S. HRG. 107–360

FISCAL YEAR 2003 BUDGET

HEARING

BEFORE THE

COMMITTEE ON INDIAN AFFAIRS

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

ON

PRESIDENT’S BUDGET REQUEST FOR INDIAN PROGRAMS FOR FISCAL

YEAR 2003

MARCH 5, 7, 14, 2002

WASHINGTON, DC

(
FISCAL YEAR 2003 BUDGET
U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

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78–431 PDF 2002

S. HRG. 107–360

FISCAL YEAR 2003 BUDGET

HEARING

BEFORE THE

COMMITTEE ON INDIAN AFFAIRS

UNITED STATES SENATE

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

ON

PRESIDENT’S BUDGET REQUEST FOR INDIAN PROGRAMS FOR FISCAL

YEAR 2003

MARCH 5, 2002

WASHINGTON, DC

(
COMMITTEE ON INDIAN AFFAIRS

DANIEL K. INOUYE, Hawaii, Chairman

BEN NIGHTHORSE CAMPBELL, Colorado, Vice Chairman

FRANK MURKOWSKI, Alaska

JOHN McCAIN, Arizona,

PETE V. DOMENICI, New Mexico

CRAIG THOMAS, Wyoming

ORRIN G. HATCH, Utah

JAMES M. INHOFE, Oklahoma

KENT CONRAD, North Dakota

HARRY REID, Nevada

DANIEL K. AKAKA, Hawaii

PAUL WELLSTONE, Minnesota

BYRON L. DORGAN, North Dakota

TIM JOHNSON, South Dakota

MARIA CANTWELL, Washington

PATRICIA M. ZELL, Majority Staff Director/Chief Counsel

PAUL MOOREHEAD, Minority Staff Director/Chief Counsel

(II)
(III)

C O N T E N T S

Page

MARCH 5, 2002

Statements:

Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, vice chairman, Committee on Indian Affairs .............................................................. 2

Carter, Clarence, director, Office of Community Services, Department

of Health and Human Services .................................................................... 10

Corwin, Tom, deputy assistant secretary, Office of Elementary and Secondary Education, Department of Education ............................................. 17

DeLuca, James C., chief, Division of Indian and native American Programs, Department of Labor ........................................................................ 3

Dye, David, deputy assistant secretary, Employment and Training, Department of Labor ......................................................................................... 3

Henke, Tracy A., Principal Deputy Assistant Attorney General, Office

of Justice Programs, Department of Justice ............................................... 25

Inouye, Hon. Daniel K., U.S. Senator from Hawaii, chairman, Committee

on Indian Affairs ........................................................................................... 1

Martin, Cathie, acting director, Office of Indian Education, Department

of Education ................................................................................................... 17

APPENDIX

Prepared statements:

Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, vice chairman, Committee on Indian Affairs .............................................................. 31

Carter, Clarence ............................................................................................... 45

Corwin, Tom ...................................................................................................... 59

Dorgan, Hon. Byron L., U.S. Senator from North Dakota ............................ 32

Dye, David (with attachments) ........................................................................ 34

Henke, Tracy A. (with attachments) ............................................................... 69

Johnson, Hon. Tim, U.S. Senator from South Dakota .................................. 32

MARCH 7, 2002

Statements:

Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, vice chairman, Committee on Indian Affairs .............................................................. 235

Hartz, Gary, acting director, Office of Public Health, Department of

Health and Human Services ........................................................................ 236

Inouye, Hon. Daniel K., U.S. Senator from Hawaii, chairman, Committee

on Indian Affairs ........................................................................................... 234

Lincoln, Michel, deputy director, Indian Health Service, Department of

Health and Human Services ........................................................................ 236

Liu, Michael, assistant secretary, Office of Public and Indian Housing,

Department of Housing and Urban Development ...................................... 255

Trujillo, Michael, M.D, director, Indian Health Service, Department of

Health and Human Services ........................................................................ 236

APPENDIX

Prepared statements:

Bird, Michael, executive director, National Native American Aids Prevention Center (with Attachments) ................................................................... 276

Domenici, Hon. Pete V., U.S. Senator from New Mexico .............................. 263
Page

IV

Prepared statements—Continued

Liu, Michael (with attachments) ..................................................................... 264

National Congress of American Indians (with attachments) ........................ 272

Sarris, Greg, chairperson, Federated Indians of Graton Rancheria ............ 269

Trujillo, Michael, M.D ...................................................................................... 269

Additional material submitted for the record:

Sioux Funeral Home Thrives On Chronic Ills of Local Reservation, article

by Jonathan Eig, staff reporter, Wall Street Journal ................................ 300

Tables ................................................................................................................ 324

Trends in Racial and Ethnic-Specific Rates for the Health Status Indicators: United States, 1990–98, study by the Centers for Disease Control

and Prevention, Department of Health and Human Services .................. 308

MARCH 14, 2002

Statements:

Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, vice chairman, Committee on Indian Affairs .............................................................. 361

Conrad, Hon. Kent, U.S. Senator from North Dakota .................................. 364

Deer, Montie, chairman, National Indian Gaming Commission .................. 380

Domenici, Hon. Pete V., U.S. Senator from New Mexico .............................. 365

Dorgan, Hon. Byron L., U.S. Senator from North Dakota ............................ 364

Inouye, Hon. Daniel K., U.S. Senator from Hawaii, chairman, Committee

on indian Affairs ........................................................................................... 360

McCaleb, Neal, assistant secretary, BIA, Department of the Interior ......... 362

Regas, Diane C., acting assistant administrator, Office of Water, Environmental Protection Agency ............................................................................ 376

APPENDIX

Prepared statements:

Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, vice chairman, Committee on Indian Affairs .............................................................. 387

Deer, Montie (with attachments) .................................................................... 394

Kindle, William H., president, Rosebud Sioux Tribe ..................................... 388

McCaleb, Neal ................................................................................................... 440

Murkowski, Hon. Frank H., U.S. Senator from Alaska ................................ 388

Regas, Diane C. (with attachment) ................................................................. 449

Additional material submitted for the record:

Responses to questions submitted by Hon. Daniel K. Inouye, chairman,

Committee on Indian Affairs ....................................................................... 391

Note: Other material submitted for the record will be retained in

committee files.
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FISCAL YEAR 2003 BUDGET

TUESDAY, MARCH 5, 2002

U.S. SENATE,

COMMITTEE ON INDIAN AFFAIRS,

Washington, DC.

The committee met, pursuant to call, at 10:03 a.m. in room 485,

Senate Russell Building, Hon. Daniel K. Inouye (Chairman of the

committee) presiding.

Present: Senators Inouye, Conrad, and Campbell.

STATEMENT OF HON. DANIEL K. INOUYE, U.S. SENATOR FROM

HAWAII, CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

The CHAIRMAN. The committee meets this morning for the first

in a series of three hearings on the President’s budget request for

Indian programs for fiscal year 2003. This first hearing will focus

on Indian programs administered by the Departments of Justice,

Labor, and Education.

In addition, those Indian programs administered by the Department of Health and Human Services that are outside the Indian

Health Service will be addressed today. On Thursday of this week

the committee will receive testimony from the Department of Housing and Urban Development and Indian Health Service.

On Thursday of next week, March 14, the committee will receive

testimony on the President’s budget request for the Bureau of Indian Affairs, the National Indian Gaming Commission, and the Environmental Protection Agency. In those coming hearings, the committee will be exploring how the United States trust responsibility

for Indian lands and resources would be maintained if the President’s proposals to privatize the administration of Federal programs are approved by the Congress.

Today, however, we look forward to hearing from the Federal

agencies as to the objectives that the President’s budget request for

Indian programs under the respective jurisdiction seeks to accomplish in fiscal year 2003.

With that, I would like to call upon the first witness, the Deputy

Assistant Secretary of Employment and Training Administration,

David Dye. Before I recognize Mr. Dye, may I call upon the vice

chairman?
2

STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM COLORADO, VICE CHAIRMAN, COMMITTEE ON

INDIAN AFFAIRS

Senator CAMPBELL. Thank you, Mr. Chairman. We will hear from

a number of agencies today, as you mentioned. There are a number

of important issues that we have to face up to on Indian reservations: Law enforcement, policing, education, drug treatment, elder

care, and the Administration for Native Americans. They are all

extremely important.

Safe and stable communities provide safety for their members

and also attract business activity, which is so important to native

people nationwide. I might mention, I don’t know if you saw the

Wall Street Journal this morning, Mr. Chairman, but there was an

article on the front page that indicated that one of the most successful forms of business on reservations now are funeral homes.

To me that is a terrible, sad commentary about what is happening

on Indian reservations. But if you are out there as much as I am,

you know that the death rate is just incredible.

Given the demands placed on the Department of Justice to fight

terrorism, I have to tell you, I am generally encouraged by the request for Indian law enforcement with a few exceptions. One is the

lack of tribal detention center funds. Another is the reduction in

the COPS funding for tribes and the third is static funding for tribal courts.

I think in the hearings we have done in the past we have

stressed that strengthening tribal courts is really one of the pillars,

one of the foundations, of making sure that homelands for Indian

tribes are safe. I am hopeful that we can find the kind of resources

that we need for those important services.

I commend the President for his dramatic increase in funds for

substance abuse and mental health treatment. We know that these

problems continue to ravage Indian communities and I am certainly glad to see the increase. The problem is that even though we

have an increase in the funds, the demand grows faster than the

increase.

We have some reservations, in fact, where 50 percent of the

whole tribe is under 25 years old. So, clearly, we have not been

keeping up with the demands.

I have several questions I would like to ask this morning, but in

the interest of time, let me just close by saying one agency I am

particularly interested in and that is the ANA. The ANA, the Administration for Native Americans, provides seed capital for Indian

businesses, language preservation and environmental protection

and does it in a way that reduces dependence.

I certainly urge the department to study the ANA and find out

why it works so well when some other programs are not working

so well.

With that, Mr. Chairman, I would ask unanimous consent to introduce my complete statement in the record.

The CHAIRMAN. Without objection, it is so ordered.

[Prepared statement of Senator Campbell appears in appendix.]

The CHAIRMAN. With that, may I recognize Mr. Dye.
3

STATEMENT OF DAVID DYE, DEPUTY ASSISTANT SECRETARY

FOR EMPLOYMENT AND TRAINING, DEPARTMENT OF

LABOR, ACCOMPANIED BY JAMES C. DELUCA, CHIEF, DIVISION OF INDIAN AND NATIVE AMERICAN PROGRAMS

Mr. DYE. Thank you, Mr. Chairman. Mr. Chairman and members

of the committee, thank you for the opportunity to discuss the Department of Labor’s Employment and Training Programs for Indian

and Native Americans in Program Years 2002 and 2003.

I am please to have with me today James C. DeLuca, who heads

the Division of Indian and Native American Programs of the Department of Labor. ETA’s primary strategy for Indian and Native

American programs focuses on the continuation of our partnership

initiatives and support for the President’s commitment to work

with tribal governments on a sovereign to sovereign basis to provide Native Americans with new economic and educational opportunities.

The Department of Labor is a partner not only with other Federal agencies including the Department of the Interior, but also

tribal governments and other Native American organizations that

deliver job training services. Our partners include the 186 Indian

and Native American Workforce Investment Act section 166 grantees. These partnerships are based on shared responsibility for program accountability and improved program outcomes along with a

commitment to leverage resources outside of BIA.

For its part, ETA has worked cooperatively with Indian grantees

to improve the program and maximize the impact of these funds.

The partnerships ensures that Native people and Native communities have the opportunity to be active participants in the American economy.

Under WIA there are two distinct Indian programs. One is a

year-round program for both youth and adults and the other is a

supplemental summer youth program.

The year-round program authorized under section 166 of the

statute was designed to improve the economic well being of Native

Americans. It provides training, work experience, and other employment-related services and opportunities. The program serves

approximately 22,000 Native people annually in all areas of the

United States, including those participating in the demonstration

program under Public Law 102–477, the Indian Employment

Training and Related Services Demonstration Act of 1992.

This demonstration program allows the combining of funds for

employment and training activities from several Federal departments to be administered under a single grant by the BIA and coordinated at the tribal level. Currently, 48 tribal and Alaska Native entities participate in the demonstration program, 44 of which

receive WIA section 166 funds. These 48 entities represent about

250 federally recognized tribes and Native Alaskan villages.

Because of a reduced administrative workload and the flexibility

the single grant provides, some of these grantees have more than

doubled the number of participants they serve.

The other main ETA program is the Supplemental Youth Services Employment and Training Program also authorized under section 166 of WIA. The law reserves funds specifically for services to

Native American youth in reservation areas and in Alaska, Okla-
4

homa and Hawaii. The program serves about 10,000 Native American youth each year.

These two programs represent the main source of support for employment and training services for Indians and Native Americans

for which the President’s fiscal year 2003 budget requests a total of $70 million. Of this, $55 million is for the WIA section 166 Indian and Native American Program. About $15 million is for the

Native American Indian Supplemental Youth Services Program,

which represents 1.5 percent of the total WIA youth formula-grant

request as mandated by law.

In addition, the Department of Labor supports a variety of other initiatives. ETA has awarded six competitive grants totally $29

million to American Indian and Alaska Native grantees for youth

programs. These are the so-called Youth Opportunity Grants.

Under the Senior Community Service Employment Program, the department provides over $6 million to subsidize part-time community service jobs for about 700 low-income Native Americans, aged

55 years and older, on reservations and other areas. Participants

serve their communities in positions such as nurse’s aids, teacher’s

aids, clerical workers, while gaining skills to move into unsubsidized employment.

The department has also awarded National Meeting Grants to

Native American entities to serve dislocated workers. For example,

the Lummi Tribe of Washington State is receiving up to $1.5 million to assist dislocated fishermen and the Salish-Kootenai Tribe in

Montana has received about $2.8 million to assist workers dislocated during wild fires and now includes funding for the downturn in the timber industry.

Although the authorization to make grants for Indian and Native

American Welfare-to-Work programs has expired, the department

has issued regulations and procedures that enable those tribal

grantees with remaining Welfare-to-Work moneys to expend them

within the recently extended time period on those participants who

can best benefit from that effort.

The funds requested in the President’s budget will help greatly

in assisting tribes and Indian organizations to meet the employment and training needs of their communities. However, we must

also continue our partnership efforts to strengthen the program

and involve other areas of society such as the private sector and

community and faith-based organizations if the overall effort is to

be successful.

In concert with our partners, we have many significant accomplishments thus far in program year 2001, which ends July 30 of

this year. We have, among other things, streamlined regulations,

increased the capacity of grantees to manage grants, implemented

an information technology project that puts over 120 grantees on

to the information super highway and enables them to report on

line.

We have increased peer-to-peer technical assistance and training

and we have improved the hourly wage rate for participants placed

in unsubsidized jobs. Now, the most recent Indian and Native

American employment and training data available are for the program year that ended June 30, 2001. That was program year 2000.

During that program year, the section 166 adult programs had an
5

overall entered employment rate of 54.1 percent and a positive termination rate of 83.4 percent.

A positive termination occurs when a participant begins to work,

earns a diploma or completes training. Participants placed in unsubsidized employment at an average hourly wage of $7.70 per

hour, which was significantly higher than the average pre-program

wage of $5.47 per hour.

Mr. Chairman, before concluding, I wish to address two concerns

that I know that you probably have. The first one relates to filling

the vacancies on the Native American Employment and Training

Council and the second one concerns the Solicitation for Grant Applications WIA section 166 program funds.

The Native American Employment and Training Council currently has nine vacancies. I want to assure you that we are working to fill those vacancies as quickly as possible. I personally have

been involved in that. We had some slippage in appointing members to all of our advisory councils at the department. I could give

you a long litany of excuses; some of it has to do with the terrorist

attacks that occured on September 11. But we are moving ahead

now and we think we will accomplish that very soon.

In addition, I would mention the Solicitation for Grant Applications. As you know, that is generally published in the fall. We are

a little bit late on that, though that has not imperiled any grantees

funding. It is always out with plenty of time to cover contingencies.

I am happy to announce that it has been approved and likely to

be published later this week.

Mr. Chairman, our investment in Indian and Native American

employment and training programs will allow many of the most

disadvantaged Americans to acquire the skills they need for productive careers. It is our strong belief that this is a worthwhile investment.

Mr. Chairman, this concludes my prepared statement. I would be

happy to answer any questions that the committee has. Thank you.

The CHAIRMAN. Thank you very much, Mr. Dye.

According to the President’s budget request, the Youth Opportunity Grant Program will be severely cut. As a result, six tribes,

a tribal consortia, and Alaska Native organizations that are now

providing comprehensive services to Native youth in very high poverty areas may have to terminate their activities. What will be the

reduction in these grants?

Mr. DYE. Well, unfortunately, Mr. Chairman, I think there has

been some misinformation, particularly in the press. Under the

Youth Opportunity Grant Program we funded 36 sites, six of which

are Native American grants. There were plans, but not yet funded,

to add additional sites.

The President’s budget this year did not include funding for additional grants, but it did continue the existing grants. From the beginning the existing grants were funded on a declining scale over

a period of 5 years dropping to 75 percent, in the third year to 50

percent of their original amount in year 5.

We are still intending, and the President’s budget contemplates,

keeping that funding schedule although there might be a small

shortfall. We are looking at ways we might reprogram money to

meet any shortfall. At the very worst it would amount to a de-
6

crease of, I think, about at the most $200,000 for the largest

grants.

So, the good new is, Mr. Chairman, that those grants will continue for the five years as originally planned. They are demonstration grants, which means that they were not intended to run forever. They were seed money for a five-year period and it was intended that the funds should be picked up by other sources eventually.

The CHAIRMAN. It will continue for five more years but with

much less funding?

Mr. DYE. Yes; at the rate originally contemplated in the grant,

yes. The third year would go for another two beyond the current

year.

The CHAIRMAN. Twenty-five percent of the original grant?

Mr. DYE. Well, eventually now it is 75 percent. It declines in the

fifth year to 50 percent.

The CHAIRMAN. Do you think you can carryout the purposes of

this program with such reductions in funding?

Mr. DYE. Well, yes. I think that was certainly the plan when the

original grant was contemplated that they would operate on that

funding schedule.

The CHAIRMAN. Well, we will be monitoring this to see how it

turns out.

Mr. DYE. Yes, sir.

The CHAIRMAN. The administration has requested the minimum

amount authorized under the Workforce Investment Act for the Indian Comprehensive Service Program, which is $55 million. Has

the department made any attempt to calculate the need of these

services based on the size of the population, the employment barriers, et cetera?

Mr. DYE. Well, the existing program is based on a formula that

takes population into consideration. It is pretty much level funding.

It has been over the past several years. So, with the funding available, we do, by formula, restrict it by population.

The CHAIRMAN. Don’t you believe that if you study the size of the

population and the barriers to their employment, the minimum

amount would not suffice?

Mr. DYE. Well, we do the best we can with what we have, sir.

I think we do look at the population statistics on a regular basis.

Mr. DELUCA. We do, but we work basically on a formula that is

census-based and that formula will not change until the 2000 census figures are given to us in a usable fashion. The program has

been essentially constant for a number of years at $55 million. It

has gone up and down a little bit.

The CHAIRMAN. The procedure for designating tribes and organizations as grantees for the Indian Workforce Investment Act Program should have started last September, but I gather that you

just began last week. Is this delay the events of September 11?

Mr. DYE. Partially, yes.

The CHAIRMAN. Do you mean 9/11 delayed it this long?

Mr. DYE. No; I don’t want to use that to explain away everything. But those events did put a lot of strain on the department

in a variety of ways, though I won’t offer that as a totally exculpatory excuse for everything.
7

The CHAIRMAN. With this delay, can you assure that Section 166

Supplemental funds will be available by April first?

Mr. DYE. Yes; we are very confident of that.

The CHAIRMAN. I presume they will be available to all grantees

by that time?

Mr. DYE. Yes.

The CHAIRMAN. I have several other questions that we will be

submitting to you for your consideration.

Mr. DYE. We will be happy to answer them promptly, Mr. Chairman.

The CHAIRMAN. Vice Chairman Campbell?

Senator CAMPBELL. Thank you, Mr. Chairman. Mr. Dye, it is nice

to see you here. You had a long, extensive and very good career

with the Senate Energy Committee and in the House before that.

You bring an awful lot to this job and I am very happy top see you

there.

Mr. DYE. Thank you.

Senator CAMPBELL. I wanted to ask you several questions dealing

with employment. You probably know as well as I do that much of

the poverty on Indian reservations is related to the lack of jobs.

I don’t think it is out of the question to assume that any place,

the inner cities, the barrios, whatever, when you have high unemployment you have some real social problems that go along with it.

So, I have always tried to emphasize job creation and education.

Let me ask you first of all, do you track unemployment training

needs for individual Indians themselves, but also the needs of the

employers that are looking for people to work in your department?

Mr. DYE. Well, I don’t think we have done as much of that as

we probably ought to have. My boss, Assistant Secretary Emily de

Rocco, is placing a very strong emphasis now on trying to forge better partnerships with business. After all, those are the entities, the

engines of job creation. We want to move away from the past where

we may have trained people sort of not completely cognizant of the

real opportunities out there or worked with employers to create

more opportunities.

We need to train people for jobs, jobs that exist or jobs that are

going to be created in time for people to get them. So, we have a

lot stronger emphasis now on working with businesses.

Senator CAMPBELL. Well, I certainly would encourage you to do

both of those kinds of tracking. It doesn’t do any good to train

somebody for a job if there is no job, especially when there are

some industries in America that need people. I am a big supporter

of any kind of education, but clearly a lot of the job sector is not

in an academic education.

If a young person wants to become a doctor or a can you professor, I certainly support that. Even if he wants to become an attorney I would probably support it, although we have nothing against

your profession, we have so darn many of them now, that is probably a field that we don’t need to put so much emphasis on.

But, vocational training, I think we are really missing the boat

somewhere with the Labor Department in trying to hook up opportunities with needy Indian people. Let me give you just one example, and I would hope that you would put it in your think cap.
8

I have a bill in that will create Labor Department grants for

training people who want to drive trucks. That sounds a little bit

crazy, I guess, but if you track the needs of the trucking industry,

last year they were short 200,000 drivers. In fact, they are talking

about importing people from foreign countries just to teach them

to drive because there is such a shortage of drivers.

If a person gets out of college with a B.A. and goes into teaching, he can probably get $35,000 a year as a beginning teacher. But

some of these truck drivers are making $50,000 to $60,000 a year.

If they are what they call team drivers, husband and wife, some

of them are doing over $100,000 a year. It is really a good paying

profession. In a vocational sense, it is a lot of money.

I know a number of Indian people in Montana, not a number, but

a few that are working for one trucking company that I think is

out of Billings called Dick Simon. I talked to them. They tell me

it is great. They don’t get home as often as they would like, but

they are home almost every weekend for two days. But the pay

really makes a difference because they can live on the reservation

and still make a good income.

Well, it would seem to me that we have to make some way to

hook people up that need those jobs when we know the trucking

industry needs those drivers. I noted some of the things that come

across my desk, the Mid–America Truck Conference is in Louisville, Kentucky the week after next. They expect 75,000 people to

come to that thing. That is how big that industry is. In there there

will be over two dozen recruiters, recruiters from every major

trucking company in the United States, Mayflower, Werner and all

these big guys. They have full-time people trying to recruit.

If you go to a truck driving school, when you get out of that

school you probably get ten calls from trucking companies around

that will even reimburse the cost of going to the truck driving

school if you will sign a contract to go to work for them.

Somehow, we have got to find opportunities like that for Indian

people. I know they are there. I just mentioned the truck industry

because I am pretty close to it. But there are other industries that

must have an equal amount of opportunity and we are going like

this. The Indians need the job and we have the industry that needs

the people and we can’t seem to hook them up.

Well, it seems to me that part of the Labor Department’s obligation is to try to hook them up, particularly if they are as interested

in job creation for Indian people as I am. Would you maybe look

at that bill I introduced and give me some feedback on how we can

do that, how we can create that, at least in that one industry

where we know that there is that many jobs available?

Mr. DYE. Yes, I would be happy to look at the bill, but I would

like to say I couldn’t agree with you more. We do need to look at

a number of our vocational offerings. One thing, the President has

stated a very clear preference to work more closely with community

colleges, including tribal colleges and try to look at a number of

these vocational offerings.

I know there are plenty of truck driving jobs that go begging, not

just in long haul jobs, but for instance I know in the oil and gas

industry they are begging for people in some places. Also in the oil

and gas industry, for instance, and this is something I happen to
9

know a little bit about because of my former life, there is a real

shortage of platform workers in exploration and work-over drilling.

They can’t find people to do that. Well, that is another job that

would be real good for folks that are in Indian country because it

is another kind of job where you can leave for a time and come

back. It doesn’t require permanent relocation.

It is a decent paying job, hard outdoor work, but I think it is the

kind of thing that people are willing to do. I know, for instance, we

are looking at the Southwest. There is some work being done in

that area. San Juan College in Farmington, New Mexico, for instance, is looking at jobs in the oil and gas industry. They have a

couple of industry champions there and I have been told that the

Navaho Nation, they have been so good at actually getting jobs,

real jobs, for Native Americans that the Navaho Nation now has

kicked in some money in this effort.

Just last Friday I was talking to labor officials from New Mexico.

We are interested in talking about that program and similar programs.

Senator CAMPBELL. Well, it has been my experience that Indian

people are not afraid of hard work, not afraid of even dangerous

work. What they want is an honest day’s pay for an honest day’s

work. You will find in some places they are exceptional.

Firefighters, more and more firefighters in the summer are coming from Indian Reservations, as you probably know, smoke jumpers and the people that really are in danger. They excel at that.

They excel at high-rise steel working in New York City, as you

probably know, too.

There are a lot of jobs out there. We just are not making the connection. But it would seem to me the Labor Department’s responsibility is to try to make that connection.

Let me, before I run out of time here, I am encouraged by your

participation in this tribal economic development forum. Let me

ask you a couple of things. Has the forum resulted in regulatory

changes to encourage businesses on reservations, do you know?

Mr. DYE. Not yet, but we are working on it, I am told.

Senator CAMPBELL. Okay. Then you might have the same answer

if I asked you if you identified opportunities on Indian lands?

Mr. DYE. I will have to talk to somebody who has been a participant in that meeting.

Senator CAMPBELL. Well, it might be a little premature.

Mr. DYE. The answer is we are working on it. But if you would

like us to give a little better answer for the record, we will be glad

to do that.

Senator CAMPBELL. I would. If you could give us at least a

progress report on what you have done to encourage on- the-reservation job creation, on the ground job creation. If you could provide that for the committee, yet, I would appreciate it.

Mr. DYE. I do think, getting back to your earlier point, that is

very, very important, because you can train people until the cows

come home, but if there aren’t jobs there, you are not really going

to get very far.

Senator CAMPBELL. Give some thought to training drivers, too,

and get back to me with that, too, would you?

Mr. DYE. Yes.
10

The CHAIRMAN. I just have one question, since you brought up

the Native American Employment and Training Council, I gather

there are nine council member vacancies?

Mr. DYE. Yes, sir.

The CHAIRMAN. What do you propose to do with these vacancies?

Mr. DYE. We propose to fill them as soon as possible.

The CHAIRMAN. How long will that be?

Mr. DYE. Well, I would like to do it tomorrow but the Secretary

has to do that and there is a certain amount of vetting that goes

on. I am putting my personal attention to it, as is my boss. As soon

as we can get that in front of the Secretary and do it, we will do

it as quickly as we can, sir.

The CHAIRMAN. In the selection process, do you consult with Indian Country?

Mr. DYE. Yes, we do. In fact the nominations come from tribes

and other Native American entities. So, they are involved and the

council is involved. I would just say one thing about the council.

It is down to about half strength but it continues to function. We

have several working groups, in fact I met with one of them a week

ago, just a week ago, and work is getting done.

Obviously, with some people not appointed it is not represented

quite as broadly as it is now, but we are still seeking its advice and

it is a strong and functioning committee. Actually, they do work

and I do rely on them heavily. Mr. DeLuca is in charge of those

meetings. We are chugging along and we are talking to people in

Indian Country.

The CHAIRMAN. I thank you very much, Mr. Dye.

Mr. DYE. You are welcome.

The CHAIRMAN. Our next witness is the Director of the Office of

Community Services, United States Department of Health and

Human Services, Mr. Clarence Carter.

Mr. Carter, welcome to the committee, sir, and you may begin.

STATEMENT OF CLARENCE CARTER, DIRECTOR, OFFICE OF

COMMUNITY SERVICES, DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Mr. CARTER. Thank you, Mr. Chairman.

Mr. Chairman, Mr. Vice Chairman, and members of the committee, thank you for providing me the opportunity to testify today. As

director of the office that administers the Tribal Temporary Assistance for Needy Families Program, Tribal TANF, and the Native

Employment Works Program, acronym NEW, I am pleased to discuss with you these important Native American programs as we

look to reauthorization of welfare reform.

While I do not administer the Administration for Native Americans, I know that the social and economic development strategies,

environmental quality and National languages preservations program under the Native American Programs Act play a vital role in

supporting Indian and Native American self-determination and the

development of economic, social and governance capacities of Native American communities.

My written testimony includes information on the important

work of these programs. I would like to use my time this morning

sharing information on the current status of the Tribal TANF and
11

the Native Employment Works programs and then turn to what we

see as the next steps, including aspects of TANF-free authorization

that will impact tribal programs.

The Tribal Temporary Assistance for Needy Families was part of

welfare reform in 1996. Welfare reform gave tribes the opportunity

to operate their own TANF programs in order to meet the unique

needs of tribal families and move them toward self-sufficiency.

Tribes have the option to receive direct Federal funding to design

and operate TANF programs or they may choose to rely upon

States to provide TANF services to tribal families. Although States

operated family assistance programs for 60 years, operating TANF

is a new responsibility for tribes. Tribal, Federal and State governments have worked in partnership as tribes have taken on this

major new responsibility.

HHS has provided assistance to tribes through conferences and

meetings, technical assistance and information exchange as tribes

consider whether to administer TANF programs themselves and as

they operate their own tribal TANF programs. The number of tribal TANF programs continues to increase each year.

The first two tribal TANF programs began in July 1997. Currently, there are 36 approved tribal TANF programs in 15 States,

encompassing 174 tribes and Alaska Native villages. These programs serve a combined caseload of approximately 23,000 families

with an estimated 65,000 individuals.

An additional eight tribal TANF plans are currently pending involving 12 tribes with an estimated caseload of 6,000 families and

as many as 20,000 individuals.

There is no separate funding source for tribal TANF programs.

Each tribe’s TANF funding is taken from the appropriate State’s

TANF block grant, based on fiscal year 1994 AFDC caseloads for

Indian families residing in the service area identified by the tribe.

In addition, most of the 15 States in which tribes are administering their own TANF programs have chosen to provide funding and/

or in kind supports to further tribal efforts.

Thirteen of the States in which tribes are administering their

own TANF programs including Alaska, Arizona, Minnesota, New

Mexico, Oklahoma, Utah, Washington, and Wyoming are providing

additional funding assistance to tribes and are claiming these expenditures to meet their TANF maintenance of effort requirements.

Several of them also are providing additional resources such as

computers, staff training, reporting support and access to the

State’s reporting systems. Many of them are working in collaboration with tribal TANF programs in referrals, information exchange,

and eligibility assessment and determination for other programs

such as Food Stamps and Medicaid.

Some States collocate and out-station State employees with tribal

programs to provide intake and assessments in a current one-stop

operation. Tribes have broad flexibility in designing their programs

and, like States, are making varied choices to meet their own

unique circumstances.

Time limits on receipt of benefits vary. Under the work requirements, participation rates and the number of hours of work required per week also vary from plan to plan. Like work activities

and benefits, support services vary greatly from one tribe to an-
12

other, with tribes tailoring them to fit the unique needs of their

service populations.

Also, I would like to talk for just 1 minute about the Native Employment Works Program. The NEW program replaced the Tribal

Job Opportunities and Basic Skills Training Program and provides

funding for tribes and inter-tribal consortia to design and provide

work activities to meet the unique employment and training needs

of their populations to help tribal service populations become selfsufficient.

The statute restricts eligibility for the Native Employment Works

Program to tribes and Alaska Native organizations that operated

a JOBS Program in fiscal year 1995. Currently, all 79 eligible

tribes and organizations receive new program funding.

Tribal TANF and Native Employment Works Programs are addressing the needs of tribal service populations and have enabled

thousands of clients to move to unsubsidized employment. However, tribal members, especially those in rural areas, continue to

face major barriers to self-sufficiency.

Unemployment is high in most tribal communities and those employed often earn poverty level incomes. Tribal members often have

low levels of education and job skills and lack transportation and

child care. Helping these families leave welfare for work requires

that special attention be given to providing effective job preparation and supportive services and realistically addressing the prospect for job opportunities on the reservation.

As part of eight TANF reauthorization discussions held throughout the country, Health and Human Services held a tribal TANF

listening session in San Francisco in October 2001 where tribes

shared their experiences and perspectives on TANF programs.

The tribal listening session and other tribal input showed that

tribes see the tribal TANF and the Native Employment Works Programs as valuable resources to help meet tribal needs and support

self-sufficiency for tribal families.

Tribal TANF programs will benefit from the changes proposed in

the administration’s plan for reauthorizing the TANF program. For

example, tribes would be the beneficiaries of technical assistance

provided under proposed new research, demonstration and technical assistance funds.

Additionally, tribes will benefit from the proposed demonstration

research projects that are intended to promote family formation

and healthy marriages and they also can benefit from the administration’s matching grant program to promote healthy marriages

and reduce out-of-wedlock births.

Tribal TANF and Native Employment Works Programs also will

have the added flexibility granted to States to use reserve funds for

more basic assistance needs.

Finally, tribes can take advantage of the administration’s proposed approach for maximizing self-sufficiency through work and

additional constructive activities. As you know, our proposal for

TANF reauthorization includes the creation of a new universal engagement requirement that includes planning activities and services and monitoring participation and progress.

We know that it is especially important to tribes with significant

challenges to combine services with work programs in creative
13

ways. Tribes will continue to have the flexibility to negotiate customized programs that are compatible with our proposals on case

management, work and services to meet the needs and challenges

of their communities and economic circumstances.

We look forward to working with Congress in reauthorizing these

programs. If you have any questions, I would be happy to try to

answer them at this time.

The CHAIRMAN. Well thank you very much, Mr. Carter. May I

begin by asking, what is the unemployment figure for this Nation?

Mr. CARTER. I think the most recent figure is some place in the

mid-4 percent. Did you say for the country?

The CHAIRMAN. For the whole country.

Mr. CARTER. I think it is some place in the mid four percent, the

unemployment rate, yes. You asked me what was the unemployment rate for the Nation, correct?

The CHAIRMAN. What is the unemployment rate for the Nation,

for all peoples?

