[00:00:01] Speaker 05:
Case number 22-5100, the Fahbo Nation at Balance versus United States Department of the Interior and Deborah A. Hillings in her official capacity as Secretary, United States Department of the Interior.

[00:00:14] Speaker 05:
Mr. Gordon for the balance, Mr. Cobble for the police.

[00:00:18] Speaker 01:
Mr. Gordon, good morning.

[00:00:34] Speaker 00:
Good morning, and may it please the floor.

[00:00:37] Speaker 03:
Under the Indian Self-Determination Act, federal agencies transferred tribes responsibility and the funding for providing designated programs by both members.

[00:00:51] Speaker 03:
Almost all of these programs or services, permanent in nature, require ongoing, dependable funding.

[00:01:01] Speaker 03:
1988, Congress amended the Act for the allowed purpose of preventing federal agencies from unilaterally reducing the established amount of annual funding.

[00:01:14] Speaker 03:
Congress provided that the amount of funds provided under a self-determination contract shall not be reduced in subsequent years, except in five circumstances, none of which is applicable here.

[00:01:32] Speaker 04:
Can you start with kind of explaining how a contract renewal proposal works?

[00:01:40] Speaker 04:
And specifically, does a tribe submit a renewal proposal and the first annual funding agreement for that proposal at the same time?

[00:01:51] Speaker 04:
Yes, you're right.

[00:01:54] Speaker 04:
And that's what happened in 2017.

[00:01:59] Speaker 03:
And are they approved together at the same time?

[00:02:03] Speaker 03:
And in fact, and I think this will make things clear, the annual funding agreement, or AFA as it's frequently called, is the key part of the contract that sets forth both of the services being provided and the amount of funding that's going to be provided.

[00:02:19] Speaker 03:
The rest of the contract are the standard contract from the vision.

[00:02:25] Speaker 04:
Is the annual funding agreement a successor annual funding agreement in that situation?

[00:02:33] Speaker 04:
Right.

[00:02:40] Speaker 03:
the existing contract.

[00:02:42] Speaker 03:
And so it was governed by the regulation at 900.32.

[00:02:46] Speaker 03:
That is why there's a separate regulation at 900.33 that deals with renewal contract and has the exact same effect.

[00:02:56] Speaker 04:
So let me ask a step back from the text and kind of ask a more pragmatic question.

[00:03:05] Speaker 04:
I think on 933, you're strong.

[00:03:10] Speaker 04:
At the same time, I wonder, imagine that what had happened with the 2014 original annual fund agreement had been that instead of going from a million to 15 million, which was 17 million, just a large increase, it's about 13 times more than the government says they think you deserve.

[00:03:39] Speaker 04:
Imagine that it had gone from one million to a billion.

[00:03:46] Speaker 04:
Would you be making all the same arguments?

[00:03:47] Speaker 04:
Would we have to do all the same things that you say we have to do here?

[00:03:51] Speaker 03:
The law would be the same, but Congress provided... What about a trillion?

[00:03:56] Speaker 03:
But Your Honor, if I may, Congress provided the solution when it

[00:04:01] Speaker 03:
amended the statute in 1988 when it created 5325B that provided that one way that an agency could reduce funding was if they go back to Congress and get permission.

[00:04:20] Speaker 03:
That comes up appropriations, as Congress well knows, come up every year.

[00:04:24] Speaker 04:
Well, so under that theory, all they have to do is get Congress to do what Congress hardly ever does.

[00:04:32] Speaker 03:
Well, if it's truly a windfall as the government argues, then Congress would do it, I submit.

[00:04:39] Speaker 04:
Certainly, if it was a billion or a trillion.

[00:04:42] Speaker 04:
Again, I recognize this is pretty far afield from the text of the regs, and I'm pretty with you on the text of the regs.

[00:04:49] Speaker 04:
what political incentive would Congress have in this situation to take 15 million extra dollars away from the Navajo Charter?

[00:04:59] Speaker 03:
From the Navajo Nation, after the district court in 2020 found that they have a legitimate need for all of those funds, I don't think there's any political will to do that.

[00:05:08] Speaker 03:
And I'm standing here saying

[00:05:11] Speaker 03:
that my client, the Navajo Nation deserves every penny of those funds because the funding level prior to 2014 was covering only about 10% of the actual cost of running the courts, but the Navajo Nation's courses.

[00:05:24] Speaker 04:
Let's imagine the government is right that you deserve 1.2 million or 1.5 million because of the kind of clerical error that happened during the government shutdown.

[00:05:36] Speaker 04:
You're getting 17 million a year.

[00:05:40] Speaker 04:
That's 17 million or it's 15 million extra per year.

[00:05:45] Speaker 03:
It's 15.7 million.

[00:05:46] Speaker 03:
Your honor.

[00:05:47] Speaker 03:
I've lived with these numbers for a long time.

[00:05:49] Speaker 03:
I, I think in this case in 2016 before 15 or 15.6 million.

