Indian Programs: Tribal Priority Allocations Do Not Target the Neediest
Tribes (Letter Report, 07/17/98, GAO/RCED-98-181).

Pursuant to a congressional request, GAO provided information on the:
(1) Bureau of Indian Affairs' (BIA) method for distributing Tribal
Priority Allocation (TPA) funds; and (2) other revenues available to the
tribes.

GAO noted that: (1) under the current method for distributing TPA funds,
there is no assurance that the funds are effectively targeting the most
pressing needs among the tribes; (2) currently, BIA distributes
two-thirds of TPA funds, referred to as base funds, largely on the basis
of historical funding levels; (3) in distributing these base funds, BIA
does not take into consideration changing conditions, such as the
tribes' levels of need or the tribes' own revenues from nongovernmental
sources; (4) the remaining one-third of TPA funds, known as non-base
funds, are used for such activities as road maintenance and housing
improvement and are generally distributed on the basis of specific
program criteria; (5) BIA's distribution of TPA base funds has been
widely criticized over the last 20 years for, among other things, not
being responsive to changes in the relative needs of the tribes; (6)
furthermore, because the tribes' own revenues are not considered in the
distribution of TPA base funds, the tribes with the highest revenues
receive TPA base funds just as the tribes with the lowest revenues do;
(7) GAO's analysis showed that each of the 6 tribes with the highest
reported revenues received more TPA base funds than did each of the 16
tribes with no reported revenues or with losses; (8) in addition, 62
small tribes reported having revenues of their own yet received the same
amount of TPA base funds as small tribes that reported no revenues of
their own; (9) a decision about whether and in what way to redistribute
TPA funds is as complex as it is controversial; (10) as long as BIA
continues to distribute TPA base funds on a historical basis, it cannot
be certain that the distribution accommodates the changing needs of the
tribes; (11) to determine an equitable distribution among the tribes,
several types of data may be considered, however, much of this
information is not currently or readily available in a consistent and
reliable form; (12) furthermore, questions of equity in federal
financial assistance extend beyond BIA and TPA funds; (13) although TPA
was nearly half of BIA's 1998 appropriation, it represented just 10
percent of the $7.5 billion in federal funding appropriated for Indian
programs in 1998; and (14) ultimately, however, the issues of how TPA
and other federal funds should be distributed and what information
should be considered in that process are policy questions for Congress
and other federal decisionmakers to address.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-98-181
     TITLE:  Indian Programs: Tribal Priority Allocations Do Not Target 
             the Neediest Tribes
      DATE:  07/17/98
   SUBJECT:  Native Americans
             Funds management
             Indian lands
             Indian affairs legislation
             Financial analysis
             Prioritizing

             
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Cover
================================================================ COVER


Report to Congressional Requesters

July 1998

INDIAN PROGRAMS - TRIBAL PRIORITY
ALLOCATIONS DO NOT TARGET THE
NEEDIEST TRIBES

GAO/RCED-98-181

BIA's Distribution of TPA Funds

(141134)


Abbreviations
=============================================================== ABBREV

  BIA - Bureau of Indian Affairs
  DOI - Department of the Interior
  HHS - Department of Health and Human Services
  TPA - Tribal Priority Allocations

Letter
=============================================================== LETTER


B-279789

July 17, 1998

The Honorable Ted Stevens
Chairman, Committee on Appropriations
United States Senate

The Honorable Slade Gorton
Chairman, Subcommittee on Interior
 and Related Agencies
Committee on Appropriations
United States Senate

In recent years, media reports have highlighted Indian tribes that
have garnered considerable wealth through gaming operations and other
businesses.  Accordingly, the Senate Committee on Appropriations
commented, in its report on the Department of the Interior's (DOI)
1998 appropriation bill, that the tribes with substantial revenues of
their own, such as business income, should become more
self-sufficient.  In the Committee's opinion, the Tribal Priority
Allocations (TPA) distributed by the Department's Bureau of Indian
Affairs (BIA) should be targeted at the most economically needy
tribes.  TPA funds are used to provide basic tribal services, such as
law enforcement, social services, adult vocational training, child
welfare, and natural resources management.  TPA made up the largest
portion of BIA's direct appropriation in fiscal year 1998,
representing 45 percent--or $757 million--of the $1.7 billion total. 

Concerned about possible inequities in the distribution of TPA funds,
you asked us to report on BIA's method for distributing these funds
and on the other (i.e., nongovernmental) revenues available to the
tribes.  We presented our preliminary results in April 1998, in
testimony before the Subcommittee on Interior and Related Agencies,
Senate Committee on Appropriations.\1 This report contains our final
analyses of (1) BIA's method for distributing TPA funds and (2)
additional information that could be useful in distributing TPA
funds.  We also provide, in appendixes I and II, our per capita
analyses of TPA distributions, as requested by your offices. 
Specifically, appendix I provides a BIA-wide summary, by area office,
of TPA distributions per capita; appendix II provides more detailed
per capita information. 


--------------------
\1 Indian Issues:  BIA's Distribution of Tribal Priority Allocations
(GAO/T-RCED-98-168, Apr.  21, 1998). 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

Under the current method for distributing TPA funds, there is no
assurance that the funds are effectively targeting the most pressing
needs among the tribes.  Currently, BIA distributes two-thirds of TPA
funds, referred to as "base funds," largely on the basis of
historical funding levels.  In distributing these base funds, BIA
does not take into consideration changing conditions, such as the
tribes' levels of need or the tribes' own revenues from
nongovernmental sources, such as business income.  The remaining
one-third of TPA funds, known as "non-base funds," are used for such
activities as road maintenance and housing improvement and are
generally distributed on the basis of specific program criteria. 
BIA's distribution of TPA base funds has been widely criticized over
the last 20 years for, among other things, not being responsive to
changes in the relative needs of the tribes.  Furthermore, because
the tribes' own revenues are not considered in the distribution of
TPA base funds, the tribes with the highest revenues receive TPA base
funds just as the tribes with the lowest revenues do.  Our analysis
showed that each of the 6 tribes with the highest reported revenues
received more TPA base funds than did each of 16 tribes with no
reported revenues or with losses.  In addition, 62 small tribes
reported having revenues of their own yet received the same amount of
TPA base funds as small tribes that reported no revenues of their
own. 

A decision about whether and in what way to redistribute TPA funds is
as complex as it is controversial.  As long as BIA continues to
distribute TPA base funds on a historical basis, it cannot be certain
that the distribution accommodates the changing needs of the tribes. 
To determine an equitable distribution among the tribes, several
types of data may be considered, such as (1) the economic status of
each tribe, (2) the needs of each tribe, and (3) the government's
responsibility to each tribe.  However, much of this information is
not currently or readily available in a consistent and reliable form. 
Furthermore, questions of equity in federal financial assistance
extend beyond BIA and beyond TPA funds.  Although TPA was nearly half
of BIA's 1998 appropriation, it represented just 10 percent of the
$7.5 billion in federal funding appropriated for Indian programs in
1998.  Ultimately, however, the issues of how TPA and other federal
funds should be distributed and what information should be considered
in that process are policy questions for the Congress and other
federal decisionmakers to address. 


   BACKGROUND
------------------------------------------------------------ Letter :2

In the early 1970s, BIA began giving the tribes more training,
involvement, and influence in the process of allocating TPA funds.\2
TPA funds are used for programs such as law enforcement, social
services, adult vocational training, child welfare, and natural
resource management.  Most tribes have placed all their available TPA
base funding in only 5 or 6 of the more than 30 TPA base fund
programs.  All federally recognized tribes are eligible to receive
TPA funds--either through contracts for operating tribal programs or
through BIA-provided programs.  As of October 1997, 556 tribes had
been recognized by the federal government. 

