[Senate Report 108-397]
[From the U.S. Government Publishing Office]
Calendar No. 787
108th Congress Report
SENATE
2d Session 108-397
======================================================================
PROVIDING FOR EQUITABLE COMPENSATION TO THE SPOKANE TRIBE OF INDIANS OF
THE SPOKANE RESERVATION FOR THE USE OF TRIBAL LAND FOR THE PRODUCTION
OF HYDROPOWER BY THE GRAND COULEE DAM, AND FOR OTHER PURPOSES
_______
October 8, 2004.--Ordered to be printed
_______
Mr. Campbell, from the Committee on Indian Affairs, submitted the
following
R E P O R T
[To accompany S. 1438]
The Committee on Indian Affairs, to which was referred the
bill (S. 1438) to provide for equitable compensation to the
Spokane Tribe of Indians of the Spokane Reservation in
settlement of claims of the tribe concerning the contribution
of the tribe to the production of hydropower by the Grand
Coulee Dam, and for other purposes, having considered the same,
reports favorably thereon with an amendment in the nature of a
substitute with an amendment to the title and recommends that
the bill, as amended, do pass.
Purpose
The purpose of S. 1438 is to provide equitable compensation
to the Spokane Tribe for a fair share of the annual hydropower
revenues for the use of tribal lands for the generation of
hydropower by the Grand Coulee Dam, located on the main stem of
the Columbia River in northcentral Washington State. The Tribe
has received compensation in the amount of $4,700 for the loss
of tribal lands taken for the construction of the Dam, an
amount that is inadequate to properly compensate the Tribe for
its losses and that is not comparable to the payments made to
the neighboring Confederated Tribes of the Colville Reservation
for their loss of similar tribal lands for the construction and
operation of the Dam.
Background
PLANNING AND CONSTRUCTION OF GRAND COULEE DAM
Planning for the construction of the Grand Coulee Dam began
during the period from 1927 to 1931, when the Army Corps of
Engineers (ACE), at the direction of Congress, investigated the
Columbia River and its tributaries to identify sites at which
dams could be constructed to produce hydroelectric power at low
cost. The ACE recommended that dams be constructed at a number
of sites, including the current site of the Grand Coulee Dam.
The ACE recommended that construction of Grand Coulee Dam
should be undertaken by local governments or private utilities
under the authority of the Federal Power Act, 16 U.S.C.
Sec. Sec. 791a et seq. Under section 10(e) of that Act, 16
U.S.C. Sec. 803(e), any licensee using Indian lands must pay to
the Indian tribe an annual payment for the use of its land.
n 1933, an agency of the State of Washington was issued a
preliminary permit to construct a dam at the Grand Coulee site
by the Federal Power Commission. Several years later, however,
the Federal government assumed control of the project. Federal
dam projects were not subject to the Federal Power Act.
PAYMENT OF COMPENSATION TO TRIBES
Under the Act of June 29, 1940, Pub. L. No. 76-690
(codified as amended at 16 U.S.C. Sec. Sec. 835d-835h), in aid
of the construction of the Grand Coulee Dam project, Congress
granted to the United States ``all the right, title, and
interest of the Indians in and to the tribal and allotted lands
within the Spokane and Colville Reservations . . . as may be
designated therefor by the Secretary of the Interior from time
to time. . . .'' This Act also provided that the Secretary of
the Interior was to determine the amount of ``just and
equitable compensation for the tribal lands taken.'' Id.,
codified as amended at 16 U.S.C. Sec. 835e.
At the time the Dam project came under Federal
administration, the United States recognized that the Spokane
Tribe and the Confederated Tribes of the Colville Reservation
had compensable interests that would be injured by the project,
including interests in the development of hydropower, in a
salmon fishery vital to the tribes which would be destroyed by
the dam construction, and in tribal lands already identified as
potential hydropower sites that would be inundated as a result
of the construction of the Grand Coulee Dam.
Pursuant to the Secretary of the Interior's determination,
the Spokane Tribe was paid $4,700 in compensation, and the
Confederated Tribes of the Colville Reservation were paid
$63,000 in compensation. The Committee received testimony at
its hearing on October 2, 2003, to the effect that the original
payments made to the tribes were not in fact adequate to
provide them with ``just and equitable compensation'' and were
not comparable to the payments which would have been made had
the Dam been constructed under the authority of the Federal
Power Act.
