[Senate Report 104-362]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 581
104th Congress                                                   Report
                                 SENATE

 2d Session                                                     104-362
_______________________________________________________________________


 
 PROVIDING FOR CERTAIN BENEFITS OF THE MISSOURI RIVER BASIN PICK-SLOAN 
     PROJECT FOR THE CROW CREEK SIOUX TRIBE, AND FOR OTHER PURPOSES

                                _______
                                

               September 9, 1996.--Ordered to be printed

_______________________________________________________________________


    Mr. McCain, from the Committee on Indian Affairs, submitted the 
                               following

                              R E P O R T

                         [To accompany S. 1264]

    The Committee on Indian Affairs, to which was referred the 
bill (S. 1264) to provide for certain benefits of the Missouri 
Basic Pick-Sloan project to the Crow Creek Sioux Tribe, and for 
other purposes, having considered the same, reports favorably 
thereon with an amendment in the nature of a substitute and 
recommends that the bill as amended do pass.

                                purpose

    The purpose of S. 1264 is to provide certain benefits to 
the Crow Creek Sioux Tribe which were authorized in Public Law 
87-735 to provide for the mitigation of the effects of the Fort 
Randall and Big Bend Dam projects on the tribe's reservation, 
but which the United States failed to provide in whole or in 
part.

                               background

    The Crow Creek Sioux Tribe resides on a 258,361 acre 
reservation in central South Dakota. The Missouri River 
overlies the reservation's western boundary, and its rich 
bottomlands for generations provided the tribe with food, 
water, wood for shelter and fuel, forage for cattle and 
wildlife, and plants used for medicinal purposes. Construction 
of Fort Randall and Big Bend Dams, authorized by the Flood 
Control Act of 1944, resulted in the inundation of over 15,000 
acres of these bottomland resources and the permanent loss of 
the subsistence economy based on those resources.
    Fort Randall Dam, which the Army Corps of Engineers began 
constructing in 1946, flooded 9,154 acres of bottomland, over 
one-third of which was forested. It flooded Fort Thompson, the 
reservation's largest community, forcing eighty-four families, 
constituting 34 percent of the tribal membership, to be 
relocated. It caused the Bureau of Indian Affairs (BIA) to 
relocate its agency headquarters from that site to Pierre, 
South Dakota, fifty miles from the reservation, and the Indian 
Health Service (IHS) to move its hospital at Fort Thompson 
twenty miles south to Chamberlain, South Dakota. These 
facilities were now located over ninety miles from remote parts 
of the reservation, creating great hardship on the Crow Creek 
Sioux, whose transportation facilities were severely limited.
    The Big Bend Dam, which the Corps of Engineers began 
constructing in 1960, resulted in the flooding of another 6,179 
acres and the relocation of twenty-seven additional families. 
These Damages affected 5 percent of the reservation's land base 
and 11 percent of its population. Approximately one-fourth of 
the tribe's remaining farms and ranches were also flooded. The 
government's handling of the Fort Randall relocations was 
apparently not well-thought out, because families on both the 
Crow Creek and the Lower Brule reservations were relocated on 
lands within the projected area of the Big Bend Dam, and as a 
result, these families were subsequently forced to undergo the 
trauma of yet another move.
    The Committee's hearing record includes a detailed history, 
developed by the Historical Research Associates, Inc., of the 
legal battles over the Corps of Engineers' efforts to take 
Indian lands for Missouri River Dam construction by eminent 
domain, and the efforts by the Crow Creek Sioux and other Sioux 
Tribes affected by the Dams first to stop construction, and, 
failing that, to obtain compensation for Damages and relocation 
costs. A synopsis of that history is set forth below.
    In 1962, in enacting the Big Bend Recovery Act (Public Law 
87-735), which provided for the purchase of land for Big Bend 
Dam (two years after construction began), the Congress 
acknowledged the adverse impacts of the Fort Randall and Big 
Bend projects on the Crow Creek people, and directed the Corps 
of Engineers to replace lost infrastructure, tribal and Federal 
government facilities, schools, hospitals, a community center, 
and road and utilities. However, as a result of subsequent 
funding decisions by the Corps of Engineers and the lack of 
coordination between the Corps and the BIA, these directives 
were either carried out inadequately, or not at all.

                    s. 1264 and substitute amendment

    The benefits that S. 1264 would provide the Crow Creek 
Sioux Tribe are similar to those provided for in the Three 
Affiliated Tribes and Standing Rock Sioux Tribe Equitable 
Compensation Act of 1992. That Act established trust funds for 
the tribes of the Fort Berthold and Standing Rock Reservations 
and funded them with receipts of deposits from the Missouri 
River Basin Pick-Sloan program to compensate the tribes for the 
inundation of their lands. The amount of compensation was based 
on the recommendations of an extensive study by a joint 
Federal-tribal advisory committee, known as the Garrision Unit 
Joint Tribal Advisory Committee, of the impacts of the 
government's taking of over 300,000 acres of tribal lands for 
Garrison Dam and Reservoir and Oahe Dam and Reservoir as part 
of the Missouri River Basin Pick-Sloan program.
    The substitute amendment to S. 1264 establishes a Crow 
Creek Sioux Tribe Infrastructure Development Trust Fund in the 
U.S. Treasury in which will be deposited, on an annual basis 
beginning in fiscal year 1997, an amount equal to 25 percent of 
the receipts of the deposits to the Treasury for the preceding 
fiscal year made by the integrated programs of the Missouri 
River Basin Pick-Sloan program, administered by the Western 
Area Power Administration, until the aggregate of the amounts 
deposited is equal to $27,500,000. The Secretary of the 
Treasury is authorized and directed to invest these amounts in 
interest-bearing obligations of the United States or in 
obligations guaranteed as to both principal and interest by the 
United States.
    Once the aggregate amount has been deposited in the Fund, 
the Secretary of the Treasury is authorized to transfer any 
interest which has accrued on the amounts deposited in the Fund 
into a separate account established by the Secretary in the 
Treasury, and thereafter, to transfer any funds in that account 
to the Secretary of the Interior for purposes authorized in S. 
1264, without fiscal year limitation on the availability of 
such funds. In turn, the Interior Secretary is authorized to 
make payments to the tribe, but the payments can only be used 
by the tribe for carrying out projects and programs pursuant to 
a plan for socioeconomic recovery and cultural preservation, 
and no payments may be distributed to any member of the tribe 
on a per capita basis.
    The plan is to be developed by the Bureau of Indian 
Affairs, the Indian Health Service and the Crow Creek Sioux 
Tribe, is subject to the approval of the Crow Creek Tribal 
Council, and must be submitted to the Congress no later than 
two years following the enactment of S. 1264. The plan must 
include the following programs and components: (1) an 
educational facility to be located on the tribe's reservation; 
(2) a comprehensive inpatient and out-patient health care 
facility to provide essential services that are needed and 
which are unavailable through existing facilities of the Indian 
Health Service on the Crow Creek Reservation; (3) the 
construction, operation and maintenance of a municipal, rural 
and industrial water system for the reservation; (4) 
recreational facilities suitable for high-density recreation at 
Lake Sharpe at Big Bend Dam; and (5) other projects and 
programs for the educational, social welfare, economic 
development, and cultural preservation of the tribe as the 
Interior Secretary considers appropriate.

