[Senate Report 110-450]
[From the U.S. Government Publishing Office]
Calendar No. 948
110th Congress Report
SENATE
2d Session 110-450
======================================================================
PROVIDING FOR EQUITABLE COMPENSATION TO THE SPOKANE TRIBE OF INDIANS OF
THE SPOKANE RESERVATION FOR THE USE OF TRIBAL LAND FOR THE PRODUCTION
OF HYDROPOWER BY THE GRAND COULEE DAM, AND FOR OTHER PURPOSES
_______
September 9, 2008.--Ordered to be printed
_______
Mr. Dorgan, from the Committee on Indian Affairs, submitted the
following
R E P O R T
[To accompany S. 2494]
The Committee on Indian Affairs, to which was referred the
bill (S. 2494) to provide for equitable compensation to the
Spokane Tribe of Indians of the Spokane Reservation for the use
of tribal land for the production of hydropower by the Grand
Coulee Dam, and for other purposes, having considered the same,
reports favorably thereon without amendment and recommends that
the bill do pass.
PURPOSE
The purpose of S. 2494 is to provide equitable compensation
to the Spokane Tribe for the past and continued use of tribal
lands for the generation of hydroelectric power by the Project,
located on the main stem of the Columbia River in the State of
Washington. The Tribe received compensation in the amount of
$4,700 for the loss of its tribal lands taken for the
construction of the Project. S. 2494 would provide additional
compensation to the Tribe to better reflect the Tribe's losses,
reflect the hydroelectric power value of the lands taken, and
be comparable to the payments made to the neighboring
Confederated Tribes of the Colville Reservation (Colville
Tribes) under the terms of a congressionally approved
settlement with the United States for the loss of similar
tribal lands for the construction and operation of the Project.
BACKGROUND
I. Planning and construction of Grand Coulee Dam and hydroelectric
project
Planning for the construction of the Project began during
the period from 1927 to 1931, when the Army Corps of Engineers
(Corps), at the direction of Congress, investigated the
Columbia River and its tributaries to identify sites at which
dams could be constructed to produce hydroelectric power at low
cost. The Corps recommended that dams be constructed at a
number of sites, including the current site of the Project.
The Corps recommended that the construction of the Project
be undertaken by local governments or private utilities under
the authority of the Federal Power Act, 16 U.S.C.
Sec. Sec. 791a et seq. Section 10(e) of that Act (16 U.S.C.
Sec. 803(e)) requires that non-federal licensees utilizing
Indian lands to generate hydroelectric power pay to the Indian
tribe a reasonable annual charge for the use of its land
subject to the approval of the tribe. In 1933, an agency of the
State of Washington was issued a preliminary permit to
construct a hydroelectric project at the Grand Coulee site by
the Federal Power Commission. Several years later, however, the
Federal government assumed control of the project. Federal dams
are not subject to licensing pursuant to the Federal Power Act
or the compensation requirements of Section 10(e) of the Act.
II. Payment of compensation to tribes
Under the Act of June 29, 1940, in aid of construction of
the Project, Congress granted to the United States ``all the
right, title, and interest of the Indians in and to the tribal
and allotted lands within the Spokane and Colville Reservations
. . . as may be designated therefor by the Secretary of the
Interior from time to time. . . .'' See, 16 U.S.C. Sec. 835d-h.
This Act also provided that the Secretary of the Interior was
to determine an amount of ``just and equitable compensation for
the tribal lands taken.'' See, 16 U.S.C. Sec. 835e.
The United States recognized that the Spokane Tribe and the
Colville Tribes had compensable interests that would be injured
by the Project. These interests included the development of
hydroelectric power, a salmon fishery vital to the tribes which
would be destroyed by project construction, and the inundation
of tribal lands already identified as potential hydroelectric
power sites. See, Id.
Pursuant to the Secretary of the Interior's determination
under the Act of June 29, 1940, the Tribe was paid $4,700 in
compensation and the Colville Tribes were paid $63,000. On two
occasions, October 2, 2003 and May 15, 2008, the Committee
received testimony to the effect that the original payments
made to the tribes, $4,700 and $63,000 respectively, were not
adequate compensation to provide the tribes with ``just and
equitable compensation'' as required by the Act of June 29,
1940, and that for decades the two tribes had gone without the
type of compensation to which they would have been entitled had
the Project been licensed under the authority of the Federal
Power Act.
