Alaska Native Corporations Now Eligible for CARES Act Funds Following Supreme Court Decision

On June 25, 2021, the Supreme Court ruled in a 6–3 decision, in Yellen v. Confederated Tribes of the Chehalis Reservation, that Alaska Native Corporations (ANCs) are “Indian tribes,” as defined by the Indian Self-Determination and Education Assistance Act (ISDA). In accordance with the ruling, ANCs are thus entitled to some of the $8 billion allocated to “Tribal governments” by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) in the wake of the coronavirus pandemic (COVID-19). The decision has a significant impact on CARES Act relief funding to tribal governments and ANCs, but it is unlikely to and is not intended to have broad application.

Congress passed the CARES Act in March 2020 as a means of providing economic stimulus during the economic decline caused by COVID-19. The CARES Act set aside certain relief for “Tribal governments,” which it defined as “the recognized governing body of an Indian tribe.” In turn, the term “Indian tribe,” for purposes of CARES Act eligibility, is defined in the ISDA as “any Indian tribe, band, nation, or other organized group or community, including any Alaska Native village or regional or village corporation as defined in or established pursuant to the Alaska Native Claims Settlement Act,” or ANCSA, “which is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians.” After the CARES Act was passed, the U.S. Department of the Treasury (Treasury) questioned whether the “recognized-as-eligible” clause restricted CARES Act eligibility to federally recognized tribes only. Thus, Treasury asked the U.S. Department of the Interior (Interior), which administers the ISDA, to determine whether ANCs meet the ISDA definition of “Indian tribe.” Interior concluded that ANCs were “Indian tribes,” for purposes of the CARES Act, and Treasury set aside $500 million in CARES Act funds for ANCs as a result.

Following these agency-level determinations, certain federally recognized Indian tribes filed a series of lawsuits, arguing that: (a) ANCs are not federally recognized and, thus, cannot be considered “Indian tribes” under the ISDA or the CARES Act; and (b) ANCs do not have a “recognized governing body” and therefore cannot receive CARES Act funding. The lawsuits were consolidated in the U.S. District Court for the District of Columbia. After initially entering a temporary restraining order and preliminary injunction prohibiting the distribution of funds to ANCs, the district court granted summary judgment in favor of the government and the ANCs, ruling that ANCs qualified as “Indian tribes” under the ISDA. The U.S. Court of Appeals for the District of Columbia Circuit then reversed, holding that ANCs are not federally recognized and, therefore, are ineligible for funds set aside for tribal governments.

On June 25, 2021, the Supreme Court agreed with the district court. Writing for the majority, Justice Sonia Sotomayor noted that ANCs are “established pursuant to the ANCSA” and are “recognized as eligible” for the ANCSA’s benefits. And, the Court concluded, the benefits of the ANCSA are considered “special programs and services provided by the United States to Indians because of their status as Indians.” Reconciling these conclusions, under the plain language of the ISDA definition, the Court determined that ANCs are “Indian tribes” for purposes of the CARES Act. Furthermore, the Court interpreted the phrase “recognized governing body” in the CARES Act not to serve as a form of eligibility criteria, but rather to identify the entity that will receive CARES Act funds.

The Supreme Court’s decision is intended to be narrow in application. Indeed, the majority opinion specifically explains that the decision “does not open the door to other Indian groups that have not been federally recognized becoming Indian tribes under ISDA.” Nor is the opinion intended to make ANCs “Indian tribes” for purposes of other statutes that may utilize different qualifying definitions. Nevertheless, the decision will have a critical and potentially lasting impact on both federally recognized Indian tribes and ANCs. The CARES Act funds in dispute, approximately $500 million in total, very likely would have been distributed among federally recognized Indian tribes had the Supreme Court ruled differently. Now, with the Court’s decision, ANCs will gain access to those relief funds for their own use.

If you have questions regarding the Supreme Court’s decision, please contact Matthew E. Feinberg, the author of this blog and Chair of PilieroMazza’s Litigation & Dispute Resolution Group, or a member of the Firm’s Native American Law & Tribal Advocacy Group.

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