                 synopsis of historical background \1\

    The Pick-Sloan Project, a compromise of the separate water 
resource programs developed by Colonel A. Pick of the Corps of 
Engineers and William G. Sloan of the Bureau of Reclamation, 
concerned the development of flood control measures to protect 
the lower Missouri Basin (Pick Plan) and the construction of 
irrigation facilities to the upper Missouri Basin (Sloan Plan), 
and was developed in response to the urgent demand for federal 
action that followed the devastating Missouri River floods of 
1942 and 1943.
---------------------------------------------------------------------------
    \1\ Synopsis of historical background is drawn from a report of the 
Historical Research Associates, Inc. prepared for the Crow Creek Sioux 
Tribe by Michael L. Lawson, Ph.D., on August 18, 1995, entitled ``An 
Analysis of the Impact of the Pick-Sloan Plan on the Crow Creek Sioux 
Tribe and of the Need for Federal Legislation to Address These 
Impacts.''
---------------------------------------------------------------------------
    Officially labelled the Missouri River Basin Development 
Program, the Pick-Sloan Plan was gradually expanded to include 
the construction of 150 multiple-purpose reservoir projects. In 
addition to flood control, these dams were designed to provide 
the benefits of hydroelectric power, navigation, recreation, 
and improved water supplies. The backbone of the Pick-Sloan 
Plan was provided by the six massive dams constructed by the 
Corps of Engineers on the main stem of the Missouri River; two 
of which (Fort Peck and Oahe) rank among the largest earth dams 
in the world. Together, these six projects inundated over 550 
square miles of Indian land and displaced more than 900 Indian 
families.
    Many of the problems encountered by the affected tribes and 
their tribal members came as a result of the Federal 
government's failure to provide an adequate administrative 
structure for the Pick-Sloan Plan. In response to the 
apparently overwhelming opposition to the creation of a 
Missouri Valley Authority, the Truman Administration placed the 
program under the rather loose-knit coordination of the 
Missouri Basin Inter-Agency Committee (MBIAC), a nonstatutory 
body.
    The Inter-Agency Committee took a piecemeal approach to 
Missouri Basin problems and was preoccupied with engineering 
methods that did not allow for adequate consideration of such 
important human factors as the condemnation of farms and 
ranches and the relocation of families. The Army Corps of 
Engineers had little in their training or backgrounds that 
prepared them to deal knowledgeably with Native Americans, and 
the Federal agency usually charged with that responsibility, 
the Bureau of Indian Affairs (BIA), was hampered during this 
period by a severely reduced budget and the threat of being 
abolished altogether by those in Congress who supported the 
``termination'' of the government's trust responsibilities for 
Indian lands and resources.
    While a more centralized administrative structure, such as 
that proposed for the Missouri Valley Authority, might have 
received an annual block appropriation for all of its 
activities and functions, the numerous agencies involved with 
Pick-Sloan had to deal with several separate committees in 
Congress for funding of their particular part of the overall 
program. This meant that the Army often received generous 
amounts for dam construction during years when the Sioux tribes 
were not able to receive appropriations for their necessary 
relocation nor compensation for their losses. Because of this 
lack of coordination, tribal members were systematically denied 
most of the important benefits offered by Pick-Sloan and their 
efforts at reconstruction fell far short of their needs.
    The Sioux Tribes knew little of the Pick-Sloan Plan until 
long after it had been approved. Although existing treaty 
rights provided that land could not be taken without their 
consent, none of the tribes were consulted prior to the 
program's enactment. The Bureau of Indian Affairs was fully 
informed, yet made no objections to the plan while it was being 
debated in Congress in 1944. The Bureau of Indian Affairs did 
not inform the tribes of the damages they would suffer until 
1947. The Corps of Engineers was so confident that it could 
acquire the Indian land it needed through Federal powers of 
eminent domain that it began construction on its dams, 
including those actually on reservation property, even before 
opening formal negotiations with the tribal leaders. The 
legislation establishing the Pick-Loan Plan did not address the 
Indians' reserved water rights under the Winters Doctrine.
    In 1947, the Bureau of Indian Affairs made its first effort 
to represent tribal interests within the Missouri Basin Inter-
Agency Committee. To assess fully the damages to Indian land 
resulting from Pick-Sloan, the BIA organized the Missouri River 
Basin Investigations Project (MRBI) within the structure of its 
regional office at Billings, Montana. Initially this agency was 
given the task of conducting both extensive reservation surveys 
and appraisals to estimate replacement costs as well as social 
and economic damages resulting from inundation. Later the MRBI 
was also assigned to help tribes gain equitable settlements and 
to assist relocation and reconstruction activities.
    By the time the first MRBI staff members reached the field, 
the Corps of Engineers had spent approximately $28 million on 
the preliminary constructions of three of its main-stem 
projects, including the Fort Randall Dam. A significant portion 
of the reservoir to be developed behind Fort Randall Dam, Like 
Francis Case, would flood Crow Creek reservation land and 
communities. Initial MRBI findings were not published until 
1949, by which time the Corps had spent an additional $37.5 
million on construction. Yet, it was not until these early MRBI 
appraisals were made available that the Crow Creek Sioux 
learned the full effect of Pick-Sloan on their reservation.
    Construction of the Fort Randall Dam began in May of 1946. 
This project was located downstream of the Crow Creek Indian 
Reservation, 100 miles southeast of Crow Creek and just above 
the Nebraska line in south-central South Dakota. When it was 
completed in 1969, Fort Randall provided a water storage 
capacity of 5.7 million acre-feet and a maximum hydroelectric 
power output of 320,000 kilowatts. The reservoir behind the dam 
stretched over 107 miles. Fort Randall was built with compacted 
earth fill, as were other army projects on the Missouri. Like 
Garrison and Oahe dams, it featured a relatively high-head dam 
(160 feet) and a chute-type spillway designed to release 
excessive flows. Although the Corps of Engineers estimated this 
project would cost $75 million in 1944, it ultimately cost more 
than $200 million.
    The Fort Randall Dam flooded 22,091 acres of Sioux land and 
dislocated 136 Indian families. Of the tribes affected, the 
Crow Creek Sioux were the hardest hit. Its tribal members lost 
9,514 acres of precious bottomland, over one-third of which was 
forested. Eighty-four families, representing approximately 34 
percent of the reservation population, were forced to evacuate 
their riverside homes and to accept land ill-suited for houses, 
ranches, or farms. For Thompson, the reservation's largest 
community, was completely inundated. The BIA agency 
headquarters there, which also served the Lower Brule Sioux, 
was moved fifty miles from the reservation to Pierre, the 
capital city of South Dakota. The Indian Health Service 
hospital was moved twenty miles south to Chamberlain. These 
facilities were now located over ninety miles from remote parts 
of the reservations. Because tribal offices remained on Indian 
land, it was no longer possible for the Crow Creek Sioux to 
take care of their BIA, public-health, and tribal business 
needs on the same day at the same location. For a people whose 
transportation facilities were severely limited, this situation 
created an immense hardship.
    While the Crow Creek Sioux were sustaining major damages 
from the Fort Randall project, the Corps of Engineers began 
work on the Big Bend Dam in September 1959. This project was 
located near the new townsite of Fort Thompson on land 
belonging to the Crow Creek and Lower Brule Tribes. The 
smallest of the Army's main-stem structures, Big Bend was 
developed primarily for hydroelectric power production. Taking 
advantage of the long bend in the river for which it named, 
engineers built a dam that produced 468,000 kilowatts and was 
just ninety-five feet high.
    The Big Bend project took an additional 21,026 acres of 
Sioux land. Crow Creek tribal members lost 6,417 acres to the 
dam project and were forced to move twenty-seven families. 
These damages affected 5 percent of the reservation's land base 
and 11 percent of its population. Approximately one-fourth of 
the tribe's remaining farms and ranches were also flooded. The 
government's handling of the Fort Randall relocations was 
apparently not well-thought out, because families on both the 
Crow Creek and the Lower Brule Reservations were relocated on 
lands within the projected area of the Big Bend Dam, and as a 
result, these families were subsequently forced to undergo the 
trauma of yet another move.
    Because their families and most important resources were 
concentrated near the Missouri River, resettlement devastated 
affected members of the Crow Creek Sioux Tribe. The natural 
advantages of their former homes could not be replaced on the 
marginal reservation lands that remained after inundation. The 
shaded bottomlands had provided an environment with plenty of 
wood, game, water, and natural food sources. Livestock grazed 
on abundant grasses and took shelter under the trees. The 
barren upland regions to which the Crow Creek people were 
forced to move were less hospitable, more rigorous, and 
presented far greater challenges to their survival.
    The bottomlands were critically important to the way of 
life of the Crow Creek people. Trees along the river had 
provided them with their primary source of fuel and lumber. The 
wooded areas also provided protection from the ravages of 
winter blizzards and the scorching summer heat. The gathering 
and selling of wood helped supplement their small cash income. 
The flooding of the forestlands destroyed the vast majority of 
timber on their reservation.
    The gathering and preserving of wild fruits and vegetables 
was a traditional part of the culture of the Crow Creek Sioux. 
Traditionally, they were also used for ceremonial and medicinal 
purposes. The loss of these and other plants greatly reduced 
the Crow Creek's natural food supply.
    The wooded bottomlands also served as a shelter and feeding 
ground for many kinds of wildlife. Deer, beaver, rabbits, and 
raccoons were abundant year-round, and numerous pheasants and 
other game birds wintered there each year. The hunting and 
trapping of this game provided the Crow Creek Sioux with an 
important source of food, income, and recreation. Wild fruit, 
including chokecherries, buffalo berries, gooseberries, and 
currants were readily available for picking. Destruction of 
this environment by the Pick-Sloan dams reduced the wild game 
and plant supply on the reservation by 75 percent.
    The loss of the bottomland grazing areas seriously crippled 
the livestock industry on Crow Creek. Ranching had become the 
primary economic activity on the reservation in the years prior 
to Pick-Sloan. A substantial number of Indian ranchers were 
forced either to liquidate their assets altogether or to 
establish smaller operations on the inferior reservation land 
that remained.
    The upland regions also presented a stiff challenge for 
Indian homeowners. The nature of the soil and terrain made 
irrigation impractical if not impossible, while the Pick-Sloan 
project flooded the most potentially irrigable lands. The Fort 
Randall and Big Bend projects, for example, destroyed the 
possibility of implementing plans proposed jointly by the BIA 
and the Bureau of Reclamation for sizable irrigation projects 
on the Crow Creek Reservation.