The Joint Tribal/BIA/DOI Advisory Task Force on Bureau of Indian
Affairs Reorganization, which was created in 1990 to develop goals
and plans for reorganizing BIA to strengthen its administration of
Indian programs, recommended that all small tribes--those with
service populations of 1,500 or less--be brought up to a minimum
level of TPA base funding to allow them the opportunity to develop
basic self-governance capability.\3 The task force recommended that
the small tribes in the lower 48 states have available at least
$160,000 in TPA base funds and that the tribes in the state of Alaska
have available $200,000.  BIA identified 307 tribes as part of this
"small tribes funding initiative" that were below the recommended
minimum funding levels.  As directed by the Congress, BIA used part
of its appropriation for fiscal years 1995, 1997, and 1998 to raise
all the small tribes up to $160,000 in available TPA base funding. 
About two-thirds of the tribes included in the funding initiative are
located in Alaska, and, for fiscal year 1999, BIA has requested an
additional $3 million to move them closer to the recommended $200,000
funding level. 

The Single Audit Act of 1984, as amended, requires reporting by
nonfederal entities, including tribes, that meet certain federal
assistance thresholds.  Before fiscal year 1997, the threshold was
the annual receipt of $100,000 or more in federal funds; in fiscal
year 1997, the threshold became the annual expenditure of $300,000 or
more in federal funds.  Entities meeting the threshold must submit an
audited financial statement and a schedule of federal financial
assistance. 


--------------------
\2 Over the years, BIA has referred to this process as "band
analysis," the "Indian Priority System," and "TPA." For consistency
throughout this report, we refer to the process as TPA.  See Tribal
Participation in the Bureau of Indian Affairs Budget System Should Be
Increased (GAO/CED-78-62, Feb.  15, 1978) and Indian Programs: 
Tribal Influence in Formulating Budget Priorities Is Limited
(GAO/RCED-91-20, Feb.  7, 1991). 

\3 The Tribal Budget System:  Preliminary Assessment of Most Needy
Small Tribes, Joint Tribal/BIA/DOI Advisory Task Force on Bureau of
Indian Affairs Reorganization (Apr.  1994). 


   HISTORICAL FUNDING LEVELS DRIVE
   THE DISTRIBUTION OF TPA BASE
   FUNDS
------------------------------------------------------------ Letter :3

Of the $757 million appropriated for TPA in fiscal year 1998, about
$507 million was for base funding, and about $250 million was for
non-base funding.  BIA distributes TPA base funds primarily on the
basis of historical distribution levels.  That is, the amount
available to a particular tribe is generally the same as last year's
amount, without considering tribal needs or the tribes' own revenues. 
Depending on annual appropriation levels, increases or decreases to a
tribe's base fund amount are made on a pro rata basis (e.g., a tribe
that receives 0.2 percent of the total TPA base fund amount would
receive 0.2 percent of any increase or decrease).  In contrast,
non-base TPA funds are distributed according to specific program
criteria and, in some cases, the income levels of individual tribal
members.  BIA's distribution of TPA base funds has been criticized
over the last 20 years for, among other things, not being responsive
to changes in the relative needs of the tribes.  Nor has the
distribution of TPA base funds been responsive to changes in the
relative levels of the tribes' own revenues.\4


--------------------
\4 A tribe's "own revenues" refers to all nongovernmental revenues
available to a tribe for its discretionary use.  That is, these
revenues include net profits from business enterprises such as gaming
operations, hotels, and restaurants.  They also include such things
as tribally imposed taxes, interest on investments, rental and lease
income, and trust funds.  They exclude financial assistance from
federal, state, and local governments and from private foundations. 


      BIA'S DISTRIBUTION OF TPA
      FUNDS
---------------------------------------------------------- Letter :3.1

The majority of the fiscal year 1998 TPA base funds was distributed
on the basis of historical funding levels, as has been the case for
decades.  The funding process used today has remained essentially the
same since the early 1970s, when BIA began allowing the tribes more
input into budget decisions and priorities.  TPA was created to
further Indian self-determination by giving the tribes the
opportunity to establish their own priorities and to move funds among
programs accordingly, in consultation with BIA.  BIA believes that a
stable funding base enhances the tribes' ability to plan and budget
their funds. 

Once a program is categorized as part of the TPA base funds, it loses
any need-based identity it once had.  Prior to their inclusion in
TPA, some programs were funded according to specific program
criteria.  For example, funds provided under the Johnson O'Malley Act
of 1934, as amended, are intended to provide supplementary financial
assistance to meet the educational needs of Indian children attending
public schools.  These funds used to be distributed on the basis of
education costs in each state and the number of students eligible for
program services.  Beginning in 1996, however, Johnson O'Malley funds
were transferred into the tribes' TPA base funds, using 1995 data on
program costs and eligibility.  Because both cost and eligibility may
have changed since 1995, and because the tribes have the authority to
move funds in and out of the program, the current distribution may
bear little resemblance to the original, formula-driven one. 

In contrast to the base funds, the non-base funds--used for such
programs as road maintenance, housing improvement, welfare
assistance, and contract support--are generally distributed according
to specific program criteria that consider, in some cases, individual
income.  Eligibility for housing improvement funds, for example, is
based on whether and to what degree the housing being considered for
improvement is substandard, as well as on the applicant's income
level.  Similarly, eligibility for welfare assistance is based on a
determination that an individual's income is insufficient to meet his
or her essential needs.  In general, the tribes may not shift
non-base funds among programs without special authorization. 


      BIA'S DISTRIBUTION OF TPA
      BASE FUNDS HAS BEEN
      CRITICIZED IN THE PAST
---------------------------------------------------------- Letter :3.2

BIA's process for allocating base funds, while enhancing the tribes'
budget flexibility, has been criticized for, among other things, not
being responsive to changes in the relative needs of the tribes. 
Although the tribes set priorities for their individual programs, no
mechanism exists within TPA for identifying the tribes' comparative
needs and funding them accordingly.  As the relative needs of the
tribes have changed over time, no corresponding change has occurred
in the distribution of TPA base funds, making the apparent funding
discrepancies among the tribes more pronounced. 

In 1978, we reported that BIA had been criticized by the Office of
Management and Budget, the American Indian Policy Review Commission,
and the tribes for its failure to develop a formula to ensure the
equitable allocation of TPA funds among the tribes on the basis of
need.\5 We reiterate our belief, as stated in our 1978 report, that
"accurate, current, and comparable comprehensive tribal needs
analyses would provide BIA with a measurement to be considered in
developing a formula on which to allocate Bureau [TPA] funds."

In August 1994, the Joint Tribal/BIA/DOI Advisory Task Force on
Bureau of Indian Affairs Reorganization--charged with developing
plans for the reorganization of BIA--recommended that BIA develop a
method for measuring the relative needs of each tribe for each BIA
program.  The task force envisioned that these standard assessment
measures would be a cornerstone of an equitable distribution of TPA
funds.  At the same time, the task force noted the following: 

     "Developing a system to measure the relative needs of Tribes
     with widely varying locations, mix of programs, size, and
     circumstances will be a monumental undertaking.  The development
     will rely heavily on information which can be gathered only
     through a Tribal/BIA partnership.  Much of this information is
     not currently available in a consistent and reliable form."\6

Finally, in 1998, a task force--established pursuant to Interior's
1998 appropriation bill and charged with deciding how to distribute a
general increase in 1998 TPA funds--emphasized the importance of
BIA's developing a TPA funding allocation method that addressed
funding inequities and unmet tribal needs.  This task force
recommended in its January 1998 report that funds be set aside to
create a working group to develop a standard assessment methodology. 
Accordingly, BIA set aside $250,000 for this purpose.  The working
group, according to BIA's fiscal year 1999 budget request, will
develop a revised TPA allocation model that is based on tribal needs. 
BIA has requested an additional $250,000 for the working group in
fiscal year 1999. 

