OST OTRA Annual Tribal Trust Evaluation (TTE) Ewiiaapaayp Band of Kumeyaay Indians

Authorities and Responsibilities Conduct TTE pursuant to 25 CFR 1000.350

Secretary’s Responsibility Conduct annual trust evaluations for each Self-Governance tribe performing trust programs and functions pursuant to each funding agreement Ensure that tribal and individual trust assets and resources are managed in accordance with legal principles and trust standards Determine if trust assets or resources are found to be in imminent jeopardy Identify deficiencies for matters contained in the funding agreement, and recommend corrective actions

Tribe’s Responsibility Fair presentation of trust programs and functions performed under Self- Governance compact in accordance with trust standards in CFR Adopting sound policies Establishing and maintaining effective internal controls Preventing fraud Preserve, protect and manage all fiduciary trust records created and/or maintained by the Tribe during management of trust programs and functions in Title IV Agreement Provide access to all records, plans, and other pertinent documents relevant to trust programs and functions under review Implement corrective actions

OTRA Auditor’s Responsibility Secretary’s representative conducting the evaluation Collect data Review data Review Tribe’s responses Review terms of MYFA Conduct transaction testing Utilize judgment in the assessment of risks, material weaknesses, internal controls, and in make the final Indian Trust Rating and risk rating determinations for each trust program and function in MYFA

OTRA Annual TTE OTRA evaluates -- the Multi-Year Funding Agreement (MYFA); and the administration of trust programs and functions For each Self-Governance program and function – In accordance with 25 CFR § 1000.355.

Procedures Discussions with key personnel Review completed questionnaires/responses for each applicable trust program and function Judgmental selection of trust programs for testing Assess internal controls Assess compliance with Federal laws, regulations and MYFA provisions

OTRA annual TTE included: Verification of Trust Programs Evaluation of Management, Internal, and Program Controls Determine and verify the trust programs performed and managed by the Tribe BIA Regional Office Tribe Generated Trust Asset and Accounting Management System (TAAMS) queries of applicable trust programs to verify trust transaction approval activity Review tribal responses to Trust Evaluation questionnaires Perform verification, rate trust program and functions, and determine overall risk and Indian Trust Rating

OTRA annual TTE includes: [cont’d] Internal control process Conflicts of interest Compliance with trust provision and applicable statutory and regulatory requirements; and Safeguards

Tribal Questionnaires Internal control process Conflicts of interest Compliance with trust provisions and applicable statutory and regulatory requirements Safeguards

Transaction Sample Selection and Compliance Testing Test transactions for compliance with Title 25 CFR

Questionnaire’s Questions Does the Tribe have approval authority waivers to sign Trust transactions without secretarial approval (may be shown in the form of a corporate charter)?   Amount of Tribal Trust Acres. Amount of Beneficiary Trust Acres. Total Reservation acreage under the jurisdiction of the Tribe (include trust, non- trust, and fee lands). Total Tribal Enrollment.

Questions [cont’d] Are there any ongoing investigations or investigations that transpired during the the evaluation period which are related to trust assets? (25 CFR §1000.355(d)(7)) If yes, has a report been issued? If yes, please upload the report. If no, please summarize the investigation in progress and upload applicable documentation. If yes, was a corrective plan created? If yes, was the corrective action plan implemented? If no, please explain what action has been taken thus far and what the Tribe is doing to continue to act on the action plan.

Questions [cont’d] Does the Tribe coordinate with the Lockbox Coordinator at the Regional Office on a quarterly basis to determine if there are any funds in the Suspense Deposit Account (SDA)? (25 CFR §1000.35(d)(7)) If yes, please provide a copy of policy. Are you aware of any instances of fraud, waste or abuse? If yes, please explain.

Questions [cont’d] Are key duties and responsibilities divided or segregated among different people to reduce the risk of error, waste, or fraud, i.e., no one person is allowed to control all key aspects of a transaction? (25 CFR §1000.355(d)(7)) (GAO Internal Control Management and Evaluation Tool) If no, please explain. Did the tribe submit 2 copies of the audit financial statements and single audit report to the Office of Internal Evaluation and Assessment (OIEA)? (Reference MYFA/AFA) If yes, please explain

Questions [cont’d] Does the Tribe have an employee organizational work chart?

