Most Non-Federally Recognized Tribes That Received Federal Funding Were Eligible as Nonprofit Organizations or State-Recognized Tribes

Of the list of about 400 non-federally recognized tribes that we compiled,  we identified 26 that received federal funding for fiscal years 2007 through  2010. Most of the 26 non-federally recognized tribes were eligible for these  funds because of their status as a nonprofit or state-recognized tribe  (24 out of 26). In addition, we found that 14 of the 26 non-federally recognized tribes that  received funding over the 4-year period were state-recognized tribes and  would be eligible to receive funding from programs specifically authorized  to fund state-recognized tribes. Examples of the 24 federal programs that awarded funding to non- federally recognized tribes in the 4-year period and that are authorized to  fund nonprofit organizations that meet all applicable eligibility  requirements include the following:  the Rural Business Enterprise Grants program, administered by the  Department of Agriculture, which has statutory authority to fund public  bodies, including Indian tribes on state reservations, and private  nonprofit corporations for measures designed to finance and facilitate  development of small and emerging private business enterprises,  among other measures;  the Job Opportunities for Low-Income Individuals program,  administered by the Department of Health and Human Services  (HHS), which has statutory authority to enter into agreements with  nonprofits for the purpose of conducting projects that provide  technical and financial assistance to private employers that assist  them in creating jobs for low-income individuals; and  the Retired and Senior Volunteer Program, administered by the  Corporation for National and Community Service, which has statutory  authority to make grants to or contract with nonprofits to support  programs for certain volunteer service projects for senior citizens. As  shown in table 3, the majority of this funding was awarded to a small  number of non-federally recognized tribes. Some of this funding was  awarded to incorporated entities—such as the Lumbee Regional  Development Association—that were created by the Lumbee Tribe of  North Carolina to provide services to the Lumbee Indian community. Most  of the funding (75 percent) awarded to the Lumbee Tribe of North  Carolina was awarded by HUD’s Indian Housing Block Grants program. Specifically, 95 percent of the funding was awarded by seven federal  programs in four agencies. Each of these programs awarded a total of  more than $1.5 million to non-federally recognized tribes during the  period. Agencies Have Funded Some Likely Ineligible Non- Federally Recognized Tribes, and One Agency Is in the Process of Enforcing Single Audit Act Requirements

During our review, we identified some instances where federal agencies  had provided funds to non-federally recognized tribes for which grant  eligibility is disputed and one instance where an agency is trying to  enforce the Single Audit Act’s reporting requirements. Specifically, when  we compared the eligibility requirements for each federal program that  provided funding to non-federally recognized tribes for fiscal years 2007  through 2010 with the characteristics of each entity, we found that  Education funded some non-federally recognized tribes under the  American Indian Vocational Rehabilitation Services Program that appear  to be ineligible and that HHS funded two non-federally recognized tribes  in New Jersey that the state does not consider to be state recognized. HHS Has Taken Some Initial Steps in Response to the Accohannock Indian Tribe’s Noncompliance with the Single Audit Act

The Accohannock Indian Tribe, one of the non-federally recognized tribes  that we identified as receiving federal funds during the period of our  review, did not have an audit or submit a report for 2009 as required by  the Single Audit Act. The entity’s  noncompliance with the Single Audit Act was flagged, and the agency  sent a letter of inquiry to the Accohannock Indian Tribe on March 8, 2011. More recently, after we began inquiring about the issue, the agency  sent the entity an Audit Deficiency Notice via certified mail on February 7,  2012. Nevertheless, Education provided funds  under the American Indian Vocational Rehabilitation Services Program to  state-recognized tribes that were not located on state reservations but rather  had self-defined tribal service areas, raising substantial questions about the  tribes’ eligibility for the funding, and HHS provided funds to two non-federally  recognized tribes in New Jersey as state-recognized tribes that are not  officially recognized by the state. Education’s commitment to review its practices and  take appropriate action is consistent with our revised recommendation. HHS agreed with the two recommendations involving its activities and  stated that it will seek to clarify with the state of New Jersey the status of  the Nanticoke Lenni-Lenape Indians of New Jersey and the Powhatan  Renape Nation. Appendix I: Objectives, Scope, and Methodology

