[Senate Report 113-202]
[From the U.S. Government Publishing Office]
Calendar No. 448
113th Congress Report
SENATE
2d Session 113-202
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TO PROVIDE FOR EQUITABLE COMPENSATION TO THE SPOKANE TRIBE OF INDIANS
OF THE SPOKANE RESERVATION FOR THE USE OF TRIBAL LAND FOR THE
PRODUCTION OF HYDROPOWER BY THE GRAND COULEE DAM, AND FOR OTHER
PURPOSES
_______
June 26, 2014.--Ordered to be printed
_______
Mr. Tester, from the Committee on Indian Affairs, submitted the
following
R E P O R T
[To accompany S. 1448]
The Committee on Indian Affairs, to which was referred the
bill (S. 1448) to provide for equitable compensation to the
Spokane Tribe of Indians of the Spokane Reservation for the use
of tribal land for the production of hydropower by the Grand
Coulee Dam, and for other purposes, having considered the same,
reports favorably thereon with an amendment and recommends that
the bill (as amended) do pass.
PURPOSE
The purpose of S. 1448 is to provide fair and equitable
compensation to the Spokane Tribe for the past and continuing
use of tribal lands by the federal government for the
generation of hydropower by the Grand Coulee Dam.
BACKGROUND
Planning for the construction of the Grand Coulee Dam began
during the period from 1927 to 1931, when the Army Corps of
Engineers, at the direction of Congress, investigated the
Columbia River and its tributaries to identify sites at which
dams could be constructed to produce hydroelectric power at low
cost. The Corps recommended that dams be constructed at a
number of sites, including the current site of the Grand Coulee
Dam. The site chosen for the Grand Coulee Dam consisted, in
part, of lands held in trust by the federal government for the
benefit of the Colville and Spokane Tribes.
The Corps recommended that construction of Grand Coulee Dam
be undertaken by local governments or private utilities under
the authority of the Federal Power Act. The Federal Power Act
requires a licensee using Indian lands to pay an annual payment
to the Indian tribe for the use of its land. In 1933, an agency
of the state of Washington was issued a preliminary permit to
construct a dam at the Grand Coulee site by the Federal Power
Commission. Several years later, however, the federal
government assumed control of the project. Federal dam projects
were not subject to the Federal Power Act, and thus the federal
government was not obligated to pay the Spokane or Colville
Tribes an annual payment for use of their lands.
When the Grand Coulee Dam project was federalized, the
federal government recognized that development of the project
affected the interests of the Spokane Tribe and the
Confederated Tribes of the Colville Reservation and that it
would be appropriate for the Spokane and Colville Tribes to
receive a share of revenue from the disposition of power
produced at Grand Coulee Dam. The Act of June 29, 1940,
directed the Secretary of the Interior to provide compensation
to the Colville and Spokane Tribes for the use of the land in
an amount determined by the Secretary to be just and equitable.
Pursuant to that Act, the Secretary paid to the Spokane Tribe,
$4,700, and to the Confederated Tribes of the Colville
Reservation, $63,000.
Recognizing those one time payments were insufficient as
compensation for the use of tribal lands, Congress enacted the
Confederated Tribes of the Colville Reservation Grand Coulee
Dam Settlement Act in 1994, to provide further compensation to
the Colville Tribes for the use of their lands for the Grand
Coulee Dam. The Colville Settlement Act required a payment of
$53,000,000 for past use of the land of the Colville Tribes.
For the continued use of Colville Tribal lands, the Act
provided annual payments of $15,250,000, adjusted annually
based on revenues from the sale of electric power from the
Grand Coulee Dam project by the Bonneville Power
Administration.
While the Spokane Tribe suffered harm similar to that
suffered by the Colville Tribes, Congress did not include the
Spokane Tribe in the 1994 Act. Further, the Spokane Tribe's
claims before the Indian Claims Commission had all been fully
adjudicated, so the Tribe had no mechanism to litigate its
claims regarding the Grand Coulee Dam in federal court. This
bill aims to correct this injustice by finally providing fair
and equitable compensation to the Spokane Tribe.
S. 1448 would provide the Spokane Tribe with a lump-sum
payment for the past use of tribal lands, which are now
submerged under the reservoir created by the Grand Coulee Dam.
Additionally, the bill would provide the Spokane Tribe with
annual payments for the continued use of tribal lands, based on
the sale of hydroelectric power generated by the Grand Coulee
Dam. The Bonneville Power Administration has stated that these
annual payments alone would not necessitate a rate increase for
its utility customers.
SECTION-BY-SECTION ANALYSIS
Section 1. Short title
The Act may be cited as the ``Spokane Tribe of Indians of
the Spokane Reservation Equitable Compensation Act''.
Section 2. Findings
Section 2 states the findings of Congress that support the
need for the Act.
Section 3. Purpose
Section 3 states the purpose of the Act is to provide fair
and equitable compensation to the Spokane Tribe for use of its
lands for the generation of hydropower by the Grand Coulee Dam.
Section 4. Definitions
Section 4 defines the key terms used throughout the Act.
