SUBJECT: Susanville Indian Rancheria

FINAL DECISION ON REVIEW OF

ADMINISTRATIVE LAW JUDGE DECISION

The Indian Health Service (IHS) appealed the December 14, 2001 recommended decision on remand by Administrative Law Judge (ALJ) William E. Hammett regarding IHS's partial declination of the Tribe's proposal to renew its contract to provide health care programs, functions, services and activities (PFSAs) under the Indian Self-Determination Act (ISDA). IHS had originally declined to fund part of the Area Office and Headquarters shares in the Tribe's proposed annual funding agreement (AFA) for 1997 based on section 102(a)(2)(D) of the ISDA, which permits IHS to decline a proposal for funding "in excess of the applicable funding level for the contract, as determined under section 106(a). . . ." In support of the declination, IHS concluded: 1) the proposed Area Office share was excessive because it included funds that IHS should have withheld to pay for administrative functions that cannot be contracted but must be performed by the Area Office; and 2) the proposed Headquarters share was excessive because it included funds for non-recurring costs which IHS should have distributed among tribes on a program formula basis. The ALJ had issued the recommended decision on remand pursuant to my May 29, 2001 decision remanding the parties' original appeal of the ALJ's April 6, 2001 recommended decision in the same matter for further development of the record.

As explained in detail below, although my rationale differs in some respects from the ALJ's, I agree with the ALJ's ultimate conclusion that IHS owes the Tribe the difference between the amount of the Area Office share in the Tribe's proposed contract for 1997 and the amount the Tribe actually received for the Area Office share, and that this amount should be paid out of appropriations for the current fiscal year. In summary, I find that-

• Section 900.32 of 25 C.F.R. prohibits IHS from declining any portion of a proposed successor AFA that is substantially the same as the AFA for the prior year even if the aggregate funding for the proposed successor AFA is not reduced.
  

• Since IHS conceded that the Area Office share in the Tribe's proposed AFA for 1997 was substantially the same as the Area Office share in the Tribe's AFA for 1996, section 900.32 prohibited IHS from declining the proposed AFA with respect to the Area Office share.

• IHS must pay the difference between the proposed Area Office share for 1997 and the amount received by the Tribe for the Area Office share out of funds appropriated for the current fiscal year.
  
  
• The Tribe is not entitled to any interest on the amount owed by IHS. In his recommended decision on remand, the ALJ found that neither the ISDA nor the Tribe's self-determination contract required the payment of interest. Pursuant to 25 C.F.R. � 900.166, this finding is final in the absence of a timely appeal by the Tribe.
  

• I need not decide whether IHS was prohibited from declining the Tribe's proposed AFA for 1997 with respect to the Headquarters share since the Tribe would have no remedy even if it were to prevail on this issue. In his recommended decision on remand, the ALJ found that the Tribe ultimately received at least the same amount of funding for the Headquarters share in 1997 as it received the prior year, so that IHS did not owe the Tribe any additional amount for this share. Pursuant to 25 C.F.R. � 900.166, this finding is final in the absence of a timely appeal by the Tribe.
  

Statutory and Regulatory Background

The ISDA, 25 U.S.C. � 450f et seq., directs IHS to award "self-determination" contracts to Indian tribes to provide programs, functions, services, and activities (PFSAs) for the benefit of Indians that had previously been provided by IHS. ISDA Section 102. Section 102(a)(2) provides that the Secretary of the Department of Health and Human Services (HHS) must approve a tribe's proposal for a self-determination contract unless the Secretary makes one of five specific findings, including a finding that the amount of funds requested exceeds the applicable funding level for the contract as determined under section 106(a). Section 102(a)(2)(D). In such cases, the Secretary is still required to "approve a level of funding authorized under section 106(a)." Section 102(a)(4).

Section 106(a)(1) provides that the amount of funds awarded under a self-determination contract--

shall not be less than the appropriate Secretary would have otherwise provided for the operation of the programs or portions thereof for the period covered by the contract, without regard to any organizational level within the Department of the Interior or the Department of Health and Human Services, as appropriate, at which the program, function, service, or activity or portion thereof, including supportive administrative functions that are otherwise contractible, is operated.

