[Senate Report 108-17]
[From the U.S. Government Publishing Office]
108th Congress Report
SENATE
1st Session 108-17
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PROVIDING FOR THE USE AND DISTRIBUTION OF CERTAIN FUNDS AWARDED TO THE
GILA RIVER PIMA-MARICOPA INDIAN COMMUNITY, AND FOR OTHER PURPOSES
_______
March 10, 2003.--Ordered to be printed
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Mr. Campbell, from the Committee on Indian Affairs, submitted the
following
R E P O R T
[To accompany S. 162]
The Committee on Indian Affairs, to which was referred the
bill (S. 162) to provide for the use and distribution of
certain funds awarded to the Gila River Pima-Maricopa Indian
Community, 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. 162 is to authorize the Gila River Indian
Community to distribute a $7 million judgment award to eligible
Community members as required by the Indian Tribal Judgment
Funds Use or Distribution Act and to waive the repayment of
expert assistance loans made by the Department of the Interior
to the Community.
BACKGROUND AND NEED
In 1951, the Gila River Indian Community filed a complaint
before the Indian Claims Commission asserting a claim for the
failure of the United States to protect the Community's use of
water from the Gila and Salt Rivers. In 1972 and 1982, the
Indian Claims Commission and U.S. Court of Claims found the
United States liable to the Community regarding the claims made
in the final two dockets of the litigation, Dockets 236 C and
236 D, respectively.
In 1999, the Community agreed to a monetary settlement in
the amount of $7 million. Final judgment was entered against
the United States in that amount, and the Department of
Treasury certified the payment of $7 million, less attorneys
fees, to be deposited in a trust account on behalf of the
Community, which is currently being managed by the Office of
Trust Funds Management at the Department of Interior. S. 162 is
the final step in resolving litigation that began in 1951 and
this legislation represents the product of close consultation
between the Community and the Bureau of Indian Affairs
regarding the structure and content of the distribution plan.
The per capita distribution authorized in S. 162 would result
in a distribution of approximately $400 per eligible tribal
member.
The Community has experienced delays in finalizing the
enrollment data and establishing the distribution plan set
forth in the bill. Passage of S. 162 has become one of the
Community's highest priorities.
LEGISLATIVE HISTORY
S. 162 was introduced on January 15, 2003, by Senator
McCain and was referred to the Committee on Indian Affairs.
Section-by-section analysis
Sec. 1. Short Title; Table of Contents. The short title of
S. 162 is the Gila River Indian Community Judgment Fund
Distribution Act of 2003. The bill is divided into three titles
preceded by a findings and definition section.
Sec. 2. Findings. There are 8 separate findings in the
bill. These findings recite the history of the water claims
brought by the Gila River Pima-Maricopa Indian Community
against the United States on August 8, 1951 before the Indian
Claims Commission in Gila River Pima-Maricopa Indian Community
v. United States. These findings also describe the history of
the claim, the establishment of liability against the United
States on claims 236 C (1972) and 236 D (1982), the Community's
settlement of dockets number 236 C and 236 D for a total of
$7,000,000 (April 27, 1999), the entry of a final judgment of
$7,000,000 against the United States (May 3, 1999), and the
certification of $7,000,000 payment, less attorney fees, and
establishment of a trust account for the Community managed by
the Department of Interior (October 6, 1999).
The findings conclude by reciting that the Secretary is
required to submit a use and distribution plan to Congress for
approval before funds can be distributed to individual Indians.
Sec. 3. Definitions. The bill defines ``adult'',
``community'', ``Community owned funds'', ``IIM account'',
``judgment funds'', ``legally incompetent individual'',
``minor'', ``payment roll'', and ``Secretary''. The definition
of ``Community-owned funds'' has been amended and narrowed by
the Committee from the original version of the bill as
introduced to include revenues held by the Community that are
derived from trust resources and which qualify for an exemption
under section 7 or 8 of the Indian Tribal Judgment Funds Use or
Distribution Act (25 U.S.C. 1407, 1408). These ``Community-
owned funds'' are the basis for per capital payments under the
Act to adults and for transfer in trust to the Secretary for
minors, deceased beneficiaries and incompetent individuals who
are eligible for payment but who have not been listed on the
final roll.
The Department of the Interior raised concerns about the
former definition of ``Community-owned funds'' because it
included revenues derived from ``Community-owned enterprises''
which potentially could have included revenues derived by the
Community from taxable gaming activities. The Department was
concerned that under the terms of S. 162 the Secretary is
required to hold these gaming revenues in a tax exempt trust
account which later was to be paid to individual Indians on a
per capita basis. The Department was also concerned that the
mixing of exempt and non-exempt funds could change the status
of these per capita funds from exempt to non-exempt, thus
making them taxable to the recipient.
The Committee intends to make clear that these funds are
eligible to be exempt from taxation by amending and narrowing
the definition of ``community-owned funds'' to include only
those funds derived from sources already exempt from taxation.
