By Andrew Westney

Law360 (July 10, 2020, 6:52 PM EDT) -- A bipartisan pair of U.S. House of Representatives members are floating a bill to push back the deadline for tribes to spend $8 billion in COVID-19 relief funds from Dec. 30 to the end of 2022, saying the federal government's delays in disbursing the money have contributed to a time crunch on tribes.

Rep. Tom O'Halleran, D-Ariz., and Rep. Paul Cook, R-Calif., introduced H.R. 7557 on Thursday, which would extend the window for tribal governments to spend funding they have received under the coronavirus relief package, a $2 trillion law that included an $8 billion "tribal stabilization fund."

While the relief legislation set 30 days from its March 27 enactment as the deadline for the U.S. Department of the Treasury to distribute the funds, the initial $4.8 billion based on population data didn't start going out to tribes until May 5, amid lawsuits from federally recognized tribes challenging the delay and the inclusion of Alaska Native corporations in the Treasury's allocation plan.

"Bureaucratic red tape and lack of critical attention to the matter at federal agencies forced sovereign tribal nations across Arizona's First Congressional District to wait over a month for the first tranche of CARES Act funding to arrive, and tribes still face significant hurdles to spending and distributing the funding they were promised," O'Halleran said in a statement on Thursday.

"We need to extend the deadline by which tribal governments must spend Coronavirus Relief Fund payments so that each nation has adequate time to debate and discuss within their governing bodies, just as we did, and allocate the monies they are owed to most effectively address this pandemic head-on," O'Halleran added.

Most of the remaining $3.2 billion funds, which were based on employment and expenditure data, didn't start going out until June.

However, the Treasury Department has held back a portion of the funds to send to Alaska Native corporations, which recently won a ruling from a D.C. federal court that they are entitled to a share in the money — a decision put on hold while the plaintiff tribes appeal to the D.C. Circuit.

But the delay in funding and uncertainty over what the Treasury Department may allow the funding to cover has complicated tribes' efforts to figure out how to spend the money.

"This legislation will provide a much-needed extension to Indian Country so that tribal governments can determine how to best use these vital resources to respond to the pandemic," Cook, the ranking member on the Indigenous Peoples of the United States subcommittee, said in Thursday's statement.

COVID-19 cases have spiked in recent weeks in Arizona, and the Navajo Nation, whose reservation straddles Arizona, Utah and New Mexico, has been hit particularly hard by the pandemic, with 382 deaths due to the disease as of Wednesday.

"We are working around the clock to expedite the use of the CARES Act funds to address immediate needs and for the long-term benefit of our Navajo people," Navajo Nation President Jonathan Nez said in the lawmakers' statement on Thursday. "Indian Country is devastated by COVID-19 and due to the long years of neglect of infrastructure it will take much longer to get to a level of providing sufficient care."

The Navajo Nation received some $600 million in the first round of funding, but government officials conceded soon after the receipt of the funds that deploying them ahead of the current deadline would be a challenge.

And the Navajo Nation Council and Nez have been at odds over how to spend the money, with the council saying in a July 5 statement that Nez had vetoed $73 million from the council's plan to spend some of the tribe's total of $714 million in federal COVID-19 funding under the coronavirus relief package.

Chairman Timothy L. Nuvangyaoma of the Hopi Tribe, whose reservation lies in northeastern Arizona surrounded by the Navajo reservation, said in the statement that it is "only fair that Indian Country should be allocated additional time," because states received the funding much earlier.

"The Coronavirus Relief Fund will allow my Tribe to finally address the water, health, and broadband infrastructure needs that have plagued us for years and that have only been magnified as we confront COVID-19," Nuvangyaoma said. "Congress should empower Indian Country with more time so that we are able to deploy these resources in a responsible manner to confront the many infrastructure challenges that we face and that have hindered our abilities to respond to the pandemic."

--Additional reporting by Emma Whitford. Editing by Nicole Bleier.

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