Initial efforts to achieve settlement of tribal claims

    Realizing they were powerless to stop the dams, Sioux 
tribal leaders were determined, nevertheless, to negotiate for 
payments and benefits which would allow them to fully utilize 
their remaining resources. In light of the congressional debate 
over the termination of Federal trust responsibilities, they 
also sought compensation that might permit them to make 
progress toward self-sufficiency, a goal established previously 
by the administration of Commissioner John Collier between 1933 
and 1945. Thus, tribal negotiators reasoned that a generous 
settlement might include the development of new programs and 
facilities for health, education, housing, community growth, 
and employment. They also hoped for such direct benefits from 
the dam projects as low-cost electrical power, irrigation, and 
improved water supplies.
    The Crow Creek Sioux Tribe was hampered in its initial 
efforts to obtain legal counsel, because the Indian 
Commissioner, Dillon S. Meyer, refused to grant his necessary 
approval of a tribal contract with first one, and then a second 
attorney proposed by the tribe. The American Civil Liberties 
Union provided funds for lawyers to serve as unofficial tribal 
representatives in preliminary negotiations that began in 1952, 
but eventually, the tribe felt compelled to find an attorney 
who met Commissioner Meyer's approval, settling on M.Q. Sharpe, 
a local lawyer previously engaged by the Lower Brule Sioux and 
the former governor of South Dakota. As chairman of the 
Missouri River States Committee, Sharpe had been a leading 
advocate of the Army's main-stem Missouri River projects during 
the 1944 congressional debate on the Pick-Sloan Plan.
    Recognizing its obligation to ensure that the Sioux tribes 
affected by Pick-Sloan received just compensation, in 1950, the 
Congress authorized the Corps of Engineers and the BIA to 
negotiate separate settlement contracts with representatives of 
the Standing Rock and Cheyenne River Sioux Tribes. In addition 
to providing payment for all damages, these agencies were 
directed to cover the costs of relocating tribal members ``so 
that their economic, social, and religious life can be 
reestablished and protected.'' Each of the agencies was 
required to prepare a detailed analysis of damages, and in the 
event that they could not reach a satisfactory agreement in the 
field, the Congress was to legislate a final settlement.
    The Crow Creek Tribe petitioned in 1951 for prompt 
enactment of similar settlement procedures for their 
negotiations, but Congress did not act until 1954. In the 
meantime the tribes were not idle. Meetings were held on the 
reservations to discuss contract terms, negotiating committees 
were appointed, and contracts for legal counsel were finally 
approved. Damage appraisals were prepared by both the Army and 
the BIA; MRBI staff members conducted socioeconomic surveys; 
and tribal lands were inspected by Commissioner Meyer.
    In 1951, the BIA announced that because of the Fort Randall 
project, it planned to move its facilities at Fort Thompson, 
which served both the Crow Creek and Lower Brule Tribes, to the 
non-Indian community of Chamberlain, South Dakota. It also 
proclaimed that all schools on the reservations would be closed 
and students would be transferred to nearby public 
institutions. Hospital facilities at Fort Thompson had already 
been moved to Chamberlain the previous year.
    The tribe vehemently opposed those decisions, which it 
viewed as an initial step toward termination of Federal trust 
services. Tribal leaders protested that the relocation plan 
would create undue hardship, especially since they felt 
strongly that the citizens of Chamberlain were prejudiced 
toward tribal members. In a petition to D'Arcy McNickle of the 
BIA's Tribal Affairs office, they asked that the decision be 
reconsidered.
    In a letter to Herbert Wounded Knee, Crow Creek Tribal 
Chairman, Commissioner Meyer denied that an official decision 
had been made concerning the Fort Thompson facilities. He 
assured the tribal leader that the Bureau of Indian Affairs had 
no intention of either ignoring tribal desires or depriving 
tribal members of their rights, but in executive conference 
with other BIA administrators on February 1, 1952, the 
Commissioner reaffirmed the earlier decisions. On July 21, 
1952, the gates of Fort Randall Dam were closed, and by the end 
of the year portions of the Crow Creek Reservation were under 
water, while the tribe still awaited the initiation of 
settlement talks. Negotiations were finally opened at Fort 
Thompson on March 9, 1953.
    The Corps of Engineers offered the Crow Creek negotiators 
$375,613 for their land and improvements. This settlement was 
based on an appraisal made by the Corps' Real Estate Division, 
BIA officials offered $399,313, an amount reached by MRBI 
appraisers. When tribal attorney Sharpe asked Corps officials 
if they would accept the higher MRBI figures, they refused. The 
Corps then threatened to take the land by condemnation if an 
agreement could not be reached quickly. Several other meetings 
were held during the next few months, but all failed to bring 
the parties closer to settlement.
    Army attorneys began preparing condemnation suits for the 
taking of the Crow Creek land without waiting for further 
developments. They claimed that the rising pool level of the 
Fort Randall reservoir and the long delay of Congress in 
establishing settlement guidelines left them no alternative. 
The tribe was assured that 90 percent of the appraised value of 
tribal property would be made immediately available to it 
through the Federal courts, and that this legal action would in 
no way affect the eventual settlement from Congress. On June 1, 
1953, a tentative agreement between the Army and the tribe's 
attorney was reached which included the tribe's right to use 
the land free of charge until a final settlement could be 
reached and the retention of all mineral rights within the 
reservoir area.
    On August 4, 1953, the Army filed suit in the United States 
District Court of South Dakota in an attempt to obtain title to 
lands on the Crow Creek and Lower Brule reservations. The 
action went unchallenged, the Court passed favorably on the 
condemnation request, and the Corps of Engineers again 
succeeded in circumventing its legal obligations to the 
Indians. Despite previous agreements, an amount equal to the 
Army's land appraisal rather than that of the BIA was deposited 
with the Court, but this money was never distributed to the 
tribes. The United States District Attorney's office failed to 
file a declaration of taking, which would have given the Army 
full title to the land, before the Congress finally passed a 
law establishing legal guidelines for the Fort Randall 
negotiations in July 1954. This act required Federal 
representatives to open new talks with the tribes. When these 
negotiations failed to bring about an agreement by 1955, the 
Justice Department permitted the Army to proceed with its 
original condemnation suits.

