Prairie County, Montana v. United States

United States Court of Appeals
for the Federal Circuit
______________________

PRAIRIE COUNTY, MONTANA,
GREENLEE COUNTY, ARIZONA,
Plaintiffs-Appellants

v.

UNITED STATES,
Defendant-Appellee
______________________

2014-5060
______________________

Appeal from the United States Court of Federal
Claims in No. 1:12-cv-00645-MMS, Judge Margaret M.
Sweeney.
______________________

Decided: April 6, 2015
______________________

ALAN IRVING SALTMAN, Smith, Currie & Hancock LLP,
Washington, DC, argued for plaintiffs-appellants. Also
represented by EVANGELIN LEE NICHOLS; CHARLES W.
SURASKY, Atlanta, GA.

SHARON ANN SNYDER, Commercial Litigation Branch,
Civil Division, United States Department of Justice,
Washington, DC, argued for defendant-appellee. Also
represented by STUART F. DELERY, ROBERT E. KIRSCHMAN,
JR., BRYANT G. SNEE, SCOTT MACGRIFF.
______________________
2 PRAIRIE COUNTY, MONTANA v. US

Before LOURIE, O’MALLEY, and REYNA, Circuit Judges.
LOURIE, Circuit Judge.
Prairie County, Montana, and Greenlee County, Ari-
zona (collectively, the “Plaintiffs”) appeal from the deci-
sion of the United States Court of Federal Claims (the
“Claims Court”) dismissing their claim against the United
States (the “government”) seeking additional payments
under the Payment in Lieu of Taxes Act (“PILT”), 31
U.S.C. §§ 6901–6907 (2006), for fiscal years 2006 and
2007. See Prairie Cnty. v. United States, 113 Fed. Cl. 194
(2013). Because we conclude, as we did in Greenlee Coun-
ty v. United States, 487 F.3d 871 (Fed. Cir. 2007), reh’g &
reh’g en banc denied, No. 06-5053 (Fed. Cir. Aug. 23,
2007), cert. denied, 552 U.S. 1142 (2008), that the appli-
cable version of 31 U.S.C. § 6906 limits the government’s
liability under PILT to the amount appropriated by
Congress, we affirm.
BACKGROUND
I
In 1976, Congress enacted PILT to “compensate[ ] lo-
cal governments for the loss of tax revenues resulting
from the tax-immune status of federal lands located in
their jurisdictions, and for the cost of providing services
related to these lands.” Lawrence Cnty. v. Lead-
Deadwood Sch. Dist. No. 40-1, 469 U.S. 256, 258 (1985).
PILT directs the Department of the Interior (“Interior”) to
“make a payment for each fiscal year to each unit of
general local government in which entitlement land is
located.” 31 U.S.C. § 6902(a)(1). It also provides that the
“local government may use the payment for any govern-
mental purpose.” Id.
PILT provides two alternative formulas for calculat-
ing the amount of payment with respect to each eligible
local government based on the size of entitlement land
PRAIRIE COUNTY, MONTANA v. US 3

within the jurisdiction of the local government, the popu-
lation within that jurisdiction, and any funds that the
local government received during the prior fiscal year
from certain federal revenue-sharing programs. Id.
§ 6903. Section 6903(b)(1) provides that “[a] payment
under section 6902 of this title is equal to the greater of”
the two amounts derived from the alternative formulas.
The applicable version of § 6906 (2006) further provides
that “[n]ecessary amounts may be appropriated to the
Secretary of the Interior to carry out this chapter.
Amounts are available only as provided in appropriation
laws.” The principal question in this appeal is whether
the government’s liability under PILT is limited by the
amount appropriated by Congress for fiscal years 2006
and 2007.
II
In a prior suit, Greenlee County unsuccessfully sought
full payments according to PILT statutory formulas. For
fiscal years 1998 through 2004, Congress did not appro-
priate sufficient funds to provide for full payments to all
eligible local governments according to PILT formulas.
Interior followed the relevant regulation1 and proportion-
ally reduced PILT payments to each local government.
Greenlee County thus received PILT payments for each of
those fiscal years, but did not receive the full amount
according to the statutory formulas.
In 2004, Greenlee County sued the United States in
the Claims Court seeking to recover the difference be-
tween the amounts calculated based on PILT statutory

