IMPLEMENTATION OF THE TRIBAL SELF- WEDNESDAY, OCTOBER 20, 1993 U.S. SENATE, COMMITTEE ON INDIAN AFFAIRS, The committee met, pursuant to notice, at 9:30 a.m. in room 485, Russell Senate Office Building, Hon. John McCain (vice chairman of the committee) presiding. Present: Senators McCain, Cochran, Campbell, Murkowski, and Wellstone. STATEMENT OF HON. JOHN MCCAIN, U.S. SENATOR FROM ARIZONA, VICE CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS Senator MCCAIN. Good morning. I want to welcome you all here this morning. Chairman Inouye wanted very much to be here this morning, but he is currently managing the Defense Appropriations Bill on the Senate Floor. As many of you know, he is the chairman of the Defense Appropriations Subcommittee and we have been involved in spirited debate for the last 4 or 5 days. I am sure he would much rather be here than there. Chairman Inouye, of course, was one of the original congressional visionaries for the potential of self-governance to better define the Federal/Indian relationship. Today's hearing will focus on the implementation of the Self-governance Demonstration Project Act by the Bureau of Indian Affairs and the Indian Health Service. We will discuss some of the obstacles as well as some of the successes of the project since its enactment in 1988. For the past 2 days, a number of the self-governance tribes have been meeting here in Washington, DC to discuss establishing the project on a permanent basis. To assist with those deliberations, I provide the tribes with a draft bill that would make the program permanent for the Department of the Interior with the full intention of including the Indian Health Service at a later date. I would be interested in any comments the tribes might have on this draft bill as well as your own ideas on what should be included in permanent legislation. I believe this project has been a success and deserves to be established as a permanent option for all tribes. To fulfill our solemn treaty obligations and to give real meaning to the policy of Indian self-determination, I believe the Congress and the Executive Branch must work together to see that we do everything in our power to allow the tribes to govern themselves and to dispense their own funds in the best manner in which they see fit. As Joe DeLaCruz, president of the Quinault Indian Nation stated, No right is more sacred to a nation, to a people, than the right to freely determine its own social, economic, political, and cultural future without external interference. The fullest expression of this right occurs when a nation freely governs itself. I would like to point out that there is already a vote scheduled at 10:30 this morning. I have an amendment on the Floor following that. I will try to get someone to take over the hearing during that period. If not, we may have to stand in recess for a relatively brief period of time. Before we call our witnesses, I would like to ask my friend, Ben Nighthorse Campbell, if he has any opening comments. STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. Senator CAMPBELL. I would just ask unanimous consent to introduce something in the record, Mr. Chairman. I have a conflict as well, so I can only stay for a few minutes. I would prefer to save that time for people who are here to testify. Thank you very much. Senator MCCAIN. Without objection, your prepared statement will appear in the record. [Prepared statement of Senator Campbell appears in appendix.] Senator MCCAIN. I would like to call our first witnesses, Michael Lincoln, Acting Director of the Indian Health Service, and William Lavell, Director of the Office of Self-Governance, Bureau of Indian Affairs. Welcome, gentlemen. Thank you for joining us here this morning. As you know-and as I would like to inform all the witnessesyour complete statements will be made a part of the record. If you choose to summarize your statement, you are free to do so. If you choose to give your entire statement, you are also free to do so. Mr. Lincoln, we will begin with you this morning. Welcome. STATEMENT OF MICHAEL LINCOLN, ACTING DIRECTOR, INDIAN HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN SERVICES, ROCKVILLE, MD Mr. LINCOLN. Thank you, Mr. Chairman. It is our privilege to be here in front of the committee today. I will not go through the entire statement. We will submit that for the record, but I would like to summarize some of that statement for those points we think most important. I am joined today by Reuben Howard, who is the acting director of our Office of Self-Governance, and Douglas Black, who is the associate director of our Office of Tribal Activities. Under his leadership, over the past year he has guided our self-governance activities. The Indian Health Service was afforded self-governance demonstration authority just over 1 year ago. In that period of time, we believe much accomplishment has occurred. There have also been many stumbling blocks that we need to work through. I would like to summarize a little bit of that accomplishment. We have signed 14 self-governance agreements with tribal governments that are effective this fiscal year, 1994. These 14 agreements transfer almost $50 million to tribal governments, $7 million of which are what is called tribal shares. These tribal shares are Indian Health Service administrative funding from our headquarters office and from our area offices where these compacts were negotiated. We believe this is a marker in terms of complying with the intent of title III of Public Law 93-638. The Indian Health Service will provide $4 million of tribal shares from the organization, the remainder to be