This review’s objectives were to address (1) the key means by which non- federally recognized tribes have been eligible for federal funding and  (2) the amount of federal funding awarded to non-federally recognized  tribes for fiscal years 2007 through 2010, by agency and program.
Why GAO Did This Study

As of January 3, 2012, the United States recognized 566 Indian tribes. Federal recognition confers specific legal status on tribes and imposes certain responsibilities on the federal government, such as an obligation to provide certain benefits to tribes and their members. Some tribes are not federally recognized but have qualified for and received federal funding. Some of these non-federally recognized tribes are state recognized and may be located on state reservations.
GAO was asked to address (1) the key means by which non-federally recognized tribes have been eligible for federal funding and (2) the amount of federal funding awarded to non-federally recognized tribes for fiscal years 2007 through 2010. GAO also identified some eligibility and federal financial reporting issues related to non-federally recognized tribes. GAO compiled a list of about 400 non-federally recognized tribes and reviewed information from federal agencies, USAspending.gov, states, and other sources to identify tribes federal funding and eligibility.

What GAO Found

Of the approximately 400 non-federally recognized tribes that GAO identified, 26 received funding from 24 federal programs during fiscal years 2007 through 2010. Most of the 26 non-federally recognized tribes were eligible to receive this funding either because of their status as nonprofit organizations or state-recognized tribes. Similarly, most of the 24 federal programs that awarded funding to non-federally recognized tribes during the 4-year period were authorized to fund nonprofit organizations or state-recognized tribes. In addition, some of these programs were authorized to fund other entities, such as tribal communities or community development financial institutions.
For fiscal years 2007 through 2010, 24 federal programs awarded more than $100 million to the 26 non-federally recognized tribes. Most of the funding was awarded to a few non-federally recognized tribes by a small number of programs. Specifically, 95 percent of the funding was awarded to 9 non-federally recognized tribes, and most of that funding was awarded to the Lumbee Tribe of North Carolina. Similarly, 95 percent of the funding was awarded by seven programs in four agencies, and most of that funding was awarded by one Department of Housing and Urban Development program.
During the course of its review, GAO identified some instances where federal agencies had provided funding to non-federally recognized tribes for which grant eligibility is disputed and one instance where an agency was in the process of better enforcing federal financial reporting requirements with one tribe. Specifically:
The Department of Education awarded American Indian Vocational Rehabilitation Services Program funding to the United Houma Nation, the Lumbee Tribe of North Carolina, and a consortium consisting of the Choctaw-Apache Tribe of Ebarb and the Four Winds Cherokee. Each of these four tribes is state recognized, but it appears that none of them has a reservation as required by the statute establishing the program. GAO has substantial questions about whether Educations interpretation of the term reservation is broader than the statutory definition supports.
The Department of Health and Human Services (HHS) awarded funding to the Nanticoke Lenni-Lenape Indians of New Jersey and the Powhatan Renape Nationtwo non-federally recognized tribes in New Jerseyunder programs authorized to fund state-recognized tribes. The state of New Jersey, however, does not consider these entities to be state recognized.
HHS has initiated action to enforce federal financial reporting requirements for the Accohannock Indian Tribe. The Accohannock Indian Tribe has not filed its required financial report for 2009 that was due no later than September 30, 2010. In 2009, the Accohannock Indian Tribe reported spending over $1 million in federal funds from three different federal programs administered by the department. The department sent letters of inquiry about the delinquent financial report on March 8, 2011, and more recently, after GAO inquired about the issue, on February 7, 2012.

What GAO Recommends

GAO recommends that Education and HHS take specific actions to ensure that they are not making grants to ineligible tribes and to enforce federal financial reporting requirements. HHS agreed. Education stated its commitment to review its practices, but disagreed with GAOs finding on the statutory eligibility for the American Indian Vocational Rehabilitation Services Program, which is discussed more fully in the report.