(b) Reflect the amounts and sources of funds other than Bureau contract funds which may be included in the construction project.

(c) Provide for the creation, maintenance and safeguarding of records of lasting value.

§277.31 Audit and inspection.

(a) During the term of a contract under this part and for three years after the project or undertaking is completed, the Comptroller General and the Secretary, or any of their duly authorized representatives, shall have access, for audit and examination purposes, to any of the contractor's books, documents, papers, and records which, in their opinion, may be related or pertinent to the contract or any subcontract.

(b) The contractor will be responsible for maintaining all documents such as invoices, purchase orders, canceled checks, balance sheets and all other records relating to financial transactions in a manner which will facilitate auditing. The contractor will be responsible for maintaining files of correspondence and other documents relating to the contract properly separated from general records or cross-referenced to general files.

(c) The contractor receiving funds under this part shall be primarily responsible for contract compliance.

(d) The records involved in any claim or expenditure that has been questioned shall be further maintained until final determination has been made on the questioned expenditure.

(e) All contracts, reports, budgets, budget estimates, plans, and other documents pertaining to administration of the contract shall be made available by the contractor. The contractor shall provide information in accordance with the Freedom of Information Act.

$277.32 Freedom of information.

(a) Unless otherwise required by law, the Bureau shall not place restrictions on contractors which will limit public access to the contractor's records except when records must remain confidential.

(b) A contractor under this part shall make all reports and information concerning the contract available to the

Indian people which the contract affects. Reports and information may be withheld from disclosure only when both of the following conditions exist:

(1) The reports and information fall within one of the following exempt categories:

(i) Specifically required by statute or Executive order to be kept secret.

(ii) Commercial or financial information obtained from a person or firm on a privileged or confidential basis.

(iii) Personnel, medical, and similar files where disclosure would be a clearly unwarranted invasion of personal privacy.

(iv) Geological and geophysical information and data concerning wells.

(2) Disclosure is prohibited by statute or Executive order or sound grounds exist for using the exemption given in paragraph (b)(1) of this section.

(c) A request to inspect or copy reports and information shall be in writing and must reasonably describe the reports and information requested. The request may be delivered or mailed to the contractor. Within ten (10) working days after receiving the request, the contractor shall determine whether to grant or deny the request. The requester shall be notified immediately of the determination.

(d) The time limit for making a determination may be extended up to an additional ten (10) working days for good reason. The requester shall be notified in writing of the extension, reasons for the extension, and the date on which the determination is expected to be made.

$277.33 Reporting.

(a) A contractor under this part shall make a detailed report to the Commissioner of Indian Affairs after construction is completed. The report shall include, but not be limited to, an accounting of the amounts and purposes for which the contract funds were expended.

(b) The contractor shall furnish other contract-related reports when and as required by the Commissioner of Indian Affairs.

(c) A contractor under this part shall send copies of the reports required by paragraphs (a) and (b) of this section to the tribe(s) affected by the construc

tion at the same time as the reports are sent to the Bureau.

§ 277.34 Repayment of funds.

Any funds paid under a contract entered into under this part which are not expended, obligated or used for the purposes of the contract during its term shall be returned to the Bureau.

§ 277.35 Penalties.

If any officer, director, agent, or employee of, or connected with, any contractor or subcontractor under this part embezzles, willfully misapplies, steals, or obtains by fraud any of the funds or property connected with the contract or subcontract, he shall be subject to the following penalties:

(a) If the amount involved does not exceed $100, he shall be fined not more than $1,000 or imprisoned not more than one year, or both.

(b) If the amount involved exceeds $100, he shall be fined not more than $10,000 or imprisoned for not more than two years, or both.

$277.36 Applicable procurement regulations

School districts wanting to contract with the Bureau under this part must comply with the applicable requirements in the Federal Procurement Regulations (41 CFR 1), as supplemented by the Interior Procurement Regulations (41 CFR 14) and the Bureau of Indian Affairs Procurement Regulations (41 CFR 14H), except 41 CFR part 14H-70.

[40 FR 51327, Nov. 4, 1975, as amended at 43 FR 37449, Aug. 23, 1978]

§ 277.37 Privacy Act requirements.

(a) When a contractor operates a system of records to accomplish a Bureau function, the contractor shall comply with subpart D of 43 CFR part 2 which implements the Privacy Act (5 U.S.C. 552a). Examples of the contractor's responsibilities are:

(1) To continue maintaining those systems of records declared by the Bureau to be subject to the Privacy Act as published in the FEDERAL REGISTER. (2) To make such records available to individuals involved.

