DEPARTMENT OF JUSTICE STATEMENT
ON S. 2097

Mr. Chairman and Members of the Committee, thank you for inviting the Department of Justice to provide its views on Title II of S. 2097, a Bill to encourage and facilitate the resolution of conflicts involving Indian tribes, and for other purposes.

Introduction

In our work with Indian tribes, the Department of Justice is guided by fundamental principles that have governed the relations between the United States and Indian tribes for over two hundred years. As President Clinton recently explained:

Since the formation of the Union, the United States has
recognized Indian tribes as domestic dependent nations
under its protection. In treaties, our Nation has
guaranteed the right of Indian tribes to self-government.
As domestic dependent nations, Indian tribes exercise
inherent sovereign powers over their members and
territory. The United States continues to work with
Indian tribes on a government-to-government basis to
address issues concerning Indian tribal self-government,
trust resources, and Indian tribal treaty rights and
other rights.

Executive Order No. 13084 (1998).

Congress has recognized that "the United States has a trust responsibility to [Indian tribes] that includes the protection of the sovereignty of each tribal government." 25 U.S.C. § 3601 (2). Under the Federal trust responsibility to Indian tribes, the United States exercises the highest standard of care in matters of tribal self-government.

8. 2097, Title II--Tort Liability Insurance

By way of background, we note that Congress has extended the provisions of the Federal Tort Claims Act ("FTCA") to tribes and their personnel when they are carrying out self-determination contracts. Pub. L. No. 101-512, § 314 (codified as amended at 25 U.S.C. S 450f note (1994)). Other legislation has similarly expanded FTCA coverage to include certain tribal activities. See 25 U.S.C. SS 2802-2804 (the Secretary of the Interior acting through the Bureau shall be responsible for providing or assisting in the provision of law enforcement services in Indian country); Pub. L. No. 100-446 as amended and codified at 25 U.S.C. § 450 (g) (Secretary of Health and Human Services is directed upon the request of any tribal organization to implement hospital and health facility function authorities and responsibilities).

Title II is intended to function as an adjunct to existing FTCA coverage for tribal government functions. The language used in Section 201(b), however, does not mesh with other federal statutes which provided FTCA coverage for tribal activities. This provision would accomplish its goal of listing FTCA coverage as a consideration simply by inserting "by" before chapter and deleting the remainder of the paragraph beginning with "by reason of."1

More generally, Section 201 of Title II would require the Secretary of the Interior to obtain or provide insurance to Indian tribes when certain conditions, set forth in the bill, are met. Section 202 would require the Secretary to conduct a "comprehensive survey of the degree, type, and adequacy of liability insurance coverage of Indian tribes. ." While the comprehensive survey would be quite useful, we do not believe that, the Secretary should be required to obtain or provide insurance for Indian tribes.

In our view, under the principle of Federal government-togovernment relations with Indian tribes, legislation to establish guidelines for tribal insurance should, to the greatest extent practicable, be developed based on consultation and consensus with tribal governments. We believe that comprehensive tribal liability insurance coverage is an appropriate avenue to provide redress for persons injured by tribal governmental activities while preserving tribal sovereignty and financial stability. Rather, than require the Secretary to obtain or provide insurance for tribes, however, it would be preferable for the Attorney General or the Secretary of the Interior to establish guidelines for minimum tribal liability insurance through negotiated rulemaking. Then each Indian tribe could obtain appropriate insurance coverage, or alternatively, participate in an intertribal risk pool or self-insure.

To provide an avenue of redress for persons injured by Indian tribes while according due respect for tribal self-government, legislation establishing guidelines for minimum tribal liability insurance might include the following:

Authorization for the Attorney General or the Secretary of the Interior to establish guidelines for minimum tribal liability insurance, and appropriate exceptions, limits, and conditions on tribal liability, through negotiated rulemaking with Indian tribes;

1 In addition, under Section 201 the insurance provisions are limited to tribal governments that receive funds under the Tribal Priority Allocation (TPA) system. We believe that legislation in this area should be comprehensive in its coverage of Indian tribes, and should not tied to TPA.

Recognition of tribal governmental authority to waive sovereign immunity by the action of the duly authorized tribal governing body;

Authorization of direct actions against the tribe's insurer, if the insured tribe has not waived its sovereign immunity up to the amount of valid and collectible insurance, and prohibit the insurer from raising tribal sovereign immunity as a defense to a claim that falls within its policy coverage;

Recognition of tribal court jurisdiction to adjudicate cases arising within tribal territory against the tribe or its insurer;

Authorization of intertribal insurance corporations under § 17 of the Indian Reorganization Act, 25 U.S.C. § 477, to manage intertribal risk pools as an alternative to commercial insurance; and

Authorization of tribal self-insurance
alternatives to commercial insurance.

programs as

Under this model, the Secretary could "assist" or "help" Indian tribes identify the most cost effective insurance coverage, risk pool, or self-insurance alternative.

Conclusion

In conclusion, we believe that obtaining insurance is a function best left to tribal governments. Rather than require the Secretary to obtain insurance for Indian tribes, legislation that establishes guidelines for minimum tribal liability insurance based on consultation and consensus with Indian tribes is preferable. Such assistance to Indian tribes in identifying cost-effective insurance coverage, in our view, is preferable to a requirement that the Secretary "provide" insurance to Indian tribes.

Mr. Chairman and members of the Committee, my name is Alex Lujan. I am Governor of the Pueblo of Sandia, a federally-recognized tribe in New Mexico. I thank you for this opportunity to offer my comments on S. 2097, "The Indian Tribal Conflict Resolution and Tort Claims and Risk Management Act of 1998."

We believe that the Chairman's bill provides a useful starting point as we continue to work towards resolution of some of the issues, real or perceived, concerning retail transaction taxes and tort claims. While we believe that S. 2097 represents an earnest attempt to balance the competing interests, much more needs to be done before such broad legislation is enacted.

First, S. 2097 impractically deals with two unrelated issues: (1) the collection and payment of retail transaction taxes, and (2) tort liability and insurance. The fact that Titles I and II of the bill basically contain no common provisions is a tacit acknowledgment that they deal with distinct and separate issues. We suggest dealing with each quite important concern separately in order to avoid confusion of the issues, and so that each may be dealt with in a more clear and purposeful manner.

The overbreadth of the bill, we believe, stems in part from the fact that no one yet has any real measure of the "problems" that S. 2097 claims to resolve. We are not aware of any cases of tort claimants left destitute, without any recourse against a culpable tribe, though Title II of S. 2097 seems to proceed on the assumption that this is the norm. Title II of the bill itself acknowledges that it puts the cart before the horse, requiring the Secretary of the Interior "before carrying out the

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requirements of section 201, [to] conduct a comprehensive survey of the degree, type and adequacy of liability insurance coverage of Indian tribes." § 202(a)(1) (emphasis added). We would strongly discourage the consideration of any new rules before the facts are in-hand. If no substantial problems are shown to exist, a law may be unnecessary. A survey, not only of tribal insurance coverage, but also of the resolution of tribal tort claims to date, should be in order before the Committee designs a solution to a problem the extent and even the very existence of which is not yet known.

With regard to retail transaction taxes, S. 2097 again appears to be based on an insufficient foundation and is, as a result, incomplete and in many respects inequitable. Amid all of the "statistics" bandied about by retail trade associations, we have yet to see any hard numbers, presented by an unbiased source, regarding the amount of revenues "lost" to state and local governments as a result of tribes' failure to collect non-tribal retail taxes. We have no idea of how much revenue tribes would be compelled to forgo if required to collect state taxes in full, without

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