1 43 C.F.R. § 44.51(b) (2006) provides that “[i]f
Congress appropriates insufficient monies to provide full
payment to each local government during any fiscal year,
the Department will reduce proportionally all payments
in that fiscal year.”
4 PRAIRIE COUNTY, MONTANA v. US

formulas and the amounts it actually received for fiscal
years 1998 through 2004. The Claims Court, however,
concluded that under § 6906 the government’s obligation
was “expressly conditioned on the availability of appro-
priations,” Greenlee Cnty. v. United States, 68 Fed. Cl.
482, 486 (2005), and thus dismissed Greenlee County’s
suit “for failure to state a claim,” id. at 483.
On appeal, we affirmed the Claims Court. Greenlee
Cnty., 487 F.3d at 873. We concluded that “the language
of § 6906 limits the government’s liability under PILT to
the amount appropriated by Congress.” Id. at 878.
Greenlee County recognized that, under the then-existing
case law, the language of “subject to the availability of
appropriations” in other statutes, such as the Indian Self-
Determination and Education Assistance Act (“ISDA”),
was generally interpreted as restricting the government’s
liability to the amount appropriated by Congress. Id.
Greenlee County nevertheless sought to distinguish the
“subject to the availability of appropriations” language
from the language of § 6906. Id. We rejected that argu-
ment and found “little functional difference between
saying that amounts are ‘subject to the availability of
appropriations’ and saying that amounts are ‘available
only as provided in appropriations laws’” for limiting the
government’s liability. Id. Additionally, we reasoned that
“[t]he conclusion that PILT limits the government’s
liability to the amount appropriated is particularly ap-
propriate because PILT, like the statute in Star-Glo,
involves a benefits program not a contract, and ‘there is
greater room’ in benefits programs to find the govern-
ment’s liability limited to the amount appropriated.” Id.
at 879 (citing Star-Glo Assocs., LP v. United States, 414
F.3d 1349, 1355 (Fed. Cir. 2005)).
Greenlee County filed a petition for writ of certiorari
in the Supreme Court, which the Court denied. Greenlee
Cnty. v. United States, 552 U.S. 1142 (2008).
PRAIRIE COUNTY, MONTANA v. US 5

III
For fiscal years 2006 and 2007, Congress again did
not appropriate sufficient funds to provide for full pay-
ments according to PILT formulas. In 2012, the Plaintiffs
sued the United States in the Claims Court, seeking to
recover the difference between the amounts calculated
based on PILT formulas and the PILT payments that they
actually received for those two fiscal years. Prairie Cnty.,
113 Fed. Cl. at 198. The Plaintiffs asserted that the
Supreme Court’s decision in Salazar v. Ramah Navajo
Chapter, 132 S. Ct. 2181 (2012), changed the law such
that our decision in Greenlee County is no longer control-
ling. In Ramah, the Court held that the government is
obligated to pay the full amount of contract support costs
under ISDA contracts, when the amount appropriated by
Congress is sufficient to pay the costs of any individual
contracting tribe, but insufficient to pay the total costs of
all contracting tribes. 132 S. Ct. at 2186.
The government moved to dismiss for failure to state
a claim, and the Claims Court granted the motion. The
court concluded that Greenlee County remains controlling
precedent because Ramah involves government contracts
and the PILT program does not. Prairie Cnty., 113 Fed.
Cl. at 200. The court noted that the Supreme Court in
Ramah emphasized that its decision was based on
longstanding principles of government contract law,
whereas we have stated in Greenlee County that PILT
involves a benefits program, not a contract. Id. at 201.
The court also found that the Plaintiffs failed to allege
any implied-in-fact contract with the United States in
their complaint. Id. at 202. Moreover, the court held that
Greenlee County was collaterally estopped from relitigat-
ing the same issue. Id. at 203.
The Claims Court denied the Plaintiffs’ motion for re-
consideration and dismissed their suit. The Plaintiffs
6 PRAIRIE COUNTY, MONTANA v. US