Section 106(a)(3)(B) provides that, during the period that a tribe operates PFSAs pursuant to a self-determination contract, the tribe shall have the option to negotiate with the Secretary, on an annual basis, "the amount of funds that the tribe . . . is entitled to receive under such contract . . . ." Section 106(b)(2) states that the amount of funds "required by subsection (a)" "shall not be reduced by the Secretary in subsequent years" except in certain specified circumstances.⁽¹⁾

The implementing regulations provide in pertinent part that if a tribe's "proposed successor annual funding agreement"-

is substantially the same as the prior annual funding agreement . . . , the Secretary shall approve and add to the contract the full amount of funds to which the contractor is entitled, and may not decline, any portion of a successor annual funding agreement. Any portion of an annual funding agreement which is not substantially the same as that which was funded previously (e.g., a redesign proposal; waiver proposal; different proposed funding amount; or different program, service, function, or activity) . . . is subject to the declination criteria and procedures . . . .

25 C.F.R. � 900.32.

A tribe whose contract proposal has been declined is entitled to a hearing on the record before an ALJ. ISDA Section 102(b)(3); 25 C.F.R. � 900.163. At the hearing, the Secretary has the burden of proof to clearly demonstrate the validity of the grounds for declining the contract proposal. ISDA Section 102(e)(1); 25 C.F.R. � 900.163.

Any party may appeal the ALJ's recommended decision with respect to a declination by IHS to the Secretary of HHS by filing written objections to the ALJ's recommended decision within 30 days after receiving it. 25 C.F.R. � 900.166. The recommended decision becomes final if no party files timely objections. 25 C.F.R. � 900.166. The Secretary has 20 days from the date of receipt of any timely objections to modify, adopt, or reverse the recommended decision. 25 C.F.R. � 900.167. On August 16, 1996, the Secretary delegated the authority to hear such appeals to the Appellate Division of the Departmental Appeals Board. I have been appointed by the Board Chair as the deciding official in this case. I must uphold the ALJ's recommended decision unless I determine that it was based on an error of fact or law.

Factual and Procedural Background

On May 1, 1995, the Tribe entered into a contract under the ISDA to provide various PFSAs to its members for an indefinite period of time. Memorandum in Support of Appellant's Motion for Summary Judgment, dated 5/12/97, Ex. A, at 3. The annualized amounts in AFA #1, which covered the period May 1 - December 31, 1995, were $88,100 for the Area Office share and $34,646 for the Headquarters share.⁽²⁾ Id., Ex. B. AFA #2, which covered the period January 1 - December 31, 1996, included an Area Office share of $88,100 and a Headquarters share of $100,499, some of which was to be paid as non-recurring program formula funds. Id., Ex. C. The Tribe's proposal for the next AFA, for the period January 1 - December 31, 1997, included an Area Office Share of $88,100 and a Headquarters share of $100,499. Id., Ex. F.

In a letter dated January 16, 1997, the Director of IHS's California Area Office advised the Tribe that IHS was partially declining the Tribe's proposal because the amount of funding the Tribe had requested was in excess of the applicable funding level for the contract as determined under section 106(a) of the ISDA. The letter noted the Tribe's position that the partial declination violated section 106(b) of the ISDA, which prohibits the Secretary from reducing the amount required by section 106(a) for subsequent years other than for the reasons set forth in section 106(b)(2). The letter admitted that none of those reasons were applicable, but stated that a partial declination was nonetheless permissible because the amount the Tribe had received in 1996 exceeded the amount required by section 106(a).

Specifically, IHS stated that it had reduced the Tribe's Area Office share to $59,800 because it had determined upon further analysis that the "residual" used to calculate the amount required by section 106(a) was $2,458,400 rather than the $1,700,000 used in negotiating AFA #1 and AFA #2. The residual is an amount that IHS, through its area offices, withholds from ISDA contracts to pay for federal administrative functions that cannot be contracted but must be performed by IHS. IHS used the $2,458,400 figure in determining the Area Office share for the self-determination contracts of all but Susanville Indian Rancheria and one other tribe in the California Area Office.