As long as it continues to use a funding distribution method that is
relatively static, based largely on the initial division of funds
among the tribes that was developed in the early 1970s, BIA has no
assurance that its current TPA distribution is most effectively
meeting the needs of the tribes.  According to Interior officials,
there is no clear documentation on how TPA base amounts for each
tribe were initially determined.  And even if those initial divisions
were clearly documented, they may not support a distribution made in
the early 1970s as the appropriate distribution today.  At least two
significant changes have occurred in the last 25 years that affect
Indian tribes:  The Indian population has more than doubled in size,
and the revenues of some tribes have greatly increased since the
approval of Indian gaming in 1988.  In 1995, net income from Indian
gaming operations was about $1.9 billion.\7


--------------------
\5 Tribal Participation in the Bureau of Indian Affairs Budget System
Should Be Increased (GAO/CED-78-62, Feb.  15, 1978). 

\6 Report of the Joint Tribal/BIA/DOI Advisory Task Force on
Reorganization of the Bureau of Indian Affairs, BIA (Aug.  1994). 

\7 Tax Policy:  A Profile of the Indian Gaming Industry
(GAO/GGD-97-91, May 5, 1997). 


      TRIBES' OWN REVENUES NOT A
      FACTOR IN DISTRIBUTING TPA
      BASE FUNDS
---------------------------------------------------------- Letter :3.3

Because the tribes' own revenues are not considered in distributing
TPA base funds, rich and poor tribes alike receive them.  In fact,
the tribes in our analysis that reported the highest amounts of their
own revenues received more in TPA base funds, in total, than did
those tribes that reported the lowest amounts of their own
revenues.\8 Furthermore, all the tribes covered by the small tribes
funding initiative were brought up to about the same level of
available TPA base funding, even though some reported substantial
revenues of their own. 

Of the 299 tribes included in our analysis,\9 one reported having
more than $300 million in revenues of its own in 1996.  Yet that same
year, this tribe received over $350,000 in TPA base funds. 
Similarly, the five other tribes that reported more than $100 million
in revenues of their own in 1995 or 1996 received TPA base amounts
ranging from about $500,000 to $40 million in the corresponding year. 
In contrast, three of the six tribes that reported a deficit in their
own revenues each received less than $350,000 in TPA base funds. 

Similarly, for the small tribes identified by BIA as being part of
the small tribes funding initiative, the tribes' own revenues did not
affect the TPA base funds they received.  Specifically, 72 of these
tribes included in our analysis reported revenues that ranged from
minus $1.4 million to over $30 million, with a median of about
$92,000.  Of the 72 tribes, 62 reported having revenues of their own,
and 10 reported having no revenues or having losses.  The small
tribes that reported no revenues of their own and the one that
reported having over $30 million in revenues, along with all the
other tribes in the small tribes funding initiative whose revenues
fell in between, were brought up to the same minimum
level--$160,000--of available TPA base funding in 1998, at
congressional direction. 

BIA stated that "there are a number of statutes which specifically
prohibit BIA from considering certain [tribal] revenue sources when
making funding allocations." BIA also said that comparing one tribe's
own revenues and TPA funding with those of another tribe is an
"unfair comparison" because it does not take into consideration many
other factors that may affect the level of TPA funding, such as a
tribe's land base and population.  We agree that BIA is prohibited
from considering certain tribal revenues in making funding
allocations.  The comparisons we present among tribes--regarding
their own revenues and their TPA funding--are intended to illustrate
the point that tribal revenues are currently not considered in the
distribution of TPA funds.  We agree that many other factors should
be considered in determining an appropriate TPA distribution method. 


--------------------
\8 As discussed in more detail later, the nongovernmental income
information tribes report under the Single Audit Act is not complete
or reliable in all cases. 

\9 We examined all 326 Single Audit Act financial statements on file
with DOI that were the most recently submitted by the tribes and
various related entities.  Of the 326 statements, 299 were for
tribes.  Thirteen of the remaining statements were for tribal
businesses or components of tribes, and we included the information
in those statements with the information for the respective tribes. 
The remaining 14 statements were for consortia or associations
representing multiple tribes, primarily in Alaska; we did not include
the information from these statements in our analysis of the tribes'
revenues.  The statements generally covered 1995 or 1996. 


   ADDITIONAL INFORMATION THAT
   COULD BE USEFUL IN DISTRIBUTING
   TPA FUNDS IS NOT READILY
   AVAILABLE
------------------------------------------------------------ Letter :4

The question of how to ensure equity in the distribution of TPA funds
among tribes is not an easy one.  Among the key pieces of information
that could prove useful in answering that question are (1) the
economic status of each tribe, (2) its needs, and (3) the
government's responsibility to it.  Much of this information,
however, is not currently or readily available.  Furthermore, the
question of how to ensure equity in funding goes beyond TPA funds; it
pertains as well to funding for many Indian programs provided by
federal agencies other than BIA.  Ultimately, however, the issues of
how TPA and other federal funds are distributed and what information
should be considered in that process are policy questions for the
Congress and other federal decisionmakers to decide. 

To obtain an understanding of the economic status of each tribe,
complete and reliable information on its finances would be needed. 
Like all nonfederal entities that expend at least $300,000 annually
in federal funds, tribes must file financial reports under the Single
Audit Act to account for the expenditure of those funds.  Although
the purpose of the Single Audit Act is to safeguard federal funds,
not to require complete financial reporting by Indian tribes, the
financial information submitted by the tribes under the act is the
information most readily available from the majority of tribes.  Our
analysis of that information showed that tribes reported widely
varying amounts of their own revenues.  Specifically, six tribes each
reported that they had revenues of over $100 million, for a total of
over $1.1 billion; at the other extreme, six tribes reported losses
that totaled over $9 million.  Another 128 tribes reported revenues
of between $1 million and $100 million, totaling almost $1.6 billion,
and 159 tribes reported that they had from $0 up to $1 million of
their own revenues, totaling over $36 million. 

However, the information reported by the tribes under the Single
Audit Act does not always provide a complete picture of the tribes'
financial positions and, in some cases, is not reliable.  Our
examination of tribal financial statements filed under the act showed
that the tribes frequently excluded financial information on business
enterprises that do not involve the expenditure of federal funds. 
For example, in a previous review of Indian gaming revenues,\10 we
identified a tribe that reported over $100 million in net income from
its gaming operations in 1995; yet the tribe's financial statement
for the same year (submitted under the Single Audit Act) reported
only about $1.3 million in revenues of its own.  Furthermore, the
reliability of the data contained in the financial statements we
reviewed was, in some cases, questionable.  About half of these
financial statements received auditors' opinions indicating that the
statement was deficient in some way and did not fairly represent the
financial position of the reporting entity.  Deficiencies ranged from
the use of a cost rather than an accrual basis of accounting for
revenues and expenditures to the complete unreliability of the data
the tribe used for its accounting system.  Deficiencies commonly
cited included the exclusion of proprietary funds and of the general
fixed asset account group. 

In addition, not all tribes are required to report under the Single
Audit Act.  Prior to fiscal year 1997, only those nonfederal entities
(including Indian tribes) that received $100,000 or more in total
federal assistance were subject to the reporting requirements in the
Single Audit Act.  Beginning in fiscal year 1997, the reporting
requirement threshold under the Single Audit Act was increased to the
expenditure of at least $300,000 in total federal assistance
annually.  In addition, tribes that rely on the federal government or
some other entity to provide services for them, rather than expending
the funds themselves, are not subject to the Single Audit Act. 

