[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]
H.R. 795, THE ``CHIPPEWA CREE TRIBE OF THE ROCKY BOY'S RESERVATION
INDIAN RESERVED WATER RIGHTS SETTLEMENT ACT OF 1999''
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HEARING
before the
SUBCOMMITTEE ON WATER AND POWER
of the
COMMITTEE ON RESOURCES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTH CONGRESS
FIRST SESSION
__________
JULY 1, 1999, WASHINGTON, DC
__________
Serial No. 106-41
__________
Printed for the use of the Committee on Resources
Available via the World Wide Web: http://www.access.gpo.gov/congress/
house
or
Committee address: http://www.house.gov/resources
______
U.S. GOVERNMENT PRINTING OFFICE
59-457 WASHINGTON : 1999
COMMITTEE ON RESOURCES
DON YOUNG, Alaska, Chairman
W.J. (BILLY) TAUZIN, Louisiana GEORGE MILLER, California
JAMES V. HANSEN, Utah NICK J. RAHALL II, West Virginia
JIM SAXTON, New Jersey BRUCE F. VENTO, Minnesota
ELTON GALLEGLY, California DALE E. KILDEE, Michigan
JOHN J. DUNCAN, Jr., Tennessee PETER A. DeFAZIO, Oregon
JOEL HEFLEY, Colorado ENI F.H. FALEOMAVAEGA, American
JOHN T. DOOLITTLE, California Samoa
WAYNE T. GILCHREST, Maryland NEIL ABERCROMBIE, Hawaii
KEN CALVERT, California SOLOMON P. ORTIZ, Texas
RICHARD W. POMBO, California OWEN B. PICKETT, Virginia
BARBARA CUBIN, Wyoming FRANK PALLONE, Jr., New Jersey
HELEN CHENOWETH, Idaho CALVIN M. DOOLEY, California
GEORGE P. RADANOVICH, California CARLOS A. ROMERO-BARCELO, Puerto
WALTER B. JONES, Jr., North Rico
Carolina ROBERT A. UNDERWOOD, Guam
WILLIAM M. (MAC) THORNBERRY, Texas PATRICK J. KENNEDY, Rhode Island
CHRIS CANNON, Utah ADAM SMITH, Washington
KEVIN BRADY, Texas WILLIAM D. DELAHUNT, Massachusetts
JOHN PETERSON, Pennsylvania CHRIS JOHN, Louisiana
RICK HILL, Montana DONNA CHRISTIAN-CHRISTENSEN,
BOB SCHAFFER, Colorado Virgin Islands
JIM GIBBONS, Nevada RON KIND, Wisconsin
MARK E. SOUDER, Indiana JAY INSLEE, Washington
GREG WALDEN, Oregon GRACE F. NAPOLITANO, California
DON SHERWOOD, Pennsylvania TOM UDALL, New Mexico
ROBIN HAYES, North Carolina MARK UDALL, Colorado
MIKE SIMPSON, Idaho JOSEPH CROWLEY, New York
THOMAS G. TANCREDO, Colorado RUSH D. HUNT, New Jersey
Lloyd A. Jones, Chief of Staff
Elizabeth Megginson, Chief Counsel
Christine Kennedy, Chief Clerk/Administrator
John Lawrence, Democratic Staff Director
------
Subcommittee on Water and Power Resources
JOHN T. DOOLITTLE, California, Chairman
KEN CALVERT, California CALVIN M. DOOLEY, California
RICHARD W. POMBO, California GEORGE MILLER, California
HELEN CHENOWETH, Idaho PETER A. DeFAZIO, Oregon
GEORGE P. RADANOVICH, California OWEN B. PICKETT, Virginia
WILLIAM M. (MAC) THORNBERRY, Texas ADAM SMITH, Washington
GREG WALDEN, Oregon DONNA CHRISTIAN-CHRISTENSEN,
MIKE SIMPSOM, Idaho Virgin Islands
GRACE F. NAPOLITANO, California
Robert Faber, Staff Director/Counsel
Joshua Johnson, Professional Staff
Steve Lanich, Minority Staff
C O N T E N T S
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Page
Hearing held July 1, 1999........................................ 1
Statement of Members:
Hill, Hon. Rick, a Representative in Congress from the State
of Montana................................................. 14
Statement of Witnesses:
Fragua, Roger, Manager, American Indian Affairs, Enron
Corporation................................................ 36
Prepared statement of.................................... 39
Hayes, David J., Acting Deputy Secretary of Interior,
Department of the Interior................................. 3
Prepared statement of.................................... 3
Morsette, Jim, Director, Chippewa Cree Tribal Water Resources
Department, Chippewa Cree Tribe of the Rocky Boy's
Reservation................................................ 6
Prepared statement of.................................... 8
Tweeten, Chris, Chief Counsel to the Montana Attorney
General, Chairman, Montana Reserved Water Rights Compact
Commission................................................. 15
Prepared statement of.................................... 16
H.R. 795, THE ``CHIPPEWA CREE TRIBE OF THE ROCKY BOY'S RESERVATION
INDIAN RESERVED WATER RIGHTS SETTLEMENT ACT OF 1999''
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THURSDAY, JULY 1, 1999
U.S. House of Representatives,
Subcommittee on Water and Power,
Committee on Resources,
Washington, DC.
The Subcommittee met at 11:08 a.m., in Room 1334, Longworth
House Office Building; Honorable John Doolittle [chairman]
presiding.
Mr. Doolittle. The Subcommittee on Water and Power will
come to order. We are meeting today to hear testimony
concerning H.R. 795, the Chippewa Cree Tribe of the Rocky Boy's
Reservation Indian Reserved Water Rights Settlement Act of
1999.
I do want to remind everyone we have a new system in place
that places your comments worldwide on the Internet as they are
made. So you may wish to remember that as you are making
private comments to each other before the microphones.
Last year the Subcommittee held a legislative hearing on
the Chippewa Cree Tribe of the Rocky Boy's Reservation on this
precise subject, which is the first new Indian water rights
settlement to come before the Congress in many years. During
that hearing several significant policy issues critical to
water management in the western United States were presented.
These issues included:
(1) The statutory, regulatory and judicial history of
implied Federal reserve water rights.
(2) State jurisdiction in the appropriation and later
distribution of water.
(3) The appropriate funding mechanisms to resolve
these problems.
(4) The appropriate methods for determining liability
in Indian water rights settlements.
Since that hearing we have worked closely with the tribe,
the State of Montana, the departments of Justice and Interior
and the Senate to work through these issues. I believe that
everyone involved has a genuine desire to address the
fundamental need the Indian tribe has for adequate water
resources.
We now believe we are close to reaching that goal and
advancing the legislation. One of the most important
initiatives we have been pursuing with the tribe is the
opportunity to get the tribe valuable financial advice in
exercising their water rights once we approve the settlement.
It has come to our attention that the business community is
interested in working with tribes to provide comprehensive
water assessment, valuation and feasibility information at
private sector expense.
We have worked to bring the parties together and believe
this is the kind of sound advice that should be available to
tribes as they look for ways to perfect and use their water
rights. We encourage other tribes and private sector interests
to build on this approach.
We would further encourage the Administration to work
toward this type of practical approach that will allow tribes
at the end of day to make real use of their water rights to
meet economic development and water quality goals.
We want to express our appreciation to the tribe and to the
other interested parties in making progress on these issues.
Recently we have also been pursuing language with the
involved parties to create two titles in the legislation.
Section 8 of H.R. 795, the Tiber water allocation, would become
Title II, and sections 5 through 7 and 9 through 12 would then
become Title I. The remaining miscellaneous provisions would be
applicable to both titles. These changes will address water
issues concerning the use of non-appurtenant water sources for
the water rights settlement.
Title II, on the other hand, presents an opportunity
outside of a reserved water rights settlement for the tribe to
pursue use of unallocated Federal project water in Tiber
Reservoir to meet some of their additional water needs.
The Rocky Boy's settlement process has been important for a
number of reasons. The State of Montana and the tribe has spent
a good deal of time working through the issues in a
constructive fashion, taking steps to minimize the impact on
other affected water users. Furthermore, there has been minimal
emphasis on some of the outmoded bases for calculating these
claims.
We need to look to newer, more practical approaches that
find solutions which provide tribes with real opportunities
without making demands that may destroy the economic livelihood
of existing water users. Interior, the tribe and the state are
to be commended for their approach in this case and their
ongoing flexibility as we set the parameters for future Indian
water rights settlements.
I look forward to hearing from our witnesses today. With
that, let me ask our witnesses on the panel to rise and raise
their right hands.
[Witnesses sworn.]
Mr. Doolittle. Let the record reflect that each answers in
the affirmative. Please be seated. We appreciate your being
here.
We will begin with hearing testimony from our acting deputy
secretary of Interior, Mr. David Hayes, who has rearranged his
vacation plans or maybe curtailed his vacation plans to
actually be here today to testify. I can't help but observe
that Mr. Hayes has been, I feel, a very positive force in
helping us bring resolution to these matters. I appreciate your
being here, Mr. Hayes. You are now recognized for your
statement.
STATEMENT OF DAVID J. HAYES, ACTING DEPUTY SECRETARY OF
INTERIOR, DEPARTMENT OF THE INTERIOR
Mr. Hayes. Thank you, Mr. Chairman. I appreciate those
words. Let me say at the outset that I appreciate your
leadership on this issue, Mr. Chairman, and also that your
counsel Bob Faber has been an excellent individual to work with
on this as well as the rest of his staff. We think the dialogue
that we have had over the past several months has been
extremely productive in the best sense of the bipartisanship
that we are trying to bring to this issue. I wanted to state
that for the record.
Mr. Doolittle. Thank you.
Mr. Hayes. I will be brief, Mr. Chairman. I have a written
statement that I request be put in the record. I will only make
three brief points here this morning in supplement of my
written statement.
First, I would like to emphasize, as your opening statement
did, Mr. Chairman, that this western water settlement is a
product of a state and tribal-led negotiation process. This is
a grassroots led effort from the State of Montana, and that is
as it should be. We in the Federal Government very much want to
see western water settlements that are framed and negotiated by
the real parties and interests on the state level, in this case
the State of Montana and its citizens, including the Chippewa
Cree Tribe of the Rocky Boy's Reservation.
We believe it is important that the Administration and the
Congress respect and implement the accommodations reached by
the local, state, Federal, and tribal parties, and we are here
to offer our support for what they have done.
Second, the Administration believes that the Federal
financial contribution to this water settlement is appropriate
and is targeted to the specific needs and rights of the
Chippewa Cree Tribe. In particular, Federal funds will be used
to enhance on-reservation water supplies, thereby enabling the
tribe to stretch its meager water supplies, give it more
flexibility, and at the same time protect the interests of
downstream non-Indian water users.
Finally, I would like to say that as the trustee to the
tribe, the United States has a responsibility to help make the
settlement a reality, and we want to do whatever we can to that
end. As you well know, north central Montana is a water short
area. Farming and ranching are the key economic activities for
the tribe, and water is an essential ingredient for the tribe's
livelihood.
I will close by just saying that after many years of
efforts this legislation has emerged from the grassroots, from
the state and local interests, including the tribe, with the
help of the local, regional Federal team, and we are excited
and hopeful that it can become law with your help, Mr.
Chairman. Thank you.
[The prepared statement of Mr. Hayes follows:]
Statement of David J. Hayes, Acting Deputy Secretary of the Interior
Good morning Mr. Chairman and members of the Committee. I
am David J. Hayes, Acting Deputy Secretary of the Interior. It
is my pleasure to be here today to testify on behalf of the
Administration in support of H.R. 795. This bill represents the
successful culmination of over eight years of negotiation among
the United States, the State of Montana and the Chippewa Cree
Tribe of the Rocky Boy's Reservation over water rights disputes
being litigated in the case entitled, In the Matter of the
Adjudication of All Rights to the Use of Water, Both Surface
and Underground, within the State of Montana. It represents a
true partnership among Federal, State and Tribal interests.