The Spokane Tribe and the Colville Tribes asserted various
claims before the Indian Claims Commission (ICC) under the
Indian Claims Commission Act of 1946, Pub. L. 79-726 (ICCA).
The Colville Tribes eventually asserted two claims related to
the Project under the ICCA. First, the Colville Tribes pursued
a claim for the loss of their fisheries as a result of the
Project and in 1978 settled for $3,257,000. Second, the
Colville Tribes sought compensation for the hydroelectric power
value of the lost tribal lands. Pursuant to this litigation,
the Colville Tribes secured a judicial determination that under
the ``fair and honorable dealings'' standard of the ICCA, they
could assert a claim for compensation for the hydroelectric
power value of the lost tribal lands.\1\ In 1994, Congress
ratified a settlement agreement between the Colville Tribes and
the United States providing for payment of $53,000,000 million
in damages and annual installments of $15,250,000 in
perpetuity, adjusted annually based on revenues from the sale
of hydroelectric power generated by the Grand Coulee
project.\2\
---------------------------------------------------------------------------
\1\Confederated Tribes of the Colville Reservation v. United
States, 964 F. 2d 1102 (Fed. Cir. 1992).
\2\Confederated Tribes of the Colville Reservation Grand Coulee Dam
Settlement Act, Pub. L. No. 103-436, 108 Stat. 4577 (Nov. 2, 1994)
(Colville Tribes Settlement Act).
---------------------------------------------------------------------------
Although the Spokane Tribe settled certain other issues
under the ICC, it did not file claims for loss of hydroelectric
power values before the ICCA or any other judicial forum.
Rather, the Tribe testified that it believed that the United
States was already planning, albeit belatedly, to appropriately
compensate the Tribe as required by the Act of June 29, 1940
authorizing the Project and requiring ``just and equitable
compensation for the tribal lands taken.'' The Tribe's
testimony is supported by numerous records, beginning in the
1930's and then resuming in the 1970's, of high-level agency
discussions, Solicitor's Office Opinions and memoranda,
interagency proposals and memoranda, congressional findings,
hearings, and directives--including a Task Force Study from
1976 to 1980 at the direction of the Senate Committee on
Appropriations, and negotiations with the two tribes regarding
adequate compensation for the use of tribal lands to generate
hydroelectric power by the Project.
These historical and legal records often treat the legal
basis for the Spokane Tribe's claim as the same or comparable
to the claims eventually filed by the Colville Tribes under the
ICCA. The only difference between the claims of the two tribes
is that the Spokane Tribe, relying on discussions with the
United States regarding the requirements of the Act of June 29,
1940, and the ICCA, did not file a claim under the ICCA within
its five-year statute of limitations.
Based on these circumstances, the General Accounting Office
(GAO) previously testified before the Committee that it would
be reasonable to settle with the Spokane Tribe in the same
manner as the settlement with the Colville Tribes. The GAO
testified:
A reasonable case can be made to settle the Spokane
tribe's case along the lines of the Colville
settlement--a one-time payment for the U.S. Treasury
for past lost payments for water power values and
annual payments primarily from Bonneville. Bonneville
continues to earn revenues from Spokane reservation
lands used to generate hydropower. However, unlike the
Colville tribes, the Spokane tribe does not benefit
from these revenues. The Spokane tribe does not benefit
because it missed its filing opportunity before the
Indian Claims Commission. At that time it was pursuing
other avenues to win payments for the value of its land
for hydropower. These efforts would ultimately fail.
Without congressional action, it seems unlikely that a
settlement for the Spokane tribe will occur.\3\
\3\Testimony of Robert A. Robertson, United States General
Accounting Office, October 2, 2003, before the Senate Committee on
Indian Affairs, at 3, reprinted in S. Hrg. 108-375, at 64.
Accordingly, without congressional legislation, the Spokane
Tribe may not receive just and equitable compensation for its
losses relating to the salmon fishery on which the Tribe was
economically dependent, the inundation of identified
hydroelectric power sites that the Tribe could have itself
developed, and the loss for the ongoing revenue stream the
Tribe would have received under the Federal Power Act if the
Project had not been put under Federal administration.
