112 Fed. Cl. 353
Fed. Cl.2013Background
- NAHASDA (1996) required HUD to adopt an allocation formula for Indian housing grants based on three factors, including the number of low-income housing units "owned or operated at the time" under pre-NAHASDA contracts.
- HUD, after negotiated rulemaking, defined Formula Current Assisted Stock (FCAS) as units owned/operated as of Sept. 30, 1997, but promulgated 24 C.F.R. § 1000.318 permitting downward adjustment to remove units a tribe no longer legally owned/operated (e.g., conveyed to homeowners).
- HUD later failed to apply § 1000.318 consistently; audits found overpayments and HUD sought recoupment from tribes, prompting litigation.
- A district court (Fort Peck I) held § 1000.318 invalid as inconsistent with the then-text of 25 U.S.C. § 4152(b)(1); the Tenth Circuit reversed (Fort Peck II) viewing the 1997 unit count as a starting point that HUD could adjust.
- Congress amended § 4152(b)(1) in 2008 to specify unit counts as of the October 1 preceding the funding year and explicitly excluded units no longer legally possessed, while allowing certain timely-filed suits to proceed under the pre-amendment law.
- Plaintiffs sued to recover recaptured funds; cross-motions for partial summary judgment raised whether § 1000.318 conflicted with the original statutory text and was therefore invalid.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 24 C.F.R. § 1000.318 conflicts with 25 U.S.C. § 4152(b)(1) by excluding 1997 units from FCAS | The statute’s phrasing ("the number ... owned or operated at the time") is unambiguous and mandates inclusion of all 1997 units without exception | The statute requires allocations "based on" need; using 1997 units as a starting point and adjusting for units no longer owned reasonably reflects current need | Court: statute ambiguous on this point; § 1000.318 is a reasonable construction under Chevron and is upheld |
| Whether the 2008 NAHASDA amendments demonstrate § 1000.318 was inconsistent with the original statute | The amendment adopting language like § 1000.318 shows Congress corrected an earlier statutory violation, evidencing that the regulation had exceeded statutory authority | The 2008 amendments merely clarified longstanding practice and remedied confusion after Fort Peck I; Congress’ later wording confirms the agency’s reasonable interpretation | Court: amendments are consistent with and clarify HUD’s interpretation; do not show § 1000.318 was unlawful when adopted |
| Whether Chevron deference and canons favoring Indians alter the outcome | Plaintiffs urge statutory ambiguity should be resolved for tribes and rely on pro-Indian canons | Defendant invokes Chevron deference to HUD and argues the allocation is zero-sum (conflicting tribal interests), limiting application of pro-Indian canons | Court: applies Chevron, finds agency interpretation reasonable; pro-Indian canon not dispositive because tribes’ interests conflict; declines to adopt plaintiff-favored reading |
Key Cases Cited
- Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984) (framework for judicial review of agency statutory interpretation)
- United Keetoowah Band of Cherokee Indians v. HUD, 567 F.3d 1235 (10th Cir. 2009) (NAHASDA factors must have nexus to tribal need)
- Fort Peck Housing Authority v. HUD, 435 F. Supp. 2d 1125 (D. Colo. 2006) (district court invalidating HUD regulation interpreting § 4152(b)(1))
- Sierra Club v. EPA, 356 F.3d 296 (D.C. Cir. 2004) ("based on" is ambiguous; adjustments can still be "based on" a model)
- Nuclear Energy Inst., Inc. v. EPA, 373 F.3d 1251 (D.C. Cir. 2004) (agency action must be a reasonable implementation of statutory language)
- RadLAX Gateway Hotel, LLC v. Amalgamated Bank, 132 S. Ct. 2065 (2012) (canon that specific governs general when resolving apparent statutory conflicts)
- Landgraf v. USI Film Prods., 511 U.S. 244 (1994) (presumption against retroactive application of statutes)