A second key piece of information that could prove useful in
answering the question of how to ensure equity in the distribution of
TPA funds is information on tribes' needs.  Over the last 20 years,
we and others have commented that BIA should develop measurements of
the relative needs of each tribe for each BIA program.  This
recommendation was repeated in January 1998 by a joint BIA/tribal
task force.  An assessment of a tribe's needs is crucial to
determining the extent to which a tribe's own revenues foster its
self-sufficiency.  In and of themselves, a tribe's financial
resources do not serve as a measure of its needs.  For example, one
tribe in our analysis, which reported having more than $100 million
of its own revenues in 1996, also reported receiving over $300
million in federal assistance that year.  Although the receipt of
such a large amount of federal assistance might indicate that the
tribe's needs far exceed its own revenues, many other factors could
negate or support such a conclusion. 

Among the many factors that may come into play in assessing need are
the size and composition of a tribe's population and land base, the
type and extent of its natural resources and governance experience,
as well as various program-specific criteria.  As reported in 1994 by
the Joint Tribal/BIA/DOI Task Force, gathering the information
necessary to assess tribes' needs would be a "monumental
undertaking." There are over 550 federally recognized tribes located
throughout the United States.  Their reported populations range from
0 to over 225,000, and their reservations vary in size from a few
acres for some rancherias in California to 17.5 million acres for the
Navajo reservation in Arizona, New Mexico, and Utah. 

And finally, to obtain an understanding of the federal government's
responsibility to each tribe, the provisions of applicable treaties,
laws, executive orders, and court decisions would need to be
reviewed.  There are over 360 ratified Indian treaties, dating back
to 1778, as well as hundreds of relevant executive orders, court
decisions, and laws. 

In developing Interior's appropriations for fiscal year 1998, the
Senate Committee on Appropriations inserted a provision that would
have required BIA to develop a formula to allocate TPA funds on the
basis of need, taking into account the tribes' own revenues.  The
provision also would have required the tribes to report their
complete financial information to BIA as a precondition of receiving
TPA funding.  Much of the debate over this provision focused on
whether the federal government had an overriding legal responsibility
to provide TPA funding regardless of the tribes' own revenues. 
Although this provision was not retained in the final version of the
bill approved by the Senate, or in the version enacted, we expect
that questions regarding BIA's distribution of TPA funds will
continue.  Whether comprehensive financial reporting should be
required for the tribes and how that information should be used in
determining the distribution of TPA funds are policy questions for
the Congress and other federal decisionmakers to address. 

Furthermore, our review addressed only the distribution of TPA
funding, which is just a small part of the overall federal funding
for Indian programs.  Although TPA was nearly half of BIA's 1998
appropriation, it represented just 10 percent of the $7.5 billion in
federal funding appropriated for Indian programs in 1998.  Such
funding comes from various federal agencies:  the Department of
Health and Human Services (HHS), which provides funding for Indian
health programs, accounted for about 37 percent of the federal
funding for Indian programs; DOI (including BIA), about 26 percent;
the Department of Education, which provides funding for Indian
education programs, about 18 percent; the Department of Housing and
Urban Development, which provides funding for Indian housing
programs, about 9 percent; and other agencies, the remaining 10
percent. 

Given the extent and the amount of federal funding, it is clear that
the question of whether federal funds target the greatest needs among
tribes extends beyond TPA and BIA; the question of equity might also
be asked about funds provided by other federal agencies.  In our
analysis, for example, the tribe with the most revenues of its own
received more than twice as much funding from HHS as it did from BIA. 
In several previous reviews, we have questioned whether HHS' funding
distributions are appropriate.\11


--------------------
\10 Tax Policy:  A Profile of the Indian Gaming Industry
(GAO/GGD-97-91, May 5, 1997).  The Indian Gaming Regulatory Act of
1988 requires that tribes annually submit, to the National Indian
Gaming Commission, audited financial statements on their tribal
gaming operations. 

\11 Indian Health Service Not Yet Distributing Funds Equitably Among
Tribes (GAO/HRD-82-54, July 2, 1982); Indian Health Service:  Funding
Based on Historical Patterns, Not Need (GAO/HRD-91-5, Feb.  21,
1991); Indian Health Service:  Basic Services Mostly Available;
Substance Abuse Problems Need Attention (GAO/HRD-93-48, Apr.  9,
1993). 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :5

We provided a copy of a draft of this report to BIA for its review
and comment.  Concerning the distribution of TPA funds, BIA commented
that there is no statutory or regulatory basis for adjusting TPA
distributions on the basis of tribal revenues.  Furthermore, BIA said
that in some cases it is specifically prohibited from taking into
account certain types of tribal revenues in deciding how to
distribute TPA funds.  We agree with those comments.  But we disagree
with BIA's characterization as "meaningless" our statement that,
under the current method for distributing TPA funds, there is no
assurance that the funds are effectively targeting the most pressing
needs among tribes.  Without assessing the relative needs of the
tribes, BIA cannot know if the most pressing needs are effectively
being met.  And while the relative needs of the tribes have changed
over time, BIA's distribution of TPA base funds--which is based on
historical levels--has not changed to accommodate them.  We continue
to believe that tribal needs assessments would assist BIA in
developing criteria by which to equitably allocate TPA funds.  Our
report recognizes that a tribe's revenues do not, in and of
themselves, serve as the only measure of its needs.  The information
on tribal revenues is presented to illustrate one of the changing
factors that is currently not being addressed in the distribution of
TPA funds and to provide information for the policy debate on this
issue currently before the Congress. 

Setting aside the policy question of whether tribal revenues should
be considered in the distribution of TPA funds, the underlying issue
remains:  whether TPA funds are appropriately distributed among the
tribes under existing Indian policy.  Even without considering tribal
revenues, improvements in the distribution of TPA funds could be made
under existing Indian policy.  Much of the criticism of TPA
distributions over the last 20 years has been that relying on
historical distribution levels has resulted in inequitable funding
among the tribes.  BIA acknowledged that the TPA process has been
faulted in many areas over the years, including the inequities in the
historical distribution method.  In response to these criticisms, BIA
has made a number of key improvements in the TPA process but, after
repeated attempts, has yet to implement a more equitable TPA
distribution method.  As noted in the report and in BIA's comments,
BIA has created another working group to address this issue. 

Regarding the additional information that could be helpful in
determining a revised distribution method, BIA emphasized that the
purpose of the Single Audit Act was to safeguard federal funds, not
to require complete financial reporting on tribal businesses.  We
agree that, if the Congress wishes to consider the tribes' own
revenues in distributing TPA funds, more complete and reliable
financial information on the tribes would be required than that
currently available in the reports filed under the Single Audit Act. 
Furthermore, BIA commented that there would be costs associated with
"compiling, reporting, analyzing, and making funding decisions" on
the basis of the additional types of information discussed in this
report.  We agree that the costs associated with implementing and
maintaining a revised TPA distribution method would be an important
factor to consider in developing a new approach.  However, BIA has
not yet developed a revised approach, so it is not possible to
estimate what those costs would be. 

BIA also provided several technical clarifications, which we
incorporated into the report where appropriate.  BIA's comments and
our specific responses appear in appendix III. 


---------------------------------------------------------- Letter :5.1

We performed our review from November 1997 through May 1998 in
accordance with generally accepted government auditing standards.  A
detailed discussion of our scope and methodology is contained in
appendix IV. 

We are sending copies of this report to the appropriate congressional
committees, the Secretary of the Interior, and other interested
parties.  We will also make copies available to others upon request. 

If you or your staff have any questions, please call me at (202)
512-3841.  Major contributors to this report are listed in appendix
V. 

