19–010

Calendar No. 741

107TH CONGRESS REPORT " SENATE ! 2d Session 107–324

TO ESTABLISH A DEMONSTRATION PROJECT TO AUTHORIZE THE INTEGRATION AND COORDINATION OF FEDERAL FUNDING DEDICATED TO 

THE COMMUNITY, BUSINESS, AND ECONOMIC DEVELOPMENT OF NATIVE AMERICAN COMMUNITIES

NOVEMBER 4, 2002.—Ordered to be printed

Filed, under authority of the order of the Senate of October 17, 2002

Mr. INOUYE, from the Committee on Indian Affairs, 

submitted the following 

R E P O R T 

[To accompany S. 343]

The Committee on Indian Affairs, to which was referred the bill 

(S. 343), to establish a demonstration project to authorize the integration and coordination of Federal funding dedicated to the community, business, and economic development of Native American 

communities, having considered the same, reports favorably thereon without amendment and recommends that the bill do pass.

PURPOSE

The purpose of S. 343 is to authorize the Secretary of the Interior 

(Secretary) to establish a demonstration project to include annual 

participation of up to 24 Indian tribes, tribal organizations, or tribal consortia, to undertake Federally-funded projects to foster community, economic, and business development in Native American 

communities. 

BACKGROUND

In 1970 President Nixon issued his now-famous Special Message 

to Congress on Indian Affairs that called for significant changes in 

Federal Indian policy. Citing the failed policies of assimilation and 

termination of the 1950s, and cautioning against an excessive dependence on the Federal government, the Message laid the foundation for a more enlightened policy that relied on two core principles: economic self-sufficiency and political self-determination. 

2

1The President’s Management Agenda likewise proposes that a significant percentage of Federally-undertaken activities be ‘‘outsourced’’ to the commercial marketplace. ‘‘Historically, the 

government has realized cost savings in a range of 20 to 50 percent when federal and private 

sector service providers compete to perform these functions.’’ The President’s Management Agenda, Fiscal Year 2002, page 17. 2 Id. 

President Nixon’s Message lead to several key legislative enactments including the Native American Programs Act (42 U.S.C. 

2992d et seq.) and the Indian Financing Act in 1974 (25 U.S.C. 

1451 et seq.), and the Indian Education Assistance Act (25 U.S.C. 

455 et seq.), and the Indian Self Determination & Education Assistance Act in 1975 (Self Determination Act, 25 U.S.C. 450 et 

seq.). 

Prior to 1975, American Indian and Alaska Native communities 

depended in large part on the Federal government to provide basic 

governmental services and programs to their members. These services and programs included fire protection and law enforcement, social services, natural resources management, health and hospital 

care, and other core governmental services. 

The Self Determination Act authorizes Indian tribes and tribal 

consortia to ‘‘step into the shoes’’ of the United States and assume 

responsibility and managerial control of services and programs previously administered by the Federal government.1

Under the provisions of the Self Determination Act, participating 

tribes and tribal consortia receive funding for the services and programs they have contracted to manage. In addition to program 

funding, participants are eligible to receive contract support costs— funding to cover the costs of contract management and administration. 

The President’s Management Agenda reflects the policies and rationale of the Self Determination Act by proposing that nearly half 

of all tasks currently performed by Federal employees be undertaken by the private sector. These tasks include data collection, administrative support, payroll services and other programs.2

Under current law, tribes and tribal consortia are authorized to 

negotiate with cognizant Federal agencies to enter into contracts 

and compacts for the administration of services and programs, and 

could accordingly serve to fulfill the goals of the Management 

Agenda. 

These agencies are: (1) the Bureau of Indian Affairs (BIA), the 

principal agency responsible for administering Indian policy and 

discharging the Federal government’s trust responsibility to American Indians and Alaska Natives; and (2) the Indian Health Service 

(IHS), the principal agency responsible for carrying out the Federal 

obligation for the provision of health care services to Native people. 

Participation in the Self Determination Act is entirely voluntary 

and should a tribe or tribal consortium choose not to enter into contract or compact for the management of BIA or IHS services and 

programs, the agency in question continues to provide services and 

programs to that tribe or consortium. 

In Fiscal Year 2002, Indian tribes and tribal consortia contracted 

and compacted for nearly $752 million in BIA programs and services, out of a total BIA budget of $2.2 billion. 

Similarly, in that same year, Indian tribes and tribal consortia 

contracted and compacted for over $1.5 billion in Indian Health 

Service programs and services, out of a total IHS budget of nearly 

3

3Tribal Perspectives on Indian Self-Determination and Self-Governance in Health Care Management. Vol. 2 Narrative Report, National Indian Health Board, 1998, p. 111. 4GAO–02–193, December, 2001. 5GAO–02–193, at 14, citing the Native American Business Development, Trade Promotion 

and Tourism Act of 2000, Pub.L. 106–464 (2000).

$2.8 billion. Once having contracted a program, the tribe or consortium assumes responsibility for all aspects of its management, including program personnel, program activities, delivering program 

services, and establishing and maintaining administrative and accounting systems. 

The results of tribal participation in the Self Determination Act 

are overwhelmingly positive. A comprehensive study on the impact 

of tribal compacting for health-related programs and services conducted in 1998 indicated that 93% of tribal members surveyed indicated that the quality of tribally-delivered health services had improved after the tribe in question had undertaken to provide programs and services under the Self Determination Act.3

In addition to improving the quality of services delivered, Self 

Determination Act contracting and compacting has enhanced the 

administrative and managerial acumen of participating tribal governments. In turn, the skills developed in managing contracts and 

compacts can be translated into other areas such as Native entrepreneurship, attracting and maintaining outside investment, and 

business and community development. 