The Confederated Tribes of the Colville Reservation pursued
additional claims for the loss of their fisheries, and in 1978
settled those claims for about $3,300,000. The Confederated
Tribes also initiated litigation under the Indian Claims
Commission Act of 1946, Pub. L. No. 79-726 (ICCA), and secured
a judicial determination that under the ``fair and honorable
dealings'' standard of the ICCA they could assert a claim for
compensation for the water power values of lost tribal lands
(i.e., a share of hydropower revenues generated by the Dam from
the use of the tribal lands). Confederated Tribes of the
Colville Reservation v. United States, 964 F.2d 1102 (Fed. Cir.
1992). In 1994, Congress ratified an agreement between the
Confederated Tribes of the Colville Reservation and the United
States providing for payment of damages and annual installments
of $15,250,000 in perpetuity, adjusted annually, based on
revenues from the sale of electric power generated by the Grand
Coulee Dam project. Confederated Tribes of the Colville
Reservation Grand Coulee Dam Settlement Act, Pub. L. No. 103-
436, 108 Stat. 4577 (November 2, 1994) (``Confederated Tribes
Act'').
Although the Spokane Tribe litigated certain other issues
under the ICCA, it did not litigate its claims regarding loss
of water power values in that forum or elsewhere. Nevertheless,
legal opinions issued by the Office of the Solicitor of the
Department of the Interior, a Task Force Study conducted from
1976 to 1980 at the direction of the Senate Committee on
Appropriations, and hearings at the time of the enactment of
the Colville Confederated Tribes Act all recognized that the
Spokane Tribe suffered injuries similar in nature to those
suffered by the Colville Confederated Tribes. It was also
recognized that the Spokane Tribe and would have a claim to
compensation that is legally comparable to that of the Colville
Confederated Tribes were it not for the five-year statute of
limitations applicable under the ICCA that the United States
contends bars the Spokane Tribe from bringing a civil action
for damages under that Act or under any other provision of law.
As the General Accounting Office testified before the
Committee:
A reasonable case can be made to settle the Spokane
tribe's case along the lines of the Colville
settlement--a one-time payment from the U.S. Treasury
for past lost payments for water power values and
annual payments primarily from Bonneville. Bonneville
continues to earn revenues from the Spokane reservation
lands used to generate hydropower. However, unlike the
Colville tribes, the Spokane tribe does not benefit
from these revenues. The Spokane tribe does not benefit
because it missed its filing opportunity before the
Indian Claims Commission. At that time it was pursuing
other avenues to win payments for the value of its land
for hydropower. These efforts would ultimately fail.
Without congressional action, it seems unlikely that a
settlement for the Spokane tribe will occur.\1\
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\1\ Testimony of Robert A. Robertson, United States General
Accounting Office, October 2, 2003, before the Senate Committee on
Indian Affairs, at 3, reprinted in S. Hrg. 108-375, at 64.
Testimony was received by the Committee from Tribal
Chairman Warren Seyler indicating that, while the Spokane Tribe
failed to assert its claim in a timely manner, that failure may
be considered excusable because it resulted in part from the
failure of the Bureau of Indian Affairs to carry out its
advisory responsibilities under the ICCA and because the
Commissioner of Indian Affairs hindered the Spokane Tribe in
retaining counsel necessary to fully investigate its potential
claims and to represent the Tribe in asserting its claims under
the ICCA. Accordingly, the Spokane Tribe has not received just
and equitable compensation for its losses relating to the
salmon fishery on which the Tribe was economically dependent,
the inundation of identified hydropower sites that the Tribe
could itself have developed, and the loss for the ongoing
revenue stream the Tribe would have received under the Federal
Power Act if the project had not been put under Federal
administration. The lands lost by the Spokane Tribe were equal
to more than 39% of the Colville tribal lands lost to
construction and operation of the Grand Coulee Dam and
associated reservoir.
SUMMARY OF PROVISIONS OF S. 1438
Under the proposed legislation, the Spokane Tribe would be
compensated for the use of its lands for the production of
hydropower by the Grand Coulee Dam under a formula based in
part on that by which the Confederated Tribes of the Colville
Reservation were compensated in the Confederated Tribes of the
Colville Reservation Grand Coulee Dam Settlement Act, Pub. L.
