October 31, 2014

Tenth Circuit: HHS Required to Contract with Tribe for Self-Determination of Clinic with Full Support Costs

The Tenth Circuit Court of Appeals issued its opinion in Southern Ute Indian Tribe v. Sebelius on Monday, September 19, 2011.

The Tenth Circuit affirmed in part and reversed in part the district court’s decision. This is the second appeal in litigation arising from the Secretary of Health and Human Services’ decision not to enter into a self-determination contract with the Petitioner tribe, to allow them to assume control of a health clinic. In an initial order, the district court ruled that HHS’s decision was unlawful, granted summary judgment to the tribe, and directed the parties to prepare a proposed order for injunctive relief. On remand from the initial appeal, the district court issued a final order, directing the parties to enter a self-determination contract including HHS’s proposed language regarding the contract start date and contract support costs (CSCs), and denying the tribe’s request for damages.

The Court now determines that the Indian Self-Determination and Education Assistance Act (ISDA) “plainly does not authorize HHS to decline the tribe’s contract proposal on the basis that it lacked sufficient appropriations to cover the CSCs requested by the tribe, the amount of which HHS does not contend is unreasonable.” HHS was, therefore, required to contract with the tribe. The Court also found that the tribe “is entitled to a contract specifying the full statutory amount of CSCs . . . subject to the availability of appropriations”; a tribe cannot be forced to enter into a self-determination contract waiving its entitlement to full support costs funding. Lastly, the Court ruled that the ISDA’s model agreement “makes clear that the default start date for a contract is the date on which the contract is approved and executed by the parties“; the tribe in this case did not offer any persuasive authority or rationale to suggest a different rule should apply to their contract.

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