The Fort Randall settlement

    By 1954, construction of the Fort Randall Dam was 84 
percent complete, all non-Indian land needed for the project 
had been acquired, and the pool level of the reservoir was 
rising rapidly, while Indian property owners still awaited 
Congressional action. Legislation providing a settlement for 
the Yankton Sioux and establishing contract guidelines for the 
Crow Creek and Lower Brule Tribes was approved on June 6, 1954.
    Negotiation guidelines established for the Crow Creek Sioux 
were similar to those provided for the Cheyenne River and 
Standing Rock Tribes in 1950, with some important exceptions. 
The growing urgency of the situation caused the Congress to 
shorten time limits for further talks; BIA and Army 
representatives were given only a year to obtain a contract 
agreement. Despite treaty provisions and precedents established 
in earlier settlements with the Fort Berthold and Cheyenne 
River Tribes, tribal ratification requirements were lowered 
from three-fourths of the adult tribal members to a simple 
majority. The Interior Department had recommended this action 
in order to expedite approval. The retention of tribal mineral 
rights was limited to gas and oil.
    New talks with the Crow Creek Sioux Tribe were rekindled in 
the autumn of 1954 but ended again in deadlock. The BIA raised 
its offer for a property settlement to allow for the increase 
in land values since 1951, the year of the last MRBI appraisal. 
The Corps of Engineers refused to offer any more than the 
amount it had previously deposited with the Federal court in 
its condemnation suits of 1953. Although the tribes were 
increasingly pressured by the impending flood, they were 
determined to hold out for better terms. In the meantime tribal 
leaders were compelled by circumstances to make plans for the 
evacuation of their lands.
    Crow Creek families within the Fort Randall taking area 
faced the prospect of having their homes inundated during the 
spring runoff of 1955, yet they still had no money with which 
to move. Condemnation funds deposited with the court were not 
available because the Justice Department had not yet filed a 
``declaration of taking'' on the land, and the chances for a 
timely congressional settlement appeared increasingly dim. 
Because it was anticipated that favorable agreements could not 
be reached with BIA and Army representatives, Senator Francis 
Case and Congressman E.Y. Berry of South Dakota were asked to 
introduce settlement legislation for the tribes in the 83d 
Congress. These bills, which proposed $5,686,036 for the Crow 
Creek Sioux Tribe, were not considered by the Congress. As a 
result, the tribe expected that it would have to use its own 
meager funds to help families relocate. During the fall of 1954 
tribal leaders began planning for this eventuality.
    Following the breakdown of negotiations in November 1954, 
both the Army and BIA requested that the Justice Department 
carry out the condemnation suits filed in 1953. The Corps of 
Engineers wanted clear title to the land, and the Bureau of 
Indian Affairs wanted some money dispersed to tribal members 
before they were forced to move. As a result, an official 
declaration of taking was filed on January 20, 1955. The court 
allowed the Army to take the Indian land it needed--the 
legality of the suit was not questioned. The Corps of Engineers 
later claimed that its action was legal because the settlement 
guidelines, established by the Congress in the previous year, 
had stipulated that negotiations would not be allowed to 
interfere with the scheduled construction of the Fort Randall 
project. The Army, however, had filed suit before the 
legislation was enacted, and the Act did not authorize the 
Corps of Engineers to exercise the rights of eminent domain.
    On March 22, 1955, Indian landowners on Crow Creek 
Reservation received $399,313 from the Court as partial payment 
for their property. The Army had been required to deposit an 
additional $23,700 in order to bring payments up to the MRBI 
appraisal figures. BIA assistance was requested in the 
distribution and expenditure of these funds, and a tribal 
committee was formed to plan relocation activities.
    The Crow Creek Sioux Tribe, like the Standing Rock Sioux, 
was compelled for three more years to pursue a legislative 
settlement. New legislation incorporating tribal demands was 
introduced in the 84th and 85th Congresses; but despite the 
obvious urgency of the settlements, the Congress did not act, 
and in the meantime, the Fort Randall project, 99 percent 
complete according to Army reports, was officially dedicated on 
August 11, 1956.
    While legislation was being considered in the Congress, in 
January of 1958, an injunctive action was filed on behalf of 
the Standing Rock Sioux Tribe in Federal district court to halt 
further construction of the Oahe Dam project until an adequate 
settlement was negotiated with the tribe, arguing that the 
Corps of Engineers did not have the legal authority to condemn 
Standing Rock property, citing the Sioux treaty of 1868, which 
was reaffirmed by acts of Congress in 1877 and 1889. The acts 
proclaimed that land could be taken from the tribe only upon 
payment of just compensation and the consent of three-fourths 
of its adult membership. The action also sought to establish 
that even though the Supreme Court had determined that the 
Congress had the right of eminent domain over Indian land as 
long as just compensation was provided in accordance with the 
Fifth Amendment, the Court had also ruled in at least two cases 
that this power rested only with the Congress and could not be 
extended to other Federal agencies without express 
authorization.
    The presiding Judge, George T. Mickelson, a former governor 
of South Dakota, decided on March 10, 1958 to uphold the 
tribe's motion to dismiss the Army's condemnation suit. In 
doing so, he ruled that the Congress had not authorized the 
Corps to take Indian lands by any legislative act, including 
the Flood Control Act of 1944. ``It is clear to this Court,'' 
he observed, ``that Congress has never provided the requisite 
authority to the Secretary of the Army to condemn this tribal 
land. Such action is wholly repugnant to the entire history of 
Congressional and judicial treatment of the Indians.''
    Six months later, settlement legislation for the Crow Creek 
Sioux, the Lower Brule and Standing Rock Sioux Tribes, was 
enacted into law. The Crow Creek Sioux finally received 
$1,395,812 for their property, including their interest in the 
riverbed and all damages caused by the Fort Randall project. 
Unlike the Standing Rock Sioux, the tribe was denied 
rehabilitation money and the right to regain ownership of any 
former property found unnecessary for the project.
    Although no limit was placed on moving costs, the tribe was 
required to pay all relocation expenses out of settlement 
funds. The Standing Rock and Cheyenne River legislation had 
provided that such costs would be charged to the Corps of 
Engineers' project budget. In addition, the Crow Creek Sioux 
did not receive protection for livestock hazards as the 
Cheyenne River Tribe had or the right to ratify the final 
agreement, nor were they permitted the same degree of autonomy 
over control and distribution of settlement funds, relocation 
of tribal members, or consolidation of their land.
    Of all the Sioux Tribes, only the Crow Creek and Lower 
Brule had suffered the hardship of having to move two years 
before receiving a settlement, and they alone had been denied 
funds for rehabilitating their reservations, although their 
poverty was relatively greater. They were also the only tribes 
that would face the same ordeal again.

The Big Bend settlement

    Even as tribal negotiators were in Washington seeking 
compensation for Fort Randall damages, Army crews were out 
surveying Crow Creek land for the Big Bend project. 
Construction of this dam was scheduled to begin in September 
1960, thereby making it necessary for the tribe to negotiate a 
settlement by that time if it hoped to avoid losing more land 
without adequate compensation. The Corps of Engineers, however, 
worked ahead of schedule and ground-breaking ceremonies for the 
project took place on May 30.
    Legislation for the Crow Creek and Lower Brule Tribes was 
not introduced in Congress until March 2, 1960. A week later, 
the Corps of Engineers again filed suit in Federal district 
court to condemn the 867 acres of Indian land needed for the 
actual project site, despite the earlier decision handed down 
by the same court in the Standing Rock suit in 1958. Congress 
had still not specifically delegated its powers of eminent 
domain to the Army, yet the Corps of Engineers was allowed to 
take title to the reservation land.
    The tribe received a final settlement on October 3, 1962. 
The Crow Creek Sioux Tribe was granted $355,000 for its direct 
damages (including the loss of the riverbed and gravel), 
$209,302 for indirect damages, and $3,802,500 for 
rehabilitation: a total of $4,366,802. Moving expenses were 
limited to $77,550 and negotiating expenses to $75,000. 
Requests for shoreline boundary markers, fire protection, and 
unrestricted grazing, hunting, and fishing rights were denied. 
The tribe received the same salvage and shoreline rights 
provided in all previous Pick-Sloan tribal settlements, subject 
to Federal regulation, but with the additional right to lease 
shoreline grazing areas to non-Indians if the tribe chose. No 
provision was given for special tribal funds to be developed 
from these revenues as the tribe had hoped, and the Corps of 
Engineers was given the authority to regulate the location, 
size, and nature of all lands so used.