Overall Performance Rating Superior – generally, all components are rated superior or satisfactory. Satisfactory – generally, no more than one component rating should be more severely rated than needs improvement. Needs Improvement – generally, a combination of weaknesses exists that may range from moderate to severe, however, the magnitude of deficiencies generally does not cause a component to be rated more severely than needs improvement. Unsatisfactory – generally, the administration and executive management of Indian fiduciary activities exhibit unsafe and unsound practices or conditions.

OST OTRA TTE in Application Objective - to evaluate compliance with the trust provisions of MYFA

TTE determines Tribe’s Trust Programs OTRA TTE objective is to evaluate the trust programs and functions administered by the Tribe pursuant to their MYFA. TTE determines Tribe’s responsibility for Natural Resources Development, including the preparing and maintaining Natural Resource planning documents. Tribe’s trust programs may include as examples: Social Services Forestry Agriculture Program Wildlife & Parks Program Rights Protection

OTRA TTE MYFA Deficiency for OSG to Correct Missing mandatory provisions and required MYFA language The funding agreement is missing language regarding trust responsibilities and mandatory trust evaluation language required by 25 U.S.C. 5363 (b) and 5363 (d) for Funding Agreements.

25 U.S. Code § 5363(b) - Funding agreements, Contents (b) Contents. Each funding agreement shall— (1) authorize the tribe to plan, conduct, consolidate, and administer programs, services, functions, and activities, or portions thereof, administered by the Department of the Interior through the Bureau of Indian Affairs… (3) subject to the terms of the agreement, authorize the tribe to redesign or consolidate programs, services, functions, and activities, or portions thereof, and reallocate funds for such programs, services, functions, and activities, or portions thereof, except that, with respect to the reallocation, consolidation, and redesign of programs described in paragraph (2), a joint agreement between the Secretary and the tribe shall be required; (6) authorize the tribe and the Secretary to reallocate funds or modify budget allocations within any year, and specify the procedures to be used;

MYFA Authority for Redesign / Reallocation Programs, Services, Functions, and Activities Assumed By the Tribe - The Tribe agrees to assume responsibility for the implementation of the programs identified in the attached REPROGRAMMING REQUEST for which funds are transferred to the Tribe. The Tribe’s Budget Categories listed below specify the programs for which program responsibilities are assumed. The Tribe has broad authority to consolidate and redesign the programs and to reallocate funding between programs without further approval from the Secretary unless otherwise indicated in this Agreement. Examples of programs that meet this criteria are: A. Government and administration B. Business and Economic Development C. Natural Resource Development D. Social and Human Services

MYFA Restrictions on Redesign / Reallocation Special Projects or Earmarked Programs, Services, Functions, and Activities - The Tribe is not authorized to redesign or to reallocate funds provided through this Agreement for PSFAs which are subject to special restriction imposed by statute or which are awarded to the Tribe based on a competition or a special identified need. ... Non-recurring PSFA funds are provided on a one-time basis for this year only. The BIA’s Reprogramming documents and OSG’s Authority to Obligate (ATO) award documents will identify funds that are awarded on a one- time-only basis and are not guaranteed to be funded in subsequent fiscal year(s). Examples of programs that meet this criteria are: Housing Improvement Program FAST Act Tribal Transportation Program Tribal Transportation Planning

OTRA TTE Identified “missing” provisions required in 25 U. S. C OTRA TTE Identified “missing” provisions required in 25 U.S.C. § 5363 (d)(l)&(2) Related to the Secretaries trust responsibility for performing annual trust evaluations 1. 25 U .S.C § 5363 (b) Funding Agreements. Contents: "Each funding agreement shall. .. (5) Specify the services to be provided, the functions to be performed, and the responsibilities of the Tribe and the Secretary pursuant to the agreement." 2. 25 U.S. Code § 5363 (d) Funding Agreements. Provisions relating to the Secretary: "Funding agreements negotiated between the Secretary and an Indian Tribe shall include the following provisions (1) to monitor the performance of trust functions by the Tribe through the annual trust evaluation, and (2) for the Secretary to reassume a program service, function, or portions thereof, if there is a finding of imminent jeopardy to a psychical trust asset, natural resources, or public health and safety."

