[Congressional Record Volume 142, Number 113 (Monday, July 29, 1996)]
[House]
[Pages H8603-H8604]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   REPEALING OF PROVISION OF UNITED STATES CODE RELATING TO FEDERAL 
             EMPLOYEES CONTRACTING OR TRADING WITH INDIANS

  Mr. MOORHEAD. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 3215) to amend title 18, United States Code, to repeal the 
provision relating to Federal employees contracting or trading with 
Indians.
  The Clerk read as follows:

                               H.R. 3215

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

     SECTION 1. FEDERAL EMPLOYEES CONTRACTING OR TRADING WITH 
                   INDIANS

       (a) Repeal.--Section 437 of title 18, United States Code, 
     is repealed.
       (b) Conforming Amendment.--The table of sections at the 
     beginning of chapter 23 of title 18, United States Code, is 
     amended by striking the item relating to section 437.
       (c) Effective Date.--The repeal made by subsection (a) 
     shall--
       (1) take effect on the date of enactment of this Act; and
       (2) apply with respect to any contract obtained, and any 
     purchase or sale occurring, on or after the date of enactment 
     of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
California [Mr. Moorhead] and the gentleman from Virginia [Mr. Scott] 
each will control 20 minutes.
  The Chair recognizes the gentleman from California [Mr. Moorhead].


                             general leave

  Mr. MOORHEAD. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks on H.R. 3215.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. MOORHEAD. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of H.R. 3215 which repeals a provision 
of the Criminal Code, 18 U.S.C. 437, that prohibits certain Federal 
employees from contracting or trading with American Indians. The 
gentleman from Arizona, Mr. J.D. Hayworth, introduced H.R. 3215 on 
March 29, 1996.
  Section 437 prohibits employees of the Bureau of Indian Affairs and 
the Indian Health Service from entering into contracts with American 
Indians for the purchase, transportation, or delivery of goods or 
supplies for any American Indian. It further prohibits these employees 
from engaging in any purchase or sale of services or property from or 
to any American Indian. Because these provisions prohibit any of these 
transactions in any case in which the Federal employee appears to 
benefit, they effectively bar any such transaction with a family member 
of the Federal employee. A violation of this section is punishable by a 
fine or imprisonment of up to 6 months.
  Section 437, first passed in the 1800's, was enacted to prevent 
Federal employees who are involved in administering programs to assist 
American Indians from taking advantage of those they are supposed to be 
helping. While it was well-intentioned when passed, today it is 
outdated and no longer necessary. In addition, the section has the 
perverse effect of making it harder for the Indian Health Service to 
recruit and retain good medical employees for remote reservations 
because those employees' spouses are prohibited from trading with the 
local Indians.
  In 1980, Congress amended this statute to allow the executive branch 
to provide, by regulation, for exceptions

[[Page H8604]]

to the general prohibition on trading. Because H.R. 3215 will repeal 
the authority under which these regulations were promulgated, they 
should be repealed if this bill is enacted. As a practical matter, 
these regulations providing for exceptions will no longer be necessary 
nor effective because the general prohibition will no longer exist. 
However, I want to make it clear that this repeal should not be 
construed to prejudice any person who has lawfully acted in reliance on 
those regulations. I also want to make it clear that even though we are 
repealing section 437, and thereby rendering the regulations providing 
for exceptions unnecessary, all other applicable general standards of 
ethical conduct for these Federal employees remain in effect.
  Similar legislation passed the other body on October 31, 1995, as 
part of a broader package of technical amendments to laws relating to 
Indians--S. 325. The package passed by unanimous consent. Last week, 
the Committee on Indian Affairs in the other body by voice vote ordered 
favorably reported S. 199, a separate bill that addresses only the 
repeal of section 437. The Department of the Interior, of which the 
Bureau of Indian Affairs is a part, testified in favor of the repeal of 
section 437 at hearings on S. 325. I am informed that the Department of 
Health and Human Services, which includes the Indian Health Service, is 
in favor of repeal of section 437. I am also informed that the Navajo 
Nation and the Hopi Tribe are in favor of this legislation. I do not 
have any reason to believe that any other American Indian groups oppose 
this bill. I urge all Members to support this worthy legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SCOTT. Mr. Speaker, I yield myself such time as I may consume, 
and I rise in support of the bill.
  Mr. Speaker, this bill enjoys bipartisan support. The current law 
prohibits employees from the Bureau of Indian Affairs and the Indian 
Health Service from entering into contracts with Indians or their 
families for the purchase, transportation or delivery of goods or 
services. It also prohibits these employees from engaging in any 
purchase or sale of services with the property of any Indian.
  When first passed in the 1980's, the legislation was designed to 
prevent Federal employees who were involved in administering programs 
to help Indians from taking advantage of the Indians they were supposed 
to be helping.
  While it was well-intentioned when passed, today the law appears to 
be outdated and has the negative effect of making it harder for Indian 
Health Services to recruit and retain good medical employees for remote 
reservations because those employees' spouses are prohibited from 
trading with local Indians.
  Mr. Speaker, passing this bill will not diminish in any way the 
ethnical standards because the people involved will still be covered by 
all of the ethics in Government regulations. The counterpart 
legislation passed the Senate by unanimous consent last year, and I 
urge Members to support the measure.
  Mr. HAYWORTH. Mr. Speaker, I would like to take this opportunity to 
thank the distinguished chairman and ranking member of the House 
Judiciary Committee for their assistance in moving H.R. 3215 through 
the legislative process.
  As my colleagues may know, the Trading with Indians Act was 
originally enacted in 1834, and at that time it served an important 
purpose: to ensure that Federal employees did not improperly influence 
native Americans. However, today this law is unnecessary and 
unproductive. It establishes a prohibition against commercial trading 
with native Americans by employees of the Indian Health Service [IHS] 
and Bureau of Indian Affairs [BIA]. In many cases, this prohibition 
also extends to transactions undertaken by the spouse of a Federal 
employee.
  The penalties for violations include a fine of not more than $5,000, 
or imprisonment for not more than 6 months, or both. The act further 
provides that any employee who is found to be in violation should be 
terminated from Federal employment.
  Enforcement of this outdated law has caused great difficulties for 
many native American families. It has also made it more difficult for 
IHS and BIA to retain quality Federal employees in certain facilities 
located on remote parts of reservations.
  Both Health and Human Services Secretary Donna Shalala and Interior 
Assistant Secretary Ada Deer have expressed support for repealing the 
Trading with Indians Act. The Senate has already approved legislation 
which includes language identical to H.R. 3215. Both the Navajo Nation 
and the Hopi Tribe support passage of the bill. In fact, I am not aware 
of any opposition to H.R. 3215.
  Repeal of the Trading with Indians Act is long overdue. Passage of 
H.R. 3215 would benefit numerous native American families, and I hope 
that my colleagues will join me in supporting this commonsense 
legislation.
  Mr. SCOTT. Mr. Speaker, I yield back the balance of my time.
  Mr. MOORHEAD. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from California [Mr. Moorhead] that the House suspend the 
rules and pass the bill, H.R. 3215.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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