The Court granted the Navajo Nation’s Motion for Summary Judgment and denied the U.S. Department of the Interior's Cross-Motion for Summary Judgment in case No. 20-cv-1093. The legal framework is established by the Indian Self-Determination and Education Assistance Act (ISDEAA), which allows tribes to enter into self-determination contracts to manage federally operated programs. Tribes must propose contract terms to the Secretary of the Interior, who has 90 days to approve or deny the proposal based on five specific criteria. Upon entering a self-determination contract, tribes receive funding for program expenses and contract support costs through Annual Funding Agreements (AFAs). If an AFA proposal is similar to a prior agreement, it must be approved; otherwise, it may be declined based on the same five criteria. Tribes can challenge a denied AFA in federal court or appeal to the Interior Board of Indian Appeals (IBIA). The Navajo Nation, as a federally recognized tribe, operates a forestry management program under such contracts and requested $737,745 in its proposed Successor Annual Funding Agreement for contract year 2020.
The SAFA proposed revisions to the forest management contract, allowing the Nation to operate a woodlot for public firewood sales and exempting them from certain reporting requirements from the 2019 SAFA. On December 19, 2019, the Secretary denied this proposal, citing the Nation's request for funding beyond contract limits and asserting that the proposed contract could not adequately maintain the SAFA’s subject matter. Following an informal review on January 7, 2020, the Secretary’s representative awarded the Nation $717,736.77 for direct program expenses, determined the 2020 SAFA was not substantially different from the 2019 version, and instructed the parties to negotiate a compliant SAFA while keeping the 2019 version in effect. The Nation's failure to appeal the decision within thirty days rendered it final on March 30, 2020. Subsequently, the Nation filed a complaint alleging noncompliance with the representative's decision and sought judicial relief to compel approval of the 2020 SAFA and funding. On June 10, 2020, the Secretary awarded $740,341.00 for direct program expenses but maintained the 2019 SAFA was still in effect. The Nation contended this was legally improper. The parties later filed cross-motions for summary judgment, with the Nation's argument about funding levels rendered moot due to the Secretary's June award.
The only issue remaining in this case involves whether the Secretary must approve the Nation's proposed language for the 2020 SAFA, as the amount of funding is no longer contested. The Court has subject-matter jurisdiction under 5331(a), which grants original jurisdiction over claims against the Secretary under ISDEAA. The Nation has standing to sue due to limitations imposed by the 2019 SAFA on resource expenditure, constituting a particularized, imminent, and concrete injury.
Pending motions are ready for review. Summary judgment is granted if there is no genuine dispute regarding material facts, as defined by Federal Rule of Civil Procedure 56(a), which states that a material fact can affect the litigation's outcome, and a genuine dispute exists if reasonable jury determination could favor the nonmoving party.
Under ISDEAA, the Secretary is required to approve a proposed AFA within ninety days unless specific grounds for denial are met, as outlined in 5321(a)(2). These grounds necessitate that the Secretary's factual findings are clearly demonstrated and legal conclusions supported by controlling authority. The Secretary's denial of the Tribe's 2020 SAFA, citing that terms could not be properly completed and that funds requested exceeded applicable levels, contradicts earlier conclusions reached by a representative of the Secretary in March 2020. The Secretary has not demonstrated its factual basis or legal support for the denial as required by 5321(a)(2). Additionally, the Secretary incorrectly questions the applicability of 5321(a)(2) in this case. The statute's language indicates a clear obligation for the Secretary to approve unless specific conditions are satisfied, and the only exception for extending the approval period requires the tribe's written consent, implying that no other exceptions exist.
Allowing the Secretary to renegotiate a previously denied proposal would render the statutory requirement under 5321(a)(2) to approve or justify denials virtually meaningless, as established in TRW Inc. v. Andrews. Since the Secretary failed to meet the conditions set forth in the “unless” clause of 5321(a)(2), the statute's “shall” clause mandates approval of the proposed SAFA. The remedies applicable under 5321(a)(2) are relevant here, despite the Tribe's use of the informal conference process. This process is intended to reassess the Secretary's initial denial, which is also governed by 5321(a)(2). The limitations on remedies in initial adjudications typically apply to appeals, and there is no statutory provision extending remedies beyond those specified in 5321(a)(2). The Secretary cannot expand these remedies through regulation, as supported by Alexander v. Sandoval. The Secretary's arguments are unconvincing; the Nation did assert its claims, and since the grounds for the Secretary's denial were legally inadequate, the SAFA is approved by law. The complaint's request for injunctive relief challenges the Recommended Decision, which upheld the prior SAFA. Additionally, the plaintiffs did not plead a common law claim of promissory estoppel or a breach of contract based on previous contracts, making attempts to introduce these claims later impermissible. The Nation did not forfeit its challenge regarding the renegotiation required by the Recommended Decision, as it simultaneously sought enforcement of different aspects of the decision. The Secretary's contention that the Tribe cannot assert an agency action is final while also seeking an injunction against it lacks legal support.
Reliance on a portion of an agency action while disputing another aspect is permissible under the Administrative Procedure Act (APA), which allows for challenges to “agency action” as defined in 5 U.S.C. § 551(13). The Tribe did not forfeit its right to contest the Recommended Decision despite not appealing within thirty days, as the Secretary's interpretation of "final" under 25 C.F.R. § 900.157 mischaracterizes its meaning in the administrative context; "final" signifies a prerequisite for judicial review according to the APA, specifically 5 U.S.C. § 704. An agency action is considered final when it completes the decision-making process and determines rights or obligations, following the precedent established in Bennett v. Spear, 520 U.S. 154 (1997). Congress has defined conditions under which agency actions become "final" and subject to judicial review, as illustrated in 42 U.S.C. § 1395oo(f)(1). Section 900.157 indicates that recommended decisions finalize the Secretary's decision-making and affect tribal rights under their contracts. Additionally, 25 U.S.C. § 5331(a) allows for judicial review of recommended decisions related to claims against the Secretary under the Indian Self-Determination and Education Assistance Act (ISDEAA). The structure of ISDEAA permits tribes to initiate federal district court actions instead of filing administrative appeals. The Nation's challenge to the Recommended Decision is valid under § 5331(a), and since § 5321(a)(1) mandates approval of the Nation's 2020 Successor Annual Funding Agreement, the Secretary is required to approve it. Consequently, the plaintiff's Motion for Summary Judgment is granted, and the government's Cross-Motion for Summary Judgment is denied, with a corresponding order to follow.