Mr. CARTER. It is my guess, I think it is some place in about the

mid 4-percent range.

The CHAIRMAN. What is the unemployment rate in Indian country?

Mr. CARTER. We have looked at unemployment figures on reservations. In some instances those unemployment rates are as high

as 50 percent.

The CHAIRMAN. What is it for Indians residing outside the reservation in urban areas?

Mr. CARTER. I am sorry; I don’t have that figure specifically.

The CHAIRMAN. Are individual Indians eligible for State-operated

TANF Programs or is it just for non-Indian families?

Mr. CARTER. No, sir; individuals would also be eligible. Individuals who are parents of children in an eligible family may receive

employment and training services.

The CHAIRMAN. How many are served by State-operated programs? Do you have any idea?

Mr. CARTER. I don’t have a direct figure for how many Native

Americans are served specifically by State TANF programs, but I

can attempt to find that information and provide it for you.

The CHAIRMAN. I would appreciate that.

Mr. CARTER. Yes, sir.

The CHAIRMAN. Under the welfare reform law, States are required to provide equitable access to Indians under the State TANF

programs, but there is no enforcement mechanism. How will the

administration use the fiscal year 2003 funds to ensure that Indians are provided equitable access?

We have received complaints that Indians are being denied service.

Mr. CARTER. Mr. Chairman, I have not been privy to that information. I would like to be able to look into it and report back to

you on it.

The CHAIRMAN. I would appreciate that. If you feel that we

should have some enforcement mechanism, I would be most

pleased to receive your recommendation.

Mr. CARTER. We will look into it and share that information with

you.
14

The CHAIRMAN. Unlike States which have received Federal support for infrastructure building over 60 years, tribal TANF programs do not receive support costs or start-up money from the Federal Government. This, I believe, places tribes in financial risk as

many lack the infrastructure needed to administer TANF programs.

Is there any mechanism in existing law which would allow the

department to provide infrastructure funds to tribal TANF programs?

Mr. CARTER. There is no mechanism in the existing TANF structure. There are some opportunities in the President’s proposed

2003 budget that would provide for additional technical assistance

for tribes and States as they put in place TANF programs, but

there is no existing mechanism for infrastructure support specifically for tribes.

The CHAIRMAN. Without that, can they be assured of equal access?

Mr. CARTER. I think in the first 6 years of experience that we

have with tribal TANF we have seen a number of tribal organizations and consortia be able to put in place TANF structures that

are, I would say in some instances, the rival of State organizations.

So, there does exist the opportunity now to construct tribal TANF

programs that work well with the current construction; that doesn’t

suggest that the issue of infrastructure should be ignored.

The CHAIRMAN. The President’s summary included numerous

proposals for States including a contingency fund and supplemental

grants.

My question is: Will Indian tribes have access to the same kinds

of moneys as States supplemental grants and contingency funds or

will those funds be limited to States?

Mr. CARTER. In order to speak on that, I am going to need to get

some clarification, it is my understanding that those are being

made available to States, but I want to make sure.

The CHAIRMAN. I would hope you would look into that because

I gather that the policy is equal access. If that is the policy, then

Indian country should have access to those resources as well.

Does your department coordinate its Administration for Native

American grants with other programs such as the TANF program

or consult with other agencies such as the Commerce Department

in order to assure the most efficient use of funds?

Mr. CARTER. Prior to my arrival, I would tell you that I don’t believe that our coordination in our approach to providing services to

Native Americans was as coordinated as it could be. We have aggressively, I mean during my short tenure, attempted to build some

of those relationships, built some new relationships and repaired

some existing ones.

For instance, we are currently in conversation with the Administration for Native Americans to make available through Community Economic Development funds some projects on Indian reservations to deal with economic development on reservations.

It is those kinds of new relationships which we think we can

forge across department lines which will help us strengthen our approach to strengthen Indian country.
15

The CHAIRMAN. I believe all witnesses will agree that there is a

great need for employment and training opportunities. Yet, I know

that this budget request reduces funding for the Administration for

Native Americans, ANA given rates of inflation. This is the agency

that provides seed money to bring about employment and training

opportunities in Indian country.

Would you object if we added a few dollars to this?

Mr. CARTER. Mr. Chairman, no, I don’t think, on behalf of Indian

country, I don’t think Indian country would object at all: However,

our budget proposes only a small reduction in ANA funding, of less

than three-quarters of $1 million.

The CHAIRMAN. I have many other questions. I will submit them

to you for your consideration.

But I have just one more question.

Mr. CARTER. Yes, sir.

The CHAIRMAN. The authorization for ANA, the Administration

for Native Americans, will expire on September 30 of this year. Although the president requests funding for the administration for

fiscal year 2003, will the president request reauthorization of the

Native American Programs Act?

Mr. CARTER. Mr. Chairman, it is not my position to be out in

front of the President on his objectives. But my suspicion is that

there is funding proposed for 2003. We have, in fact, requested a

straight line reauthorization of this program.

The CHAIRMAN. You are not in the loop on the authorization?

Mr. CARTER. No, sir; I am not.

The CHAIRMAN. I thank you very much, Mr. Carter.

Mr. Vice Chairman.

Senator CAMPBELL. Thank you, Mr. Chairman.

Mr. Carter, you heard the chairman mention unemployment and

you responded with what you thought the national unemployment

rate was and the unemployment rate on Indian reservations. I

have to tell you that there are many people in Indian reservations

that are permanently unemployed and it has been so long since

they have had a job, they gave up. This fact is hidden when we

look at Indian unemployment rates. You find that in some inner

cities, too, as you probably know. They don’t reflect on the unemployment roles because they just gave up.

But as I understand it, if you look at, say, inner city unemployment it hovers between 25 and 30 percent in the worst places.

There are Indian reservations in the United States right now that

have 80 percent, 80 percent, in North and South Dakota.

I see the Senator from North Dakota is here and he can verify

that. I don’t know of any place in the world, other than Bangladesh

and Afghanistan that have unemployment that high, very frankly.

I think it is a national disgrace that we can’t do better in providing

jobs for Indian people in the richest nation in the whole darn

world. We still have that kind of unemployment with all the social

problems that go with us, whether it is suicide or alcohol abuse or

all the stuff that seems to spawn from not having a productive job.

That is what we face on Indian reservations.

But let me talk to you a little bit about the ANA funding since

the chairman focused on that, too. I think it is good, but what is

the rationale for reducing the funds for ANA in 2003 since we
16

know that it has helped in language preservation, economic development, a number of other things.

Mr. CARTER. I’m sorry, Mr. Vice Chairman, that was a reduction

in——

Senator CAMPBELL. Oh, excuse me. That is ANA.

Mr. CARTER. There is no reduction in tribal TANF.

Senator CAMPBELL. What was the rationale for reducing the

funds in ANA, do you know?

Mr. CARTER. No, sir; I do not.

Senator CAMPBELL. Okay, let me get back to TANF funding if

you don’t know that. We are going to be dealing with the welfare

reform bill, the reauthorization, very shortly. We are going to be

reauthorizing that. You noted that there is no separate funding

source for TANF and that it sometimes is taken from the State’s

allocation. I know how that works. That is, tribes don’t get it or

they are kind of on the back end. It is like getting water from an

irrigation system where there are 10 guys in front of you and you

are the last one in the ditch. You kind of get what is left over.

Unfortunately, Indian tribes, a lot of times, that is what they

face when they have to go through the State bureaucracy to get

money that is filtered to the State.

My question is, wouldn’t it be more efficient to provide TANF

funds directly to the tribes?

Mr. CARTER. Mr. Vice Chairman, I understand your analogy, but

I would tell you that the way that this works is that, by the 1994

caseload data that States provided to the Federal Government

which sets the baseline for their funding, outlined in that data is

the amount that the State expended for Indian country.

So, as the service population has declined, those dollars are cut

right out, at the Federal level, they are cut right out of the State’s

allocation. So, we do that carving at the Federal level and then

subtract that from the State’s allocation.

Senator CAMPBELL. Do you mean they don’t go through the State

at all; they go directly to the tribe from the Federal level?

Mr. CARTER. They do go directly to the tribe, if they are cut out

from the State’s overall allocation.

Senator CAMPBELL. Okay, maybe one last question. That is on

the 477 program that authorizes integration and coordination of

Job Programs. It is my understanding the department has been a

little bit slow to implement the amendments that we passed in

2000.

Would you care to comment on that?

Mr. CARTER. Mr. Vice Chairman, when I arrived at the Office of

Community Services there were some issues brought to my attention about the way that we operated Public Law 102–477 and we

did not have in place an appropriate mechanism to ensure that we

were properly protecting the responsibilities and the funding

sources of the Department of Health and Human Services.

We have entered into negotiation with the tribes and the Bureau

of Indian Affairs and we have worked out all of the challenges that

we had laid out for us, I think, in a very collaborative way. The

funding never stopped during that time. It was simply rerouted.

But I think that all parties would concede that we have worked all

the difficulties out of it.
17

Public Law 102–477 will work just as Congress intended it to

work, as allowing tribes to take a very integrated approach to making themselves more healthy.

Senator CAMPBELL. You probably know that there are a few very

successful tribes now. Some have done very well through gaming

and natural resources. Most have not, but a few have. Some of the

tribes that have had successes are using their own funds to either

supplement or replace some of the Federal funds.

They found that going through the bureaucracy is just too much

trouble. It is easy for them to use their own money. Have you seen

any reduction in the demand for Federal programs under TANF for

services in the communities that have had, say, gaming interests?

Mr. CARTER. No, sir, Mr. Vice Chairman. In fact since 1996 when

welfare reform passed and we had the first two tribes to make application to run tribal TANF, we have actually increased over the

intervening years to 36. We currently have eight applications pending.

I will tell you that it is an arduous discussion among the tribes

to determine whether or not operating the program is in their best

interests. There are times when consortia are necessary because a

tribe may be too small to operate the program on their own. But

we see an increasing interest on the part of tribes to take this opportunity to help put this program in place that would benefit their

health and welfare.

We see it as our responsibility at the Department of Health and

Human Services to provide all the information and technical assistance so a tribe can make a determination in their own best interest.

Senator CAMPBELL. I see. Thank you, Mr. Carter.

Thank you, Mr. Chairman.

The CHAIRMAN. I thank you very much.

Mr. CARTER. Thank you, Mr. Chairman.

[Prepared statement of Mr. Carter appears in appendix.]

The CHAIRMAN. Our next witness is the deputy assistant secretary, Office of Elementary and Secondary Education, Department

of Education, Tom Corwin, accompanied by Cathie Martin, acting

director, Office of Indian Education.

Mr. Corwin.

STATEMENT OF TOM CORWIN, ACTING DEPUTY ASSISTANT

SECRETARY, OFFICE OF ELEMENTARY AND SECONDARY

EDUCATION, DEPARTMENT OF EDUCATION, ACCOMPANIED

BY CATHIE MARTIN, ACTING DIRECTOR, OFFICE OF INDIAN

EDUCATION

Mr. CORWIN. Thank you, Mr. Chairman. I am accompanied this

morning by Cathie Martin. Cathie is our acting director in the Office of Indian Education. I am actually an acting deputy assistant

secretary. Cathie and I are pleased to appear before you this morning to discuss the fiscal year 2003 budget request for major Department of Education programs that serve American Indians, Alaskan

Natives, and Native Hawaiians.

With the chairman’s permission, I would like to summarize the

remainder of my testimony and ask that the full text be placed in

the record.
18

The CHAIRMAN. Without objection.

Mr. CORWIN. Mr. Chairman, the Bush administration is strongly

committed to ensuring that American Indians, Alaska Natives, and

Native Hawaiians receive every opportunity to achieve to high academic standards.

The recently enacted ‘‘No Child Left Behind’’ Act focuses on improving academic achievement by ensuring that all children can

read by the end of the third grade, improving teacher quantity

through high-quality professional development and innovative

teacher recruitment and retention practices, increasing accountability for student achievement and placing a stronger emphasis on

teaching methods grounded in scientifically-based research.

Native American students will benefit from these initiatives and

many programs at the Department of Education help to ensure

that Indian students have full access to these and other reforms to

improve education.

The 2003 budget request includes a number of programs and initiatives that focus specifically on helping Indian students achieve.

In my remaining time I would like to highlight just a few of these

programs.

Our request for the department’s Indian Education Programs is

$122.4 million, an increase of $2 million over the 2002 level. These

programs include formula grants to school districts, competitive

programs, and national activities to further research and evaluation on the educational needs and status of the Indian population.

We are requesting $97.1 million for the Indian Education formula grants. This program is the Department’s principal vehicle

for addressing the unique educational and culturally related needs

of Indian children.

Grants supplement the regular school program, helping Indian

children improve their academic skills, raise their self-confidence,

and participate in enrichment programs and activities that would

otherwise be unavailable.

Our request for special programs for Indian children is $20 million, the same as the 2000 level. These funds will be used for three

activities. Approximately $12.3 million will support an estimated

43 demonstration grants that promote school readiness for Indian

preschool and increase the potential for learning among American

Indian and Alaska Native students.

In addition, the 2003 request will provide approximately $7.2

million to continue the American Indian Teacher Corps initiative

which trains Indian college students to become teachers, places

them in schools with concentrations of Indian students, and provides professional development and in-service support as they

begin teaching.

We are also requesting funds to continue the companion American Indian Administrator Corps. Grantees funded under this activity recruit, train, and provide in-service professional development

to American Indians to become effective school administrators in

schools with high concentrations of Indian students.

We are requesting $5.2 million for research, evaluation and data

collection activities related to Indian education. This is a $2-million

increase.
19

The Department has used the National Activities appropriation

to craft a comprehensive research agenda for Indian education. We

completed and publicly released that agenda last November and

would now use the 2003 funding for the first major initiatives in

implementing that agenda.

The agenda responds to the major national need for better information on the educational status and needs of Indian students and

for scientifically based research on what works most effectively in

meeting the educational needs of this population.

In addition to our Indian Education programs, the Department

also supports the education of Indians through many other, broader

programs. I will just mention a few of those. The remainder are

discussed in my written statement.

Title I provides supplemental education funding to local educational agencies and schools, especially in high-poverty areas to

help some 15 million students, including an estimated 237,000 Indian children and youth, learn to high academic standards. With

title I, these students have the benefit of, for example, extra instruction at all grade levels, extended-day kindergarten programs,

learning laboratories in math and science, and intensive summer

programs. The Department has requested a $1-billion increase for title I in 2003 for a total of $11.4 billion. The BIA share of the appropriation

would be approximately $76 million, a 10-percent increase. These

funds will serve more than 50,000 Indian children in addition to

those served in regular public schools.

We have a new program called Reading First. Reading First is

a comprehensive effort to implement the findings of high-quality,

scientifically based research on reading and reading instruction. It

is one of the Administration’s highest priorities for education. Providing consistent support for reading success from the earliest age

has critically important benefits.

Under this formula program the BIA will receive one-half of 1 percent of the State grants appropriation. Our 2003 request of $1

billion would provide approximately $5 million to BIA schools for

this important new program.

The Strengthening Tribally-Controlled Colleges and Universities

or TCCUs program authorizes 1-year planning and 5-year development grants that enable these institutions to improve and expand

their capacity to serve Indian students. Under the budget request,

the Department would award $18.1 million for activities to

strengthen TCCU’s, an increase of 3.6 percent over the current

level. In the past 2 years, a portion of funds has supported construction and renovation activities and the fiscal year 2003 request

would provide funds for an estimated six construction projects.

The companion Strengthening Alaska Native and Native Hawaiian-Serving Institutions program authorizes 1-year planning and 5-

year development grants that enable these institutions to improve

and expand their capacity to serve Alaska Native and Native Hawaiian students. The Department’s budget includes $6.7 million, a

3.6-percent increase over the current level, for this program.

Finally, a mention of Special Education. The Special Education

Grants to States program provides formula grants to meet the excess costs of providing special education and related services to
20

children with disabilities. From the total appropriation, a little

more than one percent is allocated to the BIA.

Under the budget request of $8.5 billion, a $1-billion increase,

13.3 percent, the Department would provide approximately $81.2

million to BIA to serve approximately 8,500 Indian students.

In conclusion, the 2003 budget request for Department of Education programs serving Indians supports the President’s overall

goal of ensuring educational opportunities for all students including American Indians, Alaska Natives and Native Hawaiians.

My colleague and I would be happy to respond to any questions.

The CHAIRMAN. I thank you very much, Mr. Corwin. The Department of the Interior has proposed privatizing the administration of

schools operated by BIA if an Indian tribe does not elect to operate

the school as a grant school. Does your department have any experience with private organizations that operate schools?

Mr. CORWIN. This is an issue that we are well aware of, but we

don’t have direct experience. Unlike the BIA, we don’t operate

schools ourselves, so we wouldn’t have any opportunity to enter

into that sort of privatization. It has become a serious option for

some of the cities and some of the States across the country in the

last few years, particularly those that are running out of patience

and throwing up their hands at the failure of some of their schools

to provide an adequate education.

It is being debated actively right now in Philadelphia. It has

been tested in Hartford. We have had some experience in Baltimore, San Francisco, and it is a live debate in a lot of places

around the country. Some of the private firms frankly do offer some

exciting ideas for revitalizing the schools, and State Governors,

mayors, and schools boards are looking at that carefully. We are

watching that, but, as I said, we don’t have direct experience.

The CHAIRMAN. Is there any system of reporting or rating these

private organizations?

Mr. CORWIN. I am not aware of any sort of national rating system or of any national reports that really attempt to assess the extent to which they are working. I think the whole phenomenon may

be a little too new to have that sort of national data at this point.

It is possible there are some reports we could look for for the committee that look at the experience in some localities, but I think at

this point it is fairly anecdotal.

The CHAIRMAN. Don’t you think that since we are dealing with

the sensitive minds of young children that something like this

should be done? I ask this in light of a most recent scandal—involving nursing homes. It appears that we have no system to monitor

or to rate them. As a result, old folks who are helpless get beaten,

sometimes to death.

I would like to be certain that moneys we spend would provide

a good and quality education for these young children.

Mr. CORWIN. I think this would be an important area we might

want to invest some of our research funds on. I don’t know if we

could bring it to quite the stage of having a national or Federal rating. We don’t, at the Federal level, certify or approve schools or

school districts. But I think, yes, we could be helpful in providing

better information in this area as it begins to develop.
21

The CHAIRMAN. As you know, there is a 5-percent limitation on

amounts that can be used for administrative purposes under the

Elementary and Secondary Education Act. Now, we are having

complaints that that is not enough. What is your solution?

Mr. CORWIN. Well, we are hearing those complaints as well. I

might like to have Cathie speak about it a little. It is in the law,

however. Our statutes allow for waivers of statutory requirements

in cases where there is an impediment to operating a program or

the statutory requirement presents a hardship.

So, the sort of lead option we have come up with is to permit

waivers of that requirement.

Cathie, do you want to say a little more?

Ms. MARTIN. We are currently providing or preparing guidance

to go in the application packages to inform the potential grantees

on how they can request that waiver. We will process it with their

application.

The CHAIRMAN. Will that be the rule instead of the exception

once this waiver is granted?

Ms. MARTIN. It would become a standard practice within the program to grant these waivers.

The CHAIRMAN. Would there be another limit if there is a waiver? It is now 5 percent. If you grant a waiver, would you say another five percent or is it unlimited?

Ms. MARTIN. They could ask for the entire 5-percent to be

waived.

Mr. CORWIN. We would probably have to review the waiver requests to determine what is an appropriate amount of funding.

Some of these grants are quite small, down to a few thousand dollars, and 5 percent basically doesn’t allow for any administration.

But, of course, you make a good point, you don’t want the entire

or the majority of the grant to be used just for administration rather than services.

The CHAIRMAN. In the fiscal year 2003 budget Alaskan and Native Hawaiian programs were cut. Is there any justification for

that?

Mr. CORWIN. Frankly, coming up with the budget that would fit

within our ceilings was difficult for the Secretary and difficult for

the Administration. We are supportive of those programs, but in

order to fit within the ceiling we had to cut back to a point where

we would be able to continue all the current grants including the

new ones that will start in fiscal year 2002, but would not be able

to make any new grants in 2003.

The CHAIRMAN. The so-called ‘‘No Child Left Behind Act’’ includes authorizations for funding for tribal education departments,

adult education, Indian fellowships, gifted and talented programs,

but there is no funding for these programs. Is there any reason for

that?

Mr. CORWIN. Well, these are programs that have not been funded

in several years, going back to about 1995 and in some cases have

never been funded. As I said, in response to the last question,

budget decisions are always very difficult.

The Administration elected to put funding and serious funding

increases behind the programs that were very central to the mission of the Department and that already were established, some
22

that I mentioned in my testimony, title I, Special Education. One

very important one that I didn’t mention, Pell Grants, is recommended for a very sizeable increase, and our reading initiative.

To at least some extent as well these unfunded authorities, and

we have a lot of them on the books, not just in Indian education,

to some extent they overlap with some of the broader programs in

gifted and talented or adult education. We think the needs could

be met by and large through those broader programs.

The CHAIRMAN. Over the last 5 years the National Advisory Council on Indian Education has been funded at about $50,000.

How much are you requesting for fiscal year 2003?

Mr. CORWIN. Mr. Chairman, I don’t have a number for you. I can

get you something for the record. The Advisory Council no longer

receives a line item in the budget or in the appropriation. That

change occurred four or five years ago when Indian education was

transferred from the Interior Appropriation Subcommittees to

Labor, HHS and Education. The funding for NACIE, that committee, was absorbed within our regular salaries and expenses.

So, I assume somewhere back in the budget documents there is

a number for NACIE. My expectation is that it is probably not too

much higher than last year. But I will provide a precise number

for the record.

The CHAIRMAN. Your department is proposing funds for the

Adult Education State Grant and there is a great need for adult

education funds at the tribal colleges and universities. Are you

going to make funds available to them?

Mr. CORWIN. The adult education State grants flow through the

States and then at the States level there is—I am trying to think

of the technical name for it—sort of equal opportunity for different

types of entities to apply for sub-grants from the States, be they

school districts, community colleges or tribal colleges. The Administration is very supportive of the tribal colleges.

I believe the President may reissue an executive order on tribal

colleges to strengthen the Federal commitment and reenergize the

Federal agencies in their support of the tribal colleges.

I am not aware of a specific authorization in adult education.

That is in a different office. To the best of my knowledge, no, we

have not put in a specific budget item for tribal colleges and adult

education. I say to the best of my awareness; if I go back and find

that there is something, with your permission I will correct the

record on that.

The CHAIRMAN. Do you really believe that tribal colleges are getting equal access and a fair share of the resources

Mr. CORWIN. I don’t know the specific situation in adult education. As I said, it is in a different office. There may be a tradition

in the States where out of habit grants tend to go out to the secondary schools. But as I mentioned, the Administration is definitely committed to promoting those colleges and getting the word

out and doing whatever we can, not just in the Department of Education, but in all the Federal agencies to ensure that they always

get fair treatment and get a fair share of the funds.

The CHAIRMAN. I thank you very much, sir.

Mr. Vice Chairman.

Senator CAMPBELL. Thank you, Mr. Chairman.
23

You just mentioned the possibility of private schools and reservations, first of all. I am really concerned about that. It might present

some real possibilities, but I think that I share the chairman’s concern. There are a lot of unanswered questions about the whole

idea.

First of all, as you probably know, there are only two educational

systems in the United States where the Federal Government is totally responsible for students. One is the military and the other is

with Native Americans. You probably know that. It is our responsibility.

Those schools, they don’t have a real mill-levy tax base. They

can’t pass it on to the taxpayers. They don’t get ‘‘ADA’’ funds from

the States in most cases, none, I don’t think. The average daily attendance that the State pays all schools, the Indian schools don’t

get that. Their total lifeblood comes from this body here in Washington.

When we talk about private corporations running the schools, I

would say there might be some possibilities, but maybe some real

dangers, too, because, first of all, I don’t know if that option has

ever been tried before. I don’t know if they have done it with Department of Defense schools, for instance. I don’t know what the

track record is, what they would bring in terms of the systems

reply about operators.

All that really needs to be looked at, as well as, I think, the tribal concern about whether somehow it would erode the trust responsibility of the Federal Government. It is something that we probably really have to deal with, too, before we move along too far

down that path.

I didn’t want to question you about that. I just wanted to pass

that on to you.

To hear your testimony, I think the casual observer would assume that there had been great strides in assuring educational opportunities to Native Americans. But I have to tell you, it is my

understanding according to the National Education Assessment

Study, only 17 percent of our Indian kids read proficiently. That

means 83 percent couldn’t have read the testimony that you read

into the record. If they could have read it, they wouldn’t have understood it. Functional illiteracy is a big problem. It is not just a

matter of not being able to read the words, but not being able to

understand what they say. You know as well as I do, illiteracy literally prevents them from filling out things like job applications,

which is one of the big concerns of this committee.

I don’t know how we can frankly justify some of the cuts. Senator

Inouye mentioned the $10-million decrease in funding for the Native Alaskans. That is roughly a 41-percent decrease just since

2002. What is going to be the practical effect of that cut?

Mr. CORWIN. As I mentioned to Senator Inouye, we will not be

able to make new awards for the Alaska Natives Program, but we

will be able to continue the current grants, including grants that

we are going to make during fiscal 2002.

I should mention though that that cut is dwarfed by the increases the President is proposing for the larger programs like title

I and the new Reading First initiative. The President has strongly,

in particular, embraced the notion that all children need to learn
24

to read and has cited the kind of data you were talking about from

the national assessment.

Secretary Page believes that reading instruction doesn’t always

reflect what science has now shown works and that we have to do

everything that we can to bring these reading programs along.

Senator CAMPBELL. I missed that again. You said reading does

not reflect——

Mr. CORWIN. Reading instruction in too many schools is not effective. It is effective for some kids, but too many of them are being

left behind, which is why you get these 17 percent statistics. So,

rather than funding some of the smaller programs, the President

is really focusing in on reading instruction and the title I program

which has been comprehensively revised in the last Congress, or

this Congress, I guess, to focus more on what works and to hold

schools accountable for the achievement of all children.

Senator CAMPBELL. Well, I think his initiatives and certainly

Mrs. Bush’s interest and effort on the Reading First programs are

commendable and great. I happen to think that libraries and

schools, I mean they are inseparable. I don’t know you can have

one good program without having the other program, too.

Maybe I have my numbers wrong, but as I understand it, there

is only $62,000 provided through the Literacy Through School Libraries Program. Is there something wrong with the information I

am getting or is that really the amount of money? It is like saying

libraries don’t count or you shouldn’t have them at all if that is all

the money that is in there.

Mr. CORWIN. That is a new program just put in in fiscal year

2002 by the Congress. The total appropriation is $12.5 million. The

amount going to the BIA is $62,500. That appropriation would be

maintained in our budget.

Senator CAMPBELL. $62,000 for the BIA schools?

Senator CAMPBELL. You might as well not give them anything if

we can’t add more money to that program.

I don’t think I have any more questions, Mr. Chairman. Thank

you.

The CHAIRMAN. I have a question. I don’t think that you are in

a position to respond to this, but you maybe able to lead me to

someone who can. We are presently involved in a conflict in Afghanistan. Everyone tells us that it will take much more than a

war to resolve this matter; that a time will come when we will have

to provide assistance in restoring their infrastructure, setting up

their educational system, their health system, their communication

system, et cetera, et cetera.

Has your department been called upon to provide an input in

planning for this future which is so important?

Mr. CORWIN. I am pretty certain that we have. I am not personally involved in it, but I think there are some people in the Secretary’s office or elsewhere who have begun work on that. If it is

okay, I can try and provide more for the record.

The CHAIRMAN. If you could provide names for the record, I

would appreciate that. I thank you very much.

[Prepared statement of Mr. Corwin appears in appendix.]
25

The CHAIRMAN. Our next witness is the Principal Deputy Assistant Attorney General, Office of Justice Programs, Department of

Justice, Tracy A. Henke. Ms. Henke, welcome to the committee.

STATEMENT OF TRACY A. HENKE, PRINCIPAL DEPUTY ASSISTANT ATTORNEY GENERAL, OFFICE OF JUSTICE PROGRAMS,

DEPARTMENT OF JUSTICE

Ms. HENKE. Thank you. First, I would like to ask that my formal

written statement be submitted for the record.

The CHAIRMAN. Without objection, it is so ordered.

Ms. HENKE. Chairman Inouye, Senator Campbell, I appreciate

the opportunity to discuss the Justice Department’s fiscal year

2003 budget priorities for Indian country. As the committee is

aware, for far too long, the needs of Indian tribal governments in

combating crime and violence have been ignored.

This administration is committed to addressing the most serious

law enforcement problems in Indian country, including substance

abuse, domestic violence, and other violent crimes and to ensuring

that Indian tribes are full partners in this effort.

Part of our effort toward meeting these goals is to ensure that

the Justice Department’s workforce reflects the rich diversity of our

nation. We currently have over 900 Native American men and

women serving in the department in many capacities. They include

U.S. Attorneys, FBI agents, Victim-Witness Coordinators, Federal

Indian Law Specialists and others in virtually every Justice Department component.

We also recognize the Federal Government’s unique relationship

with tribal governments and special obligations to Native Americans. At the beginning of our Nation’s history, the founding fathers

established a working principle for interacting with Indian tribes.

Enacted in 1789, the Northwest Ordinance pledges:

That the utmost good faith shall always be observed toward the Indians. Laws

founded in justice and humanity shall from time to time be made for preventing

wrongs to them.

The Justice Department is committed to honoring that historical

commitment by serving as the trustee for tribal resources and the

protector of treaty rights and by preventing, investigating and

prosecuting serious crimes in Indian country.

As I am sure you are aware, Mr. Chairman, violent crime rates

in Indian country are disproportionately high. A Bureau of Justice

Statistics study found that American Indians are victims of violent

crime at rates more than twice the national average, far exceeding

any other ethnic group in the country. And a survey by our National Institute of Justice revealed that one in three Native American women reported being raped in her lifetime.

Like all Americans, Native Americans deserve to live in safe

communities and the Department of Justice is committed to sustained efforts to reach that goal. The Department’s strategic plan

calls for significant improvement in the crime fighting and criminal

justice administration capabilities of tribal governments.

As Attorney General Ashcroft has stated, we will accomplish this

goal in several ways, including focusing our resources efficiently

and comprehensively to improve criminal justice and public safety

in Indian country.
26

Our commitment to American Indian communities is reflected in

the President’s fiscal year 2003 budget request of $202 million for

Indian country related activities for the Department of Justice.

This plan will allow us to continue most of our tribal programs at

or near fiscal year 2002 levels. Our fiscal year 2003 request includes almost $20 million for pro- grams to reduce violence against Native American women, $3 million for programs to improve the investigation, prosecution, and

handling of child abuse cases in Indian country, $5 million for the

Indian alcohol and substance abuse demonstration program, a new

effort to improve the enforcement of alcohol and drug laws in tribal

lands and provide treatments and other services. Almost $12.5 million for the tribal youth program which supports

accountability based sanctions, training for juvenile court judges,

strengthening family bonds, substance abuse counseling and other

efforts to improve Justice operations in Indian country. Almost $8 million is requested for the Tribal Courts Assistance

Program which assists tribes in the development and enhancement

and continuing operation of tribal judicial systems and $2 million

in the Bureau of Justice Statistics for the Tribal Justice Statistics

Assistance Center and other activities to help tribes make better

policy decisions, share information with the broader criminal justice community and participate in national criminal justice datagathering efforts.

In addition to these Office of Justice programs initiatives, the ad- ministration is also requesting $30 million for the Indian country

programs administered by the Office of Community Oriented Policing Services or COPS.

But sustained criminal justice improvements require much more

than just additional resources. Perhaps the most important factor

in combating crime is the will of the community. For this reason,

a core principle of our tribal program is to empower the tribes

themselves to implement and sustain successful crime fighting initiatives.

One example is the Comprehensive Indian Resources for Community and Law Enforcement Projects otherwise known as CIRCLE.

CIRCLE recognizes that the most effective solutions to the problems experienced by tribal communities come from the tribes themselves. The three tribes that participate in the CIRCLE pilot

project are the Oglala Sioux, the Northern Cheyenne, and the

Pueblo of Zuni. They have each undertaken comprehensive, coordinated, multidisciplinary efforts to combat crime and violence.

These tribes design their own strategy while the department provides its support through direct funding, training and technical assistance. As a result of this tribal commitment, we have already

seen some promising results from the three CIRCLE projects, in reducing gang-related crime, in reducing domestic violence, and improving tribal justice system operations.

Throughout these and other initiatives, the Department of Justice will continue working with Native American tribes, government to government, to build safer communities in Indian country.

I want to assure you that I and other members of the current Justice Department leadership stand ready to work with the Congress

to meet this goal.
27

Thank you for the opportunity to be here. I would be happy to

respond to any questions you might have.

The CHAIRMAN. I thank you very much, Ms. Henke.

In its ‘‘Jails in Indian Country 2000’’ report, which was issued

last July by the Bureau of Justice Statistics, it was reported that

Indian detention facilities held 1,775 inmates in 2000, a 6-percent

increase. They also reported that they were operating at 118 percent capacity. Yes, in your written testimony it is indicated that

there is no funding for facilities.

Ms. HENKE. Sir, the Tribal Prison Construction Program, I believe, is what is being referenced. The Department has not requested funding for fiscal year 2003 for this program. The reason

is that the Department and the Administration believe that the

program has been a success. Currently, according to the most recent statistics that we have, our tribal prison entities are currently

operating at about 86 percent capacity.

In addition to that, by July 2003, according to our estimates, another 1,000 beds will be made available. On top of that, for the current fiscal year, fiscal year 2002, the Department has $35 million

that we will also be distributing which will further increase the capacity.

The CHAIRMAN. So, you believe that it is adequate?

Ms. HENKE. According to the statistics that we have, yes.

The CHAIRMAN. The numbers that we received indicated that

they were 118 percent. Something is wrong here.

Ms. HENKE. One of the things that we are working on, sir, is improving the statistics that we are able to gather from Indian country. So, we will continue to do that.

The CHAIRMAN. A few years ago the Department of Justice and

the Department of the Interior estimated that 4,300 sworn law enforcement officers were needed in Indian country. At that time

there were only 1,600. Yet we still have less than 2,500 serving Indian country. Why aren’t we doing much more in trying to get law

enforcement officers when we know that the crime rate is high?

Ms. HENKE. Sir, the Department is working on that overall. As

you know, our primary focus, of course, is law enforcement. That

is one of the things that working with the CIRCLE project and others that we are trying to improve law enforcement services and the

number of law enforcement officers in Indian country. Not only is

money made available through the COPS program, but tribes are

also eligible through the current Byrne Formula Program and discretionary program as well as the local law enforcement program.