ANALYSIS OF THE INDIAN TRIBAL DEVELOPMENT CONSOLIDATED

FUNDING ACT OF 2002

Services and programs aimed at business and community development in Native communities are housed in various Federal departments and agencies including the departments of Commerce, 

Interior, Health and Human Services, Labor, Treasury, the Small 

Business Administration and others. Because these services and 

programs are often uncoordinated and provided in an untimely 

manner, their effectiveness in stimulating Native economies and 

increasing employment is not maximized. 

In December, 2001, the General Accounting Office (GAO) published its report entitled Economic Development: Federal Assistance Programs for American Indians and Alaska Natives 4 in which 

it cited the lack of coordination of existing Federal development 

programs and services as a prime cause of their ineffectiveness. 

The GAO observed that, 

[t]he federal government has made a number of efforts to 

encourage agencies to coordinate their efforts to provide 

economic development assistance to Indians. For example, 

the Native American Business Development, Trade Promotion and Tourism Act of 2000 requires [the Department 

of Commerce] to establish an Office of Native American 

Business Development.5

The Indian Tribal Development Consolidated Funding Act of 

2002 would improve the effectiveness of existing Federal development programs and services by replicating the success of the Self 

Determination Act in the realm of Federal business and community 

development programs and in the process accelerate development 

and job creation in Native communities. 

4

SECTION-BY-SECTION ANALYSIS

The Indian Tribal Development Consolidated Funding Act of 

2002 authorizes the Secretary of the Interior to establish a demonstration project in which up to 24 Indian tribes, tribal organizations, or tribal consortia may participate each fiscal year in Federally-funded projects to foster community, economic, and business 

development in Native communities. Project participants would be 

eligible to receive loans, grants, financial and other assistance provided through existing services and programs. 

Section 1. Short Title. The Act may be cited as the Indian Tribal 

Development Consolidated Funding Act of 2002. 

Section 2. Findings, Purposes. In section 2 Congress finds that 

there exists a unique legal and political relationship between the 

United States and Indian tribes; finds that a majority of Native 

Americans continue to live in poverty; and finds that Federal services and programs designed to encourage economic development 

and job creation in Native communities can be made more effective 

if those services and programs are better coordinated. The purposes 

of the bill are to empower Indian tribes and consortia to make better use of Federal funding; and to coordinate multi-agency Federal 

assistance to target the specific needs of Native communities. 

Section 3. Definitions. Section 3 provides the definition for terms 

used in this Act including ‘‘Applicant’’; ‘‘Assistance’’; ‘‘Indian tribe’’; 

‘‘Project’’; and others. 

Section 4. Lead Agency. Section 4 provides that, for purposes of 

this Act, the lead agency is the Department of the Interior. 

Section 5. Selection of Participating Tribes. Section 5 details the 

manner in which tribal applicants are selected for participation in 

the Demonstration Project. 

Section 6. Application Requirements, Review and Approval. 

Section 6 details the application process to participate in the Demonstration Project; identifies the Federal services and programs to 

be integrated; requires project participants to identify those agencies that are to be involved in the project; and provides for application review and approval procedures by the Secretary. 

Section 7. Authority of Heads of Federal Executive Agencies. 

Section 7 describes the scope of the Demonstration Project and the 

participation of Federal agencies. 

Section 8. Procedures for Processing Requests for Joint Financing. Section 8 describes the procedures to be used when a project 

is funded by more than one Federal agency. 

Section 9. Uniform Administrative Procedures. Section 9 details 

the procedures to be used when conflicting or inconsistent Federal 

regulations are confronted.

Section 10. Delegation of Supervision of Assistance. Section 10 

authorizes the head of a Federal agency to delegate to another Federal agency the ability to carry out a Demonstration Project provided that delegation is consistent with Federal law. 

Section 11. Joint Assistance Funds and Project Facilitation. Section 11 authorizes the creation of a ‘‘Joint Assistance Fund’’ for instances of multi-agency project funding. 

Section 12. Financial Management, Accountability and Audits. 

Section 12 describes the financial accountability and audit requireVerDate 0ct 31 2002 02:40 Nov 06, 2002 Jkt 019010 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\SR324.XXX SR324
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ments, including required filings pursuant to the Single Audit Act 

(31 U.S.C. 7501 et seq.) for each project funded under the Act. 

Section 13. Technical Assistance and Personnel Training. Section 

13 provides information regarding technical assistance and training 

of personnel for projects funded under the Act. 

Section 14. Joint State Financing for Federal-Tribal Assisted 

Projects. Section 14 authorizes the heads of Federal agencies to 

issue regulations governing agreements with States to extend the 

benefits of this Act. 

Section 15. Report to Congress. Section 15 requires that one year 

after the date of enactment, the President shall submit a report to 

Congress detailing the effectiveness of this Act together with any 

recommendations to improve the Act and Federal services and programs for Native development. 

LEGISLATIVE HISTORY

The Indian Tribal Development Consolidated Funding Act of 

2002 (S. 343) was introduced on February 15, 2001, by Senator 

Campbell, for himself, and for Senator Inouye. On February 26, 

2002, Senator Johnson was added as a co-sponsor. S. 343 was referred to the Committee on Indian Affairs and a hearing was held 

on the bill on May 24, 2002. On October 8, 2002, the Committee 

on Indian Affairs, by virtue of a polling instrument, considered S. 