OTRA Recommendations for MYFA The Office of Self Governance ensure the above required mandatory language and provisions are included in all negotiated funding agreements to comply with the requirements in 25 U.S.C. 5363(d)(1) & (2) and 25 U.S.C. 5363 (b)(5).

Tribes’ Response The request of OST to have this language inserted in all funding agreements came to OSG in July 2017. In July 2017 the OSG Negotiation Guidance was released and a significant number of the 125 self governance funding agreements were already negotiated, and many of the MYFA agreements were completed. These agreements have to be sent to the Hill within a set time frame. OST had the opportunity to consult on this issue earlier in 2017, prior to the negotiation time period, in order to add the directive to the Negotiation Guidance prior to April 2017. Instead OST drafted other unrelated provisions for insertion into the self governance funding agreements. Changes in funding agreement language are subject to consultation and that takes places at the Self Governance Conference OST needs to consult with the tribes on this and other issues.

Recommendations for OST OTRA Since July 2017 OTRA is continually raising this issue as a fault or problem for OSG and for self governance tribes. However, the regulation controls and there is no need for the language because the tribes must comply with the regulations and the compacts negotiated. OST does not do annual trust reviews and are out of compliance with the regulation, and such responsibility is not in the self- governance agreements. Some self governance tribes have the OTRA suggested language in their Compacts. OST should prepare suggested language for insertion in the funding agreements that will be negotiated with the tribes as their MYFA is due for negotiation. OST should prepare for tribal consultation in April at the self governance conference with presentations that identify where OST asserts there is necessary language amendments that would analyze both the MYFA and the Compact agreement. OST should prepare its position in negotiation. Only then, would OST be prepared to do annual evaluations per 25 CFR 1000.355.

Recommendations [cont’d] OST should prepare to be part of the OSG negotiation teams OST should fund travel money for OST representatives for in-person participation, and funding sufficient for its ability to be on the phone OST should be ready for the dates for negotiation that are most convenient for the tribes As for the trust programs and functions, OST needs to prepare the documentation for negotiations that permits tribes, OSG and OST to identify the funding that the tribes are receiving and the measure and method to assure the funding and a tribe’s use of funding covers the trust program activities that are practicable within the amount funded.

Natural Resource Development Natural Resources Development example in Ewiiaapaayp Tribe’s TTE The Ewiiaapaayp Tribe issued a Water Management Plan, a Solid Waste Management Plan, and a Forest Management Plan. The TTE determined the BIA is responsible for all other Natural Resources functions, and observed that: The Band has been working on an Integrated Resource Management Plan (IRMP) since 2006, and OTRA in its next evaluation will follow-up on their IRMP to ensure that it is “completed and properly utilized”, and recommends the Tribe “seek assistance from the BIA to ensure timely completion and implementation of the IRMP.”

Ewiiaapaayp Response Trust programs and functions are the trust responsibility of the Secretary. Tribe received one year of funding for IRMP in 2006. Applications for IRMP funding submitted each year are not funded. BIA’s distribution of funds to trust programs and functions by competitive grant (pest management, forest management, solid waste, energy, water resources, IRMP, etc.) require high tribal contributions as a match, limit or prohibit application of indirect cost rates, and restrict use of funds (such as no equipment purchase or no use of funds for current personnel costs). OTRA TTE’s lowering a tribes performance rating due to inability to achieve goals and deliverables of unfunded trust programs and functions is a misreading of SG law and regulation; however, if so, the remedy is tribe’s retrocession of trust program/function to the Secretary and then an audit of the Secretary that would lead to a compliant on the Secretary’s failed trust responsibility.