financed using the anticipated appropriation for the self-governance shortfall funding, which is approximately $3 million. Our appropriation was marked up by the Conference, I understand, a couple of days ago. We believe these funds are in that appropriation. Implementing self-governance in the arena of health cannot occur in isolation of some of the more recent events and recent documents that will be coming forward to the Congress. There are many, many bills in front of the Congress now regarding health care reform in some form. We believe that as we look at health care in Indian country, not only those services provided by the Indian Health Service but through title I contracts and through Title III self-governance compacts, that we must take into account and start anticipating the impact of the national health care reform effort on our health delivery systems. In addition, there has been a report called "The National Performance Review" issued by the vice president. The reinventing government ideas, the downsizing, the expanding the span of control that administrators may be experiencing-at least in the Federal Government-are all factors that will impact on our ability to provide adequate, excellent services to Indian people. The Indian Health Service will be absorbing a $9.4 million reduction in administrative costs in fiscal year 1994, consistent with the President's proposal and concurrent approval by the Congress. The combination of a $9.4 million reduction and the proper absorption of tribal shares at the area and headquarters, will cause the Indian Health Service to take a serious look at how best those administrative reductions can occur. To this end, the Indian Health Service has appointed a small working group composed of tribal representatives and key Indian Health Service staff to start overseeing the effort to appropriately absorb these administrative reductions. We have established an Office of Self-Governance with the Indian Health Service. This is one of those areas where I believe the Indian Health Service could be accused of not moving quick enough. In essence, we have had the authority for a year and we have had appropriations for 1 year. We have assigned some of our best staff in acting capacities to carry out the intent of the Office of Self-Governance. We believe we had done that well, but it is now time to put a permanent staff on board. Just yesterday, the directorship of the Office of Self-Governance advertisement closed. We will be working with the self-governance tribes to establish a process for their review of qualified applicants for that position. We would expect, certainly, a recommendation from those tribes as to how the permanent director of the Office of Self-Governance would be. In general, Mr. Chairman and Senator Campbell, we support the principles of self-governance that have been outlined in Title III of the Indian Self-Determination and Education Assistance Act. We believe that there has been great learning by the Indian Health Service over the past year and we believe there is so much more to learn this coming year. We expect to have a partnership relationship, a government-to-government relationship, with the self-governance tribes. We look forward to this next phase of this partnership. Thank you, Mr. Chairman. [Prepared statement of Mr. Lincoln appears in appendix.] Senator MCCAIN. Thank you. Mr. Lavell, welcome. STATEMENT OF WILLIAM LAVELL, DIRECTOR, OFFICE OF SELFGOVERNANCE, BUREAU OF INDIAN AFFAIRS, DEPARTMENT OF THE INTERIOR, WASHINGTON, DC Mr. LAVELL. Thank you, Mr. Chairman. I am William Lavell, Director of the Office of Self-Governance. I will be delivering the statement of Ada Deer, Assistant Secretary for Indian Affairs, who is unable to be here today due to a prior commitment in Albuquerque. Since she is not here, I would like to read her statement into the record. Mr. Chairman, since my confirmation hearing, I have taken the reigns of Indian Affairs, and I must say that there are many horses on this team and not all are pulling in the same direction. I aim to change that. Also, since my confirmation hearing, Vice President Gore has issued the national performance review report entitled “Čreating a Government that Works Better and Costs Less". The self-governance demonstration project fits perfectly into this model. Things will work better as tribal sovereignty is enhanced with tribal governments assuming greater control over the use of Federal resources. Programs can now be designed and delivered by tribal governments with the ultimate customers clearly in mind—individual Indians living on various reservations throughout the country or in Alaska villages. Further, as tribal governments assume more responsibility for managing their share of the Federal budget, there will be a reduced need for Federal staff. This will assist the BIA in meeting targeted FTE reductions and administrative cost savings. As I indicated in my confirmation statement to you in July, Secretary Babbitt and I want to accelerate the trend toward self-governance and at the same time respect the rights of those tribes who choose a different course. Thus, while many tribes are reinventing their relationship with the Federal Government, other tribes have chosen to maintain their current relationship. It is critical that support for non-participating tribes be maintained. I applaud the many tribal leaders and Members of Congress who have worked very hard, first, to pass the necessary legislation and, since then, to implement the self-governance objectives. Their hard work has achieved remarkable results as many different kinds of tribes have come forth