Reconstruction

    With the passage of the Big Bend settlements in 1962, the 
Federal government acquired the last tribal lands needed for 
the Pick-Sloan main-stem projects. Over the span of fourteen 
years and at a cost of over $34 million, the United States had 
obtained title to approximately 204,124 acres of Sioux 
property, more Indian land than was taken for any other public 
works project in the United States. None of the tribes 
considered their compensation adequate. As long and arduous as 
the process of negotiating final settlement was, it represents 
only the first stage of the Pick-Sloan ordeal for the tribes 
affected. Once compensation was received, and benefits and 
provisions were outlined by law, or even earlier in the case of 
the Fort Randall takings, plans had to be implemented for the 
relocation of tribal members and their property, the 
reconstruction and restoration of reservation facilities and 
services, and the rehabilitation of entire Indian communities.
    For the Sioux Tribes, the period of reconstruction was the 
most difficult phase of the Pick-Sloan experience. The Sioux 
Tribes affected by Pick-Sloan often experienced as much 
difficulty in obtaining their funds as the government did in 
distributing them. The Crow Creek Sioux had a particularly 
difficult time in relocating families from the Fort Randall 
reservoir area. Because the tribe only received money from the 
Army's condemnation settlement at the time they were forced to 
move, its relocation program had to be tailored to fit the 
funds available rather than the goal of full reestablishment as 
contemplated by the Congress. Aimed at immediate results rather 
than comprehensive rehabilitation, its programs failed to 
provide for such crucial items as development of satisfactory 
water supplies, construction of sufficient housing, or 
reestablishment of lost sources of income.
    Although the Fort Randall project had been announced a full 
decade earlier, neither the Army nor the Bureau of Indian 
Affairs was prepared to implement an efficient relocation 
program when the time came for the Indians to move. Though it 
was clearly their responsibility to do so, neither agency had 
bothered to survey the reservations for new homesites or to 
investigate the actual cost of building materials. They failed 
to keep tribal members fully informed about the relocation 
plans affecting them. Kept in uncertainty until the last 
possible moment, the tribe was compelled to proceed in haste 
when the time came to evacuate its lands.
    Tribal families were crowded into temporary quarters until 
houses could be relocated and restored. In the chaos that 
followed, many were assigned to the wrong tracts of land and 
eventually had to move a second time. Shacks that should have 
qualified only for destruction had to be moved and repaired 
simply because there was not enough money for new housing.
    The relocation of government facilities generated 
controversy over the selection of a new agency site. In most 
cases involving the other tribes affected by Pick-Sloan, the 
nearest suitable upland area was designated as the new 
relocation site. But crucial BIA facilities serving the Crow 
Creek Sioux were moved completely off the reservation. Tribal 
facilities and individual residences were relocated from the 
Fort Thompson townsite to the nearest convenient upland 
locations.
    Although the Congress carefully prescribed both the 
quantity and quality of replacement structures for the new Fort 
Thompson townsite in the Big Bend Settlement Act, the BIA and 
the Corps of Engineers failed to fulfill the intent of the 
statute. In some cases, the tribe did not get its facilities 
replaced or restored adequately or at all. The Corps of 
Engineers built a new elementary school, which soon proved to 
be inadequate and of poor construction, but the high school was 
never replaced. The hospital at Fort Thompson was never 
replaced and the Indian Heath Service did not bring a facility 
back to the reservation until 1980. Homes were not insulated 
sufficiently to endure the rigors of harsh Dakota winters and 
water lines for the new homes were placed on the roofs, and 
subsequently burst.

                          legislative history

    Senator Daschle introduced S. 1264 on September 20, 1995. 
The bill was referred to the Committee on Indian Affairs, and 
the Committee held a hearing on S. 1264 on April 25, 1996.

            committee recommendation and tabulation of vote

    On July 18, 1996, the Committee on Indian Affairs, in an 
open business session, considered S. 1264 and ordered it 
reported with an amendment in the nature of a substitute, with 
a recommendation that the bill, as amended, be passed.

                      section-by-section analysis

    Section 1. This section sets forth the short title of the 
Act, which is to be cited as the Crow Creek Sioux Tribe 
Infrastructure Development Trust Fund Act of 1996.
    Section 2. This section sets forth the findings of the 
Congress.
    Section (a)(1) expresses the findings of the Congress that 
the Congress approved the Pick-Sloan Missouri basin program by 
passing the Flood Control Act of 1944 to promote the general 
economic development of the United States, to provide for 
irrigation about Sioux City, Iowa, to protect urban and rural 
areas from devastating floods of the Missouri River, and for 
other purposes.
    Section (a)(2) expressed the finding of the Congress that 
the Fort Randall and Big Bend projects are major components of 
the Pick-Sloan program, and contribute to the national economy 
by generating a substantial amount of hydropower and impounding 
a substantial quantity of water.
    Section (a)(3) expresses the finding of the Congress that 
the Fort Randall and Big Bend project overlie the western 
boundary of the Crow Creek Indian Reservation, having inundated 
the fertile, wooded bottom lands of the tribe along the 
Missouri River that constituted the most productive 
agricultural and pastoral lands of the Crow Creek Sioux Tribe 
and the homeland of the members of the tribe.
    Section (a)(4) sets forth the finding of the Congress the 
Public Law 85-916 authorized the acquisition of 9,418 acres of 
Indian land on the Crow Creek Indian Reservation for the Fort 
Randall project and Public Law 87-735 authorized the 
acquisition of 6,179 acres of Indian land on Crow Creek for the 
Big Bend project.
    Section (a)(5) sets forth the finding of the Congress that 
Public Law 87-735 provided for the mitigation of the effects of 
the Fort Randall and Big Bend projects on the Crow Creek Indian 
Reservation, by directing the Secretary of the Army to: (A) 
replace, relocate, or reconstruct any existing essential 
