[Survey Report on the Indian Acute Distress Donation Program for Selected Reservations Under the Jurisdiction of the Billings Area Office, Bureau of Indian Affairs]
[From the U.S. Government Printing Office, www.gpo.gov]

Report No. 98-I-704

Title: Survey Report on the Indian Acute Distress Donation Program
       for Selected Reservations Under the Jurisdiction of the
       Billings Area Office, Bureau of Indian Affairs

Date:  September 30, 1998




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U.S. Department of the Interior
Office of Inspector General





SURVEY REPORT




INDIAN ACUTE DISTRESS DONATION PROGRAM
FOR SELECTED RESERVATIONS UNDER THE
JURISDICTION OF THE BILLINGS AREA
OFFICE, BUREAU OF INDIAN AFFAIRS


REPORT NO. 98-I-704
SEPTEMBER 1998





MEMORANDUM


TO:               The Secretary

FROM:             Richard N. Reback
                  Acting Inspector General

SUBJECT SUMMARY:  Final Survey Report for Your Information -
                  "Indian Acute  Distress Donation Program for
                  Selected Reservations Under the Jurisdiction of
                  the Billings Area Office, Bureau of Indian
                  Affairs" (No. 98-I-704)


Attached for your information is a copy of the subject final
survey report, which presents the results of our  survey  of
the Indian Acute Distress Donation Program at the Blackfeet,
Fort  Peck,  and  Rocky Boy's Indian Reservations, which are
under the jurisdiction  of  the  Billings Area Office of the
Bureau of Indian Affairs.  The objective  of  the survey was
to determine whether these Bureau and tribal offices ensured
that emergency feed grain provided through the  Program  was
distributed  only to Indian tribal members who were eligible
for assistance.

We found that  the  Bureau's  Blackfeet Agency, the Chippewa
Cree  Tribe  of  the  Rocky  Boy's  Reservation,   and   the
Assiniboine  and  Sioux  Tribes  at  the  Fort  Peck  Indian
Reservation  did  not ensure that emergency feed grains were
distributed only to  eligible  applicants in accordance with
the  requirements  of the 1978 Memorandum  of  Understanding
Number  5  between  the  Departments  of  the  Interior  and
Agriculture   and   applicable    Billings    Area    Office
instructions.  Neither Bureau Headquarters nor Billings Area
Office  officials issued supplemental guidance to the Agency
or tribal officials adequately defining "principal source of
income,"  which  resulted  in inconsistent determinations of
eligibility.  In addition, Agency  and  tribal officials did
not  provide  the monitoring necessary to ensure  compliance
with the Program.   As  a  result,  232,735 pounds of grain,
valued  at $12,400, was provided to 16 Program  participants
who did not have any agricultural income, and 336,000 pounds
of grain,  valued  at $18,000, was provided to an additional
14 Program participants  who did not pick up grain until the
last 30 days of the Program  and consequently received grain
in excess of their entitlement.

We did not make recommendations  to correct the deficiencies
in the Program criteria because the  Indian  Acute  Distress
Donation  Program  will  be  replaced by the American Indian
Livestock Feed Program, which  will be administered directly
by   tribal   governments   through   the    Department   of
Agriculture's  Commodity  Credit  Corporation and  will  not
involve the Bureau.

If  you have any questions concerning  this  matter,  please
contact  me  at  (202)  208-5745  or Mr. Robert J. Williams,
Assistant Inspector General for Audits, at (202) 208-4252.


Attachment




SURVEY REPORT                              W-IN-BIA-002-98-R


Memorandum

   To:       Assistant Secretary for Indian Affairs

   From:     Robert J. Williams
             Assistant Inspector General for Audits

   Subject:  Survey Report on the Indian Acute Distress Donation
             Program for Selected Reservations Under the
             Jurisdiction of the Billings Area Office,
             Bureau of Indian Affairs (No. 98-I-704)



INTRODUCTION

This report presents the results of our survey of the Indian
Acute Distress Donation Program at the Blackfeet, Fort Peck,
and  Rocky  Boy's  Indian  Reservations, which are under the
jurisdiction of the Billings  Area  Office  of the Bureau of
Indian Affairs.  The Program is administered  by  the Bureau
for  the  Blackfeet  Reservation, the Assiniboine and  Sioux
Tribes for the Fort Peck  Reservation, and the Chippewa Cree
Tribe for the Rocky Boy's Indian Reservation.  The objective
of  the survey was to determine  whether  these  Bureau  and
tribal  offices  ensured  that emergency feed grain provided
through  the  Indian  Acute Distress  Donation  Program  was
distributed only to Indian  tribal members who were eligible
for assistance.  We performed  the  review based on a May 6,
1997,  request  from  the  Assistant  Secretary  for  Indian
Affairs.

