as a result, some programs are proposal is vital. many times when we have had to able to pay for more than priority or life or limb withstand across-the-board cuts, there are unintended consequences. referrals or services. while overall need is still significant, the funding if there is not a connection increases are making a between the decision and how it is going to be implemented on difference. we have made significant the ground within indian progress in improving quality of country, some of the impacts are and access to care with devastating. improvements in customer as soon as those recommendations service, our use of health are formulated in real time, information technology, the success of the special diabetes consultation, direct engagement program for indians, and the with tribal leadership, subject matter experts in health and the early accomplishments of the methamphetamine and suicide different areas would be necessary. prevention and our domestic violence prevention initiatives. in as to what criteria we would look at, it seems the we would look at various personnel. if their work involves the construction program has contributed to improving its processing and administrative functions that are time- partnership with tribes and helping us complete and sensitive, those are some things we have experienced in the past continue health facility construction projects. or personnel are cut but that when i was first appointed to be results in a six test month

delay in getting an appraisal. the director of the indian health service, i heard input it seems the criteria we would from tribes, patience, and our look get is the function that staff that we needed to change and improve the indian health service in many ways. those administrative functions although we have made and procedures, how they significant progress in addressing our priorities, much directly relate to our work remains to be done. the population we serve implementation. i commend the department for continues to grow and the challenges of providing health looking at streamlining in care in rural america are ever indian country. present. we have had to be very efficient our data continues to show the incredible need for services by and clean and our operations. the patients we serve and we continue to work hard to meet we should all be looking at how our mission with available precious dollars can be used to resources. the increases in ihs funding directly benefit indian people. >> thank-you. over the past few years have helped us make progress but we still have much more to do. >> each system within each tribe the 2013 president budget request for ihs will help us address these challenges and is unique. make progress on our agency priorities for targeted investments from access to care one of the most important things and quality of care and support i think we can do is instead of our oversight and accountability functions and talking first, i think listen

address tribal management support costs. the budget request is $4.42 first and then we can get to the point we need to be. billion, an increase of $160 streamlining is not simply million over 2012. cutting a percentage out of the budget and saying we fixed it. that includes funds to support activities identified by tribes we have to understand what the process is and understand what as budget priorities. the goal is. the budget requests include $34 we need to set priorities to make sure that the system is million to increase inflation working to its best interests on costs and $20 million for behalf of each tribe and program increases for the contract held service program. progress in the tribe. as a look at this entire process, it involves the parties -- health service program. that would expand the purchase of health care from private- and the tribes. to make sure that we listen sector providers outside the indian health system. an increase of $49 billion is first and not just dictate that this is how we will do things. included to staff and operate a newly constructed health i have never believed in across facilities including our joint the board cuts. venture's facilities constructed by tribes i do believe if you base your prettified million dollar increase is included for contract support costs which is a priority for tribes that have re-evaluation based on a need, assumed management of our health you can go places. care programs previously managed by the federal government. that is my recommendation as it a $1 million increase in direct relates to streamlining. operations will help the agency >> ? continue its reforms and provide

accountability and oversight in next question is to the entire panel again. key administrative areas. we also include $6 million for health information technology to support the mandatory icd 10 unless congress acts, the budget implementation and $1 million faces sequestration measures for electronic dental records which could mean across-the- board cuts in many indian programs. we have $81.5 million budget to programs. can you describe the impact this continue construction on two facilities in progress. could have on your members? it is an increase of $1.7 million which will help address routine maintenance and improvement knees. which on our ability to make president shark? progress in improving the indian >> the impact would be devastating. health process but there is much the funding for basic services more work to be done. we will continue to work in partnership with tried to make as with natural resources and these improvements and improve law enforcement are already in the quality of and access to care for the patients we served. desperate need. the president's budget request for some areas, this may seem to helps us make projects -- be a slender but for indian progress in helping and changing the indian health process. country, there is -- that is a thank you for the opportunity to potential-in an already open present. wound.

