Of $1B settlement, $125M earmarked for Alaska tribes

Attorneys for Indian tribes and the Interior Department announced today an agreement to settle a class-action lawsuit for $940 million. It’s a case that dates back to 1994. Since then, until 2013, the department short-changed some 640 tribes that had federal contracts to provide services to their people. Alaska tribes are among those owed money.

Download Audio

One the one hand, this case is about the mundane overhead costs a tribe incurs when it takes over a federal program. To run a housing office or deliver social services, tribes have to get insurance, buy payroll software, and keep the office lights on. According to their contracts, the government was supposed to cover these administrative support costs.

But the government didn’t. Or didn’t consistently. Anchorage attorney Lloyd Miller, who pursued the case on behalf of tribes, says it’s about contracts, but there’s a bigger principle at play.

“The government gave these contracts discriminatory treatment. It is the only way to explain it. These very agencies, when they would award contracts to other entities would honor those contracts and would go to Congress for the money needed to honor those other contracts, but they never did that with Indian tribes.”

Miller says about $125 million of the settlement will go to 190 Alaska entities, some of them small tribes and some regional non-profits, like Tanana Chiefs Conference and the Association of Village Council Presidents. If a judge approves the settlement, the money could begin to flow to the tribes next year. Miller has also settled similar cases over contract support costs for tribal health care.

At the heart of both is the Indian Self-Determination Act of 1975. Before then, the federal government provided the services.

“Fifty years ago, my elders tell me everything on the reservation was controlled by the Bureau of Indian Affairs, from where we lived to where we were buried.”

That’s one of Miller’s non-Alaska clients, Val Panteah, governor of the Pueblo of Zuni. At a Justice Department press conference announcing the settlement, the Zuni leader said it all changed when, under the Indian Self-Determination Act, tribes started contracting to do the work themselves.

“But the federal government found a way to undermine this process, too. They cheated us on our contracts.”

At the U.S. Supreme Court, the government argued it couldn’t pay the tribes’ their due, because starting in the 1990s, Congress — worried about the rising bills — set firm caps on the contract support costs. Much of the case was about the conflict between those statutory caps, and what the department promised the tribes in each contract.
The current head of the BIA, Interior Undersecretary Kevin Washburn, applauded the outcome of that case, and the new agreement.

“Today’s proposed settlement reflects the Obama administration’s effort to get the United States to fully embrace tribal self-determination. The tribal leaders, and their smart and very persistent lawyers, deserve credit for turning the United States around on this principle, by winning a major case in the United States Supreme Court in 2012.”

Since 2013, Congress has fully funded contract support costs. Washburn says the administration is now pushing Congress for permanent, mandatory funding for those portions of the contracts.