move forward to successfully implement their tribal programs
    and the self-determination policy.
        I believe that H.R. 4148 is a good starting point. I look
    forward to receiving additional comments today on this
    legislation from tribal representatives, the Committee, and the
    Administration, as we work toward enactment of this important
    bill. Again, Mr. Chairman, I thank you and I thank the other
    members of the Committee for the opportunity to be here.
        [The prepared statement of Hon. Don Young follows:]
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        [GRAPHIC] [TIFF OMITTED] T8434.002

        [GRAPHIC] [TIFF OMITTED] T8434.003

        [GRAPHIC] [TIFF OMITTED] T8434.004

        The Chairman. I thank the gentleman. Mr. Kevin Gover,
    you're the first witness.

     STATEMENTS OF THE HONORABLE KEVIN GOVER, ASSISTANT SECRETARY,
     BUREAU OF INDIAN AFFAIRS, WASHINGTON, DC.; AND DR. MICHAEL H.
     TRUJILLO, DIRECTOR, INDIAN HEALTH SERVICE, ROCKVILLE, MARYLAND

        Mr. Gover. Thank you, Mr. Chairman. It's always a pleasure
    to appear before the Committee. We thank the Committee and the
    chair, in specific, for taking on this issue. I know that the
    chair was reluctant to enter into the Indian Self-Determination
    Act, at this time, and, nevertheless, we do think that some
    clarifications are necessary, in order to finally address this
    issue of contract support.
        Let me lay out the background for our testimony and then
    get into some of the specifics. The administration does support
    the goal of full funding of contract support costs for Indian
    tribes and has proposed increases in the Fiscal Year 2001
    budget for contract support. We, also, believe that the effort
    to reach full funding should be accompanied by timely reporting
    and auditing of the use of these contract support costs, as
    required of other Federal agencies. We understand that the
    contract support issue is one of the primary impediments to the
    full implementation of the Self-Determination Act. The idea
    behind the Act is to systematically move the Bureau of Indian
    Affairs out of positions of making decisions under the delivery
    of services to Indian communities; invest those decisions in
    tribal governments. We support that proposition and we believe
    that the resolution of this issue will assist in that process.
        We do have several concerns regarding H.R. 4148. We think
    most of them are issues that can be worked through. We do have
    to point out our concern that here we are talking about clearly
    wanting to spend more money in Indian country through BIA and
    through IHS and through these tribal contracting procedures. At
    the same time, the Congress has under consideration a budget
    resolution that doesn't seem to leave much room for the sort of
    expansion of these programs that we're hoping for.
        In my testimony, Mr. Chairman, we've identified some
    specific concerns and they just demonstrate how tricky this
    area is and how we can easily impose unintended consequences
    when we're not careful with the kind of language that is used.
    We would like to work with the Committee to address the
    concerns that we identify in the legislation. I don't think
    that they really need to be belabored here. But, we do
    encourage the Committee to continue addressing this issue, to
    work with us and with the tribes, to try to find a solution to
    the problem.
        We have had a great deal of conversation within the
    administration concerning the specific provisions of this bill
    and, in particular, the issue of moving contract support costs
    to the mandatory side of the budget. The current status of
    those discussions is that we are prepared to say that were the
    Congress to identify offsets satisfactory to the
    administration, that we would not oppose that proposition. That
    is the result of a great deal of deliberation and debate,
    within the administration, but I feel safe in saying that
    that's where we are at this point.
        We would like to work with the Committee to identify those
    offsets and address the specifics of how we go about
    calculating these contract support costs. If we can resolve
    this matter, put the Bureau of Indian Affairs (BIA) and Indian
    Health Services (IHS) on a smoother trail toward understanding
    what our contract support obligations are and how they're going
    to be funded, then the tribes will have the kind of security
    and the annual funding that they really require to do
    meaningful planning for the delivery of services.
        Mr. Chairman, that is my testimony this morning. As I say,
    we've submitted some more specific comments for the record, to
    indicate some of the complications that we've identified in the
    bill. We do think those complications can be worked out and
    look forward to working with the Committee on trying to resolve
    these issues.
        [The prepared statement of Kevin Gover follows:]

        [GRAPHIC] [TIFF OMITTED] T8434.005

        [GRAPHIC] [TIFF OMITTED] T8434.006

        [GRAPHIC] [TIFF OMITTED] T8434.007

        [GRAPHIC] [TIFF OMITTED] T8434.008

        [GRAPHIC] [TIFF OMITTED] T8434.009

        The Chairman. I thank you, Mr. Secretary. Dr. Trujillo?

                  STATEMENT OF DR. MICHAEL H. TRUJILLO

        Dr. Trujillo. Yes, good afternoon, Mr. Chairman and
    Committee members. Today with me, in case there are any
    specific questions, are Mr. Michael Lincoln, Deputy Director of
    the Indian Health Service, and Mr. Douglas Black, the Director
    of our Tribal Affairs Program.
        The Indian Health Service has testified twice previously
    this session of Congress on the importance of contract support
    costs, on the promotion of strong stable tribal governments and
    the provisions, certainly, of quality costs health care. I come
    to you today in support of your continued efforts to address
    the contract support costs issues. This bill before us contains
    provisions that the Indian Health Service supports. However,
    there are, also, other provisions within the bill that are of
    concern to the Indian Health Service and we would be very
    willing to work with you, the Committee members, tribal
    leadership, to address our areas of concern.
        When I last testified before this Committee, I spoke about
    our efforts to work with tribal governments, to develop a
    revised policy to allocate contract support costs in Fiscal
    Year 2000. In January of this year, I adopted a revised policy,
    which now governs the administration in allocation of the
    contract support costs for the Indian Health Service. That
    policy was developed as a result of very extensive tribal
    consultation and collaboration to date, regarding contract
    support costs, and has received the formal endorsements of
    major national Indian organizations and tribal governments.
        The revised policy establishes allocation procedures that
    are intended, over a period of time, to reduce the disparity of
    contract support costs funding among tribes in our system
    without reducing contract support costs funding for tribes that
    are still underfunded. The allocation procedures were developed
    to address the present environment, in which available contract
    support costs appropriated are insufficient to fund the total
    contract support costs need.
        This bill we are discussing today contains provisions that
    legislate the full funding of contract support costs. At the
    crux of the contract support costs dilemma and controversy are
    provisions in the Indian Self-Determination Act that seemingly
    are in conflict with each other. One law directs the Secretary
    to fund the full amount of need for such costs; elsewhere, the
    Act provides that contract funding is subject to the
    availability of appropriations. As a result, the Indian Health
    Service continues to be involved in litigation over contract
    support costs issues that are rooted in this confusion.
        The provisions of H.R. 4148 that require the full funding
    of contract support costs would address and essentially end the
    confusion over contract support costs by amending the Act,
    fully funding these costs. Although I have been a strong
    advocate for increased contract support costs funding
    throughout my tenure as the Director of the Indian Health
    Service, I am very concerned about this provision. This bill
    does not specify the source of funding that will be used to
    fully address the contract support costs and I would be opposed
    to funding for contract support costs that comes from any other
    existing or future Indian Health Service appropriations for the
    health care programs and services and which supersede other
    critical priorities for budget increase for all Indian Health
    Service-funded health programs, especially for those tribes who
    chose not to assume direct management of their health care
    programs.
        I do believe that there are provisions in the bill worthy
    of consideration, including provisions to enlarge the current
    self-determination proposal review period from 90 to 180 days
    and one that reconstitutes--reinstates congressional reporting
    requirements, to assist you in your future consideration of
    contract support costs issues. There are, also, provisions of
    the bill that either the Indian Health Service, the Department,
    and the administration cannot support, and others would require
    further modification and review before they are supported. A
    discussion of these provisions is contained in my written
    formal statement that was submitted earlier.
        In closing, I would, again, like to express my support for
    contract support costs and the activities of this particular
    committee. I continue to be of the opinion, as I have testified
    previously, that carefully drafted regulations governing
    contract support costs are still desirable and that the
    development of such regulations can be best accomplished
    through the negotiated rulemaking process. The Indian Health
    Service would welcome the opportunity to join with tribes,
    other Federal agencies, such as the Bureau of Indian Affairs
    and the Office of the Inspector General, in such a process, if
    authorized by Congress. I would close by emphasizing that the
    Indian Health Service is committed to upholding, promoting, and
    strengthening principles of the Self-Determination Act, the
    empowerment of tribal governments, and the government to
    government relationship that exist between Indian nations and
    this country. Thank you for this opportunity.
        [The prepared statement of Michael Trujillo follows:]