Section 5. Spokane Tribe of Indian Recovery Trust Fund
Section 5 establishes a Trust Fund of $53 million for the
Spokane Tribe to be maintained and invested by the Secretary of
the Interior until the fund is disbursed to the Tribe upon
their request. Section 5 provides that the Tribe must prepare a
plan on how it intends to use funds prior to the Tribe's
request for disbursement of the Fund.
Section 6. Payments by Administrator
Section 6 provides for annual payments to the Spokane Tribe
for continued use of tribal lands, based on the revenues from
the generation of hydroelectric power by the Grand Coulee Dam.
Section 7. Treatment after amounts are paid
Section 7 describes how the Spokane Tribe may use funds
provided under sections 5 or 6 of the Act, and states that
there is no trust responsibility of the Secretary of the
Interior or the Bonneville Power Administrator towards the
funds, once they have been paid to the Tribe.
Section 8. Repayment credit
Section 8 allows the Administrator of the Bonneville Power
Administration a credit against future interest payments owed
to the Secretary of the Treasury.
Section 9. Extinguishment of claims
Section 9 states that upon deposit of the Trust Fund under
section 5 of the Act, all claims the Spokane has or may have
against the United States will be extinguished.
Section 10. Administration
Section 10 states that the Act is not binding or
establishing precedent for other Power Administrations.
LEGISLATIVE HISTORY
S. 1448 was introduced on August 1, 2013, by Senator Maria
Cantwell and Senator Patty Murray. The bill was referred to the
Committee on Indian Affairs. On September 10, 2013, the
Committee on Indian Affairs held a hearing on the bill. On
January 29, 2014, the Committee met to consider the bill. One
substitute amendment was offered, and the bill as amended was
adopted and ordered favorably reported to the Senate by voice
vote.
SUMMARY OF THE AMENDMENTS
Senator Cantwell offered an amendment in the nature of a
substitute. The amendment states that annual payments from the
Bonneville Power Administration to the Spokane Tribe under
Section 6(b) will be offset by reductions in expenditures by
the Administration. The amendment also makes a technical
correction to update a fiscal year citation, necessary due to
the lapse of a fiscal year since the bill's introduction.
COMMITTEE RECOMMENDATION
On January 29, 2014, the Senate Committee on Indian Affairs
held a business meeting to consider S. 1448 and other measures.
Senator Cantwell introduced a substitute amendment, which was
accepted by voice vote. The Committee ordered the bill, as
amended, reported to the full Senate with the recommendation
that it do pass.
COST AND BUDGETARY CONSIDERATIONS
The following cost estimate, as provided by the
Congressional Budget Office, dated April 18, 2014, was prepared
for S. 1448:
April 18, 2014.
Hon. Jon Tester,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 1448, the Spokane
Tribe of Indians of the Spokane Reservation Equitable
Compensation Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Martin von
Gnechten and Kathleen Gramp.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
S. 1448--Spokane Tribe of Indians of the Spokane Reservation Equitable
Compensation Act
Summary: S. 1448 would provide compensation to the Spokane
Tribe of Indians for tribal lands used in the construction of
the Grand Coulee Dam in Washington. The bill would establish
the Spokane Tribe of Indians Recovery Trust Fund and would
require the Bonneville Power Administration (BPA) to make
annual payments to the tribe from receipts generated from the
sale of electricity. CBO estimates that enacting S. 1448 would
increase net direct spending by $56 million over the 2015-2024
period. Because enacting S. 1448 would affect direct spending,
pay-as-you-go procedures apply. Enacting the bill would not
affect revenues.
S. 1448 contains an intergovernmental mandate as defined in
the Unfunded Mandates Reform Act (UMRA) because it would
extinguish the monetary claims of the Spokane Tribe of Indians
against the United States for hydropower revenues and for past
and continued use of the tribe's land. CBO estimates that the
cost of the mandate would not exceed the annual threshold
established in that act ($76 million in 2014, adjusted annually
for inflation).
S. 1448 contains no private-sector mandates as defined in
UMRA.
Estimated cost to the Federal Government: The estimated
budgetary effect of S. 1448 is shown in the following table.
The costs of this legislation fall within budget functions 450
(community and regional development) and 270 (energy).
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By fiscal year, in millions of dollars--
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2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2015-2019 2015-2024
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CHANGES IN DIRECT SPENDING
Spokane Tribe of Indians Recovery Trust Fund
Budget Authority................................. 53 0 0 0 0 0 0 0 0 0 53 53
Estimated Outlays................................ 53 0 0 0 0 0 0 0 0 0 53 53
Effects on BPA
Estimated Budget Authority....................... 11 -11 0 0 0 0 0 0 0 3 0 3
Estimated Outlays................................ 11 -11 0 0 0 0 0 0 0 3 0 3
Total Changes
Estimated Budget Authority................... 64 -11 0 0 0 0 0 0 0 3 53 56
Estimated Outlays............................ 64 -11 0 0 0 0 0 0 0 3 53 56
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Note: BPA = Bonneville Power Administration.