Victor S.  Rezendes
Director, Energy, Resources, and
 Science Issues


DISTRIBUTION OF FISCAL YEAR 1998
TPA FUNDS, AS OF MARCH 25, 1998
=========================================================== Appendix I

The following table shows the fiscal year 1998 distribution of Tribal
Priority Allocations (TPA) base funds among the Bureau of Indian
Affairs (BIA) 12 area offices and our per capita analysis of that
distribution.  Our per capita analysis is for informational purposes
only; BIA does not distribute TPA funds on a per capita basis, nor
does BIA recommend that such a distribution method be used.  Interior
officials noted that they do not consider the service population
figures, which BIA last reported in 1995, to be reliable.  They also
noted that TPA funds are distributed to tribes, rather than
individuals, and that a lower per capita figure may reflect that
tribes in one area have larger memberships but smaller land bases
than tribes in another area.  We did not independently verify the
distribution amounts or population estimates. 

                                Self-  Non-base and                       BIA
                           governance   other self-                   service
               TPA base      TPA base    governance     Total TPA  population  Per capita
BIA area        funds\a       funds\b     TPA funds         funds          \c  analysis\d
---------  ------------  ------------  ------------  ------------  ----------  ----------
Aberdeen    $51,844,870            $0   $24,254,627   $76,099,497     128,412        $593
Albuquerq    31,992,351       800,765     9,004,512    41,797,628      59,598         701
 ue
Anadarko     17,144,551     2,223,702     4,737,064    24,105,317      45,535         529
Billings     27,338,825     2,198,050    11,246,422    40,783,297      42,427         961
Eastern      26,386,571             0    10,774,883    37,161,454      50,272         739
Juneau       23,657,663    26,426,731    30,439,566    80,523,960      85,259         944
Minneapol    21,387,321    13,085,544    14,010,337    48,483,202      76,883         631
 is
Muskogee     10,956,941    15,879,453     7,677,613    34,514,007     284,740         121
Navajo       48,631,672             0    51,467,124   100,098,796     225,668         444
Phoenix      54,506,291     3,303,513    31,671,077    89,480,881     100,854         887
Portland     45,272,367    19,084,235    42,620,543   106,977,145     104,841       1,020
Sacrament    23,948,187     4,593,450     9,722,083    38,263,720      55,717         687
 o
=========================================================================================
Distribut  $383,067,610   $87,595,443  $247,625,851  $718,288,904   1,260,206        $570
 ed
 subtotal
Not                   0             0    39,059,096    39,059,096          \e          \e
 distribu
 ted\e
=========================================================================================
Total      $383,067,610   $87,595,443  $286,684,947  $757,348,000   1,260,206       $601\
-----------------------------------------------------------------------------------------
\a Includes base funds for only those tribes without self-governance
agreements. 

\b Includes base funds for only those tribes with self-governance
agreements.  These funds are composed of tribe and agency base funds,
and exclude funds that are not comparable to those allocated to
tribes without self-governance agreements.  The amounts were provided
by the Office of Self-Governance. 

\c Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\d Per capita figures were calculated by dividing total TPA funds by
the BIA service population.\

\e Funds not distributed include TPA funds for other BIA offices or
nontribal entities (e.g., funds for BIA's central office, funds for
employees displaced because of tribal contracting, and education
funds for nontribal entities), as well as funds that will be but have
not yet been distributed to tribes or area/agency offices (e.g.,
funds for contract support and welfare assistance).  Because not all
of these funds have been distributed, a per capita analysis is not
applicable. 

Source:  GAO's analysis of BIA's data. 


TPA BASE FUNDS DISTRIBUTED AND PER
CAPITA ANALYSIS FOR TRIBES IN
BIA'S 12 AREA OFFICES, FISCAL YEAR
1998
========================================================== Appendix II

The following tables show the fiscal year 1998 distribution of TPA
base funds among tribes, by area and agency office, and our per
capita analysis of that distribution.  Our per capita analysis is for
informational purposes only; BIA does not distribute TPA funds on a
per capita basis, nor does BIA recommend that such a distribution
method be used.  According to Interior officials, there are reasons
for differences in TPA distributions.  For example, BIA is required
to fund law enforcement and detention in states that do not have
jurisdiction over crimes occurring on Indian lands, so tribes located
in those states may receive more TPA funds for these purposes than
tribes located in other states.  Similarly, BIA has a trust
responsibility for natural resources on reservations, so tribes that
have large land bases may receive more TPA funds for this purpose
than tribes with small land bases. 

Interior officials also noted that they do not consider the service
population figures, which BIA last reported in 1995, to be reliable. 
They also noted that TPA funds are distributed to the tribes, rather
than individuals, and that a lower per capita figure may reflect that
tribes in one area have larger memberships but smaller land bases
than tribes in another area.  We did not independently verify the
distribution amounts or population estimates. 



                                        Table II.1
                         
                              Aberdeen Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Cheyenne River    Cheyenne River Sioux                 $5,316,831      11,813        $450
Crow Creek        Crow Creek Sioux                      2,077,294       3,002         692
Fort Berthold     Three Affiliated Tribes of the Fort   3,863,570       5,100         758
                   Berthold Reservation
Fort Totten       Spirit Lake Sioux                     2,126,502       5,151         413
Lower Brule       Lower Brule Sioux                     1,687,417       1,164       1,450
Pine Ridge        Oglala Sioux                          8,451,371      38,426         220
Rosebud           Rosebud Sioux                         5,692,110      24,217         235
Sisseton          Sisseton-Wahpeton Sioux               2,429,199       3,277         741
Standing Rock     Standing Rock Sioux                   5,670,111       8,198         692
Turtle            Turtle Mountain Band of Chippewa      5,425,302      12,328         440
 Mountain\c        Indians
Winnebago         Omaha Tribe of Nebraska               5,063,421       6,827         742
                   Santee Sioux Tribe of Nebraska
                   Winnebago Tribe of Nebraska
Yankton           Ponca Tribe of Nebraska               2,881,938       7,081        407\
                   Yankton Sioux
\d                Flandreau Santee Sioux                  333,593       1,828         182
=========================================================================================
Total agency      16 tribes                            $51,018,65     128,412       $397\
 office and                                                     9
 tribal
 distributions
TPA distributed   \e                                      826,211          \e          \e
 to area office
 for field
 operations
=========================================================================================
Aberdeen area     16 tribes                            $51,844,87     128,412       $404\
 total                                                          0
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Includes TPA funds and service population for the Trenton, North
Dakota, location of the Turtle Mountain Chippewa. 

\d Tribe not affiliated with an agency office. 

\e These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.2
                         
                             Albuquerque Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Jicarilla         Jicarilla Apache                     $2,270,776       3,735        $608
Laguna            Pueblo of Laguna                      2,018,792       4,693         430
Mescalero         Mescalero Apache                      3,038,434       3,056         994
Northern Pueblos  Pueblo of Nambe                       5,805,566       8,692         668
                   Pueblo of Picuris
                   Pueblo of Pojoaque
                   Pueblo of San Ildefonso
                   Pueblo of San Juan
                   Pueblo of Santa Clara\c
                   Pueblo of Taos
                   Pueblo of Tesuque
Ramah-Navajo      Part of the Navajo Nation             2,170,189       3,060         709
Southern Pueblos  Pueblo of Acoma                       8,773,030      24,867         353
                   Pueblo of Cochiti
                   Pueblo of Isleta
                   Pueblo of Jemez
                   Pueblo of San Felipe
                   Pueblo of Sandia
                   Pueblo of Santa Ana
                   Pueblo of Santo Domingo
                   Pueblo of Zia
                   Ysleta del Sur Pueblo
Southern Ute      Southern Ute                          1,841,456       1,411       1,305
Ute Mountain      Ute Mountain Ute                      2,075,466       1,325       1,566
Zuni              Zuni                                  2,729,828       8,759         312
=========================================================================================
Total agency      24 tribes $                          30,723,537     9,598 $        516\
 office and                                                     5
 tribal
 distributions
TPA distributed   \d                                    2,069,579          \d          \d
 to area office
 for field
 operations
=========================================================================================
Albuquerque area  24 tribes                            $32,793,11      59,598        $550
 total                                                          6
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\d These area office funds are used to provide services to some or
all the tribes in the area.  They are included in the per capita
analysis for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.3
                         