343 and other measures that had been referred to it, and on that 

date, favorably reported S. 343. 

COMMITTEE RECOMMENDATION AND TABULATION OF VOTE

On October 8, 2002, the Committee on Indian Affairs, committee 

members considered S. 343 and favorably reported the bill to the 

full Senate. 

COST AND BUDGETARY CONSIDERATION

The cost estimate for S. 343 as calculated by the Congressional 

Budget Office, is set forth below:

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, October 18, 2002. 

Hon. DANIEL K. INOUYE, 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. 343, the Indian Tribal Development Consolidated Funding Act of 2001. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Lanette J. Walker. 

Sincerely, 

BARRY B. ANDERSON

(For Dan L. Crippen, Director). 

Enclosure. 

6

S. 343—Indian Tribal Development Consolidated Funding Act of 

2001

S. 343 would authorize the Secretary of the Interior to develop 

a demonstration project to consolidate Native American grant funding with other federal financial assistance for economic development. Under the bill, executive agencies would be directed to cooperate to jointly finance Native American economic development 

projects. Based on information from the Bureau of Indian Affairs 

(BIA), CBO estimates that any additional administrative cost to 

implement the program would not be significant. Such costs would 

be subject to the availability of appropriated funds. 

S. 343 also would authorize the Secretary of the Interior to provide planning grants to the 24 tribes or consortium of tribes that 

would participate in the demonstration project. Based on information from BIA, CBO expects that each grant would range between 

$40,000 to $50,000 and we estimate that providing such grants 

would cost about $1 million each year over the 2003–2007 period, 

assuming the appropriation of the necessary amounts. Enacting S. 

343 would not affect direct spending or revenues. 

S. 343 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. 

The CBO staff contact for this estimate is Lanette J. Walker. 

This estimate was approved by Peter H. Fontaine, Deputy Assistant Director for Budget Analysis. 

REGULATORY IMPACT STATEMENT

Paragraph 11(b) of rule XXVI of the Standing Rules of the Senate requires that each report accompanying a bill to evaluate the 

regulatory paperwork impact that would be incurred in implementing the legislation. The Committee has concluded that an enactment of S. 343 will create only a de minimis regulatory or paperwork burdens. 

EXECUTIVE COMMUNICATIONS

The Committee has received no official communication from the 

Administration on the provisions of S. 343. 

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 the bill are 

required to be set in the accompanying Committee report. The 

Committee states that enactment of S. 343 will not result in any 

changes in existing law.

(7)

A P P E N D I X 

[From the Public Papers of the Presidents of the United States Containing the Public Messages, Speeches, and 

Statements of the President 

SPECIAL MESSAGE TO THE CONGRESS ON INDIAN AFFAIRS, JULY 8, 

1970, BY PRESIDENT RICHARD NIXON

To the Congress of the United States: 

The first Americans—the Indians—are the most deprived and 

most isolated minority group in our nation. On virtually every scale 

of measurement—employment, income, education, health—the condition of the Indian people ranks at the bottom. 

This condition is the heritage of centuries of injustice. From the 

time of their first contact with European settlers, the American Indians have been oppressed and brutalized, deprived of their ancestral lands and denied the opportunity to control their own destiny. 

Even the Federal programs which are intended to meet their needs 

have frequently proven to be ineffective and demeaning. 

But the story of the Indian in America is something more than 

the record of the white man’s frequent aggression, broken agreements, intermittent remorse and prolonged failure. It is a record 

also of endurance, of survival, of adaptation and creativity in the 

face of overwhelming obstacles. It is a record of enormous contributions to this country—to its art and culture, to its strength and 

spirit, to its sense of history and its sense of purpose. 

It is long past time that the Indian policies of the Federal government began to recognize and build upon the capacities and insights of the Indian people. Both as a matter of justice and as a 

matter of enlightened social policy, we must begin to act on the 

basis of what the Indians themselves have long been telling us. The 

time has come to break decisively with the past and to create the 

conditions for a new era in which the Indian future is determined 

by Indian acts and Indian decisions. 

SELF-DETERMINATION WITHOUT TERMINATION

The first and most basic question that must be answered with respect to Indian policy concerns the historic and legal relationship 

between the Federal government and Indian communities. In the 

past, this relationship has oscillated between two equally harsh 

and unacceptable extremes. 

On the one hand, it has—at various times during previous Administrations—been the stated policy objective of both the Executive and Legislative branches of the Federal government eventually 

to terminate the trusteeship relationship between the Federal government and the Indian people. As recently as August of 1953, in 

8

House Concurrent Resolution 108, the Congress declared that termination was the long-range goal of its Indian polices. This would 

mean that Indian tribes would eventually lose any special standing 

they had under Federal law: the tax exempt status of their lands 

would be discontinued; Federal responsibility for their economic 

and social well-being would be repudiated; and the tribes themselves would be effectively dismantled. Tribal property would be divided, among individual members who would then be assimilated 

into the society at large. 

This policy of forced termination is wrong, in my judgment, for 

a number of reasons. First, the premises on which it rests are 

wrong. Termination implies that the Federal government has taken 

on a trusteeship responsibility for Indian communities as an act of 

generosity toward a disadvantaged people and that it can therefore 

discontinue this responsibility on a unilateral basis whenever it 

sees fit. But the unique status of Indian tribes does not rest on any 

premise such as this. The special relationship between Indians and 

the Federal government is the result instead of solemn obligations 

which have been entered into by the United States Government. 