        [GRAPHIC] [TIFF OMITTED] T8434.010

        [GRAPHIC] [TIFF OMITTED] T8434.011

        [GRAPHIC] [TIFF OMITTED] T8434.012

        [GRAPHIC] [TIFF OMITTED] T8434.013

        [GRAPHIC] [TIFF OMITTED] T8434.014

        [GRAPHIC] [TIFF OMITTED] T8434.015

        [GRAPHIC] [TIFF OMITTED] T8434.016

        The Chairman. I thank both of you. I'm somewhat pleased
    with your testimony and somewhat discouraged, because this has
    been a problem for about 6 years or longer. As I mentioned in
    my opening statement, I hope we can reach a solution. Because
    if I remember right, both you, Mr. Secretary, and you, Dr.
    Trujillo, that this is the third time that you've appeared
    before this Committee and said you supported it. We have a bill
    that does that and now we have opposition from your
    Administration. Although, Mr. Secretary, I think if I
    understood you correctly, you would support it, if we find the
    offsets. Is that correct?
        [No response.]
        The Chairman. I know who is looking over your shoulder and
    I know who is in this room. You answer freely, because I will
    protect you, believe me.
        Mr. Gover. I'm trying to pick my words carefully. What I
    don't want to be saying is we're putting the burden on you to
    find the offsets. I think the Administration shares that
    burden. All we mean to say, at this point, is that the offsets
    should be satisfactory to both Congress and the Administration
    and we will need to work with you, to try to figure out what
    that is. The point of my testimony was not just to slough the
    burden off onto the Committee and onto the Congress.
        The Chairman. Well, I'm saying that's the biggest hold up,
    as far as you're concerned, in the bill. The Doctor seems to
    have some other problems. But, again, I go back to: if we don't
    correct this now, it will always be an uncertainty for tribal
    health care, because we don't know if they've received enough
    funds or not.
        Mr. Gover. I agree with you, Mr. Chairman.
        The Chairman. OK. You know, again, as long as we have that
    understanding. Are you communicating with the tribes all the
    time and trying to find the solution? Is that occurring?
        Mr. Gover. We have put a lot of effort into working with
    the tribes on this issue. I think it's fair to say IHS has put
    even more effort into working with the tribes on this issue. I
    believe that this bill represents a solid step forward and that
    it would bridge a lot of the problem between our position and
    the tribes. Obviously, we would be much more open in adding
    additional elements of costs to our contract support formulas,
    if we knew that the money was going to be there. What we don't
    want to do is make agreements with the tribes, as to what are
    the appropriate elements of contract support, knowing full well
    that they are not likely to be funded, because that's just a
    broken promise to the tribes. I've been holding the line in the
    discussions with the tribes, saying, look, let's not pile on
    more costs, until we have some understanding of how they're
    going to be paid for.
        If the Congress and the Administration agreed on a solution
    as to the funding of contract support costs, I believe it
    becomes a much easier exercise to agree on what the elements of
    contract support costs should be.
        The Chairman. Offsets do not have to come out--the Doctor
    said, out of the existing health services. Offsets can come out
    from anywhere within the budget. Is that your understanding?
        Mr. Gover. That's my understanding, Mr. Chairman.
        The Chairman. OK. For instance, we have--I'm going to pick
    on the Administration, The Administration now wants to get some
    of the funding out of the tobacco settlement and spend it for
    other purposes. That tobacco settlement could be used for
    contract support costs (as an offiset). Would that be a correct
    interpretation?
        Mr. Gover. I can't speak for the Administration, as to
    whether or not to encourage the Committee to look to the
    tobacco settlement money for an appropriate offset. But, yes,
    it's my understanding that an offset could come from any part
    of the Federal budget.
        The Chairman. This is ignorance on my part, would we have
    to find an offset every year or is there any way, again, that
    we can provide stability in the funding? Because once we passed
    the Self-Determination Act, we tried to make sure that there
    was the money available, and we haven't done that. And that
    uncertainty has caused shortfall problems. Is there any way we
    can write this bill, so that there isn't uncertainty?
        Mr. Gover. I believe so, Mr. Chairman. I believe that we
    could identify an offset that would continue just the same as
    this increase in spending would be continuing over some number
    of years.
        The Chairman. My time is about up. The gentleman from
    California?
        Mr. Miller. Thank you, Mr. Chairman. I just want to thank
    the panel for their testimony and I agree with the dialogue
    that you just had, that we've got to come up with the offsets.
    I think your bill does it right. I think we should just
    recognize that these are the costs and we've got to take them
    out of the ongoing general revenues of the government, instead
    of believing that we're somehow going to trade this off between
    law enforcement and Indian health, or other services that we
    already know are inadequately funded. This is part of the price
    of self-determination. The program is working and I think your
    legislation speaks to it quite correctly. And if saying that
    we've got to look for offsets just is another way to keep
    postponing this year after year, then we're obviously just
    robbing already inadequate sources. So, that won't work. And so
    I think, at some point, we have to sit down with the
    Administration and make a decision about that, because that
    holds everybody in abeyance, but it doesn't solve the problem.
    And there clearly are sufficient revenues to deal with the
    contract costs.
        I want to thank you, very much, and I appreciate the
    problem that's being presented by the position of the
    Administration here, but I think we've got to get on and solve
    this issue. As you have pointed out, we have now punted three
    years in a row on this and that's not helping anyone.
        The Chairman. Mr. Hayworth?
        Mr. Hayworth. I just want to thank both the chairman, and
    the ranking member and these two gentlemen for their testimony.
    I think we have the context where at long last we need to act.
    And while I think we've documented the problem and they've
    outlined their concerns, I would concur with both the chairman
    and the ranking member, it's time to get this done.
        The Chairman. Mr. Kildee?
        Mr. Kildee. Thank you, very much, Mr. Chairman. I think we
    have to work together to identify those offsets and I think
    they have to be in the whole Federal Government, because I
    don't know of any Indian program that we haven't been penny
    pinching in my 24 years here in the Congress. So, I hate to
    take money from another Indian program for this very good thing
    here, because we've been penny pinching for so many years. So,
    I think it's very important that we sit down, not delay, get on
    immediately and identify some offsets from other areas of
    government, not Indian programs, so we can do this. And I think
    that should be our top priority, because the effects of not
    providing full funding for contract support costs is really a
    terrible defect.
        I think--this is more than just a legal matter. I think
    it's a moral matter. I think J.D. Hayworth and I agree upon,
    this is something very--a moral matter, that we really should
    be fully funding this and make this an entitlement, find some
    offsets. But, I think that we should not wait until next month.
    We should start working today or tomorrow on identifying those
    offsets and not from other areas where we are already
    underfunding Indian programs.
        I've been in Congress for 24 years and I have yet to see
    where, when I've traveled throughout the country or looked at
    the books, that we're over funding our responsibilities in our
    sovereign-to-sovereign relationship and our trust
    responsibilities to the Indians. So, Kevin and Dr. Trujillo, we
    look forward to working with you starting today, to try to
    identify those offsets. And I think that we have, I think, a
    very important bill here. We can move forward in our support.
        I yield back the balance of my time.
        The Chairman. Thank you. The gentleman from Maryland?
        Mr. Gilchrest. No questions, at this time, Mr. Chairman.
        The Chairman. All right. I've got a great offset. I know
    this is going to stir the pot up, but the Senate is considering
    the pullout of Kosovo. We're spending approximately 20 times
    the budgets for Indian Health in that activity alone. And once
    they pull out, maybe we can apply that money for something that
    helps us in the great United States of America.
        I want to thank the panel. We'll be in communications. I
    was very kind to you today, because I heard what was being said
    behind the words that were being said, that we want to work
    together. And I will be talking to OMB to find out what their
    problem is, because this is an issue and a commitment that
    should have been met a long time ago. If we believe in the
    Self-Determination, and Congress said we did, that's not up to
    the Administration not to fully fund programs. It's up to us to
    make sure that Self-Determination is fully funded, especially
    the contracting part of it. So, I do thank both of you and we
    will be in communication with you. And you are excused for this
    panel. I think one of you is up for the next bill. Kevin, I
    think you are.
        The next panel, H.R. 4148, the next panel: Mr. Orie
    Williams, Executive Vice President, Yukon Kuskokwim Health
    Corporation, Bethel, Alaska; the Honorable Chad Smith,
    Principal Chief, Cherokee Nation, Tahlequah, Oklahoma; Mr.
    Richard Narcia, Lt. Governor, Gila River Indian Community,
    Sacaton, Arizona; and Mr. W. Ron Allen, Vice President,
    National Congress of American Indians, Washington, DC.
        Mr. Williams? Turn your mike on. There you go.

     STATEMENTS OF ORIE WILLIAMS, EXECUTIVE VICE PRESIDENT, YUKON
     KUSKOKWIM HEALTH CORPORATION, BETHEL, ALASKA; HONORABLE CHAD
     SMITH, PRINCIPAL CHIEF, CHEROKEE NATION, TAHLEQUAH, OKLAHOMA;
      RICHARD NARCIA, LT. GOVERNOR, GILA RIVER INDIAN COMMUNITY,
       SACATON, ARIZONA; W. RON ALLEN, VICE PRESIDENT, NATIONAL
              CONGRESS OF AMERICAN INDIANS, WASHINGTON, DC

                       STATEMENT OF ORIE WILLIAMS

        Mr. Williams. For the record, my name is Orie Williams and
    I'm the Executive Vice President of the Yukon Kuskokwim Health
    Corporation. Thank you for the opportunity to testify this
    morning on H.R. 4148.
        I would like to begin my testimony by putting H.R. 4148
    into perspective, our perspective. The Yukon Kuskokwim Health
    Corporation serves as a consolidated and only health care
    provider for 25,000 people in 58 Federally-recognized Alaskan
    native villages. It's spread across 85,000 square miles of
    roadless area the size of the State of South Dakota.
        Poor health and a subsistence lifestyle have led some of
    the compared conditions in many of our villages to those facing
    Third World nations. Our people live on the most over regulated
    lands in the nation. Mr. Chairman, that is no exaggeration.
    Besides the subsistence--besides subsistence, the largest
    economy in the region is government, including our YKHC health
    system. There is no viable commercial fishing, forest, or other
    resource development industry that can offset the statistics.
        The unemployment rate exceeds 80 percent and most of our
    village homes still have a six gallon plastic bucket for a
    toilet. That's not all. Our villages post neonatal mortality is
    more than double the average U.S. rate. Death by suicide is
    four times the national rate. Fetal alcohol syndrome and fetal
    alcohol affect are rampant. And despite recent increases in
    congressional appropriations, the lack of adequate sewer and
    water systems still leave over many of our communities victims
    of every known infectious disease.
        What have we done to meet some of these challenges? Our
    tribal government is working together under the Indian Self-
    Determination Act. I've replaced the Indian Health Service and
    directly administer 47 village clinics; one mid level sub
    regional clinic, with two more under construction; a 51 bed
    hospital; and over 11,000 employees. Since taking over daily
    operation of the Indian Health Service system, we have
    witnessed tremendous improvements in the delivery of health
    care. But, the contracts support shortfall we have faced each
    year, over $2.3 million each year, has consistently crippled
    our ability to do more.
        As our written testimony details, the shortfall has meant
    deficiencies in our accounting department, our medical coding
    and billing department, and our hospital facilities maintenance
    programs. The shortfall has, also, required us to transfer
    funds away from key programs and has impaired our ability to
    enhance our substance abuse and mental health services, our
    home elder care, and our health prevention education programs
    to many of our villages. To those unfamiliar with health care
    conditions in rural Alaska, our contract support costs deficit
    is just a number. But for us working out there in the trenches,
    it is having a corrosive impact on the quality of our health
    care system and may, in fact, lead to layoffs and salary
    reductions.
        Mr. Chairman, for nearly 20 years, the Administration and
    Congressional Committees have all acknowledged the grave impact
    caused by contract support costs shortfalls. For nearly 20
    years, the contract support costs system has been studied and
    restudied and restudied. The last time, read the GAO's June
    1999 report.
        Never until H.R. 4148 have we seen a solution that fully
    and completely addresses the problem, so that there are no more
    shortfalls and no more court cases and we can get on with the
    process of tribal self-determination without reducing the very
    government programs we are charged to carry out. Contract
    support shortfall creates--cheats the tribes and punishes our
    people. It's not how the country deals with other government
    contractors, be it General Electric or Boeing, and it's not the
    way the country should deal with Indian tribes.
        Just yesterday an article in the Wall Street Journal
    reported a GAO study that confirmed that the U.S. Congress
    spent $2.2  billion to subsidize sugar growers in America.
    Isn't it ironic that in the same--that is the same amount spent
    for all of Indian health care in America. It is ironic, also,
    that the subsidy--the historical subsidy of the tobacco
    industry, greater than all of the resources spent on the health
    care of the Americans worse people, are industries, whose
    products caused some of the greatest health risk to Native
    American, and probably up to 30 percent of our costs.
        Since my time is short, I respectfully refer the Committee
    to my written testimony for comments on the balance of the
    bill. I would note, however, that the consolidation initiative
    proposed in Section 2 is a novel and innovative new way to deal
    with contract support costs issues. The consolidation
    initiative answers those, who are concerned that somehow tribes
    have insufficient incentives to maximize the efficiency and the
    operation of their health programs. While we find such
    criticisms demeaning, we recognize that this option, first put
    forward by the General Accounting Office, does provide a better
    way for Congress to predict contract support costs requirements
    from one year to the next.
        Mr. Chairman, many years ago, Congress failed--failed to
    fully fund contract support costs, the single most serious
    problem with implementation of the Indian Self-Determination
    Act. H.R. 4148 will at long last firmly and finally solve that
    problem. Nationally, the cost of the bill is negligible. For us
    in the trenches on Indian reservations in Alaskan native
    villages, the financial stability we will regain will translate
    in desperately needed care for American Indian and Alaska
    native people. They are far beyond the reach of our nation's
    typical health care system.
        I praise the chairman and Congressman Hayworth and others
    for introducing this legislation; Congressman Miller and other
    members of the Native American Caucus for their continued
    support for self-determination and self-governance. I
    respectfully urge that the Committee move this bill forward as
    quickly as possible, so that it can be enacted this year.
        Mr. Chairman, with your indulgence, I would like to close
    my testimony with the request for the Committee to observe a
    moment of silence for one of the nation's greatest Indian
    leaders, Mr. Joe De La Cruz, a champion in tribal rights of the
    Indian Self-Determination Act throughout his life, even up to
    the day he died of a major heart attack on April 16th, on the
    way to a national Indian Health Service tribal conference.
    Thank you.
        [The prepared statement of Orie Williams follows:]

