although they may have initially worked on some policies without this process, we are now heartened by their apparent attitude to formally follow the procedures described above.

5. Our comments above concerning the Education Assistance portion of the Act together with Mr. Calvin Isaac, Chief of the Mississippi Band of Choctaw Indians, speak to our opinion of the education portion of the Act and the Regulations.

III. Additional USET, Inc. Concerns

The following comments refer specifically to the BIA proposed regulations. We have sent extensive comments to Commissioner Thompson and many of them are incorporated in this testimony in a different form than contained in the comments to the Commissioner. However, several major points were not incorporated in this testimony above.

1.

Section 401.75, Subsections (c), (d), and (e)
of Contract for Cause

Cancellation

Subsection (c)

The effect of Subsection (c) is to give individual tribes the right to cause the cancellation of a contract simply on the basis that they consider the services provided under the contract to be unsatisfactory. This goes beyond the intent of the law. The standard should be whether the terms and conditions of the contract are being met as opposed to the subjective feelings of the tribes. It also places an unrealistic burden on tribes to affirmatively state that they are satisfied with the service within 45 days. Subsection (d)

Subsection (d) is extremely dangerous to the tribes. It varies substantially from the language in the May 9 draft and undermines the basis of

trust attempted to be established by Congress in the Act. It imposes, and

allows the BIA to impose, a non-Indian contractor on the tribe and such power should not be allowed. In addition, the implication is that the Bureau will take over the function before a final hearing on the merits. This violates the tribal organization's due process unless the basis for the cancellation of the contract is that there is an immediate threat to safety; and even in that case, a hearing must be held within 10 days.

Further, Subsection (d) allows the Bureau to say that it does

not have sufficient forces on hand to immediately perform the work as an excuse in not carrying out the program for some period of time. This violates the basic trust responsibility to the tribes.

Subsection (e)

Subsection (e) is equally dangerous. The insidious effect of this section is to allow the Bureau to discontinue service in the program area with the excuse that current funds are not available. History and experience has shown that the Bureau can find moderate amounts of money for those purposes which it wishes. There is considerable uncertainty among Indian people as to whether the Self-Determination Act will work and, if so, whether it will work to their benefit. Any power in the BIA or IHS to take away trust services such as found in these portions of Section 401.75 support that insecurity and uncertainty and should, therefore, be deleted.

2. Section 406.16, Appendix A, Part 1, F - Indirect Costs

Although the proposed regulations provide that indirect costs may be negotiated, they do not require BIA to recognize indirect cost rates established and negotiated with other departments such as HEW and DOL. Some tribes and Indian organizations currently have established rates with other

64-882 O - 76-28

departments and imposition of negotiation with BIA would cause excessive expense as well as needless time and confusion. In any event, an approved indirect cost rate approved by another department should be presumed to be acceptable by BIA.

A further major problem is raised in this section. The program departments of BIA are presently supported by the BIA administration. This is a cost in addition to the program. Accordingly, money should be made available to the tribes for a portion of the administrative cost needed by the tribe to support the program under the contract. Otherwise, contracting will be a definite burden to tribal administration. Tribes should, therefore, be compensated for administrative expenses with non-program money.

3. Section 14 H-70.609 - Equal Opportunity

Since Indian tribes are exempt from the equal opportunity requirements under the Indian Civil Rights Act, this provision in the Regulations imposes obligations far in excess of those intended by Congress. There is nothing in this Act which could imply a change in policy by Congress in this area, and this section imposing non-discrimination obligations on the tribes is in excess of the Secretary of Interior's power. Therefore, we feel that this section should be deleted.

CONCLUSION

We wish to stress to the Committee and through it to Congress, that all of our tribes consider this Act as an experiment and that none of our tribes can fully trust their future to the success of the Act. Many questions cannot be answered at this time and we are sure many questions cannot even yet be conceived. Therefore, we urge Congress to be aware of some of the dangers seen by Indian leaders with the passage of this Act. Perhaps the most

insidious effects that could come from this Act would be future funding

cuts either to tribal programs or BIA, IHS budgeting, as a result of tribal

contracting.

Mr. BEGAY. I would like to make note of Chief John Crowe's letter to you which is a part of our testimony. I would like to include thatSenator ABOUREZK. It can go in the record.

[The letter follows:]

Senator JAMES ABOUREZK,
U.S. Senator,

Washington, D.C.

THE EASTERN BAND OF CHEROKEE INDIANS,

Cherokee, N.C., October 15, 1975.

DEAR SENATOR ABOUREZK: This letter is prompted by a considerable degree of concern regarding the possible consequences of Public Law 93-638. I feel that the implementation of the Indian Self-Determination and Education Assistance Act will disrupt, impede and/or negate a number of successful and stable programs which are currently in operation. Specifically, The Eastern Band of Cherokee Indians is opposed to the emphasis which Public Law 93-638 places on the establishment of contracting services, and we urge you to assist us in seeing that necessary provisions are made for the protection of Indian Tribes who are opposed to the usage of contracting. My opposition is based on the following grounds:

1. Contrary to the proposed objective of futhering "the self-determination of Indian communities," Public Law 93-638 will encourage the development of contracting services, a consequence which could have disastrous results for the Eastern Band of Cherokee Indians.

2. Public Law 93-638 does not make adequate provisions for the future security of detailed Federal employees. Specifically, the Act stipulates that such employees "may be detailed to a tribe or a tribal organization for two years (renewable for up to two more years)." This indicates that Public Law 93-638 considers four years to be the maximum length of time for the use of detailed employees. What becomes of these employees after four years?

3. Considering the emphasis and "encouragement" placed on the use of contracting services by Public Law 93-638, it seems logical to anticipate the eventual development of a funding process which gives priority consideration to tribes seeking funds for contracting services. Such a process would be singularly unfair to the Eastern Band of Cherokee Indians. Traditionally, we have tended to avoid contracting due to the significant number of disadvantages involved (tribal politics, complexities of annual funding, auditing, and reporting procedures).

4. Public Law 93-638 would result in significant changes in our present organizational structure and the duties and responsibilities of our personnel. We feel that such changes would produce an excessive degree of inefficiency, dissatisfaction and instability.

Certainly, there are a number of other reasons for our opposition to Public Law 93-638; however, the aforementioned characteristics embody our major dissatisfactions. In addition, we realize that a total rejection of all goals, objectives and potential benefits contained in this Act is unrealistic. However, we do feel that Public Law 93-638 requires extensive revision, and we request your support in opposing its implementation. We desire a comprehensive evaluation of Public Law 93-638, and a careful consideration of specific negative consequences on individual Indian tribes, bands or groups. In its present form, this Act is not in the best interest of the Eastern Band of Cherokee Indians, and we request the right to be given proper consideration.

Sincerely,

JOHN A. CROWE, Principal Chief, Eastern Band of Cherokee Indians.

Senator ABOUREZK. The next panel is the National Indian Education Association, Mr. Ken Ross, John Tiger, Leland Bordeaux, and Dorothy Small.

STATEMENT OF JOHN TIGER, ACTING EXECUTIVE DIRECTOR, NATIONAL INDIAN EDUCATION ASSOCIATION

Mr. TIGER. Good morning, Mr. Chairman. Let me apologize for Ken Ross who is the chairman of the board of directors. He called