Cook Inlet Tribal Council v. Mandregan
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Opinion
Emmet G. Sullivan, United States District Judge
I. Introduction
Over twenty-five years ago, the Cook Inlet Tribal Council ("CITC") and the Indian Health Service ("IHS") entered into a self-determination contract pursuant to the Indian Self-Determination and Education Assistance Act ("ISDEAA"). Under this contract, CITC has operated substance abuse programs serving Alaskan Native patients, while IHS provides federal funding to CITC, allowing CITC to administer federal programs and services that IHS would have otherwise provided. In 2014, CITC proposed a contract amendment for additional "contract support costs" funding to account for increased facility support costs, among other costs. IHS declined CITC's proposed amendment in part, stating that CITC receives payment for facility support costs as part of its annual "Secretarial" funding. CITC now appeals IHS' declination decision, bringing suit against Christopher Mandregan, Jr., Alaska Area Director of IHS; Alex Azar,1 Secretary of the Department of Health and Human Services ("HHS"); and the United States of America. At issue is whether the ISDEAA clearly requires that CITC's facility support costs be funded exclusively from the Secretarial amount, or whether CITC's facility support costs may also be funded as contract support costs.
*3Pending before the Court are the parties' cross-motions for summary judgment. Having carefully reviewed the motions and the entire record herein, the Court concludes that CITC's interpretation of the ISDEAA's ambiguous funding provision is reasonable. Therefore, the Court GRANTS IN PART CITC's motion for summary judgment and DENIES the defendants' cross-motion for summary judgment. However, rather than "immediately" compel IHS to approve and fund CITC's proposed contract amendment, the Court VACATES IHS' declination decision and REMANDS the matter to IHS for a determination consistent with this Memorandum Opinion.
II. Background
This case arises out of a dispute regarding the ISDEAA's funding provisions. The ISDEAA authorizes the government and Indian tribes to enter into self-determination contracts, pursuant to which tribes receive federal funding to provide certain services that a federal agency would normally provide. See
CITC challenges IHS' decision to decline CITC's proposed contract amendment in part ("declination decision"). See Compl., ECF No. 1. IHS is an agency within HHS that provides primary health care for American Indians and Alaskan Natives throughout the United States. Defs.' MSJ, ECF No. 15 at 8.3 IHS provides health care by several means, including directly through its own facilities or by contracting with tribes and tribal organizations pursuant to the ISDEAA. Id. at 8-9.
CITC is a "private, non-profit corporation that delivers social, education, employment, training, alcohol treatment, child care, housing assistance, energy assistance and planning services to the Alaska Native people of the Cook Inlet Region." A.R.,4 ECF No. 17-1 at 3. The services it provides to Native Alaskans are funded by the federal government and the state of Alaska. Id. CITC operates under the authority *4of its Board of Directors, which is made up of representatives from eight federally-recognized tribes: (1) the Chickaloon Village Traditional Council; (2) the Native Village of Eklutna; (3) the Kenaitze Indian Tribe; (4) the Knik Tribal Council; (5) the Ninilchik Traditional Council; (6) the Salamatof Tribal Council; (7) the Seldovia Village Tribe; (8) and the Native Village of Tyonek. See id. ; Pl.'s Stmt., ECF No. 13-2 ¶ 1.
CITC has been a "tribal contractor" under the ISDEAA since 1992, Defs.' Stmt., ECF No. 15-1 ¶¶ 1, 2, when it submitted a proposal to IHS to enter into a self-determination contract to provide residential treatment and recovery services at the Alaska Native Alcohol Recovery Center, see A.R., ECF No. 17-2; Pl.'s Stmt., ECF No. 13-2 ¶ 2. IHS accepted the proposal. Pl.'s Stmt., ECF No. 13-2 ¶ 3. In the first year of the self-determination contract, CITC was provided approximately $150,000 in Secretarial funding, which included $11,838.50 for facility-related costs. Id. ¶¶ 3, 4; see also A.R., ECF No. 17-2. Since then, CITC's programs have "expanded substantially ... with most funding coming from increases in congressional appropriations." Pl.'s Stmt., ECF No. 13-2 ¶ 5. Accordingly, its funding increased from about $150,000 in 1992 to approximately $2,000,000 in 2014, including the $11,838.50 IHS has paid annually for facility support costs since 1992. See A.R., ECF No. 11-1 at 2 ($1,943,226 as of April 2014); Pl.'s Stmt, ECF No. 13-2 ¶ 6 ($2,518,559).