IHS also stated that the amount required by section 106(a) for the Tribe's Headquarters share was only $40,457. According to IHS, the remaining funds requested by the Tribe represented funds which should be distributed among tribes on a program formula basis because they are for non-recurring costs. IHS stated that since it "would not have spent $100,499 plus all additional program formula funds on the Tribe's program" pursuant to AFA #2, the $100,499 requested for the Tribe's Headquarters share was in excess of the amount required by section 106(a). 1/16/97 declination letter at 4.

Although the Tribe appealed the partial declination, the Tribe elected to carry out the portion of its proposed AFA for 1997 that was approved by IHS. AFA #3, covering the period January 1 - December 31, 1997, provided for an Area Office share of $53,400 and a Headquarters share of $40,457. Appellant's Reply to Appellee's Opposition to Motion for Summary Judgment, dated 6/26/97, Ex. 2. Nevertheless, the total amount paid to the Tribe in 1997 ($1,400,280) was greater than the total amount paid in 1996 ($1,288,076) due to an increase in base funding as well as the payment of non-recurring funds. Joint Stipulation dated 5/23/01, Ex. A.

On April 6, 2001, the ALJ issued a recommended decision reversing the partial declination of the Tribe's proposed AFA for 1997. The ALJ found that the partial declination reduced the amount of both the Area Office and Headquarters shares below their 1996 levels and that this violated section 106(b)(2) of the ISDA and the regulations at 25 C.F.R. � 900.32. IHS appealed this finding. The Tribe appealed the ALJ's further findings that: the Tribe was not entitled to payment of the amount declined for the Headquarters share because IHS had already paid more than the amount requested for the Headquarters share in the Tribe's proposal; the Tribe was entitled to payment of the amount declined for the Area Office share only to the extent that funds were legally available for the year in question; and the ALJ had no authority to assess interest on the amount due.

In its appeal of this recommended decision, IHS argued for the first time that the Tribe's entire appeal of the partial declination should be dismissed as moot since the Tribe experienced no reduction in its aggregate funding level from 1996 to 1997. While the Tribe agreed that there had been no such reduction, it argued that this was not dispositive since the Tribe was entitled to the 1996 amount for each of the discrete funding categories in its 1997 proposal, including the Area Office and Headquarters shares. I remanded the case to the ALJ to take any actions necessary to fully develop the record on this issue and any other issue he deemed appropriate.

In his December 14, 2001 recommended decision on remand, the ALJ held that IHS's aggregate funding argument was not properly considered because it constituted an alternative rationale for the declination which was not set forth in IHS's declination decision and because it was raised too late in the appeals process. The ALJ also held that in any event IHS's aggregate funding argument had no merit. The ALJ affirmed what he described as the "essential holdings" of his initial recommended decision, although he modified that decision in some respects.⁽³⁾ 12/14/01 recommended decision at 17.

On appeal of the ALJ's recommended decision on remand, IHS argued that: IHS's aggregate funding argument was properly raised; the partial declination did not violate section 106(b) of the ISDA or 25 C.F.R. � 900.32; and the current year's appropriation is not available for payment of any amount owed to the Tribe. The Tribe did not appeal the ALJ's recommended decision on remand.

Section 900.32 of 25 C.F.R. prohibits IHS from declining any portion of a proposed successor AFA that is substantially the same as the AFA for the prior year even if the aggregate funding is not reduced.

Although IHS may decline some or all of a tribe's proposal to enter into or renew a contract to carry out PFSAs on the grounds set out in section 102(a)(2) of the ISDA, section 106(b)(2) of the ISDA restricts IHS's authority to decline the proposed funding amount after the first year of a contract regardless of the grounds for the declination. Thus, if IHS's partial declination violated section 106(b)(2) in this case, I need not reach the issue of whether IHS properly declined the Tribe's proposed AFA for 1997 based on section 102(a)(2)(D).

