01-6561. Distribution of Fiscal Year 2001 Contract Support Funds

AGENCY:

Bureau of Indian Affairs, Interior.

ACTION:

Notice of method of distribution and use of Fiscal Year 2001 Contract Support Funds.

SUMMARY:

The purpose of this announcement is to provide instructions to Bureau of Indian Affairs (BIA) in carrying out their responsibilities when distributing Contract Support Funds (CSF) for contracts awarded under Public Law 93-638, as amended. The instructions are not regulations to establish program requirements.

DATES:

The CSF Needs Report for ongoing/existing contracts and annual funding agreements are due on July 15, 2001. The CSF Needs Reports for new and expanded contracts and annual funding agreements are due periodically throughout the year as the need arises. All new and expanded contracts and annual funding agreements starting between October 11, 2000 and January 1, 2001, shall be considered to have a January 1, 2001, start date.

ADDRESSES:

Submit the CSF Needs Report to Jim Thomas, Chief, Division of Self-Determination Services, Bureau of Indian Affairs, 1849 C Street, NW., MS-4660-MIB, Washington, DC 20240.

FOR FURTHER INFORMATION CONTACT:

Jim Thomas, [phone].

SUPPLEMENTARY INFORMATION:

A total of $130,485,000 is available for contract support requirements (excluding construction requirements) during FY 2001. Congressional language authorizes the use of $125,485,000 in FY 2001 to pay costs of ongoing/existing self-determination and self-governance awards for programs under contract/compact prior to FY 2001 and $5,000,000 for the Indian Self-Determination Fund (ISD) to be utilized for new and expanded contracts/compacts. Each BIA Regional Office and the Office of Self-Governance (hereinafter office) has the responsibility for tribes located within their respective jurisdiction to work with the tribes in identifying new and expanded contracts and annual funding agreements and reporting this information to the Division of Self-Determination Services as specified in this announcement. CSF shall be added to awards made under section 102 and title IV of the Indian Self-Determination and Education Assistance Act, as amended. Awards made under the authority of section 103 (Grants to Tribal Organizations or Tribes) of the Act shall not receive CSF.

Basis for Payment of CSF

The BIA may only pay indirect costs attributable to program funds included in the BlA's appropriation. Awards by the BIA with funds originating from other agencies which have been transferred to the BIA for award under Public Law 93-638 are not eligible for BIA CSF. Contract support/indirect costs requirements for these awards must be met from within the amounts transferred. (One example would include funds transferred to the BIA from the Department of Transportation for roads construction.) BIA will utilize tribal indirect cost rates to determine the amount of CSF to be paid to contracting tribes and tribal organizations and self-governance tribes and tribal consortia. In determining legitimate indirect cost requirements, each office shall fund only those contracting or compacting tribal organizations that have an approved indirect cost rate or indirect cost proposal currently under consideration by the Office of Inspector General. In those instances where a tribe or tribal organization has more than one approved rate or a current proposal under consideration by the Office of the Inspector General, the office should use the most current rate or pending proposal in determining the amount to award. For tribes unable to negotiate an indirect cost rate because of circumstances beyond their control (i.e., which do not have the administrative capability to negotiate a rate), awarding officials may negotiate reasonable lump sum amounts with these tribes.

Indirect Cost Computation

The following steps must be followed by BIA personnel when computing contract support annual funding requirements:

(1) Determine total current year program funds;

(2) Subtract exclusions (See indirect cost agreements). Examples of exclusions include capital expenditures and pass through funds (those programs requiring minimal administrative effort). Exclude other agency appropriations awarded by the BIA (i.e., Roads Construction funds transferred from the Department of Transportation);

(3) Direct cost base (results of steps 1 and 2);

(4) Multiply indirect cost rate against base determined in step 3;

(5) Results of step 4 equals indirect cost amount at 100 percent;

(6) Multiply current year contract support fund funding percentage against step 5; and

(7) The result of step 6—The amount of current year contract support funds to be added to contracts.

Ongoing/Existing Contracts/Annual Funding Agreements—Method of Distribution

Each office will submit a CSF Needs Report to the Central Office for ongoing contracts and annual funding agreements by July 15, 2001. CSF for Public Law 102-477, contracts and grants awarded under the authority of Public Law 93-638, shall be calculated at the Regional Offices and reported separately when submitting the July 15, 2001, Report. A final distribution of contract support will be made on or about July 31, 2001. CSF will be provided to each office from the remaining based on these reports. If the need reports indicate that $125,485,000 will be insufficient to cover the entire need, the amount available shall be distributed pro rata, so that all contractors and compactors receive the same percentage share of their reported need.

Should the amount of CSF provided for these contracts and annual funding agreements prove insufficient, contracting tribes may use program funds to make up deficiencies necessary to administer their contracts. This tribal reprogramming authority is limited to funds from their Tribal Priority Allocation (TPA), or annual funding agreement. Congressional appropriations prohibits the BIA from reprogramming funds from other Bureau programs to meet any CSF shortfalls.

For other non-TPA programs, tribes may recover full indirect costs from within the overall program funds awarded.

Each office in FY 2001 was provided 85 percent of the total CSF amount which was allotted in FY 2000. From this amount each office should award 75 percent of required contract support to each contract/annual funding agreement to meet the criteria established below.