103-436, 108 Stat. 4577 (November 2, 1994). The Spokane Tribe
lost lands equivalent in areato 39% of the lands lost by the
Colville Confederated Tribes, and a settlement based solely on this
factor would result in payments to the Spokane Tribe equal to 39% of
the payments made to the Confederated Colville Tribes; this percentage
has been reduced to 29%, however, in recognition of the fact that
certain lands located within, as well as contiguous to, the boundaries
of the Spokane Indian Reservation taken for construction of the Grand
Coulee Dam are to be restored to the Spokane Tribe under the terms of
this legislation.
Under S. 1438, an interest-bearing settlement fund account
would be establishment in the Treasury to be known as the
Spokane Tribe of Indians Settlement Fund. Subject to the
availability of appropriations, for fiscal year 2006, the
Secretary would deposit $17,800,000 into the Fund, and for each
of the four fiscal years thereafter, the Secretary would
deposit into the Fund the sum of $12,800,000. These funds would
be held in trust by the Secretary, unless and until the Spokane
Business Council submits a written request to the Secretary
asking that all or part of the Fund be paid to the Spokane
Business Council. In the event such a request is made,
$5,000,000 of the initial deposit would be used for the
planning, design, construction, equipping, and operation and
maintenance of a Cultural Resource Repository and Interpretive
Center to house burial remains, funerary objects, and other
cultural resources affected by the operation of the Grand
Coulee Dam and to provide an educational facility addressing
the culture and history of the Spokane Tribe. Of the remaining
assets of the Fund, 25% would be used by the Spokane Business
Council for discretionary purposes of general benefit to
members of the Spokane Tribe, while 75% would be used by the
Council to carry out resource development, credit, scholarship,
or reserve, investment, and economic development programs.
Additionally, on March 1, 2007, the Administrator of the
Bonneville Power Administration (``Administrator'') would pay
the Spokane Tribe an amount equal to 29% of the annual payment
due to the Colville Confederated Tribes under Sec. 5(b) of the
Colville Confederated Tribes Act for the 2005 and 2006 fiscal
years. On or before March 1 of each year thereafter, the
Administrator would make annual payments to the Tribe equal to
29% of the Colville payment for the previous fiscal year. Upon
payment to the Tribe, these funds could be used or invested by
the Spokane Business Council in the same manner and for the
same purposes as other Spokane Tribe governmental funds.
Expenditure of funds transferred to the Tribe by the
Administrator would not require approval by the Secretary of
the Interior or the Administrator, and these officials would
have no trust responsibility for the investment,
administration, or expenditure of those funds.
The Administrator would be authorized to deduct certain
sums ($2,600,000 in fiscal year 2007 and $1,300,000 each fiscal
year thereafter in which payments are made to the Spokane
Business Council) from the interest otherwise payable to the
Secretary of the Treasury from ``net proceeds'' as defined in
section 13 of the Federal Columbia River Transmission Act, 16
U.S.C. Sec. 838k, subject to certain limitations.
The Secretary of the Interior would be directed to transfer
administrative jurisdiction for certain lands along the shores
of the Columbia River and the Spokane River and its reservoirs,
and located within as well as contiguous to the exterior
boundaries of the Spokane Indian Reservation, to the Bureau of
Indian Affairs. Such lands are to be held in trust for the
Spokane Tribe and to be included within the Spokane Indian
Reservation as those Reservation lands were originally held for
the Tribe, subject to a reservation of rights and easement on
behalf of the United States regarding such use of these lands
as is necessary for the operation of the Columbia Basin Project
and existing recreational facilities owned or permitted by the
United States. The lands would also be subject to the execution
of a memorandum of agreement between the relevant agencies of
the Department of the Interior and the Spokane Tribe to provide
for the coordination of such activities.
The making of the prescribed payments by the Secretary of
the Interior and the Administrator, together with the
restoration of ownership and the taking of the specified land
into trust and added to the Reservation on behalf of the
Spokane Tribe, would constitute full satisfaction of the
Spokane Tribe's claims for past and continued use of tribal
lands and to a fair share of hydropower revenues generated as a
result of the use of those lands.
The bill would authorize the appropriation of such funds as
are necessary to accomplish its purpose.
Explanation of Amendments
The title of S. 1438 has been amended to more properly
reflect the scope of the claims that are to be resolved by this
legislation.
The substitute amendment contains numerous changes from the
bill as introduced. The legislative findings have been
substantially rewritten, and six of the nine definitions are
new.