Basis of estimate: For this estimate, CBO assumes that this
bill will be enacted near the end of 2014.
Spokane Tribe of Indians Recovery Trust Fund
S. 1448 would create the Spokane Tribe of Indians Recovery
Trust Fund to provide compensation for land taken from the
tribe by the federal government to build the Grand Coulee Dam.
S. 1448 would require that $53 million be deposited to that
trust fund on the first day of the first fiscal year after
enactment. Under the bill, the Spokane Tribal Business Council
would have 18 months to prepare a plan detailing how the trust
fund would be used before the amounts deposited in the trust
fund, as well as any accrued interest, could be spent.
Payments to certain tribal trust funds that are held and
managed in a fiduciary capacity by the federal government on
behalf of Indian tribes are treated as payments to a nonfederal
entity. As a result, CBO expects that the entire amount
deposited to this trust fund would be recorded as budget
authority and outlays at the time of the deposit. The Secretary
of the Interior would be required to invest the funds in
government securities until those funds are expended by the
tribe.
Budgetary effects on the Bonneville Power Administration
The legislation also would require BPA to make an annual
payment to the Spokane Tribe of Indians. Beginning in 2014 and
extending through 2024, that payment would equal 25 percent of
the annual payment that BPA makes under current law to the
Confederated Tribes of the Colville Reservation. After 2024,
the annual payment to the Spokane Tribe would increase to 32
percent of the payment to the Confederated Tribes. CBO
estimates that payments would total about $5 million annually
until 2024 and then increase to about $8 million. Under the
legislation, those payments would continue as long as
electricity is generated at the Grand Coulee Dam.
Because BPA's operating costs are driven primarily by
market and environmental conditions that are difficult to
control, CBO expects that the agency would not be able to
offset the cost of this bill by reducing operating expenses.
Instead, we anticipate that BPA would increase the rates it
charges customers for electricity to cover that cost.
Therefore, those payments would generally be offset by an
equivalent increase in the revenue collected from customers.
However, because BPA has already set the rates it will charge
customers for electricity through 2015, CBO expects that the
agency would use reserve funds to make payments to the tribe
for 2014 and 2015. CBO expects that BPA would use $11 million
of reserves for payments to the tribe in 2015 and that the
agency would adjust its rates in 2016 to replenish the
reserves. Beginning in 2016, CBO expects that the additional
annual payment would become part of BPA's cost structure and
would be fully offset by an increase in rates for electricity.
Therefore, CBO estimates no net effect of the annual payments
and rate increases after 2016.
In addition, starting in 2024, S. 1448 would reduce BPA's
interest payments to the Treasury by $2.7 million in the years
that BPA makes payments to the tribe. Because those payments
offset direct spending, such reductions would have the effect
of increasing direct spending by $2.7 million a year
indefinitely, starting in 2024.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending or
revenues. The net change in outlays that are subject to those
pay-as-you-go procedures are shown in the following table.
CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR S. 1448, AS ORDERED REPORTED BY THE SENATE COMMITTEE ON INDIAN AFFAIRS ON JANUARY 29, 2014
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By fiscal year, in millions of dollars--
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2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014-2019 2014-2024
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NET INCREASE OR DECREASE (-) IN THE DEFICIT
Statutory Pay-As-You-Go Effect...................... 0 64 -11 0 0 0 0 0 0 0 3 53 56
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Estimated impact on state, local, and tribal governments:
S. 1448 contains an intergovernmental mandate as defined in
UMRA. Upon deposit of funds into the trust for the tribe,
monetary claims against the United States for hydropower
revenues and for past and continued use of the tribe's land
would be extinguished. Eliminating an existing right of action
is a mandate because the right to seek redress and recover
damages beyond what is provided in the bill would be lost.
Based on information from the tribe, CBO expects it is unlikely
that the tribe would pursue such claims. Therefore, CBO
estimates that the cost, if any, of the mandate would not
exceed the annual threshold established in that act ($76
million in 2014, adjusted annually for inflation).
Estimated impact on the private sector: S. 1448 contains no
private-sector mandates as defined in UMRA.
Estimate prepared by: Federal costs: Martin von Gnechten
and Kathleen Gramp; Effect on state, local, and tribal
governments: Melissa Merrell; Effect on the private sector:
Marin Burnett.
Estimate approved by: Theresa Gullo, Deputy Assistant
Director for Budget Analysis.
REGULATORY AND PAPERWORK IMPACT STATEMENT
Paragraph 11(b) of rule XXVI of the Standing Rules of the
Senate requires each report accompanying a bill to evaluate the
regulatory and paperwork impact that would be incurred in
carrying out the bill. The Committee believes that S. 1448 will
have a minimal impact on regulatory or paperwork requirements.
EXECUTIVE COMMUNICATIONS
The Committee has received no communications from the
Executive Branch regarding S. 1448.
CHANGES IN EXISTING LAW
In accordance with subsection 12 of rule XXVI of the
Standing Rules of the Senate, the Committee finds that the
enactment of S. 1448 will not make any changes in existing law.