>> thank you very much. for your statement. i would strongly encourage this committee to seriously consider secretary echo hawk, the budget and overall financial fiscal strategy for indian country that includes those things outside of federal appropriations. contemplates savings and you i think there is anathema to do mentioned $19 million by the -- there is an affirmative streamlining operations across duty knowing those cuts are all components of the imminent and knowing those cuts organization. will go deep into its trust obligations to indian tribes. my questions to you are all there is a duty to look at aspects of the organization alternative sources of increasing revenue intertribal being considered for this reduction such as office budgets into our treasuries. there are many other creative closures, cuts to programs, ways, strategic ways, to garner reductions in force. precious dollars and resources how do you intend to consult outside of federal appropriations with the private with tribes during this process? sector with small business >> mr. chairman, the first point development. to answer the question, it would be devastating and that requires a positive duty to look at other

approaches to funding our most i would like to make as to do basic services. with consultation. >> i go back to my comments of course, the president of about the principle foundation united states gave us the directive across the federal government to improve how we that before you cut the consult with tribes. programs, understand the needs of the service are. this past december, the i don't believe and across the department of interior adopted board cuts and i don't believe its new consultation policy. that they are detrimental in all of the areas we can't do whether they are large or small services. consultation, perhaps there is no more important part than consulting on the budget. as this budget process rolls out, that is my recommendation. on a quarterly basis, we let's look at the knees of the people and native people's needs assembled tribal leaders from all regions of the country to are just as important as anybody make sure that they have input in this great united states. on how we are crafting the budget. i know we will fight for every dime that we can get. i have to say that their cutting funding for programs position has been very clear to us that they do not support any that are already underfunded is cuts in spending through not the right solution. we are also survivors. interior indian affairs.

nevertheless, there are very as we have gone through our helpful to us in identifying history with the taking of land what the priority areas are. one of the messages i have heard and not receiving our do share, very clearly in this we will survive. consultation policy over the last three years is that when we definitely need help with these services and programs, budgets are tight and we have to thank you. >> thank you. >> i agree it would be be fiscally responsible that tribal leaders say not to forget devastating to our tribe and to our region as a whole. the federal government has to take its turn, too. don't just turn to a tribal i agree that across-the-board programs and start shopping. cuts are not the way to go. chopping. historically, tribes have been we have proposed streamlining under unfunded since the which means we will look very beginning and also -- in the carefully at what we can do more efficiently to consolidate beginning, too, tribes were programs and do everything we can to tighten the federal government's belt. predominately self-sufficient we will not do that on our own. prior to everything that has been happening. our plan is to move forward in a similar to the the consultation process. way of life we are attempting to we're not talking about lift and to cut budgets

reorganization without the approval of the congress but we further, the treaties have been are talking about identifying around for a long time and the ways we can save dollars in the trust funds had been around a long time. it has never been fully met federal bureaucracy so that we can fund the priorities of tribes. financially. we will be out there consulting beginning in april and listening to what tribes have to say about and -- the areas where we can do that belt-tightening within the the services is what comes back bureau of indian affairs and to from the government. within the bureau of indian education and the office of the we are trying to run our own assistant secretary. tribal governments. we have our own services and thank you. >> thank you very much. provide the best weekend and if . you start cutting the dollars, it is good to hear that you it will take away from the people. it will be devastating for us to continue to cut over the years. will do it by consultation. thank you. >> i want to thank you very much in my rather brief experience for your patience here and i with this area, i find that thank you very much for your responses to the questions and somehow indian tribes that the testimony.