By 2013, CITC's facility support costs grew to $479,040, including the $11,838.50 IHS has paid annually since 1992. Pl.'s Stmt, ECF No. 13-2 ¶ 8. On April 11, 2014, CITC requested to amend of its 2014 self-determination contract to add $479,040 in "direct contract support costs associated with facility support." A.R., ECF No. 17-3. In its proposal, CITC argued that its request should be approved because facility support funds are "reasonable costs for activities which must be carried on by CITC as a contractor" pursuant to the ISDEAA. Id. (citing
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Emmet G. Sullivan, United States District Judge
I. Introduction
Over twenty-five years ago, the Cook Inlet Tribal Council ("CITC") and the Indian Health Service ("IHS") entered into a self-determination contract pursuant to the Indian Self-Determination and Education Assistance Act ("ISDEAA"). Under this contract, CITC has operated substance abuse programs serving Alaskan Native patients, while IHS provides federal funding to CITC, allowing CITC to administer federal programs and services that IHS would have otherwise provided. In 2014, CITC proposed a contract amendment for additional "contract support costs" funding to account for increased facility support costs, among other costs. IHS declined CITC's proposed amendment in part, stating that CITC receives payment for facility support costs as part of its annual "Secretarial" funding. CITC now appeals IHS' declination decision, bringing suit against Christopher Mandregan, Jr., Alaska Area Director of IHS; Alex Azar,1 Secretary of the Department of Health and Human Services ("HHS"); and the United States of America. At issue is whether the ISDEAA clearly requires that CITC's facility support costs be funded exclusively from the Secretarial amount, or whether CITC's facility support costs may also be funded as contract support costs.
*3Pending before the Court are the parties' cross-motions for summary judgment. Having carefully reviewed the motions and the entire record herein, the Court concludes that CITC's interpretation of the ISDEAA's ambiguous funding provision is reasonable. Therefore, the Court GRANTS IN PART CITC's motion for summary judgment and DENIES the defendants' cross-motion for summary judgment. However, rather than "immediately" compel IHS to approve and fund CITC's proposed contract amendment, the Court VACATES IHS' declination decision and REMANDS the matter to IHS for a determination consistent with this Memorandum Opinion.
II. Background
This case arises out of a dispute regarding the ISDEAA's funding provisions. The ISDEAA authorizes the government and Indian tribes to enter into self-determination contracts, pursuant to which tribes receive federal funding to provide certain services that a federal agency would normally provide. See
CITC challenges IHS' decision to decline CITC's proposed contract amendment in part ("declination decision"). See Compl., ECF No. 1. IHS is an agency within HHS that provides primary health care for American Indians and Alaskan Natives throughout the United States. Defs.' MSJ, ECF No. 15 at 8.3 IHS provides health care by several means, including directly through its own facilities or by contracting with tribes and tribal organizations pursuant to the ISDEAA. Id. at 8-9.
CITC is a "private, non-profit corporation that delivers social, education, employment, training, alcohol treatment, child care, housing assistance, energy assistance and planning services to the Alaska Native people of the Cook Inlet Region." A.R.,4 ECF No. 17-1 at 3. The services it provides to Native Alaskans are funded by the federal government and the state of Alaska. Id. CITC operates under the authority *4of its Board of Directors, which is made up of representatives from eight federally-recognized tribes: (1) the Chickaloon Village Traditional Council; (2) the Native Village of Eklutna; (3) the Kenaitze Indian Tribe; (4) the Knik Tribal Council; (5) the Ninilchik Traditional Council; (6) the Salamatof Tribal Council; (7) the Seldovia Village Tribe; (8) and the Native Village of Tyonek. See id. ; Pl.'s Stmt., ECF No. 13-2 ¶ 1.
