Court Opinion

ID: 7215186
Source: CourtListenerOpinion
Date Created: 2022-07-25 00:45:18.300266+00
Date Added: 2024-06-11T16:16:59.350009
License: Public Domain

ALARCÓN, Circuit Judge,
dissenting.
I respectfully dissent. The district court did not err in granting IHS’s motion for summary judgment because Congress did not appropriate any money to the ISD Fund in fiscal year 1999.
I
Norton Sound first contends that its right to receive the settlement amount of $349,612 was not contingent on Congress’s appropriation of funds to the ISD Fund. The plain language of the 1999 AFA belies this argument. The 1999 AFA provides that:
The amount for contract support due from the Indian Self Determination Fund for FY ’96 and FY ’97 is $349,612. The parties acknowledge that the IHS intends to pay contract support costs according to IHS Circular [96-04],
Admin. R. at 436 (emphasis added). An appendix to the 1999 AFA reflects that the $349,612 was to come from the “no year” appropriations account and, more specifically, the “Indian Self Determ[ination]” line item. Id. at 461A. A footnote to this fine item states that payment of the $349,612 was “subject to ISD appropriations.” Id. Thus, the language of the 1999 AFA made payment of the $349,612 contingent on a specific earmarked congressional appropriation to the ISD Fund.
The history of the appropriations relating to contract support costs also demonstrates that Norton Sound’s right to receive the $349,612 was conditioned on Congress’s appropriation of sufficient funds to the ISD Fund. Congress established the ISD Fund in fiscal year 1988 to earmark specific funds for the additional contract support costs that result when tribes contract for new and expanded programs. See Continuing Appropriations, Fiscal Year 1988, Pub. L. No. 100-202, 101 Stat. 1329, 1329-245 (1987) (earmarking $2.5 million “for the establishment of an Indian Self-Determination Fund”). From fiscal year 1994 to fiscal year 1998, Congress required the IHS to set aside $7.5 million of its lump-sum appropriation to be used for the ISD Fund. See Department of the Interior and Related Agencies Appropriations Act, 1994, Pub. L. No. 103-138, 107 Stat. 1379, 1408 (1993) (earmarking $7.5 million for the ISD Fund for fiscal year 1994); Department of the Interior and Related Agencies Appropriations Act, 1995, Pub.L. No. 103-332, 108 Stat. 2499, 2528 (1994) (same, fiscal year 1995); Omnibus Consolidated Rescissions and *840Appropriations Act of 1996, Pub.L. No. 104-134, 110 Stat. 1321, 1321-189 (1996) (same, fiscal year 1996); Omnibus Consolidated Appropriations Act, 1997, Pub.L. No. 104-208, 110 Stat. 3009, 3009-213 (1996) (same, fiscal year 1997); Department of the Interior and Related Agencies Appropriations Act, 1998, Pub.L. No. 105-83, 111 Stat. 1543, 1582 (1997) (same, fiscal year 1998).
In fiscal year 1999, Congress did not earmark any appropriations for the ISD Fund. Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999, Pub.L. No. 105-277, 112 Stat. 2681, 2681-278 (1998). Instead, Congress imposed a moratorium on the IHS from entering into any new or expanded contracts and set a cumulative cap of $203,781,000 on all contract support costs. Id. at 2681-279. Congress had capped cumulative contract support costs in fiscal year 1998 as well. Pub.L. No. 105-83, 111 Stat. 1543, 1583. The fiscal year 1999 cumulative cap represented a $35 million increase over the fiscal year 1998 cap.
Congress directed the IHS to use the $35 million increase to lessen the disparities in contract-support-cost funding among all contracting tribal organizations. Conference Report on H.R. k328, Making Omnibus Consolidated and Emergency Supplemental Appropriations for Fiscal Year 1999, 144 Cong. Rec. H11044, H11382 (daily ed. Oct. 19, 1998). The conference report stated that “[t]he Committees remain convinced that the current distribution methodology employed by the [Indian Health] Service for contract support costs is inequitable and fiscally unsound.” Id. The IHS was directed “to address the inequity in the distribution of contract support cost funding in fiscal year 1999.” Id.
Norton Sound’s contractual right to receive the $349,612 payment was expressly contingent on an appropriation for the ISD Fund. As no such appropriation was made in fiscal year 1999, the IHS had no obligation to pay Norton Sound the $349,612.