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        The Chairman. Without objection, a moment of silence.
        [Moment of silence.]
        The Chairman. Thank you and I can tell you that Mr. De La
    Cruz was one of my favorite people who testified before this
    Committee and his was an unfortunate death. We never know why
    God reaches down and takes us.
        I'm going to use my discretion here, as I do have another
    appointment, I'm going to have Mr. Gilchrest take over the
    hearing. But before I do, I want to ask Orie two questions. One
    is you mention the shortfall of $2.5 million. Is that
    recoverable money or is that what you're out of pocket? Is
    there any way you can negotiate that?
        Mr. Williams. That has been the shortfall in our contract.
    For several years, we filed the claim for the amounts of the
    shortfall in 1991 and 1994. And despite the desperate
    telephonic calls and recordings--recording our annual funding
    agreement, I've never received any written decision from the
    Indian Health Service in over four years.
        The Chairman. Have there been lawsuits filed by the tribes
    over this problem?
        Mr. Williams. No, we've tried to resolve it without legal
    action, at this point.
        The Chairman. OK. No. 2 is you mentioned two things, one
    sugar and one, I believe, was tobacco. Sugar, you say, is
    subsidized at 2.--how many billion?
        Mr. Williams. The GAO report, if you can believe everything
    you read, in the Wall Street Journal yesterday, state that last
    year
    $2.2 billion, the total Indian Health Service budget; and this
    year, so far, $1.6 billion, with a request from the--it's crazy
    that OMB would oppose any health service contract support. But,
    then, the Administration asked for another $350 million to
    subsidize a product, with all due respect to the great farmers,
    for 544 tribes and two and a half million Indians, and they can
    fund a subsidy such as this. It's killing our people, and still
    cheat and rob and treat the first Americans the way they do for
    the third of the money that's required for health care.
        The Chairman. I think that's a good point. I love sugar
    myself, but it is probably the biggest villain we have, I know,
    in Alaskan villages, between soda water and coke and--that's
    the drinking kind--and I guess candy, two of the--biggest,
    harmfulness consumption thing that they take now. It's close to
    alcohol or worse.
        Mr. Williams. Mr. Chairman, it glared at me, because I know
    if you stop the flights of the soft drinks, which the sugar is
    in, to our villages, you'd have community in relapse. They've
    been without good water for 30 and 40 years and they've
    substituted--the young generation has substituted good drinking
    water, which Americans take for granted, with soft drinks.
    That's a fact.
        The Chairman. I appreciate it. Mr. Gilchrest, would you
    take over for me, please?
        [Pause.]
        Mr. Gilchrest [presiding]. The chair now recognizes Mr.
    Smith.

                        STATEMENT OF CHAD SMITH

        Mr. Smith. Good morning, Mr. Chairman. My name is Chad
    Smith. I am Principal Chief of the Cherokee Nation. I'm honored
    to have this opportunity to present the Cherokee Nation's view
    on contract support costs today.
        The Cherokee Nation is comprised of over 230,000 tribal
    members, nearly half of which live within our 7,000 mile
    jurisdictional area in northeastern Oklahoma. We are one of the
    second largest tribes in the country and we have 22 treaties
    with the Federal Government and Great Britain. Twenty-five
    years ago, we began the gradual process of contracting local
    programs to the BIA and IHS, in order to streamline, redesign,
    and enhance Federal services for people. And from our
    perspective, I can best convey the message by a story.
        Ruth Smith, Rufus Smith's wife, was a great basket maker in
    our rural community of Marble City, a vibrant, beautiful woman.
    She contracted diabetes. As all of us know, the Indians have
    the highest rate of incident of diabetes in this country. She
    came to town one day. The diagnosis was made. The next time she
    came to town, she had toes and one foot removed. The next time,
    she had toes and another foot removed. And every time she came
    to town thereafter, to Tahlequah, another index was removed,
    another part of a limb, her ankles, her calves, and then her
    whole legs. And the last time I saw her with her children, on a
    hot July day, they were taking her in and out of a backseat of
    a car, without legs. The next time for Ruth Smith, after
    dialysis, she passed away.
        In response, the Cherokee Nation developed some very
    aggressive diabetes programs through health care funding. We
    developed, in cooperation with the local rural hospital, a
    podiatry and orthopedic clinic. Last year, during my term, we
    had to reduce our health budget by $1.5 million. We had to cut
    the podiatry clinic. And now I face the recurring cries of our
    people, who come to me and say, we need the podiatry clinic. We
    need that orthopedic clinic. We're going back to the scenario,
    we'll see more Mrs. Smiths come to town less and less each time
    by incidents of diabetes.
        To complicate matters, we have two Indian hospitals within
    our territory. We operate six clinics. Each of those hospitals
    have recorded a million dollar deficit this year. Our
    population goes from clinic to clinic, from hospital to
    hospital. When they reduce their services, they come to our
    clinic. In fact, Indian hospitals reduced their pharmaceuticals
    by--they no longer issue the asthmatic inhalers. It cost them a
    dollar and a half each. That creates that market to come to our
    clinics and we have to deal with it.
        We're suffering, because of lack of contract. We have to
    ask the question, why does a private contractor, such as
    General Electric and Boeing, get their administrative and
    general costs paid, full indirect costs, full direct costs,
    such as unemployment and Worker's Comp, and we don't. We can
    assure the Committee and Congress that we don't pile on the
    costs when we run these programs. Each of these programs begin
    to suffer, because of the lack of funding. For example, the
    Bureau of Indian Affairs programs that we operate, we've taken
    a hit of $500,000 for each of the last 10 years, for
    accumulative amount of $5 million. In health service, we have
    been cut back $3.7 million, because of the lack of contract--
    contract costs.
        My written testimony addresses several others, with respect
    to this excellent bill, including the way it addresses the
    barriers in our government indirect cost agreement, the need
    for a new OMB circular, the need to eliminate the conflict of
    interest presently and how IHS handles contract support costs
    issues. There is so much more that the Cherokee Nation and the
    government can do and there's so much more that we must do, to
    meet the critical health, education, economic and social needs
    of our citizens and other eligible Indian people in our area.
    We are pleased to carry out the Federal Government's trust
    programs. Pleased, because history shows that we have the
    capacity and capability to do a much better job than the
    Federal bureaucracy. But, our ability to administer these
    programs successfully maximize the delivery of these needed
    services to Indian people depends on having adequate contract
    support costs funding. This bill will go a long way for
    resolving a very serious problem in the self-determination,
    self- governance programs.
        Thank you, Mr. Chairman, for the opportunity to testify in
    support of H.R. 4148.
        [The prepared statement of Chad Smith follows:]

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        Mr. Gilchrest. Thank you, Mr. Smith, for your testimony. We
    have a vote going on. I think instead of stopping the hearing
    to go vote, if it's all right with the members, if the
    gentleman from American Samoa can take the chair while we
    vote--we'll return after the vote.
        Mr. Faleomavaega. Mr. Chairman, I think they would rather
    talk to you, as the chairman, than to me. I would respectfully
    request that we'll wait until you return.
        Mr. Gilchrest. Then, we shall return. You all have a 15
    minute break then.
        [Recess.]
        Mr. Gilchrest. The Committee will come to order. We
    appreciate your indulgence on our fascinating schedule here in
    the Nation's capital. And before we get started, I ask
    unanimous consent that Congresswoman Woolsey, if she wants to,
    to be allowed to sit on the dais and participate with the
    Committee during this hearing. You want to come up, Lynn, or
    you want to stay there?
        Ms. Woolsey. I'll stay here until I offer my testimony, if
    that's OK.
        Mr. Gilchrest. All right, that's fine. Our next witness is
    Lt. Governor Richard Narcia.