appealed to this court. We have jurisdiction under 28
U.S.C. § 1295(a)(3).
DISCUSSION
We review the Claims Court’s grant of a motion to
dismiss for failure to state a claim de novo. Indian Har-
bor Ins. Co. v. United States, 704 F.3d 949, 954 (Fed. Cir.
2013). “A complaint must be dismissed under Rule
12(b)(6) when the facts asserted do not give rise to a legal
remedy.” Id. Issues of statutory interpretation are also
reviewed de novo. Qantas Airways Ltd. v. United States,
62 F.3d 385, 387 (Fed. Cir. 1995).
The Plaintiffs argue that the Supreme Court held in
Ramah and Cherokee Nation of Oklahoma v. Leavitt, 543
U.S. 631 (2005), that when multiple obligations are to be
paid out of a single lump sum appropriation, the statutory
language of “subject to the availability of appropriations”
does not limit the government’s total liability to the
amount appropriated by Congress. The Plaintiffs assert
that this court in Greenlee County misinterpreted similar
language in § 6906 as limiting the government’s liability.
According to the Plaintiffs, the government is obligated to
pay them the full amounts according to PILT formulas
upon Congress’s appropriation of funds that are sufficient
to cover their individual amount, even if insufficient to
pay all eligible local governments according to the formu-
las. The Plaintiffs also argue that PILT is not a benefits
program and, regardless, that there is no basis to treat
contractual obligations and statutory benefits differently.
Additionally, the Plaintiffs contend that Greenlee County
is not collaterally estopped from bringing this suit be-
cause Ramah changed the applicable law.
The government responds that Ramah does not
change the precedential value of Greenlee County, which
controls in this case because the same statutory language
of § 6906 that applied in Greenlee County also applies
here. The government emphasizes that Ramah addresses
PRAIRIE COUNTY, MONTANA v. US 7

issues of government contract law in the context of ISDA
and does not apply in this case because the government
does not owe any contractual obligation to the Plaintiffs.
The government maintains that PILT payments are
subsidies made at the discretion of Congress and that, as
we have decided in Greenlee County, § 6906 limits the
government’s liability. Moreover, the government re-
sponds that Greenlee County is collaterally estopped from
relitigating the same issue because Ramah has not
changed the law with respect to PILT payments.
We agree with the Claims Court and the government
that the Supreme Court’s decision in Ramah, decided
after Greenlee County, does not compel a different inter-
pretation of PILT. And we conclude, as we did in Greenlee
County, that the plain language of the applicable version
of § 6906 limits the government’s liability under PILT to
the amount appropriated by Congress.
In Greenlee County, we considered prior cases that
addressed the issue whether the government’s liability is
limited by Congressional appropriations in the context of
statutes other than PILT. 487 F.3d at 877–80 (citing
Cherokee Nation, 543 U.S. 631 (ISDA); United States v.
Langston, 118 U.S. 389 (1886) (a statute that provides for
a specific amount of salary to the representative of the
United States in Haiti); Star-Glo, 414 F.3d 1349 (a statute
that provides for payments to citrus growers for trees
destroyed by a citrus disease); N.Y. Airways, Inc. v. Unit-
ed States, 369 F.2d 743 (Ct. Cl. 1966) (a statute that
provides for payments to carriers for transporting mail)).
We recognized that “‘[i]t has long been established that
the mere failure of Congress to appropriate funds, without
further words modifying or repealing, expressly or by
clear implication, the substantive law, does not in and of
itself defeat a Government obligation created by statute.’”
Greenlee Cnty., 487 F.3d at 877 (quoting N.Y. Airways,
369 F.2d at 748). We noted, however, that “in some
instances the statute creating the right to compensation .
8 PRAIRIE COUNTY, MONTANA v. US