Through a great deal of hard work, the parties have forged a
water rights settlement that satisfies Tribal rights and needs,
while also taking into account the rights and needs of non-
Indian neighbors, and enabling all affected Montanans to plan
for the future with confidence and certainty. As you know,
similar legislation to ratify this agreement was introduced in
both the Senate and the House last year. However, a packed
legislative calendar and a few eleventh-hour hurdles prevented
the legislation from moving. We have worked closely with the
State and the Tribe to address the questions that have come
from the Hill and, believing that the concerns voiced have been
satisfied, we are again here before this Committee seeking your
support for this important legislation.
The Rocky Boy's Reservation, located in North Central
Montana, consists of approximately 110,000 acres and includes
several tributaries of the Milk River. The average annual water
supply on the Reservation is limited by hydrological delivery
constraints and inadequate storage infrastructure. The Tribe
has over 3,500 enrolled members and a population growth rate
well above the typical rate for tribes of 3 percent. Tribal
unemployment averages around 60-70 percent in an economy based
primarily on agriculture, including raising livestock. Existing
Reservation water use includes irrigation, livestock
consumption, wildlife and recreational use, and municipal and
industrial uses. The Tribe's municipal water is derived from 12
community wells and approximately 240 individual wells. A
majority of the domestic wells suffer from low production due
to aquifer overdraft or improper siting. In addition,
groundwater contamination from hydrogen sulfide, iron and
manganese contributes to well casing corrosion and makes the
water very unpleasant to drink or use for other domestic needs.
Since the Tribal economy is heavily based on livestock and
hay is the principal crop grown using irrigation, the Tribe's
goal is to maintain, or perhaps slightly increase, the current
level of irrigated agriculture on the Reservation in order to
avoid having to purchase supplemental livestock forage on a
regular basis. Without enhanced on-Reservation storage and
other infrastructure improvements, experts calculate that,
within 20 to 40 years, the Tribe will be unable both to
maintain its modest agricultural base and meet the domestic
water needs of its rapidly growing population.
The United States, the State and the Tribe struggled for
many years to find an immediate solution to the problem of an
inadequate Reservation water supply. For a time, the Tribe
viewed the only solution to be the importation of water from
the Tiber Reservoir, a Bureau of Reclamation facility some 50
miles from the Reservation. In this context, the water would
have been delivered to the Tribe as part of a combined Indian/
Non-Indian system. This system would have been very expensive
and would have required an extensive Federal subsidy. Moreover,
this system would have cost the Federal Government far more
than it could reasonably be expected to pay to settle the
Tribe's water rights. Rather than pursue this expensive
regional water system, the parties decided to focus on
developing existing Reservation water supplies and setting
aside funds that will be available for use in a future plan to
supplement on-Reservation water supplies. This is the approach
that has been adopted in H.R. 795.
Under the terms of H.R. 795, Congress would approve, and
authorize participation in, a Water Rights Compact entered into
by the Tribe and the State. The Compact was enacted into
Montana law on April 14, 1997, and recognizes the Tribe's right
to approximately 10,000 acre-feet of water on the Reservation.
In order to enable the Tribe to exercise its on-Reservation
water right, the United States would contribute $24 million for
four specific on-Reservation water development projects and
additional funds of no more than $1 million to cover Bureau of
Reclamation (BOR) administrative costs associated with these
construction activities. First and foremost among the projects
is the repair and enlargement of Bonneau Reservoir, a facility
that has ranked in the top ten of the Department's ranking list
of most dangerous dams. Other projects include repair and
enlargement of several smaller on-Reservation irrigation and
recreational dams, including East Fork, Brown's and Towe's Pond
dams.
H.R. 795 also addresses the Tribe's future water needs by
providing the Tribe with the right to an additional 10,000 AF
of water stored in Tiber Reservoir. This allocation is only a
small percentage of the 967,319 acre feet of water stored in
Tiber Reservoir and will not impact on any other use of the
Reservoir. The Department has carefully considered the impact
of the allocation on the reserved water rights of other Indian
tribes and has concluded that such rights will not be
negatively affected.
It is important to note that by making the Tiber Reservoir
allocation, the United States is not undertaking any obligation
to deliver water to the Reservation. Section 8(d) of the bill
expressly provides that the United States shall have no
responsibility or obligation to deliver the Tiber allocation or
any other supplemental water to the Reservation.
Nonetheless, in order to assist the Tribe when the time
comes that it needs additional on-Reservation water supplies,
H.R. 795 provides that the United States will set aside $15
million in trust toward the planning, design, construction,
operation, maintenance and rehabilitation of a future
Reservation water supply system. In addition, the bill
authorizes BOR feasibility studies totaling $4 million to
explore alternative methods of augmenting the Rocky Boy's
Reservation water supply, as well as analyzing region-wide Milk
River water availability and enhancement opportunities. One
particular alternative that will be studied will be the
feasibility of releasing the Tribe's proposed Tiber Reservoir
allocation into the Missouri River for later diversion into a
treatment and delivery system for the Reservation. We are
hopeful that this alternative or others identified by the BOR
studies will prove to be more realistic and reasonable
solutions than an expensive rural water supply system centered
upon a pipeline from Tiber Reservoir. The BOR studies should
provide an in-depth understanding of the Milk River Basin water
supply, its potential and limitations, that will be of valuable
assistance to the United States, the State of Montana and
Montana Indian tribes in our efforts to address Indian water
rights disputes. The studies will address, as well, some of the
water supply problems facing many small North Central Montana
communities.
Other components of the Chippewa Cree settlement include a
$3 million Tribal Compact Administration fund to help defray
the Tribe's Compact participation costs and a modest $3 million
Tribal Economic Development fund to assist the Tribe in putting
its water to use.
The total Federal contribution to the settlement is $50
million. We believe that this expenditure is appropriate and
justified. The Tribe has presented the United States with a
legal analysis setting forth a substantial damages claim
against the United States. The Department of Justice and the
Department of the Interior have analyzed the claim and
concluded that settlement is appropriate. In addition to
releasing the United States from damage claims, the settlement
also will relieve the United States of the obligation to
litigate, at significant cost and over many years, the Tribe's
water rights. The certainty secured by the settlement is, in
fact, its central feature. By resolving the Tribe's water
rights, all of the citizens of this area of the State of
Montana will be able to plan and make investments for the
future with the assurance that they have secure and stable
water rights.
Like other Indian water rights settlements, the benefits to
accrue to the Tribe and other settlement parties will be
available only after a final water rights decree is issued by
the appropriate court. We expect that the process of entering
and gaining final approval of the decree will take
approximately eighteen months to two years. As motivation to
keep the court approval process moving, the settlement parties
have established a three year deadline for finalization of the
decree. The Department of the Interior is committed to
advancing the court process and other settlement implementation
tasks as expeditiously as possible in order to avoid having to
seek Congressional relief from the settlement deadline. The
Chippewa Cree Tribe has waited many years to see its water
rights become a reality and we do not want to see that wait
prolonged any more than is absolutely necessary.
As I mentioned at the beginning of my statement,
legislation to ratify this settlement was introduced last year,
but was not passed. As the State and the Tribe will testify,
this settlement is broadly supported within Montana,
particularly by Governor Racicot and the State Legislature, who
are on record as strongly supporting the settlement. Moreover,
appreciating the value and importance of such agreements, the
Western Governors Association passed a resolution (98-029, June
30, 1998) reiterating its support for negotiated settlements of
Indian land and water claims, lauding recent progress, adding
that ``the need to resolve these disputes and redress tribal
grievances [through settlements] is critical.''
H.R. 795 presents an opportunity for the United States to
ratify its first Western water settlement since the early
1990's and the Administration strongly supports this bill. I
hope that the members of this Committee also will support this
non-controversial settlement and that you will encourage swift
passage of the legislation before you.
I will be happy to answer any questions you may have.
David J. Hayes, Acting Deputy Secretary, Departmeent of the Interior
David J. Hayes is the Acting Deputy Secretary of the
Interior, He is serving as the Deputy Secretary in an Acting
capacity pending his confirmation by the United States Senate.
As the Acting Deputy Secretary, Mr. Hayes is the second in
command at Interior. He is responsible for assisting Secretary
Babbitt in supervising and administering the Department's
bureaus and offices, including the National Park Service, the
U.S. Fish & Wildlife Service, the Bureau of Reclamation, the
U.S. Geological Survey, the Bureau of Indian Affairs, the
Bureau of Land Management, and the Minerals Management Service.
The Department has a total of approximately 70,000 employees,
and an annual budget of approximately $8 billion dollars.
Mr. Hayes also has responsibility for addressing legal and
policy issues of special importance to the Department. By way
of example, Mr. Hayes led the Interior team that acquired the
Headwaters old-growth redwood forest in Northern California. He
also is leading Interior initiatives related to the Lower
Colorado River (including Southern California, Nevada and
Arizona water supply issues), salmon recovery, hydropower
regulation, Indian water rights matters and a number of eco-
system projects, including the Salton Sea (CA), Trinity River
(CA), Walker Lake (NV), and others.
Before entering the Administration in early 1997, Mr. Hayes
practiced law for nearly twenty years in the environmental and
natural resources field. Immediately prior to his Federal
service, he was a partner in the Washington, D.C. office of the
national law firm of Latham & Watkins where he chaired the
office's Environmental Department. Mr. Hayes is a former
Chairman of the Board of the Environmental Law Institute, a
non-profit research and publication center for environmental
law and management professionals.
Mr. Hayes received an A.B. from the University of Notre
Dame in 1975, summa cum laude, and a J.D. from Stanford Law
School in 1978. He clerked for Judge William Jones and Judge
Louis Oberdorfer on the United States District Court for the
District of Columbia, He lives in Arlington, Virginia with his
wife, Elizabeth, and their three children.
Mr. Doolittle. Thank you.
Our next witness is Mr. Jim Morsette, Director of the
Chippewa Cree Tribal Water Resources Department within the
Chippewa Cree Tribe of the Rocky Boy's Reservation. Mr.
Morsette.
STATEMENT OF JIM MORSETTE, DIRECTOR, CHIPPEWA CREE TRIBAL WATER
RESOURCES DEPARTMENT, CHIPPEWA CREE TRIBE OF THE ROCKY BOY'S
RESERVATION
Mr. Morsette. Good morning, Mr. Chairman. Mr. Chairman,
Representative Rick Hill, I bring you greetings from Rocky Boy,
Montana and invite you to come back to visit our reservation.
It's a unique reservation located in the Bear Paw Mountains. We
would appreciate it if you would come back and just see how the
Chippewa Cree live.
I would like to introduce our Tribal Chairman in the
audience, Mr. Bert Corcoran, and staff sitting behind me, Mr.
Dan Belcourt, our staff attorney, and our water attorney, Mrs.
Yvonne Knight, sitting directly behind me.
I have detailed written testimony from the tribe that I
would like to submit for the record.
I would like to start out by, first of all, thanking the
Creator, thanking our God for allowing me to be here and for
the many blessings that our Creator has given me in my personal
life and my family. I would like to offer some prayers to the
Chairman of the Committee, Mr. Hill, and the people you
represent, everyone sitting in this room. The prayers that we
need around the world today. I would like to say that our
belief in the Creator founded our reservation.
Our tribal people, the elders, have wandered around. We
were unable to accept some of the treaty conditions that were
laid out in the early 1800s, for whatever reasons. I'm not
really privy to that, but our people wandered for years trying
to find a homeland.