Down through the years, through written treaties and through formal and informal agreements, our government has made specific 

commitments to the Indian people. For their part, the Indians have 

often surrendered claims to vast tracts of land and have accepted 

life on government reservations. In exchange, the government has 

agreed to provide community services such as health, education 

and public safety, services which would presumably allow Indian 

communities to enjoy a standard of living comparable to that of 

other Americans. 

This goal, of course, has never been achieved. But the special relationship between the Indian tribes and the Federal government 

which arises from these agreements continues to carry immense 

moral and legal force. To terminate this relationship would be no 

more appropriate than to terminate the citizenship rights of any 

other American. 

The second reason for rejecting forced termination is that the 

practical results have been clearly harmful in the few instances in 

which termination actually has been tried. The removal of Federal 

trusteeship responsibility has produced considerable disorientation 

among the affected Indians and has left them unable to relate to 

a myriad of Federal, State and local assistance efforts. Their economic and social condition has often been worse after termination 

than it was before. 

The third argument I would make against forced termination 

concerns the effect it has had upon the overwhelming majority of 

tribes which still enjoy a special relationship with the Federal government. The very threat that this relationship may someday be 

ended has created a great deal of apprehension among Indian 

groups and this apprehension, in turn, has had a blighting effect 

on tribal progress. Any step that might result in greater social, economic or political autonomy is regarded with suspicion by many Indians who fear that it will only bring them closer to the day when 

the Federal government will disavow its responsibility and cut 

them adrift. 

9

In short, the fear of one extreme policy, forced termination, has 

often worked to produce the opposite extreme: excessive dependence of the Federal government. In many cases this dependence is 

so great that the Indian community is almost entirely run by outsiders who are responsible and responsive to Federal officials in 

Washington, D.C., rather than to the communities they are supposed to be serving. This is the second of the two harsh approaches 

which have long plagued our Indian policies. Of the Department of 

the Interior’s programs directly serving Indians, for example, only 

1.5 percent are presently under Indian control. Only 2.4 percent of 

HEW’s Indian health programs are run by Indians. The result is 

a burgeoning Federal bureaucracy, programs which are far less effective than they ought to be, and an erosion of Indian initiative 

and morale. 

I believe that both of these policy extremes are wrong. Federal 

termination errs in one direction, Federal paternalism errs in the 

other. Only by clearly rejecting both of these extremes can we 

achieve a policy which truly serves the best interests of the Indian 

people. Self-determination among the Indian people can and must 

be encouraged without the threat of eventual termination. In my 

view, in fact that is the only way that self-determination can effectively be fostered. 

This, then, must be the goal of any new national policy toward 

the Indian people: to strengthen the Indian’s sense of autonomy 

without threatening his sense of community. We must assure the 

Indian that he can assume control of his own life without being 

separated involuntarily from the tribal group. And we must make 

it clear that Indians can become independent of Federal control 

without being cut off from Federal concern and Federal support. 

My specific recommendations to the Congress are designed to carry 

out this policy. 

1. Rejecting Termination 

Because termination is morally and legally unacceptable, because 

it produces bad practical results, and because the mere threat of 

termination tends to discourage greater self-sufficiency among Indian groups, I am asking the Congress to pass a new Concurrent 

Resolution which would expressly renounce, repudiate and repeal 

the termination policy as expressed in House Concurrent Resolution 108 of the 83rd Congress. This resolution would explicitly affirm the integrity and right to continued existence of all Indian 

tribes and Alaska native governments, recognizing that cultural 

pluralism is a source of national strength. It would assure these 

groups that the United States Government would continue to carry 

out its treaty and trusteeship obligations to them as long as the 

groups themselves believed that such a policy was necessary or desirable. It would guarantee that whenever Indian groups decided to 

assume control or responsibility for government service programs, 

they could do so and still receive adequate Federal financial support. In short, such a resolution would reaffirm for the Legislative 

branch—as I hereby affirm for the Executive branch—that the historic relationship between the Federal government and the Indian 

communities cannot be abridged without the consent of the Indians. 

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2. The Right to Control and Operate Federal Programs 

Even as we reject the goal of forced termination, so must we reject the suffocating pattern of paternalism. But how can we best do 

this? In the past, we have often assumed that because the government is obliged to provide certain services for Indians, it therefore 

must administer those same services. And to get rid of Federal administration, by the same token, often meant getting rid of the 

whole Federal program. But there is no necessary reason for this 

assumption. Federal support programs for non-Indian communities—hospitals and schools are two ready examples—are ordinarily administered by local authorities. There is no reason why Indian communities should be deprived of the privilege of self-determination merely because they receive monetary support from the 

Federal government. Nor should they lose Federal money because 

they reject Federal control. 

For years we have talked about encouraging Indians to exercise 

greater self-determination, but our progress has never been commensurate with our promises. Part of the reason for this situation 

has been the threat of termination. But another reason is the fact 

that when a decision is made as to whether a Federal program will 

be turned over to Indian administration, it is the Federal authorities and not the Indian people who finally make that decision. 

This situation should be reversed. In my judgment, it should be 

up to the Indian tribe to determine whether it is willing and able 

to assume administrative responsibility for a service program 

which is presently administered by a Federal agency. To this end, 

I am proposing legislation which would empower a tribe or a group 

of tribes or any other Indian community to take over the control 

or operation of Federally-funded and administered programs in the 

Department of the Interior and the Department of Health, Education and Welfare whenever the tribal council or comparable community governing group voted to do so. 