CITC has been a "tribal contractor" under the ISDEAA since 1992, Defs.' Stmt., ECF No. 15-1 ¶¶ 1, 2, when it submitted a proposal to IHS to enter into a self-determination contract to provide residential treatment and recovery services at the Alaska Native Alcohol Recovery Center, see A.R., ECF No. 17-2; Pl.'s Stmt., ECF No. 13-2 ¶ 2. IHS accepted the proposal. Pl.'s Stmt., ECF No. 13-2 ¶ 3. In the first year of the self-determination contract, CITC was provided approximately $150,000 in Secretarial funding, which included $11,838.50 for facility-related costs. Id. ¶¶ 3, 4; see also A.R., ECF No. 17-2. Since then, CITC's programs have "expanded substantially ... with most funding coming from increases in congressional appropriations." Pl.'s Stmt., ECF No. 13-2 ¶ 5. Accordingly, its funding increased from about $150,000 in 1992 to approximately $2,000,000 in 2014, including the $11,838.50 IHS has paid annually for facility support costs since 1992. See A.R., ECF No. 11-1 at 2 ($1,943,226 as of April 2014); Pl.'s Stmt, ECF No. 13-2 ¶ 6 ($2,518,559).
By 2013, CITC's facility support costs grew to $479,040, including the $11,838.50 IHS has paid annually since 1992. Pl.'s Stmt, ECF No. 13-2 ¶ 8. On April 11, 2014, CITC requested to amend of its 2014 self-determination contract to add $479,040 in "direct contract support costs associated with facility support." A.R., ECF No. 17-3. In its proposal, CITC argued that its request should be approved because facility support funds are "reasonable costs for activities which must be carried on by CITC as a contractor" pursuant to the ISDEAA. Id. (citing
CITC appealed this declination decision by filing a complaint on October 31, 2014. Compl., ECF No. 1. The parties filed cross-motions for summary judgment in 2015, which the Court denied without prejudice while the parties engaged in settlement negotiations. See Jan. 4, 2016 Minute Order. After the negotiations failed, the Court granted the parties' motions to reinstate the cross-motions for summary judgment. See June 8, 2016 Minute Order.
III. Standard of Review
Pursuant to Federal Rule of Civil Procedure 56, summary judgment should be *5granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a) ; Waterhouse v. District of Columbia ,
When a tribe appeals a government agency's declination decision under the ISDEAA, as here, the burden of proof rests with the government: "the Secretary shall have the burden of proof to establish by clearly demonstrating the validity of the grounds for declining the contract proposal (or portion thereof)."
Additionally, the ISDEAA and the self-determination contracts formed thereunder "shall be liberally construed for the benefit of the [tribal] Contractor." Ramah Navajo ,
This canon displaces the deference a court would otherwise give an agency's interpretation under Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. ,
IV. Analysis
IHS denied CITC's contract proposal because the "amount of funds proposed ... is in excess of the applicable funding level for the contract." A.R., ECF No. 11-1 at 3. According to IHS, CITC is not entitled to the requested facility support funding because that funding has been included in CITC's "Secretarial amount." See
At issue, then, is whether the ISDEAA clearly requires that CITC's facility support costs be funded exclusively from the Secretarial amount, or whether CITC's facility support costs may also be funded as contract support costs. See generally Pl.'s MSJ, ECF No. 13; Defs.' MSJ, ECF No. 15. In reaching its decision, the Court first discusses the ISDEAA's statutory scheme and the two types of funding provided thereunder. The Court then evaluates whether the statute speaks clearly on the precise question. Concluding that it does not, the Court finds CITC's interpretation of the ambiguous statutory provision to be reasonable, particularly in light of IHS' contradictory guidance, which contemplates that facility support costs may be paid as contract support costs in certain circumstances. Similarly, the Court finds that IHS' interpretation is not compelled by the ISDEAA and may in fact be contradicted by its own regulations and guidance.
