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Hobbs Straus successfully defended a former casino workers’ suit against a Tribe in a Tenth Circuit case finding absence of federal jurisdiction over non-Indian contract and tort disputes arising in Indian country. (2009)

General Memorandum 12-091

General Memorandum 12-091
Surface Transportation Authorization Enacted for FYs 2013 and 2014; Current Authorization Extended Through FY 2012

On July 6, 2012, President Obama signed PL 112-141, the Moving Ahead for Progress in the 21st Century Act (MAP-21) which authorizes surface transportation programs from fiscal year (FY) 2013 through FY 2014 and extends the current surface transportation law: the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU, PL 109-59) through the remainder of FY 2012. Under MAP-21, the funding level for the newly established Tribal Transportation Program (TTP) will be $450 million, which is the same level that the Indian Reservation Roads (IRR) Program was funded at in SAFETEA-LU. These funds, however, will now be stretched to cover two additional programs: the IRR Bridge Program and a tribal safety program. Also, MAP-21 establishes a new tribal shares funding formula, which will be gradually implemented over several years and largely replace the regulatory formula used under SAFETEA-LU (which was developed through the negotiated rulemaking process). Although MAP-21 includes some improvements for tribal programs, many non-funding formula provisions supported by tribes were not adopted, including a provision which would have created a tribal Self-Governance program for the Department of Transportation (DOT).

Finally, we report on two non-transportation provisions included in MAP-21: the interest rate for federally subsidized student loans and a study on tribal government and tribal member participation in the National Flood Insurance Program.

Overall Funding Levels and Program Structure

A signature aspect of MAP-21 is the consolidation of federal programs, and this holds true for the Indian programs. The IRR Program, the IRR Bridge Program, and a new tribal safety program are now consolidated under the new TTP. Under SAFETEA-LU, IRR was funded at $450 million for fiscal year 2011 and the IRR Bridge Program was funded separately at $14 million. Under MAP-21, the TTP program will be funded annually at $450 million; however, up to two percent of that funding will be set aside for the bridge program, and an additional up to two percent will be set aside for the new safety program – effectively resulting in an up to four percent cut in funding. In addition, the administrative "take down" remains capped at six percent. Congress did not reduce the administrative take down or adopt funding increases to the TTP, which were supported by tribes.

On the other hand, MAP-21 includes a provision that exempts TTP funds from the obligation limitation, meaning that 100 percent of TTP funds will be available. The IRR program was subject to the obligation limitation under SAFETEA-LU, which resulted in millions of IRR dollars being diverted each year. Tribes advocated strongly for this exemption and it represents an important achievement. Also of importance, MAP-21 provides $30 million each fiscal year ($25 million via formula, $5 million via competitive grants) for Public Transportation on Indian Reservations. Prior to MAP-21, the tribal transportation program received only $15 million per fiscal year distributed entirely via competitive grants.

MAP-21 makes a significant change to the Tribal High Priority Program (HPP). The tribal HPP was a regulatory set-aside under SAFETEA-LU. Essentially the same program is now established by statute in MAP-21, but it is authorized for $30 million per fiscal year from the General Treasury rather than funded through the Highway Trust Fund. Therefore, it will be subject to the yearly appropriations process and may not be fully funded. Unfortunately, FY 2013 funding for the Tribal HPP is in jeopardy because the House and Senate Appropriations Committees already approved their respective Transportation, Housing, Urban Development and Related Agencies FY 2013 appropriations bills, before the creation of this new Tribal HPP program. Thus, these FY 2013 appropriations bills do not currently include any funding for the Tribal HPP program. Tribes supporting this program are advised to immediately approach Senator Murray (Chair of Senate Transportation, Housing, Urban Development, and Related Agencies Appropriations Subcommittee) and Senator Inouye (Chair of the Senate Appropriations Committee) to seek an amendment to the Senate bill to provide the $30 million for this program.

Funding Formula

Under MAP-21 a portion of the tribal shares distributed under the TTP will be distributed via the new statutory funding formula, and the regulatory formula used under SAFETEA-LU will be gradually phased out The formula in the Senate-passed version of MAP-21 was weighted very heavily on tribal population. However, it was modified in conference committee, and the formula in the enacted version of MAP-21 reduces the weight attributed to tribal populations. A portion of tribal shares will now be distributed on the basis of average funding levels received by tribes in FY 2005 – 2011 under the old relative needs distribution formula (RNDF) and population adjustment factor. As noted above, the new tribal shares formula will be phased in over time according to the following schedule (even though the law only provides funding through FY 2014):

FY 2013 – 80 percent via RNDF, 20 percent via new formula
FY 2014 – 60 percent via RNDF, 40 percent via new formula
FY 2015 – 40 percent via RNDF, 60 percent via new formula
FY 2016 – 20 percent via RNDF, 80 percent via new formula

The funds distributed under the new formula will be calculated using the following three factors:

• 27 percent based on a tribe's total "eligible road mileage" as a percentage of the total "eligible road mileage" for all tribes

• 39 percent based on a tribe's total population as a percentage of the total population of all American Indians and Alaska Natives

• 34 percent divided equally among the BIA Regions and distributed within each Region on the basis of the average funding available to a tribe from FYs 2005-2011 (under the RNDF and population adjustment factor) compared to the average total funding available to all tribes in the Region for that period.