Under this legislation, it would not be necessary for the Federal 

agency administering the program to approve the transfer of responsibility. It is my hope and expectation that most such transfers 

of power would still take place consensually as a result of negotiations between the local community and the Federal government. 

But in those cases in which an impasse arises between the two parties, the final determination should rest with the Indian community. 

Under the proposed legislation, Indian control of Indian programs would always be a wholly voluntary matter. It would be possible for an Indian group to select that program or that specified 

portion of a program that it wants to run without assuming responsibility for other components. The ‘‘right of retrocession’’ would also 

be guaranteed; this means that if the local community elected to 

administer a program and then later decided to give it back to the 

Federal government, it would always be able to do so. 

Appropriate technical assistance to help local organizations successfully operate these programs would be provided by the Federal 

government. No tribe would risk economic disadvantage from managing its own programs; under the proposed legislation, locally-administered programs would be funded on equal terms with similar 

services still administered by Federal authorities. The legislation I 

11

propose would include appropriate protections against any action 

which endangered the rights, the health, the safety or the welfare 

of individuals. It would also contain accountability procedures to 

guard against gross negligence or mismanagement of Federal 

funds. 

This legislation would apply only to services which go directly 

from the Federal government to the Indian community; those services which are channeled through State or local governments could 

still be turned over to Indian control by mutual consent. To run the 

activities for which they have assumed control, the Indian groups 

could employ local people or outside experts. If they chose to hire 

Federal employees who had formerly administered these projects, 

those employees would still enjoy the privileges of Federal employee benefit programs—under special legislation which will also 

be submitted to the Congress. 

Legislation which guarantees the right of Indians to contract for 

the control or operation of Federal programs would directly channel 

more money into Indian communities, since Indians themselves 

would be administering programs and drawing salaries which now 

often go to non-Indian administrators. The potential for Indian control is significant, for we are talking about programs which annually spend over $400 million in Federal funds. A policy which encourages Indian administration of these programs will help build 

greater pride and resourcefulness within the Indian community. At 

the same time, programs which are managed and operated by Indians are likely to be more effective in meeting Indian needs. 

I speak with added confidence about these anticipated results because of the favorable experience of programs which have already 

been turned over to Indian control. Under the auspices of the Office 

of Economic Opportunity, Indian communities now run more than 

60 community action agencies which are located on Federal reservations. OEO is planning to spend some $57 million in Fiscal 

Year 1971 through Indian-controlled grantees. For over four years, 

many OEO-funded programs have operated under the control of 

local Indian organizations and the results have been most heartening. 

Two Indian tribes—the Salt River Tribe and the Zuni Tribe—

have recently extended this principle of local control to virtually all 

of the programs which the Bureau of Indian Affairs has traditionally administered for them. Many Federal officials, including the 

Agency Superintendent, have been replaced by elected tribal officers or tribal employees. The time has now come to build on these 

experiences and to extend local Indian control—at a rate and to the 

degree that the Indians themselves establish. 

3. Restoring the Sacred Lands Near Blue Lake 

No government policy toward Indians can be fully effective unless there is a relationship of trust and confidence between the 

Federal government and the Indian people. Such a relationship 

cannot be completed overnight; it is inevitably the product of a long 

series of words and actions. But we can contribute significantly to 

such a relationship by responding to just grievances which are especially important to the Indian people. 

12

One such grievance concerns the sacred Indian lands at the near 

Blue Lake in New Mexico. From the fourteenth century, the Taos 

Pueblo Indians used these areas for religious and tribal purposes. 

In 1906, however, the United States Government appropriated 

these lands for the creation of a national forest. According to a recent determination of the Indian Claims Commission, the government ‘‘took said lands from petitioner without compensation.’’ For 64 years, the Taos Pueblo has been trying to regain possession of this sacred lake and watershed area in order to preserve it 

in its natural condition and limit its non-Indian use. The Taos Indians consider such action essential to the protection and expression 

of their religious faith. 

The restoration of the Blue Lake lands to the Taos Pueblo Indians is an issue of unique and critical importance to Indians 

throughout the country. I therefore take this opportunity wholeheartedly to endorse legislation which would restore 48,000 acres 

of sacred land to the Taos Pueblo people, with the statutory promise that they would be able to use these lands for traditional purposes and that except for such uses the lands would remain forever 

wild. 

With the addition of some perfecting amendments, legislation 

now pending in the Congress would properly achieve this goal. 

That legislation (H.R. 471) should promptly be amended and enacted. Such action would stand as an important symbol of this government’s responsiveness to the just grievances of the American Indians. 

4. Indian Education 

One of the saddest aspects of Indian life in the United States is 

the low quality of Indian education. Drop-out rates for Indians are 

twice the national average and the average educational level for all 

Indians under Federal supervision is less than six school years. 

Again, at least a part of the problem stems from the fact that the 

Federal government is trying to do for Indians what many Indians 

could do better for themselves. 

The Federal government now has responsibility for some 221,000 

Indian children of school age. While over 50,000 of these children 

attend schools which are operated directly by the Bureau of Indian 

Affairs, only 750 Indian children are enrolled in schools where the 

responsibility for education has been contracted by the BIA to Indian school boards. Fortunately, this condition is beginning to 

change. The Ramah Navajo Community of New Mexico and the 

Rough Rock and Black Water Schools in Arizona are notable examples of schools which have recently been brought under local Indian 

control. Several other communities are now negotiating for similar 

arrangements. 

