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[House Report 109-150]
[From the U.S. Government Publishing Office]

109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    109-150

======================================================================

 
 SPOKANE TRIBE OF INDIANS OF THE SPOKANE RESERVATION GRAND COULEE DAM 
                 EQUITABLE COMPENSATION SETTLEMENT ACT

                                _______
                                

 June 23, 2005.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Mr. Pombo, from the Committee on Resources, submitted the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 1797]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Resources, to whom was referred the bill 
(H.R. 1797) 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, 
report favorably thereon without amendment and recommend that 
the bill do pass.

                          PURPOSE OF THE BILL

    The purpose of H.R. 1797 is 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.

                  BACKGROUND AND NEED FOR LEGISLATION

    Grand Coulee Dam was built in the late 1930s and early 
1940s. The accompanying reservoir inundated approximately 2,500 
acres of the Spokane Indian Reservation. Under the Indian 
Claims Commission Act of 1946, all tribes were given five years 
to file land claims against the federal government. Although 
the Spokane Tribe filed a claim at the time and settled in 
1967, lands related to the Dam were not included in the claim. 
For the Tribe to recover damages associated with the Dam 
through litigation, a federal law allowing them to file a new 
legal claim would be required. Rather than focusing on 
litigation, the Spokane Tribe has pursued direct settlement 
funding by legislative means.

                            COMMITTEE ACTION

    H.R. 1797 was introduced on April 21, 2005, by 
Representative Cathy McMorris (R-WA). The bill was referred to 
the Committee on Resources, and within the Committee to the 
Subcommittee on Water on Power. On May 18, 2005, the Full 
Resources Committee met to consider the bill. The Subcommittee 
on Water and Power was discharged from further consideration of 
the bill by unanimous consent. No amendments were offered and 
the bill was ordered favorably reported to the House of 
Representatives by unanimous consent.

                      SECTION-BY-SECTION ANALYSIS

Section 1. Short Title

    The short title of the Act is the ``Spokane Tribe of 
Indians of the Spokane Reservation Grand Coulee Dam Equitable 
Compensation Settlement Act.''

Section 2. Findings

    This section lists a number of findings that detail the 
reasons for the bill.

Section 3. Purpose

    The purpose of this act is to provide the Spokane Tribe 
with fair and equitable compensation for the use of its land 
for generation of hydropower by Grand Coulee Dam.

Section 4. Definitions

    This section defines various terms in the Act.

Section 5. Settlement Fund

    The Spokane Tribe of Indians Settlement Fund is established 
in the United States Treasury. Deposits by the Secretary of the 
Interior into the fund will be $17,800,000 in 2006 and 
$12,800,000 in each of the four years thereafter. Funds will be 
available to the Spokane Business Council (the governing body 
of the Spokane Tribe) upon request. The first $5 million 
deposited will be used for establishing and maintaining a 
Cultural Resource Repository and Interpretive Center.

Section 6. Payments by the Administrator

    Annual payments will be made to the Tribe by the 
Administrator of the Bonneville Power Administration (BPA) 
through 2033. A sunset provision caps these annual payments at 
25 years. All Native American land and water rights settlements 
signed into public law prior to this legislation have settled 
legal claims. This bill does not settle litigation and rests 
solely on settling moral claims. As such, the Committee 
strongly agrees with the need for a sunset on expenditures that 
do not settle longstanding legal claims. The first payment, to 
be made in 2007, will cover 2005 and 2006. The payment for each 
year will be equal to 29 percent of that year's payment to the 
Colville Tribes. Since this section requires BPA to make 
commensurate cost reductions to cover these annual payments, 
the Committee believes that the agency must not include these 
payments in its current rate base or any future rate adjustment 
case.

Section 7. Treatment After Funds Are Paid

    The Spokane Tribe may use funds from these payments in the 
same manner and for the same purposes as other Spokane Tribe 
governmental funds. The Secretary of the Interior and 
Administrator of BPA will have no trust responsibility over 
these funds.

Section 8. Repayment Credit

    The BPA Administrator will deduct the following amounts 
from its interest payments to the Treasury: $2,600,000 in 2007, 
and $1,300,000 in each year it makes a payment under section 6 
of the bill.

Section 9. Transfer of Administrative Jurisdiction and Restoration of 
        Ownership of Land

    Lands within the boundary of the Spokane Indian Reservation 
acquired by the United States under the 1940 Act and other 
lands shall be transferred from the Bureau of Reclamation to 
the Bureau of Indian Affairs, to be held in trust for the 
benefit and use of the Spokane Tribe and become part of the 
Spokane Indian Reservation. The United States reserves the 
right to use these transferred lands to carry out the Columbia 
Basin Project, for uses including recreational facilities. 
Transferred lands that were included in the Lake Roosevelt 
National Recreation Area shall remain part of the Recreation 
Area.