The CHAIRMAN. According to the BIA, there are 35 tribes with jurisdiction over lands adjacent to the Canadian or Mexican borders

and jurisdiction over waters directly accessible by boat from Canada or Mexico. These lands comprise 260 miles of the total of 7,400

miles of international borders. Does the Department propose to include Indian tribes in any of the border security initiatives?

Ms. HENKE. Sir, the jurisdiction for that falls under another component within the Justice Department. I am happy to get back to

you with an answer for the record.

The CHAIRMAN. I would appreciate that.

Ms. HENKE. I can assure you that the Department, though, is

committed to our border and to protecting the border.
28

The CHAIRMAN. I would appreciate this.

Ms. HENKE. Certainly, sir.

The CHAIRMAN. The Indian Tribal Justice Act was enacted in

1993 and authorizes base support funding for tribal justice systems, yet there is no funding requested for programs authorized in

this act. Is there any reason for that?

Ms. HENKE. Sir, the program funding levels that we have asked

for for fiscal year 2003 are consistent with those that were funded

and supported in fiscal year 2002. We have a number of tribal

courts and judicial assistance programs within the Office of Justice

Programs, but I am happy to talk to you further about that specific

program.

There are, we believe, a number of programs that currently exist,

have been funded in the past and that the President proposed for

funding in fiscal year 2003 that will assist in those efforts.

The CHAIRMAN. This is one of the sad and tragic areas of life. A

few years ago I visited one of the little villages in northern Alaska

to look over a brand new prison facility. It was brand new and they

showed me the room where the intoxicated would cool off. They

were piled body to body. Every square foot was filled. They were

just dumped in there like animals. As a result, we had a beautiful

building with almost no personnel. Is that the situation in Indian

country?

Ms. HENKE. Sir, we know that there are serious problems in Indian country, especially as it relates to alcohol and substance

abuse. We are working and using our CIRCLE tribes, the Oglala

Sioux, the Northern Cheyenne, and the Pueblo of Zuni, as a pilot

program to assist the Department in identifying strategic ways to

address the problems in Indian country, but in partnership with

the tribes themselves, not by a mandate from Washington.

We believe that the CIRCLE project will result in success and

will not only help the Department, but will also have the tribes

participating sharing their information with the rest of the tribes

in the country. That will help us address the issues that exist pertaining to overcrowding in jails, specific to areas related to substance abuse, alcohol abuse, et cetera.

I have also had the fortune, sir, of visiting a number of small

areas in the State of Alaska, as well as in the State of Hawaii and

will soon be visiting, as I informed Senator Campbell earlier, the

Northern Cheyenne.

I believe it is important for us to see first hand what exists and

to talk to the tribes themselves to figure out how we can work together to address the issues.

The CHAIRMAN. I commend you on your CIRCLE program. It has

great potential.

Ms. HENKE. Thank you.

The CHAIRMAN. I just hope it works all over Indian country because you have the right solution. Oftentimes the best solutions

come from Indian country. As you pointed out, it is not dictated

from Washington.

Ms. HENKE. Yes, sir.

The CHAIRMAN. With that I thank you very much.

Mr. Vice Chairman.
29

Senator CAMPBELL. Thank you, Mr. Chairman. Tracy, I also commend you on the CIRCLE program. I am very familiar with the one

in Northern Cheyenne because I am up there a lot. That is where

my ancestral home is. I think it is doing a good job.

You have been in your job about 2 or 3 months now?

Ms. HENKE. Actually, sir, almost 7 months.

Senator CAMPBELL. Almost 7 months? Time flies, right?

Ms. HENKE. It does fly, sir.

Senator CAMPBELL. Well, I commend you for going out there and

trying to get first-hand information from the tribes because very

often you might be aware that they come in here and say:

Nobody asked us. These are implemented by the administration. They are passing

things and nobody asked us.

Senator Inouye and I have always tried to make sure that they

are well informed and they are a party to it, there is some negotiated rule-making going on and so on. But you probably also recognize, at least on my part, a little bit of frustration because Senator

Inouye and I have been here a long time.

Year after year we face the same problems. In fact, I was teasing

my staff a little while ago that there must be something in my coffee when I come in here because I am always in a fight it seems

like and I don’t mean to be. But we owe so much and we are paying so little on what we owe to Indian tribes and what we promised.

I just want to ask you a couple of questions. Senator Inouye already dealt with the border issues for one. I am on the Treasury

Appropriations Subcommittee. I was the chairman for a number of

years. Now I am ranking on that. We have provided a great deal

of money through law enforcement, as you know, to work with

tribes that run from the northern border of North Dakota, to the

O’odham in Arizona. How do we encourage more Federal-tribal cooperation because I know some of those tribal areas are just like

sieves? There is a fence with a bunch of holes cut in it, basically.

Ms. HENKE. Sir, like you, I am a firm believer and luckily I work

for both the Attorney General and the President who are firm believers in seeing the situation first-hand, in talking to the people

on the ground.

I am from a very small town in the State of Missouri, and I know

often the perception of the people back home and if nothing else

from my parents. What is the Federal Government doing now? So,

it is important for us to go see first-hand. It is important for us

to have programs like CIRCLE that encourage cooperation.

It is important for us to work not just within the Department of

Justice and across components within the Department of Justice,

but for us to work across the Federal Government with the other

Federal agencies to address issues comprehensively to ensure that

the taxpayer resources are being utilized to meet the needs and not

used to overlap or duplicate or at cross purposes.

Those are all things that specifically the Office of Justice Programs, are working on at the direction of the Attorney General.

As relates to the border, that is something that once again

through funding provided through the Office of Justice Programs to

the tribes through a variety of different mechanisms that we have,

plus working with those entities within the department who are re-
30

sponsible for security along the border, that cooperation will exist

and we will continue to improve upon it.

Senator CAMPBELL. Well, I admire you enough to tell you that

you may have already found out, particularly on our southern border, those reservations that border Mexico, it is really complicated

because there are relatives living on both sides of the line, on both

sides of the fence, I mean cousins, brothers and sisters and so on.

It really complicates our problem of trying to have secure borders

at the same time when we know that there are people that are related living on both sides.

Maybe just one last thing. That deals with substance abuse. I

really appreciate your emphasis on that. It is a huge problem and

I don’t mean sophisticated drugs like cocaine and so on. I mean

stuff like canned heat, huffing paint in paper bags. That is what

we deal with much more on reservations when we talk about substance abuse. It is real, degrading, terrible stuff that just burns

your brain out. The kids sniffing glue, that kind of thing is what

we deal with on reservations.

I introduced S. 210 which authorized the tribes to integrate programs for many agencies. Would you review that legislation? One

of the problems we have now, I think, is that the Department of

Justice and the Bureau of Indian Affairs, the Indian Health Service, they all have a vested interest in this kind of thing. They are

all interested.

But I think on many occasions they are duplicating or they are

going by each other a little bit. Basically, what S. 210 does is it

tries to integrate some of those programs. Would you look at that

and give the committee your views on it?

Ms. HENKE. Sir, we certainly will.

Senator CAMPBELL. I thank you.

Thank you, Mr. Chairman. I have no further questions.

Ms. HENKE. Thank you.

The CHAIRMAN. Our mission seems impossible.

Ms. HENKE. I hope not, Mr. Chairman.

The CHAIRMAN. Our funds are never adequate. The problems are

depressing, but we would like to work with you to resolve these

matters. It may take eons, but we will do it.

Ms. HENKE. Sir, we hope it doesn’t take eons, but we look forward to working with you.

The CHAIRMAN. Thank you very much.

Ms. HENKE. Thank you.

[Prepared statement of Ms. Henke appears in appendix.]

The CHAIRMAN. With that, the hearing is adjourned.

[Whereupon, at 11:52 a.m., the committee was adjourned, to reconvene at the call of the Chair.]
(31)

APPENDIX

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

PREPARED STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM

COLORADO, VICE CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

Good morning, and thank you Mr. Chairman for holding this important hearing.

In future hearings we will hear from the Indian Health Service [IHS] and the Bureau of Indian Affairs [BIA] on the request as it affects them.

Today will we hear from other agencies that provide key services to tribes and

Indians on a variety of important fronts such as:

—Law enforcement and policing;

—education;

—drug treatment, elder care; and

—the Administration for Native Americans.

Safe and stable communities provide safety to their members and attract business

activity which is so important to Native communities nationwide.

Given the incredible demands placed on the Department of Justice to fight terrorism I am generally encouraged by the request for Indian law enforcement with a

few exceptions:

—The lack of tribal detention center funds;

—the reduction in ‘‘COPS’’ funds for tribes; and

—the static funding for tribal courts.

Nevertheless, I am hopeful we will find the kind of resources we need for these

important services.

I commend the President for his dramatic proposal to increase funds for substance

abuse and mental health treatment. We all know that these problems continue to

ravage Indian communities and I am glad to see the increase.

I will have several questions for our witnesses, Mr. Chairman, but I do want to

take the opportunity to convey what I believe is one of the most successful Federal

programs ever devised: the ‘‘Administration for Native Americans’’ or ‘‘ANA’’ as we

know it.

The ANA provides seed capital for Indian businesses, language preservation, and

environmental protection . . . and does it in a way that reduces dependence. I urge

the Department to study the ANA and find out why it works and replicate its success.

Mr. Chairman, there are many other things I’d like to mention but I will reserve

my time for the question and answer period.

With that, I ask unanimous consent that my formal statement be included in the

record.

Thank you Mr. Chairman.
32

PREPARED STATEMENT OF HON. TIM JOHNSON, U.S. SENATOR FROM SOUTH DAKOTA

Chairman Inouye, Vice Chairman Campbell, members of the committee, I am

pleased that the Senate Committee on Indian Affairs is holding a series of hearings

on the President’s Fiscal Year 2003 Budget on Indian Programs. All Federal agencies have a tie in some way to Native people, tribes, and villages. In this current

national climate, I was pleased that Indian programs have not received too much

of a decrease. However, I am concerned over the lack of prioritization this Administration is focusing on several programs.

My main concerns are decreases for tribal colleges, and Indian health service facility construction. Both of these programs are vitally needed on South Dakota’s

nine Indian reservations.

South Dakota is home to four tribal colleges, with one nearby in North Dakota

serving South Dakota Native Americans. These colleges are Since Gleska, Si Tanka/

Huron, Oglala Lakota, Sitting Bull, and Sisseton-Wahpeton Community College. All

of these colleges have contributed to the overall health and welfare of the tribal college system. For numerous years, I have advocated increases of the meager funding

they receive to provide for the education of our First Americans.

This is not a luxury, this is a treaty responsibility. The Federal Government is

obligated to provide educational opportunities for tribal members. Last year, I, along

with a number of my colleagues, was successful at obtaining $41 million for core

operating funding for the colleges. These schools do not posses large endowments

or a significant donor base they can pull from. The over thirty colleges are forced

to share just over $41 million for operations. I am hopeful that Congress will at

least be able to restore the Colleges back to the appropriated level from fiscal year

2002.

Additionally, the budget decreases also effect construction for our nation’s Indian

health service facilities. Health care is basic necessity for all Americans. In Indian

country not only do we see a lack of physicians and nurses, but we find several outdated and overcrowded facilities. Many of these do not even meet safety code standards. At the Cheyenne River Indian Reservation, the health care facility cannot

even support baby delivery. Mothers have to travel approximately 100 miles south

to Pierre, SD to deliver their babies. This presents major health and safety concerns

when there, unfortunately, are complications.

At the Sisseton-Whapeton Indian Reservation, health care personnel are working

in trailers that should have been torn down due to safety concerns. These are dilapidated trailers housed in the back of the facility which itself is over crowded with

both patients and documents.

There is no in-patient care at either of these facilities. We can and need to do

better. It must no longer be the norm to treat our First Americans as third class

citizens. I look forward to working with this committee, the Budget Committee and

the Appropriations Committee to try to increase these inadequate funding levels. I

thank the Senate Committee on Indian Affairs for holding this series of budget oversight hearings and I look forward to hearing the testimony today.

PREPARED STATEMENT OF HON. BYRON L. DORGAN, U.S. SENATOR FROM NORTH

DAKOTA

Mr. Chairman, I want to thank you for convening this hearing on the President’s

fiscal year 2003 budget request for certain Indian programs and services.

The need for more funding for Indian health, education, housing, justice and other

programs is well documented. Just this past Sunday, there was an article in the

Salt Lake Tribune about a little boy named Tyler who has cereal palsy today because of inadequate care he received at an Indian Health Service hospital. Another

baby boy was sent home from an IHS hospital emergency room after the nurse

misdiagnosed him with chicken pox. Two days later he was dead. Now, I understand

that the IHS is making due with inadequate funding and that is my point. The IHS

currently has a health services budget of $3 billion, and needs about $12 billion

more. That underfunding has life and death consequences for Native Americans

every day. Unfortunately, the President’s budget request for the IHS recommends

only a $68-million, or 2.2 percent, increase for fiscal year 2003. Likewise, the budget

for the Bureau of Indian Affairs receives only a 1-percent increase, despite the needs

that exist with respect to housing, education, law enforcement, social services, and

other areas.

Regrettably, the President’s budget comes nowhere close to meeting the need for

funding that exists in Indian country, and the fiscal situation will make it very difficult for the Congress to make room for additional spending. I want to explain the
33

difficult dilemma the President’s budget creates for Indian programs, as well as for

other domestic programs that Native Americans and other Americans depend upon.

Quite frankly, the President’s budget request simply does not add up. The President’s budget talks about surpluses, but there are no budget surpluses without Social Security and Medicare funds. The President is proposing to use $2.2 trillion in

Social Security and Medicare trust funds to pay for tax cuts and defense and domestic programs.

Even using this much of the Social Security and Medicare trust funds, the budget

outlook is bleak for programs other than defense and homeland security. The President’s budget requests an increase of 6.8 percent in discretionary programs—programs for which funding is allocated annually through the appropriations process.

Factor in inflation and the increase is only 3.7 percent. Then consider that the

President proposes substantial increases of 10 percent for defense and 23 percent

for homeland security, and I fully expect the Congress to support these increases.

The result is that the real purchasing power for other domestic programs—including

health care, education, the environment, and Indian services—is actually cut by an

average of 6.2 percent.

I explain this not because I want to provide excuses for Congress but to challenge

all of us to strive to do better when it comes to Indian programs that the Federal

Government has a trust responsibility to provide.

The cuts in the President’s budget are not just theoretical ones—they come at the

expense of programs that are vitally important and needed. For instance, within the

Department of Justice budget, the $35 million in funding for construction of detention facilities is eliminated, and funding for the Community Oriented Policing Services [COPS] program is cut by $5 million. The other DOJ tribal justice programs

are level funded, meaning that in real terms, the purchasing power of those programs will be eroded. Are these cuts because the need for these programs has been

reduced? Absolutely not. While the violent crime rate nationally has been declining,

Native Americans are still more than twice as likely to be the victims of violence

than the general population. More than half of jails in Indian country are operating

above capacity, and nearly a quarter are operating above 150 percent capacity. To

me, it just doesn’t make sense to suggest cuts for detention facilities and law enforcement officers when they are so clearly necessary.

I will give more examples at later budget hearings of cuts in the areas of education, housing and health care that are not warranted and will cause hardship for

Native Americans. I hope the Congress can and will do better in meeting our obligations to Indian people than the President’s budget does.
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Æ
(234)

FISCAL YEAR 2003 BUDGET

THURSDAY, MARCH 7, 2002

U.S. SENATE, COMMITTEE ON INDIAN AFFAIRS, Washington, DC.

The committee met, pursuant to notice, at 10:02 a.m. in room

485, Senate Russell Building, Hon. Daniel K. Inouye (chairman of

the committee) presiding.

Present: Senators Inouye, Campbell, and Domenici.

STATEMENT OF HON. DANIEL K. INOUYE, U.S. SENATOR FROM

HAWAII, CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

The CHAIRMAN. The committee meets this morning to receive testimony on the President’s budget request for fiscal year 2003 for

Indian programs administered by the Indian Health Service and

the Department of Housing and Urban Development.

The Bureau of Indian Affairs [BIA] reports that as of 1999, 43

percent of all adults living on or near Indian reservations were unemployed, and 33 percent of those who are employed were still living in poverty.

The Indian Health Service [IHS] data indicates that compared to

the general U.S. population, American Indians and Alaskan Natives have a mortality rate that is six times higher for alcoholism;

four times higher for tuberculosis; three times higher for diabetes,

and twice as high for unintentional injuries.

Most Indian Health Service hospitals are more than 32 years old,

and in the area of housing, recent studies indicate that the highest

rate of overcrowding and inadequate housing in the United States

can be found in Indian country.

These are just some of the statistics that we must keep in mind

as we examine the President’s budget for Indian programs, and as

we call upon Federal agencies to help us understand whether we

will be able to adequately address the overwhelming needs in Indian country with the funding that is proposed for fiscal year 2003.

In exchange for the cession of more than 500 million acres of

land by the Indian nations, the United States has assumed a trust

responsibility for Indian lands and resources, as well for the provision of health care, education, and housing.

These legal responsibilities have their origins in treaties and the

United States’ course of dealings with tribal governments and their

citizens. So we must examine the initiatives outlined in the President’s budget with these legal responsibilities in mind.
235

Today, we will ask the agencies to advise us whether we are falling further behind in carrying out our responsibilities, and inquire

what resources are needed to fulfill our commitments as a Nation

to the sovereign governments of Indian country and the people they

serve.

With that, may I call upon my vice chairman.

STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM COLORADO, VICE CHAIRMAN, COMMITTEE ON

INDIAN AFFAIRS

Senator CAMPBELL. Thank you, Mr. Chairman.

Twenty-six years after the Indian Health Care Improvement Act

was enacted, the health of Indian people is still the worst in the

Nation in many respects. Diabetes, amputations, tuberculosis,

heart disease, substance abuse, and so on are many times the national average, and you have mentioned the figures.

I can tell you that this is not an abstract number for most Indian

people, because every Native American person I know has someone

in his family who suffers one of those things that we have spoken

about.

Just last month, Secretary Thompson released a study by the

CDC’s National Center for Health Statistics, showing that in the

categories such as breast cancer, stroke, lung cancer and suicide,

Native Americans are also doing worse than most other Americans.

Mr. Chairman, when we had our last hearing, I did reference a

recent article that was in the ‘‘Wall Street Journal,’’ which referred

to the funeral home business as the most successful business on

the Oglala Sioux Reservation in Pine Ridge, SD.

I think that is really an unacceptable commentary, when in a

community where over 90 percent of the inhabitants are Indian

people, that the most active enterprise is burying Indians. We have

got to do a lot better than that.

With your permission, I would like to introduce that article in

the record.

The CHAIRMAN. Without objection.

[Referenced document appears in appendix.]

Senator CAMPBELL. I do commend the President for his request

of some $2.514 billion, which is about a 2.6-percent increase over

enacted levels, and a $72-million increase for health facilities; although it will still fall short of providing the Indian health care

funds needed to bring Native American people in parity with non–

Indians in the health sector.

I am particularly interested in working to improve key areas of

Indian health that I believe are disproportionately responsible, that

bring misery and ruin to many Native American families: Diabetes

prevention and care, alcohol and drug abuse, and mental health

problems, as well as substance abuse.

As the urban Indian population steadily but surely increases, we

must do more to refocus attention on the needs of urban Indian

people, too. For Indian housing and community development, the

request includes some $650 million for NAHASDA block grants,

and additional funds for the CDBG grants, as well.

I look forward to hearing the testimony of our witnesses today,

Mr. Chairman; thank you.
236

The CHAIRMAN. I thank you very much.

Our first witness is the director of the Indian Health Service, Department of Health and Human Services, Dr. Michael Trujillo.

The Doctor will be accompanied by Michel Lincoln, deputy director, Indian Health; and Gary Hartz, acting director, Office of Public

Health.

Dr. Trujillo, it is always good to see you, sir.

STATEMENT OF MICHAEL TRUJILLO, DIRECTOR, INDIAN

HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN

SERVICES, ACCOMPANIED BY MICHEL LINCOLN, DEPUTY DIRECTOR, INDIAN HEALTH SERVICE AND GARY HARTZ, ACTING DIRECTOR, OFFICE OF PUBLIC HEALTH

Dr. TRUJILLO. Good morning, Senator, it is good to see you, too.

I am very honored to be before you and Senator Campbell this

morning in regards to the Indian Health Service budget and programs. To my right is Mike Lincoln, and to my left, Gary Hartz.

We are honored to come here this morning and discuss with you

the President’s fiscal year 2003 budget for the Indian Health Service.

For the 5th year now, the development of the health and budget

priorities supporting the agency’s request originated at the service

delivery level, and with tribal leadership and urban program involvement. We participate in formulating the budget request and

the annual performance plan of the agency.

Further, I would like to add that the department held two tribal

budget consultation sessions in June. One was hosted by the deputy secretary, and covered all HHS agencies. The other focused

solely on the needs and programs of Indian health care systems.

Both these sessions were detailed and were very productive, and a

very constructive dialog with tribal leadership.

These budget consultation sessions are only one effort of many

that Secretary Thompson has made to consult with tribal leadership. He and Deputy Secretary Claude Allen have already visited

Indian country, and have also planned additional visits.

Secretary Thompson has spoken of his commitment to the Indian

Health Service, and his support of our services and resources. He

is committed to consultation and collaboration, and to continue to

have American Indians and Alaska Native leadership involved in

policy and have their input.

I believe the Secretary’s efforts of increasing the amount of collaboration across all agencies within the department, as well as the

incentives and initiatives for the department will benefit all American Indians and Alaska Native health care and social service programs.

All programs within the department will have an increasing role

to assist American Indians and Alaska Natives in their programs,

in their resources, and also program infrastructure development.

As I enter my 8th year as director of the Indian Health Service,

I have had the honor to work closely in a collaborative and open

manner with tribal leadership and urban program directors from

across the Nation. Together, we have overcome difficulties and impediments, and I truly believe we have made significant strides to
237

improve the agency’s effectiveness, efficiency, and responsiveness to

those we all serve.

Those very important improvements and positive changes, unfortunately, get lost in the negative events, sometimes the negative

data, and the inaccurate stories that are sometimes portrayed.

At this time, I do wish to thank tribal leadership and the urban

program directors for their commitment, their dedication, and certainly their sincere professionalism and guidance. I believe together, Congress, the Administration, the Department, and tribes,

will continue to make positive strides in health care for all American Indians and Alaska Natives.

I also wish to thank this committee and staff for keeping in mind

the long-term goals to improve American Indians and Alaska Native health care, and to strengthening the special government-togovernment relationship.

Tragically, on September 11, many things changed. The history

of our country is being written on how the country has responded

to the terrorist attacks, and the responses of many of us, directly

or indirectly. Lives and priorities were changed. Now we must all

play our part in those changed priorities of the Administration, of

Congress, and of the Nation.

We must assess our respective roles and responsibilities in light

of the aftermath of September 11, and in the wider national priorities. In this it is our respective roles to improve health care services for American Indians and Alaska Natives across the country,

and address the growing needs together.

I want to thank you sincerely and personally for all that you

have done and what the committee has done to improve that health

care. Now I will discuss questions you may have regarding the

President’s budget of an overall increase of $6.1 million, a 2-percent increase.

The budget not only reflects needs increases for American Indians and Alaska Native health care, but also the Administration’s

and the Nation’s emphasis on national security, the war on terrorism, and the management efficiency and effectiveness and accountability initiatives of the President.

Thank you. We have submitted a written statement for the

record.

[Prepared statement of Dr. Trujillo appears in appendix.]

The CHAIRMAN. I thank you very much, Dr. Trujillo. As you

know, Doctor, there are three major Federal agencies that provide

health care services. The largest is the Department of Defense, and

then the Department of Veteran’s Affairs, and the Indian Health

Service. Doctors graduate from the same medical schools. They provide the same medical care.

How does your doctor compare with the doctor at Walter Reed?

Dr. TRUJILLO. In regards to the physicians that enter the Federal

service, and more specifically the Indian Health Service, we have

graduates from all universities, medical schools, and academic

medical centers, from all categories from the United States.

Physicians enter the Indian Health Service in two primary employment systems. One is a civil service clinician, or through the

USPHS Commissioned Corps, such as myself.
238

In both of those, in order to enter as a clinician to practice and

provide clinical care, one has to go through the initial appointment

process of review on the civil service employment system, or the

Commissioned Corps.

Secondarily, one has to also verify and have documentation for

undergraduate and graduate work in medical education; must all

have references and documentation from the appropriate

residencies or internship that that individual has completed; and

also have a full and unrestricted license from a State, if one is in

the Commissioned Corps.

If one is in the civil service, the individual has to have a license

from the State that he she has duty in or has been assigned to for

clinical care.

All our hospitals and clinics, including tribal programs, also have

to meet the JCHO, or the Ambulatory Care Accreditation Committee’s program for verification, medical staff bylaws, privileging, and

re-credentialling by the medical staff.

Approximately 3 or 4 years ago, the Office of Inspector General

also did a review of the agency’s credentialling and medical staff

bylaws and privileging. At that time, the review found that the

policies and procedures were appropriate.

There were some concerns in regards to some oversight and to

strengthen our interaction with tribal programs, so that we all had

and were working from the same database to verify individual past

histories of individual clinicians.

That has been incorporated and, in fact, just in recent discussions with the Office of Inspector General, we are also enlarging

the other new databases that have also become available this recent year.

The CHAIRMAN. What is the pay differential?

Dr. TRUJILLO. The pay differential varies in localities. If one enters the Commissioned Corps, there is a specific pay scale.

The CHAIRMAN. Well, let us just put it this way. A person of

equal education, both of them thoracic surgeons, what is the difference in pay?

Dr. TRUJILLO. I wish we had a thoracic surgeon in the service.

Unfortunately, we do not. But let us say in orthopedics.

The CHAIRMAN. An orthopedic surgeon.

Dr. TRUJILLO. We do have those individuals. They can come in,

in two ways: one, as a Commissioned Corps Officer, at the level of

their full training, in which they have completed their residency

and surgery residency, and placed in a hospital setting.

The CHAIRMAN. What is the pay?

Dr. TRUJILLO. They would be paid a Commissioned Corps salary

and special pays, because of their specialty and locality. Because of

that, they can most likely attain a salary of around $140,000/

$120,000, plus special pays in their category in the Commissioned

Corps.

The CHAIRMAN. That is the highest you can get?

Dr. TRUJILLO. In the civil service system, we also have availability of some additional special pay categories, such as Title 38,

which is also available for the VA program.

The CHAIRMAN. What I want to get, Doctor, is who gets better

pay: VA, Defense, or Indian Health Service?
239

Dr. TRUJILLO. In the initial phase of an individual coming into

the program, with the special pays that are available to the civil

service employee, a civil service new clinician, in a specialty area

such as orthopedic surgeon, would receive the higher pay; versus

the Commissioned Corps physician, with the same training, the

same level, and the same location.

We have to, however, compete with the private sector, in many

metropolitan areas, where an orthopedic surgeon may be located.

In that case, an individual coming out of training, residency, and

then going into the private sector, may earn two to three times or

four times more than in the IHS. This may also include bonuses

to sign on for that particular health care organization.

The CHAIRMAN. I just want a simple answer. On the whole, who

gets better pay: Indian Health Service, VA Hospital, or Defense?

Dr. TRUJILLO. The Department of Defense and the Indian Health

Service Commissioned Corps officers receive the same respective

pay. The VA has availability of the title 38 in their specialty care,

as well as the Indian Health Service.

However, I would have to look at this a little bit more closely.

I would think the VA program may have more options for increased

pay and benefits for the individual. We can also send you some

written information regarding the pay scales on respective agencies

and programs.

The CHAIRMAN. Dr. Trujillo, you are well aware that the elderly

population in Indian country is growing in size, and nursing homes

are required to be licensed if they are to be eligible for reimbursement from Medicare and Medicaid programs. Tribal governments

have repeatedly expressed frustration in securing adequate longterm care in their communities.

Does the Indian Health Service currently provide health care to

elderly Indians and Alaska Natives?

Dr. TRUJILLO. Senator, yes, we do provide medical care and services, and contract health service to individuals who are eligible for

services. Because we do not have funding nor authority to manage

and administer skilled nursing home care facilities, we have to rely

on outside sources. Tribes also have to rely on that availability.

However, some tribes have built their own skilled nursing home

care centers.

The emphasis of the agency, as well as with tribes, has been,

how do you keep an elderly individual at home? So a lot of our concentration is on the aspects of out-patient, out-sourcing in regards

to making sure that they have availability of resources, and the

availability of support services, such as meals, so that the individual can be at home.

The CHAIRMAN. Would it be feasible for your health service to

maintain nursing home care facilities?

Dr. TRUJILLO. We have discussed this at various periods of time

within the agency and also with the involvement of tribes. The difficulty of instituting skilled nursing home care services, is that it

is terribly expensive and labor intensive.

The CHAIRMAN. How much?

Dr. TRUJILLO. It is much more expensive than we would be able

to run, let us say, in a locality such as Pine Ridge. Such a facility

would require staffing and equipment that is quite enormous as
240

well as the large amount of resources that are needed for skilled

nursing home care.

The CHAIRMAN. Can you share those numbers with us?

Dr. TRUJILLO. We will be able to share those. We also have to

work with State licensure and accreditation procedures and building capabilities for such nursing home care.

One of the efforts of the department is looking at elderly care.

In fact, in about 2 weeks, I have a meeting with the Director of the

Office of Aging, so we can discuss some of the specifics of how we

can better coordinate the department’s effort on elderly health care

programs.

The CHAIRMAN. Can you provide for the record the size of the

population you serve, and the number of physicians and staffers

serving them, as compared to the population that is served by the

Department of Denfense and their doctors and staffs; and the same

thing with VA?

Dr. TRUJILLO. Yes; we will.

The CHAIRMAN. I have a few more questions; but Mr. Vice Chairman, please proceed.

Senator CAMPBELL. Thank you, Mr. Chairman, and let me ask a

few, too, and then I will pass to Senator Domenici.

First, Dr. Trujillo, you know, I understand you have really made

a commitment to recruitment and retention for Indian people in

the medical profession, and I certainly appreciate that.

Can you tell the committee how many Indian doctors there are

in the IHS, and perhaps how many Indian medical students there

are in training?

Dr. TRUJILLO. I do not know exactly how many Indian medical

students are in training at the present time. I know there has been

a tremendous increase in the number of Indian physicians over the

past several years.

Senator CAMPBELL. Well, give me a ball park figure. Does ‘‘tremendous increase’’ mean 2 or 10 or 100, or what?

Dr. TRUJILLO. The figure I am more familiar with regarding Indian students and medical school approaches around about 200.

Senator CAMPBELL. Could you try to find out that number; not

only of the doctors, but of the ones in training?

Dr. TRUJILLO. Yes.

Senator CAMPBELL. I think the committee would be interested in

knowing that.

Dr. TRUJILLO. It changes up and down, but we have seen a trend

across the Nation.

Senator CAMPBELL. I thank you.

Let me ask you a couple of medical questions about dialysis machines. How many people can use a machine in a day? I do not

know a single thing about them, other than they are mighty expensive and mighty necessary.

Dr. TRUJILLO. The dialysis machines that corporations and

health facilities now maintain have a little faster rate of dialysis

than in the past. However, an individual still must be on the machine at least 2 to 4 hours, depending upon the blood chemistries

that they have and the intensity of care. Most individuals are on,

I would say, an average of 3 to 4 hours.
241

Senator CAMPBELL. If you ran that day and night, you would get

maybe six people.

Dr. TRUJILLO. Yes; on one machine.

Senator CAMPBELL. On one machine?

Dr. TRUJILLO. And that individual also has to be dialyzed, on the

average, three times a week.

Senator CAMPBELL. Yes, I knew that; thank you.

A couple of years ago, the Northern Cheyenne built a new clinic.

Dr. TRUJILLO. Right.

Senator CAMPBELL. It was opened, I think, about 1 year or 11⁄2

years ago. In fact, I went up and visited it. It was a very, very nice

facility.

At that time, I asked you if they could get a dialysis machine up

there, and you will remember me asking that.

The problem was, the machine stayed awhile, and then it was

moved out, from what I understand, from the tribe, due to lack of

operational funds. I tried to track that down a little bit, and found

out they had the machine, but they did not have anybody that

could run it, and so they moved the machine.

Well, there are people up there, and I mean dozens, not one or

two, but dozens have to make a 180-mile round trip, three times

a week in the wintertime over black ice, and even in the summertime through often congested traffic, to get dialysis in Billings.

It takes 8 or 10 hours to do that for them, or more. So staying

alive has become a full-time job for the people that have to go all

the way to Billings and back, three times a week.

It just seems to me that it would have been a lot easier and

maybe a lot less expensive to train somebody to run that machine,

when you think in terms of manpower to drive people over there,

the cost of gasoline and renting a van three times a week, or probably every day. The people have to go three times a week, so they

probably do it every day.

Why do we not put that machine back? In fact, that is what I

want you to do. Get that machine back up there, and get somebody

up here to train on it.

The community colleges came in to see me, and I am sure they

visited with other members on the committee, too, not long ago.

Some of them feel that they could do some of the training for the

people to operate the machines.

So first, can I get your commitment to get that machine back up

there, and get somebody to operate it? Second, would you give me

your opinion on having community colleges train some of the dialysis operators?

Dr. TRUJILLO. In regards to dialysis, the Indian Health Service

does not maintain any dialysis programs. The tribes, or Indian

Health Service, contracts with a dialysis program. In this particular case, I believe the dialysis program for Lame Deer was contracted from Deaconess Hospital out of Billings.

The difficulty we had in regards to maintain dialysis, in this particular case, was having to have a nephrologist, having to have the

certification for the program to maintain and run and administer

the dialysis program, and also having to have trained nursing care

and dialysis technicians, including the maintenance of the dialysis

machines at that location.
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Senator CAMPBELL. Let me see if I understand this then. IHS

provides the machines, but you do not even provide the machines?

Dr. TRUJILLO. We do not provide the machines. In fact, the corporations that tribes and Indian Health Service contract with provide all that, including the certification, the nephrologists, the technicians, the nursing care, and all the operational programs for the

dialysis center.

Perhaps, some tribal colleges may be able to train individuals as

dialysis technicians; but the complexity and the technology is usually very specialized training program, after having some basic

training at a medical center or in a dialysis program.

One must have a certified nephrologist, who is trained in dialysis, to be the administrator and medical director, and must be able

to have certification as a dialysis program; and, in that case, receive reimbursement from Medicare.

Senator CAMPBELL. This is getting too complicated for me. Give

me a simple answer, if you can. What can you do to get a machine

back up here, and to get somebody trained to operate it up here?

Dr. TRUJILLO. We have been working with the Billings area office

and Lame Deer, and well as with Crow, because Crow does have

machines, and some patients from Lame Deer do go down to Crow,

which is approximately halfway in between Billings and Lame

Deer.