Consistent with our policy that the Indian community should 

have the right to take over the control and operation of federally 

funded programs, we believe every Indian community wishing to do 

so should be able to control its own Indian schools. This control 

would be exercised by school boards selected by Indians and functioning much like other school boards throughout the nation. To assure that this goal is achieved, I am asking the Vice President, acting in his role as Chairman of the National Council on Indian OpVerDate 0ct 31 2002 02:40 Nov 06, 2002 Jkt 019010 PO 00000 Frm 00012 Fmt 6601 Sfmt 6602 E:\HR\OC\SR324.XXX SR324
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1 Executive Order 11551, dated August 11, 1970, provided for additional Indian members on 

the National Council on Indian Opportunity. A White House release dated August 31, announcing the appointment of eight new members to the Council, is printed in the Weekly Compilation 

of Presidential Documents (vol. 6, p. 1132). 2Public Law No. 638, June 4, 1936 (49 Stat. 1458; 25 U.S.C. 452–455). 

portunity,1 to establish a Special Education Subcommittee of that 

Council. The members of that Subcommittee should be Indian educators who are selected by the Council’s Indian members. The Subcommittee will provide technical assistance to Indian communities 

wishing to establish school boards, will conduct a nationwide review of the educational status of all Indian school children in whatever schools they may be attending, and will evaluate and report 

annually on the status of Indian education, including the extent of 

local control. This Subcommittee will act as a transitional mechanism; its objective should not be self-perpetuation but the actual 

transfer of Indian education to Indian communities. 

We must also take specific action to benefit Indian children in 

public schools. Some 141,000 Indian children presently attend general public schools near their homes. Fifty-two thousand of these 

are absorbed by local school districts without special Federal aid. 

But 89,000 Indian children attend public schools in such high concentrations that the State or local school districts involved are eligible for special Federal assistance under the Johnson-O’Malley 

Act.2 In Fiscal Year 1971, the Johnson-O’Malley program will be 

funded at a level of some $20 million. 

This Johnson-O’Malley money is designed to help Indian students, but since funds go directly to the school districts, the Indians have little if any influence over the way in which the money 

is spent. I therefore propose that the Congress amend the JohnsonO’Malley Act so as to authorize the Secretary of the Interior to 

channel funds under this act directly to Indian tribes and communities. Such a provision would give Indians the ability to help 

shape the schools which their children attend and, in some instances, to set up new school systems of their own. At the same 

time, I am directing the Secretary of the Interior to make every effort to ensure that Johnson-O’Malley funds which are presently directed to public school districts are actually spent to improve the 

education of Indian children in these districts. 

5. Economic Development Legislation 

Economic deprivation is among the most serious of Indian problems. Unemployment among Indians is ten times the national average; the unemployment rate runs as high as 80 percent on some 

of the poorest reservations. Eighty percent of reservation Indians 

have an income which falls below the poverty line; the average annual income for such families is only $1,500. As I said in September of 1968, it is critically important that the Federal government support and encourage efforts which help Indians develop 

their own economic infrastructure. To that end, I am proposing the 

‘‘Indian Financing Act of 1970.’’

This act would do two things: 

1. It would broaden the existing Revolving Loan Fund, which 

loans money for Indian economic development projects. I am asking 

14

that the authorization for this fund be increased from approximately $25 million to $75 million. 

2. It would provide additional incentives in the form of loan guarantees, loan insurance and interest subsidies to encourage private 

lenders to loan more money for Indian economic projects. An aggregate amount of $200 million would be authorized for loan guarantee and loan insurance purposes. 

I also urge that legislation be enacted which would permit any 

tribe which chooses to do so to enter into leases of its land for up 

to 99 years. Indian people now own over 50 million acres of land 

that are held in trust by the Federal government. In order to compete in attracting investment capital for commercial, industrial and 

recreational development of these lands, it is essential that the 

tribes be able to offer long-term leases. Long-term leasing is preferable to selling such property since it enable tribes to preserve the 

trust ownership of their reservation homelands. But existing law 

limits the length of time for which many tribes can enter into such 

leases. Moreover, when long-term leasing is allowed, it has been 

granted by Congress on a case-by-case basis, a policy which again 

reflects a deep-rooted pattern of paternalism. The twenty reservations which have already been given authority for long-term leasing 

have realized important benefits from that privilege and this opportunity should now be extended to all Indian tribes. 

Economic planning is another area where our efforts can be significantly improved. The comprehensive economic development 

plans that have been created by both the Pima-Maricopa and the 

Zuni Tribes provide outstanding examples of interagency cooperation in fostering Indian economic growth. The Zuni Plan, for example, extends for at least five years and involves a total of $55 million from the Departments of Interior, Housing and Urban Development, and Health, Education and Welfare and from the Office of 

Economic Opportunity and the Economic Development Administration. I am directing the Secretary of the Interior to play an active 

role in coordinating additional projects of this kind. 

6. More Money for Indian Health 

Despite significant improvements in the past decade and a half, 

the health of Indian people still lags 20 to 25 years behind that of 

the general population. The average age at death among Indians 

is 44 years, about one-third less than the national average. Infant 

mortality is nearly 50% higher for Indians and Alaska natives than 

for the population at large; the tuberculosis rate is eight times as 

high and the suicide rate is twice that of the general population. 

Many infectious diseases such as trachoma and dysentery that 

have all but disappeared among other Americans continue to afflict 

the Indian people. 

