ARRA vs. Navajo Nation: Procurement and Indian Preference

1. ARRA vs. Navajo Nation: Procurement and Indian Preference The Navajo Nation wants and needs ARRA funds. What procurement laws, regulations, and policies will we have to follow? Presented by: Luralene D. Tapahe, Assistant Attorney General Economic & Community Development Unit Navajo Nation Department of Justice June 25, 2009

2. ARRA procurement rules and hiring rules are “rules of “general applicability.” • There is nothing specific in the ARRA that tells Indian Tribes that they can or can’t use their own procurement and contracting rules when using ARRA funds for projects. However, there are some general rules that we can examine.

3. ARRA says grantees must comply with: - no casinos, zoos, aquariums, golf courses, swimming pools, or similar projects - publication, transparency, reporting/accounting and registration requirements first reporting deadline is October 10, 2009 and quarterly thereafter - prohibition on comingling of funds; segregation of costs - reporting of false claims - job opportunity posting requirements - buy American-made goods requirement - “competitive bidding” process – the Navajo Nation’s procurement laws and regulations do follow this, but not the Navajo Business Opportunity Act - wage rate requirements – “Davis-Bacon Act” but specific exemption in ARRA for Tribes with IHS, BIA contracts for Tribes and tribal contractors (broader than PL 93-638 - whistle blower protection - Title VI and Title VII of the Civil Rights Act of 1964 - Section 504 of the Rehabilitation Act of 1973 - Title IX of the Education Amendments of 1972, - Age Discrimination Act of 1975 - Americans with Disabilities Act - “non-discrimination” requirements, and other civil rights laws applicable to recipients of federal funds - if ARRA conflicts with NN laws, then ARRA controls

4. Where do Indian Tribes fit in these statutes? Two examples of federal statutes: 1. Title VI – Title VI generally prohibits discrimination against anyone receiving benefits of a federally funded program. There is no specific inclusion or exclusion of Indian Tribes. 2. Title VII - a specific statutory provision is found in Title VII of the Civil Rights Act, which specifically exempts Tribes from the prohibition against discriminatory discharge from employment.

5. With Title VI – some federal courts have found that Tribes do not have to follow the general non-discrimination requirement when they use federal funds for their projects and programs • BIA, IHS, and presumably HUD, will go by their usual Tribal Preference policies when granting ARRA funds under 638 contracts, because the 638 law specifically permits Tribes to give Tribal reference when using federal funds in hiring and in procurement of contracts; PL 93-638 has been found not to violate Title VI, so federal agencies granting funds to the Navajo Nation under the 638 statute routinely permit Navajo Preference. Therefore, the Navajo Nation’s Indian Preference provision under the Navajo Business Opportunity Act and the Navajo Preference in Employment Act does not conflict with federal law whenever 638 contracts are involved.

6. Unfortunately, when the Navajo Nation is dealing with federal agencies other than BIA, IHS, and HUD, we are not under the umbrella of PL 93-638. Therefore, some federal agencies have adopted non-discrimination policies to help them carry out the Title VI and Title VII mandates. Some of these federal agencies have been willing to allow Indian Preference in both tribal hiring and procurement , but some have refused to do this.

7. What can we do about this “hit or miss” situation? Option 1:The Navajo Nation could lobby the White House Intergovt Affairs Office to direct all federal agencies to comply with the broad language in PL 93-638. Section 7(b) of the Indian Self-Determination and Education Assistance Act, Public Law 93–638, 88 Stat. 2205, 25 U.S.C. 450e(b), requires: “Any contract, subcontract, grant, or subgrant pursuant to this Act, the Act of April 16, 1934 (48 Stat. 596), as amended, or any other Act authorizing Federal contracts with or grants to Indian organizations or for the benefit of Indians, shall require that to the greatest extent feasible: (1) Preferences and opportunities for training and employment in connection with the administration of such contracts or grants shall be given to Indians; and (b) Preference in the award of subcontracts and subgrants in connection with the administration of such contracts or grants shall be given to Indian organizations and to Indian-owned economic enterprises as defined in section 3 of the Indian Financing Act of 1974 (88 Stat. 77).” (c) Notwithstanding subsections (a) and (b) of this section, with respect to any self-determination contract, or portion of a self-determination contract, that is intended to benefit one tribe, the tribal employment or contract preference laws adopted by such tribe shall govern with respect to the administration of the contract or portion of the contract.