BACKGROUND

Section 407 of the Agricultural Act of  1949 (7 U.S.C. 1427)
authorized  the  U.S. Department of Agriculture  to  provide
free  feed  grain  for   the   maintenance  of  Indian-owned
livestock on any reservation designated  by the Secretary of
Agriculture to be an acute distress area.[1]  Prior to 1996,
the  Departments  of  Agriculture  and the Interior  jointly
administered an emergency feed program for Indians, known as
the  Indian  Acute  Distress  Donation  Program,  under  the
provisions of the May 6, 1978, interdepartmental  Memorandum
of  Understanding Number 5 ("Agreement To Donate Feed  Grain
To Relieve Economic Distress or Disaster Conditions Existing
Among Indian Tribes").

The Program  was  suspended  by  Section  171 of the Federal
Agriculture  Improvement  and Reform Act of 1996  (7  U.S.C.
7201).  However, in response  to  severe  weather conditions
during   the   winter   of  1996-1997,  the  Department   of
Agriculture  provided  emergency   feed  assistance  to  six
reservations  in  Montana  using  the  guidelines   of   the
memorandum  of  understanding.   Under  the  memorandum, the
Bureau  of Indian Affairs was responsible for ensuring  that
grain was  distributed  only  to  eligible  Indians  and for
monitoring  the Program.  The memorandum also specified  the
amount of feed  grain  provided  per  day  for  each type of
livestock,  which, according to a Bureau official,  was  not
enough  grain  to  fully  feed  an  animal  but  was  enough
supplemental grain only to sustain the animal.[2]

To address  the  confusion  as  to  whether the Indian Acute
Distress Donation Program had been reinstated, the Assistant
Secretary for Indian Affairs, in a May  14,  1997, letter to
tribal leaders, stated:

     The Federal Agriculture Improvement and Reform Act
     of  1996  suspended the Agricultural Act of  1949,
     which established the IADDP [Indian Acute Distress
     Donation Program].  It became confusing to a large
     number of people  who thought that IADDP was being
     reinstituted when in actuality only the provisions
     for IADDP were being used to donate grain.

However,  the  Bureau  of Indian  Affairs  referred  to  the
emergency assistance provided during the winter of 1996-1997
as the Indian Acute Distress  Donation  Program.  Therefore,
for the purposes of this report, we refer  to the assistance
provided  during  this  period as the Indian Acute  Distress
Donation Program.

The Program was administered  by  Blackfeet Agency officials
at the Blackfeet Reservation, by the  Chippewa Cree Tribe at
the  Rocky  Boy's  Reservation under a compact[3]  with  the
Bureau, and by  the Assiniboine and Sioux Tribes at the Fort
Peck  Reservation  under  a  contract[4]  with  the  Bureau.
During  the  winter  of  1996-1997,  grain with an estimated
value of $571,000 was provided to 212  Program  participants
at the Blackfeet (171), Fort Peck (29), and Rocky Boy's (12)
Reservations in Montana.

The  Department  of  Agriculture  established  a replacement
program  (American  Indian Livestock Feed Program)  for  the
suspended Indian Acute  Distress  Donation Program but as of
the time of our review had not developed  final  regulations
for  administering  the  Livestock  Feed  Program.  However,
according to the Department's draft interim  rules  for  the
Livestock   Feed   Program,   the  Department,  through  its
Commodity Credit Corporation, will  contract  directly  with
tribal    governments   to   provide   emergency   livestock
assistance.   Thus, the Bureau of Indian Affairs will not be
involved administratively or operationally with the proposed
program.

SCOPE OF SURVEY

The survey was  conducted  from May 4 through July 22, 1998,
at  the  Billings  Area Office  in  Billings,  Montana;  the
Blackfeet Agency Office  in  Browning,  Montana;  the  Rocky
Boy's  Indian  Reservation  in  Box Elder, Montana; the Fort
Peck Indian Reservation in Poplar, Montana; and eight of the
nine grain elevators used during the Program.  To accomplish
our objective, we reviewed applicable  laws and regulations,
including  Memorandum  of  Understanding  Number  5;  Bureau
policies  and  procedures,  including Billings  Area  Office
instructions; and individual  applications  for  assistance.
We also interviewed Bureau and tribal officials to determine
the  process used to establish eligibility and verified  the
distribution   of   grain   to   Program   participants   by
interviewing  grain  elevator  managers  and  administrative
personnel   and  by  reviewing  the  grain  elevator  weight
tickets.