Norton Sound maintains that the 1999 AFA did not make payment of the $349,612 contingent on appropriations earmarked for the ISD Fund by Congress. Norton Sound points to the 1999 AFA’s incorporation of the provisions in Circular No. 96-04 and contends that the ISD Fund included “funds identified by the IHS from funds available for that purpose.” Circular No. 96-04 indeed provides that tribal organizations “on the [ISD Fund] priority list will remain on the priority list and be considered in priority order when funding is made available by appropriation or reprogramming.” Admin. R. at 202 (emphasis added). Nevertheless, the 1999 AFA explicitly makes payment of the $349,612 “subject to ISD appropriations.” Id. at 461A (emphasis added). “Appropriation” is a term of art, defined as “[a] legislative body’s act of setting aside a sum of money for a public purpose.” Black’s Law Dictionary 98 (7th ed.1999). Only Congress can make an appropriation. See U.S. Const, art. I, § 9, cl. 7 (“No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law....”). The phrase “subject to ISD appropriations” in the 1999 AFA removes the possibility that payment of the $349,612 could be triggered by the IHS “reprogramming” general contract-support-cost funds to the ISD Fund.
II
Norton Sound also asserts that adequate funds were available to the IHS to pay the $349,612. Norton Sound contends that the record “shows that the IHS allocated the majority of the $35 million increase in contract support funding to the ISD Fund for distribution to tribal contracts with new or expanded contracts.” The record, *841however, does not support Norton Sound’s contention that the IHS reprogrammed any of the $35 million increase to the ISD Fund.
In response to Congress’s instruction to “address the inequity in the distribution of contract support costs in fiscal year 1999,” the IHS held numerous meetings with tribal representatives to determine the most appropriate method to distribute the $35 million contract-support-cost increase. Following these meetings, the IHS abolished its queue system and adopted a “bottom-up” methodology to distribute the $35 million increase. Under this system, the IHS reviewed all contract-support-cost shortfall data from all contracting tribal organizations (i.e., tribes that were in the ISD Fund queue and those that were not). Based on this review, the IHS recalculated contract-support-cost needs for all tribal organizations. Under the bottom-up methodology, tribes that were receiving at least 80.42% of their total contract support costs received no additional funding. Tribes receiving less than 80.42% of their total contract support costs were brought up to the 80.42% floor by expenditure from the $35 million.1
In using the bottom-up methodology, most of the $35 million went to tribes that had requests pending in the ISD queue. The rest went to tribes that were not in the queue. The IHS’s distribution sheets make reference to “ISD” and “FY 1999 Indian Self-Determination Funds,” but when read in the context of the IHS’s overall contract-support-cost shortfall summary tables, it appears that these references are merely to differentiate those tribes that were in the queue from those tribes that were not in the queue. In sum, the record does not reveal that the IHS reprogrammed any of the $35 million increase to the ISD Fund when it used the bottom-up allocation method.
The record reveals that Norton Sound was treated fairly. The IHS applied the bottom-up calculation to Norton Sound in the same manner as it did with all the other contracting tribes. Applying the bottom-up methodology, the IHS determined that Norton Sound was receiving 84.7% of its total contract support costs. Thus, Norton Sound did not receive any of the $35 million that had been appropriated for contract-support-cost shortfalls in fiscal year 1999. In the process, the IHS reviewed Norton Sound’s ISD Fund request of $349,612, recalculated it to $75,031, and used this amount in making its determination that Norton Sound was receiving 84.7% of its total contract support costs. If the IHS had used the $349,612 amount instead, Norton Sound’s total contract support costs would have been funded at 80.86%, which still would have been above the 80.42% floor. Because of the lack an appropriation, funding was not available in 1999 either for the $349,612 Norton Sound alleges it is entitled to or for the recalculated amount of $75,031.
Ill
Norton Sound contends that, even if “the IHS did not otherwise allocate adequate funds to the ISD Fund in FY 1999 to pay Norton Sound, the IHS had an obligation to make such funds available.” Norton Sound cites Blackhawk Heating & Plumbing Co. v. United, States, 224 Ct.Cl. 111, 622 F.2d 539 (1980) (per curiam), to support this contention. In Blackhawk, the Veterans Administration (“VA”) sought to avoid paying a litigation settlement on the ground that it had no specific funds set aside for such a payment and that pay*842ment would therefore violate the Anti-Deficiency Act. Id. at 548, 552 n. 9. Although the VA had ample money in its lump-sum appropriation to fund the litigation settlement in full, the VA claimed that the agency’s administrative allocation of its funding created an account that had insufficient funds to cover this particular settlement amount. Id. at 552. The court rejected this argument and observed that, “[s]o long as appropriations are sufficient in overall amount to meet obligations, it is the agency’s duty to remedy any shortfall that might exist in a particular project account.” Id. at 552 n. 9.
