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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;


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

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

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Authorization of tribal self-insurance
alternatives to commercial insurance.

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


In conclusion, we believe that obtaining insurance is а 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

Indian tribes in identifying cost-effective insurance coverage, in our view, is preferable to a requirement that the Secretary "provide" insurance to Indian tribes.

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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 11 of the bill itself acknowledges that it puts the cart before the horse, requiring the Secretary of the Interior "before carrying out the

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.


One of the bill's premises is that “many Indian tribes are faced with significant barriers to obtaining liability insurance.” Findings, $ 2(a)(11). This has not been qur experience. The Pueblo of Sandia carried liability insurance long before it was required and has not found insurors at all unwilling to sell us policies. In fact, it is our understanding that many insurance companies, knowing that they can raise the sovereign immunity defense, charge quite low premiums. Of course, this raises different problems, but sertainly contradicts the original premises in the bill's finding. The issue of expensive insurance on one hand and useless insurance on the other might better be addressed in insurance regulations, rather than by a blanket rule for all indian tribes whose individual experiences, needs, and attitudes require thoughtful considerations not enorance



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


offset for tribal taxes on the same transactions. Nor do we know how much tribes will need to expend to do the states' tax collecting.

In a serious oversight, the bill's new Intergovernmental Alternative Dispute Resolution Panel is permitted to hear only claims for the collection of retail taxes owed by an Indian tribe to a state or political subdivision. The Panel's lack of authority to entertain claims regarding tribal taxes is, we feel a glaring omission. Tribes may apparently raise before the Panel only "counterclaims, setoffs, or related claims submitted or filed by the tribe ... regarding the original claim.”

If the purpose of S. 2097 is truly to achieve intergovernmental harmony,” as it states in § 2(b), then it should treat each government similarly and fairly. Tribal taxes, like state and local taxes, should be equally subject to tax compacting under g 101(b), and the same opportunity to bring original claims for the collection and payment of their taxes should be available to tribes. As the Supreme Court indicated in both Cotton Petroleum Corp. v. New Mexico, 460 U.S. 163 (1989) and Washington v. Confederated Tribes of the Colville Indian Reservation, 447 U.S. 134 (1980), the problems raised by double taxation (by the state and by the tribe) are real. S. 2097 should make these problems capable of alternative dispute resolution to achieve

the self-determination that the bill purports to encourage.


The waiver provisions of $ 104(a)(2) should be much more specific as to the nature and scope of such waivers and should specifically require states to waive any Eleventh Amendment defense as well. While Congress may not generally abrogate a state's Eleventh Amendment immunity, Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996), a state can be required voluntarily to waive its immunity in exchange for a tribe's waiver of its immunity.

The principle operative provision of Title I, section 101(1), states that the "compacts and agreements” it envisions are to be consistent with Supreme Court decisions regarding the collection and payment of certain retail taxes of a State or political subdivision thereof.” Rather than open the

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