All contractors and self-governance tribes/consortia with either an approved indirect cost rate, current indirect cost proposal, or FY 2001 approved lump sum amount shall receive 75 percent of the reported need to be paid with the first allotment of CSF in FY 2001. After the second allotment of CSF is made (approximately July 31, 2001) all contractors and self-governance tribes/consortia shall receive a pro rata share of CSF.

An ongoing/existing contract or annual funding agreement is defined as a BIA program operated by the tribal contractor or compactor on an ongoing basis which has been entered into prior to the current fiscal year. An increase or decrease in the level of funding from year-to-year for such contracts or annual funding agreements would not affect the designation of such contracts or annual funding agreements as being ongoing. The assumption of additional BIA program responsibilities would be required to trigger a change in designation.

Indian Self-Determination Fund—New and Expanded Contracts/Compacts and Start-Up Costs

Each office shall submit CSF Need Reports to the Central Office, Office of Tribal Services, for new and expanded contracts and annual funding agreements periodically throughout the year as new contracts or annual funding agreements are awarded or existing contracts or annual funding agreements are expanded. Funds will be provided to the offices as these reports are received and will be taken from the $5,000,000 appropriated. These funds will be distributed on a first-come, first-served basis at 100 percent of the need reported.

In the event the $5,000,000 is insufficient to meet the reported need, new or expanded contracts or annual funding agreements awarded after this fund has been exhausted will not be provided CSF during this fiscal year. Requests received after this fund has been exhausted will be considered first for funding in the following year, if such funds are appropriated.

The Indian Self-Determination Act (Public Law 93-638) defines the term Start-Up Cost (Section 106(a)(5)) as follows:

Subject to paragraph (6) of section 106, during the initial year of a self-determination contract, the amount required to be paid under paragraph (2) shall include startup costs which are reasonable and are incurred on a one-time only basis and are considered necessary to:

(1) Plan, prepare for, and assume operation of the program, function, service, or activity that is the subject of the contract; and

(2) Ensure compliance with the terms of the contract and prudent management.

For specific guidance, including examples of start-up costs, see the BIA website under Tribal Services/Self-Determination Services.

Priority of Funding for New and Expanded Contracts/Annual Funding Agreements

Contract support will be awarded from the ISD fund to all new and expanded contracts/annual funding agreements based on the start date of the award, and the application date, on a first-come, first-served basis. An Indian Self-Determination fund “applicant roster” shall be maintained, which lists, in order of priority, the name of the tribe or tribal organization, the title of the program, the start date, the application date, the amount of program funds, the program cost code(s), the amount of contract support funds required, and the date of approved indirect cost rate agreement or lump sum agreement.

Start date means the date or commencement of operation of the new or expanded portion of the contract or annual funding agreement by a tribe, consortium, or tribal organization. However, because the Self-Determination Act provides that contracts/annual funding agreements will be on a calendar year basis unless otherwise provided by the tribe, any start date on or prior to January 1 of each year shall be considered a January 1 start date.

The application date shall be the date of the request by the tribe which includes:

(1) A tribal resolution requesting a contract or annual funding agreement;

(2) A summary of the program or portion thereof to be operated by the tribe/consortium or tribal organization; and

(3) A summary identifying the source and amount of program or services funds to be contracted or included in an annual funding agreement and contract support requirements. In the event that two tribes or tribal organizations have the same start date and application date, then the next date for determination of priority shall be the date the fully complete application was received by the BIA.

If all of the above are equal, and if funds remaining in the ISD fund are not adequate to fill the entire amount of each award's contract support requirement, then each will be awarded a proportionate share of its requirement and shall remain on the Indian Self-Determination fund roster in appropriate order of priority for future distributions on a first-come, first-served basis, as such funds are appropriated.

A new contract or annual funding agreement is defined as the initial transfer of a program, previously operated by the BIA to the tribe/consortium or tribal organization.

An expanded contract or annual funding agreement is defined as a contract or annual funding agreement which has become enlarged during the current fiscal year through the assumption of additional programs previously operated by the BIA.

Criteria for Determining CSF Need for Ongoing/Existing Contracts/Annual Funding Agreements

CSF for ongoing and existing contracts and annual funding agreements will be determined using the following criteria:

(1) All TPA contracted programs or those programs included in annual funding agreements in FY 2000 and continued in FY 2001, including contracted or annual funding agreement programs moved to TPA in FY 2001.

(2) Direct program funding increases due to inflation adjustments and general budget increases.

(3) TPA programs started or expanded in FY 2001 that are a result of a change in priorities from other already contracted/annual funding agreement programs.

(4) CSF differentials associated with tribally-operated schools that receive indirect costs through the application of an administrative cost grant formula. These differentials are to be calculated in accordance with the criteria prescribed in the Choctaw decision dated September 18, 1992, issued by the Contracting Officer, Eastern Regional Office. Copies of this decision can be obtained by calling the telephone number provided in this announcement.

(5) CSF will be distributed to the Office of Self-Governance for ongoing annual funding agreements, on the same basis as regional offices.

(6) Funds available for Indian Child Welfare Act (ICWA) programs or reprogrammed from ICWA to other programs will be considered ongoing for the purposes of payment of contract support costs.

(7) The use of CSF to pay prior year shortfalls is not authorized.

(8) Programs funded from sources other than those listed above which were awarded in FY 2000 and are to be awarded in FY 2001 shall be considered as ongoing programs.

Dated: March 12, 2001.

James H. McDivitt,

Deputy Assistant Secretary—Indian Affairs (Management).