In appealing the declination, the Tribe argued that section 106(b)(2) prohibits IHS from reducing below the prior year's funding levels the amounts of any discrete categories of funding in the proposed contract, including the Area Office and Headquarters shares. IHS took the position that section 106(b)(2) prohibits IHS only from reducing aggregate funding below the amount received in the prior year.⁽⁴⁾ The ALJ concluded that the restriction in section 106(b)(2) "should be read to apply to aggregate funding if the contract only discusses a single aggregate funding amount, but should apply to separate categories of funding if the contract discusses those categories." 12/14/01 recommended decision at 8. The ALJ further concluded that, in this case, "the restriction applies to the specific amounts for the Area Office and Headquarter's tribal shares which are found in sections 2(C) and 2(D) of the 1996 Annual Funding Agreement." Id. at 12.⁽⁵⁾

I need not determine whether this conclusion is erroneous, however. Regardless of the merits of the interpretation of section 106(b)(2) that IHS advanced in this appeal, HHS and the Department of the Interior have promulgated a regulation to implement section 106(b)(2) at 25 C.F.R. � 900.32, and HHS is bound by the terms of that regulation, which are dispositive of this appeal. While IHS seemed to imply that the regulation might be inconsistent with the plain meaning of section 106(b)(2), IHS never argued that I have authority to ignore the regulation as ultra vires.

Section 900.32 is clearly intended to implement section 106(b)(2) of the ISDA since that regulation incorporates by reference the exceptions to the prohibition on the reduction of funding in the statutory provision (although, unlike section 106(b)(2), the regulation is not limited to reductions in funding). As relevant here, section 900.32 provides that "[a]ny portion of an annual funding agreement proposal which is not substantially the same as that which was funded previously . . . . is subject to the declination criteria." (Emphasis added.) This language plainly contemplates that the Secretary may decline a proposed successor AFA only to the extent that it is not substantially the same as the AFA for the prior year and that the Secretary must otherwise approve the proposed AFA. The regulation looks not at whether the proposed AFA as a whole is substantially the same, but at whether portions of the proposed AFA are substantially the same. If a portion of the proposed AFA is substantially the same, it is required to be approved at the prior year's funding level. Moreover, section 900.32 gives the following examples of a portion of a proposed AFA that IHS might determine not to be substantially the same: "a redesign proposal; waiver proposal; different proposed funding amount; or different program, service, function, or activity" (emphasis added). Thus, IHS was required to determine, with respect to both the Area Office share and the Headquarters share, whether that portion of the proposed AFA--including the proposed funding amount--was substantially the same as in the prior year's AFA, and, if so, to approve the proposed AFA with respect to that share, even though the aggregate funding was not reduced.

According to IHS, however, this is not at all the meaning of the regulation. IHS contended that section 900.32 makes a distinction between the PFSAs in a proposed successor AFA and the amount of funding proposed. Specifically, IHS contended that, under the regulation, if the PFSAs are substantially the same, then IHS may not decline the proposed AFA with respect to any of the PFSAs. However, IHS argued, IHS may still decline to provide the amount of funding requested for a portion of the proposed AFA if IHS determines that this amount exceeds "the full amount of funds to which the contractor is entitled" under section 106(a)(1), even if the amount proposed is the same as the prior year's amount. See Transcript of 1/28/02 telephone conference at 6, 11-12.⁽⁶⁾

There is no support in the language of section 900.32 for the dichotomy which IHS suggests. The regulation excepts from the requirement that the Secretary approve a proposed AFA that is substantially the same as the prior AFA "funding increases included in appropriations acts or funding reductions as provided in section 106(b) of the Act." It necessarily follows from this that other changes in funding levels are subject to this requirement. In addition, the sentence requiring the Secretary to "add to the contract the full amount of funds to which the contractor is entitled" also specifies that the Secretary "shall approve" and "may not decline" any portion of a proposed successor AFA that is substantially the same as in the AFA for the prior year. IHS did not persuasively explain how it could approve the proposed Area Office share or Headquarters share while at the same time reducing the funding amount nor why the reduction in funding would not function as a "declination."⁽⁷⁾

I therefore conclude that section 900.32 prohibited IHS from declining any portion of the Tribe's proposed AFA for 1997 if that portion was substantially the same as in the Tribe's AFA #2. IHS conceded that the Area Office share in the Tribe's proposed AFA was substantially the same as the Area Office share under AFA #2.⁽⁸⁾ Accordingly, IHS's partial declination of the Area Office share violated section 900.32 and was invalid.⁽⁹⁾

IHS must pay the $11,300 owed for the Tribe's Area Office share out of funds appropriated for the current fiscal year.