                              Anadarko Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Anadarko          Apache                               $6,212,816      14,325       $434\
                   Caddo
                   Comanche
                   Delaware of Western Oklahoma
                   Fort Sill Apache
                   Kiowa
                   Wichita and Affiliated Tribes
Concho            Cheyenne-Arapaho Tribes               2,498,521       7,258         344
Horton            Iowa Tribe of Kansas and Nebraska     1,930,499       3,301         585
                   Kickapoo Tribe of Indians of the
                   Kickapoo Reservation in Kansas
                   Prairie Band of Potawatomi
                   Sac & Fox Nation of Missouri in
                   Kansas and Nebraska
Pawnee            Kaw Nation\c                          3,543,657       5,006        708\
                   Otoe-Missouria
                   Pawnee
                   Ponca Tribe of Oklahoma
                   Tonkawa
Shawnee           Absentee-Shawnee\c                    3,440,041      15,131        227\
                   Citizen Potawatomi Nation
                   Iowa of Oklahoma
                   Kickapoo of Oklahoma\c
                   Kickapoo Traditional of Texas
                   Sac & Fox Nation, Oklahoma\c
\d                Alabama-Coushatta Tribes of Texas       705,791         514       1,373
=========================================================================================
Total agency      24 tribes                            $18,331,32      45,535       $\403
 office and                                                     5
 tribal
 distributions
TPA distributed   \e                                    1,036,928          \e          \e
 to area office
 for field
 operations
=========================================================================================
Anadarko area     24 tribes                            $19,368,25      45,535       $425\
 total                                                          3
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\d Tribe not affiliated with an agency office. 

\e These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.4
                         
                              Billings Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Blackfeet         Blackfeet                            $4,586,818       8,208        $559
Crow              Crow                                  4,674,503       7,153         654
Fort Belknap      Fort Belknap Indian Community         3,548,902       3,809         932
Fort Peck         Assiniboine and Sioux Tribes of the   4,829,070       6,555         737
                   Fort Peck Indian Reservation
Northern          Northern Cheyenne                     4,043,516       4,383         923
 Cheyenne
Rocky Boy's       Chippewa-Cree\c                       2,263,099       3,142         720
Wind River        Arapahoe Tribe and Shoshone Tribe     4,040,805       9,177         440
                   of the Wind River Reservation
=========================================================================================
Total agency      8 tribes $                           27,986,713     2,427 $         660
 office and                                                     4
 tribal
 distributions
TPA distributed   \d                                    1,550,162          \d          \d
 to area office
 for field
 operations
=========================================================================================
Billings area     8 tribes $                           29,536,875     2,427 $        696\
 total                                                          4
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figure was calculated by dividing the TPA base funds by
the corresponding BIA service population. 

\c Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\d These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.5
                         
                         Eastern Area: TPA Base Funds Distributed
                           and Per Capita Analysis, Fiscal Year
                                           1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Cherokee          Eastern Band of Cherokee             $2,117,136      11,240        $188
Choctaw           Mississippi Band of Choctaw           2,992,800       7,419         403
New York Liaison  Cayuga Nation\c                       3,970,305      16,014         248
 Office            Oneida Nation of New York
                   Onondaga Nation\c
                   Seneca Nation of New York
                   St. Regis Band of Mohawk
                   Tonawanda Band of Seneca\c
                   Tuscarora Nation\c
Seminole          Seminole Tribe of Florida             2,741,628       2,292       1,196
\d                Aroostook Band of Micmac                550,011       1,155         476
\d                Catawba Indian Nation                 1,559,722       1,597         977
\d                Chitimacha                              706,944         373       1,895
\d                Coushatta                               392,430         362       1,084
\d                Houlton Band of Maliseet                379,351         331       1,146
\d                Jena Band of Choctaw                    215,604         109       1,978
\d                Mashantucket Pequot                     385,000         155       2,484
\d                Miccosukee                            1,772,217         589       3,009
\d                Mohegan                                 493,200         642         768
\d                Narragansett                          1,039,048       2,439         426
\d                Passamaquoddy\e                       2,100,714       1,600       1,313
\d                Penobscot                             1,789,752       1,206       1,484
\d                Poarch Band of Creek Indians          1,280,635       1,673         765
\d                Tunica-Biloxi                           342,194         211       1,622
\d                Wampanoag Tribe of Gay Head             787,951         865         911
=========================================================================================
Total agency      25 tribes                            $25,616,64      50,272        $510
 office and                                                     2
 tribal
 distributions
TPA distributed   \f                                      769,929          \f          \f
 to area office
 for field
 operations
=========================================================================================
Eastern area      25 tribes                            $26,386,57      50,272        $525
 total                                                          1
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area.\

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Tribe identified under the small tribes funding initiative. 

\d Tribe not affiliated with an agency office. 

\e Includes both Indian Township and Pleasant Point reservations. 

\f These area office funds are used to provide services to some or
all the tribes in the area.  They are included in the per capita
analysis for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.6
                         
                         Juneau Area: TPA Base Funds Distributed
                           and Per Capita Analysis, Fiscal Year
                                           1998

                          Number of
                           tribe(s)
BIA agency         served by agency          TPA base       BIA service        Per capita
office                     office\a             funds      population\b        analysis\c
----------------  -----------------  ----------------  ----------------  ----------------
Anchorage                        74       $14,553,806            29,407              $495
Bethel                           56        10,008,153            16,775               597
Fairbanks                        47         9,706,881            15,886               611
Nome                             31         6,306,900            11,357               555
Southeast                        18         5,553,800            11,834               469
=========================================================================================
Total agency                    226       $46,129,540            85,259              $541
 office
 distributions
TPA distributed                  \d         3,954,854                \d                \d
 to area office
 for field
 operations
=========================================================================================
Juneau area                     226       $50,084,394            85,259              $587
 total
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts to the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a The Juneau area has 158 partial or complete self-governance tribes
and BIA identified 208 tribes in the area under the small tribes
funding initiative (120 of these small tribes were also
self-governance tribes). 

\b Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\c Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\d These area office funds are used to provide services to some or
all the tribes in the area.  They are included in the per capita
analysis for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.7
                         
                             Minneapolis Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Great Lakes       Bad River Band of Lake Superior      $6,121,788      18,543        $330
                   Chippewa Indians
                   Forest County Potawatomi Community
                   of Wisconsin
                   Potawatomi Indians\c
                   Ho-Chunk Nation
                   Lac Courte Oreilles Band of Lake
                   Superior Chippewa Indians
                   Lac du Flambeau Band of Lake
                   Superior Chippewa Indians
                   Oneida Tribe of Wisconsin\d
                   Red Cliff Band of Lake Superior
                   Chippewa Indians
                   St. Croix Chippewa
                   Sokaogon Chippewa Community of the
                   Mole Lake Band of Chippewa
                   Indians\c
                   Stockbridge-Munsee Community of
                   Wisconsin
Menominee Field   Menominee                             3,845,581       4,452         864
 Office
Michigan          Bay Mills Indian Community           10,692,187      22,169         482
                   Grand Traverse Band of Ottawa &
                   Chippewa Indians\d
                   Hannahville Indian Community
                   Huron Potawatomi, Inc.
                   Keweenaw Bay Indian Community
                   Lac Vieux Desert Band of Lake
                   Superior Chippewa Indians
                   Little River Band of Ottawa
                   Indians
                   Little Traverse Bay Bands of Odawa
                   Indians
                   Pokagon Band of Potawatomi
                   Indians
                   Saginaw Chippewa Indian Tribe
                   Sault Ste. Marie Tribe of Chippewa
                   Indians\d
Minnesota         Minnesota Chippewa Tribe -            7,789,448      21,446         363
                   Bois Forte Band (Nett Lake)\d
                   Fond du Lac Band\d
                   Grand Portage Band\d
                   Leech Lake Band\d
                   Mille Lacs Band\d
                   White Earth Band
Minnesota Sioux   Lower Sioux Indian Community\c          665,337       1,270         524
                   Prairie Island Indian Community\c
                   Shakopee Mdewakanton Sioux
                   Community\c
                   Upper Sioux Indian Community \c
Red Lake          Red Lake Band of Chippewa Indians\d   4,654,708       8,111         574
Sac & Fox Field   Sac & Fox Tribe of the Mississippi      295,087         892         331
 Office            in Iowa
=========================================================================================
Total agency      29 tribes                            $34,064,13      76,883        $443
 office and                                                     6
 tribal
 distributions
TPA distributed   \e                                      408,729          \e          \e
 to area office
 for field
 operations
=========================================================================================
Minneapolis area  29 tribes                            $34,472,86      76,883        $448
 total                                                          5
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Tribe identified under the small tribes funding initiative. 