SUMMARY OF PROVISIONS OF S. 2494
Under the proposed legislation, the Spokane Tribe would be
compensated for the use of its lands for the production of
hydroelectric power by the Grand Coulee Dam under a formula
based in part on that by which the Colville Tribes were
compensated in the Confederated Tribes of the Colville
Reservation Grand Coulee Dam Settlement Act, Pub. L. 103-436,
108 Stat. 4577 (November 2, 1994).
The Spokane Tribe lost lands equivalent in area to 39
percent of the lands lost by the Colville Tribes.\4\ A
settlement based solely on this factor would result in payments
to the Spokane Tribe equal to 39 percent of the payments made
to the Colville Tribes. However, the Spokane Tribe agreed to
reduce this percentage to 29 percent, in recognition of the
fact that certain lands located within the boundaries of the
Spokane Reservation taken for the construction of the Project
are to be restored to the Spokane Tribe under the terms of this
legislation.
---------------------------------------------------------------------------
\4\See, Written Testimony of Richard Sherwood, Chairman, Spokane
Tribe of Indians: Hearing before the Senate Committee on Indian
Affairs, 110th Cong. 12 (May 15, 2008).
---------------------------------------------------------------------------
Under S. 2494, an interest-bearing settlement fund account
would be established in the Treasury to be known as the Spokane
Tribe of Indians Settlement Fund. Subject to the availability
of appropriations the Secretary would deposit in the Fund
$23,900,000 for fiscal year 2008, and for each of the four
fiscal years thereafter $18,900,000. These funds would be held
in trust by the Secretary, unless and until the Spokane
Business Council submits a written request to the Secretary
asking that all or part of the Fund be paid to the Spokane
Business Council. In the event such a request is made,
$5,000,000 of the initial deposit would be used for the
planning, design, construction, equipping, and operation and
maintenance of a Cultural Resource Repository and Interpretive
Center to house burial remains, funerary objects, and other
cultural resources affected by the operation of the Project and
to provide an educational facility addressing the culture and
history of the Tribe. Of the remaining assets of the Fund, 25
percent would be used by the Spokane Business Council for
discretionary purposes of general benefit to members of the
Tribe, and 75 percent for resource development, credit,
scholarship, or reserve, investment, and economic development
programs.
Additionally, on March 1, 2008, the Administrator of the
Bonneville Power Administration (Administrator) would pay the
Tribe an amount equal to 29 percent of the annual payment due
to the Colville Tribes under Sec. 5(b) of the Colville Tribes
Settlement Act for fiscal year 2007. On or before March 1 of
each year thereafter, the Administrator would make annual
payments to the Tribe equal to 29 percent of the Colville
Tribes payment for the previous fiscal year. These funds, upon
payment to the Tribe, could be used or invested by the Spokane
Business Council in the same manner and for the same purposes
as other Spokane Tribe government funds.
Expenditure of funds transferred to the Tribe by the
Administrator would not require approval by the Secretary of
the Interior or the Administrator, and these officials would
have no trust responsibility for the investment,
administration, or expenditure of those funds.
The Administrator would be authorized to deduct certain
sums ($1,300,000 in each fiscal year in which payments are made
to the Spokane Business Council) from the interest otherwise
payable to the Secretary of the Treasury from ``net proceeds''
as defined in section 13 of the Federal Columbia River
Transmission Act, 16 U.S.C. Sec. 838k, subject to certain
limitations.
The Secretary of the Interior would be directed to transfer
administrative jurisdiction for certain lands within the
exterior boundaries of the Spokane Indian Reservation to the
Bureau of Indian Affairs. Such lands would be held in trust for
the benefit of the Spokane Tribe and remain a part of the
Spokane Indian Reservation, subject to a reservation of rights
and easement on behalf of the United States regarding use of
these lands as is necessary for the operation of the Columbia
Basin Project, which includes Grand Coulee Dam, and existing
recreational facilities owned or permitted by the United
States. The lands would also be subject to the execution of a
memorandum of understanding between the relevant agencies of
the Department of the Interior and the Tribe. Finally, nothing
in section 9 or in the transfer of such lands would establish
or affect the location of the boundary between the Spokane
Indian Reservation and the Colville Reservation along the
Columbia River.