This Administration is determined that the health status of the 

first Americans will be improved. In order to initiate expanded efforts in this area, I will request the allocation of an additional $10 

million for Indian health programs for the current fiscal year. This 

strengthened Federal effort will enable us to address ourselves 

more effectively to those health problems which are particularly 

important to the Indian community. We understand, for example, 

that areas of greatest concern to Indians include the prevention 

15

and control of alcoholism, the promotion of mental health and the 

control of middle-ear disease. We hope that the ravages of middleear disease—a particularly acute disease among Indians—can be 

brought under control within five years. 

These and other Indian health programs will be most effective if 

more Indians are involved in running them. Yet—almost 

unbelivably—we are presently able to identify in this country only 

30 physicians and fewer than 400 nurses of Indian descent. To 

meet this situation, we will expand our efforts to train Indians for 

health careers. 

7. Helping Urban Indians 

Our new census will probably show that a larger proportion of 

America’s Indians are living off the reservation than ever before in 

our history. Some authorities even estimate that more Indians are 

living in cities and towns than are remaining on the reservation. 

Of those American Indians who are now dwelling in urban areas 

approximately three-fourths are living in poverty. 

The Bureau of Indian Affairs is organized to serve the 462,000 

reservation Indians. The BIA’s responsibility does not extend to Indians who have left the reservation, but this point is not always 

clearly understood. As a result of this misconception, Indians living 

in urban areas have often lost out on the opportunity to participate 

in other programs designed for disadvantaged groups. As a first 

step toward helping the urban Indians, I am instructing appropriate officials to do all they can to ensure that this misunderstanding is corrected. 

But misunderstandings are not the most important problem confronting urban Indians. The biggest barrier faced by those Federal, 

State and local programs which are trying to serve urban Indians 

is the difficulty of locating and identifying them. Lost in the anonymity of the city, often cut off from family and friends, many 

urban Indians are slow to establish new community ties. Many 

drift from neighborhood to neighborhood; many shuttle back and 

forth between reservations and urban areas. Language and cultural 

differences compound these problems. As a result, Federal, State 

and local programs which are designed to help such persons often 

miss this most deprived and least understood segment of the urban 

poverty population. 

This Administration is already taking steps which will help remedy this situation. In a joint effort, the Office of Economic Opportunity and the Department of Health, Education and Welfare will 

expand support to a total of seven urban Indian centers in major 

cities which will act as links between existing Federal, State and 

local service programs and the urban Indians. The Departments of 

Labor, Housing and Urban Development and Commerce have 

pledged to cooperate with such experimental urban centers and the 

Bureau of Indian Affairs has expressed its willingness to contract 

with these centers for the performance of relocation services which 

assist reservation Indians in their transition to urban employment. 

These efforts represent an important beginning in recognizing 

and alleviating the severe problems faced by urban Indians. We 

hope to learn a great deal from these projects and to expand our 

16

efforts as rapidly as possible. I am directing the Office of Economic 

Opportunity to lead these efforts. 

8. Indian Trust Counsel Authority 

The United States Government acts as a legal trustee for the 

land and water rights of American Indians. These rights are often 

of critical economic importance to the Indian people; frequently 

they are also the subject of extensive legal dispute. In many of 

these legal confrontations, the Federal government is faced with an 

inherent conflict of interest. The Secretary of the Interior and the 

Attorney General must at the same time advance both the national 

interest in the use of land and water rights and the private interests of Indians in land which the government holds as trustee. 

Every trustee has a legal obligation to advance the interests of 

the beneficiaries of the trust without reservation and with the 

highest degree of diligence and skill. Under present conditions, it 

is often difficult for the Department of the Interior and the Department of Justice to fulfill this obligation. No self-respecting law firm 

would ever allow itself to represent two opposing clients in one dispute; yet the Federal government has frequently found itself in precisely that position. There is considerable evidence that the Indians 

are the losers when such situations arise. More that that, the credibility of the Federal government is damaged whenever it appears 

that such a conflict of interest exists. 

In order to correct this situation, I am calling on the Congress 

to establish an Indian Trust Counsel Authority to assure independent legal representation for the Indians’ natural resource 

rights. This Authority would be governed by a three-man board of 

directors, appointed by the President with the advice and consent 

of the Senate. At least two of the board members would be Indian. 

The chief legal officer of the Authority would be designated as the 

Indian Trust Counsel. 

The Indian Trust Counsel Authority would be independent of the 

Departments of the Interior and Justice and would be expressly 

empowered to bring suit in the name of the United States in its 

trustee capacity. The United States would waive its sovereign immunity from suit in connection with litigation involving the Authority. 

9. Assistant Secretary for Indian and Territorial Affairs 

To help guide the implementation of a new national policy concerning American Indians, I am recommending to the Congress the 

establishment of a new position in the Department of the Interior—

Assistant Secretary for Indian and Territorial Affairs. At present, 

the Commissioner of Indian Affairs reports to the Secretary of the 

Interior through the Assistant Secretary for Public Land Management—an officer who has many responsibilities in the natural resources area which compete with his concern for Indians. A new 

Assistant Secretary for Indian and Territorial Affairs would have 

only one concern—the Indian and territorial peoples, their land, 

and their progress and well-being. Secretary Hickel and I both believe this new position represents an elevation of Indian affairs to 

their proper role within the Department of the Interior and we 

urge Congress to act favorably on this proposal. 

