‘‘(I) expended on projects identi-
fied in a transportation improvement 
program approved by the Secretary; 
and 
‘‘(II) used in accordance with ap-
propriations Acts and other applicable 
statutory limitations. 
‘‘(B) EXCEPTION.—Notwithstanding sub-
paragraph (A), if, pursuant to subsection (d), 
an Indian tribe receives a discretionary or com-
petitive grant from the Secretary or receives 
State apportioned funds, the Indian tribe shall 
use the funds for the purpose for which the 
funds were originally authorized. 
‘‘(2) RETROCESSION.— 
‘‘(A) IN GENERAL.— 
‘‘(i) AUTHORITY OF INDIAN TRIBES.— 
An Indian tribe may retrocede (fully or 
partially) to the Secretary programs, serv-
ices, functions, or activities (or portions 
thereof) included in a compact or funding 
agreement. 
‘‘(ii) REASSUMPTION
OF
REMAINING 
FUNDS.—Following 
a 
retrocession 
de-
scribed in clause (i), the Secretary may— 
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‘‘(I) reassume the remaining 
funding associated with the retroceded 
programs, functions, services, and ac-
tivities (or portions thereof) included 
in the applicable compact or funding 
agreement; 
‘‘(II) out of such remaining 
funds, transfer funds associated with 
Department of Interior programs, 
services, functions, or activities (or 
portions thereof) to the Secretary of 
the Interior to carry out transpor-
tation services provided by the Sec-
retary of the Interior; and 
‘‘(III) distribute funds not trans-
ferred under subclause (II) in accord-
ance with applicable law. 
‘‘(iii) CORRECTION OF PROGRAMS.—If 
the Secretary makes a finding under sub-
section (f)(2)(B) and no funds are avail-
able under subsection (f)(2)(A)(ii), the 
Secretary shall not be required to provide 
additional funds to complete or correct any 
programs, functions, services, or activities 
(or portions thereof). 
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‘‘(B) EFFECTIVE
DATE.—Unless the In-
dian tribe rescinds a request for retrocession, 
the retrocession shall become effective within 
the timeframe specified by the parties in the 
compact or funding agreement. In the absence 
of such a specification, the retrocession shall 
become effective on— 
‘‘(i) the earlier of— 
‘‘(I) 1 year after the date of sub-
mission of the request; or 
‘‘(II) the date on which the fund-
ing agreement expires; or 
‘‘(ii) such date as may be mutually 
agreed upon by the parties and, with re-
spect to Department of the Interior pro-
grams, functions, services, and activities 
(or portions thereof), the Secretary of the 
Interior. 
‘‘(f) PROVISIONS RELATING TO THE SECRETARY.— 
‘‘(1) DECISIONMAKER.—A decision that con-
stitutes a final agency action and relates to an ap-
peal of the rejection of a final offer by the Depart-
ment shall be made either— 
‘‘(A) by an official of the Department who 
holds a position at a higher organizational level 
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within the Department than the level of the de-
partmental agency in which the decision that is 
the subject of the appeal was made; or 
‘‘(B) by an administrative judge. 
‘‘(2) TERMINATION OF COMPACT OR FUNDING 
AGREEMENT.— 
‘‘(A) AUTHORITY TO TERMINATE.— 
‘‘(i) PROVISION TO BE INCLUDED IN 
COMPACT
OR
FUNDING
AGREEMENT.—A 
compact or funding agreement shall in-
clude a provision authorizing the Sec-
retary, if the Secretary makes a finding de-
scribed in subparagraph (B), to— 
‘‘(I) terminate the compact or 
funding agreement (or a portion 
thereof); and 
‘‘(II) reassume the remaining 
funding associated with the reassumed 
programs, functions, services, and ac-
tivities included in the compact or 
funding agreement. 
‘‘(ii) TRANSFERS OF FUNDS.—Out of 
any funds reassumed under clause (i)(II), 
the Secretary may transfer the funds asso-
ciated with Department of the Interior 
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programs, functions, services, and activi-
ties (or portions thereof) to the Secretary 
of the Interior to provide continued trans-
portation services in accordance with appli-
cable law. 
‘‘(B) FINDINGS
RESULTING
IN
TERMI-
NATION.—The finding referred to in subpara-
graph (A) is a specific finding of— 
‘‘(i) imminent jeopardy to a trust 
asset, natural resources, or public health 
and safety that is caused by an act or 
omission of the Indian tribe and that 
arises out of a failure to carry out the 
compact or funding agreement, as deter-
mined by the Secretary; or 
‘‘(ii) gross mismanagement with re-
spect to funds or programs transferred to 
the Indian tribe under the compact or 
funding agreement, as determined by the 
Secretary in consultation with the Inspec-
tor General of the Department, as appro-
priate. 
‘‘(C) PROHIBITION.—The Secretary shall 
not terminate a compact or funding agreement 
(or portion thereof) unless— 
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‘‘(i) the Secretary has first provided 
written notice and a hearing on the record 
to the Indian tribe that is subject to the 
compact or funding agreement; and 
‘‘(ii) the Indian tribe has not taken 
corrective action to remedy the mis-
management of funds or programs or the 
imminent jeopardy to a trust asset, natural 
resource, or public health and safety. 
‘‘(D) EXCEPTION.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
subparagraph (C), the Secretary, upon 
written notification to an Indian tribe that 
is subject to a compact or funding agree-
ment, may immediately terminate the com-
pact or funding agreement (or portion 
thereof) if— 
‘‘(I) the Secretary makes a find-
ing of imminent substantial and irrep-
arable jeopardy to a trust asset, nat-
ural resource, or public health and 
safety; and 
‘‘(II) the jeopardy arises out of a 
failure to carry out the compact or 
funding agreement. 
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