In 1916 Congress granted the Chippewa Cree Tribal Homeland.
That was all part of the Assiniboine military reservation. What
we wanted was a place to live, practice our way of life, and to
raise a family, and we wanted to be able to do that in a home
where we could say ``this is our land,'' and we wanted to be
able to provide for the economic future of our people and raise
them accordingly.
We found that in Rocky Boy's, but as time went on we became
more populous. It was never suitable for us to be sustainable.
We don't have enough water in that region, and by this
agreement that we worked out with our neighbors we satisfied
all our neighbors. We satisfied our neighbors and the tribe's
needs.
What we began as a pursuit years ago we are finally seeing
as a reality. Hopefully today we have come to realize that we
do have a homeland now for the Chippewa Cree Tribe that we can
call home and practice our culture and raise our children.
This has been a long struggle for us. We started this
process in 1989. Our Tribal Council appointed a water rights
negotiating committee, and we had a very sacred pipe ceremony
where we sat down in the floor of our chambers and said this is
a spiritual journey; what we are dealing with is the sacredness
of water, the essence of all life. Without water there is no
life. We came to understand that and we want to share what we
call a resource today not only with our neighbors and our own
tribal members, but with the animals we need for our
livelihood. For everything that it takes to live this water is
that life.
I might add that the chairman of our committee, my
immediate boss, is a sundance maker. As we speak, he is in
fasting right now. We have our annual sundance with a fast up
to four days without water, without food. So that is what he is
doing right now. It is to give reverence to this gift that we
have, this water, this life that we have that we are talking
about today.
So we don't take this lightly. This is a big journey that
we are on. This is probably the most important venture I've had
in my life that I have committed myself to, bringing water to
our Chippewa Cree people and the surrounding community so we
could live together and raise our families.
That is what we are here for today. All the technical
things that we have are written in our testimony. I would want
to share that with you and bring to the Committee about how we
feel and reverence that we have for this issue that we talked
about today.
In our settlement we have enough water. We have
approximately 20,000 acre-feet that comes off of Rocky Boy, and
we took 10,000 acre-feet of that to satisfy some of our storage
rights, storage facilities, so we could irrigate, so we could
have recreation, so we can have fisheries.
The other 10,000 acre-feet is from Tiber Reservoir. We have
enough funds to build these facilities, enough money in there
to satisfy the implementation of the compact. It's a package
deal that we feel we worked out with the United States
Government, with the State of Montana, including the county
commissioners, the local ranchers, and we think we have done it
for everyone's benefit.
I will answer any questions you might have, and I want to
thank you for the opportunity to testify.
Mr. Doolittle. Thank you very much.
[The prepared statement of Mr. Morsette follows:]
Statement of Jim Morsette, Director of the Chippewa Cree Tribal Water
Resources Department on behalf of the Chippewa Cree Tribe of the Rocky
Boy's Reservation
Chairman Doolittle and Honorable Members of the Committee:
My name is Jim Morsette. I am the Director of the Water
Resources Department of the Chippewa Cree Tribe of the Rocky
Boy's Reservation. I am here to testify on behalf of the Tribe
in support of H.R. 795 entitled ``The Chippewa Cree Tribe of
the Rocky Boys Reservation Indian Reserved Water Rights
Settlement Act of 1999.'' I am accompanied today by the
Chairman of the Tribe, Bert Corcoran, and the Tribe's
attorneys. Thank you for the opportunity to testify in favor of
H.R. 795. I submit, for the record, the Tribe's detailed
written testimony. I would also like to take this opportunity
to express the Tribe's great appreciation to Representative
Rick Hill and his staff, especially Rob Hobart, and to the
Chairman of this Subcommittee, Representative John Doolittle,
and the staff of this Subcommittee, especially Robert Faber and
Josh Johnson, for their hard work and diligence in moving this
bill forward.
H.R. 795 represents a milestone of momentous significance
in the century-long struggle of the Chippewa Cree people to
secure a viable self-sustaining tribal homeland. The bill and
the Water Rights Settlement Compact, which the bill ratifies,
are the culmination of 16 years of technical and legal
research, and negotiation, among the Tribe, the State of
Montana, and the Administration. This bill and the Compact
signal a turning point in the Chippewa Cree Tribe's history,
for these documents set the foundation for the realization of
the Tribe's vision of the Rocky Boy's Reservation as a self-
sustaining homeland for the Chippewa Cree people. The Tribe has
been working toward this end since well before 1916 when the
United States set aside the Rocky Boys Reservation for the
Chippewa Cree people. Implementation of the bill and the
Compact will provide the Tribe with the elements needed to
successfully develop the Tribe's economy--a long-term water
supply sufficient for drinking and agriculture, and funds to
put this water to use. The bill and Compact also represent the
fulfillment of the trust obligation of the United States to the
Chippewa Cree Tribe to provide the Tribe with sufficient water
to enable the Tribe to develop its Reservation into a self-
sustaining homeland for the Chippewa Cree people.
1. HISTORY OF THE TRIBE'S EFFORTS TO SECURE A VIABLE HOMELAND
A. THE LONG ROAD TO ESTABLISHMENT OF A RESERVATION
As early as 1893, our forefathers were petitioning the
United States to set aside a reservation for the Chippewa Cree
people in Montana, who were attempting to live and work in
northern Montana as their ancestors had for centuries before
them. Being without a federally set aside land base, they
became known as and referred to in Montana as the ``landless''
Indians. The Chippewa Chief Rocky Boy and the Cree Chief Little
Bear led these early efforts of our people to secure a
permanent tribal homeland in Montana. In 1902, a petition by
the Chippewa Cree to President Theodore Roosevelt finally
prompted Federal efforts to establish a reservation in Montana.
Those efforts were ineffectual until Federal land became
available with the abandonment of the Fort Assiniboine military
reserve in 1911. Chief Rocky Boy, in a letter on June 14, 1915,
pleaded with Congress to set aside for the Tribe the northern
portion of the military reserve which had the better land and
greatest volume of water.
I and my people are anxious to have a home; to settle down and
become self-supporting. Other tribes have their own land and
homes; we are homeless wanderers. We are anxious to learn to
farm, and if given land that can be farmed and which will be
our own, we will soon be self-supporting.
Regarding the pending legislation to divide up the military reserve
land between the Tribe and the local non-Indian community,
Superintendent Jewell Martin, whose duties included the supervision of
Rocky Boy's band, said predictably:
If they should pass the bill giving only the two south
townships we will still have the Rocky Boy problem, as they
will still have no home.
In 1916, Congress enacted a law setting aside the Rocky Boys
Reservation for the Chippewa Cree Indians on little more than two
townships, about 55,000 acres, in the least productive southern portion
of the abandoned military reserve. About 450 Chippewa Cree people
settled on this Reservation. Consequently, the Reservation from the
beginning did not contain adequate water or land to sustain the Tribe.
The part of the military reserve that contained the best land and the
most water was granted by Congress to the local non-Indian community
for a recreational and sportsmen's park.
B. A WATER-SHORT RESERVATION
From the very beginning, the United States recognized that the 1916
Reservation lacked sufficient land and water to make the Reservation a
viable homeland for the Chippewa Cree Tribe. The Chippewa Cree tried to
farm their Reservation, which was described in Federal Annual Reports
as ``rough, dry unsettled section of old military reserve'' and ``not
suited to farming.'' These reports, from 1918 through the 1930's, were
replete with statements that the Reservation was not suited to farming,
and that irrigation was difficult or not possible and more water was
needed. They said farming would not lead to self-sufficiency; stock
raising was felt to be the only feasible activity, provided enough
winter feed was available. These reports provide a litany of crop
failures due to drought, short season, lack of equipment and horses,
and a picture of dogged perseverance against these formidable odds.
Irrigation was essential to stock-raising as well. The 1937 Federal
Extension Report stated that, besides being the sixth consecutive year
of near complete crop failure:
The cattle industry received a severe blow this year when no
feed was produced to carry the stock through the winter. The
breeding stock was culled very closely and approximately 50
percent of them were put on the market. Three hundred fifty-six
selected cows and one hundred thirty-eight steer calves were
shipped to Dixon, Montana, for winter feeding. Thirty bulls and
three milk cows are the only Indian cattle remaining on the
reservation. The livestock men were very discouraged.
Commissioner Collier lamented that the Reservation was ``entirely
inadequate for the needs of the Indians for whose benefit it was set
aside . . .'' Due to the prevailing unfavorable crop and livestock
conditions, and the lack of irrigable land and water, the Indians and
the United States began to look for ways to enlarge the Reservation.
During subsequent years, various Federal efforts to obtain additional
land and water for the Tribe and to develop the Tribe's agricultural
projects were undertaken. However, these efforts largely failed because
of poor planning and implementation by the Federal Government, and
because of the legal uncertainty over the nature and scope of the
Tribe's water rights.
C. INEFFECTUAL FEDERAL EFFORTS TO SECURE SUFFICIENT WATER FOR THE
RESERVATION
1. Poor Federal Land Purchase Decisions
In the 1930's and 1940's the United States purchased land for the
Rocky Boy's Reservation, adding approximately forty-five thousand
(45,000) acres to the Reservation. Unfortunately, the additional lands
did little to alleviate the Reservation's problems. The lands acquired
were scattered, of poor quality, and were without significant water
resources. The Chippewa Cree still could not raise enough crops or feed
for stock to meaningfully improve reservation conditions. The United
States recognized the Reservation was still wholly inadequate as a
self-sustaining homeland. This is evidenced by the government's 1938
Land Acquisition Plan for the Rocky Boy's Reservation which planned for
a reservation of more than 800,000 acres with access to the Milk River
Irrigation system--a plan which was never implemented.
In the 1930's, the United States took options for the Chippewa Cree
Indians on approximately 30,000 acres, under the submarginal land
program. The intent of this program was to take submarginal land out of
commercial farm production forever. The program was ill-suited to the
Chippewa Cree's needs; the government's ill-advised decision to utilize
the program as a way to obtain more lands for Indians was made worse by
the poor land selections made, when better lands were available. The
government planned to carve up the submarginal lands into subsistence
farms for the Indians. But without water or sufficient irrigable land,
even subsistence farming could not succeed. Before the purchases could
be completed, funding for the submarginal land program fell through and
the options were transferred to the Indian Reorganization Act, which
allowed for purchases of lands to be added to reservations.
The Indian Reorganization Act did not require the purchase of
submarginal lands. Nevertheless, rather than identifying lands better
suited to the Indian's needs, against the recommendations of the
Reservation Superintendent, and over the objections of the Indians and
government personnel, the Indian Office accepted wholesale the badly
scattered options taken under the submarginal land program.
Subsequent purchases were an effort to consolidate the scattered
purchases to simplify fencing and alleviate jurisdictional problems.
Even less attention was given to obtaining irrigable lands with water
rights. In fact, good sources of water were sold or traded away in
efforts to consolidate purchased land through land and lease exchanges.
2. Failure to Obtain and Develop Adequate Water and Land for the Tribe
In 1937, the United States developed a greatly detailed land
purchase plan, which was said to be the result of the collaboration of
all units of the Indian Service, and endorsed by the Tribe. Even
without consideration for a normal population increase, the plan called
for the purchase of an additional 660,000 acres, including 16,000 acres
of irrigated land, at a cost of $5,040,000, to serve the then-existing
Reservation population of 150 families and 400 eligible homeless
families. The purchase area took in part of, and was intended to
benefit from, the Milk River Irrigation System. While never followed,
this plan has apparently never been discarded.