A. The Indian Self-Determination and Education Assistance Act
Congress enacted the ISDEAA in 1975 to codify the federal government's "obligation" to "respond to the strong expression of the Indian people for self-determination"
*7and to achieve "maximum Indian participation in the direction of educational as well as other Federal services to Indian communities so as to render such services more responsive to the needs and desires of those communities."
The Secretarial amount is "the amount that the agency would have spent 'for the operation of the program' had the agency itself managed the program." Cherokee Nation of Okla. v. Leavitt ,
As originally enacted, the ISDEAA only required the government to provide Secretarial funding, equivalent to the amount that the Secretary would have otherwise provided. Ramah Navajo , 567 U.S. at 186,
Under the ISDEAA, contract support costs "shall be added" to the Secretarial amount.
an amount for the reasonable costs for activities which must be carried on by a tribal organization as contractor to ensure compliance with the terms of the contract and prudent management, but which-
(A) normally are not carried on by the respective Secretary in his direct operation of the program; or *8(B) are provided by the Secretary in support of the contracted program from resources other than those under the contract.
The contract support costs that are eligible costs for the purposes of receiving funding under this chapter shall include costs of reimbursing each tribal contractor for reasonable and allowable costs of-
(i) direct program expenses for the operation of the Federal program that is the subject of the contract, and
(ii) any additional administrative or other expense related to the overhead incurred by the tribal contractor in connection with the operation of the Federal program, function, service, or activity pursuant to the contract,
except that such funding shall not duplicate any funding provided under subsection (a)(1) of this section [the Secretarial amount].
Whether a cost or "activity" is included in the Secretarial amount or is eligible as a contract support cost is significant because the ISDEAA obligates IHS to fully fund contract support costs. See Ramah Navajo , 567 U.S. at 193-94,
CITC requested $479,040 in contract support costs funding for its facility support costs in a proposal to amend the 2014 self-determination contract. A tribe may propose to amend a self-determination contract by, for example, amending a funding agreement. See
B. Section 5325 of the ISDEAA is Ambiguous
As stated by IHS, "this case raises a novel issue about what activities, and the *9associated costs, are eligible for [contract support costs] funding under the ISDEAA." Defs.' MSJ, ECF No. 15 at 13. The Court must determine whether the ISDEAA clearly requires that CITC's facility support costs be funded exclusively from the Secretarial amount, or whether they may also be funded as contract support costs.
IHS argues that the "plain language" of the ISDEAA "authorizes [contract support costs] funding only for activities normally not carried on by the Secretary ... but that tribes must carry on to ensure compliance with the terms of the contract and prudent management."
CITC responds that facility support costs are eligible to be funded both as Secretarial funding, as a portion of them have been since 1992, and as contract support costs because they are "reasonable and allowable costs" required for the operation of the program. Pl.'s MSJ, ECF No. 13-1 at 1 (quoting
First, the Court must determine whether the provision at issue is ambiguous. If the statute is ambiguous, the Court must construe the ambiguities in CITC's favor. See Chickasaw Nation v. United States ,
The ISDEAA does not clearly answer whether facility support costs may be provided only in the Secretarial amount, pursuant to
*10
The question, then, is what activities are "normally not carried on" by an agency in operating a program.
