Supreme courts rules on contract support costs

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WASHINGTON - The U.S. Supreme Court delivered a resounding victory for
tribal self-determination contracts March 1, ruling 8 - 0 that the federal
government "is legally bound to pay the 'contract support costs' at issue"
in two precedent-setting lawsuits brought by the Cherokee Nation and the
Duck Valley Shoshone Paiute.

Contract support costs are defined as the "reasonable costs" tribes incur
in contracting to carry out federal services with federal funds under the
Indian Self-Determination and Education Assistance acts.

Tribes nationwide have argued that the government's historical failure to
pay these costs has curtailed crucial services to Indians. The government
and its agencies have not disputed that the costs are real: they are an
integral part of other federal contracts, not special treatment for tribes
but an expected expense.

But the Clinton and Bush administrations have maintained that the contracts
are unique because they are paid for by funds appropriated by Congress.
When congressional appropriations fail to provide fully for agency programs
as well as tribal contract support costs, according to the government
position, the costs don't have to be paid - notwithstanding the contract -
if the agency has allocated funds to other programs.

The court put this reasoning to route, along with a host of subsidiary
points the government had raised in its defense: "Thus, in order to show
that its promises were not legally binding, the government must show
something special about the promises at issue. It fails to do so here."

The Cherokee Nation claims the government owes it $8.5 million. The
Supreme, Court remanded that particular claim to lower courts for
reconsideration in light of its March 1 decision.

Other tribes have monitored the case with claims of their own in mind. The
court dismissed a government defense that a 1999 law protects it from
retroactive tribal claims of a kind filed by the Cherokees, and forbade
interpreting that law "to retroactively bar payment of claims arising under
1994 through 1997 contracts. That would raise serious constitutional issues
by undoing binding governmental contractual obligations."

However, one Capitol Hill insider expressed wariness as to whether Congress
will actually pay full contract support costs to tribes, warning that
federal departmental and agency leaders will besiege congressional
appropriations committees with pleas for intervention. If the past decade
is any indication, lawmakers may attach riders to spending bills with
language subverting the Supreme Court ruling.

In addition, said a lobbyist long active in tribal issues, "there's Indian
money and there's everything else" - meaning contract support costs could
be paid out of "Indian money" for other Indian-specific programs, which in
turn would be short-changed in the current federal budget, constricted by
$300 billion in war costs.

The only guarantee against these outcomes, he added, is for Indian people
to prevail with their congressional representatives.