there don't get the full i want to again express my message for many other things. thanks to the witnesses at today's hearing. to hear you consulting directly the testimony we have heard is great to hear. today makes it evident that the dr. roubidoux, in your president's budget request testimony, you state that reflects a concerted effort to trouble consultation is fulfill the trust responsibility. fundamental to your budget formulation process, too. however, we have significant concerns about the potential please discuss how tribal impacts of streamlining, consultations led to trouble sequestration, and balancing priorities being reflected in fiscal responsibility with the the proposed budget. >> trouble consultation is trust responsibility. i look forward to continuing these conversations with the administration, tribal leaders fundamental. the only way we will improve the like you and tribal health of our communities is to organizations. work in partnership with them. we have a travel budget finally, i would like to once again express the importance of formulation process that starts first the local level and the

hearing from all interested area level so we have 12 areas stakeholders' on these matters. in the fall and they hold the hearing record will remain meetings with tribes. open for written testimony for they determine what the area two weeks from today. level budget priorities are for so, i want to thank you very tribes. then we have a national budget much and thank you for being consultation that occurs usually in january and february or representatives from all the here to help us work together ihs areas come together and fight among each other to try to with you to help indian country get their priorities into the list. there is so many priorities for and the indigenous people of our funding. it is a difficult conversation country. thank you very much. for tribes. i am very grateful that they do this hearing is adjourned. that important work. [captioning performed by national captioning institute] it results in a great set of [captions copyright national cable satellite corp. 2012] recommendations for us to use as we began our budget formulation process. each year, they present their budget priorities to me and that is the first step in developing our proposals for the indian health service budget. it is an annual process of >> coming up later today here on tomorrow, the tribes will

present their recommendations on the 2014 budget. c-span, the justice department i'm looking forward to hearing the results as well. >> thank you very much. on consumer protection, focusing on seniors. that is at 2:15 p.m. eastern. on c-span2, energy secretary on >> a want to talk about some the 2013 energy department specific things. budget request. we will be live at 9:00 a.m. eastern on c-span3 and the carnegie endowment for the president's budget request international peace hosts a $12 million for indian irrigation projects. prime minister. none of these is in the proposed area for the wind river irrigation project in wyoming. in about 45 minutes, after we look at the headlines today, we according to a 2006 gao report, focus on u.s. options in syria with former there was a total of $84 million in deferred maintenance for this project. at our wyoming field hearing last april, the department of interior testified that they would begin working on a long- term plan to repair the deferred maintenance on indian irrigation projects. what has the department done

since april to reduce the deferred maintenance in the wind river irrigation project? >> i am not prepared to address that today but i would be happy to look into that and work with my staff and get you an immediate answer to your question. >> thank you. let me move on to law enforcement. the high priority performance goal project -- a pilot project was implemented on the wind river reservation in wyoming to decrease violent crime rates. the goal is 5% over two years. after the two years, the violent crime rates has increased by 7%. i understand there was an overall downward trend so some success in the rates are the last two years on a national basis of happen but we saw an increase. what efforts will be made to work to decrease the crime rate on the wind river reservation? >> that is an excellent

question. i am happy to bring good news with me today. we achieved the overall 35% reduction across the four reservations. wind river was the largest reservation that we dealt with. it was the area where we had to bring in the most law enforcement officers. i want to just emphasize that this is not a surge. these officers that were funded will be there permanently. it is not something where refund it temporarily and ceo works and then back off. -- where we see how it works and then back up. by the end of the 24-month period, we had an increase in crime. because it was large and we had so many law enforcement officers come in there and what happens when you bring in that large

number of officers, you will generate more reports that come in and then eventually because people feel safer, they report and we start to see a downward trend. after the 24 months ended, given another three months, we actually decrease crime and wind river by 11%. we knew that was probably going to be the case but we're obviously moving in the right direction there. that is good news for the community better i look forward to additional reports. >> there is $54 million increase for contract helps services. you testified at our budget hearing last year that the federal trial work group was to review the funding formula for contract held services and make recommendations. i ask you lester whether the formula would include a consideration of mortality and morbidity rates.