The making of the prescribed payments by the Secretary of
the Interior and the Administrator, together with the
restoration of ownership and the taking of the specified land
into trust on behalf of the Tribe, would constitute full
satisfaction of the Spokane Tribe's claims for past and
continued use of tribal lands and to a fair share of
hydroelectric revenues generated as a result of the use of
those lands.
The bill would authorize the appropriation of such funds as
are necessary to accomplish its purpose.
The bill does not establish any precedent or is binding
upon the Southwestern Power Administration, Western Area Power
Authority, or Southeastern Power Administration.
SECTION-BY-SECTION ANALYSIS
Section 1. Short title
Section 1 states that the Act may be cited as the ``Spokane
Tribe of Indians of the Spokane Reservation Grand Coulee Dam
Equitable Compensation Settlement Act.''
Section 2. Findings
Section 2 provides findings made by Congress that describe
the background and reasons for this legislation. These findings
describe the history of site selection and development of the
Project, the relationship between the Project and jurisdiction
of the Federal Power Act, recognition by the federal government
of a need to compensate the tribes, the differing experiences
of the tribes working with the United States and seeking claims
pursuant to the Indian Claims Commission Act, the harm suffered
by the Spokane Tribe in comparison to the harm suffered by the
Colville Tribes, and the Spokane Tribe's commitment to resolve
its claims through this legislation.
Section 3. Purpose
Section 3 states that the purpose of this Act is to provide
fair and equitable compensation to the Tribe for the use of its
land for the generation of hydropower by the Grand Coulee Dam.
Section 4. Definitions
Section 4 provides definitions for various terms used in
the Act.
Section 5. Settlement fund
Section 5(a) establishes an interest-bearing settlement
fund account in the Treasury of the United States to be know as
the ``Spokane Tribe of Indians Settlement Fund,'' consisting of
amounts deposited in the Fund under subsection (b) and any
interest earned on investment of amounts in the Fund.
Section 5(b) provides that, from amounts made available
under section 11, for fiscal year 2008, the Secretary shall
deposit in the Fund $23,900,000, and for each of the 4 fiscal
years thereafter, the Secretary shall deposit in the Fund
$18,900,000.
Section 5(c) provides that the Fund shall be maintained and
invested by the Secretary in accordance with the Act of June
24, 1938 (25 U.S.C. Sec. 162a).
Section 5(d) provides that at any time after funds are
deposited into the Fund, the Spokane Business Council may
submit to the Secretary written notice of the adoption by the
Spokane Business Council of a resolution requesting that the
Secretary pay all or portion of the amounts in the Fund to the
Spokane Business Council, and provides further that not later
than 60 days after receipt of such notice, the Secretary shall
pay the amount requested to the Spokane Business Council.
Section 5(e) provides that, of the initial deposit under
subsection (b)(1), $5,000,000 shall be used by the Spokane
Business Council for the planning, design, construction,
equipping, and continuing operation and maintenance of a
Cultural Resource Repository and Interpretive Center to house,
preserve, and protect the burial remains and funerary and
cultural resources affected by the operation of the Grand
Coulee Dam, and provide an interpretive and educational
facility regarding the culture and history of the Spokane
Tribe. The section also provides that the funding of these
activities does not alter or affect any authority, obligation,
or responsibility of the United States under the Native
American Graves Protection and Repatriation Act (25 U.S.C.
Sec. Sec. 3001 et seq.), the Archaeological Resources
Protection Act (16 U.S.C. Sec. Sec. 470aa et seq.), the
National Historic Preservation Act (16 U.S.C. Sec. Sec. 470 et
seq.), or the National Environmental Policy Act of 1969 (42
U.S.C. 4321 et seq.). Of all other amounts deposited in the
Fund (including interest generated on those amounts), 25
percent shall be reserved by the Spokane Business Council and
used for discretionary purposes of general benefit to all
members of the Spokane Tribe, and 75 percent shall be used by
the Spokane Business Council to carry out resource development
programs, credit programs, scholarship programs, or reserve,
investment, and economic development programs.
Section 6. Payments by the Administrator
Section 6(a) provides that on March 1, 2008, the
Administrator shall pay to the Tribe an amount equal to 29
percent of the Computed Annual Payment for fiscal year 2007.\5\
---------------------------------------------------------------------------
\5\``Computed Annual Payment'' is defined in section 4 of the bill
as the payment calculated under paragraph 2.b. of the Colville
Settlement Agreement, without regard for any increase or decrease in
the payment under section 2.d. of the agreement.