From the beginning, the United States recognized that water for
irrigation was needed, but did little to obtain it. The supervising
engineer investigated Indian water rights and reported in 1926 that
Indian rights were doubtful because of the late date of the
Reservation, and that diversions by Indians from creeks should not be
encouraged. The United States did not make a determination as to
whether this was legally correct; instead the United States deferred
continually to non-Indian interests. Thus, no irrigation project was
ever built or utilized at the Rocky Boy's Reservation.
3. Failure to Provide the Tribe with a Self-Sustaining Tribal Homeland
The United States' mismanagement of tribal resources on the
Reservation was at great expense to the Tribe. Poor land purchase
decisions provide the most egregious example. While more suitable lands
were available, purchased lands either lacked usable water rights or
lacked the quality to support irrigation development. A key example is
the existing Bonneau Dam. This facility could have easily been designed
and constructed, at a reasonable cost, at a greater storage capacity
that could have been utilized to adequately irrigate the Tribe's
cropland. Instead the impoundment was built at 25 percent of the needed
capacity. As a result, the Tribal irrigation project has continuously
suffered from water shortages due to lack of required supplemental
storage water. Yet another example is the chronic past under-
performance of the Tribe's agricultural lands due, among other things,
to lack of training, equipment and water for irrigation. In addition,
thousands of acres of purchased lands were never farmed. The Tribe has
suffered and continues to suffer tremendously, financially and
otherwise from the United States' historic mismanagement of its
resources.
The Federal Government's efforts to secure land and water for the
Tribe diminished over the years. However, the Tribe never ceased to
press forward in its quest for a viable permanent homeland--a critical
goal being to secure rights to sufficient water for its people and its
economy.
II. THE CHIPPEWA CREE TRIBE'S NEED FOR WATER
Presently, the Rocky Boy's Reservation occupies about 125,000 acres
(see attached map of the Reservation and its drainage's). The
Reservation has never been allotted, and all land is held in trust by
the United States for the Chippewa Cree Tribe. The present population
on the Rocky Boy's Reservation is about 3,500. The population is
expected to increase at an average annual growth rate of at least 3
percent. Unemployment on the Reservation is at least 70 percent. The
annual per capita income of a tribal member on the Reservation is
$4,278 as compared to $14,420 for the nation as a whole (based on 1989
dollars). The percentage of tribal members who live below the poverty
level is significantly higher than that of the general population in
the United States.
The current water supply systems on the Reservation were designed
by the Indian Health Service (IHS) with an average day rate of 60
gallons per capita per day (GPCPD). This is significantly below the
current Montana average municipal use rate of 200 GPCPD. It is
estimated that only 1,400 out of 3,500 Tribal people are connected to
the existing system. As such, the primary sources of domestic water are
well systems. Unfortunately, many private Chippewa Cree homes on the
Reservation are using wells that provide poor quality water of limited
quantity. Some of these localized sources are contaminated. These
individuals, when possible, must be hooked up to the municipal system.
The availability of water for domestic and municipal purposes is a
major concern. There is great difficulty in developing reliable wells
from the groundwater aquifers. The quantity of water from the shallow
aquifers on the Reservation is not sufficient for sustained domestic
use. The quality of water from deeper aquifers is not suitable for
domestic use, although such water may have some use in the future for
certain industrial purposes. The IHS acknowledges that long-term future
water supplies must come from imported sources of supply.
Wastewater treatment on the Reservation is provided by either
individual septic systems or by community lagoon systems that are
marginally effective under the current conditions. Because many of the
Tribal wells are located in close proximity to these wastewater systems
and to stock grazing areas, there is a continuing threat to the water
supply from bacterial and viral contamination. Before a chlorination
unit was added to the current Rocky Boy Rural Water System (System) in
March, 1992, boil orders were occasionally imposed on water from the
System due to contamination of one of the system wells. As the
population continues to increase at a relatively rapid pace,
improvements to the wastewater collection and treatment facilities will
be needed to protect existing ground and surface water needs.
Current use, even at the limited IHS per capita usage level,
basically utilizes all of the available developable potable groundwater
supply on the Reservation. There is little potential for expanding the
existing well systems. Present demands, if based on the Montana average
usage rate of 200 GPCPD, cannot be met by either the well field supply
or the capacity of the existing delivery system infrastructure. Supply
is not available to serve the existing population on the Reservation,
much less future water requirements, as demand increases by 243 percent
in the year 2025 and 438 percent in 2045.
H.R. 795 provides funds to enlarge the Bonneau Dam and Reservoir as
well as other minor storage facilities. The Tribe plans to use the
water from the increased storage in Bonneau Reservoir to meet their
current irrigation water storage needs and to increase agricultural
development on the Reservation. However, even storage water from an
enlarged Bonneau Reservoir was to be used to supply drinking water, at
the expense of the Tribe's agricultural economy, the water would be
sufficient only until the year 2025. If per capita use increases to
target levels, then water supply could run out as early as 2016.
Presently, there are a maximum of approximately 1,100 acres of
actively irrigated land on the Reservation utilizing about 2,000 acre-
feet/year (AFY) of water. This acreage includes about 650 acres served
by Box Elder Creek and about 450 acres served by Gravel Coulee and
groundwater. Even this limited acreage does not receive a full water
supply in one out of two years, requiring use of cropping patterns that
include early season water use crops such as barley and wheat. In most
years, considerably less than this noted acreage base is irrigated. The
settlement contemplates the expansion of the Tribal irrigation base
from 1,100 to 2,500 acres through the enlargement of two on-Reservation
reservoirs, Bonneau Reservoir and Towe Ponds. The Compact provides the
Tribe with approximately 7,700 AFY from direct flow, storage, and
groundwater from Big Sandy and Box Elder Creeks to serve the expanded
Tribal irrigation base. It should be noted that the good quality
storage water in an enlarged Bonneau reservoir must be mixed with the
poor quality Missouri Ancestral Channel groundwater resources or the
groundwater supplies cannot be utilized. Without the programmed 1915
acre-feet of groundwater, less than 2,000 acres of land can be
irrigated. If an enlarged Bonneau Reservoir water supply is dedicated
to municipal uses, then the groundwater resources allocated for use by
the Tribe in the Compact for irrigation are lost. This affects about 20
percent of the Tribe's local water rights negotiated under the Compact.
Clearly, a dependable source of high quality water is needed to
enable the Tribe to achieve an adequate standard of living and quality
of life. An adequate supply of water is the cornerstone of economic
development on the Reservation. Without an adequate supply of good
quality water, the Tribe can never achieve its long-standing goal of
economic self-sufficiency.
III. SETTLEMENT OF THE CHIPPEWA CREE WATER RIGHTS CLAIMS--THE COMPACT
AND THE CONGRESSIONAL ACT.
The Tribe's best opportunity to obtain an adequate water supply for
its current and future needs began in 1982 when the United States filed
water rights claims for the Tribe in Montana water court. Subsequently,
the United States, the Tribe and the State of Montana entered into
negotiations to settle the Tribe's water rights claims. The Tribe
constructed a water rights settlement plan to further the ultimate goal
of making the Rocky Boy's Reservation, a self-sustaining homeland. The
settlement plan consists of four main elements: (1) quantification of
on-Reservation water and establishment of a water administration
program; (2) supplementation of the on-Reservation drinking water
supply to meet future population needs; (3) construction of on-
Reservation facilities to deliver drinking and irrigation water; and
(4) compensation for Federal failure to protect the Tribe's water
rights followed by Tribal release of claims against the Federal
Government for such breach of trust. The Tribe's settlement plan would
require negotiation of a Compact with the State of Montana settling
issues of quantification and administration of on-Reservation water
supplies. The plan would require enactment of the bill before you today
to ratify the Compact, provide a source of water to supplement the
short water supply on the Reservation, authorize the construction of an
on-Reservation distribution and irrigation system, and provide an
economic development fund.
A. THE CHIPPEWA CREE-MONTANA COMPACT
In 1982, pursuant to state law, the Federal Government filed water
rights claims in Montana water court for the Chippewa Cree Tribe. The
Tribe then notified the State of Montana that the Tribe wished to
negotiate a settlement of its water rights claims. At that point, the
State water court stayed proceedings on the Tribe's claims pending
settlement negotiations involving the Tribe, the State and the United
States. The Tribe then commenced the formidable task of negotiating a
compact with the State of Montana and the United States which settles
its water rights claims.
On April 14, 1997, after 10 years of extensive technical studies
and five years of intensive negotiations, the Chairman of the Chippewa
Cree Tribe and the Governor of Montana signed an historic water rights
compact between the two governments. The Chippewa Cree-Montana Compact
accomplished the first element of the Tribe's settlement plan--it
quantifies the Tribes water rights and establishes a joint Tribe/State
water administration system. The Compact was ratified by the Tribe on
February 21, 1997 and was approved by the Montana Legislature on April
10, 1997. The Chippewa Cree Tribe thus became the third tribe in
Montana, after the Northern Cheyenne Tribe and the Assiniboine & Sioux
Tribes of the Fort Peck Reservation, to agree to a water rights compact
with the State. However, with few exceptions, all provisions of the
Compact are subject to approval by the United States Congress.
The Compact establishes the Tribe's water rights to the Big Sandy,
Box Elder, and Beaver Creeks on the Reservation, and contemplates
tribal rights to supplemental water for drinking. The Compact provides
for 9,260 AFY from the Big Sandy Creek and its tributaries, and 740 AFY
from Beaver Creek. The Tribe reserves the right to divert from surface
water flows for irrigation and other uses from the Lower Big Sandy
Creek, Gravel Coulee, and from Box Elder Creek. Additional water for
irrigation provided by the Compact will enable the Tribe to expand its
irrigation base from 1,100 acres to 2,500 acres. On Beaver Creek, the
Tribe reserves the right to divert from surface water flows for
recreational uses, subject to a requirement that 280 acre-feet be
returned to the stream. The Compact does not address broad issues of
jurisdiction over water quality. The Compact does address specific
water quality concerns raised by non-Indian water users in provisions
that provide (1) for Tribal releases of reservoir water for water
quality maintenance on Lower Big Sandy Creek for downstream stock
watering purposes (Article IV.B. 1. c&d.), and (2) for the
establishment of a joint Tribal/State system for monitoring salinity
levels of surface and groundwater associated with the contemplated
enlargement of Towe Ponds (Article IV.B.2.b.).
The Compact also calls for Tribal administration of its water
rights. The Compact specifies that any change in water use must be
without adverse effect on other water users. To resolve disputes
concerning water use between Tribal and non-tribal water users under
the Compact, a pre-adjudication Tribal/State administrative process is
established, and an adjudicatory process is established consisting of a
Compact Board made up of three members: one Tribal, one local off-
Reservation, and one chosen by the other two.
The Administration, while supportive of the quantification aspects
of the Compact, declined to sign the Compact for the United States
primarily because the issue of a supplemental water supply for the
Tribe had not been resolved. With the signing of the Compact,
Congressional legislation became the next step. This necessarily
involved continuing negotiations with the Administration to obtain its
support.
B. CONGRESSIONAL ACTION IS NEEDED TO RATIFY THE COMPACT, PROVIDE
ADDITIONAL SOURCES OF WATER FOR THE TRIBE, AND PROVIDE COMPENSATION FOR
THE TRIBE'S RELEASE OF BREACH OF TRUST CLAIMS AGAINST THE UNITED STATES
The Chippewa Cree-Montana Water Rights Compact, intended to
permanently settle all existing water rights claims of the Chippewa
Cree Tribe in the State of Montana, accomplishes one important element
of the Tribe's settlement plan. The remaining three elements--
supplementation of the on-Reservation drinking water supply to meet
future population needs; construction of on-Reservation facilities to
deliver drinking and irrigation water, and compensation for Federal
failure to protect the Tribe's water rights followed by Tribal release
of claims against the United States--must be obtained through
congressional action. In addition, congressional ratification of the
Compact is needed to confirm the quantification of the Tribe's water
rights under that agreement. Because of the permanence of the
settlement, once secured by congressional legislation, the Tribe seeks
a settlement that provides not merely for its present water needs, but
also for its future water needs.