can you tell me whether those rates are now factored into the formula and what decisions to have made? >> thank you for the question. contract health services is such an important budget priority. it is the top priority. tribal leaders have been helping us over the past two years to make recommendations on how to improve the way we do business and look at how we provide funding. that worker decided they needed to have another year to look -- the work group decided they needed to have another year to look at budget increases to see how the formula played out. we expect them to have their discussions about the formula and whether it needs to be changed in the next year. >> i appreciate your personal attention to that given your background. if you could involved in the fighting is, i would be grateful. -- in the findings, i would be grateful. public safety was mentioned and people needing a place to feel

safe in their homes or workplaces. i want to talk about public safety and health care. they go hand in hand. patients and employees need to feel safe in the workplace. especially a place where pharmaceutical drugs need to be secured. at the budget hearing in 20008, before you were responsible, dr. coburn ask your predecessor what the indian health service was doing to protect the patients and employees said it was a specific hospital he was familiar with, claremore. resolve someng to jurisdictional issues. it is four years later and was not something you were charged with. you have inherited this problem but there is in -- as not really been an adequate resolution to the problem.

can you help address what needs to be done to resolve this matter? >> yes, we are aware of the issue at claremore indian hospital and it is serious unease to be resolved as soon as possible. i recently was briefed by staff. it looks like we have been working closely with the department of justice and the bureau of indian affairs. they have outlined some administrative and possible legislative options. the next step would be to decide what our priorities are for the options and to consult with the tribes. some of those options to involved whether the tribes will be helping us with this problem. we would be happy to discuss the details of those options with you and work with you on this issue. now that i have seen we have made progress in identifying some specific options, i will do what i can to push for resolution. >> thank you very much. >> thank you very much, senator

barrasso. my question is for the panel. the budget control act requires an enforcement mechanism called - and i mention this in my opening remarks -- sequestrastion which is due to take affect in january of 2015. my question to the panel is -- what would be sequestration have on the department's budget and your ability to provide core services to tribes? >> we are very concerned budgety

is protected in that automatically decrease which would be less. it still would be 2%. 2% for our budget equates to around $88 million. that would have to be applied to both of our accounts and services and facilities. we already know that our system has had to absorb a lot of costs including high medical costs and inflation and so on. having another $88 million to try to absorb and our budget would be very painful. it would be very difficult for our health care facilities and would certainly impact services. we are following the progress of this in congress. i have been talking with tribes that if this occurs, what is your preference on where we

might absorb these costs. the tribes are very reluctant to have that conversation because they don't want this to happen. they told me this will have a very significant impact on the services in their communities. we're following this very closely and it will have a great impact even though indian health service gets treated better, it is still a significant impact. >> thank you. >> we realize that we're living in this era of constrained budgets. as we have consulted with tribes, we have received some targets by omb to craft a budget which helps us figure out what our true priorities are. we had to go through exercises where we looked at 10% reduction and then 7% reduction.

even at the level we are now in this proposal where it is 2/10 of 1% reduction it is very painful. we try to make the priority of the tribes. we are streamlining. we're going after management efficiencies. it is painful for the federal government. we have a trust responsibility to fulfil. we have some feeling about how painful it would be to have to undergo additional cuts in the budget. i am just open that things can be worked through the congress so the sequestration does not automatically trigger. we are down to trying to solve problems that are very significant in indian country with a constrained budget already. >> thank you very much.

i have further questions that i will submit for the record. are there any further questions? i want to thank you so much for this panel, for your responses. we want to do the best that we can. streamlining, of course, is a difficult process but it can certainly save and we are looking forward to the things working out. i asked about sequestration primarily because it is something we hope we can work out at that time. i would like to thank our first

panel very much for your patience for being here today and look forward to working with you. thank you. now i would like to invite the second panel to the witness table. [no audio] >> due to the delay of this hearing, i just want you all to know that secretary thomas is

unable to testify on behalf of the national congress of american indians. however, we will include his full written statement into the hearing record. serving on our second panel is the hon. president of the affiliated tribes of northwest indians, the hon. mitchell x, principal chief of the eastern band of cherokee indians on behalf of the united south and eastern tribes and the hon. robert shepherd, chairman of his tribe.

