1.) The Big Bend  Dam is 95 feet high and was completed in September 1966. Each reservation includes about 225,000 acres. Consultant’s Compensation Analysis Differs from the Approach GAO Previously Used for Other Tribes

The approach used by the Crow Creek Sioux and Lower Brule Sioux  tribes’ consultant differed from the approach we used in our prior reports. In  addition, the consultant provided only the highest additional  compensation value, rather than a range of possible additional  compensation from which the Congress could choose. Consultant Used Various Settlement Proposals Rather Than Consistently Using the Tribes’ Final Asking Prices

To arrive at an additional compensation estimate, the consultant did not  consistently use the tribes’ final asking prices when calculating the  difference between what the tribes asked for and what they finally  received. In contrast, the consultant used figures from a variety  of settlement proposals—several of which were not the tribes’ final asking  prices—to estimate additional compensation for damages (including direct  and indirect damages), administrative expenses, and rehabilitation. Lastly, the consultant did not use the tribes’ final asking prices for the  rehabilitation component of the settlement payment. In our view, the  consultant should have used the final rehabilitation figures proposed by  the tribes in 1961—that is, $4 million for the Crow Creek Sioux tribe and  $2.7 million for the Lower Brule Sioux tribe. Consultant Developed a Single Compensation Estimate for Each Tribe, Rather Than a Range of Estimates

In our two prior reports, we suggested that, for the tribes of Fort Berthold,  Standing Rock, and Cheyenne River, the Congress consider a range of  possible compensation based on the current value of the difference  between the final asking price of each tribe and the amount that it  received. In calculating the current value, we used two different rates to  establish a range of additional compensation. Amounts Calculated by GAO Are Similar to the Amounts Received by the Tribes in the 1990s

Using the approach we followed in our prior reports, which was based on  the tribes’ final asking prices, we found that the additional compensation  the Crow Creek Sioux and Lower Brule Sioux tribes received in the 1990s  was either at the high end or above the range of possible additional  compensation. Rather than bringing the Crow  Creek Sioux and Lower Brule Sioux tribes into parity with the other tribes,  the two bills under consideration in the 109th Congress—H.R. 109 and S.  374—would have the opposite effect. As such, should the Congress rely on  our analysis in this report and not provide these two tribes a third round of  compensation, then the additional compensation provided to five of the  seven tribes affected by Pick-Sloan dam projects on the Missouri River  would generally be within the ranges we have calculated. Providing a third round of compensation to the Crow Creek Sioux and  Lower Brule Sioux tribes, in the amounts proposed in the bills, would  catapult them ahead of the other tribes and set a precedent for the other  tribes to seek a third round of compensation. Our analysis does not  support the additional compensation amounts contained in H.R. 109 and S.  374. Notwithstanding the results of our analysis, the Congress will  ultimately decide whether or not additional compensation should be  provided, and if so, how much it should be.
Why GAO Did This Study

From 1946 to 1966, the government constructed the Fort Randall and Big Bend Dams as flood control projects on the Missouri River in South Dakota. The reservoirs created behind the dams flooded about 38,000 acres of the Crow Creek and Lower Brule Indian reservations. The tribes received compensation when the dams were built and additional compensation in the 1990s. The tribes are seeking a third round of compensation on the basis of a consultant's analysis. The Congress provided additional compensation to other tribes after two prior GAO reports in 1991 and 1998 (GAO/RCED-91-77 and GAO/RCED-98-77). For those reports, GAO proposed that one recommended approach to providing additional compensation would be to calculate the difference between the tribe's final asking price and the amount that was appropriated by the Congress and then adjust that difference using the inflation rate and an interest rate to reflect a range of current values. This testimony is based on GAO's report, Indian Issues: Analysis of the Crow Creek Sioux and Lower Brule Sioux Tribes' Additional Compensation Claims ( GAO-06-517 , May 19, 2006). Specifically, this testimony notes that the tribes' consultant did not follow the approach in GAO's 1991 and 1998 reports. The additional compensation amounts calculated by the tribes' consultant are contained in H.R. 109 and S. 374.

What GAO Found

The approach the tribes' consultant used differed from the approach used in prior GAO reports by (1) not using the tribes' final asking prices as the starting point of the analysis and (2) not providing a range of additional compensation. First, in calculating additional compensation amounts, GAO used the tribes' final asking prices, recognizing that their final settlement position should be the most complete and realistic. In contrast, the consultant used selected figures from a variety of tribal settlement proposals. For example, for the rehabilitation component of the tribes' settlement proposals, the consultant used $13.1 million from proposals in 1957, rather than $6.7 million from the tribes' final rehabilitation proposals in 1961. Second, the tribes' consultant calculated only the highest additional compensation dollar value rather than providing the Congress with a range based on different adjustment factors, as in the earlier GAO reports. Based on calculations using the tribes' final asking prices, GAO's estimated range of additional compensation is generally comparable with what the tribes were authorized in the 1990s. GAO determined that the tribes' final asking prices were a reasonable starting point for the calculations, as was the case for the tribes GAO reviewed in two prior reports. By contrast, the consultant estimated about $106 million and $186 million for additional compensations for the Crow Creek Sioux and Lower Brule Sioux tribes, respectively (in 2003 dollars). Rather than bringing the Crow Creek Sioux and Lower Brule Sioux tribes into parity with the additional compensation provided to other tribes, GAO believes that the two bills under consideration in the 109th Congress--H.R. 109 and S. 374--would have the opposite effect. The bills would catapult the Crow Creek Sioux and Lower Brule Sioux tribes ahead of the other tribes and set a precedent for the other tribes to seek a third round of compensation. While our analysis does not support the additional compensation amounts contained in H.R. 109 and S. 374, the Congress will ultimately decide whether or not additional compensation should be provided, and if so, how much it should be.