                      STATEMENT OF RICHARD NARCIA

        Mr. Narcia. Good afternoon. My name is Richard Narcia. I'm
    Lt. Governor for the Gila River Indian Community. With me today
    is Franklin Jackson. Mr. Jackson is President of our Health
    Care Corporation. He's seated to my left. And, also, Ms.
    Lindsey Naas, who is, also, the counsel for our corporation.
    Our community is located in south central Arizona. We are
    located in the heart of Congressman J.D. Hayworth's district.
    We are pleased and honored to have him sitting with you on the
    dais today. He has been a dedicated and long-standing friend of
    our community and deeply committed to the interests of the
    Native Americans, not only in Arizona, but in the--throughout
    the nation.
        The community provides health care, law enforcement,
    irrigation system construction, and rehabilitation and other
    community services under self-determination contracts and self-
    governance agreements with the Indian Health Service, Bureau of
    Indian Affairs, and Bureau of Reclamation. The issue of
    contract support funding is an issue of ongoing concern and
    importance to the success of our Federal programs. We are
    pleased to testify in support of H.R. 4148, which would make
    technical amendments to the contract support provisions in the
    Indian Self-Determination Act. Our Health Care Corporation's
    experience with contract support funding from the Indian Health
    Service demonstrates the failings of the existing contract
    support system.
        The community initially contracted with the IHS, to operate
    the hospital at Gila River in October 1995. For Fiscal Year
    1996, 1997, 1998, the Health Care Corporation's contract
    support requests worked its way up the IHS waiting list or cue.
    In late 1998, we were expecting 100 percent funding for the
    Fiscal Year 1999 contract year; however, the IHS policy
    changed. While we generally supported the new policy, the
    Fiscal Year 1999 policy change resulted in a loss of
    approximately two million dollars in contract support funding
    for our Health Care Corporation.
        Of particular concern during this past year was the IHS
    policy decision not to reimburse our Health Care Corporation
    prior year pre-award and startup contract costs. This decision
    resulted in the community receiving 61 percent of IHS approved
    Fiscal Year 1999 requests, while most tribes were funded at 80
    percent. This decision, also, resulted in our community and
    other similarly situated tribes being denied reimbursement of
    these one-time costs, while tribes before and after 1999 will
    receive reimbursement of these types of costs.
        With this background, I would like to briefly address
    several key issues addressed in H.R. 4148. As the Committee is
    aware, there is a 25-year history of inadequate funding of
    tribal government contract support costs. The community
    operates 14 BIA programs, two programs, public health and
    public works, with IHS, and recovers 85 to 90 percent of its
    indirect costs from the BIA and IHS. However, both BIA programs
    and the public health programs have accumulated over the years
    a significant amount of unrecovered indirect costs, which are
    absorbed by the community. H.R. 4148 would remedy this cycle.
        H.R. 4148 addresses several key issues that are necessary
    to ensure the sustainable success of any new contract support
    system, allowing for consolidation of adequately funded
    contract support costs, provides additional incentive for
    efficiently administering, and hopefully generating savings to
    reinvest in our health care and other programs. Providing for
    annual funding adjustments, based on medical inflation rates
    and the Consumer Price Index, recognizes the reality of keeping
    pace with the rising costs of providing health care and other
    services. The 2 to 3 percent inflationary increases we
    typically receive are not sufficient to keep us competitive
    with the Phoenix Valley health care market, which has
    experienced medical inflation rates of 8 to 9 percent.
        The last provision I want to comment on is section 3 of the
    bill. It is a provision that would require IHS to pay our
    Health Care Corporation and other pre-award and startup costs
    incurred in prior years. This provision would remedy the
    inequity I described earlier and treat our Health Care
    Corporation and other affected tribes on the same basis as all
    other newly contracting tribes have been treated before 1999.
        In closing, I want to thank Chairman Young and Congressman
    Hayworth for introducing this bill. I, also, thank the
    Committee for your commitment and persistence in pursuing a
    long-term workable solution to the contract support dilemma.
    The Gila River Indian community urges the Committee to report
    favorably on H.R. 4148. Thank you.
        [The prepared statement of Richard Narcia follows:]
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        Mr. Gilchrest. Thank you, Mr. Narcia. Mr. Allen?

                       STATEMENT OF W. RON ALLEN

        Mr. Allen. Thank you, Mr. Chairman. I am the Vice President
    of the National Congress of American Indians in Washington,
    DC., and Chairman of the Jamestown S'Klallam tribe, located in
    Washington State. I am here testifying on behalf and in support
    of this particular bill. I am very appreciative of the Chairman
    introducing this bill and Congressman Hayworth for sponsoring
    it. I, also, would encourage our Democratic friends and
    supporters in the Congress to endorse this bill. As Congressman
    Kildee had noted earlier in his opening remarks, when we find
    bipartisan or nonspartisan agendas, it's usually about Indian
    issues that involve the obligations of the Federal Government
    to Indian communities.
        The subject matter of this bill is something about which I
    have testified before this Committee and the Senate Committee
    on Indian Affairs many times over the last number of years. I
    have personally led the NCAI task force that has conducted an
    exhaustive study with regard to contract support and the
    responsibilities of the Federal Government to Indian tribes
    with regard to contract support. We have studied it in
    conjunction with the GAO and the IGO and the other Federal
    agencies, which have continued to analyze their
    responsibilities with regard to contract support, in complying
    with or carrying out the full intent of the Self-Determination
    Act.
        The Act has been very successful. It is transferring
    Federal resources to Indian people. It is empowering tribal
    governments to take over their responsibilities. And
    reciprocally, it is supposed to reduce the Federal bureaucracy,
    so that those resources and responsibilities are transferred
    out to Indian communities.
        But, this particular Contract Support Cost problem has
    become a serious impediment and it is frustrating. I
    appreciated Orie Williams' comments earlier in his testimony
    about the priorities of the Congress with regard to the
    funding. You have a lot of money and a lot of issues you have
    to deal with every year. But with regard to Indian issues, we
    have consistently shown that the underfunding of Indian
    programs continues to be a blemish against the Federal
    Government with regard to how it is addressing the problems and
    needs of Indian communities, and contract support is one of the
    fundamental responsibilities. It is an administrative
    responsibility of carrying out these Federal functions and it
    is a legitimate function and legitimate responsibility.
        This bill proposes to resolve a lot of legal ambiguities.
    It proposes to provide solutions that we believe are
    reasonable. It addresses a consistency of how to approach it.
    It suggests approaches on how to provide stability and
    efficiencies, and there are a number of other things that we
    believe it does to resolve some of the problems and conflicts
    that we, the tribes, have had with the Administration.
        It is quite frustrating that we can't get the Congress or
    the Administration to raise this issue as a priority and to
    fully fund it, both in IHS and BIA. It is also equally
    frustrating that we cannot get the other Federal agencies to
    take responsibility for this need within their contracts. But
    this bill puts the pressure on resolving this issue in a
    logical way.
        As you look for your offsets if you pass this bill, we
    would be concerned that the offsets would count against the
    allocation to the subcommittees, with regard to this
    jurisdiction. In other words, are you taking money out of one
    pocket and putting it into the other pocket of Indian country?
    That doesn't solve the problem. You know, that is an issue that
    we have constantly been challenging the Administration and the
    Congress with regard to. We raise it with regard to potential
    impact with regard to this proposal.
        We believe that this bill moves us off of this contract
    support cost issue, which we believe is an administrative
    matter, and moves us on to the serious problems of solving the
    needs of our communities, to improve health and to improve job
    opportunities and to deal with the elders and children programs
    and educational programs and so forth, so that we can focus in
    on those issues. You will never fund our total needs, but what
    we do want you to do is fund fully the programs that you have
    authorized in a way that does not become a detriment to the
    tribes or enforce us to divert our moneys to cover these
    expenses, because these expenses are real costs to the tribal
    government, and we have to cover them some way. So, usually, we
    will have to divert moneys from other projects, economic
    projects and so forth, in order to cover these administrative
    responsibilities.
        So, we have worked very hard over the last number years, we
    will continue to work with you and the Congress to persuade you
    on how to resolve this issue. We believe this bill goes a long
    way in that direction to resolve this matter. And we believe
    that we can address many of the issues that concern us about
    the bill. They are in our written testimony and we encourage
    you to take a look at some of the suggestions. But, we believe
    that the bill goes a long ways to solving this problem.
        We appreciate the opportunity to testify and we appreciate
    the opportunity to continue to work with you on this subject
    matter, and we do appreciate your championing our cause. Thank
    you, Mr. Chairman.
        [The prepared statement of W. Ron Allen follows:]