governmental and agency facilities on the reservation, 
including schools, hospitals, offices of the Public Health 
Service and the Bureau of Indian Affairs, service buildings, 
and employee quarters, as well as roads, bridges, and 
incidental matters or facilities in connection with such 
facilities; (B) provide for a townsite adequate for 50 homes, 
including streets and utilities (including water, sewage, and 
electricity), taking into account the reasonable future growth 
of the townsite; and (C) provide for a community center 
containing space and facilities for community gatherings, 
tribal offices, tribal council chamber, offices of the Bureau 
of Indian Affairs, offices and quarters of the Public Health 
Service, and a combination gynasium and auditorium.
    Section (a)(6) contains the finding of the Congress that 
the requirements of Public Law 87-735, with respect to the 
mitigation of the effects of the Fort Randall and Big Bend 
projects on the Crow Creek Sioux Indian Reservation have not 
been fulfilled.
    Section (a)(7) expresses the finding of the Congress that 
although the national economy has benefitted from the Fort 
Randall and Big Bend projects, the economy on the Crow Creek 
Sioux Indian Reservation remains underdeveloped, in part as a 
result of the failure of the United States to fulfill its 
obligations under Public Law 85-916 and Public Law 87-735.
    Section (a)(8) contains the finding of the Congress that 
the economic and social development and cultural preservation 
of the Crow Creek Sioux Tribe will be enhanced by increased 
tribal participation in the benefits of the Fort Randall and 
Big Bend components of the Pick-Sloan program.
    Section (a)(9) expresses the finding of the Congress that 
the Crow Creek Sioux Tribe is entitled to additional benefits 
of the Pick-Sloan Missouri River basin program.
    Section 3. Section 3 of S. 1264 sets forth the definition 
of terms used in the bill.
    Section (3)(1) provides that the term ``fund'' as used in 
the bill, is intended to mean the Crow Creek Sioux Tribe 
Infrastructure Development Fund which would be established 
under the authority contained in section 4(a) of the bill.
    Section (3)(2) provides that the term ``plan'' as used in 
the bill, is intended to mean the plan for socioeconomic 
recovery and cultural preservation prepared under the authority 
of section 5 of the bill.
    Section (3)(3) provides that the term ``program'' is 
intended to refeer to the power program of the Pick-Sloan 
Missouri River basin program that is administered by the 
Western Area Power Administration.
    Section (3)(4) provides that the term ``Secretary'' is 
intended to refer to the Secretary of the U.S. Department of 
the Interior.
    Section (3)(5) provides that the term ``tribe'' as used in 
the bill, means the Crow Creek Sioux Tribe of Indians, a band 
of the Great Sioux Nation recognized by the United States.
    Section 4. Section 4 of S. 1264 provides for the 
establishment of the Crow Creek Sioux Tribe Infrastructure 
Development Fund.
    Subsection (a) establishes a fund in the U.S. Treasury to 
be known as the ``Crow Creek Sioux Tribe Infrastructure 
Development Trust Fund.''
    Subsection (b) requires the Secretary of the Treasury to 
deposit into the Trust Fund 25 percent of the receipts from the 
deposits to the Treasury from the power program of the Pick-
Sloan Missouri River basin program until deposits equal 
$27,500,000.
    Subsection (c) requires the Secretary of the Treasury to 
invest the money in the Trust Fund only in interest-bearing 
obligations of the United States or in obligations guaranteed 
as to both principal and interest by the United States.
    Subsection (d) requires the Secretary of the Treasury, 
beginning in the fiscal year immediately following the fiscal 
year in which the Trust Fund is fully funded, to transfer any 
interest earned on Trust Fund into a separate account which 
shall be available, without fiscal year limitation, to the 
Secretary of the Interior. The Secretary of the Interior may 
only withdraw funds from the account to make payments to the 
tribe, which can only use the funds to carry out projects and 
programs pursuant to the plan prepared under section 5. No per 
capita payments may be made to any tribal member.
    Subsection (e) bars the Secretary of the Treasury from 
making any withdrawals from the Trust Fund except to make 
payments to the Secretary of the Interior to make payments to 
the tribe.
    Section 5. Section 5 of the bill provides authority for the 
development of a plan for socioeconomic recovery and cultural 
preservation.
    Subsection (a) requires the tribe, within two years of 
enactment of the bill, to prepare a plan for use of the funds 
to be paid to the tribe by the Secretary of the Interior. In 
developing the plan, the tribe must consult with the Secretary 
of Department of Interior and the Secretary of the Department 
of Health and Human Services. The plan shall identify the costs 
and benefits of each of its components.
    Subsection (b) requires the plan to include (1) an 
educational facility; (2) a comprehensive inpatient and 
outpatient health care facility to provide essential services 
unavailable through existing facilities of the IHS on the 
reservation; (3) the construction, operation and maintenance of 
a municipal, rural and industrial water system; (4) facilities 
suitable for high-density recreation at Lake Sharpe at Big Bend 
Dam and at other locations on the reservation; and (5) other 
projects and programs for the educational, social welfare, 
economic development, and cultural preservation of the tribe as 
the tribe considers appropriate.
    Section 6. Section 6 of S. 1264 authorizes the 
appropriation of such sums as may be necessary to carry out the 
provisions of the bill, including funds for administrative 
expenses associated with the Trust Fund established under 
section 4.
    Section 7. Section 7 of S. 1264 addresses the effect of 
payments to the Crow Creek Sioux Tribe.
    Subsection (a) provides that no payment to the tribe 
pursuant to this Act shall result in the reduction or denial of 
any service or program to which, pursuant to Federal law, the 
tribe is otherwise entitled because of its status as a 
Federally recognized Indian tribe, or to which any individual 
tribal member is entitled because of that individual's status 
as a member of the Tribe.
    Subsection (b) provides that no payment made under this Act 
shall affect Pick-Sloan Missouri River basin power rates, and 
that nothing in this Act may be construed as diminishing or 
affecting any right of the tribe that is not otherwise 
addressed in this Act, or any treaty obligation of the United 
States.