We will commit to work with you and get you some respective

answers of our plans, and also the followup and some options of

how we might be able to provide services there. I would provide

that to you within the next 2 weeks.

Senator CAMPBELL. Would you do that?

Dr. TRUJILLO. Yes.

Senator CAMPBELL. Okay, thank you, I appreciate that.

Maybe I have one other question, and then I will come back for

another round, Mr. Chairman. That question concerns something

that I think was really distressing. Perhaps you are not aware, or

maybe you are, Doctor, but I would like your view on this.

In December 2001, an incident occurred on the Cheyenne River

Sioux Tribe, where an IHS doctor by the name of Reid apparently,

because there are several stories, including the ambulance driver,

but the doctor told the ambulance driver to deliver the body of a

deceased Lakota man by the name of Leonard Fiddler, to the IHS

Hospital.

It is reported that Dr. Reid told the ambulance driver:

Whatever you do, do not bring the body to the IHS. I do not care if you take it

back or throw it on the side of the road; just do not bring it here.

Are you familiar with that at all?

Dr. TRUJILLO. Yes, I am, Senator, unfortunately.

Senator CAMPBELL. Could you tell the committee what you did

about that, or what policies you have in place; or if it is true, if

Dr. Reid is still working there?

Dr. TRUJILLO. First of all, the incident occurred with Mr. Fiddler,

who also was an elder tribal leader in the Cheyenne River Tribe.

Senator CAMPBELL. I know his family well, by the way.

Dr. TRUJILLO. Yes; and he went to bed early in the evening. He

was a diabetic. His wife was unable to wake him up several hours
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later. Because of the circumstances, the wife called the police and

an ambulance service was requested from the locality.

The ambulance arrived. The technicians detected no life signs,

including pulse or responsiveness or eye reflexes, and then called

the Indian Health Service local facility at Eagle Butte Hospital.

The nurses responded and called the on-call physician, who was

a contract temporary physician, not an Indian Health Service physician, who was contracted to work in the evenings and on weekends.

Because of policy that was developed locally, in which deceased

individuals were to be transported to the local mortuary or the

morgue that the family designated, the clinicians said that that

was supposed to be the route of the deceased individual on the ambulance.

There was confusion as to why not just take the individual to the

hospital, because the family had not made up their mind as to

where to go. Because of the location of Eagle Butte, and having encountered the death very quickly and unexpectedly, they did not

have that in place.

Unfortunately, and this is very tragic, my understanding of the

situation was, the clinician made some very uncalled for remarks.

Senator CAMPBELL. Where is he now?

Dr. TRUJILLO. The physician was terminated, and we no longer

have that individual on contract any place within Indian Health

Service. We also contacted the organization that we work with to

hire the temporary physicians in, and told them the circumstances,

and the necessity not to have clinicians in our service such as this.

When I found out about this, I also called on two of our clinical

clinicians, who have expertise in emergency care, and one was a

former medical examiner, and they had national experience. They

did an immediate review of the situation.

I also called the Office of Inspector General, so that we could

have an independent review. They did an independent review of

the situation and forwarded me the results.

Just recently, I also met with Chairman Greg Borland and his

health care committee. We went through the circumstances of the

death policies, and how we will be working together, to not only

overcome this particular situation, but also look at some of the

other concerns that we both have regarding the delivery of services

and the possibility of looking at and developing the plans for a future hospital at Eagle View.

We have agreed and will work positively and constructively on

this particular issue. In addition, because of the circumstances that

I felt were unwarranted by this temporary clinician, I personally

sent a letter of regrets and apology to the chairman and the tribal

council.

I also contacted the family, and also wrote a personal letter to

them.

Senator CAMPBELL. Well, thank you for doing that. Any doctor

that has that kind of a calloused attitude toward anyone that is deceased and their family I think needs to get a different profession.

That is just my personal view. But I know the Fiddler family well.

I know Greg Bourland well, as the Chairman does, and we do

thank you for that.
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I will ask some further questions when it is my turn, again, Mr.

Chairman.

Dr. TRUJILLO. Thank you, very much.

The CHAIRMAN. Senator Domenici.

Senator DOMENICI. Mr. Chairman, let me just take a few minutes. Might I first ask, do we have on record how much the President’s budget is for IHS? Has that already been inquired?

Dr. TRUJILLO. Yes, Senator Domenici; I also submitted a written

statement for the committee, as well as outlining in that discussion

the budgets proposed for fiscal year 2003.

Senator DOMENICI. Let me then move to some specifics within

your operation. I understand that reports and analysis from you indicate that there is 13 percent vacancy rate among professionals in

the Indian Health Service.

I know there are vacancies in every health delivery service in the

country, and their shortages of different professionals in different

regions; nursing being one that is getting very close to being everywhere.

But might I ask, are you doing something exceptional to try to

fill these vacancies? It seems to me, you are going to have to work

very hard, with some innovative ways, some ways of attracting people that are new and exciting or different. Are you doing those

kinds of things in an effort to get some professionals to fill these

vacancies?

Dr. TRUJILLO. Yes, Senator; unfortunately, as you have mentioned, the health care systems across the country are facing some

shortages, especially in some professions. We are seeing that happening in the Indian Health Care System and tribal programs.

In nursing, for example, across the country, you have about an

11-percent vacancy rate. In our dental category, in regards to dentists, we see a high vacancy rate in tribal urban programs, and

that is around about 20 or 22 percent, in all cases.

In pharmacy, we also see this in and outside the Federal services

and Federal programs. The pharmacy vacancy rates are running

about 14 to 15 percent nationwide, within the Indian Health Service.

In comparison to that, the physician vacancy rate is around

about 8 or 9 percent. We are feeling the crunch in nursing, pharmacy, and dentists. Not only have we attempted at enhancing our

program for recruitment and retention of individuals in those categories, we have also had recent authority for special pay in dentistry, and also special pay for oncoming pharmacists. We also have

obtained some special pay for the nursing staff.

Unfortunately, within the Indian Health Service, we are seeing

a number of our nurses are eligible for retirement. So not only are

we planning for new people coming in, but also for replacement, because we see that.

We are also working in concert with the department, with some

of the Secretary’s initiatives on recruitment retention, so that we

are going across the department as a whole, not only developing

plans for recruitment and retention, but also seeing where we can

strengthen each other.
245

Since ours are very diverse localities in our situation, with tribes

and urban programs and Indian Health Service, we are also getting

assistance from the department as a whole.

We have also received additional dollars in the budget to recruit

individuals from the military and the VA, in which cases there has

been some downsizing in their medical facilities. That will help in

the recruitment, retention, loan repayment, and special pay category.

Senator DOMENICI. Well, thank you very much, and I hope your

efforts are successful.

I have two parochial New Mexico questions. But let me first talk

about two illnesses: Severe mental illnesses, schizophrenia, manic

depression, and the like. Currently, the medical practice in the

United States, are the beneficiaries of some new medicines that are

stabilizing, or the first time, for schizophrenics and even manic depressants, and certainly those who have depression.

I just want to ask whether or not, in your pharmacy delivery system for Indian Health, are you providing the most modern drugs

and medications for the mentally ill; or are you unable to pay for

some, thereby denying them the same good new kinds of drugs that

they might get, if they were not at an Indian treatment facility?

Dr. TRUJILLO. In regards to the medications that we have for

mental health illnesses, and the new medications that you are referencing, a number of those, unfortunately, are very high cost

drugs. We also see this in the medications that treat diabetes.

We attempt, as well as the tribal programs attempt, to have appropriate pharmaceuticals and medications on board; or, if necessary, having to order them particularly for a particular patient.

Unfortunately, as we look across the country, in tribal programs,

Indian Health Services, as well as the urban programs, one of the

highest rising cost areas in all of our budgets, delivery systems,

have been the pharmaceuticals. In some cases, we have seen a 31-

percent rise in the cost of providing the same medications.

So when we take a look at how we provided the formularies that

we can specify within our facilities, and ordering special medications, we also encounter the rising costs of drugs.

We are working with the department at the present time on the

overall cost of pharmaceuticals. We are also hopeful that we will

be able to get some relief from other resources that will flow into

the Indian Health Service, because of the overall department’s

plans.

Senator DOMENICI. Mr. Chairman, what I would like to do, with

your permission, I would like to submit, as part of this record, a

list of the kind of medication that is currently being used to treat

the severely mentally ill in the non-arena; and to ask them to inform us whether they are making that available to our Indian people or not.

I do not have the names today, but frankly, there are some people whose family members are going from a catatonic state, with

schizophrenia, to being an able-bodied citizen and a relative who

has almost come back to life, so to speak. But you have to have

medicines to do that.

You and I had to intervene one time, because they were not giving the medicine to the young man who had been very sick for 8
246

or 10 years. I think I told you, once they gave him the medicine,

the young man was well.

In fact, his mother greeted me at an event, and I did not even

know why she was there to thank me. The medicine was too expensive for their pharmaceutical acquisition list. I think we ought to

help the severely mentally ill in a very special way, and make sure

they are getting as good a medicine as non–Indians. That is why

I want to do this exchange, if you would permit it.

The CHAIRMAN. Most certainly, you may do that, sir.

Without objection, so ordered.

Senator DOMENICI. I have two New Mexico questions.

Dr. TRUJILLO. Yes.

Senator DOMENICI. I want to give them to you, and ask my staff

to get answers for them. I have on the Hickory and one on the Albuquerque health care facility.

Now I want to close by telling you that the Indian people are the

beneficiaries of a very, very major effort in diabetes. We started

this program when we put together the balanced budget of 1979,

with $30 million for a special fund for diabetes among the Indian

people. It is now $100 million per year.

I think it is time that some results show from such a major effort. I wonder if you might supply us, for the record, with some

kind of analysis of how far you have come with diabetes treatment,

and where you plan to go, now that there is going to be $100 million a year.

I think we do not need to burden this record with the facts,

again. But if there is a population of Americans that are in serious

jeopardy because of an illness, it is the Indian people and diabetes.

Frankly, we had one expert tell us, if we did not rectify the situation, that there would be no Navajo Indians left, demographically

speaking, in a period of 30 to 40 years, because diabetes is such

a killer, in terms of Indian people.

Are you satisfied with the way the program is being conducted,

and could you supply us with information which might indicate to

us whether the program is doing well or not, Doctor?

Dr. TRUJILLO. Senator, I also want to personally thank you, and

also for the agency, for your efforts in regards to obtaining and assisting with the special diabetes funding. That has been of great

help, not only to the Indian Health Service, but tribal programs.

Yes, we would be very willing and able to provide the committee

and others with appropriate information, followup and also examples of what has been done with these special diabetes dollars, including a lot of concentration on the preventive aspect and the educational aspect.

Unfortunately, for American Indian individuals, this is the

scourge and the epidemic that we see before us, because it also

goes into cardiovascular disease and, as you know, dialysis and

problems down the road.

We also are aware that the special diabetes funding, I believe,

has one more year for the Indian Health Care Programs. The department, tribes, and Indian Health Service, will be working with

the Congress on how we might be able to address the continuation

of such funding, because it has been of such great help in Indian

country.
247

Senator DOMENICI. Thank you.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you very much.

The President’s budget request has an increase of about $64 million for fiscal year 2002. While at the same time, health care for

the American citizen was about $3,800 per year. Indian Health

Service will $1,300 per year for the patients they serve. Will the

$64 million increase bring expenditures closer parity, with that expended an all other all other Americans?

Dr. TRUJILLO. Senator, as you well know, the Indian Health

Service, for many, many years, has had very challenging work always laid out before us. The issues of available resources, the increasing inflation for health care costs, the population growth of

American Indian/Alaska Natives we see across the Nation, continues to be very challenging for us.

I believe that our programs, tribal programs and urban programs, have been quite creative, and have created some programs

that despite always the needed resources that we could use, have

developed good programs.

We have conducted work groups with tribal leadership to identify

direct service costs for patients, in which we serve. It is called the

level of need funding for direct services, where we compare programs and their respective costs, to that of the Federal employee

benefits package. The cost that we have identified for direct services from that particular work group has been around about $4 billion or $5 billion.

The direct services that we can identify with Indian health service amounts to about $2 billion. We are looking at the preventive,

the public health, the facilities, what we call the wrap-around services. We are also identifying those costs, too.

The budget, I believe, for this year, while it is constrained, will

go toward some specific components of high need, in the services,

as well as facilities, construction, and directly to tribes.

Mr. Lincoln, would you like to expand a little bit on our level of

need and our cost per patient?

Mr. LINCOLN. Mr. Chairman and members of the committee, the

increase in this budget cannot make up the difference between

what this Nation pays for in personal medical services, which is in

excess of $3,000 per individual, and what the Indian Health Service has available to it for those same personal medical services,

$1,300. This budget will not make up that difference.

The CHAIRMAN. How much more would we need?

Mr. LINCOLN. Based upon this level of funded need study that

Dr. Trujillo referred to, if you look at the number of users, Indian

people that use the system, whether it is Federally operated, tribally operated programs, there are approximately 1.4 million to 1.5

million Indian people who use the system.

If the average, just in terms of round numbers, is $3,000 per individual, therefore, there would be a need of about $4.5 billion, in

order to meet this need.

The CHAIRMAN. So the President’s budget is short $4.5 billion?

Mr. LINCOLN. We currently have approximately $2 billion for personal medical services. So if we were to meet the difference be-
248

tween $4.5 billion and $2 billion, there would be a need of $2.5 billion.

The CHAIRMAN. The 2000 Census indicates that 57 percent of

American Indians and Alaska Natives now reside in urban areas.

However, the President’s budget request includes only a $581,000

increase in funding for urban Indians. Is that amount proportionate to the increase in the urban Indian populations?

Dr. TRUJILLO. There has and continues to be a shifting of the Native American population into more metropolitan areas. We have

been working with the urban programs, as well as with tribes, to

identify some of the high priority issues.

Over the past several years, we have developed a program for epidemiology, to obtain statistics, resources, and health care data, so

that we can verify and assist the tribal programs in resources.

We have also attempted to build the infrastructure for administration training, as well as data programs, among all the urban

programs over the past years, including this particular year.

The other areas that we are working on, with the department as

a whole, especially through SAMSA, HRSA, and CDC, are availability of funds from their particular programs, that can flow into

local governments, city governments, community health centers,

migrant health centers, the cooperation between those respective

agencies, and working with them, with the urban health care programs.

So what you see in the budget in the Indian Health Service is

not all the dollars that go to urban programs. We also are able to

hopefully access now, and in the future even more, resources from

especially the community health center programs.

We also have collaborative efforts in the increased amount of dollars that are going to build back the national health service core

and the clinicians that come out of that. Those individuals will

then also be coming not only to tribal programs, but also urban

programs.

We also have the diabetes funding, that has gone into urban programs and are part of the overall effort for education and direct

services and prevention.

The CHAIRMAN. These funds are available, but are they being

used?

Dr. TRUJILLO. Yes; they are being used. They are also being leveraged by many of the urban programs. The Indian Health Service, in some programs, is not the only source of dollars. They have

also been very fruitful in their collaborative efforts, being able to

obtain outside grants; being able to obtain programs that are available for them, either through Federal or State programs, university

or other health care corporations. So our Indian Health Service dollars are also leveraged with that facility.

The CHAIRMAN. The budget request submitted by the President

involves a restructuring proposal.

For example, it proposes a consolidation of public affairs, legislative, human resources, staff functions, and funding from the departmental agencies where they are currently located, to the Office

of the Secretary.

In addition, the budget request proposes further consolidation of

facilities construction, and that is hospitals, management and
249

maintenance staff, functions and funding, in fiscal year 2004, to the

Secretary.

Now with that type of consolidation, do you believe that the

United States’ trust responsibility for the health care of American

Indians and Alaska Natives will be hurt? Put another way, in a

much plainer way, if a hospital building in Indian country comes

up in contest with a building in NIH, which will be accorded the

higher priority?

Dr. TRUJILLO. Senator, the question is very thoughtful, and I believe it is an issue that the department, the Secretary, and the

agency, and tribes are now working on.

I do believe that the initiatives of the Secretary and his efforts

in a one department collaboration, with collaborative support, will

bring about additional resources to Indian country from other agencies within the department. I believe they also will have an increased responsibility for delivery of that care, and that the Indian

Health Service is not the sole responsible party; but other agencies

are.

At the present time, we are studying the efforts for consolidation,

especially when you mentioned facilities. The department is now

gathering information, the data specifics of how this consolidation

might occur, if it were to occur in the future.

I believe that if we have a priority system, and I would have to

say here, the department continues to be very impressed with the

priority system of the Indian Health Service, and have also us to

explain that in more detail as we go through the consolidation.

I believe, given the special relationship of the government-to-government belief in the Secretary and his concern of consultation and

involvement, that certainly the highest need of Indian health care

facilities will be right there on the desk for the priorities of the department.

The CHAIRMAN. That is your personal view?

Dr. TRUJILLO. That is my personal view.

The CHAIRMAN. And your priorities will be consolidated or

merged with those of the Department?

Dr. TRUJILLO. I believe the Indian Health Service will also have

a primary role to perhaps access additional dollars from other resources.

This particular effort is now being steadied by the department

right now. We have also involved tribal leadership in a restructuring committee, to look at the options and look at the recommendations that have come from the department, so that they too will

have an input directly not only to the agency, but also to the department.

In addition, the Office of General Counsel is also looking at some

of the specifics, as it relates to the special relationship between

tribes and the Federal Government, and the department, as well

as the new legislation regarding title 5 and title 6.

The CHAIRMAN. My interpretation of history would suggest that

whenever functions are consolidated, the priorities of Indian country always seems to fall to the bottom of the list. Otherwise, how

can we continually have situations where the average American

health care expenditure is $3,800, and the average Indian health
250

care expenditure is $1,300 or less than a one-third of the average

expenditure for all other Americans?

I mean, this is not parity, and I am afraid that this consolidation

will further exacerbate the situation. I know that you have great

faith in the Secretary, but Secretaries come and go. We have no

idea who the next Secretary will be, but we know what the law will

be.

The attitude of the people of the United States, history shows

this. We have enacted all kinds of laws, hoping that we could correct this.

The President’s budget request, for example, has an increase of

83 full-time equivalents to staff new facilities, when you know that

you need 183. Now how have they done this? They gave you 83

full-time, and they take away 100 Fte’s from other areas. Is that

not correct?

Dr. TRUJILLO. When we construct new facilities, staffing is usually at the level of 80 percent, and we do not staff, unfortunately,

facilities at the 100 percent level. The funding that we have in the

budget at the present time is for the completion of hospitals that

are now ongoing, that is, at Winnebego, NE, Parker, CO, and Fort

Defiance, AZ.

The initiatives, I believe, with the involvement of tribal leadership, and I believe the department and the Secretary, as well as

this agency, certainly has brought tribal leadership in the consultation and the development of policy, and the options available.

As long as I certainly am the Director, I will commit to the involvement of tribal leadership in the development of policy,

changes, and structure for the agency, because I know it directly

affects the patients we care for, and it affects the people that I will

go home to.

The CHAIRMAN. Well, I personally feel it is rather tragic, when

you announce with great flair that we are going to have 83 new

full-time equivalent positions to staff facilities, and then in fine

print elsewhere, you will find that we have reduced 100 in other

areas.

Dr. TRUJILLO. In regards to the reduction, there are efforts by

the department, the agencies across the department, as well as the

President’s initiative, to assure that there is increased effectiveness

and efficiency. We will not be decreasing service.

The CHAIRMAN. I would like to see this efficiency exercise carried

out in all other agencies. Apparently, the only one who gets the efficiency exercise is Indian Health Service. I am trying to defend

you, you know. I am not fighting you. [Laughter.]

Dr. TRUJILLO. In fact, we will become more efficient across all the

agencies.

The CHAIRMAN. So you will be much more efficient with less people?

Dr. TRUJILLO. Senator, there are pluses and minuses in any restructuring effort. However, I do believe that changes are always

necessary in a re-examination of any Federal agency or program,

to make sure that the dollars are there, that the effectiveness is

there, that the changing conditions that we deal with, including the

changes in the needs of people that we serve are reflected in our

we do business.
251

I believe we can always do better. But it is also necessary to

make sure that the people we serve and the communities we serve

have input into that process.

The CHAIRMAN. I have one final question, sir, and I would like

to submit the rest to you. There seems to be a trend, if one looks

at the budget request, where the Government of the United States

is very deliberately transferring activities that they were responsible for, to private agencies such as education. It would appear

that this may go into health care, also.

Does this mean that the U.S. Government is slowly washing its

hands of the United States’ trust responsibility?

Dr. TRUJILLO. Again, I believe that is a very thoughtful question,

and a very excellent question. I do not believe, in this particular

case, that we are devolving the Federal responsibility of health care

programs.

In fact, at the present time, we have many localities in particular

situations, where we do outsource or contract with private programs to provide services, radiology, laboratory. It depends upon

the circumstances.

We also have divulged the Federal direct responsibilities in one

respect, and transferred them to tribal nations, in which they now

administer and manage Federal programs. Over 52 percent of the

Indian Health Service budget is now managed and administered by

tribal programs. That also is reflective, in part, of the budget proposals, and we will continue to have emphasis upon that self-determination.

There are some localities where tribes and Indian Health Service

do not find it effective and cost effective to contract out particular

services. However, there are some cases and some services where

it may prove to be more cost effective and beneficial in particular

localities.

The CHAIRMAN. At this moment how many men and women are

under your command?

Dr. TRUJILLO. We have approximately 14,000, plus or minus.

The CHAIRMAN. With the new President’s budget, how many men

and women will be under your command?

Dr. TRUJILLO. It will remain approximately the same. The shift

has been in our restructuring, a downsizing of our headquarters

and area offices, to such an extent, when I first came in as the Director, there were headquarters personnel of over 900. We now

have a little over 300. Those positions have shifted out to the field,

especially to service units, to provide increased services.

The CHAIRMAN. Thank you very much, Dr. Trujillo.

Senator CAMPBELL. I have maybe a couple more questions, Mr.

Chairman, and thank you.

I have been listening very intently. I think when you talk about

reducing your FTEs, that causes some alarm; but on the other

hand, I understand that some of it is because of the tribes picking

up the responsibilities underIndian Self-Determination Act agreements, and the manpower goes up there, as it goes down at the

Federal level. I assume that is where the disparity comes in.

Dr. TRUJILLO. Yes.
252

Senator CAMPBELL. My big concern is to obviously make sure

that the services are provided, and that the Indian people are not

being denied.

Let me just reflect for a minute on the comments of Senator

Domenici and Senator Inouye, too. When the question of the census

came up, you know, I tell you, raw numbers are always kind of suspect to me.

Because as I understand it, between 1990 and the year 2000, literally every American Indian woman in the country would have

had to had about five children per year, to make up the difference

in what the 2000 Census said of the number of Indian people in

the country, over what 1990 said. Somehow, I do not think that

happened.

I think more likely, it was what I sometimes refer to as the ‘‘Dances with Wolves Syndrome.’’ It got awfully popular after

Dances with Wolves to be an Indian. So a lot of people in the census, since they do not have to prove anything, they just can say

they are. I think we get this hugely inflated number, but probably

a lot of it is not really valid.

Let me just maybe mention something along the lines of what

Senator Domenici said. You know, I never heard Indian people who

say, 200 year ago or 150 years ago, I never read of it in any historical documents, where they suffered high diabetes.

Dr. TRUJILLO. That is right.

Senator CAMPBELL. They had a very simple food source. It was

natural foods, right from the earth. Now they have probably the

highest diabetes of any ethnic group in the Nation, or at least that

is my understanding. That means it has got to be something to do

with lifestyle and diet, that has changed over the last 100 to 150

years, or something of that nature.

If you asked the average guy in the street if he knows what the

word ‘‘commodity’’ means, they would go blank. But I see the expression on your face. You know what it means, and I know what

it means, and every Indian person knows what it means. It means

starchy processed foods that come often from Government surplus

stores, in cans without labels or just white labels that say, ‘‘beans,’’

or something of that nature.

So I am convinced, and I am sure medical science would testify

to it, that it has to do with diet and lifestyle. It is not just genetic.

It has to do with the changes.

So I guess when I think of what we are trying to do to improve

the health of Indian people, my gosh, there has got to be a limit

of how many dialysis machines we can buy. It does not get to the

root problem.

I guess my question to you, Doctor, is what are we doing about

the root problem? Are we trying, through the IHS, to I do not

know, have seminars or something about better diets? I know some

of that is our problem, too, as appropriators. Senator Inouye is

aware of this, and I am too. I mean, sometimes we are not providing the amount of funds we need.

But it seems to me we ought to be looking a lot more at prevention, rather than just more and more machines, and more and

more doctors, and more and more hospitals and all that. It does not

get to the root of what health is all about, to my way of thinking.
253

Would you reflect on that, just for 1 moment?

Dr. TRUJILLO. I fully agree with the emphasis on the commitment and the necessity of personal health care and responsibility.

One of the areas that the special diabetes funds have been utilized in, is in that particular area of health education, early detection, and awareness. We have grants to communities, tribal programs, and urban centers, which a lot of those dollars have been

utilized in that particular effort, especially working with the youth

or those individuals who are high risk individuals, to make them

aware of what their consequences and their choices may lead to.

In addition, we have also been working with other outside agencies. For example, just recently, a contingent of teenage individuals

came into Washington, DC from Ft. Peck. At the end of last year,

they boycotted the school lunch program, because there were fats,

there were sweets. Because of that, they were able to change the

diet of that particular school.

They met with the director of the Department of Agriculture, and

we asked questions of how to do this, what they can do. We have

also been working with youth in other areas.

You mentioned that you and I are familiar with commodities.

Unfortunately, I still have pangs for a craving for Spam, every once

in awhile. [Laughter.]

Senator CAMPBELL. Yes; that is what happens when you are

raised on it. I know.

Dr. TRUJILLO. But on a recent occasion, I happened to visit a

community in the Southwest. I will not mention where. A small

school bus came up that had Headstart kids in it.

They came into the restaurant, which was a fast food restaurant.

Some of the children were overweight, and some of the sponsors

were overweight. They lined up. They got large cokes. They got

fatty foods with the Egg McMuffins, or other things similar to that.

They got the fried potatoes, and all of them sat to eat that for their

breakfast meal.

When we do that, or our teachers do that, what types of messages are being sent to the children? That is where we are attempting to make the inroads, such as these kids that came from Ft.

Peck.

Senator CAMPBELL. Oh, I understand that. I mean, I like fried

bread probably as much as the next guy. It is probably the worst

thing in the world you can eat, from the standpoint of health.

May I recommend, when you have time, the next time you are

in the Southwest, that you visit the Southern Ute facility that was

just built. That happens to be my hometown, and that is why I

know about it.

They built a really marvelous kind of health complex. It has a

gymnasium and it has a swimming pool. But in addition to that,

they offer healthy living classes and even offer cooking classes.

They just opened it a couple of months ago. One-third of the whole

tribe has already signed up to use that facility.

They have the same problems as every tribe, with diabetes, and

being overweight, and so on. I think that things like that could be

a role model of what we ought to be doing; not just from the standpoint of weights and cardiovascular machines and treadmills and
254

all that; but with the emphasis put on healthy living and diet and

cooking. So I would recommend you visit that, if you can.

Just let me ask you one last little question, and that is this. I

understand that when young Indian physicians graduate, that current policy prevents them from serving in their own tribal community.

I find that kind of strange, because if there is anything that Indian kids need, it is role models of people that have been successful, that happen to be their uncles or their cousins, or somebody

that they know.

Do you know if that policy is in effect or not?

Dr. TRUJILLO. No; I am not aware of that policy. In fact, when

I finished my medical residency training, I went back home in the

Public Health Service and the Indian Health Service.

The CHAIRMAN. You did?

Dr. TRUJILLO. I was expecting to stay 2 years for my commitment. However, I have now stayed over 20 years.

No, if there are available positions; if a tribe or that clinic is

available, and if they do have open vacancies, yes, they can be

hired at that facilities.

I also believe that strong role models are essential, and the necessity for young Indian physicians to be out in the field, to go to

schools, to be there, and to live there, is critical.

I just came from the University of Seattle, where I gave a lecture

to young Indian clinicians, medical students. In the room were

practicing clinicians in the Northwest, who are of Indian heritage.

They had come to the University of Washington Indian Program

early on. They went to the medical school. They went to the residency, and now they were sitting in the chairs on the other side,

as practicing clinicians, and they were practicing in Tribal and Indian Health Service programs. What better model and mentoring

can they do?

Senator CAMPBELL. Well, we are in agreement on that.

Dr. TRUJILLO. And I hope we can provide that support.

Senator CAMPBELL. Thank you, Mr. Chairman. I would like to

submit the rest of my questions in writing to Dr. Trujillo.

The CHAIRMAN. Thank you very much, Dr. Trujillo. As indicated,

we would like to submit to your office several questions to be answered.

Dr. TRUJILLO. Yes; thank you, sir.

Senator can I just interrupt? Senator Campbell asked a question

about mentoring of Indian students. In fact, in the audience we

have here a young Indian physician, who is a public health service

co-step, Mike Bartholomew, who is in medical school at Dartmouth.

Senator CAMPBELL. He is in medical school now?

Dr. TRUJILLO. In Dartmouth.

Senator CAMPBELL. And where is he?

Dr. TRUJILLO. Stand up, Mike.

Senator CAMPBELL. Good, great, thank you.

Dr. TRUJILLO. He is one of many.

The CHAIRMAN. Thank you very much.

Dr. TRUJILLO. Thank you.
255

The CHAIRMAN. Our next witness is the assistant secretary of the

Office of Public and Indian Housing, United States Department of

Housing and Urban Development, Michael Liu.

Secretary Liu, it is always good to have with us.

STATEMENT OF MICHAEL LIU, ASSISTANT SECRETARY, OFFICE OF PUBLIC AND INDIAN HOUSING, DEPARTMENT OF

HOUSING AND URBAN DEVELOPMENT

Mr. LIU. Thank you, Mr. Chairman and members of the committee. Thank you for inviting me to provide comments on President

Bush’s budget for HUD’s Indian Housing and Community Development programs for fiscal year 2003.

My name is Michael Liu, and I am the Assistant Secretary for

Public and Indian Housing. I am responsible for the management,

operation, and oversight of HUD’s Native American programs.

These programs are available to over 550 federally-recognized and

a limited number of State-recognized Indian tribes.

We serve these tribes directly, or through Tribally Designated

Housing Entities, by providing grants and loan guarantees designed to support affordable housing and viable community and

economic development.

Our clientele in diverse. They are located on Indian reservations,

in Alaska Native villages, and in other traditional Indian areas.

More recently, this list has grown to include Native Hawaiians.

It is a pleasure to again appear before you, and I would like to

express my appreciation for your continuing efforts to improve the

housing conditions of American Indian and Alaska Native peoples.

As you have heard in the tribal testimony at the recently held

NAHASDA hearing, much progress is being made, and tribes are

taking advantage of the improvements to the law in housing conditions of the Native American families residing on Indian reservations, on trust or restricted Indian lands, and in Alaska Native villages, and are moving ahead in the right direction.

This momentum needs to be sustained, as we continue to work

together toward creating a better living environment across Indian

country.

At the outset, let me reaffirm the Department of Housing and

Urban Development’s support for the principle of government-togovernment relations with Indian tribes. HUD is committed to honoring this fundamental precept in our work with American Indians

and Alaska Natives.

You may recall that when I testified before you last month, I confirmed that the department was searching for a deputy assistant

secretary for Native American programs. Tribal representatives

and members of this committee spoke in support of setting the

level for that position to Senior Executive Service.

In the spirit of cooperation, Secretary Martinez has agreed to readvertise for the position as an SES. All approvals have been received and granted, and I am looking toward having that advertisement on the web toward the later part of next week, sir.

For fiscal year 2003, the President’s budget proposes a total of

$740.5 million, specifically for Native Americans and Native Hawaiian housing, community and economic development, and education programs.
256

Of that amount, approximately $639 million is for direct, formula

allocations under the Native American Housing Assistance and

Self-Determination Acts Indian Housing Block Grant Program; $71

million is for grants under the Indian Community Development

Block Grant Program; and $7 million is for the Native American

Section 184 and Title VI loan guarantees. That loan authority will

leverage $214 million in loan guarantees.

The Native Hawaiian community will receive, through the Department of Hawaiian Home Lands, $10 million for the Native Hawaiian Housing Block Grant Program, and $1 million for the Section 184A, Native Hawaiian Loan Guarantee Fund, which will leverage approximately $40 million in loan guarantees. There is $5.6

million available for training and technical assistance to support

these programs.

Finally, the department requests $5.4 million to support American Indian, Alaska Native, and Native Hawaiian-oriented higher

education institutions.

Next I will address the Indian Housing Block Grant Program.

Adjustments to the IHBG program have been made to allow for

more funds to be available for tribal use. The fiscal year 2003

budget includes $646.6 million for the IHBG program. Although

this is a decrease of $2 million from fiscal year 2002, by reducing

set-asides, there will actually be allowed $6.4 million more in grant

dollars available to the tribes. The decreases in set-asides are from

the training and technical assistance category, Title VI Program,

and Working Capital Fund.

The training and technical assistance component of this program

has been reduced to $3 million, down from $5 million in the previous year. This action was taken in recognition that several years

have passed since implementation of this program, and most tribes

have been provided with the initial and in depth training and technical assistance necessary to implement most of the new and

sweeping changes in the way in which we now do business.

Training and technical assistance remains a critical component of

the program, and we propose that a portion of it be accomplished

in partnership with the National American Indian Housing Council. The President’s budget includes a $2.2 million set-aside from

the IHBG program, to continue the same level of support as provided in last year’s budget to the NAIHC.

These funds, as in the past, will be made available under a contract to the organization, in return for their training and technical

assistance services to NAHASDA grantees.

I would encourage the HAIHC to work with the department to

ensure that these funds are obligated expeditiously, and that the

training and technical assistance occur as soon as is feasible.

In fiscal year 2000, HUD executed a $2-million training and

technical assistance contract with NAIHC. As of December 2001,

less than $500,000 of those funds had been expended.

The Title VI Loan Guarantee Fund is also a set-aside under the

IHBG Program. This budget recognizes that until the program is

more fully subscribed, it is more effective to use available funds in

the IHBG program, and allocate it by formula directly to IHBG

grantees.
257

There is sufficient carryover of unused guarantee authority

which, when combined with this year’s budget request, will support anticipated future program needs. This allows $4 million to be

added back to the IHBG formula.

As for the working capital fund in the department’s fiscal year 2002 IHBG appropriation, not less than $3 million was allocated.

In attempt to better prorate the amount required from each program, it was determined that the amount allocated from the fiscal

year 2003 IHBG account could be reduced by $600,000. This $2.4

million reduction from the fiscal year 2002 appropriation is included in a direct appropriation to the working capital fund.