to participate in the demonstration project. In 1993, 19 tribes and consortiums operated programs under self-governance annual funding agreements with total direct program resources of about $60 million which represents just under 10 percent of all BIA funds contracted or granted to tribes under the provisions of Public Law 93-638. These annual funding agreements ranged from a low of $530,000 to a high of $10.6 million. In 1994, we anticipate that 28 tribes and consortiums will have annual funding agreements totalling approximately $100 million. These tribes and consortiums represent 9 of the 12 BIA areas. The results of the project to date have been very positive. Tribal leaders from selfgovernance tribes indicate greatly increased flexibility in directing resources toward tribal priorities and needs. They describe a much greater level of interest in tribal council sessions, particularly budget sessions where tribal priorities are set. These leaders also report evidence of a new attitude by tribal program managers and staff as they take a more active role in the design and execution of tribal programs rather than simply being vendors of the BIA. As Wilma Mankiller, principal chief of the Cherokee Nation, has stated: "The self-governance project has served to achieve the goal of real self-determination. As the 20th century closes, the Cherokee Nation has reassumed its place in the family of American governments." What excites me about self-governance is that the decisions are being made by those most directly affected by the decisions. This is the way it was for hundreds of years for the many Indian nations prior to the arrival of the Europeans. There are a few remaining issues yet to be settled. Some of these include: Settling on a process to determine tribal shares of the BIA budget; determining if any changes are needed that would allow the Secretary's trust responsibility to be fulfilled in a more flexible manner and then determining the support necessary to perform these retained trust functions; creating an efficient process to waive BIA rules and regulations to expedite program redesign; and developing regulations that will flesh out other parts of the project that require attention. While I do not yet have answers to these and other questions, I can say it is my full intent to implement the self-governance project consistent with the laws that authorize it. In essence, these laws direct me to look for ways to include, not exclude, funds from all programs, functions or activities that benefit Indian tribes either directly or indirectly into the self-governance negotiations. This, however, must be tempered by the fact that as an executive branch agency, the BIA will always have a responsibility for certain inherent Federal functions that cannot be contracted or compacted to tribes. To this end, I will form a study team that will be headed by one of my senior staff members to study these issues. Further, I intend to support tribal governments in their effort to redesign programs to meet their own unique circumstances by accelerating the regulation waiver review process. Tribal leaders have just finished a 2-day conference in which they have considered what should be included in legislation to make self-governance a permanent option for those tribes that desire such a government-to-government relationship. I believe that it is time for the tribes, the Congress, and the administration to work together on the specifics of such legislation that will provide self-governance as a permanent option. One of the strengths of the self-governance demonstration project is that it has remained a tribal initiative and I want to continue to support this undertaking. Where self-governance can be implemented through administrative procedures, then I favor this. There is still much to be learned about the possibilities and road blocks from this demonstration project. These can be addressed more efficiently by adjusting a procedure or policy rather than legislatively locking in a certain concept or process. I know the tribes and the Congress are concerned about BIA restructuring in response to resources and responsibilities being shifted to self-governance tribes. The Senate Appropriations Committee has directed the BIA to submit a detailed report on the impacts of contracting and compacting for every program at every agency and area. This will provide a good foundation for future decisionmaking. I want to explore ways in which tribal governments, who are the beneficiaries of tribal trust assets, can play a greater role in the management of trust programs. With the passage of Public Law 93-638 and more recently Public Law 100-472, which includes provisions for the self-governance demonstration project, Congress has authorized participation by the tribes in the administration of the trust programs. It is important to me that while we not lesson our trust responsibility, we take advantage of this participatory component. In meeting this trust responsibility, I see us moving increasingly away from actual resource management to trust oversight. Conducting annual trust assessments jointly with the tribal governments and the BIA has been a step in that direction. In summary, what we are doing is having self-governance be the lead horse that will guide the other horses in reinventing that portion of the Federal Government dealing with Indian people. I am sorry that I was unable to attend your hearing and I look forward to a continuing partnership with the self-governance tribes and the Congress as this demonstration project unfolds. To this end, I support the continuation of the Self-Govern |