Title I--Gila River judgment fund distribution
Section 101: Distribution of judgment funds (a) Per Capita
Payments. Section (a) authorizes the distribution of the
judgment fund amount, less attorneys fees and litigation
expenses, including all accrued interest, to all eligible
enrolled members of the Community on a per capital basis.
(b) Preparation of Payment Roll. Requires the Community to
prepare the payment roll of eligible enrolled members according
to specific criteria, and includes a description of individuals
who shall be deemed ineligible to receive per capita payments.
(c) Notice to the Secretary. Requires the Community to
notify the Secretary of Interior of the total number of
individuals eligible to share in the per capita distribution
after the Community's preparation of the payment roll, and
requires that such data be broken down into subdivisions
reflecting the number of individuals falling within the
following categories: eligible adult members, deceased
individuals, legally incompetent individuals, and minors.
(d) Information Provided to the Secretary. Requires the
Community to provide the Secretary of Interior with information
necessary to allow the Secretary to establish estate accounts
for deceased individuals and Individual Indian Money (IIM)
accounts for legally incompetent individuals and minors.
(e) Disbursement of Funds. Requires the Secretary to
disburse to the Community those funds necessary to make the per
capita payments, not later than 30 days after the payment roll
has been approved by the Community and the Community has
reconciled the number of shares that belong in each payment
category. Provides that once the funds are disbursed to the
Community, the Community shall be responsible for administering
and distributing the funds.
(f) Shares of Deceased Individuals. Requires the Secretary
of Interior to distribute per capita shares of deceased
individuals to their heirs and legatees in accordance with
existing regulations. Where there are no heirs, provides that
funds revert to the Community and shall be deposited in the
Community's general fund.
(g) Shares of Legally Incompetent Individuals. Requires the
Secretary of Interior to deposit shares of legally incompetent
individuals into supervised IIM accounts to be administered
pursuant to existing regulations.
(h) Shares of Minors. Requires the Secretary of Interior to
deposit shares of minors into supervised IIM accounts and
requires the Secretary to hold these funds in trust until the
minor attains the age of 18 years. Provides that section
3(b)(3) of the Indian Tribal Judgment Funds Distribution Act
does not apply, the effect of which is to prevent parents and
guardians of minors from being able to receive any judgment
funds on behalf of minors before they reach the age of 18
years.
(i) Payment of Eligible Individuals Not Listed on Payment
Roll. Provides that individuals not listed on the payment roll
but eligible for payment may be paid from any residual
principal or interest fund remaining after the Community has
made its per capita distribution and established its trust
accounts.
If insufficient judgment funds remain to cover the cost of
payments, the Community is authorized to use Community-owned
funds as defined by section 3(3) of the bill to make these
payments. In the case of minors, legally incompetent
individuals, and deceased individuals, the Secretary of
Interior is authorized to accept and deposit Community-owned
funds into an IIM or estate account established for a minor,
legal incompetent or deceased beneficiary eligible to receive
payment but not listed on the payment roll. Provides that the
Secretary shall invest these trust funds pursuant to existing
law.
As indicated in the discussion under Section 3
``definitions'', the Committee has amended the definition of
``Community-owned funds'' under section 3(3)(B) so that
payments under this section may only be made by the Community
with funds derived from trust resources which qualify for tax
exempt status under 25 U.S.C. 1407 and 1408.
(j) Use of Residual Funds. Allows for the transfer of
residual funds from the Department of Interior to the general
fund of the Community if the governing body of the Community
makes such a request of the Secretary and adopts a tribal
council resolution reaffirming its desire to have these
residual funds transferred. The bill as introduced was amended
to require the Community council to enact a tribal resolution
manifesting its intention to have these residual funds
transferred into the general fund of the Community.
(k) Reversion of Per Capita Shares to Tribal Ownership.
Enables the transfer of funds held in trust and the interest
accrued thereon by the Secretary to the Community if the per
capita share is unclaimed for a minimum period of 6 years. A
new section was added to clarify that a minimum of six years
must pass before the Community may request that these unclaimed
funds be transferred into the general fund of the Community.
Section (k) ``Non-applicability of Certain Law'' was deleted
because that section was rendered superfluous by the changes
adopted to the definition of ``Community-owned funds'' under
section 3(3)(b).
Sec. 102. Responsibility of Secretary; applicable law (a)
Responsibility for Funds. Provides that after disbursement of
funds by the Community to eligible adult living members as
provided under section 101(e)(1), the Secretary shall no longer
have trust responsibility for those judgment funds.
(b) Deceased and Legally Incompetent Individuals. Provides
that Secretary shall continue to have a trust responsibility
for funds retained in accounts for deceased beneficiaries and
legally incompetent individuals until the date on which those
funds are disbursed under the Act.