Accordingly, each and every provision of H.R. 795, entitled ``The
Chippewa Cree of the Rocky Boy's Reservation Indian Reserved Water
Rights Settlement Act of 1999,'' was negotiated among the Tribe, the
State and the Administration over a period of one year. Thus, H.R. 795
has the support of all three parties--the first water rights settlement
to have such support. The bill would accomplish the following:
1. Ratify the Chippewa Cree-Montana Water Rights Settlement
Compact providing 10,000 AFY from surface and groundwater
sources on the Reservation.
2. Authorize the appropriation of $3,000,000 to the Tribe to
perform its administration obligations under the Compact, such
as the installation and maintenance of Compact-required water
gauges, and the staff costs associated with administration of
the Tribe's Compact-related obligations. However, except for
$400,000 for capital expenditures, the Tribe may expend only
the interest on this fund for Tribal Compact administration
obligations.
3. Authorize the appropriation of $25,000,000 to the Department
of the Interior for the Bureau of Reclamation for the
construction of certain on-Reservation water development
projects, including the enlargement of Bonneau Dam and other
designated on-Reservation dams. The Tribe expects to assume
responsibility for this work under its Self-Governance Compact.
The Tribe and the Bureau of Reclamation have negotiated the
terms of an agreement as to the Bureau's oversight role in this
work.
4. Authorize the allocation of 10,000 AFY from Lake Elwell
located behind Tiber Dam, a Bureau of Reclamation project,
approximately 50 miles from the Reservation on the Marias
River, to provide a source of future drinking water supplies
for the Tribe. Lake Elwell has a capacity of almost 1 million
acre-feet. Average annual inflows to Lake Elwell exceed 700,000
acre-feet per year. Roughly 400,000 acre-feet of this capacity
is in the active storage pool, thus available for release to
downstream use. The Bureau currently has entered contracts for
the allocation of less than 8,000 acre-feet per year. This is
due to the fact that the original Pick-Sloan plan was based on
the reservoir serving 120,000 acres of new irrigated land, of
which essentially none has been developed. The 10,000 acre feet
in Lake Elwell replaces on-Reservation reserved water rights
claims, which, under the water settlement, are released by the
Tribe to satisfy existing water needs of downstream non-Indian
water users. The Tribe's Lake Elwell water rights are not
Winters/reserved water rights. The rights are BOR project water
rights assigned to the Tribe in perpetuity by H.R. 795. Under
the Compact, the Tribe can market its Lake Elwell project water
rights for use off the Reservation. However, such marketing is
expressly subject to applicable state law. See, 85-20-601, MCA
(1997), Article IV.A-4.b.(1) and Article VI.A.1. In addition,
the Compact provides that any such marketing shall not exceed
100 years; shall not be permanent; and shall not be transferred
to a location outside the Missouri River drainage. See, id,
Article IVAA.b. And further, the Compact gives Milk River water
users the right of first refusal in any marketing of Lake
Elwell water rights outside of the Milk River drainage. See,
id, Article IV.A.4.b. If any precedent is set by the Chippewa
Cree water rights settlement as to the right of tribes to
market water off the reservation, it is only that such rights
must be negotiated with the affected states and non-Indian
water users to mitigate any concerns raised, to the
satisfaction of all parties. The allocation of Lake Elwell
water does not impose on the United States a present obligation
to develop or to transport the allocated water to the Rocky
Boy's Reservation. However, the bill authorizes other
appropriations intended to pave the way for the future
importation of water to the Reservation.
a. $1,000,000 is authorized to be appropriated to the
Department of the Interior, through the Bureau of
Reclamation, to perform a municipal, rural, and
industrial feasibility study of water and related
resources in North Central Montana for the purpose of
evaluating alternative means of transporting needed
water to the Reservation. ($3,000,000 is authorized to
be appropriated to the Department of the Interior for a
regional feasibility study of water and related
resources in North Central Montana.)
b. $15,000,000 is authorized to be appropriated to the
Department of the Interior for the Tribe, to be used as
seed money for future water supply facilities needed to
import drinking water to the Rocky Boy's Reservation
consistent with the agreement of the Tribe, the State,
and the United States that importation of water is
necessary to meet the current and future drinking water
needs of the Tribe. However, the Tribe expects that it
will be required to return to Congress in the future
for additional moneys to fund the final design of a
future water importation system.
5. Authorize the appropriation of $3,000,000 for a Tribal
economic development fund.
The Tribe may expend the funds appropriated for the Rocky Boy's
Reservation feasibility study and for Tribal Compact administration
obligations immediately upon appropriation. However, all other funds
may not be expended by the Tribe until a final decree is entered by the
Montana water court dismissing the Tribe's water rights claims. Upon
entry of the final decree and appropriation of the funds authorized by
H.R. 795, the Tribe's waiver and release of damages claims against the
United States will become effective.
The history of the United States' breach of trust toward the
Chippewa Cree Tribe--poor land choice decisions, poor land management,
and failure to obtain sufficient water for, or to protect the little
water available to, the Rocky Boys Reservation--justifies a substantial
Federal contribution to the Chippewa Cree water settlement in the form
of authorization of Federal projects and an economic development fund.
By enacting H.R. 795, the United States will at long last set a firm
foundation for providing sufficient water to support the Rocky Boy's
Reservation as a viable, self-sustaining homeland for the Chippewa Cree
Tribe.
IV. CONCLUSION
H.R. 795, pending before this Committee today, represents the
culmination of many years of hard work on the part of many people. The
bill has the support of the Tribe, the State of Montana, and the
Administration. It ratifies a water settlement Compact that has the
support of the State of Montana, the Tribe's non-Indian neighbors, and
the Tribe. And it resolves the Tribe's water right related claims
against the United States in a fair and reasonable manner. The Chippewa
Cree Tribe urgently requests that H.R. 795 be enacted into law during
this first session of the 106th Congress.
Mr. Doolittle. The Committee will stand in recess for 15
minutes or until we return, whichever is earlier.
[Recess.]
Mr. Doolittle. The Committee will reconvene.
Mr. Hill is recognized for his statement.
STATEMENT OF HON. RICK HILL, A REPRESENTATIVE IN CONGRESS FROM
THE STATE OF MONTANA
Mr. Hill. Thank you, Mr. Chairman. I want to thank you for
holding the hearing. I am pleased the Committee has scheduled a
hearing on H.R. 795.
I introduced this bill on February 23rd, and I am pleased
that Senator Burns and Senator Baucus from Montana also
introduced companion bills at the same time.
This bill is a culmination of many years of work and
negotiations in the state, delicate negotiations, and it will
result in the Federal Government sanctioning this water rights
compact that has been adopted by the Montana State Legislature.
The settlement may represent, in my view, a textbook
example of how a state, tribal governments, local government,
private landowners together with on and off-reservation local
communities can sit down and resolve our differences.
I am also pleased that local ranchers were involved in
every step of the negotiations. This is how we like to do
things in Montana.
So I look forward to us moving the bill out of the
Subcommittee and completing the long and dedicated journey by
all the parties that have been involved. I want to thank all
the panelists from Montana for being here, their dedication,
their work, their willingness to cooperate with us to try to
address issues as they have arisen in the process, and I remain
optimistic that we are going to be able to get this done in
this Congress.
I thank you, Mr. Chairman.
Mr. Doolittle. Thank you.
Our next witness will be Mr. Chris Tweeten, chief counsel
to the Montana Attorney General, chairman of the Montana
Reserve Water Rights Compact Commission. Mr. Tweeten.
STATEMENT OF CHRIS TWEETEN, CHIEF COUNSEL TO THE MONTANA
ATTORNEY GENERAL, CHAIRMAN, MONTANA RESERVED WATER RIGHTS
COMPACT COMMISSION
Mr. Tweeten. Thank you, Mr. Chairman. I am pleased to be
here this morning on behalf of Governor Marc Racicot and the
State of Montana to testify in support of H.R. 795, the Rocky
Boy's Montana Water Rights Compact.
I do have a written statement which I believe I have
submitted previously that I would like to make part of the
record.
Mr. Doolittle. Several have mentioned that. Let me assure
you all your full written statements will be made part of the
official Committee record.
Mr. Tweeten. Thank you, Mr. Chairman. I do have three
points that I would like to cover briefly in my oral remarks.
First, from Montana's perspective, we believe that this
compact illustrates the value of locally crafted solutions to
western water allocation problems. We believe that not all
western states are like eastern states with respect to their
water use problems and not all western states are alike either.
Solutions that work in highly populated water short areas in
Arizona and California will not always work in Montana, and
solutions that are good for the largely agricultural economies
of north central Montana may not be suitable for solving water
problems in other areas.
We believe Federal policy must encourage states and tribes
to work out local solutions to these issues, solutions that are
tailored to the very economic, geographic and demographic
issues that exist throughout the West. This compact is an
excellent example of an agreement that the Federal policy
should support. We have crafted a compact that provides for the
foreseeable water needs of the tribe and by creative use of
state-contributed cost share we have mitigated any potential
impacts on existing non-tribal uses.
Briefly, this compact makes storage of spring flow the
centerpiece of the tribe's water right. The water availability
situation in north central Montana is such that most of the
water comes out of the mountains in the springtime as a result
of snow melt and much of it is gone by the early part of the
summer. If that storage can be captured and held for use later
on in the summer, it makes much more water available for all of
the parties to use.
State cost share will allow for improved efficiencies of
diversion structures on Big Sandy Creek, mitigating the effect
of this increased storage which goes for the benefit of the
tribe and allows the tribe to capture those and use those
spring flood flows without adverse impact on downstream users.
In addition, state cost share also allowed for the purchase
of stored water from a facility that is owned by Hill County
downstream from the reservation to mitigate the impact of
upstream tribal uses, and those uses include in-stream uses
that are designed to provide environmental mitigation and to
protect fisheries in Beaver Creek. We think this is an
excellent example of the way that states and tribes can
cooperate together in crafting solutions that satisfy the needs
of both parties.
Second, Mr. Chairman, I would like to emphasize the fact
that this agreement has broad and deep support among those that
are directly affected by its provisions, the members of the
tribe and the local area ranchers in the Big Sandy and Beaver
Creek drainages.
As Congressman Hill has mentioned, as Mr. Hayes has
mentioned, this has been a long process in which we have spent
a tremendous amount of time and effort working with local
ranching communities, many of whom were quite skeptical early
on in this process about the potential for success in reaching
an agreement that was going to be beneficial to them.
Many of those skeptics are now among the strongest
supporters of this compact. That is a result of hard work on
the part of our staff, on the part of the Federal team, on the
part of the tribal negotiating team, and also a result of the
willingness of the local ranchers to maintain a flexible
viewpoint towards these issues. We think that this cooperation
that is fostered as a result of this agreement is going to show
benefits in other areas as well as we work through other issues
of contention between the state and the tribe.
Third, it's important to emphasize how this compact
integrates administration of tribal water rights into a state-
based water administration system. As you know, there are much
different legal attributes to Federal reserve water rights and
those water rights that exist under state law, and frequently
in litigated outcomes the results are not very satisfactory
because those issues of administration, that is, how you are
going to take these different animals and put them together
into one comprehensive administration system, can't be
addressed in litigation. That is one of the benefits of
reaching these solutions through negotiation.