. . may restrict the government’s liability . . . to the
amount appropriated by Congress.” Id. at 878. After
analyzing PILT, we concluded that it is so limited because
the plain language of § 6906 limits the government’s
liability to the amount appropriated by Congress. Id. at
878, 880. We reasoned that our conclusion is “particular-
ly appropriate” because PILT “involves a benefits program
not a contract, and there is greater room in benefits
programs to find the government’s liability limited to the
amount appropriated.” Id. at 879 (internal quotation
marks omitted).
Ramah involves ISDA, a different statute, and decides
whether the government’s obligation to pay contract
support costs under self-determination contracts is lim-
ited by the amount appropriated by Congress. Ramah,
132 S. Ct. at 2186. As the Supreme Court explained in
Ramah, ISDA “directs the Secretary of the Interior, ‘upon
the request of any Indian tribe . . . to enter into a self-
determination contract . . . to plan, conduct, and adminis-
ter’ health, education, economic, and social programs that
the Secretary otherwise would have administered.” Id.
(citing 25 U.S.C. § 450f(a)(1)). The statute requires the
government “to contract to pay the ‘full amount’ of ‘con-
tract support costs.’” Id. (citing § 450j-1(a)(2), (g)). More-
over, “Congress included a model contract in ISDA and
directed that each tribal self-determination contract ‘shall
. . . contain, or incorporate [it] by reference.’” Id. at 2187
(quoting § 450l).
ISDA also provides that, “‘[n]otwithstanding any oth-
er provision in [ISDA], the provision of funds under
[ISDA] is subject to the availability of appropriations.’”
Id. at 2186–87 (quoting § 450j-1(b)). The model contract
specifies that, “‘[s]ubject to the availability of appropria-
tions, the Secretary shall make available to the Contrac-
tor the total amount specified in the annual funding
agreement’ between the Secretary and the tribe,” which
includes contract support costs. Id. at 2187 (quoting
PRAIRIE COUNTY, MONTANA v. US 9

§ 450l(c)). For each fiscal year at issue in Ramah, Con-
gress appropriated a total amount “for the operation of
Indian programs,” of which “not to exceed [a particular
amount]” was allocated for paying contract support costs.
Id. (quoting Department of the Interior and Related
Agencies Appropriations Act, 2000, 113 Stat. 1501A-148).
The appropriated amounts, however, were insufficient to
pay the aggregate contract support costs of all tribal
contractors, and the government paid the tribes’ contract
support costs on a uniform, pro rata basis. Id.
The Court held that, notwithstanding the “subject to
the availability of appropriations” language in both ISDA
and the self-determination contracts incorporating the
model contract, the tribes could recover the full amount of
contract support costs because “the Government cannot
back out of its contractual promise to pay each Tribe’s full
contract support costs.” Ramah, 132 S. Ct. at 2191. In
reaching that conclusion, the Court relied on “well-
established principles of Government contracting law,” id.
at 2189 (citing Ferris v. United States, 27 Ct. Cl. 542, 546
(1892)), as well as its earlier decision in Cherokee Nation,
in which the Court “stressed that the Government’s
obligation to pay contract support costs should be treated
as an ordinary contract promise, noting that ISDA uses
the word ‘contract’ 426 times to describe the nature of the
Government’s promise,” id. at 2188 (internal quotation
marks omitted). The Court explained that its ruling
“safeguards . . . the expectations of Government contrac-
tors,” id. at 2189, and “furthers the Government’s own
long-run interest as a reliable contracting partner in the
myriad workaday transaction of its agencies,” id. at 2190
(internal quotation marks omitted).
Here in this case, as we have stated in Greenlee Coun-
ty, PILT does not involve a contract. It is different from
Ramah and Cherokee Nation, as not all grants of benefits
are contracts. And the Plaintiffs do not appeal from the
Claims Court’s determination that they failed to allege
10 PRAIRIE COUNTY, MONTANA v. US

any implied-in-fact contract. PILT provides payments to
eligible local governments to compensate them “for the
loss of tax revenues resulting from the tax-immune status
of federal lands located in their jurisdictions, and for the
cost of providing services related to these lands.” Law-
rence Cnty., 469 U.S. at 258. Congress does not require
the local governments to provide particular services in
return for receiving PILT payments. The statute provides
that a “local government may use the payment for any
governmental purpose.” 31 U.S.C. § 6902(a)(1) (emphasis
added); see also Lawrence Cnty., 469 U.S. at 269 (“[T]he
counties should not be denied the discretion to spend
§ 6902 funds for any governmental purpose, including
expenditures that are linked to federal lands within their
borders.” (emphases added)). Accordingly, this case does
not involve the same question as that addressed by the
Supreme Court in Ramah and Cherokee Nation.
Absent a contractual obligation, the question here is
whether the statute reflects congressional intent to limit
the government’s liability for PILT payments, or whether
PILT imposes a statutory obligation to pay the full
amounts according to the statutory formulas regardless of
appropriations by Congress. As we have concluded in
Greenlee County, the plain language of § 6906 indicates
that Congress intended to limit the government’s obliga-
tion to the amount appropriated. The applicable version
of § 6906 provides that “[n]ecessary amounts may be
appropriated to the Secretary of the Interior to carry out
this chapter. Amounts are available only as provided in
appropriation laws.” 31 U.S.C. § 6906 (2006) (emphasis
added). The inclusion of the word “only” limits the avail-
ability of PILT payments to appropriations.
Moreover, the original version of what became § 6906
reads as follows: “There are authorized to be appropriated
for carrying out the provisions of this chapter such sums
as may be necessary: Provided, That, notwithstanding
any other provision of this chapter no funds may be made
PRAIRIE COUNTY, MONTANA v. US 11