---------------------------------------------------------------------------
Section 6(b) provides that not later than March 1, 2009,
and March 1 of each year thereafter, the Administrator shall
pay the Tribe an amount equal to 29 percent of the Computed
Annual Payment for the preceding fiscal year.
Section 6(c) provides that in accordance with the payment
schedule described in subsection (b), the Administrator shall
make commensurate cost reductions in expenditures, on an annual
basis, to recover each payment to the Tribe under this section.
This section also provides that this cost reduction plan shall
be included in the annual budget submitted by the Administrator
to Congress.
Section 7. Treatment after funds are paid
Section 7(a) provides that payments made to the Spokane
Business Council or Spokane Tribe under section 5 or 6 may be
used or invested by the Business Council in the same manner and
for the same purposes as the Tribe's other governmental funds.
Section 7(b) provides that neither the Secretary nor the
Administrator shall have any trust responsibility for the
investment, supervision, administration, or expenditure of any
funds after the date on which the funds are paid to the Spokane
Business Council or Spokane Tribe under section 5 or 6.
Section 7(c) provides that the payments of all funds to the
Spokane Business Council and Spokane Tribe under sections 5 and
6, and the interest and income generated by the funds, shall be
treated in the same manner as payments under section 6 of the
Saginaw Chippewa Indian Tribe of Michigan Distribution of
Judgment Funds Act (100 Stat. 677).\6\
---------------------------------------------------------------------------
\6\Section 6 of the Saginaw Chippewa Act provides that
distributions of certain funds paid to that tribe under the Act to its
enrolled members are not subject to Federal, State, or local income
taxes and that such distributions may not be used as a basis for
denying or reducing (1) financial assistance or other benefits under
the Social Security Act to such tribal member or the member's
household, or (2) any other Federal financial assistance or benefit to
which the tribal member or member's household may be otherwise
entitled.
---------------------------------------------------------------------------
Section 7(d) provides that after the date on which funds
are paid to the Spokane Business Council or Spokane Tribe under
section 5 or 6, the funds shall constitute Spokane Tribe
governmental funds and shall be subject to an annual tribal
government audit.
Section 8. Repayment credit
Section 8(a) provides that the Administrator shall deduct
from the interest payable to the Secretary of the Treasury from
net proceeds (as defined in section 13 of the Federal Columbia
River Transmission System Act (16 U.S.C. Sec. 838k)) in fiscal
year 2008, $1,300,000; and in each subsequent fiscal year in
which the Administrator makes a payment under section 6,
$1,300,000.
Section 8(b)(1) provides that except as provided in
paragraphs (2) and (3), each deduction made under this section
shall be a credit to the interest payments otherwise payable by
the Administrator to the Secretary of the Treasury during the
fiscal year in which the deduction is made, and shall be
allocated pro rata to all interest payments on debt associated
with the generation function of the Federal Columbia River
Power System that are due during the fiscal year. Section
8(b)(2) provides that if, in any fiscal year, the deduction is
greater than the amount of interest due on debt associated with
the generation function for the fiscal year, the amount of the
deduction that exceeds the interest due on debt associated with
the generation function shall be allocated pro rata to all
other interest payments due during the fiscal year. Section
8(b)(3) provides that to the extent that a deduction exceeds
the total amount of interest described in paragraphs (1) and
(2), the deduction shall be applied as a credit against any
other payments that the Administrator makes to the Secretary of
the Treasury.
Section 9. Transfer of administrative jurisdiction and restoration of
ownership of land
Section 9(a) provides that the Secretary shall transfer
administrative jurisdiction from the Bureau of Reclamation to
the Bureau of Indian Affairs over all land acquired by the
United States under the Act of June 29, 1940 (16 U.S.C.
Sec. 835d), that is located within the exterior boundaries of
the Spokane Indian Reservation established pursuant to the
Executive Order of January 18, 1881.
Section 9(b)(1) provides that all land transferred under
this section shall be held in trust for the benefit and use of
the Tribe and shall remain part of the Spokane Indian
Reservation.
Section 9(b)(2) provides that the Federal trust
responsibility for all land transferred under this section
shall be the same as the responsibility for other tribal land
held in trust within the Spokane Indian Reservation.
