S1231DEC16

TheWeekInCongress.com

Week Ending December 16, 2005

S.1231 A bill to amend the Indian Self-Determination and Education Assistance Act to modify provisions relating to the National Fund for Excellence in American Indian Education.

BRIEF

The bill would amend the Act in an effort to facilitate self-sufficiency within the National Fund for Excellence in American Indian Education Act in four ways: The first provides seed money to operate for three fiscal years, the second provides for operational expenses, the third appoints a Chief Operating Office to replaces the Secretary of Interior’s current role in that position, and fourth the bill would increase the cap on administrative cost from 10% to 20% next year and then 15% yearly thereafter.

Sponsor: Senator John McCain (R-AZ)

Vote: Passed Senate by Unanimous Consent December 13, 2005.

Cost to the taxpayers: “CBO estimates that implementing this bill would cost $15 million over the 2007-2010 period.”

MORE INFORMATION

History of the Fund. In 2000, Congress amended the Act in Public Law 106-568 and authorized the Secretary of the Interior to establish the Fund as a federally-chartered nonprofit corporation to accept and administer charitable donations furthering educational opportunities of Indian children attending Bureau-funded schools. However, the formal establishment and commencement of operations for the Fund have not been without considerable difficulty.

The Committee received testimony from the Acting Chair of the Fund that after two years, the Secretary hired an Executive Director to initiate establishment of the Fund and appointed a Board of Directors (Board). Another six months passed before the Board was fully installed and held its first meeting in March, 2003.

However, in November, 2002, it was discovered that another private foundation held the legal rights to the official name of the Fund designated in Public Law 106-568. After negotiations for a name-sharing agreement failed between the Board and the private foundation, the Board sought Congressional action to remedy any potential conflicts over the name.

In 2004, Congress enacted Public Law 108-267, the Omnibus Indian Advancement Act of 2000, which changed the original name of the Fund from the `American Indian Education Foundation' to the `National Fund for Excellence in American Indian Education', thereby eliminating the confusion and potential conflict.

The Fund was established in July, 2004, when it officially incorporated, and received its tax-exempt status determination from the Internal Revenue Service in November, 2004, but has yet to become operational.

Operational Limitations. The Committee received testimony that the Board faces significant hurdles in beginning operations. First, under Public Law 106-568, during the first five years after establishment, the Secretary is authorized to provide `in-kind' administrative support to the Fund and provide funds for travel expenses of the Board--all to be reimbursed to the Secretary by the Fund. After five years, the Secretary may provide only

administrative support if space is available and on a reimbursement basis.

In 2004, the Board presented a cooperative agreement to the Assistant Secretary for Indian Affairs for a transfer of $450,000 to the Fund for administrative purposes. The Office of the Solicitor determined that any funding could be used only to reimburse travel expenses of the Board, not for operations. Since no funding was authorized for operational expenses, the Fund currently cannot become operational or begin such activities, such as marketing or soliciting donations, needed to become operational.

In addition, the Secretary is authorized to transfer property donated for the `advancement of the Indian race' under 25 U.S.C. 451 to the Fund, subject to any restrictions on that donation imposed by the donor.

In September, 2004, the Assistant Secretary for Indian Affairs identified approximately $1.6 million in donated funds that could be transferred to the Fund, of which $200,000 were restricted. Despite meeting with Department officials regarding the transfer, the Board has indicated that no funds have been transferred.

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