on behalf of the great plains tribal association. welcome to you and thank you again for your patience. will use -- will you please proceed with your testimony? >> thank you. on behalf of the affiliated tribes of the northwest indians, we are honored to be here and thank you for the opportunity. we believe this is another reflection of a new era of partnership with the united states. we have a relationship with the president but now with the legislature, the congress. we thank you for that opportunity. i would like to begin our remarks by speaking to natural resources issues. the northwest is rich with abundant wildlife, fish, hunting, gathering and we would like to speak to a couple of issues that relate to, first of all, the rights protection fund.

we appreciate the increase, the proposed increase, from $28 million to $32 million but we recognize when you look at the entire issue across the nation, we are falling incredibly short of the other appropriations to our sister organizations throughout the united states. the great lakes indian fish and wildlife commission is looking at an increase of 17% relative to our 5% for the northwest indian fish commission and the columbia river intertribal treaty commission. you look at chippewa-ottawa and that is a 67% increase. in the northwest, our two intertribal organizations are at a 5% level but these others are at a substantially higher level.

that is one issue we noticed in the appropriations. a treaty is a treaty regardless of the geographical scope and our needs and planning desperately need to have funding levels at a place where we can adequately protect our most precious resources. the second issue that relates to natural resources is the pacific coastal salmon recovery fund. at its height in 2002, our funding level was at $110 million. in 2011, it was $79 million and a further decrease in 2012 to $65 million and this proposal for next year is $50 million, a $15 million reduction. this fund is essential for us as we work to prepare and preserve and protect our watersheds.

and our most precious resources and those natural resources subject to endangered species act as well as protecting our most critical trust obligations not only for our generation but for future generations. those funding levels must be at a place where our trust interests are protected. the next issue we would like to speak to has to do with law enforcement and public safety. in the northwest, we have tribes that border international waters. we have tribes in montana, washington, that border canada and we have noticed in this budget there is a proposed reduction of $2.6 million in the special initiatives project. that is designed to contend with international drug trafficking and border security issues.

i can attest to the gravity will of law enforcement issues in indian country where we know that drug trafficking organizations have targeted our lands. the justice reports that have been released have noted that. we have 30 miles of international border with 2,000 miles of logging roads from the ocean to highway 101, we have 22 points of entry. we have invested our own dollars into a drug task force, $400,000 of our own appropriations this year which resulted in first quarter, 48 arrests with 100% conviction rate and we recovered cocaine, heroin, methamphetamines, prescription pills and most recently our drug task force impounded a vehicle that came off of our logging roads and had an explosive device underneath.

this last fall, a young mother with two children were hunting in an area next to our lake. they came across a dead body. she was surrounded by vehicles and or all four corners -- on all four corners. the bad guys that recognize that we are vulnerable and it is not a time to reduce that critical fund. on behalf of the affiliated tribes of the northwest indians, we fully support the proposal and a package for this opportunity. >> thank you very much. for your testimony. chief hicks, will you please proceed with your testimony? >> we appreciate the opportunity. it is good to be here today and

good to be back in d.c. we are here to testify on behalf of the south and eastern tribes. there are 26 member tribes within the organization. i have worked for many years on budget and finance issues. i was elected in 2003 of the principal chief of the eastern band and i served as budget director and also served in the capacity as an independent auditor for our drive for a number of years -- for our tribe for a number of years with a new york accounting firm. i held my certified public accountant license for 13 years. i understand how difficult the budgeting process is. the eastern band has adopted what we call a balanced budget act. this assures that the cost of

our government does not exceed available resources. i understand you have a similar structure we have done a nice job of identifying through a needs basis, our critical programs. we have priority for our government and remembering with the obligation is to the people of our tribe and the people our region. the 2013 budget should reflect a federal priority can trust obligations to people. we can say that we share concerns related to inflation especially medical inflation and declines in allocations or allotments to specific areas that affect many of the troubled programs. -- many of the tribal programs. any time inflation kicks in and you have a minimizing of