Since IHS was not permitted to decline the Tribe's proposal for 1997 with respect to the Area Office share, IHS owes the Tribe the difference between the amount proposed and the amount already paid for this share. In his initial recommended decision, the ALJ found that "the Tribe should have received an additional $11,300 in Area Office funds in 1997 under the terms of the proposed 1997 AFA." 4/6/01 recommended decision at 17. The ALJ stated, however, that he did not have information regarding "what funds might currently be available," and so directed that "[t]o the extent IHS can still pay the Tribe this amount with funds which are legally available, it should do so." Id. The ALJ also noted the Tribe's request that IHS pay interest which the Tribe asserted had accrued on the amount of the partial declination since January 1, 1997. However, he stated that he considered an award of interest to be an award of damages and that he "lacks the authority to award damages." Id.

The ALJ's recommended decision on remand modified his findings regarding the remedy, concluding that 1) "funds from 1997 are not available to meet any legal obligations IHS may have which arise from this litigation," and 2) IHS must record "the unpaid remainder of the Tribe's 1997 proposal as an obligation under the current appropriation." 12/14/01 recommended decision at 19.⁽¹⁰⁾ The ALJ also rejected the Tribe's argument that the payment of interest would constitute specific performance rather than damages since he found that neither the ISDA nor the Tribe's self-determination contract required the payment of interest, and accordingly reaffirmed his holding that he lacked authority to award damages in the form of interest.⁽¹¹⁾

On appeal, IHS argued that the ALJ erred in finding that IHS should pay the amount owed from funds appropriated for the fiscal year in which the final judgment is rendered. Citing 31 U.S.C.

� 1502(a)(1) (on appropriation accounting) and the General Accounting Office's treatise Principles of Federal Appropriations Law, IHS asserted that it can obligate an appropriation only for payment of expenses properly incurred during the period for which the funds are appropriated or to complete contracts properly made within that period. Thus, IHS argued, an appropriation for a later year "is not available for an expense incurred in FY 1997, prior to its period of availability, or to fund a contract for FY 1997, prior to its period of availability." IHS Objections dated 1/17/02, at 22.

These principles do not require a finding that the ALJ erred in holding that IHS should pay the amount owed from funds appropriated for the fiscal year in which this matter is finally resolved, however. The amount owed does not constitute an expense incurred in fiscal year 1997. Rather, it would constitute an expense incurred in fiscal year 2002 (the year of this decision) to comply with the resolution of an administrative appeals process authorized by statute and regulation. IHS did not explain why it believed the ALJ's finding to this effect was erroneous. Moreover, IHS's position would effectively nullify the protection afforded by the administrative appeals process for declinations since there would be no guarantee of a remedy for a tribe unless the matter were resolved in the tribe's favor in a fiscal year overlapping the contract period at issue.

IHS also argued that the ALJ's holding regarding the availability of appropriations was contrary to his holding that he had no authority to award damages because "an award of monetary relief from any source of funds other than the fiscal year in which the obligation was incurred would constitute money damages rather than specific relief." IHS Objections dated 1/17/02, at 23. Again, IHS misconstrues the nature of any payment it would make pursuant to a successful appeal by the Tribe. As explained above, such a payment is an obligation in the year in which it is made.

Accordingly, I affirm the ALJ's finding directing IHS to pay the amount owed from appropriations for the fiscal year in which this matter is finally resolved. Since my current decision finally resolves this matter, the $11,300 owed to the Tribe for the Area Office share should be paid from IHS's appropriation for fiscal year 2002.

The $11,300 constitutes the full amount due the Tribe for the Area Office share. In his recommended decision on remand, the ALJ found that the Tribe was not entitled to interest on the amount owed by IHS, rejecting the arguments raised in the Tribe's original appeal. Although the ALJ advised the parties of their right to appeal his recommended decision on remand, no appeal was filed by the Tribe, nor did the Tribe even refer to the interest issue in the proceedings on IHS's appeal of the recommended decision on remand. Thus, pursuant to 25 C.F.R. � 900.166, the recommended decision on remand is final with respect to this issue.

