Devolution: Another Reason Tribes and States Should Work Together

Jan 10, 2017

By MBPC Staff

The start of the 2017 Montana legislative session is a great time to talk about two major incentives for state and tribal governments to work together to address mutual concerns—devolution and overlapping areas of governmental responsibility.

The term “devolution” stems from the so-called New Federalism reforms of the 1990’s and refers to the practice of devolving federal resources and administrative responsibility of federal programs to tribes, states, and local governments.

The intent of these policies was partly to give local governments greater freedom in determining how best to meet the needs of their respective citizens. However, they also allowed for the diminishment of federal administrative and fiscal responsibility for those programs; or in other words, they were tied to decreases in federal aid. Because of this—and the fact that an array of state and tribal governmental activities, programs, and responsibilities overlap—there is a great incentive for tribes and states to work collaboratively to maximize the impact of their available resources.

For tribes, devolution was largely evidenced in the passage of the Tribal Self-Governance Act of 1996, giving tribes the ability to compact management of one or more federal programs serving their reservations and the freedom to redesign the programs and reallocate funds for these efforts.

For states, devolution was seen primarily in the area of welfare reform. In 1996, the Personal Responsibility and Work Opportunity Reconciliation Act transferred financial resources and authority for federal income assistance programs to states. This transfer generally took the form of federal block grants to states for providing public services.

Some of these funds are passed through to tribal and local governments, who are eligible to administer a small number of programs.

According to a 2015 Center for Budget and Policy Priorities analysis of the 13 major housing, health, and social services block grant programs, funding for all but one has shrunk in inflation-adjusted terms since their inception—and in some cases, dramatically. Since 2000, the combined funding for the 13 block grants fell by 27 percent, or $14 billion in 2015 dollars.

In addition, block grant funding often cannot adjust to changes in need. Programs like SNAP (formally food stamps) grow by need. In block grants, the funding levels are set, so if a recession occurs and more people need help, the program must make the tough choice between serving fewer people and reducing the services per person to serve more people.

For both tribes and states, funding shortfalls complicate the administrative freedom that results from devolution. These decreases in overall program aid have put pressure on both tribal and state governments to either find ways to supplement program budgets or cut services for those programs—or sometimes both.

Thus, tribes and states have a vested interest in collaborating to maximize their resources when working to achieving some very significant mutual goals, including addressing the basic needs of their shared citizens and strengthening their shared economies.