In this compact we have reached an administrative solution
that downplays the importance of priority and thus minimizes
the potential for conflict between tribal users and non-tribal
users, and we have also created an alternative dispute
resolution process that provides a quick and inexpensive means
of resolving those disputes should they arise in the future. We
think that is a very important feature of the compact.
Mr. Chairman, I appreciate the opportunity to be with you
this morning. I would be happy to answer your questions.
[The prepared statement of Mr. Tweeten follows:]
Statement of Chris D. Tweeten representing the State of Montana on H.R.
795
Chairman Doolittle and members of the Subcommittee, my name
is Chris Tweeten. I am the Chief Counsel to the Montana
Attorney General and the Chairman of the Montana Reserved Water
Rights Compact Commission. I am here to testify on behalf of
the State of Montana and Governor Marc Racicot in support of
House Bill 795, the Chippewa Cree Tribe of the Rocky Boy's
Reservation Indian Reserved Water Rights Settlement Act of
1999, and to urge your approval of the Act. I would like to
express my appreciation for the time the staff of this
Subcommittee has taken over the past year to meet with
representatives of the State, Tribe, and the Administration to
reach an understanding of the provisions of the Act. The
purposes of the Act are to: ratify the Compact which settles
the quantification of the Tribe's water rights in Montana;
provide the necessary authorization for implementation of the
Compact; and to settle Federal liability regarding the Tribe's
water resources by authorizing appropriations for their
development. My testimony will focus on the Compact and the
value of negotiated settlements.
I cannot overstate the importance of the Settlement Act to
the State of Montana. The unquantified and open ended nature of
reserved water rights places a cloud over the certainty
regarding investment in private water development throughout
the west. The Compact Commission was established by the Montana
Legislature in 1979 to act on behalf of the Governor to
negotiate the settlement of reserved water rights as part of
the state-wide general stream adjudication. The policy of the
State of Montana in favor of negotiated solutions to
quantification of tribal water rights recognizes the need for
individual, site specific solutions to water supply and water
allocation problems. We believe that negotiation gives us the
greatest control over the outcome since agreement to a
settlement is purely voluntary. It also allows consideration of
the fact that each tribe is unique in its culture, history,
water needs and potential for conflict over water use with its
neighbors, and that every basin has unique avenues for
enhancement of water supply. We have found through years of
experience that the best approach to resolving that uncertainty
is through negotiated settlements that allow tailoring of
solutions on a site specific basis. In Montana, we have
successfully settled the water rights claims of three Indian
reservations, five National Park units, three Fish and Wildlife
refuges and two wild and scenic rivers. In each of these
settlements we have protected existing water use while meeting
the needs of the particular reservation.
Resolution 98-029 of the Western Governors Association
expressing a preference for negotiated settlement of reserved
water rights is attached to my testimony. If you look closely
at the west, it is not difficult to see why we favor
negotiation, an approach that provides an avenue for the use of
the uncertainty in the law to craft unique solutions tailored
to a specific location. Westerners are not one people. We are
influenced by our landscape to a degree not found in the east,
and that landscape is diverse. Our climate, even in
agricultural areas, varies from desert to rain forest. The
portion of the Rocky Boy's Reservation suitable to agriculture
receives an average of 12 inches of rain per year. Our growing
season is as short as 45 days in the Centennial Valley of
Montana. Water, valued as high as $1,000 per acre foot by urban
areas in the southwest, cannot be sold in agricultural areas of
Montana when priced at $10.50 per acre foot.
The Compact before you for ratification is uniquely
tailored to meet the needs of the citizens of Montana. The
site-specific nature of the solutions in the Compact may render
them inappropriate if applied elsewhere. That is the nature of
a negotiated solution. It is not an exact science. President
George Bush, in proposing that the Department of the Interior
promulgate guidelines for the settlement of Indian reserved
water rights, stated:
Indian land and water rights settlements involve a complicated
blend of law, treaties, court decisions, history, social
policies, technology, and practicality. These interrelated
factors make it difficult to formulate hard-and-fast rules to
determine exact settlement contributions by the various parties
involved in a specific claim.
A uniform approach to analysis of Indian water rights settlement,
or an overlay of new pre-requisites to settlement, would adversely
impact negotiations throughout the west. The need for Congressional
ratification of each settlement allows review on a case-by-case basis,
thus eliminating the need for uniform standards. A chill in
negotiations has already been felt by western states due to the
reluctance of Congress to ratify this Compact last year. I strongly
urge you to help us move this forward and send a signal to western
states that Congress will not stand in the way of the settlement of
reserved water rights.
The Tribal Water Right created by the Compact and the Act is a
settlement right and its attributes should not be considered to
represent a legal interpretation of how the rights of the Tribe would
be interpreted should they be litigated in court. Negotiation differs
from litigation. The focus in negotiation is on finding a compromise
that meets the needs of the Tribe and can therefore be approved by
their Council, while, at the same time, protecting investment in state-
based water rights. In litigation, downstream junior water wers can
expect no protection for their water rights.
The following paragraphs will briefly describe some of the unique
aspects of the agreement and their relation to water use on private
land in Montana. A summary of the Compact and the authorizations for
appropriations in the Settlement Act is attached to my testimony.
The Rocky Boy's Reservation is one of four Indian Reservations with
land and water right claims in the Milk River Basin. The Milk River has
its headwaters in Glacier National Park, then flows onto the Blackfeet
Reservation where it receives water from another basin as part of one
of the United States' first Reclamation Projects--The Milk River
Project. The Milk River, with its enhanced water supply, then flows
into Canada where it cuts through the Provinces of Alberta and
Saskatchewan before re-entering the United States. It is downstream
from this point of re-entry that the Milk River serves seven irrigation
districts as part of the Milk River Project. Considerably downstream
from its beginning, the Milk River forms boundaries to both the Fort
Belknap and Fort Peck Indian Reservations. It is one of the most
heavily used and re-used rivers in the United States, and is estimated
to be water-short in as many as 5 out of 10 years.
The Rocky Boy's Reservation is located in the Bearpaw Mountains on
two tributaries to the Milk River: Big Sandy and Beaver Creeks. The
Reservation is home to over 3,500 Tribal members who are also citizens
of Montana. The Reservation has an estimated 70 percent unemployment
rate. The Reservation is located in an area of scarce water supply. The
drinking water system on the Reservation is currently inadequate,
providing only 60 gallons per capita per day to households served,
compared to a Montana average of 170. Not all households on the
Reservation share in even this inadequate supply. Because groundwater
is of poor quality and low yield in this region of Montana, many of the
surrounding communities and ranches rely on treated surface water for
their drinking water supply. The Reservation lags behind the region in
the development and treatment of surface water for domestic purposes.
The Compact provides a settlement quantification of 20,000 acre-
feet per year. Unlike the farmland irrigated by the Milk River Project
along the bottomland of the mainstem, tributary water use is associated
primarily with cattle grazing and growing of hay. Without the storage
provided by the Milk River Project, streamflow is intermittent with
large spring floods and late summer drought. The provisions in the
Settlement Act providing for on-Reservation storage and development
will allow the Tribe to maximize the utility of this limited water
supply by providing a reliable supply of irrigation water for
approximately 2,500 acres of Reservation land. On-Reservation water
development authorized by H.R. 795 involves enlargement of existing
storage on the two dominant drainages on the Reservation, Beaver Creek
and Box Elder Creek (a tributary to Big Sandy Creek).
The Rocky Boy's Reservation shares Big Sandy Creek with
approximately 8,500 acres of irrigated private land located off the
Reservation. On Beaver Creek, there are approximately 3,600 acres of
off-Reservation private irrigation. The growing season is short. Small
scale storage projects that will capture some spring run-off, such as
those authorized on the Reservation by this bill, are the best way to
enhance water supply. To prevent impact by those projects on water use
on private land, the State has funded local improvements in conveyance
and diversion structures and is promoting improved management of
existing storage. Description of the specific measures taken to prevent
impact on private water use by development of water on the Reservation
follows.
The enlargement of the Tribe's Bonneau Reservoir on Box Elder Creek
will enhance stream flow during late summer, but will reduce spring
flow that is generally relied on by irrigators downstream on Big Sandy
Creek. A State grant will be used to improve conveyance and diversion
structures off the Reservation so that water users may operate on the
lower spring flows anticipated once the Tribe enlarges existing storage
on the Reservation. In addition, a 240 acre-foot pool of water will be
held in Bonneau Reservoir to be released during late summer to maintain
water quality for stockwatering that might otherwise be impaired by low
quality irrigation return flow.
Increased storage and diversion from Beaver Creek on the
Reservation could impact downstream irrigators with a senior right to
divert from natural stream flow. Coordinated use of reservoirs on and
off Reservation will mitigate impacts on downstream senior water
rights. However, release of water from the small reservoir on the
Reservation for irrigators with operations over fifteen miles
downstream would be highly inefficient due to conveyance loss, and
would prevent realization of the Tribe's development plan. Lower Beaver
Creek Reservoir, owned by Hill County and located downstream from the
Reservation, had contract water available for sale when contracts were
renewed in 1996. Pursuant to the Compact, the State entered an Option
to Purchase contract water for release to mitigate impacts from
development of the Tribe's right. In effect, this transfers any
``call'' for water by senior water users from the Tribe's diversions to
Lower Beaver Creek Reservoir.
Beaver Creek Park is owned and operated by Hill County, and is
located immediately downstream from the Reservation on Beaver Creek. It
is a natural park with camping and an important brook trout fishery. A
minimum instream flow is necessary to maintain a viable fishery. The
Compact includes provisions for release of water from the Tribe's
enlarged East Fork Reservoir to maintain a minimum flow. In addition,
the Compact includes an agreement by the State and the Tribe to jointly
study the streamflow and the needs of the fishery to more precisely
define the minimum flow.
In addition to protection of state-based rights, Montana has
strongly asserted that in negotiating water allocation solutions, it
will not pit tribe against tribe. In settling, we considered the rights
of the Gros Ventre and Assiniboine Tribes of the Fort Belknap
Reservation located downstream from the Rocky Boy's Reservation on the
Milk River. As a practical matter, the impact from use of water on
tributaries to the Milk River by the Chippewa Cree Tribe will not have
a measurable impact on the flow of the Milk River. Furthermore, release
of the water purchased from Lower Beaver Creek Reservoir by the State
will help prevent impact on the Milk River on which Fort Belknap
relies.
Negotiation allows the State to settle issues that, in litigation,
would be left for another day. The Compact contains provisions on
administration that should reduce the potential for future conflict
between the Tribe and its neighbors and expedite the process of dispute
resolution during critical periods such as the irrigation season.
First, the Compact addresses transfers of the Tribal Water Right. Under
State law, water users may market appropriative water rights.
Consistent with that attribute of water rights arising under State law,
the Compact provides that the Tribal Water Right may be transferred off
the Reservation. However, off-Reservation use of the Tribal Water Right
subjects it to full compliance with State law. Thus, pursuant to
Article IV.A.4.b. of the Compact any off-Reservation use or transfer of
any portion of the Tribal Water Rights must comply with state law for
both water use and diversion facilities. In addition to state law
protections, the Compact limits marketing of the Tribal Water Right to
the Missouri River basin and gives water users on the water-short Milk
River a right of first refusal for any marketing of tribal water.
Article IV.A.4.b.
Second, to avoid daily administration between the Reservation and
off-Reservation water users in dry years, water is allocated as a block
for each tributary on which there is both private and Reservation land.
Montana, as with most western states, allocates water in times of
shortage in order of priority of the date of development. In dry years,
junior priority water users must curtail or cease water use so that
senior rights are satisfied. This requires close monitoring of stream
flow and coordination of diversion. The Compact eliminates priority
administration between the Tribe and other water users. Provided the
Tribe is using water within its allocation, water users off the
Reservation agreed not to assert priority over the Tribe's water.