Section 9(c) provides that nothing in this section
establishes or affects the precise location of the boundary
between the Spokane Indian Reservation and the Colville
Reservation along the Columbia River and Lake Roosevelt. Any
unresolved issues relating to the Tribes' common Reservation
boundary would not be affected in any way by the proposed
legislation; however, the Committee does recommend that all
such issues be resolved through further negotiations between
the two tribal sovereigns.
Section 9(d)(1) provides that the United States reserves a
perpetual right, power, privilege, and easement over the land
transferred under this section to carry out the Columbia Basin
Project under the Columbia Basin Project Act (16 U.S.C.
Sec. Sec. 835 et seq.). Section 9(d)(2) provides further that
the rights reserved under paragraph (1) further include the
right to operate, maintain, repair, and replace boat ramps,
docks, and other recreational facilities owned or permitted by
the United States and existing on the date of enactment of this
Act. Section 9(d)(3) provides that land transferred under this
section that, before the date of enactment of this Act, was
included in the Lake Roosevelt National Recreation Area shall
remain part of the Recreation Area, and further provides that
nothing in this section shall affect the authority or
responsibility of the National Park Service to administer the
Lake Roosevelt National Recreation Area under the Act of August
25, 1916 (39 Stat. 535, chapter 408; 16 U.S.C. Sec. Sec. 1 et
seq.). Section 9(d)(4) provides that the cognizant agencies of
the Department of the Interior shall enter into a memorandum of
understanding with the Tribe to provide for coordination in
applying this subsection.
Section 10. Satisfaction of claims
Section 10 provides that payment by the Secretary under
section 5 and by the Administrator under section 6 and
restoration of ownership of land in trust under section 9
constitute full satisfaction of the claim of the Tribe to a
fair share of the annual hydropower revenues generated by the
Grand Coulee Dam project for the past and continued use of land
of the Tribe for the production of hydropower at the Dam.
Section 11. Authorization of appropriations
Section 11 authorizes the appropriation of such sums as are
necessary to carry out this Act.
Section 12. Precedent
Section 12 provides that nothing in this Act establishes
any precedent or is binding on the Southwestern Power
Administration, Western Area Power Administration, or
Southeastern Power Administration.
LEGISLATIVE HISTORY
Settlement bills relating to the Tribe's claims were
introduced in the past five Congresses. At different times,
some of these bills passed the Senate and the House, but not in
the same Congress. Bills were introduced in the 106th Congress
(S. 1525 and H.R. 2664), in the 107th Congress (S. 2567 and
H.R. 4859), in the 108th Congress (S. 1438 and H.R. 1753), and
in the 109th Congress (S. 881 and H.R. 1797). In the 110th
Congress, Senator Cantwell introduced S. 2494 for herself and
Senators Inouye and Murray on December 17, 2007.
Two rounds of hearings have also been held on these bills.
On October 2, 2003, the Senate Committee on Indian Affairs held
a hearing on S. 1438, and on the same date, the Water and Power
Subcommittee of the House Committee on Natural Resources held a
hearing on H.R. 1753. On May 15, 2008, the Senate Committee on
Indian Affairs held a hearing on S. 2494.
COMMITTEE RECOMMENDATION AND TABULATION OF VOTE
On June 19, 2008, the Committee on Indian Affairs convened
a business meeting to consider S. 2494 and other measures. The
Committee voted to have the bill favorably reported without
amendment.
COST AND BUDGETARY CONSIDERATIONS
The cost estimate for S. 2494, as calculated by the
Congressional Budget Office, is set forth below:
S. 2494--Spokane Tribe of Indians of the Spokane Reservation Grand
Coulee Dam Equitable Compensation Settlement Act
Summary: S. 2494 would provide compensation to the Spokane
Tribe of Indians for the use of tribal lands to generate
hydroelectric power by the Grand Coulee Dam. The bill would
require the Bonneville Power Administration (BPA) to make
annual payments to the tribe from receipts generated from the
sale of electricity. Those payments to the tribe would be
offset by increases in the rates charged to BPA's customers for
electricity, and thus would result in no net cost to the
government. Under the bill, BPA also would be relieved from
making certain interest payments to the Treasury. CBO estimates
that provision would reduce interest payments received by the
Treasury by $13 million over the 2009-2018 period and by $1.3
million per year after 2018. (Those effects constitute an
increase in direct spending.) Finally, the bill would create
the Spokane Tribe of Indians Settlement Fund as compensation
for land taken to build the Grand Coulee Dam. CBO estimates
that implementing this provision would cost $76 million over
the 2009-2012 period, assuming appropriation of the authorized
amounts.