\d Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\e These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.8
                         
                              Muskogee Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Chickasaw         Chickasaw Nation\c                   $2,776,948      23,036        $121
Miami             Eastern Shawnee\c,d                   2,448,385       5,482         447
                   Miami\d
                   Modoc\c,d
                   Ottawa\d
                   Peoria\d
                   Quapaw
                   Seneca-Cayuga
                   Wyandotte\c
Okmulgee          Alabama-Quassarte Tribal Town of      5,197,682      64,330          81
                   the Creek Nation\d
                   Kialegee Tribal Town of the Creek
                   Nation\d
                   Muskogee (Creek) Nation\c
                   Thlopthlocco Tribal Town of the
                   Creek Nation\d
Osage             Osage Nation of Oklahoma              2,712,476      10,529         258
Talihina          Choctaw Nation of Oklahoma\c          3,686,811      59,832          62
Wewoka            Seminole Nation of Oklahoma           2,102,457       6,667         315
\e                Cherokee Nation of Oklahoma\c         6,575,277     114,864          57
                   Delaware
                   United Keetoowah Band of Cherokee
                   Indians
=========================================================================================
Total agency      19 tribes                            $25,500,03     284,740         $90
 office and                                                     6
 tribal
 distributions
TPA distributed   \f                                    1,336,358          \f          \f
 to area office
 for field
 operations
=========================================================================================
Muskogee area     19 tribes                            $26,836,39     284,740         $94
 total                                                          4
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\d Tribe identified under the small tribes funding initiative. 

\e Tribes not affilated with an agency office. 

\f These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                        Table II.9
                         
                         Navajo Area: TPA Base Funds Distributed
                           and Per Capita Analysis, Fiscal Year
                                           1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe served by agency office             funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Chinle            Part of the Navajo Nation              $692,981      34,641         $20
Eastern Navajo    Part of the Navajo Nation             1,242,517      42,709          29
Fort Defiance     Part of the Navajo Nation               757,081      58,183          13
Shiprock          Part of the Navajo Nation             1,190,397      48,337          25
Western Navajo    Part of the Navajo Nation               634,310      41,798          15
=========================================================================================
Total agency      1 tribe $                             4,517,286    25,668 $          20
 office                                                         2
 and tribal
 distributions
TPA distributed   su>c                                 44,114,386       su>c\          \c
 to < area                                                      <
 office for
 field
 operations
=========================================================================================
Navajo area       1 tribe                              $48,631,67     225,668        $216
 total                                                          2
-----------------------------------------------------------------------------------------
\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c These area office funds are used to provide services in the area. 
They are included in the per capita analysis for the area total. 

Source:  GAO's analysis of BIA's data. 



                                       Table II.10
                         
                         Phoenix Area: TPA Base Funds Distributed
                           and Per Capita Analysis, Fiscal Year
                                           1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Colorado River    Chemehuevi                           $3,580,809       3,201      $1,119
                   Colorado River Indian Tribes
                   Fort Mojave
Eastern Nevada    Confederated Tribes of the Goshute    3,927,050       4,384         896
                   Reservation
                   Duckwater Shoshone\c
                   Ely Shoshone\c
                   Shoshone-Paiute Tribes of the Duck
                   Valley Reservation\c
                   Te-Moak Tribe of Western Shoshone
                   Indians
Fort Apache       White Mountain Apache                 6,561,314      16,692         393
Fort Yuma         Cocopah                               1,335,972       3,467         385
                   Quechan
Hopi              Hopi                                  4,462,406       6,339         704
Papago            Tohono O'odham Nation                 6,565,289      19,225         341
Pima              Ak Chin Indian Community              5,511,890      12,234         451
                   Gila River Pima-Maricopa Indian
                   Community
Salt River        Fort McDowell Mohave-Apache Indian    4,436,517      11,345         391
                   Community
                   Pascua Yaqui
                   Salt River Pima-Maricopa Indian
                   Community\c
San Carlos        San Carlos Apache                     6,107,679       8,098         754
Southern Paiute   Kaibab Band of Paiute Indians         1,940,396       1,461       1,328
 Field Station     Las Vegas Tribe of Paiute Indians
                   Moapa Band of Paiute Indians
                   Paiute Tribe of Utah
                   San Juan Southern Paiute
Truxton Canon     Havasupai                             3,478,651       4,708         739
                   Hualapai
                   Tonto Apache
                   Yavapai-Apache Nation
                   Yavapai-Prescott
Uintah & Ouray    Skull Valley Band of Goshute          2,809,899       3,300         851
                   Indians\d
                   Ute Indian Tribe
Western Nevada    Fort McDermitt Paiute and Shoshone    5,351,353       6,400         836
                   Tribes
                   Lovelock Paiute\d
                   Paiute-Shoshone Tribe of the
                   Fallon Reservation and Colony
                   Pyramid Lake Paiute Tribe
                   Reno-Sparks Indian Colony
                   Summit Lake Paiute\d
                   Walker River Paiute
                   Washoe
                   Winnemucca Indian Colony\d
                   Yerington Paiute
                   Yomba Shoshone\d
=========================================================================================
Total agency      42 tribes                            $56,069,22     100,854        $556
 office and                                                     5
 tribal
 distributions
TPA distributed   \e                                    1,740,579          \e          \e
 to area office
 for field
 operations
=========================================================================================
Phoenix area      42 tribes                            $57,809,80     100,854        $573
 total                                                          4
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\d Tribe identified under the small tribes funding initiative. 

\e These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                       Table II.11
                         