We conducted  the  survey in accordance with the "Government
Auditing Standards,"  issued  by  the Comptroller General of
the United States.  Accordingly, we  included  such tests of
records  and other auditing procedures that were  considered
necessary under the circumstances.  As part of our audit, we
reviewed the  Department's  Accountability Report for fiscal
year  1997,  which  includes  information  required  by  the
Federal Managers' Financial Integrity  Act  of 1982, and the
Bureau's  annual  assurance  statement  and determined  that
there  were no reported control weaknesses  related  to  the
audit objective.

PRIOR AUDIT COVERAGE

During the  past  5  years,  neither the Office of Inspector
General nor the General Accounting  Office  has  issued  any
reports on the Indian Acute Distress Donation Program.

RESULTS OF SURVEY

We found that the Bureau of Indian Affairs Blackfeet Agency,
the  Chippewa Cree Tribe of the Rocky Boy's Reservation, and
the Assiniboine  and  Sioux  Tribes  at the Fort Peck Indian
Reservation did not ensure that emergency  feed  grains were
distributed  only to eligible applicants in accordance  with
the requirements  of  the  1978  Memorandum of Understanding
Number 5 and applicable Billings Area  Office  instructions.
Under  the  terms  of  the memorandum of understanding,  the
Bureau is to provide feed grain to Indian tribal members who
do not have sufficient means  to purchase the feed necessary
to maintain the livestock used  as  the  principal source of
food  and  income  for the members and their  families.   In
addition,  the  memorandum   and  Area  Office  instructions
defined the amount of grain that eligible participants could
receive.  However, officials at  the  Bureau's  Headquarters
did not provide supplemental instructions, and guidance from
the Billings Area Office did not define the term  "principal
source of income" in sufficient detail to enable Agency  and
tribal  officials  to  determine  eligibility.  In addition,
Agency and tribal officials did not  provide  the monitoring
necessary  to  ensure  compliance  with the Program.   As  a
result,  232,735  pounds of grain, valued  at  $12,400,  was
provided to 16 Program  participants  who  did  not have any
agricultural income, and 336,000 pounds of grain,  valued at
$18,000,   was   provided   to   an   additional  14 Program
participants who did not pick up grain  until  the  last  30
days  of  the  Program  and  consequently  received grain in
excess of their entitlement.

Supplemental Guidance

Neither Bureau Headquarters nor Area Office officials issued
supplemental  guidance  to  the  Agency or tribal  officials
adequately  defining  "principal source  of  income,"  which
resulted  in  inconsistent  determinations  of  eligibility.
According  to the  memorandum  of  understanding,  a  tribal
member eligible  for  the  Program  is defined as one who is
without  sufficient  cash  or  credit to  purchase  feed  to
maintain his or her subsistence  livestock  after  allowance
for  living  expenses.   The  memorandum defines subsistence
livestock  as  those  animals that  provide  the  "principal
source of food and income"  for  the  member  and family but
does  not  provide  any  guidelines  quantifying  "principal
source  of  income."   Agency  officials  at  the  Blackfeet
Reservation allowed Program applicants to participate in the
Program  without  consideration  of  how  much of the tribal
member's  income  was  derived  from  agricultural   sources
(livestock, hay, and grain).  For example, we found that  16
participants  at  the  Blackfeet  Reservation  were declared
eligible  and  received  232,735 pounds of grain, valued  at
$12,400, even though the 16 participants  reported that they
had no income from agricultural  sources, while at the Rocky
Boy's  Reservation,  5  applicants  who  declared  livestock
income[5]  ranging  from  12 to 46 percent  of  their  total
income were determined to be  ineligible because an official
of the Chippewa Cree Tribe determined  that  the applicants'
livestock income was not their principal source of income.