Norton Sound maintains that Blackhawk “demonstrates that where there is a shortfall in an objective for which the agency has an obligation, the agency has a duty to shift, or reprogram funds from other objectives within a lump-sum appropriation to remedy that shortfall.” Appellant’s Br. at 50 (emphasis in original). Norton Sound’s reliance on Blackhawk is misplaced. In Blackhawk, the VA had sufficient funds in its lump-sum appropriation to pay the litigation settlement. Id. at 552. In contrast, here the record shows that the overall contract-support-cost funding needs for all tribal organizations far outstripped the cumulative cap that Congress placed on contract-support-cost funding for fiscal year 1999. The record reveals that, in fiscal year 1999, the overall contract-support-cost needs for all tribes were $242,985,021, which was $39,204,021 more than the $203,781,000 cumulative cap set by Congress.
The ISDEAA explicitly states that “[t]he amounts of such [self-determination] contracts shall be subject to the availability of appropriations.” 25 U.S.C. § 450j(c). The ISDEAA also broadly provides that all contract funding under the ISDEAA “is subject to the availability of appropriations and the Secretary is not required to reduce funding for programs, projects, or activities serving a tribe to make funds available to another tribe or tribal organization.” Id. § 450j-l(b) (emphasis added). No matter how the IHS distributed the $35 million, some tribal organizations would not have been paid their full contract amount. The record shows that, to fund fully the contract-support-cost needs of all tribes, an additional appropriation of $35,043,961 above the $35 million increase would have been required. The record also shows that over 100 other tribes were receiving a smaller percentage of their overall contract-support-cost needs than Norton Sound. The IHS did not have an obligation to use a part of the $35 million to pay Norton Sound’s claim. Rather, the IHS had a congressional mandate to use the $35 million in a manner that would reduce the inequity in overall contract-support-cost funding among all tribes.
My conclusion that the IHS had no obligation to pay Norton Sound the $349,612 in fiscal year 1999 is supported by our recent decision in Shoshone-Bannock Tribes v. Secretary, Department of Health & Human Services, 279 F.3d 660 (9th Cir.2002). In Shoshone-Bannock, a tribe operating under a self-determination contract filed suit against the IHS after it refused to pay the tribe its contract support costs in fiscal year 1996. Id. at 663-64. The IHS contended that the tribe was not at the head of the queue and that there were insufficient funds to pay the tribe’s contract support costs from the $7.5 million that Congress had earmarked to the ISD Fund that fiscal year. Id. at 664. The tribe argued that “the way the appropriation law is worded, the [IHS] has to provide the money for contract support costs, either out of that [ISD Fund] appropriation, or out of other money appropriated to the [IHS] if the part of the [IHS] appropriation designated for contract support costs is exhausted.” Id. We deter*843mined that the ISDEAA’s text, making all contract funding subject to the “ ‘availability of appropriations,’ and the clear statement that this limitation applies ‘notwithstanding any other provision in this Act,’ ” evidenced Congress’s intent to “exclude[ ] the possibility of construing the contract support costs provision as an entitlement that exists independently of whether Congress appropriates money to cover it.” Id. at 664-65 (footnotes omitted). We held in Shoshone-Bannock that “[tjhere is simply no Indian Health Service obligation to fund contract support costs beyond the appropriations made available for that purpose.” Id. at 667.
In the present case, Norton Sound and the IHS agreed that $349,612 was to be paid from the ISD Fund. In fiscal year 1999, however, Congress did not appropriate any funds to the ISD Fund. Following our reasoning in Shoshone-Bannock, the IHS did not have an obligation to reprogram to the ISD Fund any of the $35 million increase in its general contract-support-cost appropriations in order to pay Norton Sound the $349,612.
I would affirm the order granting summary judgment in favor of IHS.

. The IHS eventually adopted a new allocation policy based on the bottom-up methodology, which was published in January of 2000 as IHS Circular No. 2000-01.