Finally, Tribal Supplemental Funding (TSF) is available to provide additional money to tribes who receive less under the new formula than they received under the RNDF in FY 2011. Under MAP-21, if total TTP funding is less than or equal to $275 million, 30 percent is set aside for TSF. However, if total TTP funding is greater than $275 million, $82.5 million plus 12.5 percent of funds over $275 million is set aside for TSF.

Non-Funding Formula Provisions

Tribes and the NCAI-Intertribal Transportation Association Joint Task Force also advocated for a number of non-funding formula tribal consensus provisions, several of which were included in the version of the transportation bill reported by the House Transportation and Infrastructure Committee. Unfortunately, many of these did not make it into the enacted version of MAP-21. Most noticeably absent from MAP-21 is a provision that with bipartisan support was included in the House Committee's bill which would have would have created a tribal Self-Governance program for the Department of Transportation (DOT).

Other provisions of note in MAP-21 include:

• A revision to the emergency relief program which includes authority for the Secretary of Transportation to directly fund tribal governments independently or in cooperation with another federal or state agency

• Tribal safety funds allocated on tribal government applications for eligible projects on basis of highway safety issues and opportunities on tribal land, as determined by the Secretary of DOT

• Maintenance allowance will be available to tribes of up to 25 percent or $500,000 of TTP funds – whichever is greater

• Tribally owned and federally owned bridges must be included in a bridge and tunnel inventory and classification conducted by the Secretary of Transportation and will be subject to new inspection standards for bridges and tunnels and reporting requirements

• The establishment of Federal Lands Access Program which appears to include the current Public Lands Discretionary Program through which tribes received funding to construct, rehabilitate and maintain certain federal facilities on or adjacent to or which provide access to federal lands. (Tribes are eligible to contract with a federal agency under the new program; however all funding is allocated to states making tribal access unclear.)

• Tribes become eligible to enter into a contract with a federal agency regarding activities funded through the Federal Lands Transportation Program, which funds activities of federal land management agencies

• The establishment of a Transportation Alternatives program which incorporates recreational trails, safety routes to schools, and other alternative programs. (Tribes are eligible to receive competitive grants under this program; however, all funding is distributed to the states.)

Several sections of MAP-21 are intended to reduce the environmental review requirements for transportation projects. These include the requirement for new regulations to create new categorical exclusions from the requirements for environmental assessments and environmental impact statements including:

• The repair or replacement of a highway or bridge damaged by an emergency if the activity is in the same location, capacity and design as the original project, and it commences within two years

• Projects that are located within an operational right-of-way

• Projects receiving less than $5 million in federal funds, or which have a total estimated cost of not more than $30 million (of which less than 15 percent is comprised of federal funds)

Non-Transportation Provisions

Student Loan Interest Rate. MAP-21 extends, for one year, the 3.4 percent interest rate for new federally-subsidized, undergraduate loans. If this extension had not been granted, interest rates for new loans, pursuant to the 2007 College Cost Reduction Act (PL 110-84), would have increased to 6.8 percent on July 1, 2012.

MAP-21 also makes changes to loan eligibility and interest accrual requirements. Under the Act, a person will lose eligibility for subsidized undergraduate loans after one and one half times the published length of their education program, and interest will begin accruing regardless of a person's enrollment status. Thus if a person was enrolled in a four year program, he would lose eligibility for these loans in six years at which time interest would begin to accrue. These provisions apply to persons who are new borrowers on or after July 1, 2013. Under the previous law interest does not accrue as long as a student is enrolled at least half time.

Flood Insurance Program. MAP-21 reauthorizes the National Flood Insurance Program (NFIP), makes changes that attempt to make it actuarially sound, and provides for distribution of penalty funds resulting from the 2010 Deepwater Horizon oil spill. The NFIP, administered by the Federal Emergency Management Agency, offers flood insurance for persons and businesses in those communities that participate in the program. MAP-21 expands the use of Community Development Block Grant (CDBG) funds. It will allow governmental agencies (including tribes) that are in the NFIP and managing flood plain management activities to use CDBG funds to encourage and facilitate the purchase of flood insurance protection by owners and renters in such communities and to promote educational activities that increase awareness of flood risk reduction.

The Act notes that only 45 Indian tribes participate in the NFIP and calls for a study to look into this matter. The Act requires the Comptroller General, in consultation with Indian tribes and tribal members, to undertake a study to examine the factors contributing to the current rate of low tribal participation in the program and methods that might encourage increased participation. The study is to be completed within six months of enactment. It is to contain recommendations on how to encourage participation by Indian tribes and tribal members in the NFIP program and to identify legislative changes that might help achieve this end.

Please let us know if we may provide addition information regarding the Moving Ahead for Progress in the 21st Century Act.

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Inquiries may be directed to:
Geoff Strommer (gstrommer@hobbsstraus.com)

Available Documents for Download ( any referenced attachments are included in download )


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