The amount of the payments to be made into the Spokane
Tribe of Indians Settlement Fund is substantially reduced from
that set forth in the bill as introduced (to a total of
$69,000,000, paid over 5 years), and the amount of annual
payments to be made to the Spokane Tribe is reduced below the
rate originally proposed (now 29% of the analogous payments
made to the Confederated Tribes of the Colville Reservation, a
reduction from 39.4% in the bill as introduced), in recognition
of the restoration of lands, both within the Reservation and
ceded land contiguous to the Reservation, previously taken from
the Spokane Tribe. The provisions of sections 5 and 6 of the
bill as introduced (``Settlement Fund Account'' and ``Use and
Treatment of Settlement Funds,'' respectively) have been
modified and rearranged as sections 5, 6, and 7 (``Settlement
Fund,'' ``Payments by the Administrator,'' and ``Treatment
After Funds are Paid'').
Provisions contained in the substitute amendment regarding
the effect of this legislation on interest payments payable to
the Treasury of the United States by the Bonneville Power
Administration (Section 8, ``Repayment Credit,'' authorizing
the Administrator to deduct certain sums from annual payments
of interest made to the U.S. Treasury) and the transfer from
theBureau of Reclamation to the Bureau of Indian Affairs of
certain lands along the shoreline of the reservoir behind Grand Coulee
Dam to be held in trust for the Spokane Tribe as part of the Spokane
Indian Reservation (Section 9, ``Transfer of Administrative
Jurisdiction,'') are new and were not included in the legislation as
introduced.
Section 7 (``Satisfaction of Claims'') of the original
legislation has been amended and renumbered as section 10.
Legislative History
The Congress considered settlement proposals relating to
the Spokane Tribe's claims in the 106th Congress (S. 1525 and
H.R. 2664) and in the 107th Congress (S. 2567 and H.R. 4859).
In the 108th Congress, S. 1438 was introduced on July 22, 2003,
by Senator Cantwell, for herself and Senators Inouye and
Murray, and was referred to the Committee on Indian Affairs.
Related legislation, H.R. 1753, sponsored by Representative
George Nethercutt and cosponsored by Representatives Norman
Dicks and Dale Kildee, is now pending in the House of
Representatives. The Senate Committee on Indian Affairs held a
hearing on S. 1438 on October 2, 2003, and received testimony
or written statements from Sen. Cantwell, Sen. Murray, Steven
G. Hickok, Deputy Administrator, Bonneville Power
Administration, Warren Seyler, Chairman, Spokane Tribal
Business Council (accompanied by Howard Funke, Esq., Funke and
Work Law Offices, Coeur d' Alene, Idaho, and Charles E. Pace,
President and CEO, Regional Services, Challis, Idaho), and
Robert A. Robinson, Managing Director, Natural Resources and
Environment, General Accounting Office. S. Hrg. 108-375. A
similar hearing on H.R. 1753 was held on the same day before
the Water and Power Subcommittee of the House Resource
Committee.
Committee Recommendation and Tabulation of Vote
The Committee on Indian Affairs, in an open business
session on September 22, 2004, adopted an amendment to the
title and an amendment in the nature of a substitute to S. 1438
by voice vote and ordered the bill, as amended, reported
favorably to the Senate.
Section-by-Section Analysis
Section 1--Short title
Section 1 states that the Act may be cited as the ``Spokane
Tribe of Indians of the Spokane Reservation Grand Coulee Dam
Equitable Compensation Settlement Act.''
Section 2--Findings
Section 2 states that Congress finds that--
(1) From 1927 to 1931, at the direction of Congress, the
Corps of Engineers investigated the Columbia River and its
tributaries to determine sites at which power could be produced
at low cost.
(2) Under section 10(e) of the Federal Power Act (16 U.S.C.
Sec. 803(e)), when licenses are issued involving tribal land
within an Indian reservation, a reasonable annual charge shall
be fixed for the use of the land, subject to the approval of
the Indian tribe having jurisdiction over the land.
(3) In August 1933, the Columbia Basin Commission, an
agency of the State of Washington, received a preliminary
permit from the Federal Power Commission for water power
development at the Grand Coulee site.
(4) Had the Columbia Basin Commission or a private entity
developed the site, the Spokane Tribe would have been entitled
to a reasonable annual charge for the use of the land.