The "dictionary definition" of "normal" and the "everyday meanings of the term and phrase [as used in the statute]" do not provide clarity, especially given the complexities of federal program funding. See Howmet Corp. v. Envt'l. Prot. Agency ,
IHS argues that the provision is unambiguous because facility support costs are "normally" incurred by an agency in running a treatment program. See, e.g., Defs.' MSJ, ECF No. 15 at 19-20, 26; Defs.' Reply, ECF No. 21 at 2-5. But costs "normally" incurred in running a federal program is not clear or obvious. For example, in responding to CITC's proposed contract amendment, IHS stated that it "accepted all of CITC's proposed direct [contract support costs], with the exception of the ... facility costs." Defs.' MSJ, ECF No. 15 at 5 (citing A.R., ECF No. 11-1). IHS accepted as eligible contract support costs activities that included "training" and "certification" for various treatment professionals. See A.R., ECF No. 11-1 at 6. IHS does not explain why training and certifying treatment staff would not be an activity the Secretary would "normally ... carr[y] on" in operating a treatment center, whereas facility support costs would be. Just as IHS argues that facility support costs are a "normal" cost incurred in operating a treatment program, so too arguably is training and certifying the staff needed to treat patients. There is nothing in the statute that suggests one cost is a *11"normal" program cost, while the other is not. See generally
The Court recognizes that facility support costs were provided in the Secretarial amount when the contract was initially executed in 1992, and that at least a portion of facility support costs have been provided annually in the Secretarial amount since then. Pl.'s Stmt., ECF No. 13-2 ¶ 4; Defs.' MSJ, ECF No. 15 at 18. But IHS does not explain why facility support costs are "normally" incurred by an agency in running a treatment program, nor does it elaborate on other costs that are "normally" incurred by an agency in operating a federal program. C.f. Consumer Fed'n of Am. & Pub. Citizen v. U.S. Dep't of Health & Human Servs. ,
Indeed, the Court discusses IHS' Indian Health Manual ("Manual")-a document created by IHS to provide guidance regarding eligible contract support costs-in further depth below, but one provision provides further support for the Court's conclusion that the funding provision is ambiguous. In defining direct contract support costs, IHS states that "facility support costs" may be eligible as contract support costs "to the extent not already made available." See Indian Health Manual ("IHM") § 6-3.2(D), available at https://www.ihs.gov/ihm/pc/part-6/p6c3/.7 Since IHS itself provides guidance that asserts that facility support costs may also be eligible as contract support costs, the Court is persuaded that the ISDEAA funding provision is ambiguous.8
The ISDEAA's legislative history also supports this conclusion. In 1994, Congress amended the ISDEAA to "more fully define" contract support costs. S. Rep. No. 103-374, at 8 (1994). Congress clarified that "[i]n the event the Secretarial amount ... for a particular function proves to be insufficient in light of a contractor's needs for prudent management of the contract, contract support costs are to be available to supplement such sums." Id. at 9.
While it may well be reasonable to assume that an agency to "normally" incurs facility support costs when operating a treatment center, the Court is not persuaded that Congress has "unambiguously expressed" its intent such that IHS' interpretation is required by the statutory language. Chevron,
*12as CITC argues.
Thus, the Court concludes that the ISDEAA's funding provision is ambiguous: it is "fairly capable of two interpretations," and the tribe's "interpretation is fairly possible." Chickasaw Nation ,
C. CITC's Interpretation is Reasonable in Light of IHS' Guidance
Because the Court finds the provision at issue to be ambiguous, the Court must liberally construe it in CITC's favor. Blackfeet Tribe,
"Although not the only plausible interpretation, [CITC's] interpretation is a reasonable one." Maniilaq Ass'n,
Because "the ISDEAA does not provide any formula or methodology for calculating [contract support costs]," IHS developed the Manual to "provide[ ] guidance to both Tribal and Agency personnel in the preparation and negotiation of requests for [contract support costs]." Defs.' MSJ, ECF No. 15 at 11; see also IHM § 6-3.1. The Manual is not a regulation and is therefore not binding on the agency or the tribes, see IHM § 6-3.1, but it is cited frequently by IHS as evidence that its interpretation is compelled by the ISDEAA, see generally Defs.' MSJ, ECF No. 15. As IHS states, the Manual "provides specific guidance for each category of [contract support costs]" and "provides guidance on whether other specific costs are eligible for [contract support costs] funding." Defs.' MSJ, ECF No. 15 at 12. In fact, the self-determination contract between CITC and IHS incorporates the Manual to the extent it is not inconsistent with the ISDEAA. A.R., ECF No. 11-1 at 21 § (2)(7)(A) (contract support costs shall be "recalculated as necessary to reflect the full [contract support costs] required [under the ISDEAA] ... as specified in the IHS Manual Part 6, Chapter 3.").
The Manual contemplates that facility support costs may be eligible for contract support costs funding. It defines direct contract support costs as described in the statute,
*13IHM § 6-3.2(D)(1)(e). Included in the list of eligible examples is "facility support costs to the extent not already made available."
