Tribal Self-Governance Health Care and Social Services Delivery Effectiveness Evaluation Feasibility Study: Legislative History and Development of Tribal Self-Governance and Contracting - Revised Report. 4.2 Indian Self-Determination and Education Assistance Act (59)


The legislative history of the Indian Self-Determination and Education Assistance Act shows that Congress intended to provide a mechanism for facilitating the assumption of control by Tribes over Federal programs and services, without fear of termination. The purpose of Senate Bill 1017 (1974) was to "implement a policy of self-determination whereby Indian Tribes are given a greater measure of control over programs and services provided to them by the Federal government". (60) Senator Abourezk stated, "Central to the theme of this mechanism is the possibility for the Indian Tribe to bring about changes without fear of termination." (61) The idea of giving Tribes greater control over programs and services with the freedom to make changes seemed to contemplate a reality different from one in which tribal contractors would be required to operate programs in the same way as the Federal government. The House of Representatives also seemed to view the Act as providing flexibility to overcome existing statutory restrictions. (62)

Illustrative of these problems is the inability of the Federal government to exempt tribal contracts from Federal Procurement Regulations and to authorize payments in advance of tribal performance on such contracts…a more flexible authority is needed in order to give substance and credibility to the concept of Indian self-determination. Title I of S.1017 provides this flexible authority to efficiently and realistically permit contracting of…Indian Health Service programs…The rigid procurement and contracting laws and regulations of the Federal government are either made inapplicable to such contracting or can be waived in the discretion of the respective Secretary. (63) (64)

The Indian Self-Determination and Education Assistance Act (ISDEA) became law on January 4, 1975. (65) ISDEA Section 103 directed the Secretary of DHEW to enter into a contract or contracts with any tribal organization or any such Indian Tribe to carry out any or all of his functions, authorities, and responsibilities. (66) ISDEA Section 104(a) authorized the Secretary to make contracts or grants to strengthen tribal government; improve tribal capacity to contract; to acquire land to support the grant; and to plan, design, monitor, and evaluate Federal programs that serve the Tribe. Section 104(b) authorized the Secretary to make grants for development, construction, operation, provision, or maintenance of adequate health facilities or services, and for planning, training, evaluation or other activities designed to improve the capacity of a tribal organization to enter into a contract under Section 103.

Essentially, Section 103 authorized contracts to perform any of the Secretary's functions, authorities and responsibilities, although a Federal grant or cooperative agreement could be used in lieu of a contract. ISDEA Section 104 authorized contracts or grants to strengthen and improve the contracting capacity of tribal governments as well as to assist them in planning and designing their own programs and grants to construct or operate health facilities, and tribal capacity building activities related to future performance on a Section 103 contract.

Section 106, Administrative Provisions, required that Section 103 contracts be in accordance with all Federal contract laws and regulations. (67) Section 106 also provided for a waiver of contracting laws and regulations as they might apply to a Section 103 contract, in the discretion of the Secretary, if the Secretary determined that the law or regulation was not appropriate for the purposes of the contract or was inconsistent with the ISDEA. (68) The administrative provisions of ISDEA Section 106(g) also provided that rulemaking under Section 107 should include provisions to assure the fair and uniform provision of services and assistance provided under ISDEA grants and contracts.

Section 5, Reporting and Audit Requirements, imposed minimal reporting requirements for contracts and grants. Section 5 did not require that reporting conform to any particular standard or format. The only requirement was that sufficient financial records be kept to make auditing of the Federal financial assistance possible. Minimal reporting under Section 5 is consistent with the intent of Congress to either eliminate rigid procurement and contracting laws and regulations or to provide for their waiver, since procurement laws generally require more extensive reporting. (69) Reporting and auditing requirements based in procurement law and regulations are much more stringent than are program auditing standards which report on object-level financing.