(5) In the mid-1930s, the Federal Government, which is not
subject to the licensing requirements of the Federal Power Act
(16 U.S.C. Sec. 792 et seq.), federalized the Grand Coulee Dam
project and began construction of the Grand Coulee Dam.
(6) When the Grand Coulee Dam project was federalized, the
Federal Government recognized that development of the project
affected the interests of the Spokane Tribe and the
Confederated Tribes of the Colville Reservation and that it
would be appropriate for the Spokane and Colville Tribes to
receive a share of the revenue from the disposition of power
produced at Grand Coulee Dam.
(7) In the Act of June 29, 1940 (16 U.S.C. Sec. 835d et
seq.), Congress granted to the United States, in aid of the
construction, operation, and maintenance of the Columbia River
project, all the right, title, and interest of the Spokane
Tribe and the Colville Tribes in and to tribal and allotted
land within the Spokane and Colville Reservations, as
designated by the Secretary of the Interior from time to time,
and other interests in such land as required and as designated
by the Secretary for certain construction activities undertaken
in connection with the project and provided that compensation
for the land and other interests was to be determined by the
Secretary in such amounts as the Secretary determined to be
just and equitable.
(8) Pursuant to that Act, the Secretary paid $4,700 to the
Spokane Tribe and $63,000 to the Confederated Tribes of the
Colville Reservation.
(9) In 1994, following litigation under the Act of August
13, 1946, commonly known as the Indian Claims Commission Act
(60 Stat. 1049, chapter 959; former 25 U.S.C. Sec. Sec. 70 et
seq.), Congress ratified the Colville Settlement Agreement,
which required a paymentof $53,000,000 for past use of the
Colville Tribes' land and, for continued use of the Colville Tribes'
land, annual payments of $15,250,000, adjusted annually based on
revenues from the sale of electric power from the Grand Coulee Dam
project and transmission of that power to the Bonneville Power
Administration.
(10) The Spokane Tribe, having suffered harm similar to
that suffered by the Colville Tribes, did not file a claim
within the Indian Claims Commission Act's 5-year statute of
limitations.
(11) Neither the Colville Tribes nor the Spokane Tribe
filed claims for compensation for use of their land with the
Claims Commission before August 13, 1951, but both Tribes filed
unrelated land claims prior to August 13, 1951.
(12) In 1976, over objections by the United States, the
Colville Tribes were successful in amending their 1951 Claims
Commission land claims to add their Grand Coulee claim.
(13) The Spokane Tribe had no such claim to amend, having
settled its Claims Commission land claims with the United
States in 1967.
(14) The Spokane Tribe has suffered significant harm from
the construction and operation of Grand Coulee Dam.
(15) Spokane tribal acreage taken by the United States for
the construction of Grand Coulee Dam equaled approximately 39
percent of Colville tribal acreage taken for construction of
the dam.
(16) The payments and land transfers made pursuant to this
Act constitute fair and equitable compensation for the past and
continued use of Spokane tribal land for the production of
hydropower at Grand Coulee Dam.
(17) By vote of the Spokane tribal membership, the Spokane
Tribe has resolved that the payments and land transfers made
pursuant to this Act constitute fair and equitable compensation
for the past and continued use of Spokane Tribal land for the
production of hydropower at Grant Coulee Dam.
Section 3--Purpose
Section 3 states that the purpose of this Act is to provide
fair and equitable compensation to the Spokane Tribe for the
use of its land for the generation of hydropower by the Grand
Coulee Dam.
Section 4--Definitions
Section 4 provides definitions for the terms
``Administrator,'' ``Colville Settlement Agreement,''
``Colville Tribes,'' ``Computed Annual Payment,''
``Confederated Tribes Act,'' ``Fund,'' ``Secretary,'' ``Spokane
Business Council,'' and ``Spokane Tribe.''
Section 5--Settlement fund
Section 5(a) provides for the establishment in the Treasury
of the United States of an interest-bearing trust fund to be
known as the ``Spokane Tribe of Indians Settlement Fund,''
consisting of amounts deposited in the Fund under subsection
(b) and any interest earned on investment of amounts in the
Fund.
Section 5(b) provides that, from amounts made available
under section 11, for fiscal year 2006, the Secretary shall
deposit in the Fund $17,800,000, and for each of the 4 fiscal
years thereafter, the Secretary shall deposit in the Fund
$12,800,000.