[00:05:55] Speaker 04:
And there is a part of the statute that says it's a frag as well, that if, if the appropriations are not there, then I guess there'll be an across the board cuts.

[00:06:05] Speaker 04:
So the people who would kind of

[00:06:08] Speaker 04:
pay the cost, be hurt by the windfall, if it's a windfall, would be all of the other tribes whose budgets would be cut in order to pay for the 13 times more funding that you're receiving compared to what the agency says you're entitled to.

[00:06:28] Speaker 03:
And if it was a windfall and unfair, then those tribes might complain.

[00:06:35] Speaker 03:
and create more political world.

[00:06:38] Speaker 03:
Go back to your question.

[00:06:40] Speaker 03:
But no other tribe, Minot, has complained about the Navajo Nation getting adequate funding for its court system.

[00:06:49] Speaker 03:
They would probably complain if it were a billion.

[00:06:51] Speaker 03:
They might, Your Honor.

[00:06:53] Speaker 03:
But if it were a billion, I think this case wouldn't be here.

[00:07:03] Speaker 03:
Unless the court has further questions,

[00:07:06] Speaker 03:
and reserve any time.

[00:07:08] Speaker 01:
All right, thank you.

[00:07:09] Speaker 00:
Mr. Koppel.

[00:07:23] Speaker 00:
May I please support?

[00:07:25] Speaker 02:
I'm with the Department of Justice representing the Department of the Interior and the Secretary of the Interior in this case involving

[00:07:36] Speaker 02:
the Indian Self-Determination and Education Assistance Act, known as ISTA.

[00:07:42] Speaker 02:
The district court correctly held that neither the ISTA statute nor the regulations entitled the tribe to a permanent additional award of approximately $15.7 million each year in perpetuity

[00:08:06] Speaker 02:
merely because the secretary did not decline the proposal within 90 days.

[00:08:15] Speaker 04:
I'm not sure that merely because of the clerical mistake.

[00:08:20] Speaker 04:
It's a combination of the clerical mistake and the reg 933 where you have deliberately hide your hands and

[00:08:32] Speaker 04:
Assume something you probably don't want me to assume, but assume that they're right about how we should read 933.

[00:08:40] Speaker 04:
Why would you all have done that to yourselves?

[00:08:46] Speaker 02:
Well, it may well be that the regulation is

[00:08:56] Speaker 02:
is not optimal from the government standpoint.

[00:09:01] Speaker 02:
But the regulations were enacted with the participation and involvement of the tribes.

[00:09:15] Speaker 02:
And this was the agreed upon language.

[00:09:21] Speaker 02:
And this is one of the problems here in terms of

[00:09:25] Speaker 02:
the agency trying to correct the regulatory problem on its own, because under the statute, it has to confer with the tribe and they have to involve participation.

[00:09:44] Speaker 04:
So I understand the policy behind requiring the agency to confer.

[00:09:50] Speaker 04:
That seems appropriate.

[00:09:54] Speaker 04:
I think there was something in the briefing that the advisory committee that negotiated this added 60 something people on it.

[00:10:04] Speaker 04:
40 something were representatives of the tribes.

[00:10:09] Speaker 04:
It seems like your answer to the question is the agency got into this mess because the regulator more or less abdicated its regulatory responsibilities to the regulated party.

[00:10:24] Speaker 04:
It's not surprising that the regulated party drafted a regulation that's pretty good for them.

[00:10:31] Speaker 02:
Well, Your Honor, it's obviously the regulatory process.

[00:10:38] Speaker 02:
is collaborative, but I certainly would, well, first of all, as you indicated, I disagree with respect to the interpretation of 900.33 and we believe that the focus of the original Navajo Nation opinion was solely on

[00:10:58] Speaker 02:
on the deemed approval regulation in Navajo 1.

[00:11:05] Speaker 02:
And while the district court held and we don't agree that that applied with respect to all subsequent annual funding agreements under the initial contract,

[00:11:20] Speaker 02:
We did not believe that 900.33 stands for the proposition that it applies to a successor contract.

[00:11:32] Speaker 04:
I understand the argument.

[00:11:35] Speaker 04:
And maybe you're right about how we should read the reg.

[00:11:38] Speaker 04:
If you're wrong, if we rule against you in this case, does that mean that the tribe is just going to get $15.6 million extra dollars every year forever?

[00:11:50] Speaker 04:
Is there a way that you all will fix that?

[00:11:54] Speaker 02:
Well, I again, the the the only the only apparent solutions would be either regulatory change and then the tribes really they have no incentive to to to to agree to such a change and or or congressional action, which, as your honor pointed out, seems is very, very difficult.

[00:12:19] Speaker 04:
Why would, it sounds like now you're saying that tribes have a veto on regulatory change.

[00:12:25] Speaker 04:
Why is that?

[00:12:26] Speaker 02:
Well, it's not a veto, but it is given the language of, I believe it's 5328, 25 U.S.C.

