Memorandum of Disapproval for the Indian Preference Act of 1990

I am withholding my approval of S. 321, the "Indian Preference Act of 1990." S. 321 would establish, among other things, a program to provide preferences to qualifying Indian enterprises in the award of Federal grants or contracts using funds appropriated for the benefit of Indians. The bill would impose new, expensive, and often duplicative program responsibilities on the Secretary of the Interior that would be difficult to implement. It would also likely result in Federal agencies assuming new, unfunded liabilities related to Indian preference enterprises.

My Administration strongly supports the goals of S. 321 and is committed to helping alleviate the widespread unemployment and underemployment on Indian reservations. Moreover, the Administration supports efforts to prevent companies from misusing Federal Indian preference programs. Accordingly, amendments are needed to the "Buy Indian Act" to increase Indian economic self-sufficiency and employment opportunities and to prevent utilization of preference provisions by non-qualifying companies. However, S. 321 is seriously flawed and would create more problems than it would solve.

I am withholding my approval of S. 321 to allow further review of the issues in the 102nd Congress. Many of the issues raised by S. 321 are complex and deserve a full airing in both Houses of Congress. The House passed S. 321 in the final days of the 101st Congress without sufficient consideration of these complex issues.

In the interim, I am directing the Secretary of the Interior to take the necessary steps to address the contracting problems identified in the November 1989 report of the Special Committee on Investigations of the Senate Select Committee on Indian Affairs.

In particular, I am directing the Secretary to issue guidelines that set forth specific procedures to govern Bureau of Indian Affairs field contracting officers in conducting pre-award reviews of grants and contracts. I am also directing the Secretary to develop and submit proposed regulations to implement the "Buy Indian Act" for Executive review within 90 days.

George Bush

The White House,

November 16, 1990.