(3) To disclose an individual's record to third parties only after receiving

permission from the individual to whom the record pertains. 43 CFR 2.56 lists exceptions to this procedure.

(4) To establish a procedure to account for access, disclosures, denials, and amendments to records.

(5) To provide safeguards for the protection of the records.

(b) The contractor may not:

(1) Discontinue or alter any established systems of records without prior approval of the appropriate Bureau systems manager.

(2) Deny request for notification or access or records without prior approval of the appropriate Bureau systems manager.

(a) Any contract entered into under this part may be canceled for cause when the contractor fails to perform the work called for under the contract.

(b) Before canceling the contract, the Bureau will advise the contractor in writing of the following:

(1) The reasons why the Bureau is considering canceling the contract.

(2) That the contractor will be given an opportunity to bring its work up to an acceptable level.

(c) If the contractor does not overcome the deficiencies in its contract performance, the Bureau shall cancel the contract for cause. The Bureau will notify the contractor, in writing, of the cancellation. The notice shall give the reasons for the cancellation and the right of the contractor to appeal under subpart C of 43 CFR part 4.

(d) When a contract is cancelled for cause, the Bureau will either perform the work with its own forces or by another contract, as appropriate.

Subpart E-Appeals

$277.51 Contract appeal.

A contractor may appeal an adverse decision or action of a Bureau contracting officer regarding a contract under this part as provided in subpart C of 43 CFR part 4.

$277.52 Appeal from decision to cancel contract for cause.

A contractor may appeal the decision of a Bureau official to cancel a contract under this part for cause. The appeal shall be made as provided in subpart C of 43 CFR part 4.

$277.53 Other appeals.

Any decision or action taken by a Bureau official under this part, other than those given in §§ 277.51 and 277.52, may be appealed only as provided in part 2 of this chapter.

AUTHORITY: 25 U.S.C. 13.

SOURCE: 48 FR 32007, July 13, 1983, unless otherwise noted.

Subpart A-General Provisions $278.1 Purpose.

The purpose of the regulations in this part is to provide the application and approval procedures for the award of economic development grants and for the award of core management grants to small tribes for the strengthening and improvement of tribal governments.

§ 278.2 Definitions.

As used in this part:

(a) Applicant means a tribal governing body or tribal organization applying for a grant under this part.

(b) Area Director means the official in charge of a Bureau of Indian Affairs Area Office.

(c) Assistant Secretary-Indian Affairs means the Assistant Secretary-Indian Affairs who discharges the authority and responsibility of the Secretary for the activities pertaining to Indians and Indian Affairs.

(d) Bureau means the Bureau of Indian Affairs.

(e) Commissioner means the operational head of the Bureau of Indian Affairs, under the direction and supervision of the Assistant Secretary-Indian Affairs, who is responsible for the direction of day-to-day operations of the Bureau of Indian Affairs.

(f) Core management grant means a grant, the purpose of which is to enable small tribes to supplement other resources in order to employ staff to administer tribal affairs and programs as well as Federal programs in a competent and responsible manner.

(g) Economic enterprise means any commercial, industrial, agricultural, or business activity that is established or organized for the purpose of profit.

(h) Economic development grant means a grant for the development, construction, improvement, or operation of tribal facilities or reservation resources for the purpose of profit.

(i) Grant means a written agreement between the Bureau and a tribal governing body or a tribal organization where the Bureau provides funds to

carry out specified programs, services, or activities and where the administrative and programmatic provisions are specified.

(j) Grantee means a tribal governing body or a tribal organization which is responsible for administration of the grant.

(k) Indian means a person who is a member of an Indian tribe.

(1) In kind means assets such as buildings, machinery, equipment or other physical resources which are utilized in the economic enterprise and which are appraised at fair market value by a qualified appraiser.

(m) Multi-tribal organization means a group of two or more tribes banding together to apply for a grant under this Part; the organization must have a governing body with representation from each member tribe and have selected a chairman or other designated head of the organization from among its members.

(n) Non-Federal source means tribal funds, investments from the private sector, or loans from private lending institutions.

(0) Secretary means the Secretary of the Interior.

(p) Small tribe means an Indian tribe with a populatior of 1500 or less Indian people residing on or near the tribe's reservation.

