Indian Self-Determination Act: Shortfalls in Indian Contract Support Costs Need To Be Addressed
RCED-99-150
Published: Jun 30, 1999. Publicly Released: Jun 30, 1999.
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Highlights
Pursuant to a legislative requirement, GAO provided information on the Bureau of Indian Affairs' (BIA) and the Indian Health Service's (IHS) management of contract support funding under the Indian Self-Determination and Education Assistance Act, focusing on: (1) to what extent and for what reasons contract support costs and the associated funding shortfalls changed over the past decade, and what can be expected in the future for these costs; (2) how the shortfalls in funding for contract support costs affected tribes; and (3) whether the act's provisions for contract support costs have been consistently implemented.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Congress, in its deliberations on how to best provide funding for the Indian Self-Determination Act, may wish to consider a number of alternatives to the current mechanism for funding Indian contract support costs. |
Closed – Not Implemented
|
As of August 1, 2003, no new legislation had been introduced in the 108th Congress to reform the payment of contract support costs for Indian programs. No legislation was introduced in the 107th Congress. During the 106th Congress, Representatives Don Young and J.D. Hayworth introduced the "Tribal Contract Support Cost Technical Amendments of 2000" on March 30, 2000 (H.R. 4148). The bill provided for the consolidation of contract funds with contract support funds, as called for by one of the alternatives in GAO's report. A hearing was held on the bill on May 16, 2000, and the bill was passed by the House of Representatives on October 18, 2000. The Senate did not act on the bill before the adjournment of the 106th Congress. |
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Health and Human Services | The Secretaries of the Interior and Health and Human Services should ensure that BIA and IHS work together, and with Congress and Indian tribes, to coordinate their practices and policies governing the payment of direct contract support costs and to help ensure that their payment is consistent between the two agencies. |
Closed – Implemented
The Department of Health and Human Services' Indian Health Service issued its revised policy guidance on contract support costs--Indian Health Service Circular No. 2000-1--on February 4, 2000. The policy has a section clarifying the computation of direct contract support costs, which was discussed by the Indian Health Service with tribes and Interior's Bureau of Indian Affairs. Although the Indian Health Service has this policy, the Bureau of Indian Affairs does not yet have a policy for paying direct contract support costs.
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| Department of the Interior | The Secretaries of the Interior and Health and Human Services should ensure that BIA and IHS work together, and with Congress and Indian tribes, to coordinate their practices and policies governing the payment of direct contract support costs and to help ensure that their payment is consistent between the two agencies. |
Closed – Implemented
The Bureau of Indian Affairs has agreed to begin paying direct contract support costs. On December 6, 2002, the New Mexico District Court approved a settlement involving the Department of the Interior for the payment of direct contract support costs for fiscal years 1993 and 1994, "non-capped" years. With this policy change the Bureau of Indian Affairs and the Indian Health Service will have consistent policies on direct contract support costs as we recommended.
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| Department of Health and Human Services | The Secretaries of the Interior and of Health and Human Services should ensure that the two agencies correctly adjust funding when tribes use provisional-final indirect cost rates. |
Closed – Implemented
The revised policy guidance issued by the Department of Health and Human Services' Indian Health Service on February 4, 2000--Indian Health Service Circular No. 2000-01--directs that adjustments be made when tribes use provisional-final rates. When the final rate is lower than the provisional rate, the local Indian Health Service Area Office "is required to determine if the reduction has resulted in the awardee receiving more...funds than is otherwise permissible under the new rate." Any excess funds can be used to offset other shortfalls in funding for contract support costs. Furthermore, "If the awardee refuses to...return these funds, then the Area Office is expected to file a claim against the awardee in the amount of the overpayment in accordance with the Contract Disputes Act."
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| Department of the Interior | The Secretaries of the Interior and of Health and Human Services should ensure that the two agencies correctly adjust funding when tribes use provisional-final indirect cost rates. |
Closed – Implemented
An October 5, 2001 memorandum from the Acting Director of the Bureau of Indian Affairs' Office of Tribal Services directed awarding officials to include, as part of their post award procedures, a review to determine whether an overpayment had been made to tribes using provisional-final indirect cost rates.
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Topics
Administrative costsAppropriated fundsContract administrationFunds managementIndian affairs legislationNative AmericansIndian self-determinationOverhead costsSelf-determinationIndian health services