Section 5(c) provides that the Fund shall be maintained and
invested by the Secretary in accordance with the Act of June
24, 1938 (25 U.S.C. Sec. 162a).
Section 5(d) provides that at any time after funds are
deposited into the Fund, the Spokane Business Council may
submit to the Secretary written notice of the adoption by the
Spokane Business Council of a resolution requesting that the
Secretary pay all or a portion of the amounts in the Fund to
the Spokane Business Council, and provides further that not
later than 60 days after receipt of such a notice, the
Secretary shall pay the amount requested to the Spokane
Business Council.
Section 5(e) provides that, of the initial deposit under
subsection (b)(1), $5,000,000 shall be used by the Spokane
Business Council for the planning, design, construction,
equipping, and continuing operation and maintenance of a
Cultural Resource Repository and Interpretive Center to house,
preserve, and protect the burial remains, funerary objects, and
other cultural resources affected by the operation of the Grand
Coulee Dam; the funding of these activities does not however
alter or affect any authority, obligation, or responsibility of
the United States under Native American Graves Protection and
Repatriation Act (25 U.S.C. Sec. Sec. 3001 et seq.), the
Archaeological Resources Protection Act (16 U.S.C.
Sec. Sec. 470aa et seq.), the National Historic Preservation
Act (16 U.S.C. Sec. Sec. 470 et seq.), or the National
Environmental Policy Act of 1969 (42 U.S.C. Sec. Sec. 4321 et
seq.). Of all other amounts deposited in the Fund (including
interest generated on these amounts), 25 percent shall be
reserved by the Spokane Business Council and used for
discretionary purposes of general benefit to all members of the
Spokane Tribe, and 75 percent shall be used by the Spokane
Business Council to carry out resource development programs,
credit programs, scholarship programs, or reserve, investment,
and economic development programs.
Section 6--Payments by the Administrator
Section 6(a) provides that on March 1, 2007, the
Administrator shall pay to the Spokane Tribe the amount that is
equal to 29 percent of the Computed Annual Payment for fiscal
year 2005, adjusted to reflect the change in the Consumer Price
Index for all urban consumers published by the Department of
Labor, from the date on which the payment for fiscal year 2005
was made to the Colville Tribes to the date on which payment is
made to the Spokane Tribe under this provision, and the amount
that is equal to 29 percent of the Computed Annual Payment for
fiscal year 2006.
Section 6(b) provides that on or before March 1, 2008, and
March 1 of each year thereafter, the Administrator shall pay to
the Spokane Tribe the amount that is equal to 29 percent of the
Computed Annual Payment for the previous fiscal year.
Section 7--Treatment after funds are paid
Section 7(a) provides that payments made to the Spokane
Business Council of Spokane Tribe under section 5 or 6 may be
used or invested by the Spokane Business Council in the same
manner and for the same purposes as other Spokane Tribe
governmental funds.
Section 7(b) provides that neither the Secretary nor the
Administrator shall have any trust responsibility for the
investment, supervision, administration, or expenditure of any
funds after the date on which the funds are paid to the Spokane
Business Council under section 5 or 6.
Section 7(c) provides that the payments of all funds to the
Spokane Business Council and Spokane Tribe under sections 5 and
6, and the income generated by the funds, shall be treated in
the same manner as payments under section 6 of the Saginaw
Chippewa Indian Tribe of Michigan Distribution of Judgment
Funds Act (100 Stat. 677).
Section 7(d) provides that after the date on which funds
are paid to the Spokane Business Council or Spokane Tribe under
section 5 or 6, the funds shall constitute Spokane Tribe
governmental funds and shall be subject to an annual tribal
government audit.
Section 8--Repayment credit
Section 8(a) provides that Administrator shall deduct from
the interest payable to the Secretary of the Treasury from net
payments (as defined in section 13 of the Federal Columbia
River Transmission System Act (16 U.S.C. Sec. 838k)) $2,600,000
in fiscal year 2007 and $1,300,000 in each subsequent fiscal
year in which the Administrator makes a payment under section
6.