                              Portland Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                                                                          BIA
                                                                      service         Per
BIA agency                                               TPA base  population      capita
office            Tribe(s) served by agency office          funds          \a  analysis\b
----------------  -----------------------------------  ----------  ----------  ----------
Colville          Confederated Tribes of the Colville  $7,224,442       4,929      $1,466
                   Reservation
Flathead          Confederated Salish and Kootenai      4,091,583       7,667         534
                   Tribes of the Flathead
                   Reservation\c
Fort Hall         Northwestern Band of Shoshoni         3,375,522       6,631         509
                   Nation of Utah
                   Shoshone-Bannock Tribes of the
                   Fort Hall Reservation
Metlakatla Field  Metlakatla Indian Community,          1,910,065       1,564       1,221
 Office            Annette Island Reserve\c
Northern Idaho    Coeur D'Alene                         5,145,835       3,577       1,439
                   Kootenai Tribe of Idaho\c
                   Nez Perce
Olympic           Confederated Tribe of the Chehalis    9,460,225      10,862         871
 Peninsula         Reservation
                   Hoh
                   Jamestown S'Klallam Tribe\c
                   Lower Elwha Tribal Community\c
                   Makah\c
                   Quileute
                   Quinault\c
                   Shoalwater Bay\c
                   Skokomish\c
                   Squaxin Island\c
Puget Sound       Lummi\c                               8,011,371      36,225         221
                   Muckleshoot\c
                   Nisqually\c
                   Nooksack
                   Port Gamble Indian Community\c
                   Puyallup
                   Samish\d
                   Sauk-Suiattle
                   Stillaguamish
                   Suquamish\c
                   Swinomish\c
                   Tulalip
                   Upper Skagit
Siletz            Confederated Tribes of the Coos,      4,334,658       8,463         512
                   Lower Umpqua and Siuslaw Indians
                   Confederated Tribes of the Grand
                   Ronde Community\c
                   Confederated Tribes of the Siletz
                   Reservation\c
                   Coquille
                   Cow Creek Band of Umpqua Indians
Spokane           Kalispel Indian Community             2,635,418       1,586       1,662
                   Spokane
Umatilla          Confederated Tribe of the Umatilla    2,951,049       2,154       1,370
                   Reservation
Warm Springs      Burns Paiute                          6,321,256       5,765       1,096
                   Confederated Tribes of the Warm
                   Springs Reservation
                   Klamath
Yakama            Confederated Tribes and Bands of      6,680,314      15,968         418
                   the Yakama Indian Nation
=========================================================================================
Total agency      43 tribes                            $62,141,73     105,391        $590
 office and                                                     8
 tribal
 distributions
TPA distributed   \e                                    2,214,864          \e          \e
 to area office
 for field
 operations
=========================================================================================
Portland area     43 tribes                            $64,356,60     105,391        $611
 total                                                          2
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\b Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\c Self-governance tribe.  To make the data for self-governance
tribes more comparable to the data presented for non-self-governance
tribes, only the tribe/agency portion of the self-governance base
funds is included in this table. 

\d Newly recognized tribe.  Population figure provided by the Office
of Audit and Evaluation under the Assistant Secretary for Indian
Affairs. 

\e These area office funds are used to provide services to some or
all tribes in the area.  They are included in the per capita analysis
for the area total. 

Source:  GAO's analysis of BIA's data. 



                                       Table II.12
                         
                             Sacramento Area: TPA Base Funds
                           Distributed and Per Capita Analysis,
                                     Fiscal Year 1998

                          Number of
                           tribe(s)
BIA agency         served by agency          TPA base       BIA service        Per capita
office                     office\a             funds      population\b        analysis\c
----------------  -----------------  ----------------  ----------------  ----------------
Central                          52       $11,726,739            21,245              $552
 California
Northern                         18         8,008,275            24,576               326
 California
Palm Springs                      1         179,335\d               281               638
 Field Station
Southern                         28         6,774,768             9,615               705
 California
=========================================================================================
Total agency                     99       $26,689,117            55,717              $479
 office and
 tribal
 distributions
TPA distributed                  \e           206,991                \e                \e
 to Klamath
 Field Office
TPA distributed                  \e           743,960                \e                \e
 to Palm Springs
 Field Office
TPA distributed                  \e           901,569                \e                \e
 to area office
 for field
 operations
=========================================================================================
Sacramento area                  99       $28,541,637            55,717              $512
 total
-----------------------------------------------------------------------------------------
Note:  TPA amounts distributed to an agency office serving more than
one tribe may be used to provide services for some or all the tribes
within its jurisdiction; therefore, total TPA base amounts for the
specific tribes served by these multitribe agency offices were not
readily available.  Similarly, the area office's TPA base
distribution is listed separately from the amounts distributed to the
agency offices and tribes because the funds may be used for more than
one tribe in the area. 

\a The Sacramento area has 6 self-governance tribes and BIA
identified 76 tribes in the area under the small tribes funding
initiative (2 of these small tribes were also self-governance
tribes). 

\b Service population is the number of Indians eligible to receive
services from BIA as of 1995, the most recent year for which data
were available. 

\c Per capita figures were calculated by dividing the TPA base funds
by the corresponding BIA service population. 

\d Individual allocation for the Agua Caliente Band of Cahuilla
Indians.  The amount does not include any funds allocated to the Palm
Springs Field Station. 

\e These funds are used to provide services to some or all tribes in
the field office or area.  They are included in the per capita
analysis for the area total. 

Source:  GAO's analysis of BIA's data. 




(See figure in printed edition.)Appendix III
COMMENTS FROM THE BUREAU OF INDIAN
AFFAIRS
========================================================== Appendix II



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



   GAO COMMENTS
-------------------------------------------------------- Appendix II:1

1.  Our earlier report entitled Tax Policy:  A Profile of the Indian
Gaming Industry (GAO/GGD-97-91, May 5, 1997) stated that the total
revenues reported from Indian gaming operations during 1995 were $4.5
billion, with a total net income of $1.9 billion.  About 40 percent
($1.85 billion) of all gaming revenues was generated by eight tribes. 
In its comments, BIA incorrectly compared the revenue figure for
these eight tribes ($1.8 billion) with the total net income figure
for all the gaming tribes ($1.9 billion).  Nevertheless, we agree
with BIA's overall point that these eight tribes account for a
substantial portion of the gaming revenues and that these eight
tribes receive only a small fraction of the overall TPA funds. 

2.  The data on tribal revenues presented in this report are provided
for informational purposes only, for the policy debate currently
before the Congress.  We chose to include the complete range of
tribal revenue figures, from negative to positive, to provide a
balanced picture of the financial position of as many tribes as
possible.  Some tribes reported substantial revenues, while others
reported losses from their business enterprises.  We understand BIA's
concern, and we caution that no inference should be drawn from the
presentation of these data that tribes with failing business
enterprises should receive increased federal assistance. 


SCOPE AND METHODOLOGY
========================================================== Appendix IV

We obtained information on BIA's basis for distributing 1998 TPA
funds and on the tribes' own self-reported revenues under the Single
Audit Act.  We contacted officials of the Department of the
Interior's Bureau of Indian Affairs, Office of Audit and Evaluation,
and Office of Self-Governance in Washington, D.C., and its Office of
Audit and Evaluation in Lakewood, Colorado.  We analyzed distribution
data provided by BIA and the Office of Self-Governance to determine
the amounts distributed to BIA area and agency offices and to tribes
in fiscal year 1998. 

At Interior's Office of Audit and Evaluation in Washington, D.C., and
Lakewood, Colorado, we examined all 326 of the most recent financial
statements that were submitted as of March 1998 under the Single
Audit Act by tribes, tribal associations, and tribal enterprises. 
These statements generally covered 1995 or 1996.  We did not examine
statements submitted for some entities, such as tribal housing
authorities and community colleges, because these entities are
financially separate from the tribes.  From each of the financial
statements we examined, we obtained information about the independent
auditor's opinion, revenues for all fund types reported, and
operating income for the tribes that included tribal business
information in their statements. 

Our analyses of 299 tribes' own revenues were derived from the
information contained in the financial statements.  Of the 326
financial statements we reviewed, 299 were for tribes (2 of which
were not federally recognized).  Another 13 were for tribal
businesses or components of tribes, and we merged their financial
information into that of the cognizant tribes for analysis.  The
remaining 14 financial statements were for consortia or associations
representing multiple tribes, primarily those in Alaska; we excluded
the financial information from these statements from our analysis of
tribes' own revenues. 

We performed our review from November 1997 through May 1998 in
accordance with generally accepted government auditing standards. 


MAJOR CONTRIBUTORS TO THIS REPORT
=========================================================== Appendix V

RESOURCES, COMMUNITY, AND ECONOMIC
DEVELOPMENT DIVISION

Jennifer Duncan
Ann Fruik
Barry Hill
Diane Lund
Jeffery Malcolm
Sue Naiberk
Pam Tumler


*** End of document. ***