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NATIONAL TRIBAL CONTRACTSUPPORT COST COALITION
BIA Tribal Budget Advisory Committee Meeting, March 2010
Bureau ofIndian Affairs
Tribal BudgetAdvisory
Committee Meeting
March 8, 2010
Washington, D.C.
CONTRACT SUPPORT COSTS UNDER THEINDIAN SELF-DETERMINATION ACT
PRESENTED BY:
LLOYD B. MILLER, LEGAL COUNSEL1425 K STREET NW, SUITE 600
WASHINGTON, D.C. 20005PHONE: (202) 682-0240
FACSIMILE: (202) 682-0249
2
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
EssentialGovernmental
Services
Under the Indian Self-Determination Act, Indian Tribes carry out essential governmental services such as health care, law enforcement, housing education, and other programs that the BIA and IHS would otherwise carry out in Indian country.
BIA Tribal Budget Advisory Committee Meeting, March 2010
3
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
All Tribes in 35 States
Every Tribe in 35 States operates one or more self-determination contracts, from substance abuse programs to entire hospitals and police forces.
BIA Tribal Budget Advisory Committee Meeting, March 2010
4
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Impacts and
Transparency
Self-determination contracting has strengthened tribal institutions, increased local employment, and reduced the federal bureaucracy.
It is also fully transparent through independent annual audits.
BIA Tribal Budget Advisory Committee Meeting, March 2010
5
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
FixedCosts
“Contract support costs” (CSCs) for ISDA contractors cover the independently-audited fixed overhead costs that an ISDA contractor must incur to operate an IHS or BIA facility or program (i.e., insurance; annual audits; payroll administration, etc.).
BIA Tribal Budget Advisory Committee Meeting, March 2010
6
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
IDCRates
CSC’s are equivalent to “general and administrative costs” (G&A) required by government procurement contractors. Both costs are generally set by indirect cost rates that are issued by the federal government.
BIA Tribal Budget Advisory Committee Meeting, March 2010
7
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
LostJobs
CSC shortfalls cost jobs. Since contract support costs are fixed, tribal contractors must cover shortfalls in CSC payments by reducing funding intended for services through personnel reductions.
BIA Tribal Budget Advisory Committee Meeting, March 2010
8
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
DollarFor
DollarReductions
Every dollar in CSC shortfalls leads to reduced services and positions, and (for IHS contracts) also reduced collections from Medicare, Medicaid and private insurance (all of which fund additional services and positions).
All told, every $10 million in lost CSC payments means 243 fewer health care jobs (including jobs that would be paid with third party collections), and at least 100 fewer jobs in BIA-funded government programs.
BIA Tribal Budget Advisory Committee Meeting, March 2010
9
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
The ISDAPenalty
CSC payment shortfalls penalize Tribes and their members for carrying out the Nation’s most successful initiative to strengthen Indian communities, by forcing program and personnel reductions.
BIA Tribal Budget Advisory Committee Meeting, March 2010
10
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Unfairness
Due to CSC shortfalls, tribally administered BIA and IHS facilities end up with less funding and fewer personnel than non-contracted BIA and IHS facilities providing the same services.
BIA Tribal Budget Advisory Committee Meeting, March 2010
11
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Cherokeev.
Leavitt
In Cherokee Nation v. Leavitt the Supreme Court held the United States liable for IHS’s failure to pay full CSCs in fiscal years 1994-1997. The Court reasoned that ISDA contractors have no fewer rights to be paid than do other government contractors.
BIA Tribal Budget Advisory Committee Meeting, March 2010
12
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Immediate Obligation
Appropriations for CSCs can be obligated to Tribes under existing contracts, within 10 days of apportionment to the BIA and IHS. CSCs directly fund jobs, and those jobs directly enhance services for health care, education, law enforcement and other essential governmental services across Indian country.
BIA Tribal Budget Advisory Committee Meeting, March 2010
13
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
$64MBIA
Shortfall
The BIA projected shortfall for FY 2011 is $64 million (excluding the President’s proposed increase).
Absent any increases, IHS projects an FY 2011 shortfall of $150 million.
BIA Tribal Budget Advisory Committee Meeting, March 2010
14
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Magnitudeof the
Shortfall
The FY 2011 unpaid CSCs represent only 1.9% of the total BIA appropriation for Operation of Indian Programs.
BIA Tribal Budget Advisory Committee Meeting, March 2010
15
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Pacing
A plan should be developed to close the CSC funding gap within 2 years for the BIA and within 3 years got IHS.
BIA Tribal Budget Advisory Committee Meeting, March 2010
16
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
CSC Impact
Statements
Future program increases should include CSC impact statements (currently estimated at 10.6 cents for each dollar added to Operation of Indian Programs).
BIA Tribal Budget Advisory Committee Meeting, March 2010
17
CONTRACT SUPPORT COSTS UNDER THE INDIAN SELF-DETERMINATION ACT
Discrimination Against Indian
Contractors
The President and Congress should not permit Indian contracts to remain the only government contracts that go unpaid. Deliberately underpaying government contracts with Tribes raises grave constitutional issues.