(c) Applicability of other Law. Provides that pursuant to
sections 7 and 8 of the Indian Tribal Judgment Funds Use or
Distribution Act, that all funds distributed under the Act,
including all interest and investment income thereon, shall be
considered tax-exempt income to individual recipients.
Title II--Conditions relating to Gila River Indian Community judgment
fund plans
Section 201. Amendment to plan for use and distribution of
judgment funds awarded in Docket 228 (a) Definition of Plan.
``Plan'' means the plan for the use and distribution of
judgment funds awarded to the Community in Docket No. 228 as
modified by Public Law 99-493 (100 Stat. 1241).
(b) Conditions. Adds conditions providing that section
3(b)(3) of the Indian Tribal Judgment Funds Use and
Distribution Act shall not apply to minors' per capita shares
held by the Secretary under the plan (effect is to prevent
shares from being distributed to parents and guardians of
minors prior to age 18), mandates the Secretary hold the
minors' per capita shares in trust until age 18 is attained by
the minor, mandates the Secretary not disburse judgment funds
or interest earned until the age 18 years is attained by the
minor, and mandates that upon the Community's request, any
residual principal and interest funds remaining after the
Community has declared the per capita payments have been
completed shall be distributed to the Community and deposited
into the Community's general fund.
Section 202. Plan for use and distribution of judgment
funds awarded in Docket 236 N (a) Definition of Plan. ``Plan''
means the plan for the use and distribution of judgment funds
awarded to the Community in Docket No. 236 N of the United
States Court of Federal Claims (59 Fed. Reg. 31092 (June 16,
1994)).
(b) Conditions. Adds conditions to require amendments to
the plan to authorize disbursement of residual principal and
interest to the Community. Adds further conditions providing
that the provisions of the Indian Tribal Judgment Funds Act
permitting payment to parents and legal guardians of minors
shall not be applicable, and requires the Secretary to hold
these minors' shares in trust until these minors attain the age
of 18 years.
Title III--Waiver of expert assistance loans
Section 301. Waives repayment by the Gila River Indian
Community of expert assistance loans made by the Department of
Interior to the Community. This section of S. 162 was amended
to remove provisions pertaining to waivers of repayment for two
other tribes in order to have the terms of S. 162 pertain only
to the Gila River Indian Community.
COMMITTEE RECOMMENDATION AND TABULATION OF VOTE
The Committee on Indian Affairs, in an open business
session on February 26, 2003, ordered S. 162 to be reported
favorably to the Senate.
COST AND BUDGETARY CONSIDERATIONS
On February 28, 2003, the cost estimate of the
Congressional Budget Office was received and a copy of that
estimate follows:
U.S. Congress,
Congressional Budget Office,
Washington, DC, February 28, 2003.
Hon. Ben Nighthorse Campbell,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 162, the Gila River
Indian Community Judgment Fund Distribution Act of 2003.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Julie
Middleton.
Sincerely,
Douglas Holtz-Eakin,
Director.
Enclosure.
S. 162--Gila River Indian Community Judgment Fund Distribution Act of
2003
S. 162 would waive the repayment of expert assistance loans
made to the Gila River Indian Community. Currently, the tribe
owes the Department of the Interior about $700,000 in principal
and interest on loans provided to pay the expenses of expert
witnesses in the tribe's claims against the federal government.
CBO estimates that enacting this provision would increase
direct spending by about $700,000 over the next couple of years
when the government would otherwise receive this repayment.
S. 162 also would establish procedures for the distribution
of about $7 million in judgment awards held in a trust fund on
behalf of the members of the Gila River Indian Community. Under
current law, the funds cannot be spent or distributed by the
tribes until the Congress approves a plan to allocate the
funds. The trust fund is held and managed in a fiduciary
capacity by the federal government on behalf of the tribe and
is treated in the budget as a nonfederal entity. As a result,
outlays were recorded on the budget when the judgments were
awarded to the tribe and paid into those funds, and there is no
budgetary impact when the money is distributed to the
individual members of the tribe. Therefore, CBO estimates that
enacting this provision would have no effect on the federal
budget.
S. 162 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
Enacting S. 162 would benefit the Gila River Indian Community
by providing for the distribution of judgment funds.
The CBO staff contact for this estimate is Julie Middleton.
This estimate was approved by Peter H. Fontaine, Deputy
Assistant Director for Budget Analysis.
EXECUTIVE COMMUNICATIONS
There are no executive communications received on this
legislation.
REGULATORY AND PAPERWORK IMPACT
Paragraph 11(b) of rule XXVI of the Standing Rules of the
Senate requires each report accompanying a bill to evaluate the
regulatory and paperwork impact that would be incurred in
implementing the bill. The Committee finds that S. 162 will not
require the promulgation of regulations so the regulatory and
paperwork impact should be minimal.
CHANGES IN EXISTING LAW
In compliance with subsection 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by a
bill are required to be set forth in the accompanying committee
report. S. 162 effects no changes in existing law.