(q) Superintendent means the official in charge of a Bureau of Indian Affairs Agency office.

(r) Tribal government, tribal governing body, and tribal council means the recognized governing body of an Indian tribe.

(s) Tribal organization means the recognized governing body of any Indian tribe; any legally established organization of Indians which is controlled, sanctioned or chartered by such governing body or which is democratically elected by the adult members of the Indian community to be served by such organization and which includes the maximum participation of Indians in all phases of its activities: Provided, That in any case where a grant is made to an organization to perform services benefitting more than one Indian tribe, the approval of each such Indian tribe shall be a prerequisite to the awarding of such grant.

(t) Tribe means any Indian tribe, Band, Nation, Rancheria, Pueblo, Colony, or Community, including any Alaska Native village or regional or village corporation as defined in or established pursuant to the Alaska Native Claims Settlement Act (85 Stat. 688) which is federally recognized as eligible by the U.S. Government through the Secretary for the special programs and services provided by the Secretary to Indians because of their status as Indians.

(u) Tribal resolution means the formal manner in which the tribal government expresses its legislative will pursuant to its organic documents. In the absence of such organic documents, a written expression adopted pursuant to current tribal practices will be acceptable.

§ 278.3 Information collection.

The information collection requirements contained in §§ 278.12, 278.13. 278.17, 278.22, 278.24 and 278.26 have been approved by the Office of Management and Budget under 44 U.S.C. 3501 et seq. and assigned clearance number 10760077 for Economic Development Grants and 1076-0078 for Core Management Grants. The information is being collected to ensure eligibility and grant criteria compliance. The information will be used to determine which applicants will receive grants under this part. Response is required to obtain a benefit.

§ 278.4 Effect on Indian rights.

The regulations in this part are not meant to and do not:

(a) Affect, modify, diminish, or otherwise impair the sovereign immunity from suit enjoyed by an Indian tribe; or

(b) Authorize, require, or permit the termination of any existing trust responsibility of the United States with respect to the Indian people.

$278.5 Request from tribal governing body.

The Bureau shall not make a grant under this part unless specifically and officially requested to do so by a tribal governing body. This request may be in the form of a tribal resolution, an endorsement included in the grant application or such other forms as the tribal

(a) An applicant for a grant, or a grantee, may appeal any decision made or action taken with regard to their application or grant. If the action or decision being appealed is made by an Agency Superintendent, the appeal shall be to the appropriate Area Director. If an Area Director's decision or action is being appealed, the appeal shall be to the Commissioner. The time periods in which appeals may be taken and the appeal procedures to be followed for appeals to Area Directors and the Commissioner are set out in 25 CFR part 2. No appeal lies from the Commissioner's decision, which is final for the Department.

(b) The appellant shall provide its own attorney or other advocates to represent it during the appeal process.

Subpart B-Special Grants for
Economic Development

§ 278.11 Purposes of grants.

In order to strengthen and improve tribal governments, grants shall:

(a) Provide funds for the establishment or expansion of locally determined profit making economic enterprises which generate income and employment opportunities for participating tribes.

(b) Serve as an inducement when combined with a tribe's financial and other resources to attract private sector investment or loans from private lending institutions for the development of the tribe's resources.

(c) Reduce tribal dependence on the Federal Government over the long term through economic development projects which contribute to a stable reservation economy.

§ 278.12 Eligible applicants.

Applications for economic development grants will be accepted only from the governing body of a tribe or a tribal organization which is unable to meet its total financing needs for economic development projects or enterprises from its own resources and/or by loans or equity investment from private, non-Federal sources.

§ 278.13 Application form and content. Applicants for economic development grants will follow the application requirements procedures set forth in Attachment M of the Office of Management and Budget Circular A-102. In addition, each proposal shall include the following:

(a) A concise description of the tribal government organizational structure with emphasis on the political stability and financial responsibility of its operations in recent years. Also describe the relationship between the tribal governing body and planned management of the enterprise, with emphasis on independence of the enterprise from the tribe's political processes.

(b) A plan showing conformity of the proposed project to long range tribal goals.

(c) A schedule for the start and projected completion dates for actions or efforts to implement and maintain operation of the proposed project; include timetable for major purchase of equipment, building construction, production start up and projections as to when the project will reach break even point and become profit making.

(d) Projected work force requirements for a period of three years that will identify management, labor and the technical expertise for the project. Where relevant to the business plan, provide reservation labor force data as