available except to the extent provided in advance in
appropriation Acts.” 31 U.S.C. § 1607 (1976) (second
emphasis added); see also Pub. L. No. 94-565, § 7, 90 Stat.
2662, 2665–66 (1976). The language of the original ver-
sion clearly authorizes payments to local governments
only to the extent appropriated by Congress. See, e.g.,
Hughes Aircraft Co. v. Jacobson, 525 U.S. 432, 438 (1999)
(“As in any case of statutory construction, our analysis
begins with the language of the statute. And where the
statutory language provides a clear answer, it ends there
as well.” (citations omitted) (internal quotation marks
omitted)). In 1982, Congress recodified Title 31 of the
United States Code, including PILT, and altered the
language of § 6906 to the version that we apply in this
case. See 31 U.S.C. § 6906 (1982); Pub. L. No. 97-258, § 1,
96 Stat. 877, 1035 (1982). However, Congress explained
that it did not intend to change the meaning of the provi-
sion: “Sections 1–3 of this Act restate, without substantive
change, laws enacted before April 16, 1982, that were
replaced by those sections. Those sections may not be
construed as making a substantive change in the laws
replaced.” Pub. L. No. 97-258, § 4(a), 96 Stat. at 1067
(1982).
We also note that if Congress had intended to obligate
the government to make full PILT payments, it could
have used different statutory language. Indeed, Congress
amended § 6906 in 2008 to achieve a different result for
later years when it enacted the Emergency Economic
Stabilization Act, Pub. L. No. 110-343, Div. C, Title VI,
§ 601(c)(1), 122 Stat. 3765, 3911 (Oct. 3, 2008). Section
6906, as amended, provides that: “For each of fiscal years
2008 through 2012—(1) each county or other eligible unit
of local government shall be entitled to payment under
this chapter; and (2) sums shall be made available to the
Secretary of the Interior for obligation or expenditure in
12 PRAIRIE COUNTY, MONTANA v. US

accordance with this chapter.” 2 31 U.S.C. § 6906 (2008).
Notably, when amending § 6906, Congress chose not to
retroactively apply the amended provision to fiscal years
2006 and 2007, the fiscal years at issue in this appeal. 3
We have considered the Plaintiffs’ remaining argu-
ments but find them unpersuasive. Accordingly, we
conclude that the applicable version of § 6906 limits the
government’s liability under PILT to the amount appro-
priated by Congress. The Claims Court thus correctly
held that, on undisputed facts, the Plaintiffs may not
recover the difference between the amounts calculated
based on PILT formulas and the PILT payments that they
actually received for fiscal years 2006 and 2007. In light
of our resolution of this appeal on statutory grounds, we
need not address the collateral estoppel ground of the
Claims Court’s decision.
CONCLUSION
For the foregoing reasons, we conclude that the appli-
cable version of § 6906 limits the government’s liability
under PILT to the amount appropriated by Congress for
fiscal years 2006 and 2007. Because the Claims Court
correctly dismissed the Plaintiffs’ suit for failure to state a
claim, we affirm its decision.
AFFIRMED

2 Congress subsequently extended the effective
time period from fiscal year 2012 to 2013, Pub. L. No. 112-
141, Div. F, Title I, § 100111, 126 Stat. 405, 906 (2012),
and then from fiscal year 2013 to 2014, Pub. L. No. 113-
79, Title XII, § 12312, 128 Stat. 649, 992 (2014).
3 Because the newer version of § 6906 does not ap-
ply to this case, we need not decide here whether the
amendment would entitle all eligible local governments to
receive full PILT payments according to the statutory
formulas.