Last year, the Section 184 Indian Housing Loan Guarantee Fund

received its first annual credit subsidy re-estimate, as required by

the Credit Reform Act. The re-estimate resulted in a reduced subsidy rate, which tripled loan amounts available for guarantee when

holding budget authority constant during fiscal year 2002.

The subsidy rate declined due in part to the low number of de- faults. The $1 million reduction in the fiscal year 2003 budget request reflects the impact of that recalculation, adjusted by anticipated utilization, so that, in fact, the $5 million in fiscal year 2003

will provide $197.24 million in loan guarantee authority.

The President’s fiscal year 2003 budget request for the Indian Community Development Block Grant Program is $72.5 million.

This budget will provide an increase of $2.5 million over the

amount appropriated in fiscal year 2002, and $1.5 million was allocated to the operation of the Native American Economic Development Access Center, Native Edge.

Native Edge, which began as a pilot project within the department, is now an inter-agency initiative, linking 18 Federal agencies, through a single economic development access center, so that

tribes, Native Americans, lending institutions, non-profit foundations, and private businesses can collaborate to promote economic

growth and find innovative solutions to chronic economic development problems in Indian country.

The President’s budget requests that $1.5 million be set aside

from the ICDBG allocation to continue support of this award-winning and much needed initiative.

For fiscal year 2003, the department is requesting $10 million for

the Native Hawaiian Housing Block Grant Program. This budget

recognizes the unique housing needs of Native Hawaiian families,

eligible to reside on Hawaiian homelands, and the department is

now beginning to meet those needs.

A further acknowledgment is the establishment of a separate

program account for the Native Hawaiian Housing Block Grant

Program. It is anticipated that an interim regulation implementing

the new Native Hawaiian Housing Block Grant Program will be

published in the Federal Register within the next 2 months.

This action will facilitate immediate distribution of funds and implementation of the program, while public comments are being received toward publication of final regulations.

The budget also requests that $1 million be allocated to the Section 184(a) Native Hawaiian Housing Loan Guarantee Fund. At

that level of funding, this new loan guarantee program, modeled

after the section 184 program, will provide up to $40 million in
258

loan guarantee authority, to guarantee market rate mortgage loans

to income eligible Native Hawaiian families, who choose to reside

on Hawaiian Homelands.

The Department of Hawaiian Homelands, a State agency, is the

programs partner. DHHL is the agency responsible for allocation of

leasehold interests on the Hawaiian Homelands. Program procedures will mirror the section 184 program as closely as is appropriate.

Until direct endorsement lenders are approved, ONAP will work

closely with DHHL and individual borrowers to review, underwrite,

and issue guarantee certificates for all loans.

The President’s budget also requests, under the Community Development Fund, $3 million for competitive grants to tribal colleges

and universities, to provide resources to build, expand, renovate

and equip their facilities; and $2.4 million to assist Alaska Native

and Native Hawaiian-serving institutions, as they are defined

under the Higher Education Act, as amended.

In conclusion, let me state for the record that the President’s

budget request for HUD’s Indian housing, community development,

and education programs supports the progress being made by

tribes in providing housing and housing-related endeavors in Indian country.

This concludes my remarks, Mr. Chairman, and I would be

happy to answer any questions you may have.

[Prepared statement of Mr. Liu appears in appendix.]

The CHAIRMAN. Thank you very much, Mr. Secretary.

Mr. LIU. Thank you.

The CHAIRMAN. First, I would like to commend you for responding to and resolving the so-called downgrading problem that we

discussed 3 weeks ago.

Mr. LIU. Yes, sir.

The CHAIRMAN. I can assure you that the tribal leaders are most

pleased with the responsiveness of your agency. I hope that this

will be a hallmark for future consultation with tribes.

I am certain you are aware that tribal leaders have requested

the establishment of a 58 member negotiated rulemaking committee. What is the status of that now?

Mr. LIU. We have had at least two meetings with tribal leaders

to discuss the issue of consultation, negotiated rulemaking, Mr.

Chairman.

I believe that it will take a number of other meetings for us to

define further the issues of concern, to look at the size of the committees that are being discussed, to consider what type of processes

we have involved, as I mentioned last time, so that we can balance

the need to respect the request for government-to-government relationships and consultation, as well as to be able to get the job done

and making our programs workable.

I think they have been very fruitful, and I am very hopeful that

before the summer, we can get this issue resolved in a manner

which is satisfactory, both to them and to us.

The CHAIRMAN. I thank you very much, and I hope it will be settled.

Mr. LIU. Yes, sir.
259

The CHAIRMAN. The committee is advised that the level of need

for Indian housing is $1,075,000. Does this estimate jive with

yours?

Mr. LIU. Well, we have some questions about the assumptions

and the analysis involved in that report, Mr. Chairman. We do not

argue with the fact that there is need. From that, we are all on

the same page.

Without getting into the specifics of where there may be some

differences about the $1.75 billion, we believe that the $646 million

or $647 million in our budget will adequately take care of the

needs in fiscal year 2003.

We look at the hold-over budget authority under the 184 program and the Title 6 programs, both of which approximate about

$246 million. We added that to the actual request within our budget.

In addition, when you look at the resources being provided to the

rural housing services and USDA, the new tax credit programs, the

new market venture tax credits, renewal community tax credit programs, and new private sector endorsements and commitments

from the GSEs to even do more on Indian lands, we think that for

fiscal year 2003, that there are adequate resources to deal with the

housing needs.

The CHAIRMAN. Would the department support or oppose an attempt by the Congress to increase the $646 million?

Mr. LIU. Mr. Chairman, the department will, of course, work

with Congress in developing our budget as a whole, as well as it

deals with Indian country. Whatever obviously is put into law by

the end of this fall, we will work very closely with the committee

and others to implement in the manner which, of course, would be

intended.

The CHAIRMAN. As you know, Indian country has been concerned

about staffing of field offices. Are you satisfied that is moving

along?

Mr. LIU. I think I am satisfied. That is something that I am personally taking a very active role in, in making sure they are going

forward as the department, as a whole, goes through some realignment, and that our Office of Native American Programs is a net

gainer in that process. We are, so far, and I would like to see that

occur even more.

The CHAIRMAN. I am certain you are aware that Indian country

is concerned about black mold in their housing. Is your organization doing anything about this?

Mr. LIU. Well, as you know, sir, we have moved ahead to implement the set-aside, which was provided for last year. I also understand there has been some additional moneys accessed through our

CDBG program, to work in that arena.

This is to confirm this question, at the last hearing, in regards

to the availability of our lead-based paint program, a healthy

homes program, that might address some of the black mould

issues, also. The answer is definitely, yes. There is the chance for

tribes to access those funds through the grant process.

The CHAIRMAN. Would your agency oppose an increase by line

item for lead paint?
260

Mr. LIU. Mr. Chairman, I think, again, as per the whole issue

of increased allocations we, of course, will work with the tribes,

with the agencies, to address the needs with resources available.

I think one of the issues that would have to be looked at would

be how targeted are the dollars; will it go to a wider array of tribes

than was done last year? I think on those issues, certainly, we are

open to discuss this with the Chairman.

The CHAIRMAN. On Native Hawaiian housing, have you selected

a staff to serve in Hawaii?

Mr. LIU. We have started to jump start the process. Yes, I have

selected an individual who would be there before the end of the

month, who will start on an interim basis, at least up to 6 months,

because then we are going to have to go through the advertisement

process for a permanent person. So, yes, a person has been identified.

The CHAIRMAN. When do you think the first block grant will be

issued?

Mr. LIU. Two months; but I am hoping we can shave a few weeks

off of that. I have been personally involved in the finalization of the

interim regulation, and I am hopeful that we can shorten up that

timeframe a lot. But I think, at this point, 2 months is a safe

guess.

I have been in touch with the director of the Department of Hawaiian Homelands. I have met with him twice within the last 2

weeks. I have been very pleased with the cooperation that we have

had with the State.

The CHAIRMAN. It is my understanding that when the Drug

Elimination Program was discontinued from the department’s

budget in 2001, the public housing operating fund was increased by

$150 million, to be used for anti-drug activities.

But as you know, the tribes do not qualify for such public housing operating subsidies, so they have no replacement funding for

their drug elimination activities.

Is something going to be done about this?

Mr. LIU. Well, Mr. Chairman, the position of the Administration

in the elimination of the Drug Elimination Program was based on

the premise that the program, as designed, had a lot of flaws. We

saw an array of dollars being utilized for purposes that were tenuous, at best, in terms of their connection to drug elimination.

Our increase in request for the operating subsidy was based on

our continued concern for the need to deal with public safety issues

as a whole. To the extent that the tribes can utilize their block

grant dollars for public safety issues, we certainly will encourage

that, if those public safety programs make sense.

To the extent that we can bring to the table other Federal resources, and work with the Department of Justice in linking them

with the tribes, we are working to do that.

Finally, we will be aggressively working with local leaders,

whose jurisdictions, counties, towns, cities, and villages, might incorporate at least part of the regions where Native Americans reside; if not on tribal lands themselves, but to emphasize that Native Americans are citizens of their communities also, and deserve

the same type of public services that other residents do.
261

The CHAIRMAN. As you know, in certain areas, the problem of

drugs may be worse than in the city.

Mr. LIU. Yes.

The CHAIRMAN. I most respectfully suggest that your office sit

down with tribal leaders to work out some sort of effective program

to combat drugs, because it is a very, very serious problem.

The President’s budget cuts Rural Housing and Economic Development Programs. As you know, there were tribes who were using

the Rural Housing and Economic Development Program funds for

capacity building, which is essential for self-governance.

Now the Administration has said that they support Indian selfdetermination and tribal self-governance. If that is the case, what

is the justification for eliminating this program?

Mr. LIU. The primary justification, sir, was that we thought that

we saw duplication, with services being provided by the Department of Agriculture, through its rural development agency; specifically, its rural housing services, as well as its business and cooperative services arena.

With the long history, and much of it is successful, under USDA,

we felt that they would be the more effective entity to develop the

type of capacity building, the type of housing assistance, which we

were attempting to get involved in.

So primarily, to avoid duplication and leave it to the agency

which is doing an effective job, that was the motivation and the underlying policy reason for the elimination of the program here at

HUD.

The CHAIRMAN. Did you discuss this and explain it to the tribal

leaders involved?

Mr. LIU. The position and the policy decision was discussed at

meetings, I understand, by staff, and not by myself, personally. To

the extent, if there is need to do more and to better explain that

issue, we can do that.

I have been asked by the Secretary, as well as by Secretary

Veneman, to act as the liaison between the two departments on

housing issues, and I can certainly work in that role to do a better

job.

The CHAIRMAN. It is my understanding that the department

maintains a Public Housing Disaster Fund to address unexpected

emergencies. How much was allocated to this emergency fund in

fiscal year 2002?

Mr. LIU. There is, in Indian housing, apart from public housing,

a $2-million set-aside, operationally, that we have had for a number of years that is available to tribes, at $350,000 maximum per

incident, per application, that has been available.

This is separate from what we do in public housing, where out

of its capital fund program, there is a special set-aside for the public housing authorities.

The CHAIRMAN. But it will not reduce the Block Grant Program?

Mr. LIU. No.

The CHAIRMAN. Well, Mr. Secretary, I thank you once again for

your participation in this hearing. We appreciate your wisdom and

your testimony, and we look forward to continue our working with

you. Just keep up the consultation with the tribes. They appreciate

it.
262

Mr. LIU. Thank you very much, Mr. Chairman.

The CHAIRMAN. Thank you very much.

[Whereupon, at 11:45 a.m., the committee was adjourned, to reconvene at the call of the Chair.]
(263)

APPENDIX

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

PREPARED STATEMENT OF HON. PETE V. DOMENICI, U.S. SENATOR FROM NEW

MEXICO

Mr. Chairman, I would like to thank you for holding this hearing today with the

Indian Health Service [IHS] and the Department of Housing and Urban Development [HUD], which provide key services to Indian Nations.

I know that the Indian Health Care system continues to face competing priorities,

escalating costs, and an increase in patient demand for not only more services in

acute and urgent care treatment, but for better access to basic health services.

We all know that the Nation is facing a nursing shortage. Well, IHS has an even

greater burden of filling professional vacancies. In fact, IHS reports an overall vacancy rate for health professionals of approximately 13 percent. IHS is attempting

to address this issue by recruiting former military health professionals to work for

IHS. But more help in this area is needed. Not only for recruitment, but we must

address how to retain the qualified personnel. Even qualified American Indians are

leaving IHS facilities, because they are afforded better working conditions, the latest

medical equipment and let’s face it, higher salaries than what IHS has to offer.

In my State of New Mexico there are numerous funding issues with tribal, Federal and urban Indian health care. In order for IHS to maximize their alternate resource dollars, estimated at $508.8 million dollars, there must be a commitment toward providing and improving information systems that will assist in efficient billing and collection.

The age-adjusted death rates are alarming. American Indians and Alaska Natives

score higher in almost all health categories: alcoholism, diabetes, tuberculosis, cancer, obesity and sadly, the number of young people impacted are escalating as well.

I am proud to see a number of diabetes prevention activities and diabetes care

programs now taking place within Indian Country. Hopefully, the prevention efforts

will start revealing lower numbers in the cases of diabetes for the American Indian/

Alaska Native populations.

The Department of Housing and Development administers important housing programs such as: The Indian Community Block Grant, The Native American Housing

Block Grant, The Indian Housing Loan Guarantee Fund.

Further, the Native American Housing and Self-Determination Act (NAHASDA)

is scheduled to be re-authorized this year. NAHASDA is one of the more successful

pieces of legislation in Indian Country. This legislation is very important to Indian

country resulting in placing thousands of needy Indian families into new homes.

Yet, there is more work to be done. I look forward to working with the Administration, other Members of Congress, and Indian Nations in getting NAHASDA re-authorized.

With regards to the fiscal year 2003 budget request, I commend the President for:

The $3 million increase in the Indian Community Block Grant program. The $55

million for the Resident Opportunity and Self-Sufficiency [ROSS] program. The $5.4

million for tribal colleges and Alaska Native and Native Hawaiian-oriented higher

education institutions.
264

With that, I do have several concerns regarding the budget request. Chief among

my concerns is that there is no request for the Rural and Economic Development

Grant program. The program provides much needed economic development assistance in Indian country.

Mr. Chairman, I look forward to hearing from the witnesses today and I have several questions to submit.

PREPARED STATEMENT OF MICHAEL LIU, ASSISTANT SECRETARY PUBLIC AND INDIAN

HOUSING, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Mr. Chairman, Mr. Vice Chairman, and members of the committee, thank you for

inviting me to provide comments on President Bush’s budget for HUD’s Indian

Housing and Community Development programs for fiscal year 2003.

My name is Michael Liu, and I am the Assistant Secretary for Public and Indian

Housing. I am responsible for the management, operation and oversight of HUD’s

Native American programs. These programs are available to over 550 federally recognized and a limited number of state-recognized Indian tribes. We serve these

tribes directly, or through tribally designated housing entities (TDHE), by providing

grants and loan guarantees designed to support affordable housing activities and

viable community and economic development. Our clientele is diverse; they are located on Indian reservations, in Alaska Native Villages, and in other traditional Indian areas.

In addition to those duties, my jurisdiction encompasses the public housing program, which aids the nation’s 3,000-plus public housing agencies in providing housing and housing-related assistance to low-income families.

It is a pleasure to again appear before you, and I would like to express my appreciation for your continuing efforts to improve the housing conditions of American Indian and Alaska Native peoples. As you have heard in the tribal testimony at the

recent NAHASDA hearing, much progress is being made and tribes are taking advantage of new opportunities to improve the housing conditions of the Native American families residing on Indian reservations, on trust or restricted Indian lands and

in Alaska Native Villages. This momentum needs to be sustained as we continue

to work together toward creating a better living environment across Indian country.

At the outset, let me reaffirm the Department of Housing and Urban Development’s support for the principle of government-to-government relations with Indian

tribes. HUD is committed to honoring this fundamental precept in our work with

American Indians and Alaska Natives.

You may recall that when I testified before you last month, I confirmed that the

Department was searching for a Deputy Assistant Secretary for Native American

Programs. Tribal representatives and Members of this Committee spoke in support

of setting the level for that position to Senior Executive Service (SES). In the spirit

of cooperation, Secretary Martinez has agreed to re-advertise for the position as an

SES.

For fiscal year 2003, the President’s budget proposes a total of $740.5 million, specifically for Native American and Native Hawaiian housing, community and economic development, and education programs. Of that amount, approximately $639

million is for direct, formula allocations under the Native American Housing Assistance and Self-Determination Act’s (NAHASDA) Indian Housing Block Grant Program, $71 million is for grants under the Indian Community Development Block

Grant Program, and $7 million is for the Native American Section 184 and Title

VI loan guarantees. That loan authority will leverage $214 million in loan guarantees.

The Native Hawaiian community will receive, through the Department of Hawaiian Home Lands, $10 million for the Native Hawaiian Housing Block Grant Program and $1 million for the Section 184A Native Hawaiian Home Loan Guarantee

Fund, which will leverage approximately $40 million in loan guarantees.

There is $5.6 million available for training and technical assistance to support

these programs.

Finally, the Department requests $5.4 million to support American Indian, Alaska

Native, and Native Hawaiian-oriented higher education institutions.

Adjustments in the Indian Housing Block Grant (IHBG) program have been made

to allow for more funds to be available for tribal use. The fiscal year 2003 budget

includes $646.6 million for the IHBG program. Although this is a decrease of $2 million from fiscal year 2002, reducing set-asides will actually allow for a $6.4 million

increase in grant dollars available to tribes.

The decreases in set-asides are from the Training and Technical Assistance category, Title VI Program, and Working Capital Fund.
265

The Training and Technical Assistance component of this program has been re- duced to $3 million, down from $5 million the previous year. This action was taken

in recognition that several years have passed since implementation of this program,

and most tribes have been provided with the initial and in-depth training and technical assistance necessary to implement such a new and sweeping change in the

way we do business. Training and Technical Assistance remains a critical component of the program, and we propose that a portion of it be accomplished in partnership with the National American Indian Housing Council.

The President’s Budget includes a $2.2-million set-aside from the IHBG Program

to continue the same level of support as provided in last year’s budget to the National American Indian Housing Council. These funds, as in the past, will be made

available under a contract to the organization in return for their training and technical assistance services to NAHASDA grantees. I would encourage the NAIHC to

work with the Department to ensure that these funds are obligated expeditiously,

and that the training and technical assistance activities occur as soon as is feasible.

In fiscal year 2000, HUD executed a $2-million training and technical assistance

contract with NAIHC. As of December, 2001, less than $500,000 of those funds had

been expended.

The Title VI Tribal Housing Activities Loan Guarantee Fund (Title VI) is also a

set-aside under the IHBG Program. This budget recognizes that until the program

is more fully subscribed, it is more effective to use available funds in the IHBG Program and allocate it by formula directly to IHBG grantees. There is sufficient carryover of unused guarantee authority which, when combined with this year’s budget request, will support anticipated future program needs. This allows $4 million to be

added back into the IHBG formula.

In the Department’s fiscal year 2002 IHBG appropriation, not less than $3 million

was allocated to the Working Capital Fund for internal information technology improvements. In an attempt to better prorate the amount required from each program it was determined that the amount allocated from the fiscal year 2003 IHBG

account should be reduced to $600,000. This $2.4 million reduction from the fiscal

year 2002 appropriation is included in a direct appropriation to the Working Capital

Fund.

Last year, the Section 184 Indian Housing Loan Guarantee Fund received its first

annual credit subsidy re-estimate, as required by the Credit Reform Act. The re-estimate resulted in a reduced subsidy rate, which tripled loan amounts available for

guarantee when holding Budget Authority constant during fiscal year 2002. The

subsidy rate declined due in part to the low number of defaults. The $1 million reduction in the fiscal year 2003 budget request reflects the impact of that recalculation adjusted by anticipated utilization. The $5 million in fiscal year 2003 provides

to $197.24 million in loan guarantee authority.

The President’s fiscal year 2003 Budget request for the Indian Community Development Block Grant (ICDBG) Program is $72.5 million. This budget will provide an

increase of $2.5 million over the amount appropriated in fiscal year 2002. $1.5 million is allocated to the operation of the Native American Economic Development Access Center (Native eDGE).

Native eDGE, which began as a pilot project within the Department, is now an

interagency initiative linking 18 Federal agencies through a single economic development access center so that tribes, Native Americans, lending institutions, nonprofits, foundations and private businesses can collaborate to promote economic

growth and find innovative solutions to chronic economic development problems in

Indian country. The President’s Budget requests that $1.5 million be set-aside from

the ICDBG allocation to continue support of this award winning and much needed

initiative.

For fiscal year 2003, the Department is requesting $10 million. This budget recognizes the unique housing needs of Native Hawaiian families eligible to reside on the

Hawaiian Home Lands, and the Department is now beginning to meet those needs.

A further acknowledgement is the establishment of a separate program account for

the Native Hawaiian Housing Block Grant Program. It is anticipated that an Interim Regulation implementing the new Native Hawaiian Housing Block Grant Program will be published in the Federal Register within the next 2 months. This action will facilitate immediate distribution of funds and implementation of the program while public comments are being received toward publication of final regulations.

The Budget requests that $1 million be allocated to the Section 184A Native Hawaiian Housing Loan Guarantee Fund. At that level of funding, this new loan guarantee program, modeled after the Section 184 Program, will provide up to $40 million in loan guarantee authority to guarantee market-rate mortgage loans to income-eligible Native Hawaiian families who choose to reside on the Hawaiian Home
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Lands. The Department of Hawaiian Home Lands (DHHL), a State agency, is the

primary program partner. DHHL is the agency responsible for allocation of leasehold interests on the Hawaiian Home Lands. Program procedures and activities will

mirror the Section 184 Program as closely as is appropriate. Until direct-endorsement lenders are approved, the ONAP National Programs Office will work closely

with DHHL and individual borrowers to review, underwrite and issue guarantee

certificates for all loans.

The President’s budget request includes, under the Community Development Fund, $3 million for competitive grants to tribal colleges and universities to provide

resources to build, expand, renovate and equip their facilities, and $2.4 million to

assist Alaska Native and Native Hawaiian serving institutions, as they are defined

under the Higher Education Act, as amended.

Finally, let me state for the record that the President’s budget request for HUD’s Indian housing, community development and education programs supports the

progress being made by tribes in providing housing and housing-related activities

in Indian country.

This concludes my prepared remarks. I would be happy to answer any questions

you may have.

Questions From Senator Ben Nighthorse Campbell

Title VI Tribal Housing Activities Loan Guarantee Fund ‘‘The fiscal year 2003 budget request does not include funds for the title VI loan guarantee program, but I understand that the reason for this is that there is $15

million in unused funds from past years that have been carried over.’’ Question 1: There seems to be a lack of understanding by the tribes and the financial community on how to make the most of the guarantee. How can we increase

the desire to use the loan guarantee?

NOTE: The fiscal year 2003 budget request does contain a $2-million set-aside

from the Indian Housing Block Grant allocation for the Title VI Loan Guarantee

Fund. This amount, divided by the credit subsidy factor of 11.07 percent set by the

Office of Management and Budget, will provide $18 million in loan guarantee authority in fiscal year 2003. Cumulative unused set asides through fiscal year 2002

amount to $27.2 million, resulting in cumulative unused loan guarantee authority

of $246 million. Thus, the $18 million in guarantee authority, when added to cumulative carryover guarantee authority, results in $264 million of available Title VI

loan guarantee authority.

Answer 1: The staff of the Office of Native American Programs (ONAP), Office of

Loan Guarantee is partnering with Federal Home Loan Banks, Federal Reserve

Banks and State Housing Finance Agencies to increase awareness of the program

among lenders. Presentations are also being made to tribal advocates at regional

housing authority and other Native American informational meetings. Our website

now features ‘‘success stories’’ regarding affordable tribal housing projects assisted

with title VI loan guarantees. As tribes become more familiar with the program, we

expect to see increased usage. Currently, tribes have made HUD aware of potential

loan guarantee transactions that would use $54 million in guarantee authority.

Training and Technical Assistance

Question 2: The HUD training and technical assistance budget is proposed for a reduction to $3 million, and while I understand that many tribes have already received technical assistance, are we seeing an increase in tribal capacity that makes

‘‘Training and Technical Assistance funding’’ unnecessary?

Answer 2: From the inception of the Indian Housing Block Grant (IHBG) program in fiscal year 1998 through fiscal year 2002, a total of $28 million in training and

technical assistance funding has been as appropriated directly to HUD as follows:

fiscal year 1998—$5 million, fiscal year 1999—$6 million, fiscal year 2000—$6 million, fiscal year 2001—$6 million, fiscal year 2002—$5 million. In addition, the National American Indian Housing Council (NAIHC) has received, through either the

Indian Housing Block Grant or the Community Development Fund, $14.9 million to

provide training and technical assistance during that time period. The total amount

of funding available for training and technical assistance through fiscal year 2002

is $42.9 million.

In fiscal year 2000, HUD executed a $2 million training and technical assistance

contract with NAIHC. As of December 2001, less than $500,000 of these funds had

been expended by NAIHC. The Department has emphasized to NAIHC the need for

timely performance under this contract.

The President’s fiscal year 2003 budget requests $7.4 million ($3 million to HUD

and $4.4 million to NAIHC) for these purposes. If enacted at the request level, total
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funding for training and technical assistance since the inception of the Indian Housing Block Grant Program will be $50.3 million.

There is a significant, long-term commitment by the Congress, the Department

and the National American Indian Housing Council to improve each grant recipient’s technical capacity to operate its IHBG program. While many tribes have

reached the point where they no longer need regular technical assistance, this is not

universal.

Regulatory Reform Commission ‘‘In 2000 we enacted ’Regulatory Reform and

Business Development on Indian Lands Authority’ headquartered in the commerce

department. I would very much like you to work with the Commerce Department

and the Interior Department to see that this commission gets off the ground and

can begin to study ways to peel back unproductive regulations.’’

Question 3: Will you work with us to make that happen?

Answer 3: The Department will be pleased to work with the committee and other

Federal agencies on this effort.

Questions from Senator Pete V. Domenici

Rural Housing and Economic Development

Question 1: There is no funding requested for the Rural Housing and Economic

Development Grant program, which has previously been funded at $25 million per

year. Why is the program not being funded this year?

Answer 1: The President’s budget request for Fiscal Year 2002, as well as for fiscal year 2003, did not contain funding for the Rural Housing and Economic Development Program. While there have been some beneficial initiatives funded with these

grants, it is the Administration’s position that this program duplicates numerous

Department of Agriculture rural development programs that have been in existence

for years covering housing, infrastructure and economic development.

Training and Technical Assistance

Question 2: Under the Public and Indian Housing Technical Assistance program,

there is a decrease of $2 million. Are there other opportunities in HUD that Indian

Nations can take advantage of to offset this decrease in funding?

Answer 2: In the 5 years that the Indian Housing Block Grant Program has been

in effect, the Office of Native American Programs has used training and technical

assistance funds to develop long-term solutions to the challenges of providing training and technical assistance to Indian tribes and their tribally designated housing

entities. One example is the number of training courses that are regularly scheduled

in locations throughout Indian country. These courses include NAHASDA Basics, Indian Housing Plan/Annual Performance Reports, Board and Tribal Roles and Responsibilities, Environmental Review, Self-Monitoring, Construction Contract Management, Financial Management, and Basic and Advanced Financial Leveraging.

Course locations include Oklahoma City, Portland, OR, Phoenix, Seattle, Boise, ID,

Minneapolis and Anchorage. The cost to repeat these courses, as necessary, is significantly lower after initial development.

In addition, advanced technology now allows for the presentation of training without the burden of travel costs. Using pre-prepared and distributed slides and other

visual aids at training sites with telephone connectivity, the trainer no longer has

to be onsite to provide quality training. Conferencing allows multiple locations to

receive training in this manner without incurring travel costs for either the trainer

or the tribal housing staff.

T2Section 184 Program

Question 3: Why is there a decrease of $1 million in the Indian Housing Loan

Guarantee fund?

Answer 3: There is a substantial amount of unused carryover appropriations from

previous fiscal years. This results in cumulative current uncommitted loan guarantee authority of over $ 506 million. A decrease in the subsidy factor (which is set

by OMB) in fiscal year 2002 and again applicable in fiscal year 2003 tripled the dollar amount of loans that can be guaranteed in each of those years. A $5 million appropriation appears adequate for near-term budget cycles given the amount of carryover loan guarantee authority available.

Question 4: Regarding the NATIVE eDGE initiative, how is the money spent?

What are some of the successes of NATIVE eDGE?

Answer 4:

How is the money spent?
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Native eDGE began as a Federal interagency initiative to develop a one-stop-shop

for economic development assistance to American Indian and Alaska Native organizations and individuals. To date, Native eDGE has not received any funding from

Congress or the other 17 Federal agency partners. The initiative was started as a

pilot project with minimal use of HUD funds. Since launch, the cost of HUD staff

has been HUD’s contribution to the interagency partnership.

Native eDGE can be a true catalyst for the creation of sustainable economic development in Indian country.

Approximately $1 million of the fiscal year 2003 appropriation is needed for web

site improvements so that clients can be served more efficiently and effectively. Approximately $500,000 of the fiscal year 2003 appropriation is needed for training to

provide regional workshops for tribes and individuals on how to create businesses;

start tribal career, educational, and economic development programs; and create opportunities for youth using Native eDGE as a tool.

T2How successful is Native eDGE?

Since Native eDGE began in April of 2000, over 40,000 individuals have visited

the web site, over 7,000 publications have been ordered, and over 2,000 requests for

assistance have come in through the Technical Assistance Call Center. Over 800 Indian economic development projects are registered in the Native eDGE eLab portion

of the web site. These projects continue to receive ongoing technical assistance from

the Native eDGE staff.

Institutional Successes

Overall, Native eDGE improves the effective and efficient delivery of Federal services through coordination with 170 Federal program offices, approximately 60 educational organizations, and over 50 grassroots entities. A major objective of Native

eDGE is the promotion of collaborative efforts between Federal agencies, lenders,

foundations, and the private sector. Through these collaborative approaches the limited resources of all Federal entities can be combined for maximum impact for Native Americans and Alaska Natives. This is a unique service provided by Native

eDGE that is not available from any other Federal or non-governmental organization.

Native eDGE improves the effectiveness of outreach to client populations through

the provision of one-stop access to information on Federal, NGO, and private sector

resources. Native eDGE provides efficient service to client populations through an

electronic medium 24 hours per day, 7 days per week. Finally, Native eDGE provides full customer service through regular follow-up and on-going technical assistance.

Individual Successes

This program has enabled Native Americans to more efficiently navigate through

the complexity of Federal Government programs by providing a single access point

for economic development support. Instead of having to invest significant amounts

of time searching through numerous agencies, Native eDGE provides a single access

point to explore an extremely wide range of options and opportunities that cross

multiple organizations. Native eDGE provides this access point through a call center, web site, and publications clearinghouse.

Native eDGE provides Native American businesses with one-stop access to economic development resources, which saves search time and energy. It also enables

businesses or individuals to collaborate with economic development experts in a virtual workspace environment. For example, Native eDGE’s economic development

specialists review and comment on the projects registered by Native Americans

using a web-based internet tool as a means of helping clients improve their projects.

Examples of how the project has benefited a specific individual, enterprise

or organization

‘‘Personally I have recommended Native eDGE to others. If I did not have access

to the Native eDGE program, I would have had to contact multiple resources for

information, and would not have known about other possible funding sources.’’—

Larry Rodgers, Chairman, Four Corners Enterprise Community Board of Directors.

‘‘I was interested in opening up a Subway sandwich shop—Native eDGE pointed

me in the right direction for applying for small business loans for Native Americans.

Although, in the end, I received funding from the private sector, rather than

through a small business loan, Native eDGE was extremely helpful in providing information about different sources of funding. I’m glad that kind of resource for Native Americans exists. ‘‘—Meredith Long, Subway Owner in Kansas City, Missouri.

‘‘Through using the Native eDGE web site, I found out about resources for potential funding on business and economic development projects that I would not have
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thought of otherwise. What I liked best about Native eDGE was the ease of use,

and not having to make time-consuming phone calls or searches through pages of

potential opportunities. The time saved in finding potential grants is invaluable.

Even when some of the auto-generated responses were not directly relevant to my

particular needs, they gave me ideas for other resources and options to explore.’’— Kelly Lammon, Central Council of Tlingit and Haida Indian Tribes of Alaska

PREPARED STATEMENT OF GREG SARRIS, CHAIRPERSON, FEDERATED INDIANS OF

GRATON RANCHERIA

Chairman Inouye, Vice Chairman Campbell and members of the committee, my

name is Greg Sarris, tribal chairperson of the Federated Indians of Graton

Rancheria. Federal recognition was restored to Graton Rancheria by Title XIV of

Public Law 106–568, the Omnibus Indian Advancement Act, an important piece of

legislation enacted with your help on December 27, 2000. In fiscal year 2002, the

Department of the Interior budget contained zero, I repeat zero, funds for Graton

Rancheria under the New Tribes Program, despite repeated letters from Graton

Rancheria to the Secretary of the Interior and Assistant Secretary-Indian Affairs

sent before the fiscal year 2002 budget was enacted.

While we have not yet seen the detailed line items for the fiscal year 2003 Indian

Affairs budget, we are very concerned about the potential for the same thing to happen in this budget cycle and want to be proactive. The Tribe also received zero funds

in response to its request for one-time capital startup costs (separate from New

Tribes Program) and did not even receive a written reply to its formal resolution

to the Bureau. The lack of funding is a major obstacle to developing effective governmental systems for the tribe. We have opened a tribal office primarily with non-Federal funds that come from other tribes in California and with donated, used furniture. We have no ability to hire an administrator and only limited ability to respond to the needs of tribal members. We cannot even plan basic next steps because

of the uncertainty about future funding.

The tribe is certainly grateful to have its Federal recognition back and wishes to

warmly thank the committee members who made that possible. However, at the

same time, we need to look forward and would appreciate the Committee’s support

in resolving this funding dilemma. If funding is provided in fiscal year 2003, it

should be considered the Tribe’s first year of the 3-year period for new tribes in the

New Tribes Program. We will continue to monitor closely the situation and voice

our concerns as necessary.

A separate funding issue relates to Indian Health Service funding and preparation of the Tribe’s base roll, as required under P.L. 106–568. The Tribe to date has

had to expend an enormous amount of time on enrollment issues because the Bureau denied 330 of 772 individual applicants for the base roll and would not accept

the tribe’s roll of documented members at the outset. Many persons have unfortunately not been able to file appeals and the Tribe has minimal resources to help.

The number of members on the base roll is critical for Indian Health Service funding.