Section 10. Satisfaction of Claims

    Payments and land transfers under this Act will constitute 
full satisfaction of the moral claim of the Spokane Tribe to a 
share of Grand Coulee Dam hydropower revenues.

Section 11. Authorization of Appropriations

    Appropriations as necessary to carry out this Act are 
authorized.

Section 12. Precedent

    Nothing in this Act establishes precedent or is binding on 
the Southwestern Power Administration, Western Area Power 
Administration, or Southeastern Power Administration.

            COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Resources' oversight findings and recommendations 
are reflected in the body of this report.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Article I, section 8 of the Constitution of the United 
States grants Congress the authority to enact this bill.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act. As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, spending 
authority, credit authority, or an increase or decrease in tax 
expenditures. According to the Congressional Budget Office, 
enactment of this bill would result in reduced offsetting 
receipts.
    3. General Performance Goals and Objectives. As required by 
clause 3(c)(4) of rule XIII, the general performance goal or 
objective of this bill is 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.
    4. Congressional Budget Office Cost Estimate. Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 
Office:

H.R. 1797--Spokane Tribe of Indians of the Spokane Reservation Grand 
        Coulee Dam Equitable Compensation Settlement Act

    Summary: H.R. 1797 would establish and authorize funds to 
be appropriated to the Spokane Tribe of Indians Settlement Fund 
to compensate the Spokane Tribe of Indians for the use of its 
land by the Grand Coulee Dam project in Washington. Starting in 
2007, 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 sales, 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 for funds borrowed on BPA's behalf. CBO estimates that 
provision would reduce receipts collected by BPA by $13 million 
over the 2007-2015 period, and by $1.3 million per year after 
2015. (Those effects constitute an increase in direct 
spending.)
    Assuming appropriation of the necessary amounts, CBO 
estimates that implementing the bill would cost $69 million 
over the 2006-2010 period for payments into the Spokane Tribe 
of Indians Settlement Fund, H.R. 1797 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA). The payments authorized by 
this bill would benefit the Spokane Tribe.
    Estimated Cost to the Federal Government: The estimated 
budgetary impact of H.R. 1797 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 year, in millions of dollars--
                                 -------------------------------------------------------------------------------
                                   2006    2007    2008    2009    2010    2011    2012    2013    2014    2015
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Payments to Spokane Tribe
 Settlement:
Fund Account:
    Authorization Level.........      18      13      13      13      13       0       0       0       0       0
    Estimated Outlays...........      18      13      13      13      13       0       0       0       0       0

                                           CHANGES IN DIRECT SPENDING

Interest Credits for BPA:
    Estimated Budget Authority..       0       3       1       1       1       1       1       1       1       1
    Estimated Outlays...........       0       3       1       1       1       1       1       1       1       1
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    Basis of Estimate: For this estimate, CBO assumes that the 
bill will be enacted by the end of fiscal year 2005 and that 
the authorized amounts will be appropriated for each year.

Spending Subject to Appropriation

    This bill would authorize the appropriation of payments to 
the Spokane Tribe as compensation for land taken to build the 
Grand Coulee Dam. The bill would authorize the appropriation of 
$18 million in 2006 and $13 million annually over the 2007-2010 
period to a new tribal trust fund. Thus, CBO estimates that 
implementing the bill would cost $18 million in 2006 and $69 
million over the 2006-2010 period.
    Payments to certain 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. Because the trust funds would be 
nonbudgetary, the subsequent use of such funds by the tribe 
would not affect federal outlays.

Direct Spending

    H.R. 1797 would require BPA to make annual payments to the 
Spokane Tribe. Under the bill, such payments would be equal to 
29 percent of the annual payment BPA currently makes to the 
Colville Tribe, and would be made for 25 years. The payments 
would begin in 2007 and would total about $5 million per year, 
except in 2007 when BPA would be required to make two payments. 
Although the bill would require that the payments be offset by 
commensurate cost reductions, CBO expects that these 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 assumes that these 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 2007. 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 costs that it transfers to the U.S. Treasury for funds 
borrowed to construct BPA's infrastructure. The bill would 
authorize BPA to forgo interest payments of $2.6 million in 
2007, and $1.3 million each year thereafter for as long as 
payments are made to the tribe. As a cost-recovery agency, BPA 
would reduce its annual collections from electricity ratepayers 
by the amount of these forgone interest payments. Thus, CBO 
estimates that BPA collections, which are recorded in the 
budget as offsetting receipts, would be reduced by $2.6 million 
in 2007 and about $13 million over the 2007-2015 period.
    Intergovernmental and private-sector impact: H.R. 1797 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. The payments authorized by this bill would 
benefit the Spokane Tribe.
    Estimate prepared by: Federal Costs: Mike Waters, Lisa Cash 
Driskill, and Jimin Chung. Impact on State, Local, and Tribal 
Governments: Marjorie Miller. Impact on the Private Sector: 
Selena Caldera.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                    COMPLIANCE WITH PUBLIC LAW 104-4

    This bill contains no unfunded mandates.

                PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

    This bill is not intended to preempt any State, local or 
tribal law.

                        CHANGES IN EXISTING LAW

    If enacted, this bill would make no changes in existing 
law.

                            ADDITIONAL VIEWS

 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

    Grand Coulee Dam was authorized during the depths of the 
Great Depression as a high profile public works project, a key 
feature of the Bureau of Reclamation's Columbia Basin Project. 
When construction began in the 1930's, the purpose was to jump-
start the national economy and provide jobs for large numbers 
of unemployed laborers. While the dam has brought enormous 
water supply, flood control, and hydroelectric power benefits 
to the Pacific Northwest, the project has had devastating 
impacts on the Spokane and Colville people, their tribal 
economies, social fabric and way of life.
    Grand Coulee Dam blocked migration of anadromous fish in 
the mainstem of the Columbia River, the Spokane River and 
tributaries. These fish runs were the Spokane Tribe's primary 
source of subsistence, employment and basis for a way of life 
that had sustained tribal people since time immemorial.
    Tribal communities, including homes, schools, roads, 
telecommunication systems and other infrastructure, were 
inundated by the water impounded by Grand Coulee Dam. Some 
residents were displaced wihout relocation assistance or 
compensation and, as the water began rising behind the Dam, 
many tribal people were forced to flee their homes, leaving 
their personal belongings behind.
    Thousands of tribal burial sites located along the bluffs 
above the River were of special concern for the tribes but 
efforts to relocate human remains and associated funeral 
objects from thousands of known sites on tribal lands were 
halted due to looting and theft. These and many other 
unidentified burial sites were flooded when the Dam was 
constructed.
    Under a 1940 act, the federal government paid $63,000 and 
$4,700 to the Colville and Spokane Tribes, respectively, for 
the land used for the dam and reservoir. Subsequently, the 
Colville Tribes pursued additional claims for their lost 
fisheries and for ``water power values'' and in 1994 (P.L. 103-
436) were awarded a lump sum payment of $53 million and, 
beginning in 1996, annual payments that have ranged between $14 
million to $21 million. The Spokane Tribe did not file a claim 
within the Indian Claims Commission Act's 5-year statute of 
limitations. As a result, the Spokane Tribe did not receive a 
settlement comparable to that of the Colville Tribe, and the 
Spokane Tribe is seeking to change that situation with the 
enactment of H.R. 1797.
    H.R. 1797 will provide the Spokane Tribe of Indians with 
compensation which is proportional to (29% of) the compensation 
provided the Colville Tribes through enactment of P.L. 103-436 
in 1994. Legislation similar to H.R. 1797 was passed by the 
Senate in the 108th Congress (S. 1438). H.R. 1797, however, 
differs in one very important aspect: the inclusion of a 
``sunset'' provision on funding from the Bonneville Power 
Administration in Section 6 of the bill.
    Section 6 of H.R. 1797 directs the Administrator of the 
Bonneville Power Administration to pay to the Spokane Tribe of 
Indians an amount equal to 29 percent of the Colville's 
Computed Annual Payment (CAP) for FY 2005, adjusted for 
inflation; 29 percent of the CAP for FY 2006; and, on or before 
March 1, 2008, and each following March 1, 29 percent of the 
CAP for the previous fiscal year. However, unlike S. 1438 as 
passed by the Senate in the 108th Congress, or S. 881 
introduced by Senator Cantwell in the 109th Congress, Section 6 
of H.R. 1797 includes a sunset provision that would terminate 
this requirement for payment by BP A in 25 years.
    H.R. 1797 is premised on the past and continued use of 
Spokane tribal lands for the production of hydropower at the 
Grand Coulee Dam. At the end of 25 years, the Spokane Tribe of 
Indians' lands will continue to be used to generate hydropower, 
supply water for irrigators, provide extensive flood control 
benefits, and to assist in meeting incremental flow 
requirements for recovery of anadromous fish. The Spokane Tribe 
has agreed to the sunset provision in this bill with the 
understanding that, in the future, the Tribe may seek an 
amendment to extend or modify this sunset provision or 
otherwise seek reauthorization of BP A's annual payments post-
2030. With this understanding, and in the interest of moving 
this legislation forward and thereby providing long overdue 
relief to this Tribe, we do not object to the inclusion of the 
sunset provision in this bill and we urge passage of this bill 
by the full U.S. House of Representatives.

                                   Nick J. Rahall, II.
                                   Grace F. Napolitano.

                                  
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