8. Option 2:The Navajo Nation could try to deal with the administrative staff and attorneys for each federal agency that is not cooperating with the Indian Preference policy, and try to persuade the objecting federal agency to start allowing at least Indian Preference in the Navajo Nation’s procurement of contracts and in its hiring, for projects or programs using ARRA grant monies. But, this will be very time consuming and we might not be successful.

9. Option 3:The Navajo Nation Council could amend Navajo Nation law to be consistent with each federal agency’s regulations and policies that govern the use of ARRA funds given to the Navajo Nation. Note: the ARRA says that if any grant recipient’s law conflicts with the ARRA, then the ARRA controls

10. What would an amendment look like? Policy Statement: • The Navajo Nation Council hereby recognizes the need to obtain potentially hundreds of millions of dollars in federal funds through the American Recovery and Reinvestment Act of 2009 (“ARRA”) for infrastructure and job creation on the Navajo Nation. • The Council further recognizes that each federal agency that will be distributing ARRA grant funds will be governed by its own regulations and policies regarding the use of Indian Preference by ARRA funds recipients in their contract procurement process and hiring procedures when expending ARRA funds.

11. The Council further recognizes that certain federal agencies will not allow for Indian Preference when the Navajo Nation receives ARRA funds and uses such funds in its contract procurement and hiring procedures; and therefore such federal agency rules directly conflict with certain Navajo Nation laws requiring Indian Preference. • The Council further recognizes that there is a serious need to expedite the Nation’s current procurement and hiring process, so that in the future whenever the Nation receives ARRA grant funds, the strict project completion deadlines under the ARRA can be met and the ARRA funds adequately expended in a timely manner, on many projects and programs that are critical for the Navajo Nation and the Navajo People.

12. The Council therefore deems it to be in the best interest of the Navajo Nation and the Navajo People to waive those Navajo Nation laws pertaining to the requirements to give Indian Preference in contract procurement procedures and hiring. • It is the policy of the Navajo Nation Council to enact such waivers only for the limited purpose of complying with federal agency rules regarding non-discrimination and equal opportunity in the use of ARRA funds, and the waivers under this Act shall apply only to those specific provisions of Navajo Nation law that are deemed by the Attorney General of the Navajo Nation to be inconsistent with federal agency rules and regulations that govern the grant of ARRA funds by such federal agencies, or that govern the use of ARRA funds by the Navajo Nation.

13. Proposed statutory language: • “The Navajo Nation Council hereby waives any and all laws pertaining to the procurement of contracts or hiring of employees, whether by the Navajo Nation itself or by any prime contractor of the Navajo Nation, to the limited extent that such laws are determined by the Attorney General of the Navajo Nation to be inconsistent with the laws, rules, or regulations governing the granting of ARRA funds by any federal agency that has provided or will provide such funds to the Navajo Nation, or the use of such funds by the Navajo Nation or the Navajo Nation’s contractors.” • “Such waivers shall apply only to procurement and hiring that will occur as a result of, and that will be funded by, federal ARRA grant monies, whether by reimbursement or direct pay from a federal agency.” • “For purposes of this Act, the term “prime contractor” shall have the meaning described in the Navajo Nation Procurement Act or the Procurement Regulations, and in the Navajo Business Opportunity Act.”

14. Important policy decision:do we want the funds with no speed bumps in the road? • BIA, IHS, and HUD Block Grants are one thing • applying for competitive grants is another thing - all eligible and deserving recipients will be competing for limited funds • our performance in the “first go-round” of the funding grants is going to be key to being considered next time

15. Are you all asleep now?

16. For further assistance, please first contact the particular federal agency from which you are receiving ARRA funds to be sure you are in compliance with their particular rules! . . . and, get it in writing! I can be reached by email at: sqktapahe@yahoo.com or by telephone at: (928) 871-6933 This presentation is intended for discussion purposes and general guidance only, and is subject to revision in accordance with other ARRA and specific federal agency rules. Additional checklists and guidance memos are planned regarding federal agency-wide ARRA procurement rules, policies, and regulations.