70 F. Supp. 3d 534
D.D.C.2014Background
- Pyramid Lake Paiute Tribe submitted an ISDEAA contract proposal (received July 8, 2013) to operate an ongoing Fort McDermitt EMS program that IHS had run since 1993. The proposal requested operating, start-up, and indirect costs based on FY2012 expenditures.
- IHS suspended the Fort McDermitt EMS program four days after the local hospital withdrew as the program’s base hospital (August 2013), and on September 30, 2013 declined the Tribe’s proposal.
- IHS’s declination letter rested on two grounds: (1) because IHS had ceased operating the EMS program, the “applicable funding level” was zero making the Tribe’s request excessive under 25 U.S.C. § 450f(a)(2)(D); and (2) the third-party clinic revenues used to subsidize the EMS program were not part of the base funding for contracting.
- The Tribe sued under the ISDEAA seeking an order compelling the Secretary to enter into a self-determination contract; both parties moved for summary judgment and the Secretary moved to dismiss for failure to join other tribes as indispensable parties.
- The court denied the Rule 19 dismissal, reviewed the ISDEAA de novo (applying the Indian canon), and held IHS unlawfully declined the Tribe’s proposal because it did not rely on any enumerated declination criteria as of the date the proposal was received.
- Remedy: the court ordered the Secretary to negotiate with the Tribe to determine the appropriate funding level (what IHS “would have otherwise provided” plus authorized administrative and start-up costs), but did not bind the Secretary to the 2012 dollar amount if that amount was aberrant.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether other regional tribes are indispensable parties under Rule 19 | Other tribes are not legally required parties; Pyramid Lake is authorized to sue for Fort McDermitt | Other tribes have an interest in regional funds and are indispensable; sovereign immunity prevents joinder | Dismissal denied — other tribes not indispensable; Secretary can represent their interests |
| Proper standard of review for IHS interpretation of ISDEAA | De novo review; apply Indian canon (no deference) | Agency/APA deference (Chevron/Skidmore) | De novo review; apply Indian canon, do not defer |
| Whether IHS could decline because it later terminated the program (making "applicable funding" zero) | Decline improper: applicable funding measured as of receipt of proposal; post-receipt cancellation cannot nullify statutory declination criteria | Lincoln and Los Coyotes permit agency to discontinue programs and justify denial | Held for Tribe: applicable funding assessed at date agency received proposal; later cancellation cannot be used to decline under §450f(a)(2)(D) |
| Whether sources IHS used (clinic third-party revenues or "tribal share" budgeting) may be excluded from applicable funding | Tribe: "would have otherwise provided" is what IHS actually spent; third-party subsidies and agency expenditures count toward applicable funding | IHS: may exclude clinic transfers; funding limited to budgeted "tribal share" or be speculative | Held for Tribe: IHS cannot exclude lawful funds used to operate program; ‘‘tribal share’’ or post-hoc budget arguments not permitted when not stated in declination letter and contrary to statute; IHS must base applicable funding on what it would have spent |
Key Cases Cited
- Lincoln v. Vigil, 508 U.S. 182 (1993) (IHS discretion over lump-sum appropriation spending and program continuation)
- Los Coyotes Band of Cahuilla & Cupeno Indians v. Jewell, 729 F.3d 1025 (9th Cir. 2013) (agency may decline proposals to create programs it never operated)
- Ramah Navajo Sch. Bd. v. Babbitt, 87 F.3d 1338 (D.C. Cir. 1996) (ISDEAA limits agency discretion; Indian canon applies)
- Citizen Potawatomi Nation v. Norton, 248 F.3d 993 (10th Cir. 2001) (indispensable party analysis where tribes had contractual funding rights)
- Peyron v. DiMario, 287 F.3d 1121 (D.C. Cir. 2002) (district courts have broad discretion to fashion equitable relief)