While the tribe does not have the resources to personally attend the hearing, we

would be happy to respond quickly to any questions or requests for additional information. Thank you for your consideration of this testimony. Any assistance you can

provide would be greatly appreciated.

PREPARED STATEMENT OF MICHAEL H. TRUJILLO, M.D., DIRECTOR OF THE INDIAN

HEALTH SERVICE

Mr. Chairman and members of the committee.

Good morning. I am, Dr. Michael H. Trujillo, Director of the Indian Health Service [IHS]. Today I am accompanied by Michel E. Lincoln, deputy and Gary Hartz,

acting director of Office of Public Health. We are pleased to have this opportunity

to testify on the fiscal year 2003 President’s budget request for the Indian Health

Service.

The IHS has the responsibility for the delivery of health services to federally recognized American Indians and Alaska Natives [AI/AN’s] through a system of IHS,

tribal, and urban [I/T/U] operated facilities and programs based on treaties, judicial

determinations, and acts of Congress. In carrying out our statutory responsibility

to provide health care services to Indian tribes in accordance with Federal statutes

or treaties, we have taken it as our mission to raise the physical, mental, social,

and spiritual health of American Indians and Alaska Natives to the highest level,

in partnership with the population we serve. The agency goal is to assure that com-
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prehensive, culturally acceptable personal and public health services are available

and accessible to the service population. The mission and goal are addressed

through four agency strategic objectives, which are to: No. 1, improve health status;

No. 2, provide health services; No. 3, assure partnerships and consultation with

IHS, tribal, and urban programs; and No. 4, perform core functions and advocacy.

For the 5th year now, development of the health and budget priorities supporting

the IHS budget request originated at the health services delivery level and with

tribal leadership. As partners with the IHS in delivering needed health care to AI/

AN’s, tribal and urban Indian health programs participate in formulating the budget request and annual performance plan. The combined expertise of the IHS, tribal,

and urban Indian health program health providers, administrators, technicians, and

elected officials, as well as the public health professionals at the area and headquarters offices, has defined health care funding needs for AI/AN people. Improving

the health of the AI/AN population overall, and providing health care to individuals

in that population, are important and challenging IHS goals. Comparing the 1996– 98 Indian [IHS Service Area] age adjusted death rates with the U.S All Races population in 1997, the death rates in the AI/AN population is 6 times greater for alcoholism, 4 times greater for tuberculosis, times greater for diabetes, and 2 times

greater for unintentional injuries.

3 The fiscal year 2003 President’s Budget request and performance plan represents a critical investment in improving the delivery of health care to the American Indian and Alaska Native population. The President proposes an increase of $60.027 million to the IHS budget in fiscal

year 2003 above the fiscal year 2002 appropriation. This request provides an additional $65.807 million for current service items including staffing for newly completed health care facilities, $16.351 million in program increases for Services, and

$1 million in program increases for Facilities and Environmental Health. In addition, the increases include an offset of $23.131 million for administrative and management reforms and one-time facilities projects and construction funds. These proposals result in an overall net increase of $60.027 million.

In support of the President’s Management Agenda and the Secretary’s Workforce

Restructuring Plan, the IHS will streamline its general administrative and management staff at all organizational levels and institute cost controls on administrative

support systems. Along with other DHHS agencies to increase administrative effectiveness, the IHS will transfer its public affairs, legislative, and human resources

staff, functions, and funding to the Office of the Secretary in fiscal year 2003. During fiscal year 2003, the IHS will prepare to move facilities 4 construction, management and maintenance staff, functions, and funding to the Office of the Secretary

in fiscal year 2004.

Further, the President’s fiscal year 2003 budget reflects the IHS’s full share of

the accruing cost of retirement benefits for current civil service and Public Health

Service commissioned personnel. These cost amounts for fiscal year 2003 are shown

as $60,671 million in services, $7.904 million in facilities, and $8.873 million in collections for a total accrual cost of $77.448 million. These costs are also shown comparably for fiscal year 2001 and fiscal year 2002.

These investments will continue to improve the IHS, tribal, and Urban Indian

Health Programs’ capacity and infrastructure to provide access to high quality primary and secondary medical services, and begin to slow down recent declines in certain health status indicators.

From a policy perspective, this budget is based on both new and longstanding

Federal policy and commitment for improving health status by assuring the availability of basic health care services for members of federally recognized Indian

tribes. The request supports the following three policy initiatives:

• HHS’ effort to ensure the best health, and best health care services possible,

without regard to race, ethnicity or other invidiously discriminatory criteria,

• proposed Healthy People 2010 and its goal of achieving equivalent and improved health status for all Americans over the next decade,

• DHHS Strategic Plan with goals to reduce major threats to health and productivity of all Americans; improve the economic and social well-being of individuals and families, and communities in the United States; improve access to

health services and ensure the integrity of the Nation’s health entitlement and

safety net program; improve the quality of health care and human services; and

improve public health systems.

The Indian Health Care Improvement Act and other Federal statutes make clear

that the U.S. Government’s obligation under Federal statutes and treaties includes

providing health care services efficiently and effectively to Indians and Indian

tribes.
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The primary policy basis for this budget request is to deliver efficiently and effectively health care services to the AI/AN population to substantially improve the

health of members of that population. Consistent effort will be required over the

long 6 term to improve the health of members of the AI/AN population, and such

long-term consistent effort should lead us to the day when the health statistics of

the AI/AN population do not differ from those of the U.S. population as a whole.

The Administration takes seriously and is fully committed to honoring its obligations to American Indians and Alaska Natives under statutes and treaties to provide effective health care services.

A major priority in the budget proposal is to restore access to basic health services. The IHS has demonstrated the ability to maximize and utilize available resources to provide services to improve the health status of AI/AN people. However,

the Indian Health Care system continues to face competing priorities, escalating

costs, and an increase in patient demand for more acute and urgent care treatment.

Thus, to address continuing access to essential individual and community health

services, the Area IHS, Tribal, and urban Indian programs identified funding of personnel-related costs and increases associated with current services items as their

first priority for budget increases for fiscal year 2003. In an effort to maintain the

current level of services, the budget request includes $26.812 million for Federal pay

cost increases and $19.758 million for tribal pay costs increases; $16.737 million to

fund the staffing and operative costs of those facilities that will open in fiscal year

2003 or have recently opened; and $2.5 million increase for Contract Support Costs.

The ongoing replacement of outdated clinics and hospitals is an essential component of supporting access to services and improving health status. In the long run,

this assures there are functional facilities, medical equipment, and staff for the effective and efficient provision of health services. As you know, the average age of

IHS facilities is 32 years. The fiscal year 2003 budget includes $72 million for health

care facility construction to be used for replacement of existing health care facilities.

This amount will fully fund construction of the quarters at Fort Defiance, Arizona;

the final phase construction of the hospital at Winnebago, Nebraska; and the final

phase of the construction of health centers at Pawnee, Oklahoma, and St. Paul,

Alaska; the continued construction of health centers at Pinon, Arizona, and Red

Mesa, Arizona.

Also critical is the provision of adequate contract support costs necessary to support the health services provided by tribal health programs. These requested funds

are necessary for tribal communities to assure that there are utilities, training, clerical staff, administrative and financial services needed to operate health programs.

Without this contract support funding, these support services are either not available or must be funded from resources that would otherwise fund health service activities.

This investment is consistent with the Administration’s commitment to expand

tribal participation in the management of federally funded programs, and reinforces

the principles of the Indian Self-Determination Act.

The fiscal year 2003 budget includes an increase of $2.5 million over the fiscal

year 2002 enacted level for contract support costs (CSC). The increase is necessary

to provide CSC funding for new and expanded tribal programs to be contracted in

fiscal year 2003. The $2.5 million increase will first be used to provide CSC for new

assumptions of IHS programs under self-determination agreements. To the extent

the $2.5 million is not needed for new assumptions, it will be used to increase contract support cost funding for existing contracts.

The requests that I have just described provide a continued investment required

to maintain and support the IHS, tribal, and urban Indian public health system to

provide access to high quality medical and preventive services as a means of improving health status. The following proposals are intended to strengthen health improvements among the Indian health care components.

Proposed increases of $7.351 million for contract health services, $1.5 million for

the tribal epidemiology centers, $4.150 million for health care professions, $3.0 million for information technology, $1.0 million for maintenance and improvement, and

$850,000 for HIPAA privacy regulations are also included in the funding request.

The health status that the I/T/Us must address is formidable, particularly in

terms of death rates. Comparing the 1996–98 Indian age-adjusted death rates with

the U.S. all races population in 1997 reveals greater death rates in the AI/AN population for alcoholism, tuberculosis, diabetes, unintentional injuries, suicide, pneumonia and influenza, homicide, gastrointestinal disease, infant mortality, and heart

disease. Even more alarming is recent data that indicates the mortality disparities

for AI/AN people are actually worsening.

Given these formidable challenges, the IHS is pleased to present this budget request for fiscal year 2003 as one that will improve access to basic health services
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and address the multiple health issues affecting AI/AN people. The request and associated performance plan represent a cost-effective public health approach to assure improvements in the health of AI/AN people. The request reflects the continued

Federal commitment to enhance the IHS, tribal, and urban Indian health system

so that we can continue to make significant improvements in the health status of

American Indian and Alaska Native people.

Thank you for this opportunity to discuss the fiscal year 2003 President’s budget

request for the IHS. We are pleased to answer any questions that you may have.

PREPARED STATEMENT OF THE NATIONAL CONGRESS OF AMERICAN INDIANS

On behalf of NCAI’s more than 200 member tribal nations, we are pleased to have

the opportunity to present written testimony on the President’s fiscal year 2003

budget request for Indian programs.

The tragic events of September 11 brought forth the strength and the determination, of our Nation to survive in the face of adversity. It is this same spirit that

has carried Indian country through years of annihilation and termination. It is this

same spirit that has propelled Indian Nations forward into an era of self-determination. And it is in this same sprit of resolve that Indian Nations come before Congress to talk about honoring the Federal Government’s treaty obligations and trust

responsibilities throughout the fiscal year 2003 budget process. On February 4, President Bush proposed a $2.13-trillion budget for fiscal year

2003 that included largely level funding for Indian programs, continuing the trend

of consistent declines in Federal per capita spending for Indians compared to per

capita expenditures for the population at large. This trend demonstrates the abject

failure of the Federal Government to commit the serious resources needed to fully

honor its trust commitment to Indian tribes.

As you know, the Federal trust responsibility represents the legal obligation made

by the U.S. Government to Indian tribes when our lands were ceded to the United

States. This obligation is codified in numerous treaties, statutes, presidential directives, judicial opinions, and international doctrines. It can be divided into three general areas protection of Indian trust lands; protection of tribal self-governance; and

provision of basic social, medical, and educational services for tribal members.

NCAI realizes Congress must make difficult budget choices this year. As elected

officials, tribal leaders certainly understand the competing priorities that you must

weigh over the coming months. However, the fact that the Federal Government has

a solemn responsibility to address the serious needs facing Indian country remains

unchanged, whatever the economic climate. We at NCAI urge you to make a strong,

across-the-board commitment to meeting the Federal trust obligation by fully funding those programs that are vital to the creation of vibrant Indian Nations. Such

a commitment, coupled with continued efforts to strengthen tribal governments and

to clarify the government-to-government relationship, truly will make a difference

in helping us to create stable, diversified, and healthy economies in Indian country.

NCAI’s written statement focuses on the key areas of concern surrounding the

President’s budget request of course, there are numerous other Federal programs

and initiatives that are important to American Indians and Alaska Natives. Attached is an agency-by-agency breakdown and NCAI resolutions detailing key programs that benefit Indian Nations. NCAI urges Congress to support each of these

programs at the highest possible funding level as the budget and appropriations

process moves forward.

Bureau of Indian Affairs/Office of Special Trustee

The President has requested a $22.9-million increase for the Bureau of Indian Affairs, from $2.25 billion to $2.27 billion. The funding increase is primarily dedicated

to trust management activities. Other key areas of the BIA budget, such as Tribal

Priority Allocations, public safety, and economic development, remain deeply underfunded.

Tribal Priority Allocations provide tribes with the resources for governmental

services at the local level. Because we are able to prioritize TPA funds according

to our unique needs and circumstances, providing adequate TPA resources is one

of the most important things the Federal Government can do to further the goals

of tribal self-governance in a practical way. Unfortunately, the budget requests only

a $23.4-million increase to this account, with nearly $18 million of that going toward trust-related activities.

The Census Bureau’s Poverty in the United States for 2000 showed that American

Indians and Alaska Natives remain at the bottom of the economic ladder—with 25.9

percent of our population falling below the poverty line. This compares to an 11.9-

percent poverty rate for all races combined. Simply put, tribal governments simply
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1Department of Health and Human Services, Centers for Disease Control, Trends in Racial

and Ethnic-Specific Rates for the Health Status Indicators: United States, 1990–98, January,

2002.

cannot continue to provide essential government services to our growing—and disproportionately poor—population without a substantial increase in our TPA funds.

As stated earlier, the budget request includes a significant initiative to increase

funding for trust management within the BIA and the Office of Special Trustee.

Within the BIA, $153 million—a $35-million increase is included for trust operations

and services at the headquarters, regional, and tribal levels. The Office of Special

Trustee would receive a 44-percent increase—to $160.6 million—which is partially offset by a $3-million cut to the Indian Land Consolidation Account.

NCAI is concerned that a large portion of the requested increase for trust management likely would go toward implementing the new Bureau of Indian Trust Assets Management that is strongly opposed by tribes. NCAI believes that a large

funding increase is key to reversing the hundreds of years of gross mismanagement

that continues to plague tribal and Indian trust accounts. As Secretary Norton herself has pointed out, it will cost ‘‘hundreds of millions’’ of dollars to remedy the problem. However, any such increases must be targeted Testimony of NCAI

President’s Budget Request for fiscal year 2002 March 7, 2002 Page 4 of 8 for

workable, well-planned reform initiatives developed in close consultation with tribes

and individual beneficiaries.

Finally, one other area of the BIA budget—education—deserves special mention.

The budget request includes an extremely troublesome proposal that would authorize the privatization of the 64 schools directly operated by the Bureau of Indian Affairs, unless tribes decide to operate these schools under contracts or grants. Of

course, tribal operation of schools is a fundamental principal of self-determination,

and NCAI firmly supports the right of tribes to privatize schools if they so desire.

However, the budget request fails to provide adequate funding to cover the costs

of tribal administration of BIA-funded schools, especially for the lowest-performing

ones slated for transfer. The small increase in funding proposed for Administrative

Cost Grants does not come close to addressing the drastic shortfalls in this account,

which is currently funded at less than 80 percent of the level required under Federal law. Additional school conversions to tribal operation would decrease the slice

of the already too-small pie going to each school even more. Likewise, the $2 million

increase proposed for student transportation is completely inadequate compared to

the $21.5 million needed just to bring tribally operated schools up to a funding level

that equals the national average of 5 years ago.

Indian Health Service

The budget request includes $2.9 billion for the Indian Health Service, a $60-million increase over the current funding level, but a de facto decrease given the absorption requirements proposed under the President’s request. Of this total, $2.5 billion is proposed for Indian health services. For facilities, $370.5 million is proposed—an increase of less than $1 million.

Because most of the increases are targeted for mandatory pay-cost adjustments

and staffing at new facilities, the budget request falls short of allowing the IHS to

break even with fiscal year 2002 funding levels once the new absorption requirements under the President’s budget are accounted for. When measured in constant

dollars, per capita spending for health care in the IHS service population is actually

lower today than it was in 1977. Since 1993, funding has dropped below the rate

of inflation and the 27 percent hike in the IHS service population in the 1990’s.

Indian country is all-too-familiar with the disproportionate impact that diseases

such as diabetes, heart disease, and cancer have in American Indian and Alaska

Native communities. In January, the Centers for Disease Control released a study1

that found that, between 1990 and 1998, the lung cancer death rate for American

Indians and Alaska Natives increased by 28 percent and the percent of low birthweight infants increased by 11 percent. The study also found that American Indians

and Alaska Natives do not appear to have experienced the same improvements in

the suicide, breast cancer, and stroke death rates as other racial/ethnic groups.

To help address these health disparities in a meaningful way, the IHS Level-ofNeed Funding Workgroup has identified an $18-billion needs-based budget for the

IHS, including a non-recurring $8.7 billion facilities request and $10 billion to fully

fund the health needs of American Indians and Alaska Natives.

A 10-year phase-in of the $18 billion needs-based budget can be achieved through

a several years of appropriations increases. If a first year increase of $2.6 billion

were appropriated [a 112-percent increase], the following years’ increases would decline to 20 percent in year 5 and 10 percent in year 10. The first year increase
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2 U.S. Department of Justice, Office of Justice Programs, National Institute of Justice, Policing

on American Indian Reservations, September 2001.

would be substantially more to help offset the more than $2 billion lost to inflation

over the past 8 years.

This type of major investment would account for the real revenue losses due to

inflation and population growth, create long-term savings to taxpayers, and eliminate the vast health disparities that exist between American Indians and Alaska

Natives and the general U.S. population.

Other Key Issues

Public Safety

More than 200 police departments, ranging from tiny departments with only two

or three officers to those with more than 200 officers, help to maintain public safety

in Indian Country. According to a recent Justice Department2 study, the typical Indian country police department has no more than three and as few as one officer

patrolling an area the size of Delaware.

The same study found that inadequate funding is ‘‘an important obstacle to good

policing in Indian country.’’ According to DOJ, the appropriate police coverage comparison may be between tribal departments and communities with similar crime

problems. Because the violent crime rate in Indian country is more than double the

national average, we should compare our police coverage with large urban areas

with high violent crime rates. According to the Bureau of Justice Statistics, cities

like Baltimore, Detroit, and Washington have high police-to-citizen ratios of 3.9 to

6.6 officers per 1,000 residents. On the other hand, virtually no tribal police department has more than 2 officers per 1,000 residents.

Given that the Justice Department itself just published a study that justifies the

need to increase resources for Indian country law enforcement, it is astounding to

see that our law enforcement programs actually took a $40-million direct hit in the

fiscal year 2003 budget request. The budget would eliminate all $35 million in tribal

jail construction funding and would cut $5 million in tribal law enforcement personnel funds. We strongly oppose these cuts, and request an increase to the FY 2002

funding levels for Indian country law enforcement programs.

Housing

According to statistics provided the by the National American Indian Housing

Council, 40 percent of the homes in tribal communities are overcrowded and have

serious physical deficiencies. The comparable national average is 5.9 percent, almost

six times lower.

These types of conditions have a very real and detrimental impact. Respiratory

illness, skin conditions, head lice, sleep deprivation that affects schooling, and a lack

of privacy that sometimes leads to child physical and sexual abuse can all be traced

back to the housing crisis that plagues some of our reservations.

In the face of the widely reported housing deficiencies in Indian country, I am

sure that you were as surprised as us to see that the fiscal year 2003 budget request

actually cuts several programs authorized under the Native American Housing Assistance and Self-Determination Act [NAHASDA]. The President’s proposal reduces

the Indian Housing Block Grant Program by $2 million, to $647 million, and slashes

the title VI loan guarantee program by two-thirds.

The FY 2003 request is far below the $1.1 billion base funding determined by the

National American Indian Housing Council [NAIHC] as a minimum to begin addressing the housing shortage in American Indian communities. NCAI supports the

NAIHC-recommended funding level and calls upon Congress to reject the cuts proposed by the Administration.

Transportation Indian Reservation Roads [IRR] make up 2.63 percent of all existing roads in the Federal-aid highway system, but historically they have received less

than 1 percent of all Federal highway dollars. On average, only $500 per mile—and

in some cases, as little as $80 per mile—is available for maintenance. In comparison, an average of $2,200 per mile is spent maintaining other Federal roads, and

an average of $2,500 to $4,000 per mile is spent by States.

Recognizing the urgent need to improve the road conditions in Indian country,

Congress last year approved a fiscal year 2002 Transportation Appropriations bill

that provided funds to offset the obligation limitation on the IRR and thus resulted

in a final funding level of approximately $275 million, the full authorization level.

The budget request for the Department of Transportation eliminates the additional IRR funding contained in the fiscal year 2002 appropriation, which means

that we would see a funding level of approximately $240 million.
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Indian Reservation Roads are among the worst maintained in the United States

and often must be shut down during the winter months or in rainy weather. This

type of unreliable transportation infrastructure hurts our ability to attract businesses, provide emergency services, and bus our children safely to school. The IRR

program needs an increase, not a decrease, and we urge you to support an appropriation to offset any negative effect of the obligation limitation on its authorized

level of $275 million.

Community and Economic Development Programs Members of the Senate Indian

Affairs Committee know the critical need to promote community development and

economic diversification in our tribal communities.

Many economic development programs that assist tribes would be cut or eliminated in the budget. The request for the Small Business Administration would

eliminate One Stop Capital Shops, Micro-Loan Technical Assistance, New Markets

Venture Capital, and BusinessLINC. The Administration also failed to request any

funding whatsoever to establish the Office of Native American Business Development, as authorized in the Native American Business Development, Trade Promotion, and Tourism Act of 2000.

Furthermore, programs designed to help tribes close the ‘‘dial-tone divide’’ and improve the telecommunications infrastructures in their communities are eliminated

outright or severely reduced in the President’s budget. For example, the request for

the Commerce Department would eliminate the Technology Opportunities Program—TOP—which in fiscal year 2001 provided over $4 million in competitive

grants to tribes and tribal organizations for the purpose of expanding technology in

their communities.

Reducing or eliminating economic development tools for Indian country is unthinkable in the face of the compelling needs that exist. NCAI has approved numerous resolutions calling for increased support of economic development programs

within the Small Business Administration and Department of Commerce, and we

urge that these programs and others that are designed to promote tribal community

development be fully funded.

Conclusion

Thank you for this opportunity to present written testimony regarding the President’s fiscal year 2003 budget request for Indian programs. The National Congress

of American Indians calls upon Congress to fulfill the Federal Government’s fiduciary duty to American Indians and Alaska Native people. This responsibility should

never be compromised or diminished because of any political agenda or budget cut

scenario. Tribes throughout the Nation relinquished their lands and in return received a trust obligation, and we ask that the Congress to maintain this solemn obligation to Indian Country and continue to assist tribal governments as we build

strong, diverse, and healthy nations for our people.
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Æ
(360)

FISCAL YEAR 2003 BUDGET

THURSDAY, MARCH 14, 2002

U.S. SENATE, COMMITTEE ON INDIAN AFFAIRS, Washington, DC.

The committee met, pursuant to notice, at 10 a.m. in room 485,

Russell Senate Office Building, Hon. Daniel Inouye (chairman of

the committee) presiding.

Present: Senators Inouye, Campbell, Conrad, Dorgan, and

Domenici.

STATEMENT OF HON. DANIEL K. INOUYE, U.S. SENATOR FROM

HAWAII, CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

The CHAIRMAN. The committee meets this morning for the third

in the series of hearings on the President’s budget request for Indian programs for fiscal year 2003. Today, we will examine the

budget requests for the Bureau of Indian Affairs and the Department of the Interior for the National Indian Gaming Commission

and for the Environmental Protection Agency.

One of the proposals set forth in the President’s budget is for the

privatization of schools that are currently administered by BIA.

Under that proposal, the operation of BIA schools would be offered

to the respective tribal governments; and if they opted not to assume the responsibility, the Bureau would enter into a contract

with a private organization to run these schools.

Naturally, when one considers the fact that we are talking about

placing our most precious resource of all, our children, in the hands

of private educational organizations for whom there is no rating

system or accrediting body, there will be questions.

There are some cost considerations driving this proposal; or put

another way, will it cost the Government less to contract with private organizations, to operate Indian schools? Has there been such

a comparative assessment of costs? Has there been any assessment

of the performance of those schools that are now tribally operated,

as compared to the schools administered by the Bureau?

How can we assure parents that the quality of education that is

provided by private organizations will be the same or better than

that which currently exists? What role will parents and school

boards play, and what relationship will they have with these private entities?

What accountability will there be to parents and school boards,

or will the private organizations only accountable to a contracting

officer in Washington?
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We are told that these educational organizations expect performance bonuses and incentives. Are such bonuses or incentives going

to be provided to tribal governments that elect to take over the operation of the schools?

These are just a few of the questions that Indian country is asking about this proposal. So we welcome the witnesses today, and

look forward to an ongoing dialog on these and other matters.

Now it is my pleasure to call upon the vice chairman of the committee.

STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM COLORADO, VICE CHAIRMAN, COMMITTEE ON

INDIAN AFFAIRS

Senator CAMPBELL. Thank you, Mr. Chairman.

Good morning and thank you for holding this hearing. It is nice

to see our friends Neal McCaleb, Montie Deer, and Diane Regas

from the EPA. I welcome you to the committee.

It certainly must be noted that the fiscal year 2003 budget request must be viewed against the backdrop of the war on terror

and homeland security. Clearly, that is where a lot of the focus of

the Congress has been the last few months, as everyone knows.

Nevertheless, the needs are great in Indian communities. The request includes a $20-million overall increase for BIA programs. I am very happy to see more attention on education and

economic development for the bureau. Increases are proposed of

$70 million for trust activities. We do not have the Task Force recommendations yet, so I am not quite sure how that amount of

money is going to fit in with what we may have to do to help

straighten out the Trust Fund problem.

I know, in the past, we have put a lot of money in that, and I

want to make sure that we are careful that we do not just throw

more good money after bad. The TPA will see a $24-million increase, I think that we have to

have an ongoing dialogue about that, because I know that some of

tribes in real need do not get the amount that they would like.

Meanwhile, some of the few very wealthy tribes that are out there

seem to get a bigger percentage.

There will be a $4-million increase for tribal courts. It is probably not enough, but certainly I approve of that. There is also $2.1

million for energy development. I think as we move our energy bill,

and we are dealing with that now on the floor of the U.S. Senate,

as we go into future years, the energy crunch is going to put more

and more interest, I think, on developing energy on Indian lands.

You mentioned the contract support costs increase of $3 million expansion, and I certainly support that, too.

In January, the President signed the No Child Left Behind Act,

which included the Native American Education Improvement Act

that I and the Chairman had worked on. I certainly thank the

President for his request of nearly $293 million for school construction, but note that it is probably still short of the needs.

I believe there are other ways to help get more schools built, like

school bonding, and I hope the Administration considers supporting

that idea. I know I have talked to Neal McCaleb about it, and I

know he thinks it has some real merit.
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On September 28, the GAO reported that in many categories,

BIA schools failed to produce the kind of education that Indian

children need so badly. Let me quote from that report.

The academic performance of many BIA students, as measured by their performance on standardized tests and others measures, is far below the performance of

students in public schools. BIA students also score considerably below the national

average on college admission tests.

We can do better than that.

Of all the 185 BIA schools, Indian tribes already operate 121 of

them through grants. The Bureau operates the remaining 64. The

budget request includes a proposal to bring competition to these

schools by way of a privatization initiative.

I think this may have some merit because all these youngsters

are going to have to go out to the big world and compete, and I do

not think it is ever too early to start learning how do to that. I believe in competition, and I think we need to look at it very carefully.

We also need to ask some questions. Can we provide incentives

so that tribes assume control of the remaining schools at a more

rapid rate? What role would tribal government play in a selection

of private contractors? What experience do the current contractors

have with Indian culture and traditional beliefs of Indian people?

With that, Mr. Chairman, I would ask unanimous consent to put

the rest of my statement in the record, because I know Neal

McCaleb has a very tight schedule. He is going to be over on the

House side very shortly, and thank you.

The CHAIRMAN. Without objection, so ordered.

[Prepared statement of Senator Campbell appears in appendix.]

The CHAIRMAN. Our first witness is Neal A. McCaleb, Assistant

Secretary, Bureau of Indian Affairs, Department of the Interior.

Mr. Secretary, it is always good to have you here, sir.

STATEMENT OF NEAL A. MCCALEB, ASSISTANT SECRETARY,

BUREAU OF INDIAN AFFAIRS, DEPARTMENT OF THE INTERIOR

Mr. MCCALEB. Mr. Chairman, Mr. Vice Chairman, I am delighted to be here and have the opportunity to visit with you about

our budget request for fiscal year 2003.

You are very aware of the sphere of services of the Bureau of Indian Affairs, which services 1.4 million Native Americans in 31 different States, composing 559 tribes. We provide a wide range of

Governmental services that are usually provided by local government such as education, law enforcement and detention, social

services, roads; and peculiarly to the Bureau of Indian Affairs, but

certainly in focus now, is the trust asset resource management activities.

On the roads, I want to point out that that is an off-budget item,

funded through the Federal Highway Trust Funds, which total

about $264 million in fiscal year 2002; but that we maintain 25,000

miles of BIA on-system roads, and an additional 25,000 miles of Indian roads that constitute a total of a little over 50,000 in the Indian reservation road system.

The allocation of our funds is, I think, noteworthy; 90-percent of

all the funds that are appropriated to the Bureau of Indian Affairs
363

are directed to the local level, either for school operations, to the

agencies, or the regional offices.

Fifty-four percent of our entire budget is directed straight to the

tribal organizations themselves, either through Public Law 93–638

or self-governance contracts and compacts, pursuant to the policy

of self-determination contained in Public Law 93–638 and the subsequent titles for that. In terms of actual direct administration,

about 8 percent bureau-wide goes for administrative dollars.

The needs and the demand for services are well known to us all.

With poverty in the 33 percent level and unemployment at 40 percent, they engender a variety of social problems, including alcoholism and violent crime, and other behavioral health problems in the

reservation environment.

Our proposed budget for fiscal year 2003 is $2.3 billion, which is

an incremental increase of approximately $46 million. Of that $46

million, $21.9 million is the congressionally-mandated Civil Service

Retirement System, that is applied directly now to the agency.

There is about $23.1 million in actual accumulative programmatic

increases.

As I indicated, there are other off-budget items, such as the

roads at $264 million; the Wildlands Fire Management System,

which last year was about $20 million; and notably, the Office of

Indian Education Programs, which last year was about $132 million.

The emphasis, as has been indicated in this year’s 2003 proposed

budget, is education, which is funded at $562 million. In addition,

that is an incremental increase of about $18 million. Of that, about

$11.9 million is designated in the budget for the privatization initiative. There is an additional $3 million in new money to fund

seven new FACE schools for early childhood education.

Our construction budget remains high, at $292.7 million. I would

point out that over the last 4 years, or if you go back to fiscal year

1999, the entire construction budget was only $64 million. In fiscal

year 2000, it jumped to $130 million.

For the last 2 fiscal years of 2001 and 2002, it has been in the

$292 million range, and this year, the request is for $292 million,

which is an increase of over 200 percent over the 2000 budget. This

budget remains committed to eliminating the backlog of school replacements that are necessary, and that includes both the school

replacement and the facilities improvements that are necessary;

about $125 million for school replacements, and $164 million for facility improvements and repairs.

As indicated, the tribal priority allocations are emphasized. It is

the next largest aspect of our budget, which is $523 million, or an

incremental increase of about $17 million.

The Trust Enhancement Program has an incremental increase

exclusively for the Bureau of Indian Affairs of about $34 million.

The other additional increase to bring it up to over $70 million is

in the Office of the Special Trustee, but about $34 million is directly in the Bureau of Indian Affairs.

For the first time, we are including an element specifically for

energy development, a little over $2 million. This is the initial

funding for this, and we are requesting it so that we can assist the
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tribes in developing their under-developed and undeveloped energy

resources.

With that, Mr. Chairman and members, I think I will refer the

rest of my written testimony to you for your perusal at your convenience, and answer any questions that you might have.

[Prepared statement of Mr. McCaleb appears in appendix.]

The CHAIRMAN. I thank you very much.

Before I go to questions, Senator Conrad, do you have anything

you would like to say?

STATEMENT OF HON. KENT CONRAD, U.S. SENATOR FROM

NORTH DAKOTA

Senator CONRAD. Thank you very much, Mr. Chairman.

I have just a couple of brief comments.

First of all, I was extraordinarily disappointed that the Administration has cut funding for the tribal colleges. In my experience,

tribal colleges are one of the most positive institutions in Indian

Country. I have seen them change people’s lives.

I do not know how the Administration justifies coming in and cutting tribal colleges by $2 million from what was provided last

year. Now I know, as Budget Committee Chairman, we face tough

choices. But honestly, I cannot think of a worse choice than deciding to cut tribal colleges.

Perhaps even worse, the United Tribes Technical College in my

own State, after being funded by every Administration for the last

20 years, had its funding completely eliminated in this budget. I

really am amazed that the Administration would yank the rug out

from under this school and the more than 500 students that attend

it.

This school does not receive assistance under the tribally-controlled college or the University Assistance Act. Therefore, it is dependent on these BIA funds.

I would love to hear what the explanation is for eliminating the

funding for this institution that is the only inter-tribally controlled,

post-secondary vocational institution in the country. It is the only

one, and you submit a budget that eliminates the funding for it entirely. I await, with great interest, the explanation.

The CHAIRMAN. Senator Dorgan.

STATEMENT OF HON. BYRON L. DORGAN, U.S. SENATOR FROM

NORTH DAKOTA

Senator DORGAN. Mr. Chairman, I cannot say it better, but I can

say it again. My colleague has talked about the United Tribes

Technical College. I was on the campus of the United Tribes Technical College about 2 weeks ago, following the Administration’s recommendation that it not be funded. That is a huge mistake.

As Senator Conrad indicated, Republican and Democratic Administrations for 2 decades have recommended funding for this unique

institution. It is unique in the country in the way it serves Native

Americans from virtually all over America.

I cannot believe that anyone who went to United Tribes and

looked at that curriculum and looked at the results and said, by

the way, this is unworthy. I cannot believe anybody did that. I be-
365

lieve that someone who knew the cost of everything, but the value

of nothing, as the old saying goes, decided just to zero this out.

But I have asked the Administration to send someone there now,

go to the campus, meet with the teachers, meet with the students,

review the curriculum, review what that institution has done for

Native Americans for many years, and then tell us that it is unworthy.

I do not think that will be the case. I think that if someone takes

a look at this and does due diligence, and does what should have

been done before the budget came out, I believe that there will be

a conclusion that this is a very important and worthy institution

to fund.

I am also concerned about the proposed decrease in tribal community colleges. This has been a ray of hope. It allows people with

the connections to their home area for child care and other things,

to be able to access college. Our per-student support is miserably

low even now, but to propose a decrease is just wrong.

If I might, Mr. Chairman, have 1 more minute. I spoke at a tribal college graduation ceremony 1 day. The person with the broadest

smile that day was a woman named Velma, who was getting her

degree.

She had been a janitor, a single mother with four children, cleaning the hallways and cleaning the bathrooms of this college. She

decided she wanted to do something more than that.

The day I showed up, because of our investment and our support,

and because of this tribal college, Velma was able to be a college

graduate that day. That is something no one will ever take away

from her. She did it herself with our help.