17

CONTINUING PROGRAMS

Many of the new programs which are outlined in this message 

have grown out of this Administration’s experience with other Indian projects that have been initiated or expanded during the last 

17 months. 

The Office of Economic Opportunity has been particularly active 

in the development of new and experimental efforts. OEO’s Fiscal 

Year 1971 budget request for Indian-related activities is up 18 percent from 1969 spending. In the last year alone—to mention just 

two examples—OEO doubled its funds for Indian economic development and tripled its expenditures for alcoholism and recovery programs. In areas such as housing and home improvement, health 

care, emergency food, legal services and education, OEO programs 

have been significantly expanded. As I said in my recent speech on 

the economy, I hope that the Congress will support this valuable 

work by appropriating the full amount requested for the Economic 

Opportunity Act. 

The Bureau of Indian Affairs has already begun to implement 

our policy of contracting with local Indians for the operation of government programs. As I have noted, the Salt River Tribe and the 

Zuni Tribe have taken over the bulk of Federal services; other 

projects ranging from job training centers to high school counseling 

programs have been contracted out to Indian groups on an individual basis in many areas of the country. 

Economic development has also been stepped up. Of 195 commercial and industrial enterprises which have been established in Indian areas with BIA assistance, 71 have come into operation within 

the last two years. These enterprises provide jobs for more than 

6,000 Indians and are expected to employ substantially more when 

full capacity is reached. A number of these businesses are now 

owned by Indians and many others are managed by them. To further increase individual Indian ownership, the BIA has this month 

initiated the Indian Business Development Fund which provides 

equity capital to Indians who go into business in reservation areas. 

Since late 1967, the Economic Development Administration has 

approved approximately $80 million in projects on Indian reservations, including nearly $60 million in public works projects. The impact of such activities can be tremendous; on the Gila River Reservation in Arizona, for example, economic development projects 

over the last three years have helped to lower the unemployment 

rate from 56 to 18 percent, increase the median family income by 

150 percent and cut the welfare rate by 50 percent. 

There has been additional progress on many other fronts since 

January of 1969. New ‘‘Indian Desks’’ have been created in each of 

the human resource departments of the Federal Government to 

help coordinate and accelerate Indian programs. We have supported an increase in funding of $4 million for the Navajo Irrigation Project. Housing efforts have picked up substantially; a new 

Indian Police Academy has been set up; Indian education efforts 

have been expanded—including an increase of $848,000 in scholarships for Indian college students and the establishment of the Navajo Community College, the first college in America planned, developed and operated by and for Indians. Altogether, obligational auVerDate 0ct 31 2002 02:40 Nov 06, 2002 Jkt 019010 PO 00000 Frm 00017 Fmt 6601 Sfmt 6602 E:\HR\OC\SR324.XXX SR324
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thority for Indian programs run by the Federal Government has increased from a little over $598 million in Fiscal Year 1970 to almost $626 million in Fiscal Year 1971. 

Finally, I would mention the impact on the Indian population of 

the series of welfare reform proposals I have sent to the Congress. 

Because of the high rate of unemployment and underemployment 

among Indians, there is probably no other group in the country 

that would be helped as directly and as substantially by programs 

such as the new Family Assistance Plan and the proposed Family 

Health Insurance Plan. It is estimated, for example, that more 

than half of all Indian families would be eligible for Family Assistance benefits and the enactment of this legislation is therefore of 

critical importance to the American Indian. 

This Administration has broken a good deal of new ground with 

respect to Indian problems in the last 17 months. We have learned 

many things and as a result we have been able to formulate a new 

approach to Indian affairs. Throughout this entire process, we have 

regularly consulted the opinions of the Indian people and their 

views have played a major role in the formulation of Federal policy. 

As we move ahead in this important work, it is essential that the 

Indian people continue to lead the way by participating in policy 

development to the greatest possible degree. In order to facilitate 

such participation, I am asking the Indian members of the National Council on Indian Opportunity to sponsor field hearings 

throughout the nation in order to establish a continuing dialogue 

between the Executive branch of government and the Indian population of our country. I have asked the Vice President to see that 

the first round of field hearings are completed before October. 

The recommendations of this Administration represent an historic step forward in Indian policy. We are proposing to break 

sharply with past approaches to Indian problems. In place of a long 

series of piecemeal reforms, we suggest a new and coherent strategy. In place of policies which simply call for more spending, we 

suggest policies which call for wiser spending. In place of policies 

which oscillate between the deadly extremes of forced termination 

and constant paternalism, we suggest a policy in which the Federal 

government and the Indian community play complementary roles. 

But most importantly, we have turned from the question of 

whether the Federal government has a responsibility to Indians to 

the question of how that responsibility can best be fulfilled. We 

have concluded that the Indians will get better programs and that 

public monies will be more effectively expended if the people who 

are most affected by these programs are responsible for operating 

them. 

The Indians of America need Federal assistance—this much has 

long been clear. What has not always been clear, however, is that 

the Federal government needs Indian energies and Indian leadership if its assistance is to be effective in improving the conditions 

of Indian life. It is a new and balanced relationship between the 

United States government and the first Americans that is at the 

heart of our approach to Indian problems. And that is why we now 

19

approach these problems with new confidence that they will successfully be overcome.

RICHARD NIXON. 

THE WHITE HOUSE, July 8, 1970.

Note.—On the same day, the White House released a summary of the message 

and the transcript of a news briefing on it by Vice President Spiro T. Agnew and 

Leonard Garment, Special Consultant to the President. 

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