                   cost and budgetary considerations

    The cost estimate for S. 1264, as amended, as calculated by 
the Congressional Budget Office, is set forth below:

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, August 9, 1996.
Hon. John McCain,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 1264, the Crow Creek 
Sioux Tribe Infrastructure Development Trust Fund Act of 1996.
    Enacting S. 1264 would not affect direct spending or 
receipts. Therefore, pay-as-you-go procedures would not apply 
to the bill.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               congressional budget office cost estimate

    1. Bill number: S. 1264.
    2. Bill title: Crow Creek Sioux Tribe Infrastructure 
Development Trust Fund Act of 1996.
    3. Bill status: As ordered reported by the Senate Committee 
on Indian Affairs on July 24, 1996.
    4. Bill purpose: S. 1264 would provide for compensation to 
the Crow Creek Sioux Tribe for the taking of tribal lands for 
the site of the Fort Randall and Big Bend Dam projects. The 
bill would establish an economic recovery fund for the tribe 
and make interest earned by the fund available to the tribe for 
education, health, maintenance of water systems, and other 
purposes.
    5. Estimated cost to the Federal Government: CBO estimates 
that enacting S. 1264 would create new direct spending 
authority of about $1.4 million each year, beginning in fiscal 
year 1998. We estimate that the resulting outlays would total 
about $4 million over the 1997-2002 period, as shown in the 
following table.

                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                   1997       1998       1999       2000       2001       2002  
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Estimated budget authority....................          0        1.5        1.4        1.4        1.4        1.4
Estimated outlays.............................          0        0.2        0.5        0.8        1.1        1.3
----------------------------------------------------------------------------------------------------------------

    The costs of this bill fall within budget function 450.
    6. Basis of estimate: S. 1264 would establish a Crow Creek 
Sioux Tribe Infrastructure Development Trust Fund, into which 
would be deposited an amount equal to 25 percent of the 
previous year's receipts from the power program of the Pick-
Sloan Missouri River basin program, with a cap of no more than 
$27.5 million. Since the power program's receipts for fiscal 
year 1996 are estimated to be greater than $200 million, CBO 
expects that the fund would be fully capitalized in fiscal year 
1997. This transfer would be intragovernmental and there would 
be no outlays associated with such principal deposits.
    The bill would direct that the principal be invested in 
interest-bearing Treasury obligations. The interest would be 
transferred to another account, which the tribe would be able 
to use for various purposes. S. 1264 states that the interest 
would be made available to the Secretary of the Interior to the 
tribe the year after the Infrastructure Development Trust Fund 
is fully funded. Assuming a transfer to the fund early in 
fiscal year 1997, CBO estimates that interest earnings of about 
$1.4 million would be made available to the tribe in fiscal 
year 1998 and in each subsequent year. These amounts would be 
available for spending without appropriations action. Estimated 
outlays of this interest by the tribe are based on historical 
spending rates for programs with similar goals and activities 
as those stated in the bill.
    7. Pay-as-you-go considerations: Section 252 of the 
Balanced Budget and Emergency Deficit Control Act of 1985 sets 
up pay-as-you-go procedures for legislation affecting direct 
spending or receipts through 1998. CBO estimates that enacting 
S. 1264 would affect direct spending in the form of payments to 
the Crow Creek Sioux Tribe from the tribe's Infrastructure 
Development Trust Fund. Such payments would begin in fiscal 
year 1998, but we estimate that outlays would total less than 
$500,000 in that year. The following table summarizes the 
estimated pay-as-you-go impact of this bill.

