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

 H.R. 946, H.R. 2671, AND H.R. 4148 (YOUNG, R-AK)--TO MAKE TECHNICAL 


                           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/
           Committee address: http://www.house.gov/resources


68-434                     WASHINGTON : 2001

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                         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
GEORGE P. RADANOVICH, California     CALVIN M. DOOLEY, California
WALTER B. JONES, Jr., North          CARLOS A. ROMERO-BARCELO, Puerto 
    Carolina                             Rico
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


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 


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


    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:]

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    The Chairman. I thank you, Mr. Secretary. Dr. 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 
    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:]

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    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 
    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 
    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.



    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 
    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 
$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?
    Mr. Gilchrest [presiding]. The chair now recognizes Mr. 

                    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.
    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.


    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 
    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 
    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. 
    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 
    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 
    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 
    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 
    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. 
    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 
    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 
    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 
    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.

                       NOVATO, CALIFORNIA


    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 
    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 



    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 
    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 
    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:]
    [GRAPHIC] [TIFF OMITTED] T8434.044
    [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 
    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 
    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 
    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 
    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.



    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 
    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 
    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 
    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.


    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 
    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 
    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 
    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.


    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. 
    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 
    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 





    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 
    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 



    Mr. Gilchrest. I wish you all safe travel. The hearing is 
    [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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