The Manual therefore suggests that facility support costs may be funded as both Secretarial funding and contract support costs funding, so long as there are no duplicate payments. For example, in a Manual exhibit describing IHS' "standards for review and approval of contract support costs," IHS elaborates that "rent/utilities" are "generally ... not included in the [direct contract support costs] requirement." IHM Ex. 6-3-G § C. It clarifies that facility support costs are eligible as contract support costs in "extremely rare circumstances when the awardee did not receive the funds in the Section 5321(a)(1) [Secretarial funding] amount."
In sum, the Manual-a document created by IHS to provide instructional guidance regarding an ambiguous statutory provision-separately states that facility support costs can be provided as: (1) "direct" contract support costs funding; (2) "indirect-type" costs normally eligible for contract support costs funding; and (3) "generally" included in the Secretarial amount. See IHM §§ 6-3.1, et. seq. ; IHM Ex. 6-3-G. Given this contradictory guidance, and construing all ambiguities in CITC's favor, CITC's interpretation that facility support costs may also be funded as contract support costs to the extent not already provided is imminently reasonable. See also Maniilaq Ass'n ,
D. IHS' Interpretation is Not Compelled by the ISDEAA
IHS argues that its declination decision was compelled by the ISDEAA. First, IHS highlights the Manual language that "rent/utilities" are only eligible as direct contract support costs in "extremely rare circumstances." See, e.g. , Defs.' MSJ, ECF No. 15 at 17 (quoting IHM Exhibit 6-3-G). However, the Manual suggests that facility support costs could be eligible for contract support costs funding when not otherwise *14made available in the Secretarial amount. As discussed, "facility support costs" may be eligible for direct contract support costs funding "to the extent not already made available." IHM § 6-3.2(D)(1)(e) (listing examples of direct contract support costs and including facility support costs); see also S. Rep. No. 103-374, at 9 (1994) ("[i]n the event the Secretarial amount ... for a particular function proves to be insufficient in light of a contractor's needs for prudent management of the contract, contract support costs are to be available to supplement such sums"). Furthermore, IHS acknowledges that activities that should be included in the Secretarial amount could nonetheless be eligible for contract support funding "upon a showing that the IHS did not actually transfer any funding to the tribe for the related activity." Defs.' Reply, ECF No. 21 at 10, n.28 (discussing the Manual). CITC argues just that: IHS has not transferred funding for facility support costs beyond the $11,838.50 provided annually since 1992. See Pl.'s Reply, ECF No. 18 at 16-18. Thus, the necessary facility support cost funding has not been "made available" and may therefore be eligible as contract support costs funding. See
Second, IHS repeatedly argues that CITC has already received facility support costs funding in its Secretarial amount, Defs.' MSJ, ECF No. 15 at 4, 5, 7; Defs.' Stmt., ECF No. 15-1 ¶ 8, and that if IHS "pa[id] these costs again as [contract support costs], [IHS] would violate [the ISDEAA provision] that prohibits the payment of [contract support costs] for costs already included in the contractor's program funding," A.R., ECF No. 11-1 at 3. The parties do not dispute that CITC was funded $11,838.50 in 1992 for facility support costs, and that the funding was included in the Secretarial amount. Pl.'s Stmt., ECF No. 13-2 ¶ 4; Defs.' MSJ, ECF No. 15 at 18. IHS contends that facility support costs funding has since increased and has been accounted for in CITC's Secretarial amount. Defs.' MSJ, ECF No. 15 at 16-18. IHS fails, however, to cite to any evidence in the record or to otherwise support this assertion. See generally
IHS posits that it is "irrelevant" that it cannot show how much facility funding has been provided to CITC beyond the $11,838.50 provided annually since 1992. Defs.' Reply, ECF No. 21 at 15. The Court disagrees. As discussed at length supra , the Manual provides that facility support costs may be eligible for contract support costs funding to the extent they are not provided in the Secretarial amount. IHM § 6-3.2(D)(1)(e). Accordingly, IHS has not met its burden to establish that facility support costs beyond the $11,838.50 were provided in CITC's Secretarial amount. In fact, the only support that IHS cites in its "Statement of Material Facts Not in Dispute" is CITC's complaint and its own July 7, 2014 letter declining CITC's proposed contract amendment. See Defs.' Stmt., ECF No. 15-1 ¶ 8 (citing Compl., ECF No. 1 ¶¶ 2, 28, 33); see id. ¶ 13 (citing "Exhibit 39 (July 7, 2014 Declination Letter)"). Neither the complaint nor the declination letter *15establishes that CITC's increased facility support costs were provided in the Secretarial amount.