BIA Tribal Budget Advisory Committee Meeting, March 2010
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Projections of BIA Contract Support Cost Shortfall in 20081. 2008 OIP appropriation $2,080,261,000
2. less 2008 CSC appropriation [$149,628,000]
3. net 2008 OIP appropriation [excluding CSC dollars] (1-2) $1,930,633,000
4. total 2008 OIP under contract (per BIA 08 SF report) $619,476,520
5. % OIP under contract to total OIP (4÷3) 32%
6. total 2008 CSC requirement (per BIA 08 SF report) $204,075,690
7. relation of CSC to OIP under contract (6÷4) 33%
8. relation of total CSC requirement to total OIP apportion [excluding CSC dollars] (6÷3)
10.6%
This tells us that in FY 2008, an amount equal to 32% of the total OIP $$$ [excluding CSC dollars] was contracted to Tribes, and of that sum, an additional 33% as needed to pay full CSC.
That means 33% of 32% of total OIP dollars [excluding CSC dollars] is the annual CSC requirement. That’s 10.6% of total OIP dollars [excluding CSC dollars].
BIA Tribal Budget Advisory Committee Meeting, March 2010
19
Projections of BIA Contract Support Cost Shortfall in 2009
BIA Tribal Budget Advisory Committee Meeting, March 2010
9. 2009 OIP appropriation $2,128,630,000
10. less 2009 CSC appropriation [$147,294,000]
11. net OIP appropriation [excluding CSC dollars] (9-10)
$1,981,336,000
12. projected 2009 CSC requirement (10.6% x 11) $210,021,610
13. less 2009 CSC appropriation (10) [$147,294,000]
14. 2009 projected shortfall (12-13) $62,727,610
20
Projections of BIA Contract Support Cost Shortfall in 2010
BIA Tribal Budget Advisory Committee Meeting, March 2010
15. 2010 OIP appropriation $2,335,965,000
16. less 2101 CSC appropriation [$166,000,000]
17. net 2010 OIP appropriation [excluding CSC dollars] (15-16)
$2,169,965,000
18. projected CWC requirement (10.6% x 17) $230,016,290
19. less CSC appropriation in 2010 (16) [$166,000,000]
20. 2010 projected shortfall (18-19) $64,016,290
21
Projections of BIA Contract Support Cost Shortfall in 2011
BIA Tribal Budget Advisory Committee Meeting, March 2010
21. proposed 2011 OIP appropriation $2,394,640,000
22. less proposed 2011 CSC appropriation [$187,526,000]
23. 2011 OIP appropriation [excluding CSC dollars) (22-21)
$2,207,114,000
24. projected CSC requirement (10.6% x 23) $233,954,000
25. less proposed CSC appropriation (22) [$187,526,000]
26. 2011 projected shortfall (24-25) $46,428,000
22
Projections of BIA Contract Support Cost Shortfall for 2012
BIA Tribal Budget Advisory Committee Meeting, March 2010
27. Projected 2012 OIP appropriation (2.527%) $2,455,152,553
28. less proposed 2011 CSC appropriation (22) [$187,526,000]
29. 2012 OIP appropriation [excluding CSC dollars) (28-29)
$2,267,626,553
30. projected CSC requirement (10.6% x 29) $240,368,415
31. less proposed CSC appropriation (28) [$187,526,000]
32. 2012 projected shortfall (30-31) $52,842,415
23
Projections of BIA Contract Support Cost Shortfalls in 2008, 2009, 2010, 2011 & 2012
BIA Tribal Budget Advisory Committee Meeting, March 2010
33. 2008 CSC shortfall (reported by BIA) $57,730,229
34. 2009 CSC shortfall (projected) (14) $62,727,610
35. 2010 CSC shortfall (projected (20) $64,016,290
36. 2011 CSC shortfall (projected) (26) $46,428,000
37. 2012 projected shortfall (30-31) $52,842,415
24
FY 2011 Shortfall Percentages
FY 2011 appropriations ÷ $187,526,000 = 92% FY 2008 requirement ÷ $204,075,690 FY 2011 appropriations ÷ $187,536,000 = 80% FY 2011 requirement ÷ $233,954,000
BIA Tribal Budget Advisory Committee Meeting, March 2010
25
CONTRACT SUPPORT COSTS UNDERTHE INDIAN SELF-DETERMINATION ACT
If you have any questions or comments, please contact:
BIA Tribal Budget Advisory Committee Meeting, March 2010
National Tribal Contract Support Cost Coalition
Alaska Native Tribal Health ConsortiumArctic Slope Native Association, Ltd.
Cherokee NationChippewa Cree Tribe of the Rocky Boy’s Reservation
Choctaw NationConfederated Salish and Kootenai Tribes
Copper River Native AssociationForest County Potawatomi Community
Kodiak Area Native AssociationLittle River Band of Ottawa Indians
Pueblo of ZuniRiverside – San Bernardino County Indian Health
Shoshone Bannock TribesShoshone-Paiute Tribes
Spirit Lake TribeYukon-Kuskokwim Health Corporation
Lloyd B. Miller
1425 K Street, NW, Suite 600Washington, D.C. 20005
Phone: (202) 682-0240Facsimile: (202) 682-0249
900 West Fifth Avenue, Suite 700Anchorage, AK 99501Phone: (907) 258-6377
Facsimile: (907) [email protected]