Program Monitoring

Blackfeet  Agency and tribal officials did not  monitor  the
Program to ensure that grain deliveries to participants were
limited  to  amounts  authorized  under  the  memorandum  of
understanding    and   additional   Billings   Area   Office
instructions.  Under  these  criteria, the Bureau is to make
feed grain available to participating  Indians based on each
participant's  maximum  daily  allowance multiplied  by  the
number of days remaining from the  date of pickup to the end
of the Program for the designated area.[6]   For  example, a
participant  picking  up  grain  for the first time 30  days
before the end of the Program would  be  entitled  to only a
30-day  allotment  of  grain,  and a participant picking  up
grain for the first time on the  last  day  of  the  Program
would  be  entitled to a 1-day allotment of grain.  However,
the Bureau did  not  inform  either  the participants or the
grain elevator operators of this requirement.   As a result,
at  least  14 participants  at  the  three locations visited
picked  up 336,000 pounds of grain, valued  at  $18,000,  in
excess of amounts allowable under the Program.  For example:

     -  At  the  Blackfeet  Reservation, one participant was
awarded 150,738 pounds of grain,  valued  at  $8,008,  for a
111-day  period.   He  picked up his entire allotment on May
30, 1997, 1 day before the  Program  ended.   Based  on  the
criteria,  the  participant  was  entitled  to  only a 2-day
allotment, or 2,716 pounds of grain, valued at $144.   Thus,
the participant received 148,022 pounds of grain, valued  at
$7,864, for which he was not eligible.

     -   At  the  Fort Peck Reservation, one participant was
awarded 27,190 pounds  of grain, valued at $1,473, for a 66-
day period.  His first grain  pickup  was on April 15, 1997,
which  entitled him to 16 days of grain  until the April 30,
1997,  Program ending date.  Thus, the participant  received
$1,115 worth of grain for which he was not eligible.

     -   At the Rocky Boy's Reservation, one participant was
awarded 21,125  pounds of grain, valued at $1,131, for a 67-
day period.  He picked  up his entire allotment on April 15,
1997, 30 days before the  May  14,  1997,  Program end date.
Based on the criteria, the participant was entitled  to only
9,459   pounds   of   grain,  valued  at  $506.   Thus,  the
participant received 11,666 pounds of grain, valued at $625,
for which he was not eligible.

Conclusion

The  American  Indian Livestock  Feed  Program,  which  will
replace the Indian  Acute Distress Donation Program, will be
administered directly  by  tribal  governments  through  the
Department of Agriculture's Commodity Credit Corporation and
will not involve the Bureau of Indian Affairs.  Accordingly,
we   are   not   making   recommendations   to  correct  the
deficiencies  in  the  Program  criteria  we  reviewed.   In
addition,  we  are not recommending that the Bureau  recover
the value of the  excess  grain  delivered  to  participants
because  the  participants were not informed that they  were
entitled to obtain  grain  only for the period from the date
of delivery to the date of the  end  of the Program, and the
Bureau  and  the  tribes  informed  applicants  who  had  no
agricultural income that they were eligible for the grain.

On  August  13, 1998, we discussed  a preliminary  draft  of
this  report  with   Billings  Area  Office  officials,  who
generally  agreed with  the  report.   Their  comments  were
considered and incorporated into this report as appropriate.

Since this report  does  not  contain any recommendations, a
response is not required.

The  legislation,  as  amended,  creating   the   Office  of
Inspector  General  requires  semiannual  reporting  to  the
Congress  on  all  audit  reports  issued,  actions taken to
implement audit recommendations, and identification  of each
significant  recommendation  on which corrective action  has
not been taken.

We appreciate the assistance of  Bureau and tribal personnel
in the conduct of our survey.


**FOOTNOTES**

[1]:An acute distress area is defined  as  a  location where the chronic
economic  distress  of needy members of an Indian  tribe  is  materially
increased because of  natural  disaster,  such  as  a flood, drought, or
blizzard.

[2]:Memorandum of Understanding Number 5 specifies 4  pounds  per day of
grain  for  each  cow, bull, or steer; 2 pounds per day for each heifer;
1.33 pounds per day  for  each calf; .8 pounds per day for each sheep or
goat; and .6 pounds per day for each lamb or kid.

[3]:The Chippewa Cree Tribe  has  assumed  responsibility for performing
functions  previously  performed  by  the  Bureau  at  the  Rocky  Boy's
Reservation under a compact between the Secretary and the Tribe pursuant
to the Indian Self-Determination and Education  Assistance  Act  (Public
Law 93-638, as amended).

[4]:The Assiniboine and Sioux Tribes administer the Programs at the Fort
Peck  Reservation  under  a  contract awarded by the Bureau pursuant  to
Public Law 93-638.

[5]:At the Rocky Boy's Reservation,  livestock income, rather than total
agriculture income, was considered in determining Program eligibility.

[6]:The length of the Program varied at  the  three locations because of
differences in application, approval, and Program ending dates.






ILLEGAL OR WASTEFUL ACTIVITIES SHOULD BE REPORTED TO THE OFFICE
OF INSPECTOR GENERAL BY:


Sending written documents to:



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