Third, IHS argues that because facility support costs were originally included in CITC's Secretarial amount, these costs must always be included in that amount. Essentially, IHS contends that the ISDEAA clearly mandates that activities may only be funded by one type of funding. See Defs.' Stmt., ECF No. 15-1 ¶ 8; Defs.' MSJ, ECF No. 15 at 18; see also Defs.' Reply, ECF No. 21 at 6, 17. The Court disagrees. The statute, IHS' regulations, and the Manual suggest that activities can be funded both in the Secretarial amount and as contract support costs, so long as the funds are not duplicative. See generally
To illustrate, to "clarify[ ]" eligible contract support costs, the Manual includes guidelines for calculating direct contract support costs. IHM Ex. 6-3-G. To compute the amount required, "the awardee and the IHS must negotiate the total cost ... of the activities to be supported with [contract support cost funding]. After ..., the Agency will deduct any funds that may have been provided to the awardee in the Secretarial amount for this activity to avoid the duplication of costs."
IHS regulations also contradict IHS' third argument. While the regulations do not interpret the funding provision at issue, they do provide that some activities may be funded from multiple sources. For example, a tribe is entitled to compensation and costs related to leases under the ISDEAA. See
Indeed, the ISDEAA provision prohibiting duplicate funding is necessary only because activities may be funded in both the Secretarial amount and as contract support costs. See
Ultimately, IHS' conclusion that all facility support costs must be funded in the Secretarial amount because some have been since 1992 is not "compelled by the statute and the regulations" or even IHS' own guidance. Maniilaq Ass'n ,
E. Remand is the Appropriate Remedy
The Court finds that IHS' declination decision was not clearly required by the ISDEAA, as non-duplicative facility support costs may reasonably be funded as contract support costs. Thus, IHS has not clearly demonstrated that the funds requested are "in excess of the applicable funding level for the contract." See A.R., ECF No. 11-1 at 2-3 (Declination Letter). Mindful of the government's obligation to "clearly demonstrate" the declination criteria,
That leaves only the issue of remedy. Unlike Secretarial funding-which is committed to the agency's discretion, see
CITC asks the Court to reverse IHS' declination decision, declare that CITC's contract amendment proposal is approved, and order immediate injunctive relief by awarding an additional $467,201.5010 in contract support costs funding to CITC's 2014 contract. Pl.'s MSJ, ECF No. 13-1 at 20.
The Court will vacate the Secretary's declination decision but stop short of granting the other specific relief that CITC requests. The ISDEAA authorizes the Court to "order appropriate relief including money damages, injunctive relief ..., or mandamus to compel an officer or employee of the United States, or any agency thereof, to perform a duty ... (including ... to compel the Secretary to award and fund an approved self-determination contract)."
Therefore, the Court will remand CITC's contract proposal to IHS for a decision consistent with this Memorandum Opinion. See Florida Power & Light Co. v. Lorion ,
V. Conclusion
For the reasons set forth above, the Court GRANTS IN PART CITC's motion for summary judgment and DENIES defendants' cross-motion for summary judgment. IHS' declination decision is VACATED. CITC's contract amendment proposal is REMANDED to IHS for a determination consistent with this Memorandum Opinion regarding the amount of facility support costs that should be funded as contract support costs, beginning with the 2014 contract to present. The Clerk of Court is directed to close this case, with such closure being without prejudice to a motion to re-open following further IHS proceedings. A separate Order accompanies this Memorandum Opinion.
SO ORDERED.
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