Section 107, Promulgation of Rules and Regulations, applied to the entire Act. While the ISDEA did not make Section 104(a) or Section 104(b) subject to the application of Federal contract laws and regulations, it is noteworthy that the published regulations implementing Section 104 selectively incorporated procurement standards, uniform administrative requirements, cost principles, and construction and equipment standards into the regulations and applied them to Section 104(a) contracts and to Section 104(a) and (b) grants. (70) ISDEA Section 3 declaration of policy had called for meaningful participation by Tribes to plan, conduct, and administer programs and services that were responsive to their needs, not to the needs of the government to have programs operated in the same way. Section 104(a)(4) had even offered contract assistance to "design" programs that would be responsive to local needs. At the time, however, published grant regulations required that services be provided according to IHS regulations (71) and be compatible with IHS goals and responsibilities. (72) Neither the contract and grant requirements of Section 104 nor the reporting and audit requirements of Section 5 required that tribal contractors provide services according to IHS regulations. Similarly, the administrative provisions did not require Tribes to provide substantial justification for their Section 103 requests to waive Federal contracting laws and regulations. (73)

Section 103, Contracts, also provided for appeals of declinations made by the Secretary. Under Section 103, the Secretary could decline to contract if he found that contracting of a service or function would not be satisfactory, or that protection of trust resources would not be assured, or that the contracted project or function would not be completed or maintained. A number of factors were to be used to assess potential deficiencies. The Secretary was required to state his objections in writing, provide technical assistance to the Tribe to overcome his objections, and provide for a hearing and appeal under rules he would prescribe.

For contracts under Section 104(a), and for grants under Section 104(a) and Section 104(b), no declination criteria were provided. Since there were no declination criteria under Section 104 for contracts or grants, a decision to avoid contracting or to deny a grant could be made under the Secretary's discretionary authority. Since the Secretary did not have to make the contract or grant, the only practical alternative afforded to Tribes was to accept government guidance on how to develop and operate their tribal health programs. Only its rescission could be appealed after a grant had been made. Under Section 109, reassumption of Programs, the Secretary could rescind a grant or contract if performance violated any person's rights; or endangered the health, safety, or welfare of any person; or if there were gross negligence or mismanagement in the handling or use of funds.

There are also a number of other important provisions that were enacted by ISDEA. Section 5(c) provided that Tribes make reports and information available to the Indian people served or represented by the Tribe. Section 7(a) authorized the application of Davis-Bacon wage and labor standards to ISDEA construction activity, and Section 7(b) authorized Indian preference in employment, training, and subcontracting. Section 105 provided for employment of Federal employees as well as their assignment to tribal organizations. Section 107 required consultation with Tribes on rulemaking, and presentation of any future revisions or amendments to appropriate Congressional committees, prior to publication.

ISDEA appeared to contemplate wide authority for contracting functions, authorities, and responsibilities without the limitation of procurement laws, if a Tribe requested a waiver. The Act also provided declination criteria for contracts. The Secretary was required to provide notice in writing and the opportunity to appeal his decision.

In 1986, the General Accounting Office (GAO) found that Tribes and the Indian Health Service had different perceptions of what the ISDEA meant. "Indian self-determination has not been achieved, according to the majority of Indian contractors GAO visited and the majority responding to GAO's questionnaire." (74) The GAO found that disagreements existed over subject matter, contract requirements, funding amounts, and delays. The GAO stated:

Indian contractors perceive the law as giving them the opportunity to determine for themselves the manner in which health care services should be delivered, and they see IHS restricting this freedom by various contract regulations. IHS views self-determination as Indian Tribes being able to operate IHS activities through contracts as stated in the law. (75)

Congressional intent, statutory law, published regulations, administrative practice, tribal aspirations, and orderly transition to self-determination were not well coordinated. In a special investigation conducted by the Senate Committee on Indian Affairs during 1987-1988, the Committee reported, "Indian politicians, commentators and community leaders have charged that the self determination legislation of the 1970's was an empty promise. Red tape and the perpetuation of Federal bureaucracies, inadequate authority, and condescending attitudes have restricted Native American efforts to take control of their communities." (76) The tug-o-war between tribal governments and the Indian Health Service was a by-product of Congressional ambivalence that provided for contract regulation, and waivers of contract regulation, but without sufficient guidance or clarity. There was no legislative roadmap to achieve the vision of self-determination.