Section 8(b)(1) provides that except as provided in
paragraphs 8(b)(2) and 8(b)(3), each deduction made under this
section shall be a credit to the interest payments otherwise
payable by the Administrator to the Secretary of the Treasury
during the fiscal year in which the deduction is made and shall
be allocated pro rata to all interest payments on debt
associated with the generation function of the Federal Columbia
River Power System that are due on debt asssociated with the
generation function shall be allocated pro rata to all other
interest payments due during the fiscal year. Section 8(b)(2)
provides that if, in any fiscal year, the deduction is greater
than the amount of interest due on debt associated with the
generation function for the fiscal year, the amount of the
deduction that exceeds the interest due on debt associated with
the generation function shall be allocated pro rata to all
other interesst payments due during the fiscal year. Section
8(b)(3) provides that to the extent that a deduction exceeds
the total amount of interest described in paragraphs (1) and
(2), the deduction shall be applied as a credit against any
other payments that the Administrator makes to the Secretary of
the Treasury.
Section 9--Transfer of administrative jurisdiction
Subsection 9(a) provides that the Secretary of the Interior
shall transfer administrative jurisdiction from the Bureau of
Reclamation to the Bureau of Indian Affairs over all land
acquired by the United States under the Act of June 29, 1940
(16 U.S.C. Sec. 835d), that is located within the exterior
boundaries of the Spokane Indian Reservation established
pursuant to the Executive Order of January 18, 1881, and all
land on the south bank of the Spokane River that extends
westerly from Little Falls Dam to the confluence of the Spokane
River and the Columbia River and that is located at or below
contour elevation 1290 feet above sea level.
Subsection 9(b) provides that all land transferred under
this section shall be held in trust for the benefit and use of
the Spokane Tribe and shall become part of the Spokane Indian
Reservation.
Subsection 9(c) provides that the United States reserves a
perpetual right, power, privilege, and easement over the land
transferred under this section to carry out the Columbia Basin
Project under the Columbia Basin Project Act (16 U.S.C.
Sec. Sec. 835 bet seq.), further including the right to
operate, maintain, repair, and replace boat ramps, docks, and
other recreational facilities owned or permitted by the United
States and existing on the date of enactment of this Act, and
further providing that the cognizant agencies of the Department
of the Interior shall enter into a memorandum of understanding
with the Spokane Tribe to provide for coordination in applying
this subsection.
Section 10--Satisfaction of claims
Section 10 provides that payment by the Secretary under
section 5 and the Administrator under section 6 and transfer of
administrative jurisdiction and restoration of ownership of
land in trust and added to the Reservation under section 9
constitute full satisfaction of the claim of the Spokane Tribe
to a fair share of the annual hydropower revenues generated by
the Grand Coulee Dam project for the past and continued use of
the land of the Spokane Tribe for the production of hydropower
at Grand Coulee Dam.
Section 11--Authorization of appropriations
Section 11 authorizes the appropriation of such funds as
are necessary to carry out this Act.
Cost and Budgetary Considerations
The cost estimate for S. 1438, as amended, as provided by
the Congressional Budget Office, is set forth below:
U.S. Congress,
Congressional Budget Office,
Washington, DC, October 7, 2004.
Hon. Ben Nighthorse Campbell,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared to the enclosed cost estimate for S. 1438, the Spokane
Tribe of Indians of the Spokane Reservation Grand Coulee Dam
Equitable Compensation Settlement Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Mike Waters.
Sincerely,
Elizabeth M. Robinson
(For Douglas Holtz-Eakin, Director).
Enclosure.
S. 1438--Spokane Tribe of Indians of the Spokane Reservation Grand
Coulee Dam Equitable Compensation Settlement Act
Summary: S. 1438 would establish and authorize funds to be
appropriated to the Spokane Tribe of Indians Settlement Fund
(``the Fund'') to compensate the Spokane Tribe of Indians for
the use of its land by the Grand Coulee Dam project in
Washington. Starting in 2007, the bill would require the
Bonneville Power Administration (BPA) to make annual payments
to the tribe from receipts generated from the sale of
electricity. Those payments of the tribe would be offset by
increases in the rates charged to BPA's customers for
electricity sales, and thus would result in no net cost to the
government. Under the bill, BPA would be relieved from making
certain interest payments to the Treasury for funds borrowed on
BPA's behalf. CBO estimates that provision would reduce
receipts collected by BPA by $12 million over the 2007-2014
period, and by $1.3 million a year after 2014. (Those effects
constitute an increase in direct spending.)
Assuming appropriation of the necessary amounts, CBO
estimates that implementing the bill would add $56 million to
discretionary costs over the 2005-2009 period to fund the
Spokane Tribe of Indians Settlement Fund, and an additional $13
million in 2010. S. 1438 contains no intergovernmental or
private-sector mandates as defined in the Unfunded Mandates
Reform Act (UMRA). The payments authorized by this bill would
benefit the Spokane Tribe.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 1438 is shown in the following table.