                [By fiscal years, in millions of dollars]               
------------------------------------------------------------------------
                                            1996       1997       1998  
------------------------------------------------------------------------
Change in outlays......................          0          0          0
Change in receipts.....................      (\1\)      (\1\)      (\1\)
------------------------------------------------------------------------
\1\ Not applicable.                                                     

    8. Estimated impact on State, local, and tribal 
governments: S. 1264 contains no intergovernmental mandates as 
defined in the Unfunded Mandates Reform Act of 1995 (Public Law 
104-4).
    Section 5 of the bill would require the Crow Creek Sioux 
Tribe to prepare a plan for using payments from the federal 
government authorized by section 4 as a condition of receiving 
those payments and would specify a number of elements to be 
included in the plan. Based on information provided by the 
tribe, CBO estimates that the cost of complying with this 
requirement would be about $500,000 over two years. The bill 
would not authorize any funds for preparing the plan, but the 
annual payments received from the federal government would be 
used by the tribe to carry out projects included in the plan.
    S. 1264 would impose no other costs on state, local, or 
tribal governments.
    9. Estimated impact on the private sector: This bill would 
impose no new private-sector mandates as defined in Public Law 
104-4.
    10. Previous CBO estimate: None.
    11. Estimate prepared by: Federal Cost Estimate: Rachel 
Robertson. Impact on State, Local, and Tribal Governments: 
Marjorie Miller. Impact on the Private Sector: Amy Downs.
    12. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

               regulatory and paperwork impact statement

    Paragraph 11(b) of rule XXVI of the Standing Rules of the 
Senate requires each report accompanying a bill to evaluate the 
regulatory and paperwork impact that would be incurred in 
carrying out the provisions of the bill.
    The Committee believes that the enactment of S. 1264 will 
have a minimal regulatory or paperwork impact.

                        executive communications

    The Committee received the following report from the U.S. 
Department of the Interior setting forth the position of the 
Administration on S. 1264, as introduced. Issues identified in 
the Interior Department's report to the Committee have been 
addressed in the amendment in the nature of a substitute to S. 
1264.

                   U.S. Department of the Interior,
                                   Office of the Secretary,
                                     Washington, DC, July 17, 1996.
Hon. John McCain,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: I am pleased to transmit our report on 
the Department of the Interior's views in support of S. 1264, a 
bill to provide for certain benefits of the Missouri River 
basin Pick-Sloan project to the Crow Creek Sioux Tribe. This 
report addresses the issues raised during the Department's 
testimony at the joint hearing before your Committee and the 
House Subcommittee on Native Americans and Insular Affairs on 
April 25, 1996.
    We believe the Crow Creek Sioux Infrastructure Development 
Act of 1995 is an appropriate vehicle through which the Tribe 
can realize the benefits promised them by the Big Bend Act of 
1962, which required the replacement of infrastructure lost as 
a consequence of dam construction. Moreover, the bill is 
consistent with the language and intent of the Missouri River 
Pick-Sloan Program, which was authorized as part of the Flood 
Control Act of 1944 to provide benefits of the Missouri River 
irrigation and power development. We find that the language of 
and responsibilities described in these key acts are consistent 
with the federal government's trust responsibilities and other 
federal law. There is precedent for the bill's approach in the 
1992 enactment of the Three Affiliated Tribes and Standing Rock 
Sioux Equitable Compensation program (106 Stat. 4731), which we 
strongly supported, and the associated General Accounting 
office documentation of the impacts of dam construction on the 
tribes of the Missouri River basin.
    It is within the context of our support for this bill that 
we now offer proposed amendments that will strengthen its 
implementation and address the issues identified during the 
Joint hearing on April 25. The proposed amendments discussed 
herein will correct certain definitions and program language; 
provide for the remedy of potential appropriations problems; 
authorized the Tribe to prepare the Plan, and provide for the 
costs for the operation and maintenance of the new school 
facility.

Program language and definitions

    Certain minor definition and language changes will clarify 
the bill, specifically in sections 3 and 4. Section 3(3) should 
be revised to read: ``The term `program' means the power 
program of the Pick-Sloan Missouri Basin Program (Eastern 
Division), as administered by the Western Area Power 
Administration. In Section 4(b), language should be added after 
the word ``Fund'' on line 13 to reflect that these funds are 
nonreimbursable and nonreturnable. This suggested language is 
consistent with the language used in the Three Affiliated and 
Standing Rock Sioux legislation.

Remedy of potential appropriations problems

    In the Administration's testimony before the Committees in 
April, a concern was raised referencing potential PAYGO 
problems with the interest payment to the tribe generated from 
the corpus of the $27.5 million trust fund established under 
the legislation. It is our understanding that the 
capitalization of the Fund can be achieved in two years, and 
does not pose any PAYGO concerns for the Administration.
    However, the Office of Management and Budget notes that 
Pay-As-You-Go procedures would apply, because the bill makes 
the interest on the trust fund available for expenditure. This 
would be scored as an increase in outlays of $1.5 million per 
year, and could contribute to a sequester if it is not fully 
offset. This proposal should be considered in conjunction with 
all other proposals that are subject to the PAYGO requirement.
    Given the Administration's support for the bill, however, 
we have identified a number of options through which to remedy 
the potential PAYGO problem, and offer them for your 
consideration. First, we believe it is possible to find an 
offset for the $1.5 million interest, perhaps by searching for 
smaller offsets which amount in total to $1.5 million from 
different areas of the budget. As a second option, we believe 
it would be possible to permit the tribe to draw upon the 
interest after some time period (for example, seven years), as 
in the Three Affiliated model. In order to provide the tribe 
with planning funds while interest on the Fund accumulates, we 
would recommend that a portion of the annual interest generated 
on the Fund (for example $250,000) be available annually to the 
tribe.
    Any of these options could be implemented by amending 
Section 4(b) and (d)(2). We would support any or a combination 
of the options described above.

Plan development

    As stated during the hearing, we suggested that the tribe 
rather than the Secretary develop the infrastructure plan. 
Given that the Administration strongly supports the concept of 
and programs for self governance of American Indians, we 
recommend that the Crow Creek Sioux Tribe bear the primary 
responsibility for planning tribal development. While we expect 
the tribe to coordinate closely with the Secretaries of 
Interior and Health and Human Services, we believe the tribe is 
fully capable of planning its own infrastructure development. 
This can be achieved by amending Sections 5(a), 5(b) and 6 to 
provide for the tribe's primary responsibility.
    The Office of Management and Budget advises that there is 
no objection to the submission of this report from the 
standpoint of the Administration's program.
    Thank you for the opportunity to submit this report in 
support of S. 1264. Should you have further questions, please 
contact me.
            Sincerely,
                                        Michael J. Anderson
            (For Ada E. Deer, Assistant Secretary--Indian Affairs).

                        changes in existing law

    In compliance with subsection 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill are required to be set out in the accompanying 
Committee report. The Committee states that enactment of S. 
1264 will not result in any changes in existing law.