Even assuming that IHS's declination of the Headquarters share violated 25 C.F.R. � 900.32, the Tribe would have no remedy.

As noted above, IHS argued that the partial declination of the Tribe's Headquarters share did not violate 25 C.F.R. � 900.32. IHS also argued, however, that even if there was a violation of section 900.32, the Tribe did not suffer any harm as a result because the Tribe was paid more than the amount requested for the Headquarters share in the Tribe's proposal for 1997. I agree.

In his recommended decision on remand, the ALJ found that maintenance and improvement costs are properly included in determining the amount paid by IHS for the Headquarters share, and that IHS paid the Tribe more than the amount of Headquarters share requested in the Tribe's proposed AFA for 1997. Pursuant to 25 C.F.R. � 900.166, this finding is final in the absence of a timely appeal by the Tribe, as is the ALJ's finding that the Tribe is not entitled to any interest on the amount owed by IHS.⁽¹²⁾ The Tribe stated in its response to IHS's appeal that "it disagrees that the M & I funds . . . received by the Tribe in 1997 should count against" the amount of the Headquarters share in the proposed AFA, citing briefing it submitted to the ALJ prior to the issuance of the recommended decision on remand. Tribe's Response to Objections, dated 1/22/02, at 13, n.11, and 16. This argument, however, cannot reasonably be viewed as a timely appeal nor could it be viewed as a reiteration of a prior objection to the ALJ's initial recommended decision. Indeed, the initial recommended decision did not specifically address the issue of whether maintenance and improvement costs should be considered part of the amount paid to the Tribe for its Headquarters share in 1997, but simply concluded that IHS had already paid more than the required amount for this share. 4/6/01 recommended decision at 17. Thus, even if IHS's appeal preserved the Tribe's objections to the initial recommended decision, there was no prior objection to the ALJ's finding on this issue.

Since there was no timely appeal of the ALJ's finding that the Tribe suffered no harm as a result of the partial declination of the Headquarters share, I do not reach the question whether this declination violated section 900.32 (or whether, if there was no such violation, the declination was properly based on section 102(a)(2)(D) of the ISDA).

Conclusion

Based on the foregoing analysis, I sustain the conclusion in the ALJ's December 14, 2001 recommended decision on remand that IHS owes the Tribe $11,300 for the Area Office share in the Tribe's proposed AFA for 1997 that IHS declined in violation of 25 C.F.R.

� 900.32, and that this amount should be paid out of appropriations for the current fiscal year. This is the final administrative determination in this matter.

Donald F. Garrett, Member
Departmental Appeals Board

1. These circumstances are:

(A) a reduction in appropriations from the previous fiscal year for the program or function to be contracted;

(B) a directive in the statement of the managers accompanying a conference report on an appropriation bill or continuing resolution;

(C) a tribal authorization;

(D) a change in the amount of pass-through funds needed under a contract; or

(E) completion of a contracted project, activity, or program[.]

2. A tribe's Headquarters and Area Office shares are used for administrative functions previously provided by the Headquarters and Area Office. IHS Supplemental Brief Re Interpretation of Section 106(a) and (b) of the ISDA, dated 5/22/01, at 10.

3. The modifications are identified below to the extent relevant.

4. As stated above, although the ALJ concluded in his recommended decision on remand that IHS's aggregate funding argument should have been included as a basis for the declination and was raised too late in the appeals process, he nevertheless proceeded to address it in case I were to disagree. I conclude that the aggregate funding argument was properly raised even though I ultimately conclude that this argument is not dispositive of the issues on appeal. IHS need not have set out this argument in the declination in order to raise it in the appeal proceedings since the argument was not a basis for the declination. Instead, the argument directly responded to the Tribe's argument that the declination violated section 106(b)(2) of the ISDA and 25 C.F.R. � 900.32. More significantly, to the extent that a statutory provision may be dispositive of issues on appeal, it must be considered during the administrative appeals process. The procedural guidelines adopted by the Departmental Appeals Board for the conduct of declination appeals should not be applied to limit the Board's authority in a way that might result in the Board's failing to apply an applicable statute and thus reaching a legally erroneous decision.

