By Emma Whitford

Law360 (October 27, 2020, 6:03 PM EDT) -- The U.S. Department of the Treasury urged the D.C. Circuit to affirm a lower court's finding that the Shawnee Tribe of Oklahoma is not owed a larger share of federal virus relief funds, doubling down on its stance that agency funding allocations are not reviewable.

The tribe is claiming that Treasury Secretary Steven Mnuchin irrationally used Indian Housing Block Grant population data to allocate $8 billion to tribes under Title V of the Coronavirus Aid, Relief and Economic Security Act.

The data was "patently false," resulted in an undercount of the tribe and was selected arbitrarily in violation of the Administrative Procedure Act, the tribe has said.

But the Treasury Department countered Monday that there is no rationality threshold for reviewability of agency actions.

"The tribe provides no statutory basis for imputing a judicially enforceable 'rationality' limitation on the secretary's determination of how to allocate scarce funds to eligible entities," the agency wrote. "The CARES Act contains no such language; it requires only that the secretary determine his manner to be appropriate."

The tribe pointed in its Oct. 9 opening brief to a recent D.C. Circuit panel finding that Alaska Native corporations can't share in the tribal government funding under the law, saying it showed coronavirus relief bill distribution choices are reviewable.

But the Treasury Department countered that the Alaska Native funding case considered "whether certain entities were eligible to receive funds at all," not the agency's discretion in dispersing funds to eligible entities. 

The Shawnee Tribe originally brought its case on June 18, claiming the government disregarded population data it provided and instead opted for the Indian Housing Block Grant metric, under which the tribe has a population of "zero."

In reality, the Shawnee said, it has more than 3,000 tribal citizens and is owed at least $6 million, not the minimum $100,000 it received.

Tossing the case on Sept. 10, U.S. District Judge Mehta pointed to the text of Title V, which states that the amount of funding a tribe receives "shall be ... determined in such manner as the secretary determines appropriate."

The Treasury Department also pushed back Monday on the tribe's claims that the IHGB metric rendered it "effectively ... extinct."

If the agency really deemed the tribe "extinct" it would not have provided it with any funds at all, the Treasury Department countered.

The D.C. Circuit's decision on Alaska Native Corporations freed up $162 million for federally recognized tribes and should be used right away to make the Shawnee whole, according to the tribe.

But the agency wrote Monday that it "does not intend" to disperse any of those funds until the U.S. Supreme Court has acted on pending petitions to review that decision, downplaying the tribe's claim that the court must act quickly to ensure it gets more funding. 

The Miccosukee Tribe of Indians of Florida and Prairie Band Potawatomi Nation in Kansas have brought similar claims challenging the use of the IHGB metric. Both filed amicus briefs to the circuit supporting the Shawnee this month. 

Counsel for the parties did not immediately respond to requests for comment Tuesday.

The Shawnee Tribe is represented by Luke Cass, Scott McIntosh, Pilar Thomas and Nicole L. Simmons of Quarles & Brady LLP and Gregory J. Bigler.

The federal government is represented by Adam C. Jed, Michael S. Raab, Daniel Tenny and Thomas Pulham of the U.S. Department of Justice.

The case is Shawnee Tribe v. Mnuchin et al., case number 20-5286, in the U.S. Court of Appeals for the District of Columbia Circuit.

--Additional reporting by Andrew Westney. Editing by Jay Jackson Jr.

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