resources, purchasing power declines and it affects the services we can put on the ground to people in various areas. i have been fortunate to travel throughout the nation and visit with many of the tribes that i am testifying for today and there are a lot of needs in the country that are not done. there is a lot of need that we cannot leave it as it is. and number of priorities have to be addressed. we are all aware of the history of the cherokee people. it is no secret that travesties that have occurred and the history and treatment of all native people and tribes. we cannot forget these tragedies but as tribal leaders we have to remind yourself of your responsibilities to take care of a people. as you look at this land we are

blessed with, there is not 1 inch of this particular land in our great nation that lies without native people's blood that is in this soil. our identity and traditions are vibrant even though we are less than 1% of the population. we are still la strong people and we have needs that to be taken care of. you believe tribes should be held harmless in these times of difficult budget priorities. this impacts lives of our native people. we have received various grants and we have a couple of examples -- there has been some small increases but we have historically seen where surgeries have been postponed that or not life-threatening but were critical.

with my travels throughout the nation, there is a lot of need out there that has to be made. our hospital is currently funded at 60% of the current levels it should have. we are blessed by having the resources supplement to that. many tribes don't have that same opportunity today. as we go through this process, that is part of our evaluation as to how to deal with that. dealing with the bia, there are so many responsibilities that affect education and many other critical programs. there was a chart appeared earlier that is rather scary where the resources of bie are going. the responsibility continue to grow how do we promote economic

development? how do we put people in homes? there is concern across the board in these various areas. one of the other critical points that definitely applies to everyone, the eastern band has a disturbing health issue called diabetes. 25% of our current population have some form of the disease. it is critical. in 2011, the first lady, michelle obama, identified what we call cherokee choices as a model program for reducing childhood obesity. if you look in the budget this year, it is identified under the centers for disease control and prevention, these funds have been cut out.

we have served 6000 members of the last 12 years with these funds. many tribes are affected. think about the health care of our people. addressing health care is not what we have a disease. preventive maintenance, preventive care is how we address the issues not only today but more importantly in the future. in consideration of the budget this year, you guys should go back and look at this particular area. when need to educate our people and promote the preventive maintenance i think is so important and it is no different for indian people than any other members of the united states. again, please focus on this. in closing, i would like to say that the budget identifies certain things and i hope through this congress this can be addressed. i believe there is a severe injustice to our indian people.

the eastern band of cherokee is not affected but we stand beside our brothers, all 565 of them, to address this issue and give us the economic opportunities and give us the land base to continue to protect our sovereignty and give is that right. i appreciate my time today and it is good to be back in d.c. and may god bless you and the decisions of the committee and is great united states. thank you. >> thank you very much, chief, for your testimony. now chairman shepard, please proceed with your testimony. >> thank you. [speaking native american] i am honored to be here and represent thi testimony. on behalf of the great plains

tribes consisting of 16 sovereign nations. we have the largest geographical and base of any region in the united states with over 11 million acres. cartwright said a total population of over will -- our tribes have a total population of 160 million people. we're not adequately funded. no unit of government can or should ever be asked to operate essential services on competitive grounds. grants. these are short-term solutions to long term problems. this results in limited services. we call upon congress to maintain the budgets to the necessary funding levels. the only way to this -- achieve sustainable gains on our reservations is to direct a

federal agencies to streamline the programming to andean countries. -- two indian country. we like to see funding streams consolidated, reporting requirements simplified and streamlined. should begencies especial directed appropriately and start returning funding and decision making authority to the regional and reservation a level. i would like to remind you today that until the united states returns to its contractual for the obligations and provides non-competitive funding, improvements will continue to be limited and their problems will increase. tribal nations now with the problems are. we know what our needs are. we can solve these problems but it requires restoration of the base funding levels necessary to exercise self-determination. and restoration of local control.