The costs of this legislation fall within budget functions 450
(community and regional development) and 270 (energy).
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By fiscal year, in millions of dollars--
---------------------------------------------------------------------
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
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CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Payments to Spokane Tribe Settlement Fund
Account:
Authorization Level................... 0 18 13 13 13 13 0 0 0 0
Estimated Outlays..................... 0 18 13 13 13 13 0 0 0 0
CHANGES IN DIRECT SPENDING
Interest Credits for BPA:
Budget Authority...................... 0 0 3 1 1 1 1 1 1 1
Estimated Outlays..................... 0 0 3 1 1 1 1 1 1 1
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Basis of estimate: For this estimate, CBO assumes that the
bill will be enacted early in fiscal year 2005 and that the
authorized amounts will be appropriated for each year.
Spending subject to appropriation
This bill would authorize payments to the Spokane Tribe as
compensation for land taken to build the Grand Coulee Dam. The
bill would authorize the appropriation of $18 million in 2006
and $13 million annually over the 2007-2010 period to a new
tribal trust fund. Thus, CBO estimates that implementing the
bill would cost $18 million in 2006 and $69 million over the
2006-2010 period.
Payments to certain trust funds that are held and managed
in a fiduciary capacity by the federal government on behalf of
Indian tribes are treated as payments to a nonfederal entity.
As a result, CBO expects that the entire amount deposited to
the fund in any year would be recorded as budget authority and
outlays in that year. Because the trust funds would be
nonbudgetary, the subsequent use of such funds by the tribe
would not affect federal outlays.
Direct spending
S. 1436 would require BPA to make annual payments to the
Spokane Tribe. Under the bill such payments would be made for
many decades--as long as electricity is generated at the Grand
Coulee Dam and sold by BPA. Under the bill this payment would
be 29 percent of the annual payment BPA currently makes to the
Colville Tribe. Such payments would begin in 2007 and would
total about $5 million per year, except in 2007 when BPA would
be required to make two payments. BPA is a cost-recovery agency
that charges its customers for electricity. Because it is
scheduled to change its rates in 2007, this payment to the
tribe would become part of BPA's cost structure and would be
offset by an increase in the new electricity rates that the
agency plans to impose in 2007. Thus, this annual payment to
the tribe would result in no net cost to the government.
The bill also would allow BPA reduce the amount of interest
costs that it transfers to the U.S. Treasury for funds borrowed
to construct BPA's infrastructure. The bill would authorize BPA
to forgo interest payments of $2.6 million in 2007, and $1.3
million each year thereafter for many decades--as long as
electricity is generated at the Grand Coulee Dam and sold by
BPA. As a cost-recovery agency, BPA would reduce it's annual
collections from electricity rate payers by the amount of these
forgone interest payments. Thus, CBO estimates that BPA
collections, which are recorded in the budget as offsetting
receipts, would be reduced by $2.6 million in 2007 and about
$12 million over the 2007-2014 period.
Intergovernmental and private-sector impact: S. 1438
contains no intergovernmental or private-sector mandates as
defined in UMRA. The payments authorized by this bill would
benefit the Spokane Tribe.
Estimate prepared by: Federal Costs: Lisa Cash Driskill and
Mike Waters. Impact on State, Local, and Tribal Governments:
Marjorie Miller. Impact on the Private Sector: Selena Caldera.
Estimate approved by: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.
Executive Communications
The Committee has not received any communications from the
Executive Branch regarding S. 1438.
Regulatory and Paperwork Impact
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 bill. The Committee finds that the regulatory
and paperwork impact of S. 1438, as amended, should be minimal.
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 forth in the accompanying
Committee report.
The Administrator of the Bonneville Power Administration
currently makes annual interest payments to the Secretary of
the Treasury from ``net payments'' as defined in section 13 of
the Federal Columbia River Transmission System Act (16 U.S.C.
Sec. 838k). Section 8 of S. 1438 provides that the
Administrator shall deduct $2,600,000 from those payments in
Fiscal Year 2007 and shall deduct $1,300,000 from those
payments in each subsequent fiscal year in which a payment is
made to the Spokane Tribe pursuant to section 6 of S. 1438.