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        Mr. Gilchrest. Thank you, Mr. Allen. I yield first to Mr.
    Hayworth.
        Mr. Hayworth. Thank you, Mr. Chairman, and I think we
    should note for the record that four members of leadership of
    the Native American Caucus are here on the dais today and we
    want to thank our friends from Indian country and beyond, who,
    again, offer compelling testimony from the front lines,
    personal experience, the real frustrations with the inability
    to reconcile this problem. And, again, I thank my friend from
    Michigan and I thank all of those, who have testified this
    morning, as to our needs to make this a priority and solve this
    problem. Especially, I am pleased to see Lt. Governor Narcia
    and others from the Gila River Indian community here with us
    today.
        Lt. Governor Narcia, I am familiar with your community's
    dilemma concerning prior years pre-award and startup costs. Do
    you believe that H.R. 4148 will remedy this problem once and
    for all?
        Mr. Narcia. Congressman Hayworth, it's a pleasure to see
    you again. We thank you for your advocacy and support for the
    community on this issue in the past. With your indulgence, Mr.
    Chairman, I would like to refer this question to our Health
    Care Corporation President, Mr. Franklin Jackson.
        Mr. Jackson. We believe that H.R. 4148 addresses the legal
    concerns with reimbursing the community with startup costs.
        This provision in the bill will require the Indian Health
    Service to pay the community and other similarly situated
    tribes prior years award and startup costs on the same basis as
    Indian Health Service has reimbursed these costs with tribes
    prior to and after Fiscal Year 1999.
        And it is my understanding that under the Indian Health
    Service's new contract support policy, tribes will not have to
    wait for four or five years, as we did for reimbursement of
    these costs which are necessary to efficiently and responsibly
    manage local programs.
        This will eliminate for other tribes, what has been a
    financial burden for our health care corporation.
        Mr. Hayworth. Thank you, sir. I think it's safe to say
    that's been a severe burden for you and your health care
    corporation.
        Mr. Jackson. It has been.
        Mr. Hayworth. I thank you for that testimony, Mr. Jackson.
    Again, Lt. Governor, thank you.
        Whether it's Arizona, Alaska, Oklahoma Cherokee, or Native
    Americans throughout the nation, again, I thank those who come
    to testify with their compelling stories, and it is our mission
    to make sure that the rest of our friends in the U.S. Congress
    understand how important it is to move forward on that.
        With that, Mr. Chairman, I thank you for the time.
        Mr. Gilchrest. Thank you, Mr. Hayworth. Mr. Kildee?
        Mr. Kildee. Thank you, Mr. Chairman. First of all, Lt.
    Governor Narcia, please give my best to Governor Don Antone,
    and former Governor, Mary Thomas.
        Principal Chief, Chad Smith, I have one of your citizens of
    your sovereign nation working for me, Kim Teehee here. She does
    a great job. She is a wonderful person.
        And Ron Allen, Ron, you've been a mentor of mine for so
    many years, I'm just always grateful to you and glad that
    you're here.
        And I don't want to neglect you, Mr. Williams. I don't know
    if we've chatted before, but I feel very close to this issue
    and very close to you at the table there.
        Ron and I had the occasion of spending some time with the
    President of the United States last summer, flying around the
    country and out to Pine Ridge, and looked at the housing out
    there. I appreciated that very much.
        I think this is a great bill. It's really a--you know, I
    think we do our best work in this Congress when we do it in a
    bipartisan way.
        In the last few years, we really have been approaching
    Indian legislation in a bipartisan way, and I think that this
    is--this would really make a real difference in Indian country
    for health care. It's very important.
        You know, if Government's role is to promote human dignity,
    health care is an essential part of that, and we have a real,
    as I say, moral obligation.
        I look forward to working with--as we say, we have three of
    the officers of the Native American Caucus right up here, so
    you have a very sympathetic audience. But I think we are
    effective enough to influence the others, and I just really
    have no questions.
        I think you've presented compelling reasons why we should
    proceed this way, and I thank you very much for it.
        Mr. Gilchrest. Thank you, Mr. Kildee. I have just a couple
    of questions. I think Mr. Smith or maybe Mr. Williams mentioned
    that Native Americans have the highest rate of diabetes of any
    ethnic group in the country.
        Can someone tell me why that is? Why do Native Americans
    have a higher rate of diabetes than any other group in the
    country?
        Mr. Allen. Well, Mr. Chairman, let me just in a very
    pragmatic way explain. You know, Dr. Trujillo is probably one
    of the best ones to answer that, because they have spent so
    much time studying the genetic conditions of Indian people and
    why the Indian people have such a high propensity for diabetes.
        We know that it is true that we have a higher level of
    diabetes than any other ethnic group in the United States, and
    it is prevalent throughout the United States. It is as
    prevalent in Alaska as it is throughout the other parts of
    Indian country.
        And it's a problem we've been wrestling for many, many
    years. We have not had any overwhelming success in beating it,
    but we are moving aggressively forward in educating our
    communities about the fact that genetically, our people, you
    know, have a higher propensity for diabetes and because of
    that, they have a better understanding of how to counter it
    throughout their lives.
        So it is a problem we are constantly wrestling with. And
    how well we're wrestling with it, Dr. Trujillo and his staff
    will probably know how well we're being successful in beating
    it back within our communities.
        Mr. Gilchrest. Thank you, Mr. Allen.
        Mr. Williams. Mr. Chairman, if I could help, from my
    perspective, it's not a medical perspective. The increase in
    diabetes in Alaskan villages is on the upward spiral.
        And I expect a tremendous cost for diabetes in the next ten
    to 20 years to increase dramatically. The change in traditional
    diet from traditional foods to sugar is one of the main reasons
    that I have observed, change in diet, change in lifestyle, but
    I think diet has to be the biggest one.
        As stated, why the article startled me in the paper, and
    the amount of money spent on sugar, is because for so many
    years, the lack of clean water to drink, and the average use in
    our villages which I represent of maybe 50 gallons of water per
    family per day, instead of the 250 gallons per day of the
    normal family----
        Obviously, the water is going for cooking and food and
    clothing and doing those necessary things, and it's not going
    for drinking.
        That's just one small answer to the question. I think the
    government commodities where my wife comes from in South
    Dakota--there is a history of government commodities and change
    in lifestyle and change in diet has had a tremendous impact.
        Mr. Gilchrest. Thank you, sir. Dr. Trujillo?
        Dr. Trujillo. Thank you, Mr. Chairman. Yes, we are seeing a
    great rise of the incidence and also the consequences secondary
    to diabetes across the Nation among American Indians and Alaska
    Natives.
        Unfortunately, we are now even diagnosing adult onset
    diabetes, which is called Type II Diabetes, in individuals of
    the ages of 14, 11 and 10. We also have individuals throughout
    the Nation who have the end stages of diabetes, and being on
    dialysis at age 14 and 15.
        Unfortunately, the problem is secondary to numerous
    factors: One is probably--some genetic propensity for
    development of the diabetes, but primarily it's secondary to a
    change in lifestyle, the change in diet, activity, and other
    associated factors. Smoking and cardiovascular diseases are
    also on the rise, as are other chronic diseases.
        There is no tribe throughout the United States and Alaska
    that is not untouched by diabetes at the present time. We have
    had some special funding from Congress, secondary to the
    knowledge that we need additional resources and services.
        These funds now are assisting tribes and the Indian Health
    Service at educating people throughout the Nation of what might
    be able to be done to avoid or help individuals who are now
    diagnosed with diabetes.
        The difficulty will be is that we are seeing a rise of the
    diagnosis of diabetes. In 5, 10, 15, 20 years, individuals who
    are now being diagnosed will have the consequences of this
    disease and end-stage problems difficulty in seeing, probably
    blindness, difficulty in end-stage renal disease, probably
    dialysis or consequently problems with cardiovascular and
    peripheral vascular disease with loss of limbs that the
    Chairman from Cherokee mentioned today.
        It is a scourge of American Indians and Alaska Natives
    presently and very similar to the TB that we saw earlier in
    this century.
        Mr. Gilchrest. Thank you, Doctor. Is this--would you say
    this, at least in part, is due to health care programs that
    have been grossly underfunded for much of this century, the
    lack of education and just the lack of attention paid to that
    particular issue?
        Dr. Trujillo. The areas of public health are essential in
    the prevention. The education, health education and the way
    that we might be able to prevent the disease is essential. For
    those who may have inherited propensity for the disease the
    difficulty is in getting associated care and obtaining adequate
    care, tertiary care, especially for individuals who have severe
    disease, throughout the nation.
        Mr. Gilchrest. Thank you, Doctor. I have some--I don't have
    any--basically, I guess, not for the last 250 years, Native
    Americans on the Eastern Shore of Maryland, which I represent,
    but on the Eastern Shore of Maryland, we have a much higher
    than average rate of diabetes. And it's just interesting that--
    which could be the quality of the water, diet, smoking, a whole
    range of things.
        But we will work as a group together with all of you to
    ensure that this eventually becomes a thing of the past.
        Dr. Trujillo. Yes. We are seeing a rise of diabetes in all
    populations throughout the nation, but unfortunately, American
    Indians and Alaska Natives lead in that unfortunate disease at
    the present time.
        Mr. Gilchrest. Thank you very much, Doctor. Yes, sir, Mr.
    Narcia.
        Mr. Narcia. Mr. Chairman, in talking about diabetes, the
    Gila River Community has the unhappy distinction of having the
    most--the highest rate of diabetes per capita of any group of
    people in the world.
        And at this time, we're looking to find solutions to this
    problem. We are in the process of establishing a diabetes
    center for our people with the help of Congressman Hayworth,
    and hopefully we can start resolving some of these issues.
        But at this point, our people are very frustrated with the
    care, the research that's been done. We're the most researched
    people in the world, the Pima people. And it's sad, because we
    see children as young as less than 10 years old, having
    diabetes.
        And our people are also frustrated with the research that's
    been done in the past where it targeted not the diabetes that's
    not--that applies to our people, but to the non-Indians, which
    studies that were done by the Indian Health Service or the
    Public Health, so, you know, I'm glad you're very aware of this
    deadly disease that's plaguing our people. Thank you.
        Mr. Gilchrest. Thank you, Mr. Narcia. Just a couple of
    quick questions. I know someone needs to catch a plane, so I'll
    try to expedite this.
        Mr. Allen in your testimony you state that the Federal
    Government finally settled $80 million worth of liabilities to
    tribes which only covered up to the year 1993. Has the Federal
    Government made any commitment to finalize a settlement to the
    present date?
        Mr. Allen. They are currently in the middle of negotiating
    a settlement. Part of that settlement is a way that they would
    calculate the indirect cost rate and the contract support
    responsibilities of Interior with regard to the tribes.
        And, of course, the settlement is dealing with the other
    Federal agencies who have underfunded this indirect cost rate.
    So, we're looking for a compromise solution, and my
    understanding is they're having good success in the
    negotiations, and they have had discussions, preliminary
    discussions with IHS to try to address their responsibility as
    well.
        And we hope that we'll get that thing resolved as far as
    the past settlement issues, and try to move this thing forward.
    But it doesn't solve this problem as well as this bill does,
    going into the future.
        Mr. Gilchrest. I see. So, would you say that this bill--my
    next question was going to be, what can Congress do to ensure
    this full settlement up to the year 1999? You feel this bill
    will do that?
        Mr. Allen. This bill would significantly contribute to
    closing the book on what the obligations are, including
    addressing the matter within the OMB circular in terms of
    having very specific guidelines as it addresses how you expend
    these resources from OMB's circular perspective.
        We believe that it would resolve it once and for all, and
    make it very unequivocally clear that this is how we're going
    to pay for this, these funds associated with these contracts.
        Mr. Gilchrest. Thank you. And, Mr. Smith, in your written
    testimony, you express support for transferring responsibility
    for contract support cost issues from the Division of Financial
    Management to the Office of Tribal Programs.
        What is your source of criticism of the Division of
    Financial Management?
        Mr. Smith. Last year, IHS had a circular which said that
    all contract support costs requirements should be determined by
    the local area office in negotiations with each tribe.
        Disagreements only were to be moved up the chain of command
    to the Division of Financial Management. We followed that
    procedure and negotiated a hard number at the Oklahoma Area
    Office.
        Despite complete agreement between us and the area Office,
    the Division of Financial Management personnel stepped in and
    unilaterally reduced our requirements by $2.7 million.
        The only reason that the Division of Financial Management
    did this is because the bulk of the $2.7 million was not in the
    Cherokee Nation's indirect cost pool, a way of saying that the
    DFM disagreed with the agreement that we had with the Office of
    Inspector General for how we account for our funds.
        By making this reduction, DFM would have us eliminate
    virtually the entire administrative structure for the Cherokee
    Nation Health Department.
        Mr. Gilchrest. And one more followup to that: Your
    testimony indicates that the Cherokee Nation has never received
    any so-called direct contract support costs funding from the
    Bureau of Indian Affairs.
        In fact, last year the Assistant Secretary acknowledged
    before this Committee that the BIA has never paid such costs.
    What has the impact been on the Cherokee Nation?
        Mr. Smith. The Cherokee Nation operates over $13 million
    worth of BIA programs, employing 158 individuals who would
    otherwise be employed by the Bureau. When the Bureau employed
    these people, it covered their Workers Compensation and
    Unemployment Insurance benefits.
        When the positions were transferred to us, those benefits
    were held back. Using IHS's historic estimate that these costs
    ran about 15 percent of salaries, the Bureau has shorted the
    Cherokee Nation by over half a million per year for a total of
    $5 million to date.
        Let me clear with the Committee: To cover the Workers
    Compensation shortfall, we have had to reduce our BIA programs
    by the same amount, a half a million dollars a year.
        This Catch 22 will be remedied by H.R. 4148.
        Mr. Gilchrest. Thank you, Mr. Smith. Gentlemen, thank you
    very much for your testimony, and we look forward to working
    with you on this bill to see it passed as soon as possible.
    Thank you very much.
        Now, there's a little--as far as I can see, slight
    alteration in the next panel. Ms. Woolsey, the Congresswoman
    from the great State of California, and Mr. Greg Sarris,
    Chairman, Federated Indians of Graton Rancheria Novato,
    California. Ms. Woolsey and Mr. Sarris, welcome.
        Ms. Woolsey, you may begin.