Similarly, provided water users off the Reservation are using water
within the amount of their right, the Tribe agreed not to assert
priority over state-based rights. To give effect to the allocation by
preventing further demands on a short water supply, the drainages are
closed to new penrnits for water use under state law. This approach
minimizes the interaction necessary and, therefore, the potential
interference with the jurisdiction of each sovereign to manage its
water.
Third, in the event a dispute does arise, the Compact provides for
an initial effort between the water resource departments of the State
and the Tribe to resolve the dispute. Should the informal process fail
to reach resolution, the Compact establishes a Compact Board with both
Tribal and off-Reservation representation to hear disputes. Decisions
may be appealed to a court of competent jurisdiction.
The Compact provides for full settlement to claims of the Chippewa
Cree of the Rocky Boy's Reservation to water within the State of
Montana. The Compact includes a release of all claims stating:
``The parties intend that the water rights and other rights
confirmed to the Tribe in this Compact Are in full satisfaction
of the Tribe's water rights claims, including Federal reserved
water rights claims based on Winters v. United States, 207 U.S.
564 (1908). In consideration of the rights confirmed to the
Tribe in this Compact, . . . the Tribe and the United States as
trustee for the Tribe hereby relinquish any and all claims to
water rights of the Chippewa Cree Tribe within the State of
Montana existing on the date this Compact is ratified by the
State and the Tribe, whichever date is later.
The State of Montana concurs with the Chippewa Cree Tribe and the
Administration that this is a fair and equitable settlement that will
enhance the ability of the Tribe to develop a sustainable economy while
protecting existing investments in water use by off-Reservation
ranchers who rely on state-based water rights. We appreciate the
efforts of both the Tribe and the Administration to work with us in
reaching this agreement and, in doing so, to listen to and address the
concerns of water users off the Reservation.
The Compact has the full support of local ranchers, farmers, and
elected officials. Arriving at these unique solutions involved the most
intensive process of public involvement undertaken by the Commission to
date. Because both the timing and volume of stream flow on the two
drainages shared with the Reservation is so constrained, it was
essential for the Commission to understand the water needs of each
rancher and to engage them in the process of designing solutions.
Public involvement began in 1992 with a public meeting in which over
200 citizens attended. Following that meeting the Commission began a
five year process of kitchen table meetings with individuals ranch-by-
ranch. Out of this process, trust and mutual respect developed. Many of
the solutions suggested by ranchers are now found in the Compact. The
same ranchers who expressed concern in 1992 testified in support of the
Compact during legislative hearings in 1997. The value of this Compact
in improved relations between neighbors on and off the Reservation
alone is unquantifiable. The Compact received overwhelming support in
the Montana Legislature. The level of support reflects the fact that
this is truly a settlement that addresses the needs of all those
affected. The Compact was ratified by the Montana Legislature without
opposition and is codified in the Montana statutes at 85-20-601, MCA.
I appreciate the opportunity to testify on behalf of the State of
Montana in support of the Chippewa Cree Tribe of the Rocky Boy's
Reservation Indian Reserved Water Rights Settlement Act of 1999, and
urge your timely approval of the Act. The settlement has the full
support of the State, the Tribe, ranchers, surrounding communities, and
local officials in the area. Because it relies on enlargement of
existing storage and mitigation of impacts of new development through
efficiency improvements, it has no environmental opposition. No
endangered species are known to be involved. We know of no opposition
to this settlement. On behalf of Montana I urge you to pass this bill
and thereby signal to western states that the United States, after a
long hiatus, is once again prepared to help us move toward finality on
resolving these Federal claims in our adjudications, rather than
opening these issues to further uncertainty and protracted debate.
Passage of this Act will help us bring this long process of settlement
to closure. I would be happy to answer any questions by members of the
Subcommittee.
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Mr. Doolittle. Thank you.
Our final witness is Mr. Roger Fragua, manager, American
Indian affairs, Enron Corporation. Mr. Fragua.
STATEMENT OF ROGER FRAGUA, MANAGER, AMERICAN INDIAN AFFAIRS,
ENRON CORPORATION
Mr. Fragua. Good morning, Mr. Chairman, Representative
Hill, staff, tribal leaders, and other honored guests. It is a
real pleasure to be invited to address you this morning on an
issue that is so politically, professionally and personally
important to me.
In addition to my submitted written testimony, which I hope
you have a chance to review, I would like to offer these brief
verbal comments.
For the record, my name is Roger Fragua. I am from the
Pueblo of Jemez, which is a small but traditional tribe located
about 50 miles northwest of Albuquerque, New Mexico, in the
arid southwest. I've had the honor of serving my tribe as an
administrator for several years and continue to hold a strong
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sense of commitment to my tribe and the Indian country in
general.
Serving my tribe as administrator, one of my chief
responsibilities has been community and economic development.
The traditional process of economic development at my tribe and
others is one that generally is coined as the ``deal of the
week'' where oftentimes a non-tribal developer brings an idea
or a concept to our tribe that utilizes our natural resources,
captured labor force, and political status, oftentimes in
exchange for royalty position far removed from full economic
potential.
As a tribal member I am interested in enhancing this
process and building more self-sufficient, self-sustaining and
self-determined economic development.
In 1997 our tribe took a more holistic approach to
development, to include an assessment of our tribal resources,
position, and the community's desires for economic development.
We began with a critical assessment of our utility
infrastructure. Jemez has no natural gas distribution to our
community; we pay some of the highest rates for electricity in
the state; and water continues to be a health issue for our
community to deal with. With this deck of cards it's hard to
become a real player in a meaningful development.
Our tribal council created a working conference centered on
electricity. Since we learned that the industry was headed
toward deregulating itself, we wanted to discern our
opportunities and challenges in a deregulated market. It was
then that we learned that there are opportunities for tribes,
and I had the pleasure of meeting Christy Patrick, the vice
president at Enron. I learned that Enron is the world's leading
energy company with vast financial and physical assets, but
most importantly, intellectual resources that could bring
incredible creative solutions to some of our tribal issues and
concerns.
After several discussions with my tribal leadership, we
carved out a loan program where I could go to Enron and learn
more about the energy industry and bring that knowledge and
experience to my tribe and share it with many other tribes as
well.
Together we created the American Indian Affairs Group,
which is a distinct commercial group within Enron to promote
Enron and tribal partnerships. In fact, Enron has already had a
long history of working with tribes responsibly that evolved
over a relationship of necessity such as permitting and right-
of-way transactions to our more current proactive process of
building real partnerships with tribes.
The partnership concept consists of the strengths and
challenges that each of the entities bring to create a more
strong and complete whole. We know and understand that tribes
bring market, customer bases, natural resources, regulatory and
tax advantages, and industry brings financing capabilities,
market risk management, technical and operational expertise.
This is very exciting and well received in Indian country thus
far.
We feel that our experience in energy development working
with tribes can be transferred to water with the recent
addition of Azurix, our new water company.
As we have already discussed with the Chippewa Cree Tribe,
our proposal is simple. We work with our prospective tribal
partners to conduct a joint assessment of the tribe's resources
and potential commercial opportunities and move forward in a
partnership mode with the tribes to create economic development
that is more culturally, environmentally and economically sound
for both parties.
We look forward to working with the Cree Tribe and their
water opportunities that the water settlement may bring them.
Thank you for the opportunity to address this panel.
[The prepared statement of Mr. Fragua follows:]
Statement of Roger Fragua, Manager, American Indian Affairs, Enron
Corp.
Mr. Chairman, Members of the Subcommittee, and honored
guests here today, my name is Roger Fragua and I am manager of
American Indian Affairs for Houston, Texas-based Enron Corp. I
am honored to appear before the Subcommittee today and thank
you for the opportunity to testify at this hearing on two areas
of increasing interest to Enron: American Indians and water.
Enron is one of the world's leading energy companies, with
special emphasis in natural gas and electricity, but with
rapidly growing interests in markets for other commodities and
services such as water and telecommunications. Enron owns
approximately $30 billion in energy related assets, produces
electricity and natural gas, develops, constructs and operates
energy facilities worldwide, delivers physical commodities, and
provides risk management and financial services to customers
around the world.
Enron is consistently recognized as a leader in the energy
industry not only measured by financial and physical assets,
but by our vast intellectual resources. Our intellectual
resources create new and emerging markets, products and
technologies that consistently create positive global impacts.
In North America, one market in which Enron is very actively
engaged is American Indian Tribes and reservations. To promote
this market, Enron's organization includes a distinct
commercial business unit: Enron American Indian Affairs.
In fact, Enron has a long history of responsibly working
with many American Indian Tribes. Our involvement began many
years ago when Enron was largely a gas transmission company
with pipelines crossing many miles of Indian lands,
participating in numerous amicably negotiated settlements of
rights-of-way and permits. From this friendly and mutually-
respectful relationship with several Tribes, Enron's
involvement in Indian Country has evolved to the current
independent proactive business unit that is joining together
Enron with Indian Country as multifaceted partners in energy
projects.
We value our Tribal relationships and are working toward
enhancing the Tribal capacity in order to build strong business
partnerships. For example, to assist in developing strong
Tribal energy partners, Enron embarked on an energy education
program throughout Indian Country, sponsoring energy
conferences among regional groups of Tribes, as well as for
individual Tribes. These conferences included not only
presentations by Enron and other energy companies, but
facilitated work sessions exclusively for Tribal leadership,
where Tribal participants could map out self-determined energy
strategies, in order to position the Tribe to partner equally
with corporate America. Enron continues to sponsor this
conferencing effort, and we believe that when Tribes have
determined their energy strategies, Enron will prove itself to
be the best energy partner of choice for Indian Country as we
can tailor energy services to meet special Tribal needs. That's
what competition is all about--being responsive to the
customer, in this case the Tribe.
As result of this effort, today Enron American Indian
Affairs is working as energy partners with several Tribes
throughout North America to develop electric, gas and now,
water projects. The Enron-Indian Country partnership is built
on mutual respect and admiration for the collective strengths
that each entity brings to create a greater whole than either
entity possesses individually. We recognize that the strengths
of Indian Country lie in its growing market and customer bases,
vast natural and renewable resources, and regulatory and tax
advantages based on Tribal political status as a sovereign
nation. As to Enron's part of the partnership, Enron brings
financing, market risk management and technical and operational
expertise and experience.
As of January 1999, Enron formed its own water company,
Azurix Corporation. Through Azurix, we are now delighted to add
privatized water expertise to our energy portfolio. Azurix is
currently listed on the New York Stock Exchange and is poised
to become a global water company engaged in the business of
acquiring, operating and managing water and wastewater assets,
providing water and wastewater related services, and in
assisting its clients to manage and develop their water related
assets. The capabilities of Enron American Indian Affairs are
especially enhanced with the addition of Azurix to recognize
the significant and timely water issues in Indian Country.
To this end, Enron American Indian Affairs now works in
several additional ways with Tribes: (1) adding water to a
``bundled'' energy picture in exploring energy partnership
opportunities, (2) assessing water opportunities independently
with Tribes, and (3) assisting Tribes to evaluate and manage
their tribal water resources from a total resource development
and management perspective. In all cases, with the addition of
specific water expertise to our intellectual capital base,
Enron's long experience in gas and electricity is readily
transferable to the water arena.
In pursuing energy opportunities with Tribes, Enron's
approach has been fairly simple: We seek Tribal partners that
are equally motivated in seeking ``for-profit'' energy projects
that are culturally, environmentally and economically sound.