5. In his initial recommended decision, the ALJ found that IHS's partial declination with respect to the Headquarters share violated 25 C.F.R. � 900.32 but not section 106(b)(2) of the ISDA. In his recommended decision on remand, the ALJ modified this finding, concluding that IHS's partial declination with respect to the Headquarters share violated the statute as well as the regulation.

6. IHS appeared to have made a similar argument before the ALJ, although it was not as fully articulated. The ALJ found IHS's reading of the regulation "unreasonable per se" since it "robs [the regulation] of any meaning at all." According to the ALJ, "the full amount of funds to which the contractor is entitled" is necessarily the amount in the prior AFA. 4/6/01 recommended decision at 14-15.

7. IHS did argue that reading the regulation to preclude a declination "will lead to absurd results" because it will give the Tribe "a windfall, requiring IHS to pay the additional funding, in addition to the substantial increase it received in 1997." IHS's Objection to December 14, 2001 Recommended Decision of Administrative Law Judge (IHS Objections), dated 1/17/02, at 18. To the extent this would represent a windfall (and the Tribe disputed that it would), however, IHS failed to identify any exception in the regulation permitting a declination on this basis.

8. In his initial recommended decision, the ALJ stated that "the parties agree that the proposed 1997 AFA was substantially the same as AFA #2," and concluded that IHS's declination therefore violated section 900.32. 4/6/01 recommended decision, at 14. The ALJ's recommended decision on remand affirmed this conclusion. 12/14/02 recommended decision at 17. In its objections to the latter decision, IHS argued that the Tribe's proposal for the 1997 AFA was not substantially the same as the prior AFA. IHS did not identify any differences between this proposal and AFA #2 with respect to the Area Office share, however (although it pointed to alleged differences in the funding for the Headquarters share). See IHS Objections dated 1/17/02, at 21. IHS subsequently conceded that it had determined that the proposed AFA for 1997 and AFA #2 were not substantially the same with respect to the Headquarters share, but had made no such determination with respect to the Area Office share. Transcript of 1/28/02 telephone conference, at 8.

9. Since it is not necessary to address the merits of the ALJ's statutory interpretation, nothing in this decision should be viewed as either agreeing with the ALJ's analysis of section 106(b)(2) or as suggesting that the regulatory interpretation of section 106(b)(2) is the only permissible interpretation.

10. The recommended decision on remand identifies the difference between the proposed Area Office shares and the amount paid as $20,800 rather than $11,300 as stated in the initial recommended decision. Both parties agreed that $11,300 was the correct amount. IHS Objections dated 1/17/02, at 25; Appellant Susanville Indian Rancheria's Response to Objections Filed by Appellee Indian Health Service to December 14, 2001 Recommended Decision of Administrative Law Judge (Tribe's Response to Objections), dated 1/22/02, at 16. This amount consists of the difference between the $59,800 actually paid by IHS for 1997 and the $88,100 in the proposed AFA for 1997 minus amounts attributable to Youth Regional Treatment Center and Model Diabetes Project funds which were declined and ultimately not appealed.

11. The ALJ nevertheless stated that "[t]o the extent the Tribe has been damaged by loss of interest as a result of that improper declination, its remedy must be found in the federal court system. See 25 U.S.C. � 450m-1(a)." 12/14/01 recommended decision at 21. The statutory provision cited by the ALJ (section 110 of the ISDA) authorizes the district courts to "order appropriate relief including money damages." As indicated above, however, the Tribe had argued that the payment of interest would constitute specific performance rather than damages.

12. Even if the ALJ's recommended decision on remand left open the question of whether a court has authority to award interest in declination appeals, the Tribe would not be entitled to interest on any amount owed by IHS for the Headquarters share. There is no dispute that the amount of the Headquarters share that IHS declined was paid as non-recurring program funds under AFA #2. Since these funds are not subject to the requirements of section 450l(b) of the ISDA regarding the timing of payments under self-determination contracts, the non-recurring funds under AFA #3 were not late payments on which interest could have accrued.