25 CFR § 1000.2145 - What standard applies to a Tribe's/Consortium's management of funds awarded under a funding agreement?

---
identifier: "/us/cfr/t25/s1000.2145"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "25 CFR § 1000.2145 - What standard applies to a Tribe's/Consortium's management of funds awarded under a funding agreement?"
title_number: 25
title_name: "Indians"
section_number: "1000.2145"
section_name: "What standard applies to a Tribe's/Consortium's management of funds awarded under a funding agreement?"
chapter_name: "OFFICE OF THE ASSISTANT SECRETARY, INDIAN AFFAIRS, DEPARTMENT OF THE INTERIOR"
part_number: "1000"
part_name: "ANNUAL FUNDING AGREEMENTS UNDER THE TRIBAL SELF-GOVERNMENT ACT AMENDMENTS TO THE INDIAN SELF-DETERMINATION AND EDUCATION ACT"
positive_law: false
currency: "2026-03-24"
last_updated: "2026-03-24"
format_version: "1.1.0"
generator: "[email protected]"
authority: "25 U.S.C. 5373"
regulatory_source: "89 FR 100245, Dec. 11, 2024, unless otherwise noted."
cfr_part: "1000"
---


# 1000.2145 What standard applies to a Tribe's/Consortium's management of funds awarded under a funding agreement?

Funds awarded a Tribe/Consortium under a funding agreement, including advance payments, shall be managed by the Tribe/Consortium using the prudent investment standard, provided that the Secretary shall not be liable for any investment losses of funds managed by the Tribe/Consortium that are not otherwise guaranteed or insured by the Federal Government. The prudent investment standard requires the exercise of reasonable care, skill, and caution, and is to be applied to investments not in isolation but in the context of the investment portfolio and as part of an overall investment strategy, which should incorporate risk and return objectives reasonably suitable to the Tribe/Consortium. In making and implementing investment decisions, the Tribe/Consortium has a duty to diversify the investment, unless, under the circumstances, it is prudent not to do so. In addition, the Tribe/Consortium must:

(a) Conform to fundamental fiduciary duties of loyalty and impartiality;

(b) Act with prudence in deciding whether and how to delegate authority and in the selection and supervision of agents; and

(c) Incur only costs that are reasonable in amount and appropriate to the investment responsibilities of the Tribe/Consortium.