    STATEMENT OF THE HONORABLE LYNN C. WOOLSEY, A REPRESENTATIVE IN
      CONGRESS FROM THE 6TH DISTRICT OF CALIFORNIA; AND MR. GREG
       SARRIS, CHAIRMAN, FEDERATED INDIANS OF GRATON RANCHERIA,
                           NOVATO, CALIFORNIA

               STATEMENT OF THE HONORABLE LYNN C. WOOLSEY

        Ms. Woolsey. Thank you, Mr. Chairman, and thank you. I'd
    like for the record to show that two of the four leaders of the
    Native American Caucus are still with us today, so thank you
    for your interest in our Native Americans and for sticking in
    here with this.
        I'm pleased to be here today to testify in support of H.R.
    946, the Graton Rancheria Restoration Act. It's also a great
    privilege to sit here with Dr. Greg Sarris, who is the Chair of
    the Federated Indians of Graton Rancheria. He was supposed to
    be on Panel II. Thank you for putting him next to me so he can
    catch a plane. He's barely going to make it.
        Together, we've worked for several years on this bill. And
    on behalf of Greg and on behalf of the tribe, I appreciate your
    hearing us today, and allowing us to speak.
        The bill before you today, H.R. 946, seeks to correct a
    decades-old wrong by restoring Federal recognition for the
    Federated Indians of Graton Rancheria.
        Composed primarily of the California Coast Miwok and
    Southern Pomo tribes in my Congressional District, which you
    know, Mr. Chairman, is north of San Francisco, across the
    Golden Gate Bridge.
        Joe Saulque, who chaired the Advisory Council on California
    Indians, stated that lack--no, not lack--luck often determined
    whether a tribe got recognized.
        And I am so glad that with today's hearing, we are going to
    take luck out of the equation by taking the first step in
    restoring the tribe's status, because it is the right thing to
    do. It should not be based on luck.
        The tribes of the Graton Rancheria are a rich part of the
    San Francisco Bay Area's cultural heritage. The earliest
    historical account of the Coast Miwok peoples whose traditional
    homelands include the California communities of Bodega,
    Tomales, Marshall, and Sebastopol, located along the West Coast
    of my District, dates back to 1579.
        Today there are approximately 380 members of the Federated
    Indians of Graton Rancheria.
        In 1966, the U.S. Government terminated the tribe's status
    under the California Rancheria Act of 1958. Almost two decades
    later, the Advisory Council on California Indian Policy was
    established by the Congress to study and report on the special
    circumstances facing California's tribes, those whose status
    had been terminated.
        The Council's final report, which was submitted to Congress
    in September 1997, specifically recommended the immediate
    restoration of the Federated Indians of Graton Rancheria.
        Following this report's recommendations, the tribes
    promptly decided on a course of action for the restoration.
    Since then, I've been working with them on the bill.
        And it's the bill that's before you today. This consensus
    bill restores Federal rights and privileges to the tribe and to
    its members.
        As is typical with restoration legislation, it reinstates
    political status and makes tribal members eligible for benefits
    such as Native American health, education, and housing
    services.
        These are services, as you know, that are available to all
    other Federally-recognized tribes. A unique aspect of H.R. 946,
    however, is that it specifically contains a clause that
    restricts gaming, gaming on land that is taken into trust for
    the tribes.
        This non-gaming clause is at the express request of the
    tribe, and is the basis for the broad and bipartisan support
    that this bill enjoys throughout my Congressional District.
        It is also key to my support for the tribe's restoration.
    As most of you know, I'm privileged to represent an area with
    unparalleled natural beauty. Open space, controlled growth, and
    quality of life are defining characteristics and values for the
    residents of Marin and Sanoma Counties.
        Greg Sarris, and the tribes recognize and appreciate this
    because they live there also. They are also acutely aware of
    the growing pressure on restored Indian tribes to establish
    gaming as a means of economic independence.
        Their sovereign decision--and I repeat, sovereign
    decision--to choose other means of economic vitality is out of
    respect for preserving the current character of the North Bay,
    and a commitment to our community that their quest for
    restoration is not to establish gaming.
        And, most importantly, it is a request for their right to
    self-determination. As the Federal representative for the area
    where their tribal land will be established, I'm very proud
    that this bill addresses their wants and needs as well as the
    rest of the residents of the vicinity.
        Interesting enough, my office recently received a visit
    from the San Manuel Band of Mission Indians that are located
    near San Bernardino, California.
        They operate gaming on their lands, but they were proud to
    learn that the Federated Indians of Graton Rancheria were
    asserting their right to make a sovereign decision about their
    tribe's future.
        Mr. Chairman, I'd like to enter into the record, a
    statement of support for H.R. 946 from this particular tribe.
        Mr. Gilchrest. Without objection, so ordered.
        Ms. Woolsey. Thank you. And, Mr. Chairman, it's been a long
    journey for the Federated Indians of Graton Rancheria, and on
    behalf of their hard work and the support they have received
    from the local community, I ask that this Committee hold the
    markup of H.R. 946 and bring this bill to the Floor for
    consideration so that we can restore the deserved recognition
    that they request.
        I thank the Committee again for the opportunity to testify
    in support of restoration for the Federated Indians of Graton
    Rancheria, and I look forward to a continuing working
    relationship with this Committee on their behalf. Thank you
    very much, Mr. Chairman.
        [The prepared statement of the Honorable Lynn C. Woolsey
    follows:]
    [GRAPHIC] [TIFF OMITTED] T8434.041

    [GRAPHIC] [TIFF OMITTED] T8434.042

    [GRAPHIC] [TIFF OMITTED] T8434.043

        Mr. Gilchrest. Thank you, Ms. Woolsey. We will do our best
    to expedite the bill.
        Mr. Sarris?

                        STATEMENT OF GREG SARRIS

        Mr. Sarris. First of all, thank you, Mr. Chairman, for
    rearranging the order of speakers here right now. It took a lot
    of fried bread sales from my people to get me here today, and
    I've got to catch a plane back.
        Let me give you a little bit of background, everybody here,
    about the tribe. The Federated Indians of the Graton Rancheria
    were called by the 1920's 1930's, Coast Miwok or Southern Pomo
    by linguists and anthropologists.
        At pre-contact time, we were approximately 5,000 people of
    many--several dozen bands of Indians who interacted as one
    group.
        Today we have 380 enrolled members. Of those members, 380
    members, we are all descendants of 12 survivors.
        We were first contacted by, of course, the Spanish, who put
    us in the missions. The northernmost missions were in our
    territory, and then the Mexicans who established an elaborate
    slave trade situation that enslaved virtually all our men and
    traded them as far as Mexico, back and forth on the ranchos.
        In 1850, when California became a State, one of the first
    pieces of legislation that was enacted by the State of
    California was the Act for the Government and Protection of
    Indians which, in essence, legalized Indian slavery.
        It stipulated that Indians became the rightful property of
    whomever's land they were on. We were bought and sold until
    that law was repealed in 1868, three years after the Civil War.
        For the next 50 years, we lived as indentured servants on
    whomever's ranch we were on.
        In the early part of the 20th Century, the BIA began
    purchasing small tracts of land for the so-called homeless
    Indians of California. They did not designate us by tribes, but
    by areas in which we resided on small rancherias or privately-
    owned property.
        We were still generally referred to by the derogatory term
    of digger Indians. In 1920, after looking up and down the coast
    at our territory, 15.45 acres were purchased in Graton for our
    members. Seventy-five members moved on in 1920.
        Unfortunately, of those 15.45 acres, only three were
    inhabitable; the rest were virtually up and down, so many of
    our members could not stay there.
        In 1958 when they came by and did a census at the height of
    the harvest season, when no one was around, they found three
    families and with the Rancheria Termination Act, offered those
    three families or three designees, the right to buy the land,
    and, in essence, terminate the rancheria as trust land and,
    therefore, terminate us as--our tribal status as a recognized
    tribe.
        That was not settled until 1966, at which point there was
    one family left, and that family got the land. We were then, as
    Lynn mentioned, Congresswoman Lynn Woolsey, terminated,
    effectively as a tribe, without the vote or the consensus of
    the rest of the members.
        Due to taxes and what have you, that family was able to
    hold on to only one acre of that land. A woman, the daughter of
    the designee, who still lives on the land, has given it to us
    as a token to restore to trust status, the tribal lands, and,
    in turn, restore us as a tribe.
        Congresswoman Lynn Woolsey mentioned the issue of gaming.
    We worked closely with both the Democrats and Republicans there
    who did not want development on the land.
        I, for one, and I think I can speak for many people of my
    tribe, feel strongly that Indian people should have the
    sovereign right to game. It isn't that issue; it's working
    together with our group, that we did not want to develop the
    land for casinos or any other purposes.
        What we are asking is for our rights to be returned; that
    is, our rights to health benefits, education benefits, and
    housing benefits that are afforded all other recognized
    American Indian tribes.
        And as I mentioned, we were terminated in 1966. As you
    know, since that time, American Indians have made some
    significant gains in terms of health and education. We would
    like access to some of that, and we would like once again to be
    restored as a people and have rights that we once had so that
    we might not be as we were before 1920, simply homeless Indians
    of California. Thank you.
        [The prepared statement of Mr. Sarris follows:]
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        [GRAPHIC] [TIFF OMITTED] T8434.045