It describes the value of tribal colleges, because she was able to

do it in her community, with the support of family, for child care

and other things.

So I want to just implore the Administration to take a new look

at the tribal college recommendation. Cutting that is wrong. It is

just wrong, and especially with respect to United Tribes.

It is inconceivable to me, and I will ask, Mr. Chairman, whether

anyone from the Administration went to United Tribes, and took

a look at that curriculum; and if so, did they find it wanting, and

if so, where and how? My guess is that somebody just took a pencil

and just zeroed it out, and I think that is unforgivable.

The CHAIRMAN. Thank you very much.

Senator Domenici.

STATEMENT OF HON. PETE V. DOMENICI, U.S. SENATOR FROM

NEW MEXICO

Senator DOMENICI. Thank you very much, Mr. Chairman.

I have a series of questions when it comes my turn, but I would

like to make a couple of comments.

Mr. Secretary, first, I want to commend the Administration for

including in the budget this year $292,700,000 for the construction

of new Indian schools.

For years, instead of catching up, we were going backwards in

terms of schools that needed replacement or significant rehabilitation. It was a rather deplorable situation, when the President arrived on the scene here in the White House, to find the condition
366

of the BIA schools. He made a commitment, and I thank you very

much for encouraging him to live up to it.

This means eight Indian schools in the United States, three in

Arizona, two in South Dakota; and South Dakota will have two

schools, the total of which will be over $27 million; one Indian

school in New Mexico, and one major Navajo school, a boarding

school, which has a very, very expensive price tag, but it is going

to be constructed also, at $33 million.

Now all of us on this committee, including as I look around,

every single one, has been on the Floor of the Senate from time to

time, extremely critical of the deplorable condition, the physical

plant-wise condition, of the Indian schools.

I think we had something to do with making the change; but

nonetheless, we have to give the President and you credit for living

up to it. It will make a big difference, and we will soon catch up.

It will take a few more years, but we will.

There are many other things we could talk about that are positive in this budget, and some are negative. Some the President

found that he could not fund, if he was going to live within the

budget that he has come up with.

We will have our turn at those in the processes up here. If we

find them extremely wanting, his decisions, we will make up for it

as we go through the appropriation process.

So if I was the college that has been spoken about by our two

distinguished Senators, I would not be too worried. The Senate has

its opportunity to work its will. From what I can see, some of these

issues will be taken care of, and it will not be terribly expensive.

Thank you very much, Mr. Chairman.

The CHAIRMAN. I thank you very much, Senator.

Mr. Secretary, what is the Bureau’s legal authority to privatize

Bureau-operated schools?

Mr. MCCALEB. Well, I think the Bureau, as the trustee to Native

Americans, has the authority and the obligation to seek the most

effective ways to provide for quality education.

As was pointed out earlier, the BIA has been criticized in the recent General Accounting Office report for the achievement and proficiency levels of BIA-educated students. So the motivation for exploring privatization is to try to expand the kinds of choices that

are available to the local school boards for enhancing the quality

of education and the proficiency of the students.

Privatization has shown some demonstrable success in other

areas that are characterized by poverty and high unemployment.

The objective is to work with the students in the BIA-operated

schools and use privatization on a demonstration project basis, to

measure its effectiveness and success in some of our least high performing; or let me say it another way, our worst low performing

schools, to see if we can, in fact, through their experience, effect

meaningful change.

The CHAIRMAN. The Indian Child Protection and Family Violence

Prevention Act was enacted, as you know, to prevent child molesters and pedophiles from working in BIA schools; because it is common knowledge that these people seem to gravitate to places where

they can have access to children without having to undergo background checks.
367

This act only applies to tribal and Federal employees. Would it

apply to private contractors?

Mr. MCCALEB. We are currently expanding our security measures in a variety of areas within the Bureau of Indian Affairs, to

include not only BIA employees, but also tribal employees in any

privatized contracts.

The CHAIRMAN. Well, under the present law, BIA employees and

tribal members must undergo a background check. My question is,

would the employees of these private institutions be required to undergo background checks?

Mr. MCCALEB. Yes.

The CHAIRMAN. That would be in the contract?

Mr. MCCALEB. Yes.

The CHAIRMAN. This privatization, although it in one glance

would appear to give the Indian tribe a choice, to me, it seems to

present the tribe with an ultimatum. You either contract or grant

the schools, or the Bureau will hire a private entity.

Mr. MCCALEB. I do not think, Mr. Chairman, that it is a mandate in any form or fashion. It does present an additional choice.

I can assure you that no tribal school board will be forced to privatize, if they choose not to; certainly, until there is some demonstration over a period of some years.

The CHAIRMAN. Can they choose to stay with the BIA-operated

school?

Mr. MCCALEB. Yes.

The CHAIRMAN. So you have that choice; it is either contract or

tribe? I thought that was your proposal.

Mr. MCCALEB. Right now, we give the tribes the choices to contract the schools, either through Public Law 93–638 or a grant

basis. That is their choice.

The CHAIRMAN. Under your proposal, the tribe is given a choice.

You either privatize or you do it yourself.

Mr. MCCALEB. Mr. Chairman, I do not think that decision has

been made yet, because we have not gone through the consultation

process with the tribes, which is supposed to begin this next

month. Those are the kinds of things that will be sorted out in the

consultation process with the tribes.

The CHAIRMAN. I am glad you brought up consultation. Have you

consulted the Indian tribes before making this proposal to this

committee?

Mr. MCCALEB. Not in a formal way; no, sir.

The CHAIRMAN. When do you intend to sit with tribal leaders on

this matter?

Mr. MCCALEB. Beginning in the middle of this coming month; we

have organized and scheduled about seven different regional consultation sessions.

The CHAIRMAN. So when the President released his budget request, no Indian Nation had received some notification of consultation.

Mr. MCCALEB. No formal consultation; no, sir.

The CHAIRMAN. Well, I would like to know what the Indian Nations have to say about this before this committee acts upon it. I

think that is the proper way.
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In coming to your decision to privatize schools, was this based

upon some recommendation made by a report, or by a panel of

scholars or something like that; or was it a matter of the budget,

the bottomline?

Mr. MCCALEB. I do not think that the bottomline objective, the

driving objective, is to reduce the cost. We are, of course, hopeful

that that will be a by-product. But the objective is to increase the

proficiency and the performance of our Indian students academically.

We have seen, in some demonstrations right here in Washington,

DC, as an example, where some schools have been privatized, and

had a marked enhancement in their achievement test scores.

The CHAIRMAN. Do you have copies of those reports?

Mr. MCCALEB. I am sure Mr. Mehojah has those reports. Bill

Mehojah, who is the Director of our Office of Indian Education Programs, is here with me today.

The CHAIRMAN. Mr. Mehojah, can you tell us on what document

the Department based its decision to privatize? Is it just the Washington, DC schools?

Mr. MEHOJAH. No, sir; we took a look at the 1999 and 2000

school achievement levels of our schools. There were 106 of those

schools that were 50 percent or more partially proficient. That

means that there are three levels. There is partially proficient, proficient, and advanced.

The CHAIRMAN. There were BIA-operated schools?

Mr. MEHOJAH. These were BIA-funded schools. In that, of course,

were included the BIA-operated schools; the 64 BIA-operated

schools that we still have.

To answer your question, yes, we do have documentation to show

how some of these private companies are influencing the achievement levels of the schools that they have contracted with.

The CHAIRMAN. And based upon that, you recommended this.

Mr. MEHOJAH. Based on that, we decided that we needed to look

at all options to improve achievement levels in our school.

The CHAIRMAN. But in the process, you did not discuss this matter with the tribal school teachers or tribal parents?

Mr. MEHOJAH. No; we did not discuss it with them.

The CHAIRMAN. I have many other questions, but now may I call

on the vice chairman.

Senator CAMPBELL. Thank you, Mr. Chairman.

It sounds like kind of the same old deal. The decision is made

in Washington, and then the tribes are brought in after the deal

has already been made. To me, that is not consultation.

I have got about 40 questions that I want to ask, too, but I want

to also share the time we have with Senator Dorgan and Domenici.

So let me ask you just a couple.

First, let me say one thing about education and the President,

and that is this. When Senator Domenici and I met with the President and 28, as I remember, tribal leaders in Las Cruces when he

was a candidate, he made a commitment then to improve Indian

education, and told us then of his commitment to put more money

into school construction.
369

I think he has kept his word; maybe not up to the level he would

have wanted, or we would have wanted, but he was kept his word

in that respect.

I was rather surprised to hear Senator Conrad’s statement about

the United Tribes Technical College funding. I am concerned about

that, too, because I do not think all young Indian people that go

to school want to, or maybe are not meant to be white collar workers. We have got a need for vocational instruction, too.

But as Senator Domenici alluded to, the budget request is just

that—it is a request. Congress is a separate branch and we have

some input on where we are going to put the money. I just wanted

to make a commitment to Senators Dorgan and Conrad that I, for

one, am going to do everything I can to make sure that there is

money put back in the budget for that vocational school.

Let me ask a couple of questions about the schools, since Senator

Inouye talked about the demonstration project. As I understand the

demonstration project, there are 121 schools already run by the

tribes, either under contract or with a grant agreement with the

Bureau, and that leaves 64. But if the tribe does not want to operate the school, it is automatically turned over to a private corporation.

That is not a demonstration project. It sounds like some sort of

a mandate, and I am not sure if we should not launch a pilot where

we tried it with two or three schools before we just made kind of

a blanket decision about it.

But can you describe how a contractor is chosen to run a school;

what degree of involvement do they have with the tribe before they

get that contract?

Mr. MCCALEB. I think a number of those questions will be answered as a product of the planned consultation process.

My opinion about how they would be chosen would be that the

proposers would have their credentials evaluated based upon their

achievements in other schools and what they have accomplished;

and that the local school board, along with the BIA, would look at

the similarities between the school service areas, to determine if

their experience appeared useful in terms of the local school board’s

objectives.

I think they would evaluate some things like their financial stability, because this demonstration is not going to be done in a year.

I think they have proposed the five year contracts with walking

privileges for either party.

Senator CAMPBELL. Well, I am concerned, not only as a member

of this committee, but also as a person who taught public schools

for a good number of years, about the comparative data between

these contract groups and other schools, Bureau schools, educational private schools, and so on.

Could you provide for the committee some kind of a report card

on comparative data between the people that may be getting these

contracts and the schools that are in place now?

Mr. MCCALEB. Yes; I think we can.

Senator CAMPBELL. Let me go on to another subject. The budget

request proposes a reduction in land consolidation money of some

$3 million, because there are unexpected amounts carried over

from previous years.
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That is a concern, because we identified that problem some years

ago, as you remember, Neal, and we provided the funds to fix it,

to remedy it. But now how are we going to carry it out, if we are

going to cut the funds to that program?

Mr. MCCALEB. That is a concern to me, as well, Senator. We

should have fully utilized all the funds that were available in the

fiscal years in which those funds were made available. It was a disappointment to me that that has not been done, as you indicated

it is to you.

However, the reality is that we do have some carry-over funds.

Given the environment of the budget, we felt like we would utilize

those carry-over funds, and demonstrate our ability to spend those

funds now in the coming fiscal year, and hopefully come back and

ask for additional funds for this purpose.

In fact, when we started the process, I was asking why do we not

ask for additional funds for land consolidation? It is one of the

things that everybody agrees that we ought to be doing more of.

The answer was, well, we have not spent the funds we have,

which was a very unsatisfactory answer, but that is the reason why

the funds were reduced in this fiscal year. I hope that we spend

those funds down rapidly, and that we come back in the 2004 budget, having demonstrated that ability, and ask for more money for

that.

Senator CAMPBELL. This program has met with, I think, a great

success for those tribes who have tribes who have tried it, and I

would encourage you to expand the pilot.

Mr. MCCALEB. It is popular with everybody. It is popular with

the Congress. It is popular with the Administration and, most importantly, it is popular with the service beneficiaries.

Senator CAMPBELL. I do not have to tell you the unemployment

figures on reservations. I am sure you already know them. It seems

that the success rate in employment training of the job placement

program’s success rate for Indians is rather good.

But I would like to ask, what efforts is the Bureau taking to expand that program? How is the Bureau working to ensure that individual tribes can take advantage of that employment training

program and job placement; or how do you bring the job placement

program directly to the reservations?

Mr. MCCALEB. Senator Campbell, one of the things that we are

proposing this calendar year, probably in the early Fall, is to have

an economic development summit, in which we bring both tribal

leadership, industry and investors to a common meeting in which

we demonstrate not just the need, but the opportunities on reservation lands and in Indian country for an economically viable enterprise, and attract them to bring the jobs to the reservation areas.

In other words, we want to try to focus on reservation-based jobs.

That is the general mechanism that we would propose.

Senator CAMPBELL. All right, I will submit the rest of my questions in writing. Just let me encourage you once more to consult

with the tribes before you make the decisions, not after.

Mr. MCCALEB. Yes, sir.

Senator CAMPBELL. Thank you.

The CHAIRMAN. Thank you very much.

Senator Dorgan.
371

Senator DORGAN. Thank you very much.

I neglected to and should have thanked you for the budget submission on Indian school construction. Senator Domenici did that,

and all of us who have been working on that see a ray of hope here.

I think that is a very positive piece in the President’s budget, so

thank you for that.

But let me go to the areas that are troublesome for me, as well.

Let me talk about United Tribes Technical College, and ask you,

how did it come about that the Administration’s budget recommended zeroing out that college in the budget; do you know?

Mr. MCCALEB. I think the focus of this Administration’s budget

is in the primary and secondary school years. That has been historically the mission of the Bureau of Indian Affairs in education.

It is clearly the area where our dollars would yield the highest rate

of return, in terms of student proficiency.

In fact, we are shifting some of our influence to preschool activities through the FACE Program, the Family and Child Education

Program, to try to reduce our dropout rate, enhance our proficiency

rate, and to graduate students from high school who are better prepared to go on to some post-secondary activity, whether it be a baccalaureate program or a technical training program.

Senator DORGAN. But let me ask again, is there any particular

reason that the Administration de-funded this? I mean, did someone visit the college, review the curriculum and find it wanting?

Mr. MCCALEB. I am not aware that that happened, Senator.

Senator DORGAN. Can you tell me what you are aware of then,

with respect to United Tribes?

Mr. MCCALEB. Well, I am aware that we reduced, as I indicated,

a lot of our post-secondary funding, including some tribal colleges,

a reduction of $2 million in tribal colleges, and the elimination, in

some cases, of funding of the technical training.

Senator DORGAN. So to your knowledge, no one visited United

Tribes, or made an affirmative judgment that there is something

wanting at that school.

Mr. MCCALEB. No; I do not think that happened.

Senator DORGAN. All right, do you think it would be advisable to

have someone visit that college, and evaluate that curriculum? As

Senator Domenici indicated, we are going to consider this. I am on

the Appropriations Committee.

But if, in fact, the decision was made without visiting the college,

would you be willing to send someone to that school, and give us

an evaluation of what you think that school is contributing to those

students?

Mr. MCCALEB. I will have that done, Senator.

Senator DORGAN. Would you do that within the next 30 or 45

days, so that we have that available, both to this committee and

to the Appropriations Committee?

Mr. MCCALEB. Before the end of April, that will be done.

Senator DORGAN. All right, that is very helpful, and I appreciate

that.

Let me just say, if I can, I think you will find what I have found

and others have found. This is a unique, remarkable institution

that contributes substantially to the lives of people who want to

better themselves and, who in many cases, have a pretty tough
372

road, but who have found the way and found this as an opportunity; and I look forward to that visit.

Now let me ask about the Chairman’s line of questioning, because I do not think I got the answer. If you would please ask your

staff, and I regret that I have forgotten the gentleman’s name.

Mr. MCCALEB. Mr. William Mehojah.

Senator DORGAN. Thank you for being with us.

The Chairman asked you if you had some evidence of the improvement in student’s achievement with respect to privatizing

schools. I think Mr. McCaleb indicated that some of that came from

the District of Columbia.

There have been experiments and actual programs to privatize

certain kinds of public education throughout the country. Some of

it has been successful; some has not been successful, as you know.

Can you tell us more specifically on what basis you recommend privatization?

Mr. MEHOJAH. I think the one thing that we took a look at, as

Mr. McCaleb mentioned, was various options that we could provide

to schools and to tribes.

One of them, of course, like you mentioned, are the private companies, education management companies. There are approximately seven of those companies that are out there in the country,

the largest of which is the Edison Schools, headquartered out of

New York City. They have about 75,000 kids in their system.

We have taken a look at their track record, to see how they performed over the years, in some of the many similar populations,

with unemployment, poverty, under-education, those kinds of factors.

We have also looked at a couple of the others, to see what they

do, and we visited some of the schools, to take a look at how they

operate, how they structure their days, et cetera.

I think we have done a cursory review of them, and have collected some data, both from them, as well as from outside sources,

to see how they have fared.

Senator DORGAN. And I think the Chairman was asking the

questions that would lead to our asking, could you provide that

data to us then? If you have collected data sufficient so that you

have made a judgment about privatization and the advantages,

perhaps, of privatization, could you share with us the information

that led you to that conclusion?

Mr. MEHOJAH. Yes, sir; we sure could.

Senator DORGAN. Do you agree that, in some cases, the privatization of schools has been a success; while in other cases, it has been

a failure?

Mr. MEHOJAH. Yes, sir; we have seen that. As an example, at the

Edison Schools, we have seen some places where they have not succeeded. But their average success rate is fairly high.

Senator DORGAN. Would privatization represent a case where you

would choose the lowest bidder?

Mr. MEHOJAH. No, sir; we would choose the best provider.

Senator DORGAN. And what role would cost play in that?

Mr. MEHOJAH. The role that cost would play is that we would

show the private management company what resources currently
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go to our schools. That would be what would be available to provide

an education program.

Senator DORGAN. I think the BIA schools are found wanting.

There is no question about. I disagree strongly with those who say

that the system of public education in this country is somehow unworthy.

We did not send people to the moon and cure polio and split the

atom and splice genes, and clone animals, invent plastic, silicon,

and radars. We did no do that because we do not have a wonderful

system of public education; and because some of it is failing ought

not persuade us to privatize what I think has been a remarkable

success in this country.

Having said all that, I think the BIA schools, in many cases, are

wanting. But what I think the BIA schools represent is exactly

what the schools in trouble in the inner cities represent. The

schools inherit everything that comes from the home, the neighborhood, and the culture surrounding it. People who are having a

tough time with 50 percent and 60 percent unemployment, and

substance abuse, and a whole series of other things, import that to

the daily school. That daily school struggles with that mightily.

In most cases, with the teachers that I have visited on the reservations, in BIA schools and in virtually every other school, I come

out of that classroom thinking, ‘‘What a wonderful person. What a

remarkable person to dedicate their lives to teaching children.’’

So I have great concern about people who very quickly and easily

say, do you know what we should really do? Let us privatize America’s schools.

We have some private schools in this country that are wonderful.

Every parent has the choice to access those schools. But this country takes a back seat to no place in the world for the system of public education it has created, that allows every child to rise to whatever level that child can rise to, in a public system of education.

We do not separate them out. We do not move them through different chutes, based on our assessment of their ability. Every child,

for two centuries in this country, has benefitted from universal

education. And if that was the import of the Chairman’s questions,

then I certainly echo that.

I do not want us to be flippant or quick suggesting, to do this;

let us take public education apart; or let us take the BIA education

system apart and just privatize it. I think that is headed toward

very big trouble for our public system of education.

So thank you for listening to me. But I think some of us, at least

on this committee, will look very, very carefully at what you saw

and what you evaluated, in terms of your recommendations.

Mr. McCaleb, thank you for agreeing to send someone to United

Tribes. I think it is very important you do that. Also, let me end

on a positive note. Thank you again on the school construction

issues.

At the Ojibwe School on the Turtle Mountain Reservation, just

last year we got that funding. With those little kids walking between mobile trailers in unsafe conditions in the middle of the

howling wind in the bitter cold winter; what was going on out there

was not right for those kids.
374

We struggled and struggled. They are finally going to get their

school. Because of the recommendations, a number of other schools

are finally going to get built, as well. That is a bright spot. But do

help us with the other areas.

Tribal colleges should not be cut. Tribal colleges ought to be increased. The per pupil burden of tribal colleges that we provide is

still too low. If you compare it to every other per pupil cost in the

country, we are under-funding tribal colleges. So let us fix that, as

well.

Mr. McCaleb, thank you.

Mr. MCCALEB. Thank you, sir.

The CHAIRMAN. Thank you, very much.

Senator Domenici.

Senator DOMENICI. Mr. Secretary, let me suggest to you that

there is no orderliness about post-high school funding and which

institutions the Government is going to help and which they are

not.

I would think that if some point, if you intend to make a difference, that you might have an analysis of the Indian colleges and

the vocational schools, and try to figure out and make more sense

out of what we are trying to do.

I have an institute, too, Crownpoint Institute of Technology. It is

zeroed out in the budget. It should get a little bit of money, and

we get it every year in appropriations. But you would be amazed.

You would not pick this up in a report.

But sitting out in various places are these vocational institutions

or vocational colleges. They are getting by on a shoestring, because

sometimes the tribe funds them, in some cases; and in some cases,

they do not.

I think you would be surprised at the job training that is occurring on these kinds of facilities, including the one I have just mentioned. If you would take a look at it, while you are looking at the

post-high school vocational type institutions, I would appreciate it.

I will do everything I can to get some funding for it, because I

think you would not like it closed, if you were able to analyze its

role there in that part of New Mexico and Arizona.

Mr. MCCALEB. Senator, it happens that I am going to be in the

Farmington area the first week in April, and I will make an effort

to go by Crownpoint and view the school personally.

Senator DOMENICI. You might not be able to. It is a pretty long

distance out. But if you had time, it would probably be a joy for

them to honor you. It is a very, very exciting thing to see what happens out there.

Let me first ask you on the privatization, and give you the benefit of my experience, I think it is imperative that at the soonest and

earliest opportunity, that you get the Indian leaders together and

tell them that you are exploring this, that you are thinking about

this.

It will not happen if, in fact, the Indian leaders think that you

have surprised them, and that they have not had an input. They

will come out against it from the beginning, and we will never convert them to even give any of it a try, even if it is justified.

So I think you should go slow, but you should make sure that

the Indian leaders are in on it. Do not come to them with some-
375

thing all completed. Get a group of them interested now in

bettering their schools, and make sure that they understand that

maybe together you can be looking at this. If it is done unilaterally,

we will prohibit you from doing it, and all your good thoughts will

be for naught.

I have two New Mexico issues. I just gave you one of them:

Crownpoint Institute of Technology. We have Pueblos in New Mexico. As you know, we have many Indian Pueblos in New Mexico.

We have 17.

Those are generally small groupings, as you know, living on

large, large land holdings, and they are pueblos because they were

constructed that way during the Spanish era, and still have their

own language, and are Indian people.

Santa Domingo has a land claim settlement, and maybe this is

part of what you were talking about under not getting the money

disposed of. But Santa Domingo has a claim, and it seems like the

Government is not paying it in an orderly manner.

I would ask if you would take a look at that, and we will give

you the details of what the authorization for payment was, and ask

you to tell us when we could expect payment. If you would do that,

I would greatly appreciate it.

I have one last one, if you do not mind. The BIA is going to be

replacing a dormitory in Pine Hill, serving the Navajo Nation with

a 72 bed capacity. However, the Ramah Navajo Board has supportive evidence that a 100-bed facility is needed and justified.

Does the department concur with this information and justification? If not, I ask if you would take a look at it. In other words,

we are planning on 72, but the Board there is indicating that

would be insufficient from the beginning, and that 100 beds are

needed. So if you would look at that, I think it would be good for

us and good for you to be right, rather than get it done and be

wrong.

Mr. MCCALEB. We will make a thorough analysis of that, Senator, and we will include it in our report.

Senator DOMENICI. Thank you very much.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you very much.

Mr. Secretary, we are well aware of your time problems, and that

you will have to go to the House now. Regretfully, we will have to

submit our questions to you, sir, and I hope you will look them over

and provide us with your responses.

Mr. MCCALEB. Thank you very much, Mr. Chairman. If I could

have one concluding statement about post-secondary education and

the need for it.

The CHAIRMAN. Yes, sir.

Mr. MCCALEB. I am very sensitive and aware, and made a personal decision early in my life, relative to post-secondary education.

I wanted to get a degree as a civil engineer, and I ran out of

money. I was married and had my first child on the way.

I sold the legacy from my mother of her Chickasaw allotment in

order to finance the balance of my education, and it stood me well.

I think as much as I hated to part with that land, that education

has been very beneficial to me, and stood me in good stead. It was

the right decision, as difficult as it was.
376

I hope I have not left the impression with anybody that I depreciate or do not hold in high value the importance of post-secondary

education, whether it be a baccalaureate degree or technical training. In fact, I have some initiatives on technical training, relative

to surveyors, that we will be submitting and discussing with you.

The CHAIRMAN. I thank you very much, Mr. Secretary.

Our next witness is the Acting Assistant Administrator, Office of

Water, Environmental Protection Agency, Diane C. Regas. Madam

Administrator, welcome.

STATEMENT OF DIANE C. REGAS, ACTING ASSISTANT ADMINISTRATOR, OFFICE OF WATER, ENVIRONMENTAL PROTECTION AGENCY

Ms. REGAS. Thank you, Mr. Chairman.

Good morning, Mr. Chairman and members of the committee. I

am Diane Regas, the Acting Assistant Administrator for Water and

the National Program Manager for Tribal Programs at the Environmental Protection Agency. I very much appreciate the opportunity to be here today to speak with you about the President’s

2003 budget for EPA’s tribal programs.

The President’s budget requests for EPA reflects the agency’s

strong commitment to cleaner air, purer water, and land that is

better protected. This commitment is especially challenging with

respect to Indian country and tribal programs.

At the outset, I would like to stress that the tribal needs are significant. Tribes are disproportionately at risk by nearly every yardstick we use to measure the quality of life. Poverty and unemployment are high. Their education, economic development, and physical well being lag well behind those of the general population.

With respect to cleaner air, purer water, and better protected

land, tribal needs are truly challenging. For tribes, clean water

often means providing the basic sanitation that the rest of us take

for granted. In some instances, our funds are providing indoor

plumbing for the first time. In other cases, our funds bring modern

drinking water systems to two tribes.

For tribes, cleaner air means ensuring compliance with Federal,

State, and tribal standards. Eighty-three tribes are located in nonattainment areas for one or more air pollutants and suffer the consequences of this pollution.

For tribes, better protected land means their homelands are

places where modern life thrives as do ancient traditions and

ceremoneys. Today, there are 1,110 open dumps in Indian Country,

yet only about 12 percent of tribes have solid waste management

programs.

These are just a few of the daunting challenges that EPA and

tribes face in their efforts to reduce risks to human health and the

environment in Indian Country.

EPA’s 2003 budget requests for tribal programs is $232 million,

an increase of $3.6 million this year, and a six-fold increase since

1994, when EPA created its American Indian Environmental Office. Tribes and EPA continue to work closely to protect public

health and the environment in Indian country.
377

Our budget request reflects our ongoing commitment to working

with tribes as they build their capacity to develop and manage

their environmental programs.

For example, the General Assistance Program, often called the

GAP Program, frequently provides the tribe with its first environmental grant, which allows the tribe to hire and train its own staff

to assess the environmental conditions on the reservation and develop its own administrative, legal, and technical approaches to

solving its problems.

Currently, about 400 tribes receive General Assistance Program

or GAP funding, and I am very pleased to tell you that the 2003

budget request would allow EPA to fund an additional 45 tribes.

In addition to capacity building, our 2003 budget request will

support our continued efforts to help tribes meet their basic health

and sanitation needs. It includes approximately $18.2 million in

clean water set-aside funding to help meet the very significant tribal needs for waste water infrastructure.

I would like to note that our two statutes that provide infrastructure funding, the Safe Drinking Water Act and the Clean Water

Act, are inherently different.

Under the Clean Water Act, funding for tribal waste water infrastructure is limited to one-half of one percent of the total appropriation, while the drinking water set-aside is set at 11⁄2 percent.

The President’s budget proposes that the Clean Water Act ceiling

again be increased to one and one half percent, so that tribes receive the funding they need to support their significant drinking

water and waste water infrastructure needs.

I would also like to note that Alaska Native villages represent

the bulk of needs for both waste water treatment, where they represent 75 percent of the total needs, and drinking water infrastructure, where they represent about 50 percent of total needs.

I have personally visited Alaska Native villages and have seen

firsthand the consequences of the lack of basic sanitation and potable drinking water in some of these areas.

To help meet these staggering needs, EPA is proposing an additional $40 million over and above the Clean Water and Safe Drinking Water Act funding for infrastructure improvements in Alaska.

This is an amount equal to that provided by Congress last year.

As part of EPA’s budget, the Administration is requesting that

Congress eliminate the statutory cap on funding of implementation

of tribal non-point source management programs. Removing this

cap would allow us to help 70 tribes educate and train people on

reducing polluted runoff and implementing on-the-ground watershed protection projects.

EPA’s budget also proposes extending our authority to enter into

cooperative agreements with tribes. These agreements are instrumental in our efforts to actively engage tribes in day-to-day environmental management at the same time they develop their own

managerial capacity.

The Administration’s budget request would allow EPA to continue working with tribes to improve their environment through

numerous grant programs, training opportunities, data exchange,

and technical assistance. My written testimony provides more de-
378

tail on EPA’s 2003 budget request to support cleaner air, purer

water, and better protection of tribal lands.

Again, I thank you for the opportunity to appear before you, and

would be pleased to answer any questions.

[Prepared statement of Ms. Regas appears in appendix.]

The CHAIRMAN. Thank you very much, Madam Administrator.

Over the past 10 years, tribal interest in participating in EPA

programs and developing broad-based tribal environmental programs has grown dramatically. Has the EPA responded, and if so,

to what extent, to these growing tribal environmental needs?

For example, they have suggested that there be direct funding to

tribes to build tribal environmental capacity and implement tribal

environmental programs through either the treatment as a State

designation, or direct implementation through tribal cooperative

agreements. Have we done anything like that to recognize tribes as

States?

Ms. REGAS. Yes, Mr. Chairman; we do. Over the last few years,

since 1994, EPA has increased its GAP funding, the General Assistance Program Funding from $8.5 million that year to $57 million. That is in the President’s request for 2003. This represents a

six-fold increase.

In addition, the EPA has approved a number of tribes for treatment as a State, under our statutes. At this time, we have 23

tribes who are approved for treatment as States under Section 303

of the Clean Water Act, which covers establishment of basic standards, and two additional tribes who are approved for treatment as

a State for other programs; specifically, the Public Water Systems

Supply Program, that is operated under the Safe Drinking Water

Act.

The CHAIRMAN. Are you satisfied that the tribes are receiving

about what the States are receiving?

Ms. REGAS. We continue to invest in growth in our tribal programs. This year’s budget is no exception. Our long-term goal

would be to be able to provide all tribes with a GAP level of funding at about $110,000, which would allow the tribe to develop its

own capacity to manage programs.

Our rate of growth in that program needs to be commensurate

with our ability to adequately manage it. This year’s increased investment will allow us to take the next steps and fund 45 additional tribes, which we think is a very positive step.

The CHAIRMAN. We provide generous non-competitive grants to

cities and States. Do we provide the same for Indians?

Ms. REGAS. The EPA’s funding to States develop their ability and

capacity to manage environmental programs was generally provided first in the early 1970s. We were much later to come to the

realization of the need to provide similar funding for tribes, but we

do currently provide non-competitive funding to tribes for basic

management.

In addition, there are several different funds that we provide to

tribes. Our total investment in tribal programs in 2003 is proposed

to be approximately $232 million. The vast majority of that is in

grant programs to tribes.
379

The CHAIRMAN. I wish to congratulate you on taking the initiative to visit these far-away places, such as the villages above the

Arctic Circle.

After your visitations in Alaska and in the Lower 48, have you

come to any sort of broad conclusion as to how much would be

needed to bring Indian country to the same level that other Americans enjoy so that they may have running water and maybe even

toilets. Because on some reservations, less than one-half the homes

have running water, less than one-half have toilets. In Alaska, as

you know, they have honey buckets rather than toilets.

Ms. REGAS. Yes, Mr. Chairman; we do have an estimate of the

need to provide basic sanitation and drinking water on tribal lands.

Our current estimate of the known needs is $650 million for needs

in waste water, and 42 billion for needs in drinking water. We continue to chip away at those needs through our programs, and other

agencies provide funds for those, as well.

The CHAIRMAN. At the rate of funding at the present time, will

we be able to resolve this matter, or will it just continue. What we

have learned through our programs throughout the country is that

investment in waste water infrastructure and drinking water infrastructure will be an ongoing need for the country, far into the future.

These are not problems that are ever solved once and then we

can walk away. We see a need for continued investment in these

programs, as far as we can predict.

The CHAIRMAN. I have so many questions that I would like to

submit, if I may, for your study and response to us.

May I now recognize our vice chairman.

Senator CAMPBELL. Thank you, Mr. Chairman.

Ms. Regas, I commend you on your travels. Just for my own information, have you visited Pine Ridge, SD or Lame Deer, MT; but

particularly Pine Ridge?

Ms. REGAS. No, sir; I have not visited Pine Ridge, although a

number of EPA staff have been to Pine Ridge, and we are very well

aware of the pressing drinking water needs in Pine Ridge. We are

continuing to work with the tribe to invest in improving the level

of particularly drinking water services that are provided there.

Senator CAMPBELL. I thank you for doing that.

Any caring person that would visit those two reservations, or

many more of them in what we call Indian country, they would

know that we can do better than we have.

In my State of Colorado, we only have two land-based tribes, the

Southern Ute and the Ute Mountain Utes. The Ute Mountain Utes

have been on the same piece of land for 130 years, and did not get

fresh water until about 6 years ago, when we passed the legislation

to build a pipeline. The State helped, and we got it done.

But up until that time, the only water on the reservation was an

open ditch and a gravel back-flow filter that would not even screen

out some of the bigger bugs, let alone anything else that might be

in that water.

So I think if you applied that problem to most communities, nonIndian communities in the United States, there would be a public

uprising or some kind of an outcry. So thank you for being sensitive to that.
380

But since I mentioned the Southern Ute, let me ask you something. I know it is very difficult when you are talking about improving environmental conditions, when you have to work with the

tribes and non-Indian communities right next to the tribes.

How do you reconcile those interests? How do you regulate air

quality over Indian and non-Indian lands, when they are next to

each other, and what kind of expertise do you have working with

the tribes and communities that are non-Indians, when they are

literally right next to each other?

Ms. REGAS. The issues of jurisdiction and working with communities to provide adequate and equal levels of protection, both on

and off tribes, is one of the most difficult issues we face in implementation of our environmental programs.