S. 2494 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 2494 is shown in the following table.
The costs of this legislation fall within budget functions 450
(community and regional development) and 270 (energy).
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal, in millions of dollars--
-------------------------------------------------------------------------------------------
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2009-2013 2009-2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Payments to Spokane Tribe Settlement Fund Account:
Authorization Level.................................... 19 19 19 19 0 0 0 0 0 0 76 76
Estimated Outlays...................................... 19 19 19 19 0 0 0 0 0 0 76 76
CHANGES IN DIRECT SPENDING
Interest Credits for BPA:
Estimated Budget Authority.............................. 1 1 1 1 1 1 1 1 1 1 7 13
Estimated Outlays....................................... 1 1 1 1 1 1 1 1 1 1 7 13
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Amounts may not sum to totals because of rounding.
Basis of estimate: For this estimate, CBO assumes that the
bill will be enacted by the beginning of 2009 and that the
authorized amounts will be appropriated beginning that year.
Spending subject to appropriation
S. 2494 would create the Spokane Tribe of Indians
Settlement Fund as compensation for land taken to build the
Grand Coulee Dam. The bill would authorize the appropriation of
$18.9 million annually over the 2009-2012 period to that new
tribal trust fund. The Secretary of the Interior would be
required to invest those amounts in government securities until
those funds are expended. CBO estimates that implementing the
bill would cost $76 million over the 2009-2012 period.
Payments to certain tribal trust funds that are held and
managed in a fiduciary capacity by the federal government on
behalf of Indian tribes are treated as payments to a nonfederal
entity. As a result, CBO expects that the entire amount
deposited to the fund in any year would be recorded as budget
authority and outlays in that year. Subsequently, the trust
fund would be nonbudgetary, and any use of such funds and
interest payments to the tribes would have no effect on the
federal budget.
Direct spending
S. 2494 would require BPA to make annual payments to the
Spokane Tribe. Under the bill, such payments would equal 29
percent of the annual payment BPA currently makes to the
Colville Tribe. For this estimate, CBO assumes that payments to
the Spokane Tribe would begin in 2009 and would average about
$6 million per year. Payments would continue so long as
electricity continues to be generated at the Grand Coulee Dam.
Although the bill would require that the payments be offset by
commensurate cost reductions, CBO expects that those payments
would contribute to an increase in costs to the agency. Because
BPA is a cost-recovery agency that charges its customers for
the electricity it generates, CBO expects that those payments
to the tribe would become part of BPA's cost structure and
would be offset by an increase in the new electricity rates
that the agency plans to impose in 2009. Thus, this annual
payment to the tribe would result in no net cost to the
government.
The bill also would allow BPA to reduce the amount of
interest that it pays to the U.S. Treasury for funds borrowed
to construct BPA's infrastructure. The bill would authorize BPA
to forgo interest payments of $1.3 million a year for as long
as payments are made to the tribe. Thus, CBO estimates that
enacting this provision would increase the Treasury's outlays
for net interest by $13 million over the 2009-2018 period.
Intergovernmental and private-sector impact: S. 2494
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments. The payments authorized by this bill would
benefit the Spokane Tribe.
Estimate prepared by: Federal costs: Leigh Angres and
Kathleen Gramp; Impact on state, local, and tribal governments:
Melissa Merrell; Impact on the private sector: MarDestinee
Perez.
Estimate approved by: Theresa Gullo Deputy Assistant
Director for Budget Analysis.
REGULATORY AND PAPERWORK IMPACT STATEMENT
Paragraph 11(b) of rule XXVI of the Standing Rules of the
Senate requires that each report accompanying a bill evaluate
the regulatory and paperwork impact that would be incurred in
carrying out the bill. The Committee has concluded that the
regulatory and paperwork impacts of S. 2494 should be de
minimus.
EXECUTIVE COMMUNICATION
At a May 15, 2008, hearing, the Department of the Interior
testified in opposition to S. 2494. The Department questioned
whether awarding such a settlement was warranted because the
Tribe had not brought a legal claim against the United States.