        [GRAPHIC] [TIFF OMITTED] T8434.046

        [GRAPHIC] [TIFF OMITTED] T8434.047

        Mr. Gilchrest. Thank you, Mr. Sarris. How many--that's an
    interesting but sad story that's covered, I guess, several
    centuries, to descend to 12 survivors and now, I guess, ascend
    to 380, which is quite remarkable.
        How many acres does the bill set aside?
        Mr. Sarris. Approximately one acre, sir.
        Mr. Gilchrest. One acre?
        Mr. Sarris. Yes.
        Mr. Gilchrest. Now, where are the 380 enrolled members? Do
    they live in the area?
        Mr. Sarris. They live throughout Sonoma and Marin, southern
    Sonoma and Marin Counties, in and around Santa Rosa in private
    homes. We have no place to live. We've been gathering in front
    rooms and garages for our meetings.
        Mr. Gilchrest. You're asking for one acre?
        Mr. Sarris. One acre.
        Mr. Gilchrest. Even if you wanted a casino, it would be a
    pretty small casino.
        Mr. Sarris. Mr. Chairman, unless we could get an architect
    that could build an 87 story casino on one acre, it's unlikely.
        Mr. Gilchrest. So, one acre, which will be a site for,
    among other things, family reunions, I guess?
        Mr. Sarris. Family reunions and a place from which we can
    educate the larger community about who we are, and, again,
    house historical information and the things that we would like
    to keep as a tribe for our children and grandchildren.
        Mr. Gilchrest. Now, will the--so, there are 380 people that
    consider themselves southern Pomo or Indians of Graton?
        Mr. Sarris. Yes, Coastal Miwok.
        Mr. Gilchrest. So, do they all--they're in the area.
    They're all working. There is no--we're not talking about a
    Navaho Indian Reservation here, the Sioux Indian Reservation,
    or anything like that.
        So, the specific designation would do what for the people
    that are disbursed? They would receive the same benefits as the
    other Federally-recognized tribes?
        Mr. Sarris. Once again, we would have access to health
    benefits, many of which you heard about this morning earlier.
    We have no access to that, and yet we have the same problems in
    high incidence of diabetes and so forth.
        We cannot get the help from any other Indian agencies.
    Also, we would be able to apply for scholarships and
    fellowships as Indians, where at this point we cannot because
    we're not recognized as a Federal tribe.
        Mr. Gilchrest. Where would you have access to health care,
    a traditional doctor's office, a health care facility?
        Mr. Sarris. We have a health clinic, Sonoma Indian Health
    right in there that's enjoyed by other tribes.
        Mr. Sarris. I see. Mr. Kildee?
        Mr. Kildee. Thank you very much, Mr. Chairman. I think
    really the main benefit, aside from the fact that you are
    sovereign and you have a retained sovereignty, we're not giving
    it to you, we're recognized that retained sovereignty, and
    that's John Marshall's decision that you hold a retained
    sovereignty.
        We are not giving it to you by this bill; we're recognizing
    that retained sovereignty, and that's a very, very important
    distinction there, a very substantive distinction.
        The main gain that you would get by that recognition would
    be access to Indian Health Service and education. Were you in
    Michigan--when I was in the Michigan Legislature, I introduced
    a bill that any Michigan Indian can go to any Michigan public
    college without paying tuition. It's called the Indian Tuition
    Waiver Act.
        And that was--I know that's probably not the law in
    California, but there are certain rights that accrue to you
    when you are a recognized Federal tribe. Again, I want to
    emphasize recognition, not granting your sovereignty,
    recognizing your retained sovereignty.
        That's a--I carry with me wherever I go, I carry John
    Marshall's decision and I carry the Constitution. John
    Marshall's decision talks about the retained sovereignty, and
    this talks about your--the three types of sovereignty.
        I will just read this: Congress shall have the power to
    regulate commerce with foreign nations, and among the several
    states, and with Indian tribes, recognized as the three
    sovereignties.
        That's very important. Whether you have one acre or like
    the Navaho, you are--the fact that you have that sovereignty
    recognized, that you exercise your natural rights as a
    sovereign people, and that's very important. That's why this
    bill is very attractive to me.
        I will be candid, however. I have some concerns about
    limiting the sovereignty in the area of the Indian Gaming
    Regulatory Act. Mr. Sarris, have you--have other Indian tribes
    in California expressed any concern about the fact that you're
    willing yourself to not exercise that right under IGRA?
        Mr. Sarris. There has been some concern, yes, from some
    tribes mentioned, but the majority of the tribes nonetheless
    support our move. In fact, we have letters of support from the
    neighboring Pomo Tribes.
        Another thing I should mention is that as a result of
    Proposition 1 A in California, one of the provisions or
    stipulations is that tribes cannot establish gaming on newly
    acquired trust land. So if we were to establish or find a
    larger tract of land where we could have gaming, we couldn't
    have it.
        But more importantly for us, also part of the provision of
    Proposition 1 A is that non-gaming tribes can share, have
    profit sharing in the profits from the gaming tribes. But
    unless you're recognized, you cannot have access or we will not
    have access to the profit sharing with the gaming tribes.
        Mr. Kildee. Let me ask you this, because I really am
    anxious to recognize your sovereignty.
        If this legislation was silent about IGRA, would the
    California law still forbid you then to have gaming on that one
    acre of land or is that something lawyers have to sort out
    later?
        Mr. Sarris. Well, technically no. I mean technically we
    could have gaming on the one acre but in fact we have made an
    agreement with the woman living on there that we would not do
    that on her one acre that she has retained. She has expressed
    that she did not want that in any way and only wanted her
    home--you know, there is a little home, her little home that
    she has retained there--used for historic and cultural
    purposes.
        Mr. Kildee. But that land would become your land and it
    would be sovereign land?
        Mr. Sarris. The one acre, yes, sir.
        Mr. Kildee. One acre would be sovereign land. I am just
    asking these questions because I am really anxious to recognize
    your sovereignty. You know, we have had tribes in Michigan. I
    helped get the recognition of five different tribes. We have 12
    tribes in Michigan, pretty small tribes.
        One was--two, three were down to zero acres of land and I
    helped get them land also, maybe only about 300 acres but--
    which by Western standards but obviously not California
    standards was a fairly good chunk of land, so there are other
    instances where land has been--Burt, the land in Michigan was
    illegally taken from the Indians. Burt Lake, 1901, the Governor
    put them back on the tax rolls for that band and after one year
    when they did not pay their tax, did not tell them they were
    back on the tax rolls, they were illegally put back on,
    confiscated their land because the lumber barons wanted it.
        They came in--this was 1901, this is not, you know--my dad
    was 18 years old. He remembers when it happened. They came in
    and the Sheriff burned down, chased the Indians off the land,
    burned down their village so they could not return. Some
    terrible things have happened to Indians and I think that we in
    the Congress have not just a legal but a moral obligation to
    right these wrongs as much as we can.
        I certainly appreciate both of you testifying here today.
    Thank you, Mr. Chairman.
        Mr. Gilchrest. Thank you, Mr. Kildee. Mr. Sarris,
    Congresswoman Woolsey, thank you very much for your testimony
    and we will do what we can to--I guess you are not going to use
    that for grazing too many horses or cattle, but maybe you can
    expand it later on. Thank you for your testimony.
        Ms. Woolsey. Thank you, Mr. Chairman. Mr. Chairman, when
    you just said expand it later on, that is exactly why we want
    that language to stay in the bill for recognizing the
    sovereignty and what the tribe wants, and that is no gaming, no
    matter if they expand it or not, and that is important to the
    community, it is important to me, and it is important to them,
    and I would hope we could have a markup and keep the language
    intact as the bill is drafted now.
        Mr. Gilchrest. We will work with you, Ms. Woolsey.
        Ms. Woolsey. Thank you very much.
        Mr. Gilchrest. Thank you very much.
        Mr. Sarris. Thank you.
        Mr. Gilchrest. Yes, sir.
        Our next panel will be the Honorable Kevin Gover, Assistant
    Secretary, Bureau of Indian Affairs, Washington, DC., Ms.
    Madonna Archambeau, Chairwoman, Yankton Sioux Tribe, Marty,
    South Dakota, Mr. Arthur ``Butch'' Denny, Chairman, Santee
    Sioux Tribe of Nebraska, Niobrara, Nebraska.
        Welcome. Mr. Gover, you have double duty today. You can
    testify on both bills at this time, sir.

     STATEMENT OF THE HONORABLE KEVIN GOVER, ASSISTANT SECRETARY,
        BUREAU OF INDIAN AFFAIRS, WASHINGTON, DC.; MS. MADONNA
       ARCHAMBEAU, CHAIRWOMAN, YANKTON SIOUX TRIBE, MARTY, SOUTH
    DAKOTA; AND MR. ARTHUR ``BUTCH'' DENNY, CHAIRMAN, SANTEE SIOUX
                 TRIBE OF NEBRASKA, NIOBRARA, NEBRASKA

                 STATEMENT OF THE HONORABLE KEVIN GOVER

        Mr. Gover. Thank you, Mr. Chairman, and I am under a very
    severe time constraint at this point. Let me be very brief.
        First, on the Santee bill, we have two concerns with the
    legislation.
        First, it is not yet clear to us just how the values for
    the compensation were established. We certainly support the
    idea of compensation. We think it is a continuation of the
    Congress's work over the last few years to compensate all the
    tribes that were affected by the Missouri Basin projects, and
    therefore we support the notion of compensation.
        No one has yet told us what the basis of these particular
    amounts is and why it is the United States who ought to provide
    those particular amounts.
        In addition, the bill would further a practice that we have
    objected to before by establishing a fund that is sort of off
    budget, and we would still prefer that these compensation acts
    be put on the budget and be dealt with in a more
    straightforward way than has been true in the past.
        Finally, we strongly recommend a prohibition on per capita
    payments from these funds. Our experience with per capita in
    Indian communities, has not been a favorable one. We think that
    the money is better spent in the hands of the tribal government
    on community-wide projects as opposed to one-time payments to
    individual Indians that we have every confidence will have
    little impact in the community and soon will leave the
    community.
        On the Graton Rancheria restoration, we do support the
    bill. I want to make that clear. We agree. This tribe was
    wronged when it was terminated. That wrong needs to be righted.
        Our only concern really is with the gaming provision, and
    it is not that we wish to force gaming onto a community that
    does not want it, including this tribe. If the tribe chooses
    not to game, more power to them. We have absolutely no
    objection. We support their right to make that decision.
        Our concern indeed is not even with this particular tribe.
    If they don't want gaming, that is fine with us. The problem is
    that what tends to happen in these matters, and frankly this
    bill is an extension of this phenomenon, is that if we put it
    in one restoration bill, it will be in every restoration bill,
    and we think that's wrong.
        The tribes that were terminated were grievously wronged by
    the United States. The terms for readmission to the family of
    Federally-recognized tribes should not be the waiver of their
    right to conduct these gaming activities, and we object to
    that.
        I think that there are other ways to accomplish the
    objective of preventing gaming, with the tribe's consent, on
    the particular parcel that we are talking about or even in a
    particular area, without establishing the precedent that I have
    every confidence will show up in every restoration bill.
        There are a couple dozen California tribes that are in the
    same boat. Each of them undoubtedly will be coming to the
    Administration and to the Congress asking for restoration. They
    should be granted restoration, but as I say, the price of
    admission should not be to give up so important a right on a
    blanket basis.
        That, Mr. Chairman, summarizes my testimony. We have
    examined the evidence surrounding the Graton tribe. We are
    confident that these are the successors to the historical
    Graton Rancheria, and we very much support their restoration to
    Federal recognition.
        Thank you, Mr. Chairman.
        [The prepared statement of Mr. Gover follows:]
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        Mr. Gilchrest. Thank you, Mr. Gover. Ms. Archambeau.