In the Southern Ute Tribe specifically, there has been legislation,

as I understand, passed by the State of Colorado, and signed by the

tribal chairman, and we are continuing to work with the tribe and

the State to resolve these issues of jurisdiction, so that both the

State and the tribe will continue to have a role in protecting air

quality.

What we have learned in our management, whether it is air programs or water programs, is that the environment does not respect

these boundaries.

Senator CAMPBELL. That is right.

Ms. REGAS. We really need, in addition to being cautious and

careful, to respect the jurisdiction of the various entities, and to

work on a government-to-government basis with tribes. We do try

to bring together the interested parties, so that we can help resolve

these issues as they come up and provide protection to the people

on these lands.

Senator CAMPBELL. Well, thank you for your sensitivity to that.

Using the Southern Utes as an example, there are nine law enforcement jurisdictions on that reservation, because it is

checkerboarded, and I am sure others are the same. When you try

to resolve a problem, boy, you have to deal with an awful lot of entities at different government levels.

But thank you for that. I will submit further questions in writing.

Ms. REGAS. We would be happy to answer any questions.

Senator CAMPBELL. Thank you.

Thank you, Mr. Chairman.

The CHAIRMAN. Ms. Regas, I thank you on behalf of the committee.

Ms. REGAS. Thank you, Mr. Chairman.

The CHAIRMAN. Our final witness this morning is the Chairman

of the National Indian Gaming Commission, the Honorable Montie

Deer. Judge Deer, it is always good to have you.

STATEMENT OF MONTIE DEER, CHAIRMAN, NATIONAL INDIAN

GAMING COMMISSION

Mr. DEER. Good, good; thank you, Mr. Chairman. As you all

know, I am Montie Deer. I am Chairman of the National Indian

Gaming Commission. I do want to thank you for allowing me this

opportunity to report to you on the work of our Commission.
381

As you are no doubt aware, the other Commission members and

I are approaching the end of our terms. We appreciate the interest

and the support that this Commission has received to us and from

us. In other words, I think we have worked together for the 3 years

I have been here.

My remarks can be summarized by simply saying that the tremendous growth in the Indian gaming industry, particularly in

light of the recent dynamic changes in California, have really

strained our ability to keep pace.

In 1988, when the Commission was created, Indian gaming was

Indian bingo. Today, it is a major industry, producing revenues on

a par with Las Vegas and Atlantic City, combined.

While the Indian gaming industry has increased more than 100-

fold, the Commission, in contrast, has little more than doubled its

capacity since start-up. It is becoming increasingly difficult for the

Commission to carry out our statutory functions effectively under

the Indian Gaming Regulatory Act.

We come today to ask this committee’s support for the President’s request for the $2 million appropriation for fiscal year 2003.

To be completely candid, we view this request as an interim measure, while we work with you, your staff members, and the Indian

gaming industry and community, to secure legislation needed to

allow flexibility in our fee collection structure.

The Administration supports this one-time budget request, and

our goal of statutory adjustments to the current limitations in our

permanent financing.

The upcoming fiscal year marks the fifth consecutive funding

cycle during which the Commission has operated under a flat budget. However, by contrast, the industry now generates approximately $11 billion per year, an increase of nearly 50 percent since

our last fee cap adjustment.

If you will look at the bar graph, and I think you have copies in

your papers, this graph shows the industry’s growth through the

year 2000. We do not yet have the numbers for 2001, but we will

have them in a couple of months, and we will amend this so that

you will have that.

At the same time, the Indian gaming boom in California continues to put a severe strain on our resources. Prior to the passage

of proposition 1–A in March 2000, there were 39 gaming operations

in California. Today, there are 46. The nature of gaming in California has changed, as well, with the involvement of major commercial players, such as Harrah Entertainment, Anchor Gaming, Stations Casino, and Donald Trump.

The Commission is, nevertheless, solvent. But we remain solvent

only by allowing vacant positions to remain unfilled and reducing

our presence in Indian country.

This oversight responsibility given to the Commission by Congress requires professional employees. We must have field investigators, auditors, and lawyers, and we simply do not have enough.

But we do not have the money to hire more of these employees and

fund the travel overhead and operational expenses associated with

a larger staff.

I now refer you to the pie chart. As you can see, 84 percent of

our costs are fixed. Let me illustrate this situation by describing
382

our Audit Division. We began fiscal year 2002 with six auditors.

Through attrition, we have lost two. These positions, although critical, have not been filled because of our need to impose a hiring

freeze.

Because gaming is a cash-intensive industry, it poses special concerns. For many years, the gaming industry has recognized that

strong internal controls were essential to effectively identify and

deter irregularities in the handling of large volumes of cash. Like

other regulatory jurisdictions, the National Indian Gaming Commission promulgated its own minimum internal control standards

or MICS with the great assistance and consultation of the tribes.

It has been said that we can measure compliance with our MICS

with an appropriate level of sampling, and in doing so, make a

meaningful contribution to ensuring the overall integrity of Indian

gaming.

Unfortunately, at current staffing levels of the Audit Division, it

would take us 20 to 30 years to evaluate the over 300 existing gaming operations in Indian country.

Beyond the personnel shortages, the flat budget is beginning to

impact the quality and quantity of our consultations with Indian

tribes. We, at the Commission, believe that it is imperative for us

to consult regularly with the tribes, both in the context of specific

rulemakings and more generally, so that we can ensure that we are

meeting the precise needs of the industry.

As our budget has grown tighter, we have worked hard to continue our consultations in the context of specific rulemaking; but

this has cost us our quarterly regional consultations, where we provide extensive training and meet one-on-one with the tribes to

evaluate the needs of their industry.

This will ultimately pose a cost to the quality of our regulatory

program and the productivity of our relationship with the tribes.

In addition to these issues, we have other needs, as well. The

Commission would like to complete several projects that will pay

future dividends in terms of overall efficiency and effectiveness.

As I mentioned at the beginning of my remarks, the terms of the

current Commission members are drawing to a close. Our successors will have some significant challenges. We hope that by my remarks today, we will help pave their way as they guide the new

Commission.

Let me say that for myself, Vice Chairman Homer, and Commissioner Poust that we each appreciate the support and many courtesies that you have extended to us. Thank you, and I would be

happy to answer any questions.

[Prepared statement of Mr. Deer appears in appendix.]

The CHAIRMAN. I thank you very much, Mr. Chairman.

When one considers the gross income of the operations, $2 million seems to be so small, it is almost embarrassing. However, do

you intend to hire more staff?

Mr. DEER. To answer your question, Mr. Chairman, the first

thing we will do, if we get $2 million, is to fill the two auditor positions that have been left vacant, and also additional lower individuals to assist them.
383

We want to provide the field with the funding and the ability to

go to Indian country and do the consultations they do and do the

training that they do on site.

Then we have some technological improvements that we would

like to do. We would like to complete a financial component to the

database, so that we can track receipts and expenditures. We

would like to do an electric accounts receivable, so that the tribes

can pay their fees on line. We would like to do an electronic records

management.

Finally, an area that we have a big issue with is that old thing

called Freedom of Information Act. We have a lot of work there,

and we spend a lot of time there. So we would like to dedicate some

software in that area, if we could.

The CHAIRMAN. Will you continue your consultation process?

Mr. DEER. Certainly, as long as we can.

The CHAIRMAN. Just for the record, can you just provide us with

a list of what you just told us, about how the funds will be used?

Mr. DEER. Yes; we will give you that.

The CHAIRMAN. Now you spoke about legislation to allow flexibility in your fee structure. Has the Commission developed such a

proposal?

Mr. DEER. We are ready to prepare a rough draft and consult

with not only your staff, but with the tribal individuals and leaders

on that issue. What we are looking at now is a floating fee that we

think will work.

The CHAIRMAN. I would suggest that you do this as soon as possible, because this is a rather busy session with elections, terrorism, et cetera. So we would like to be of help.

A few years ago, Senator McCain and I introduced a measure

which would provide for a licensing fee mechanism that placed the

burden of funding for the Commission on those wishing to do business with Indian casinos by requiring them to pay a licensing fee.

Have you considered this type of proposal?

Mr. DEER. What you are getting at is what is sometimes referred

to as licensing vendors, et cetera. To do that and do the backgrounds, you would need to increase this Commission several fold,

as far as employees. That would be large amounts of dollars.

Again, you have a sovereignty issue. Do the tribes want to do

their own licensing, or do they want the Federal Government to do

that for them?

The CHAIRMAN. Well, this would not be a Federal appropriation.

We are requiring vendors to pay a fee to you.

Mr. DEER. That is correct, but then we make the decision. The

tribe does not make the decision on who gets a license.

The CHAIRMAN. But is it not your responsibility to make certain

that scam artists do not get involved in doing business with Indian

country?

Mr. DEER. I would say that is in the preamble of the act, and

I would agree with you; yes, Senator.

The CHAIRMAN. In this business, it would appear commonplace

to have people who would go out of their way to con Native people.

Mr. DEER. Any time you have cash-intensive business, I think

that is correct.
384

The CHAIRMAN. I hope the Commission will consider this proposal.

Mr. DEER. We will certainly be more than happy to have the staff

work with your staff on that issue.

The CHAIRMAN. Thank you, sir.

Well, I have other questions and I will be submitting them to

you. But before I do, I would like to thank you for your service, not

only to Indian country, but to our Nation. I wish you the best,

Judge, in future endeavors.

Mr. DEER. Thank you very much.

The CHAIRMAN. Mr. Vice Chairman.

Senator CAMPBELL. Judge Deer, I would like to also join Senator

Inouye in wishing you well in your future. We have not always

agreed, but I have always appreciated your friendship and your

openness before the committee.

I was interested, I have to tell you, about your comments about

who is moving into Indian gaming, the big corporations. You mentioned Harrah and Trump Casinos.

Well, I can remember 10 years ago, when Donald Trump, himself, testified against Indian gaming over on the House side before

the committee, when George Miller was the chairman. He testified

against it by saying, ‘‘they do not look like Indians.’’ I guess with

a certain amount of money, he can become colorblind. I think they

are looking more like Indians to him now. [Laughter.]

But I guess that just tells you how things change when there is

a lot of money on the table.

I wanted to ask you a couple of questions on your charts here.

This chart refers to the Federal oversight. Is that correct?

Mr. DEER. That is correct.

Senator CAMPBELL. But there are three layers of oversight. One

is tribal oversight of their gaming. The other two are State oversight and Federal oversight.

How does this chart compare and do you know if there has been

an increase in State and tribal oversight of their gaming operations?

Mr. DEER. I do not have the facts before me, but I would be more

than happy to try to supply you with what we have. But I would

say that it has remained constant, as far as States go. You have

some States, as you know, Senator, that are quite involved, and

you have some States that will not do anything.

Senator CAMPBELL. Yes; well, if you can find that information, I

would be interested in knowing if the activities at the State and

tribal level have increased to keep up with the growth in Indian

gaming.

You requested a $2-million increase in Federal funds, which I do

not think is exorbitant by itself. That is in addition to the $8 million in fee assessments, for a total of $10 million.

A few years ago in 1998, I worked and helped to get that celing

raised to $8 million, as you remember, Judge Deer. Since then, I

have been resistent about raising it more, because I was not convinced of the consultation or the need for it; but I know that the

amount of work is going up.

At the time, we were getting some letters here at the committee

from tribes who felt that the Gaming Commission was being puni-
385

tive, and we had talked about that, or maybe a little invasive into

the tribes’ operations.

I would just encourage you to make sure you have a lot of consultation with the tribes before you bring any legislation before the

committee, so we do not have some kind of a backlash, as we often

do here, when tribes feel they were not asked.

But maybe it is time to raise the ceiling a little bit, or maybe

more than a little bit; I do not know. But I do know the growth

has been huge since California has kind of come on line with gaming.

In the original budget, when we first started out, the ceiling was

$2.5 million. Is that not correct, when the Commission was first

formed?

Mr. DEER. I believe that is correct.

Senator CAMPBELL. I think that was it.

How long did it take to reach the $8 million ceiling that we increased in 1982?

Mr. DEER. Well, I know you remember Tony Hope was the first

chairman, and I think he had three or four employees. Basically,

for the first 3, 4, or 5 years, I think that all they did was draw up

the regulations and do the legal work, you might say.

It was not until they started having, as you recall, the field investigators living out of their suitcases. There were seven of them,

if you recall.

Senator CAMPBELL. Yes; I remember that.

Mr. DEER. Then Phil Hogen, commissioner, vice chairman, came

up with the plan of, I would say, the regional offices. I remember

you wanted to know if there was going to be one in Denver.

Senator CAMPBELL. Yes.

Mr. DEER. So I would say that it took 4 or 5 years before we got

up to the $8 million.

Senator CAMPBELL. How many regional offices are there now?

Mr. DEER. We have five.

Senator CAMPBELL. You have five, and you have increased the

field staff in each one of those offices, too, I assume?

Mr. DEER. Well, we have lost some auditors. That is where we

are hurting.

Senator CAMPBELL. I see.

Okay, I really do not have any further questions, Mr. Chairman.

But I would be interested, as we go along, in talking more about

this increase; thank you.

Mr. DEER. It was been my pleasure. Again, may I say to at least

the two of you, you have always been here and that means a lot;

thank you.

The CHAIRMAN. I thank you very much, Judge.

The record of this hearing will be kept open for another two

weeks, just in case you have addendums to make or corrections. In

light of the fact that we will be submitting questions, I believe it

will take two weeks to respond to them.

Thank you very much.

[Whereupon, at 11:26 a.m., the committee was adjourned, to reconvene at the call of the Chair.]

(387)

APPENDIX

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

PREPARED STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM

COLORADO, VICE CHAIRMAN, SENATE COMMITTEE ON INDIAN AFFAIRS

Good morning, and thank you Chairman Inouye for holding the Committee’s last

hearing on the President’s fiscal year 2003 budget request.

Today we welcome old friends Neal McCaleb from the BIA, Montie Deer from the

Indian Gaming Commission and a new friend, Diane Regas, from the EPA. I welcome you all to the committee.

It may be obvious to some, but I think we need to be reminded that this budget

request must be viewed against the backdrop of the war on terror and homeland

security. Clearly, that is where our Nation’s focus is at the present time.

Nonetheless, there are great needs in our Native communities.

The President’s request includes a $20-million overall increase for BIA programs

and I am happy to see more attention on Indian education and economic development for the BIA.

Increases are proposed for:

• Indian trust activities—+ $70 million.

• TPA—+ $24 million.

• Indian tribal courts—+ $4 million.

• Indian energy development—+ $2.1 million.

• Contract support costs—+ $3 million.

In January 2002, President Bush signed the ‘‘No Child Left Behind Act’’ which

included the ‘‘Native American Education Improvement Act’’ that I am proud to

have introduced along with the Chairman.

I commend the President for his request of nearly $293 million in new funds for

Indian school construction.

I believe that there are other ways to help get more Indian schools built, such

as school bonding, and I hope the Administration considers supporting that idea. I

know that our Assistant Secretary has supported the idea in the past.

On September 28, 2001, the GAO reported that in many categories, BIA schools

fail to produce the kind of education Indian children need so badly. I quote from

that report: ‘‘The academic performance of many BIA students, as measured by their

performance on standardized tests and other measures is far below the performance

of students in public schools. BIA students also score considerably below national

averages on college admission tests.’’

Of all 185 BIA schools, Indian tribes already operate 121 of them through grants

or under Indian Self-Determination Act contracts. The BIA continues to operate the

remaining 64 schools.

The President’s request includes a proposal to bring competition to these schools

by way of a ‘‘privatization initiative’’.

I believe in competition but I think we need to look at it carefully and ask probing

questions such as:
388

No. 1. Can we provide incentives so that the tribes would want to assume control

of the schools?

No. 2. What role would tribal governments and local school boards play in the selection of a private contractor?

No. 3. What experience do the current contractors have with Indian culture and

people?

I will reserve the balance of my time for questions for all of our witnesses Mr.

Chairman but would ask unanimous consent that my formal statement be included

in the record.

Thank you Mr. Chairman.

PREPARED STATEMENT OF HON. FRANK H. MURKOWSKI, U.S. SENATOR FROM ALASKA

Chairman Inouye, thank you for holding this series of hearings on the President’s budget request as it relates to Indians, Alaska Natives, and Native Hawaiians. It

is important to have these opportunities to receive the views of the various department heads and others who are charged with carrying out these programs, which

are so important to my constituents in Alaska.

There is no doubt about it, Mr. Chairman, there is not enough funding for many

of the fundamental programs designed to benefit America’s indigenous people. We

need to do more in order to keep our commitments to our native brothers and sisters.

We know we need more funding if we plan to address the needs of Alaska’s Native

population and Indian country. The concern I have is weather all the funding that

we do have being administered fairly? Do formulas take into consideration the various circumstances that make each region of the country unique from the rest. I

bring this up because of the extraordinary circumstances of many of Alaska’s Native

population; the weather, the isolation, the lack of roads, the transportation expense,

the vast distances, housing costs, the cost of food, et cetera. Some of these circumstances are shared with other regions of the country. Some are not. I think for

the most part BIA programs are fair and are administered with a willingness to acknowledge and account for these differences.

The one program I have concerns with, however, is the Indian Reservation Roads

program. I have several pages of questions that address what my constituents and

I believe is unfair treatment of my region in the Indian Reservation Roads funding

distribution. I look forward to working with Assistant Secretary McCaleb on correcting these inequities and have confidence that when he analyzes the program he will

see that adjustments do in fact need to be made.

PREPARED STATEMENT OF WILLIAM H. KINDLE, PRESIDENT, ROSEBUD SIOUX TRIBE

Good Morning Chairman Inouye, Vice Chairman Campbell and distinguished

members of the Senate Committee on Indian Affairs. I am William H. Kindle, president of the Rosebud Sioux Tribe representative of 24,086 Sicangu Lakota living on

the Rosebud Sioux Indian Reservation, in Rosebud, SD. We are a federally recognized Indian tribe. On behalf of the Sicangu Lakota, I want to take this opportunity

to thank you for allowing us to present our concerns to you on the President’s Fiscal

Year 2003 Budget Request for American Indian Programs. The President’s stroke

of the pen has far reaching impact upon our tribes, his budget request will directly

affect our Sicangu Lakota Oyate. It is important for you to picture behind me, our

children, people and elders. It is them in mind that I speak before you today.

As you may well know, any discussions that surface regarding American Indian

tribes and the Federal Government is based on the many treaties signed by both

Nations on the fundamental inherent rights of all Indian people on this continent

as it pertains to the many treaties signed by our people and the U.S. Government.

We stand firmly by those agreements made to us in those treaties signed by our

forefathers. I will reiterate here again, what so many tribal leaders have said in regards to sovereignty and the obligations of the U.S. Government to American Indian

tribes. Today we are asserting those treaty agreements made with us, and the sovereignty that is part of those treaties.

On November 19, 2001 in President Bush’s proclamation of the National American Indian Heritage Month the President stated that our governments must cooperate with each other on a sovereign to sovereign basis to provide Native Americans

with new economic and educational opportunities. And that Indian education programs will remain a priority, so that no American child, including no Native American child, is left behind. President Bush further stated that ‘‘we will protect and

honor tribal sovereignty and help to stimulate economic development in reservation
389

communities, he also stated we will work with the American Indians and Alaska

Natives to preserve their freedoms, as they practice their religion and culture.

In 1997 President Clinton signed an Executive Order 13175, which establishes a

government to government consultation policy with the purpose of strengthening relationships between the United States and American Indian tribes and ensure that

all executive departments and agencies consult with tribes as they develop policy

on issues impacting Indian communities, the President’s Budget Request to Congress is ultimately a policy.

Mr. Chairman, We are requesting that the Federal Government, honor our sovereignty and to remind all of the Federal programs of their responsibilities concerning American Indian tribes. We as tribal nations reaffirm those treaties made with

us as perpetual and binding documents solidified by a term used in the treaties ‘‘As

long as the grass grows and the waters flows, this land shall be yours’’ meaning

those lands contained in our 1851 and 1868 peace treaties belong to us the Eceti

Sakowin (the Seven Council Fires of the Lakota, Nakota, and Dakota Nations).

Our tribe provides services to approximately 24,086 tribal members with some

very key and vital programs. I want to inform you that the President’s request in

fiscal year 2003 falls short of what we need to effectively carryout services for our

communities.

On the Rosebud Sioux Indian Reservation, continuous efforts are being developed

to empower our youth through collaboration of our communities, the youth themselves and all of our tribally and federally funded programs. I want to talk about

what our needs are:

No. 1. New Tribal Building: One of our biggest need is for development of a new

comprehensive, culturally appropriate and centrally located tribal building for our

people. As it is our programs operate out of makeshift offices inside renovated

houses. Some of our programs are forced to purchase mobile homes for office space.

We need to centralize our Federal and tribal programs into one facility to include

the Bureau of Indian Affairs services and all of our tribal programs. We are requesting $15 million dollars to build the center of our nation.

No. 2. Wanbli Wiconi Tipi: The Wanbli Wiconi Tipe is a project on the Rosebud

Sioux Indian Reservation to build a comprehensive Youth Rehabilitation Center

funded under the Department of Justice, our elders have named this facility the

‘‘Wanbli Wiconi Tipi (the Eagle Nations Center of Renewal). This is a facility designed to address the problems with youth violence, alcohol and drug abuse, school

drop outs, juvenile delinquency and attempted suicides. To some people this project

was thought to be a maximum security, lock down facility where you put our youth

in and throw away the key, this is not the case. Instead we want to help our youth

by providing them with better opportunities for leadership, life skills development,

cultural enrichment, mentoring, and excellence in education. The Justice Department approved funding at approximately $8.5 million for construction but we have

fallen short of our construction goals. We have been forced to cut corners and

downsize the project to fit our budget because the final appropriation for this project

is not enough. Our construction cost will be short approximately $3 million. We are

in need of funding at $1.9 million for facility maintenance and operational costs.

Once this facility is completed we anticipate the need for funding of approximately

65 key salaried personnel at a cost of $3 million annually. We have a total need

of $7.9 million dollars in this area alone for fiscal year 2003. We will have an annual need of $5 million for our Wanbli Wiconi Tipi.

No. 3. The Rosebud Sioux Tribe-Youth Advocacy Center/Transitional Living Center (YAC/TLC) is yet another project our tribe is also working on. The YAC/TLC

Center is being developed with seed funds from the U.S. Housing and Urban Development Drug Elimination Program, as you may know, the funding for this program

was eliminated in the President’s fiscal year 2002 budget request. The YAC/TLC

project will be providing shelter care for approximately 100 at risk youth from ages

13 to 17 years of age. We will be providing out-patient treatment, individual coping

skills, counseling, foster home care, a home for the homeless youth, educational

services, transitional living for youth returning from rehabilitation or treatment centers, mentoring, recreational activities, adventure field trips, and cultural enrichment programs for trouble youth coming from broken homes, most importantly we

are trying to stop the State social services from placing our children in out of state

foster homes or institutions. This project will also be providing outreach services to

an additional 1000 youth of all ages. We are in need of $1.5 million dollars annually

for operation and services for troubled youth.

No. 4. Child and Family Services: The Rosebud Sioux Tribe Child and Family

Services Program provides services to families in dysfunctional homes, where the

court has intervened and is forced to remove children from homes due to alcohol

and drug related crime and addictions. This program was funded at $181,797 to pro-
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vide services to some 300 to 600 hundred clients. The tribe wants to help families

to become self-sufficient and healthy, the program also wants to develop innovative

programs to reunite families that have been separated. The Rosebud Sioux Tribe is

requesting $700,000 to provide services to those children and families.

No. 5. Indian Child Welfare Act: The Rosebud Sioux Tribe Indian Child Welfare

Act Office is responsible for enforcement and administration of this act. The office

currently has over 355 children in need of services. These are Lakota children that

have been removed from their homes and are placed in non-Indian foster homes or

facilities throughout the United States. They are tribal members and need to come

home and be placed with their own people. There are costs associated with this act

to including the cost of bringing children home, the cost of placing them in homes,

attorney fees for case by case management, and at times there will be litigation and

court costs. We are also in need of more staff to include social workers, case managers, Advocates and administrative staff. We are requesting $350,000 for this program.

No. 6. Economic Development: On the Rosebud Sioux Indian Reservation we have

an unemployment rate of 88.5 percent, we will need to create 500 jobs to make a

dent in the unemployment rate. The tribe has submitted our application for the Empowerment Zone Funding under the U.S. Department of Agriculture and developed

a Comprehensive Economic Development Strategy so that we might develop opportunities for industry or commerce to come to our area to assist us to become a viable

location to develop economically. There is not enough businesses located within our

reservation to turn our dollar around, there is no mechanism in place to retain the

dollar in our local economy. Most places in America have industrial parks and zones

we do not. The biggest problem for our area is that we have no capital. We have

some 50–100 individuals who want to start small businesses but we just do not have

the funding to assist them. We feel any funding for Economic Development will help

but we are requesting $10 million to assist us to develop our economic development

projects and to build capital so that we may start building businesses that will retain our dollar.

No. 7. In Education: President Bush has released his ‘‘leave no child behind’’ sweeping reforms, but has sweeping cuts for Indian Education Programs. In the

President’s fiscal year 2003 budget request he has with a stroke of his pen zeroed

out the United Tribes Technical College in Bismarck, ND, and has cut Tribally Controlled Community Colleges which affects our Sinte Gleska University which is on

the verge of expanding degree areas. The St. Francis Indian School was recently approved for expansion funding for its new school at around $14 million when based

on its student population increase of 7 percent per year, has an actual need of $34

million to complete its construction. The St. Francis Indian School was built a new

school in 1996, but by the time it was built, student enrollment increases by 150

percent, they are now in already overcrowded classrooms, the how can you let the

President say ‘‘leave no child behind’’ and then cut key education programs. If the

U.S. Government wishes not to leave any child behind then they will fund the Johnson-O’Malley at $200 per student, restore funding to the United Tribes Technical

College, increase funding for Tribally Controlled Community Colleges. We are in

need of $34 million to complete the construction at the St. Francis Indian School.

No. 8. Contract Support Funds: As you may know Contract Support Funds continue to be in a constant shortfall and in dire need of 100 percent funding, If you

send us a dollar by the time we receive our contract support funds we end up with

65 cents , this has a lot to do with the trickling effect tribes have talked about for

decades. With the historic under-funding adding up over the years then we are constantly operating inadequately. We can only stretch the dollar so far before it

breaks. We are in need of $1.8 million dollars for contract support.

No. 9. Our Roads Department is responsible for maintaining, servicing and repairing 200 miles of paved, gravel, earth improved and improved roads and bridges that

are a part of the Federal Aid Indian Road System. Funds are used to cover salaries

and equipment. However, we are now in need of new and updated equipment and

machinery and more staff to man an effective roads department. We are also in

need developing streets in many of our communities and the University. Are need

is for $1.5 million for roads.

No. 10. In Law Enforcement Services our tribe employs 20 police officer which

translates into one police officer per 1,204 tribal members. In fiscal year 2001, our

Law Enforcement Services received over 28,000 calls for assistance. We have 20 police officers that are already overworked and burn out is commonplace. Our tribe

would like to employ an additional 20 officers to alleviate the burden of already

overworked police force, to include equipment, vehicles, training and salaries. Our

tribe will be working with schools and community members to prevent crime. We

have a need of $1 million to address our Law Enforcement Needs.
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No. 11. Our Rosebud Agency Bureau of Indian Affairs programs are also experiencing shortfalls with the Tribal Priority Allocations Administrative Services with

an unmet need of $100,000, the Social Services Program is in need of $571,000 for

its assistance of indigent tribal members, The Real Estate Services service’s a five

county area consisting of 3.2 million acres and is understaffed with a need of $1.7

million for more staff and real estate services to deal with the tribal lands being

fractionated. The Agriculture program receives $1 per acre to manage public lands

while other Federal programs receive $3 per acre, with a tribal. This program maintains 880,000 acres and is in need of $1.8 million to manage those tribal lands. The

Forestry Program has a need to of $100,000 to manage 7,261 acres of ponderosa

pines and 18,614 acres of other various hardwoods which qualifies as a Category

1 reservation according to 25 CFR, Part 163.36. The Community Fire Protection line

item in the TPA system has never been funded but we are requesting $100,000 permanent funding to help us with our fire departments to facilitate quick responses

for local fires. Our fire department has responded to 25 structure fires in fiscal year

2001.

In Conclusion. Chairman Inouye, Vice Chairman Campbell, and the distinguished

members of the Senate Committee on Indian Affairs, our tribe will hope that what

we have testified here today will be heard back home in the services we provide.

Once again I want to thank you for allowing us to present our concerns. I would

hope that you take our concerns and assist our tribe with our request.

RESPONSE TO QUESTIONS SUBMITTED BY HON. DANIEL K. INOUYE, U.S. SENATOR

FROM HAWAII, CHAIRMAN OF THE SENATE COMMITTEE ON INDIAN AFFAIRS

Department of the Interior Privatization Proposal

Question: The Department of Interior has proposed privatizing the administration

of schools operated by the Bureau of Indian Affairs, if an Indian tribe does not elect

to operate the school as a grant school. Does the Department of Education have any

experience with private organizations that operate schools? Are there any reports

or ratings on these private organizations available?

Answer: Because, unlike the Bureau of Indian Affairs, the Department of Education does not operate schools, we do not have direct experience privatizing the administration of schools. We are aware that, in a number of school districts across

the country, contracting with private companies is an actively discussed option, particularly in situations where the schools are consistently low performing. Some districts are, in fact, experimenting with this approach.

The Center for Education Reform, an independent, non-profit advocacy organization and clearinghouse for information on education reforms, recently published a

catalog of major companies operating public schools in Public-Private Partnerships:

A Consumer’s Guide. The catalog, designed as a resource for parents and educators,

identifies 19 education management companies, both for-profit and not-for-profit,

that operate about 350 schools. Many of these schools are charter schools; others

are non-charter public schools.

Office of Indian Education

Question: It is the committee’s understanding that the Office of Indian Education

Director’s position is unfilled. When do you expect this position to be filled? If regulations are developed for title VII, how do you propose to ensure that the needs of

American Indian students are met if the Director’s position is not occupied?

Answer: We expect to complete the process of interviewing candidates for the position of Director within the next few weeks, and then to make a selection. Because

this is a Senior Executive Service position, our selection will then have to go to the

Office of Personnel Management (unless a current SES member is selected.) Once

the submission reaches OPM, our selection will be reviewed by a Qualifications Review Board. This final step in the process typically takes a few more weeks to complete. Thus, we hope to have a new Director selected and on board by June.

The Office of Indian Education is currently under the leadership of an Acting Director who has many years of experience with the program. She is overseeing implementation of the new Act, including the very minor changes we will make in the

regulations for Indian Education.

National Advisory Council on Indian Education

Question: Over the last 5 years, the budget for the National Advisory Council on

Indian Education has been $50,000. How much is the Department requesting for the

Council for Fiscal Year 2003? How much does the Department estimate that the

Council needs to establish its office within the Department of Education and be

staffed adequately?
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Answer: Since 1996, the Department has not requested specific amounts for the

National Advisory Council on Indian Education in annual budget requests. Instead,

funds are allocated from the Office of Elementary and Secondary Education’s administrative funds to cover Council expenses.

The Department supports Council activities without creating separate office space

and a full-time staff. We believe this arrangement has been more cost effective, and

that it effectively meets the Council’s needs. The Department’s administrative funds

support Council meetings and other activities. In addition, staff from the Office of

Indian Education provide assistance to help the Council fulfill its duties.

Tribal Colleges

Question: The Department is proposing funds for the Adult Education State Grant

under Title II of the Workforce Investment Act (Adult Education and Family Literacy). Because there is a critical need for basic adult education in Indian country,

does the Department support reserving $5 million of the funds for the Adult Education State Grant for Tribal Colleges and Universities?

Answer: Under the current authorization, eligible entities for Adult Education

State grants include the States, the District of Columbia, Puerto Rico, and the Outlying Areas (Virgin Islands, Guam, American Samoa, Northern Mariana Islands,

Marshall Islands, Micronesia, and Palau). In addition, the statute specifies setasides for national leadership activities, the National Institute for Literacy, and incentive grants. The statute does not currently contain any provision for reserving

funds for tribal colleges and universities and our budget request does not call for

creation of such a set-aside.

Research Activities

Question: In your testimony, you indicated that the Department has established

a comprehensive research agenda for Indian education and that fiscal year 2003

funds will be used to implement that agenda. What type of assurances are in place

to ensure that researchers comply with the research agenda—that is tribal consultation of research designs and instruments—when implementing the Agenda?

Answer: The Department plans to ensure that there is tribal consultation and involvement in the various stages of implementing the research agenda and the National Study of Indian Education. The development of the research agenda itself entailed extensive Native consultation through panels, a 2-day conference, and focus

groups in tribal areas. In the near future, we plan to implement a first-stage feasibility and design study that will include the public presentation of progress reports

in geographical areas that will facilitate American Indian and Alaska Native input.

Native American researchers will serve on the technical advisory panels for the

major studies being planned.

Question: The research agenda acknowledges that most research is done by nonnatives. What type of procedures will the Department use to ensure that the Department works with tribal colleges and Native researchers? What are the parameters of the first issue to be researched? How will the additional funds for fiscal year

2003 be used to implement the Agenda?

Answer: For all contracts for research supported under the American Indian and

Alaska Native Education Research Agenda, the Department will give preference to

Indian tribes, organizations, and institutions, consistent with Section 7143 of the reauthorized ESEA.

Currently, American Indian researchers are principal investigators on two of the

initial contracts supported under this agenda. One study is an analysis of 2000 Census data that focuses on the educational status of American Indians and Alaska Natives. Another project is looking at factors in achievement for Indian students. A

third study, still in the planning stage, will use NAEP data to establish baseline

data on the academic achievement of American Indian and Alaska Native students.

The increase for fiscal year 2003 will be used for the studies mentioned above.

Education Planning in Afghanistan

Question: During your testimony before the committee on March 5, 2002, you indicated that you would provide the names of the individuals who have participated

in education planning activities in Afghanistan.

Answer: In January 2002, Secretary Paige met with Afghan Minister of Education

Rasool Amin and Minister of Higher Education Sharif Faiz at the Department of

Education in Washington, DC as part of the visit to the United States by Chairman

Hamid Karzai of the Afghanistan Interim Authority and other high-ranking Afghan

officials. Secretary Paige noted that the United States intends to be a supportive

partner to Afghanistan for the long term. He offered to work with the Department

of State, the United States Agency for International Development, and the Government of Afghanistan to identify concrete ways in which the United States can assist

in addressing the country’s educational needs.
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Education planning activities in Afghanistan are still in the very early stages of

development. The Department will participate in an informal interagency working

group on Afghanistan led by the State Department.
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