The Department also provided written testimony that stated:
``The Department is also concerned with transferring
land and jurisdiction from the Bureau of Reclamation to
the Bureau of Indian Affairs for the Tribe absent a
prior written agreement to fully address Reclamation's
and National Park Service's future ability to manage
Grand Coulee Dam, Lake Roosevelt, and the Columbia
Basin Project. Such a written agreement should clearly
address a number of issues associated with transferring
land into trust status, such as future liability for
damages from shoreline erosion and heavy metal
contamination in sediments from upstream mining, as
well as issues related to land and recreation
management, including consideration of the existing
five-party Lake Roosevelt Cooperative Management
Agreement. While under the present draft Reclamation
would be granted a perpetual easement to operate the
Columbia Basin Project, it is imperative that the
parties specifically reach agreement on the details of
the lands and easement rights involved and how the
transferred areas will be managed prior to the passage
of this legislation. At a minimum, such an agreement
should be required prior to the actual transfer taking
place.''
In addition, the views of the Administration on S. 2489 as
introduced were provided in a letter from George Skibine,
Deputy Assistant Secretary for Policy and Economic
Development--Indian Affairs, United States Department of the
Interior, dated June 18, 2008, and are set forth below:
Department of the Interior,
Office of the Secretary,
Washington, DC, June 18, 2008.
Hon. Byron L. Dorgan,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The following sets forth the views of
the Department of the Interior on S. 2494, the ``Spokane Tribe
of Indians of the Spokane Reservation Grand Coulee Dam
Equitable Compensation Settlement Act''. The Department opposes
the bill. The Administration has worked with the Spokane Tribe
over the last several years on this issue. We believe
negotiations to correct several serious issues should continue.
S. 2494 would provide compensation to the Spokane Tribe for
the use of its land for the generation of hydropower by the
Grand Coulee Dam. Specifically, S. 2494 would require the
Secretary of the Interior, subject to the availability of
appropriations, to deposit $99.5 million over five years,
$23,900,000 for fiscal year 2008 and $18,900,000 for the
following four fiscal years, into a trust fund held in the U.S.
Treasury and maintained and invested by the Secretary of the
Interior for the Spokane Tribe to be known as the ``Spokane
Tribe of Indians Settlement Fund''. S. 2494 would also transfer
certain land and administrative jurisdiction from the Bureau of
Reclamation (BOR) to Bureau of Indian Affairs (BIA) for the
Spokane Tribe. The land transferred would be held in trust for
the Spokane Tribe and would become part of the reservation.
The Spokane Tribe has not brought forward a legal claim
that would warrant this type of settlement. The Administration
questions whether the Tribe has or could bring any legal claim
that would entitle it to compensation as contemplated under the
bill. In light of the lack of any pending legal claim, the
Administration does not believe this legislation is currently
justified as a settlement of claims.
The Department is also concerned with transferring land and
jurisdiction from the Bureau of Reclamation to the Bureau of
Indian Affairs for the Tribe absent a prior written agreement
to fully address Reclamation's and National Park Service's
future ability to manage Grand Coulee Dam, Lake Roosevelt, and
the Columbia Basin Project. Such a written agreement should
clearly address a number of issues associated with transferring
land into trust status, such as future liability for damages
from shoreline erosion and heavy metal contamination in
sediments from upstream mining, as well as issues related to
land and recreation management, including consideration of the
existing five-party Lake Roosevelt Cooperative Management
Agreement. While under the present draft Reclamation would be
granted a perpetual easement to operate the Columbia Basin
Project, it is imperative that the parties specifically reach
agreement on the details of the lands and easement rights
involved and how the transferred areas will be managed prior to
the passage of this legislation. At a minimum, such an
agreement should be required prior to the actual transfer
taking place.
The Office of Management and Budget has advised that there
is no objection to the presentation of this report from the
standpoint of the Administration's program.
Sincerely,
George T. Skibine,
Deputy Assistant Secretary for Policy and Economic Development--
Indian Affairs.
CHANGES IN EXISTING LAW
In compliance with subsection 12 of rule XXVI of the
Standing Rules of the Senate, the Committee states that the
enactment of S. 2494 makes no changes to existing law.