October 9, 2015

Indian Tribes Have Important November 19 CSC Filing Deadline

The DOI Settlement Funds are Available for Tribes with Self-Determination Contracts and Self-Governance Agreements
Holland & Knight Alert
James T. Meggesto | Philip Baker-Shenk

The U.S. District Court for the District of New Mexico has preliminarily approved a final settlement for the parties in Ramah Navajo Chapter et al. v. Jewell, a class action against the U.S. Department of the Interior (DOI) for its failure to fully fund contract support costs (CSC) necessary to administer various federal programs under the Indian Self-Determination Act from 1994 to 2013.

After nearly 25 years of litigation, the proposed settlement, announced Sept. 16, requires DOI to pay $940 million to resolve more than 600 tribes and tribal entities' claims for shortfalls in CSC funding. The three lawyers for the class seek 8.5 percent of the $940 million – roughly $80 million – in attorneys' fees, plus an estimated $1.5 million in costs, subject to approval by the court.

Distribution Percentages

The settlement assigns each Indian tribe or tribal organization in the class a "distribution percentage" to determine its share of the settlement amount after deduction of attorneys' fees and distribution expenses. Here are the estimated percentage and dollar shares to be distributed for each Indian tribe and tribal organization in the class. Generally, the distribution percentages were determined by a ratio between (a) the amount of CSC that allegedly should have been paid, and (b) the CSC actually paid to each class member during the settlement years, as determined by the U.S. Bureau of Indian Affairs (BIA) payment database and, for fiscal year 2013, the BIA's 2013 Shortfall Report. Class counsel say the ratio is an estimate based on the amount of CSC funding received – those who received comparatively larger amounts of CSC from 1994 through 2012 are slated to receive larger amounts of the CSC shortfall settlement.

In order to determine the amount of CSC that should have allegedly been paid to each tribe in each contract year, class counsel used a random sample of class members for each year from 1994 through 2012. Accountants for each side sampled contract information, independently determined the amount of CSC that should have been paid to them, and calculated the class member's resulting CSC ratio for that year. The statisticians then averaged their independently calculated ratios for each sampled class member, and then averaged the CSC ratios of all sampled class members in that year to produce an overall CSC ratio for each year.

We strongly suggest our tribal clients review the proposed settlement amount and percentage assigned to your tribe or tribal organization with your self-determination contracting personnel and financial officers to determine if the amount proposed is fair. Any tribe that has an objection to the proposed distribution percentages, to the proposed $80 million attorneys’ fee award, or any other form of relief, must file an objection with the Court by Nov. 19, 2015.

If you have any questions or require assistance, please do not hesitate to contact James Meggesto, Philip Baker-Shenk or any other member of our Indian Law Practice Group.


Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.

Related Insights