[00:12:33] Speaker 02:
5328D, it does emphasize that the secretary has to confer and the tribes are to have involved participation in the process.

[00:12:47] Speaker 02:
So it doesn't,

[00:12:51] Speaker 02:
provide a veto per se, but it certainly suggests that the tribes have a significant voice in the formulation of the regulations.

[00:13:10] Speaker 02:
It's basically an insoluble conundrum unless the district court is correct, as we believe, that it doesn't extend to a successor contract.

[00:13:25] Speaker 04:
It's insoluble, again, if your version of conferring with the tribes is the right version.

[00:13:33] Speaker 04:
But I mean, I confer with my clerks on every case.

[00:13:35] Speaker 04:
I don't let them decide the case.

[00:13:38] Speaker 02:
I understand, Your Honor, but we don't think that the

[00:13:49] Speaker 02:
The secretary should really, should have to go there because we believe that both the statute and the regulations or the regulation concerning the contract, which is the only one applicable here, renewal contract, are clear that the relevant amount for purposes of the annual, the next contract

[00:14:17] Speaker 02:
would be the initial amount, the initial secretarial amount, which was adopted in this case in 2012 in the earlier contract.

[00:14:28] Speaker 02:
And then that doesn't, the subsequent problem that started in calendar year 2014 and continued through the end of the first contract

[00:14:41] Speaker 02:
no longer comes into play because the relevant annual funding agreement is the one that was part of the 2012 contract and that was what was renewed in 2017.

[00:15:00] Speaker 01:
Both the district court and this court are normally bound by the Indian canon.

[00:15:08] Speaker 01:
In this case, it may be even stronger

[00:15:14] Speaker 01:
governing regulation here.

[00:15:17] Speaker 01:
Is the district court's decision consistent with the canon?

[00:15:22] Speaker 02:
Your honor, we believe it is because we agree with the district court that the only sensible reading is the one that of both the statute and the regulations is the one that

[00:15:41] Speaker 02:
respects the role of the secretarial amount, which is the crucial figure for purposes of funding.

[00:15:52] Speaker 01:
The tribe would say that the secretarial amount is the amount that was approved in last year's, previous year's agreements, and you would say that it goes all the way back to the original?

[00:16:03] Speaker 02:
With respect to the contract, yes.

[00:16:06] Speaker 02:
That's right.

[00:16:10] Speaker 02:
The funding amount is clearly tied to the secretarial amount, which is the amount that the secretary would have expended on the program.

[00:16:22] Speaker 02:
And the fact that that changed because the secretary made the mistake, the fact that the annual funding agreement was increased in 2014 because of the secretary's failure to disapprove during the statutory timeline.

[00:16:44] Speaker 01:
Excuse me, Your Honor?

[00:16:45] Speaker 01:
To fail to disapprove during the statutory timeline.

[00:16:49] Speaker 01:
The secretary had a 90-day window to

[00:16:52] Speaker 01:
I disprove and didn't do it.

[00:16:56] Speaker 02:
And well, that was that was this court's decision in Navajo Nation one.

[00:17:00] Speaker 02:
But we believe that that really should be it should be cabin to to the to the original contract and should not be continued in perpetuity.

[00:17:10] Speaker 02:
Yeah.

[00:17:13] Speaker 02:
There are no further questions.

[00:17:14] Speaker 02:
I would urge the court to affirm the judgment of the district court.

[00:17:19] Speaker 01:
All right.

[00:17:20] Speaker 01:
Thank you.

[00:17:21] Speaker 01:
Does Mr. Gordon have any time?

[00:17:23] Speaker 05:
Council had three minutes and 30 seconds left.

[00:17:29] Speaker 03:
I just want to make a point that the tribe here wins not only because of 933, but the 933 says what it does because the statute requires both 5325 B, which precludes the agency from reducing funding

[00:17:51] Speaker 03:
and also 5321A, which says explicitly that when you are proposing a new contract or a renewal contract, the secretary must agree to that contract unless the funding exceeds the amount of funding that's established under 5325A, secretarial amount and contract support costs.

[00:18:19] Speaker 03:
and we absolutely are of the view that that secretarial amount as of 2017 was $17 million.

[00:18:28] Speaker 03:
And indeed the agency's own regulations provide that if you have a deemed approved contract as this court held in 2014, those funds shall be added to the secretarial amount under 5325A.

[00:18:43] Speaker 04:
If we disagree with you about

[00:18:50] Speaker 04:
your argument that the statute requires this additional amount.

[00:18:56] Speaker 04:
Or put another way, the statute requires the agency to approve the 2017 Annual Funding Group.

[00:19:06] Speaker 04:
You still win if 933 requires the agency to approve the 2017 Annual Funding Group, right?

[00:19:15] Speaker 03:
That's correct.

[00:19:17] Speaker 03:
But I want to emphasize

[00:19:22] Speaker 03:
on the job when 933 was promulgated, we think that that regulation says what it says because that's what the statute requires.

[00:19:32] Speaker 03:
All right, thank you.