                  STATEMENT OF MS. MADONNA ARCHAMBEAU

        Ms. Archambeau. Thank you, Mr. Chairman and members of the
    Committee for this opportunity----
        Mr. Gilchrest. I'm sorry, Ms. Archambeau. Just 1 second.
    Mr. Gover, if you need to leave, we will understand.
        Mr. Gover. I thank you, Mr. Chairman. I really do need to
    leave. It's a doctor's appointment with my daughter otherwise.
    I would be happy to stay.
        Mr. Gilchrest. Yes, sir. We will make sure that the
    testimony of Ms. Archambeau gets to you so she may have
    answered some of your questions.
        Mr. Gover. Thank you.
        Mr. Gilchrest. Thank you very much. Ms. Archambeau.
        Ms. Archambeau.--opportunity to speak on behalf of my
    tribe.
        Mr. Chairman, my name is Madonna Archambeau and I serve as
    elected Tribal Chairwoman for the Yankton Sioux Tribe. Our land
    is located in the southeastern corner of South Dakota.
        Accompanying me this afternoon is Deborah DuBray, our
    consultant attorney, who has worked with our tribe on this
    legislation.
        In addition, I have asked Dr. Michael Lawson to accompany
    me as well. Dr. Lawson is a respected historian who has
    developed an expertise on the Pick Sloan program and its impact
    on Indian tribes. Dr. Lawson has done extensive work on the
    tribe's claim which serves as a basis for H.R. 2671.
        They are here to assist me with questions from the
    Committee.
        First, let me express my sincere appreciation for the
    Committee's consideration of H.R. 2671. We have been working
    several years now to relieve some of the harm that our tribe
    has suffered as a result of the construction of the Fort
    Randall Dam on the Missouri River.
        I am honored to be here today to speak in support of this
    legislation. Now I would like to make a few points regarding
    H.R. 2671.
        The construction of the Fort Randall Dam and Reservoir on
    the Missouri River destroyed an important part of my tribe's
    traditional way of life. The Missouri River bottom lands were
    rich with game and plants and used for traditional foods. We
    used the plants for ceremonies and medicines, the trees and the
    bottom lands we used for lumber and fuel.
        We lost tribal land when the bottom lands were flooded but
    much of our traditional way of life was taken from us too.
        Our tribe lost acres and acres of rich productive
    agricultural land. We lost 3,260 in total acres due to the
    construction of the Fort Randall Dam and Reservoir, and we lost
    the entire community of White Swan.
        It was the practice of the United States to move the Indian
    communities flooded by the dam construction to higher ground to
    be re established, but our tribal community of White Swan was
    not relocated. It was simply destroyed, the families dispersed
    elsewhere. The community was never replaced. This was and still
    is a great loss to our people.
        My tribe and the Santee tribe did not have the same
    opportunity to negotiate and obtain settlements by acts of
    Congress as other Missouri River tribes did. Our land was taken
    by condemnation proceedings in District Court. As a result, my
    tribe and the Santee suffered great inequities in the initial
    settlements or taken land.
        Congress enacted equitable compensation legislation for
    four other upstream Missouri River tribes whose losses were
    similar to ours. H.R. 2671 is similar legislation. H.R. 2671
    will provide the tribe an annual interest payment from a trust
    fund established to compensate the tribe for losses and bring
    some equity to the issue of the Pick Sloan taking.
        The income will assist the tribe with its economic
    development and needs and help strengthen culture and social
    programs. This is a turn that will help the tribe move forward
    toward a great self determination in tribal affairs.
        I would like to present the Committee, the members, a copy
    of the letter written by South Dakota Bill Janklow in
    supporting this legislation. The Governor and the tribe did not
    always agree on tribal matters but we are in agreement of this
    bill. Our tribal members support this bill. It will help heal
    some of the wounds our tribal elders have suffered.
        The bill directs our tribal council to develop a plan in
    the interests of payments to be used. Our tribal plan will
    include programs and benefit all the tribal members, our
    elders, and our young.
        Mr. Chairman and Committee members, this bill, H.R. 2671,
    is very important to the future of the Yankton Sioux tribe. For
    these reasons, I ask the Committee to support us in our efforts
    to obtain equitable compensation in the past inequities.
        In closing, I want to thank Congressman Bill Barrett and
    his staff for their work in support of our efforts and I thank
    the members of this Committee and I respectfully ask the
    members to support our bill and take positive action in
    recommending its passage to the full House of Representatives.
    Thank you.
        [The prepared statement of Ms. Archambeau follows:]

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        Mr. Gilchrest. Thank you, Ms. Archambeau.
        We do have a vote on, but we have time to hear Mr. Denny's
    testimony. You may begin, sir.

                STATEMENT OF MR. ARTHUR ``BUTCH'' DENNY

        Mr. Denny. OK, thank you. Mr. Chairman, I am Chairman Butch
    Denny of the Santee Sioux Tribe in Nebraska. I am pleased to
    appear before the Committee today to provide some views from
    the perspective of the Santee Sioux tribe in support of H.R.
    2671.
        I will summarize my remarks from my written statement.
        The Santee Sioux reservation is located in northeast
    Nebraska. The Missouri River borders our reservation's northern
    boundary. I have attached a map to my written statement for
    reference to the areas we are talking about. I need not repeat
    the testimony of Chairwoman Archambeau but to say that the
    Santee tribe suffered similar losses as a result of
    construction of the Gavins Point Dam.
        Our tribal land was taken in a similar and swift manner
    through condemnation proceedings in District Court, resulting
    in the same inequities to the Santee as was experienced by the
    Yankton Sioux tribe. In 1952, almost 3 months before the Fort
    Randall Dam was completed, the Army Corps of Engineers began
    the construction of the Gavins Point Dam, whose water flooded
    part of our reservation. The Santee, as other Missouri River
    tribes, lost a way of life that centered on the river bottom
    lands.
        Our bottom land environment was similar in many ways to the
    other community of White Swan that once existed on the Yankton
    Sioux reservation. This is why we have joined the Yankton Sioux
    tribe in seeking an equitable remedy for past unfairness in the
    initial taking of our tribal lands.
        We base the justification of our claim on the same history
    and treatment by the United States. The Santee tribal land base
    is small, our tribal membership is small, and our claim is
    small, but our tribal loss due to the construction of the
    Gavins Point Dam is great. The dams and reservoirs have
    provided many benefits to the non-Indian people in surrounding
    communities in the Missouri River Basin through flood control,
    irrigation, hydroelectric power, and recreation. It is the
    Indian tribes who paid most for these benefits with their
    lands, and the Indian tribes who have yet to reap the benefits
    of the dam projects.
        There are minimal jobs on our reservation. This bill will
    aid us in developing economic opportunities for our members.
    This bill will aid us in addressing our housing, education,
    culture and social welfare needs. Many of our tribal elders are
    passing on. Soon there will be no elders to remember the
    traditional life along the rivers long ago. Our tribal elders
    believe that a just and equitable settlement is possible. The
    Santee tribal members unanimously support this bill.
        One cannot measure the cost of the loss of tradition, the
    loss of a way of life along a free flowing river, so we must
    look at the cost of measurable things, the acres of land
    flooded, the cost of relocation and the like. The Santee lost a
    total of 1,007 acres to the Gavins Point Project. The Santee
    settlement claim is minimal in comparison to others that have
    been enacted before us. The Santee Trust Fund will be
    capitalized with $8 million and only the interest of the Trust
    Fund that would be paid to the Santee. The annual interest
    payments will greatly assist our tribe to develop programs
    through a plan developed by the tribal council.
        As Chairwoman Archambeau stated, we have been working
    several years on this bill. With the Committee's support, it is
    the hope of the Santee Sioux tribe that H.R. 2671 will be
    enacted this year.
        At this time Chairwoman Archambeau and I would like to
    offer an amendment that will clear up a few inaccuracies in the
    funding of the bill. I would like to conclude by saying that we
    are grateful to Congressman Barrett for his support and for his
    staff, who have worked tirelessly with our tribes on this and
    other matters.
        Thank you.
        [The prepared statement of Mr. Arthur ``Butch'' Denny
    follows:]

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        Mr. Gilchrest. Mr. Denny, I apologize for the time
    constraints. We will--we will probably be gone for quite some
    time on this vote and I didn't want to keep people waiting
    here.
        Your testimony is highly regarded. Our goal here is to
    ensure justice. If there was any way for us to create a time
    machine and go back to 1944, the dam would not have been
    created. You would have kept your land, so it is just and right
    for you to be compensated.
        Mr. Kildee.
        Mr. Kildee. Well, I basically concur in your statements
    too. I think we should remedy past injustices, and we are
    probably going over for several votes right now. we may have
    some questions in writing for our own background here, but I do
    very much appreciate your seeking justice.
        If we are going to be seekers after justice, we have to
    pursue our own justice.
        Mr. Denny. OK. One thing I would like to add is that we at
    no time ever felt is that we should give this money out as a
    per capita payment. It would be used for infrastructure.
        Mr. Gilchrest. Thank you, Mr. Kildee.
        Ms. Archambeau and Mr. Denny, thank you very much for your
    testimony and everybody else that accompanied you here today.
    We will work with you on this issue.
        Mr. Denny. Thank you.
        Mr. Gilchrest. Yes, sir. Thank you very much.
        I ask unanimous consent that the statement by Mr. Miller be
    submitted into the record.
        [The prepared statement of the Honorable George Miller, a
    Representative in Congress from the State of California
    follows:]

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        Mr. Gilchrest. I wish you all safe travel. The hearing is
    adjourned.
        [Whereupon, at 2:08 p.m., the hearing was adjourned.]
        [Additional material submitted for the record follows.]

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        [Prepared statement of William Janklow follows:]

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        [Prepared statement of Honorable Bill Barrett follows:]

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