and not top down. the written testimony describes the needs in areas of education, tribal party programs, housing, a trust and national resources and economic envelopment, welfare resources, justice services, law enforcement and transportation. i would like to again remind the committee that we know what our needs are and will continue to try to satisfy these needs with every resource available. without the necessary funding levels for governmental services, our needs will not be fully met. i thank you for your time and consideration of our needs and recommendations, thank you. >> thank you very much. for your testimony.

president sharp, you mentioned tribes are eligible -- are ineligible for programs that cost federal agencies and are disproportionately underfunded per acre. how can we bring parity to tribal natural resource funding? >> that is an excellent question. a couple of things come to mind. the first would be towed to the eligibility of tribes to participate in the many opportunities throughout the federal agencies. we estimate there are millions of dollars the tribes are not eligible to compete.

it tried to be included in many other opportunities it should not matter where geographically good public policy across the united states means. there are tet boast of the barriers. we have some of the most pristine areas in our tribal communities. relative to state and local governments, our funding is incredibly short of where they are at. that would be one recommendation. it seems that when you look at national budgets of tribal governments, the revenue stream that comes in from grants and the federal government is just one revenue stream. there are many others that congress were to look at increasing private sector development within our tribal communities, there are some initiatives but by increasing a private sector, that allows us to increase our tax base and

those dollars would go to meet things like natural resources, incentivizing private sector partnerships with communities if you look a low income housing tax credits, we can sell those allowing corporations to defer their tax liability for 10 years and we are able to build housing infrastructure. there is the indian employment tax credit but it is effective the not working because we don't have the infrastructure for businesses to locate and ticket package of those tax credits. it tribes were able to sell the tax credit for indian employment, we did the math and if we could sell those just for the employees and our business is not counting our government, it would increase our national budget by 25%. there is a lot of tax policy and economic policy that is separate and apart from the federal funding and appropriations that could increase our national

treasuries. it is based in sovereignty. it should insulated from state local taxes which is another drain on our economy. many dollars are taken. i live on the reservation in my house is on the reservation but twice a year, i write a tax check for the county. those are a few ideas of how we might be able to increase the parity for natural resources. thank you. >> thank you very much. chief hicks, in your testimony, you state that insufficient funding for contracts support costs requires tribes to divert millions of dollars from health care services to fixed administrative expenses.

please discuss the impact this has on member tribes. i am asking this because you 3 represent different parts of our country, the western and appliance and the south and eastern areas as well. >> yes, sir, within any organization, there are various costs. direct costs but the services on the ground. -- put the services on the ground. you also have to have the administrative staff to be able to support the it systems, human resources and the overall management of the operation. there has to be a balance. defining where the priorities are, they are both priorities.

in regards to the contract support costs, they are very important to the operation. we are a compact hospital. we took over our hospital a few years ago so we manage it ourselves. those support cost dollars are extremely important to us. the eastern band is required to supplement because we're only funded at 60% of what our operation needs to service the 15,000 eastern band members we have in the area. it is extremely important. i hope and a restoration of these funds -- that of any restoration of these funds can be defined in this budget process. >> thank you, principal chief. this next question is for the panel. one of the ways the department

of the interior anticipates achieving savings in the president's budget and has been discussed is by streamlining services, reviewing personnel and functions at the region and agency level based on the needs of the tribes. my question for the panel is how would you like to see the department involved tribes in that effort? what do you think the department should take into account during this review? let me start by asking chairman shephaerd to respond to that. >> thank you.

by streamlining the money, i think that would get more direct services. the money would be utilized for the services. when you have different tiers of the administrative offices, a lot of that money is not being used for the purposes intended. the services on the ground, all the money is tied up in administrative costs. getting theto leftovers. that is not enough. for any of our regions. due consultation is the way to do it and timing is important, having the conversation before they make their decision is where we should be having the conversation. we sometimes get involved and it is too late and we're not very

effective when we are to lights of timing is critical. >> president sharp? >> i would agree with my colleague that direct consultation of the tribe on any