REPORT TO THE SUBCOMMITTEE

ON THE DEPARTMENT OF
INTERIOR AND RELATED

AGENCIES, SENATE COMMITTEE

ON APPROPRIATIONS

CONTROLS ARE NEEDED OVER
INDIAN SELF-DETERMINATION
CONTRACTS, GRANTS, AND
TRAINING AND TECHNICAL
ASSISTANCE ACTIVITIES TO
INSURE REQUIRED SERVICES
ARE PROVIDED TO INDIANS

DIGEST

The Bureau of Indian Affairs, Department
of the Interior, does not have adequate
controls over self-determination contracts
and grants awarded to Indian tribes or the
related training and technical assistance
activities. Thus, the Bureau does not know
whether the tribes are providing required
services to Indians or if training and tech-
nical assistance funds are being properly
used. (See pp. 4 and 16.)

CONTROLS NEEDED OVER

CONTRACTS AND GRANTS

Neither the Indian Self-Determination Act
nor regulations define the extent of con-
trol the Bureau should exercise over pro-
grams and services administered by tribes
under contracts and grant agreements.
How-
ever, the act clearly mandates that tribal
performance under contracts and grants must
be supervised. The Bureau has not met this
mandate even though self-determination con-
tracts and grants in fiscal year 1977
accounted for about 25 percent of its budget
for the operation of Indian programs.

Contracts and grants were awarded retroac-
tively--that is, the starting dates preceded
the dates of award--and adequate criteria
against which to measure tribal performance
were not always included. Supervision and
monitoring of contracts and grants was not
effective in identifying and helping improve
tribal performance. (See p. 4.) It is
difficult to identify individual contracts
and grants and how training and technical
assistance funds are being used because the
Bureau has not developed a management

Tear Sheet. Upon removal, the report cover date should be noted hereon.

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CED-78-44

reporting system to help monitor and control these activities. (See pp. 4 and 18.)

Bureau guidelines do not adequately define the duties of employees assigned to supervise and monitor contracts. This fact along with the designation of employees at the agency 1/ level has created a situation that makes it difficult for the employees to effectively monitor tribal performance. They are required to supervise and monitor contracts and grants as part-time, collateral duties with very little training. They are not able to maintain the independence needed to effectively supervise and monitor tribal performance because they work for or with the tribes on many other matters. (See pp. 6 to 8.)

On October 1, 1976, the Bureau awarded a $4 million contract to a tribe to operate a higher education scholarship program in fiscal year 1977, even though tribal auditors reported that the tribe had not been able to properly operate the program. The auditors raised serious questions concerning negligence and mismanagement in the handling of funds provided to the tribe. They reported that about $161,300 in overpayments had been made to Indian students as well as other management deficiencies. In spite of the tribe's past performance, the Bureau as of November 1977 had not taken steps to determine current tribal performance or whether the deficiencies had been corrected. The Bureau extended the contract for fiscal year 1978 at an estimated cost of $3.8 million. (See pp. 9 to 11.)

The Secretary of the Interior needs to correct the management deficiencies found in this and other cases.

1/Agencies are generally located near tribal offices and handle the area office's dayto-day contact with one or more tribes.

Tear Sheet

CONTROLS NEEDED OVER

TRAINING AND TECHNICAL
ASSISTANCE ACTIVITIES

The act intended that training and technical
assistance to tribes be directed toward
(1) increasing tribal capability to contract
for programs now provided by the Bureau and
(2) helping tribes overcome problems that
could cause denial of their requests for con-
tracts. The Bureau is also authorized to use
training and technical assistance funds for
activities related to implementing the act
such as training of Bureau and tribal
employees.

However, the Bureau permits the use of such
funds for other purposes. In one instance
an area office awarded a contract to a uni-
versity to provide technical assistance to
Indian tribes. The funds under the contract
were used to improve economic development
enterprises. A headquarters official ad-
vised the area office in December 1977 that
the funds should not have been used for this
purpose. However, Bureau guidelines were not
clear and as a result, the area office applied
a very liberal interpretation of how technical
assistance funds could be used. (See pp. 19
to 20.)

Concerted effort is needed to develop adequate controls over Indian self-determination contracts, grants, and training and technical assistance activities. Controls are necessary to make sure that (1) the service to be rendered to Indian beneficiaries of the particular program or function operated by tribes under contracts or grant agreements is satisfactory, (2) protection of trust resources is assured, and (3) the program or function is properly operated and completed.

RECOMMENDATIONS

The Secretary of the Interior should direct the Assistant Secretary for Indian Affairs to develop a management reporting system to help monitor and control self-determination contracts, grants, and training and technical assistance activities. The Assistant

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Secretary should also be directed to revise the Bureau's policies, regulations, procedures, and practices as appropriate to:

--Prohibit award of contracts in which the starting date precedes the date of award.

--Require that all contracts and grants include specific criteria against which to measure performance.

--Require that contracts and grants are effectively supervised and monitored by contract and grant officers. This should include (1) designation of full-time contract and grant officer representatives at the area level rather than agency level in order to remove conflict of interest, (2) clear description of contract and grant officer representative responsibilities, and (3) adequate training of contract and grant officer representatives.

--Prevent training and technical assistance funds appropriated for self-determination purposes from being used for assistance

t does not help tribes (1) develop the ability to negotiate and administer selfcermination contracts and grants or (2) improve their managerial and governmental capabilities required to fully exercise their self-determination options. (See pp. 15 and 21.)

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