The valuation and feasibility process begins with a
comprehensive energy assessment performed by Enron, at Enron's
expense, of a Tribe's resources, physical infrastructure, and
location to markets and general willingness to become
proactively engaged in the energy industry. In exchange for
this assessment, the Tribe contractually agrees to make Enron
its preferred energy partner through mechanisms such as giving
Enron a right of first refusal to pursue projects arising from
the energy assessment. We anticipate that water opportunities
will be explored in a similar manner.
Today, we are currently pursuing assessments with large and
small Tribes, aggregations of more than one Tribe, as well as
entities such as BIA schools. All assessments and transactions
are custom designed for the specific tribal entity or entities.
As noted above, while our previous focus has been on gas and
electricity, we are now including in these assessments any
potential opportunity existing with a Tribe's water resources,
as well as wastewater treatment and water management.
The U.S. water industry is one of the most inefficient
industries in our nation today. As a leader and participant in
developing restructured markets in gas and electricity, Enron
sees many parallels between the status of these energy
industries 15-20 years ago with the water industry today. Just
as Enron led the evolution of natural gas and electric
restructuring, we are excited to take a similar role in the
water industry. In developing energy partnerships with Tribes,
including water project partnerships, Enron and Tribes can
explore together new opportunities and markets based on a more
efficient use of water.
The future of water lies in the efficient use of water in
restructured, open markets. In often complicated water issues,
Enron offers talent and innovative thinking to provide
management skills and new ideas that are unparalleled in the
industry. As we are doing in natural gas and electricity, we
believe Enron and Azurix, in partnership with Tribes, can
together create mutually profitable commercial opportunities
with respect to water resource development and management
resulting in maximized economic potential for each partner.
Mr. Doolittle. Thank you very much.
Mr. Hayes, inasmuch as the Administration, I understand,
does not support Federal funding of a delivery system to bring
the Tiber Reservoir water to the reservation, what do you
believe are the most promising ways available to the tribe to
make use of the Tiber water supply that is provided in the
bill?
Mr. Hayes. Mr. Chairman, we support reasonable efforts to
bring the water to the reservation. We are not saying we don't
support a delivery system. Our view is twofold.
First, in terms of the settlement, we think a contribution
capped at $15 million is an appropriate fund to set aside for a
future delivery system.
Number two, we believe that other options should be
studied. In fact, another aspect of the legislation has the
tribe taking the lead in studying an alternative to the
regional water supply system that has been analyzed.
It is our view that it will in the future be likely
important for the tribe to have access to this water for
drinking water purposes, and we are hopeful that the fund that
is being set aside and that will earn interest will be adequate
to fund whatever future system makes the most sense at that
time, but I don't think any of us are prepared to identify what
that is today.
Mr. Doolittle. Does the Administration have any problem
with our efforts to split the bill into two titles, address the
non-appurtenant question while assuring the tribe rights in the
Tiber Reservoir allocation?
Mr. Hayes. No, Mr. Chairman. We are willing to work with
you and your counsel on that subject.
Mr. Doolittle. What limitations exist on the Administration
to help the tribes get professional or business assistance in
finding ways to better utilize their water rights?
Mr. Hayes. Let me say at the outset that we appreciate your
leadership in bringing the business community into this matter.
We are very supportive of the business community's interest
with this tribe and other tribes.
The only limitation, frankly, is financial. Our entire
budget for negotiating water rights matters nationwide is now
$11 million. We would like to participate as much as possible
in these discussions, but we have some limits in that regard.
To the extent that our financial assistance is not needed,
it is certainly not an issue. We are very supportive of the
concept that you are putting on the table, Mr. Chairman.
Mr. Doolittle. Thank you. Will the administration work with
us to encourage the private sector to assist the tribes in this
endeavor?
Mr. Hayes. We certainly will.
Mr. Doolittle. Thank you very much. You indicate that money
will be appropriated to repair dangerous dams. What programs
are currently available with the department that already
authorize the disbursement of monies for these projects?
Mr. Hayes. We have a safety of dams program, of course, and
safety of dams funds on the Bureau of Indian Affairs side of
the house have been scarce, unfortunately.
Just to clarify the record on this, the primary dam in
question, Bonneau Reservoir, has been stabilized so that it is
not a threat. That is my understanding. The complete securing
of the dam for a permanent basis will be most efficiently done
in connection with the enlargement of the reservoir that will
accompany the implementation of this statute. So we are trying
to address this in an efficient, cost effective, and safe
manner.
Mr. Doolittle. Could you explain how is it that these dams
have been allowed to become dangerous?
Mr. Hayes. It's a budgetary problem, Mr. Chairman. This is
again funded through the BIA, and our request for funds in this
regard have been cut back. What we do is do a ranking of the
most dangerous dams in the country and give top priority,
somewhat like responding to a fire to deal with those
situation.
Anything you could do to help us secure good funding for
the safety of dams program--because it is obviously a matter of
life and death potentially in some situations, and we are doing
the best that we can. We are pleased that this settlement will
help secure these facilities, not on a patchwork basis, but on
a permanent basis, which is the way it should be.
Mr. Doolittle. We will assist you in your efforts. I hope
that Interior will be vigorous in pressing its claim with the
Administration for the necessary monies to do this work and not
let them fall into that condition.
Let me switch to Mr. Tweeten for a minute. In your
testimony you indicate that the State of Montana has worked on
this settlement for almost a decade, and then you state that
``a chill in negotiations has already been felt by western
states due to the reluctance of Congress to ratify this compact
last year.''
Do you think it is unreasonable for the Congress to
thoughtfully consider the first Indian water rights settlement
brought before it in the last decade?
Mr. Tweeten. Mr. Chairman, certainly not. I do think it's
important for Congress to keep in mind as well that states are
watching and tribes are watching as Congress works on this
compact and brings it forward through the ratification process,
and the signal from the Congress to the states that when states
do what we have done with this compact, which is to assiduously
address all of the issues and concerns that are raised on the
local level and to present you with a package that we think is
very well thought out and very well crafted, that Congress is
going to go the next step with us in an expeditious way, I
think would send an important signal to the states and tribes
about the support of the Congress for their efforts in this
area.
Mr. Doolittle. Does the State of Montana have any problem
with our efforts to split the bill into two titles that address
the non-appurtenant question while assuring the tribe rights in
the Tiber Reservoir allocation?
Mr. Tweeten. Mr. Chairman, we have no objection in
principle to the splitting of the bill into two titles. We are
concerned about making sure that the language that is used to
accomplish that maintains the current structure of the compact
so that the water that is allocated to the tribe in Tiber
remains a part of a tribal water right that is subject to all
of the protections for non-Indian users that the tribal right
is subject to under the compact, but in principle we have no
objection.
Mr. Doolittle. I assume you will be working with us as we
make sure the language reflects our common intent to give
effect to these provisions.
Mr. Tweeten. Mr. Chairman, we certainly will.
Mr. Doolittle. Thank you.
Mr. Morsette, does the tribe have any problem on this issue
of splitting the bill into two titles, one of which addresses
the non-appurtenant question while assuring the tribe rights in
the Tiber Reservoir allocation?
Mr. Morsette. No, sir, we don't. What we submitted to Mr.
Faber is what we agreed with, and we would be willing to work
again--What Mr. Tweeten just said. We are willing to work with
the community to work that out if there are any other issues
involved.
Mr. Doolittle. Thank you.
Mr. Fragua, I gather you have had a chance to meet with the
representatives of the Rocky Boy's Tribe.
Mr. Fragua. Yes, we have.
Mr. Doolittle. What ideas or thoughts do you have just from
the opportunity you have had to assess the situation relative
to what they might do to improve upon their situation?
Mr. Fragua. We've had a very brief meeting with the
Chippewa Cree of the Rocky Boy Tribe. Our preliminary
assessment is this. They seem generally interested in our
concept of partnering. We seem generally interested in working
with Indian country in a partnership mode. To that extent, that
is where we are in our discussions.
We are anticipating an opportunity to address the tribal
council at some point, and maybe even after that to have an
opportunity to take a physical assessment and looking at the
opportunities and then render some of that intellectual capital
that we had suggested earlier to be able to bring some creative
solutions. But at this point we have only very briefly met with
the Rocky Boy Tribe.
Mr. Doolittle. I think your involvement in this is a very
positive development and may well be of real assistance to not
only this tribe, but to the extent that we set a pattern for
this kind of cooperation to occur between future tribes and
business in developing their water resources, I think that
would be very positive.
At this point I recognize Mr. Hill for any questions that
he may have.
Mr. Hill. Thank you, Mr. Chairman. Again let me thank all
the members of the panel, all the people who have worked on
this for their patient persistence in helping us get this done
and their willingness to cooperate with our Committee and the
staff.
I would just comment that Congress reserved the authority
to ratify these agreements with the intention that the Congress
would exercise oversight over the agreement. I don't think it
was ever an intention that Congress would just ratify whatever
occurred or rubber stamp, and I think everybody understands
that. Certainly the Chairman has reconfirmed that as we have
gone through this process.
Mr. Tweeten, could you explain to the Committee why the
State of Montana is willing to agree to allow the tribe to
market water allocated to the settlement from sources on the
reservation?
Mr. Tweeten. Thank you, Mr. Chairman, Congressman Hill.
First of all, I think it needs to be understood that it's part
of the public policy of the State of Montana to allow water
users under certain restrictions to lease their water rights.
Non-Indian, non-tribal water rights can be leased under Montana
law. Initially we didn't see any fundamental objection to
extending the same privilege to the tribes that is extended to
water users under state law to lease their water rights. We see
that there are real possibilities for benefits to the state
water users from the ability of the tribe to lease its water.
You need to understand that in this area of Montana the
largest water use by far involves irrigated agriculture. The
Milk River Basin is over-appropriated. It has been closed to
new agricultural appropriations for several years. The
opportunity to lease water from either the Rocky Boy's Tribe or
from the other tribes in the basin that may end up with water
rights that could be leased may in fact be the only opportunity
that exists for additional development of new irrigation water
in the Milk River Basin in the future. So there is a real
tangible benefit to agricultural interests in the Milk River
Basin by allowing this tribe and other tribes to market on the
same basis as other water users.
We have also included in the compact some very significant
protections that guarantee the interests of the State of
Montana in this area. We have limited in the compact and the
tribe has agreed to limit their leasing to the Missouri River
Basin. Water users within the Milk River Basin are allowed a
right of first refusal on any leasing proposal. So they have
the opportunity to keep the water within the Milk River Basin.
The tribe has agreed that any off-reservation marketing
opportunities will be exercised in full compliance with state
law with respect to both water use and the construction of
conveyance structures.
Most importantly, the tribe has agreed that no marketing
opportunity will be undertaken that has any adverse effect on
any existing users under state law. These are very important
protections that the tribe has agreed to, and with those
protections we are very comfortable with the opportunities that
the tribal leasing will offer us in the future for water users
in Montana.
Mr. Hill. It's true that the potential at least exists
under this arrangement for users in areas where we have
insufficient water to be able to take advantage of this compact
beneficially, municipal use, agriculture use, that otherwise
wouldn't have an opportunity, right?
Mr. Tweeten. Mr. Chairman, Congressman Hill, that is right.
Mr. Hill. Also, Mr. Tweeten, do you have any objection to
the tribe developing a business plan for its on-reservation
economic development?
Mr. Tweeten. Congressman Hill, we have no objection to the
development of a business plan. Indeed, it makes sense that the
economic development efforts of any enterprise, whether it be
tribal or non-tribal, be conducted in pursuit of carefully
thought out planning.
We are concerned from a process standpoint with the
creation of an obligation imposed by Federal law that certain
kinds of business planning or certain avenues of business
planning become mandatory in these settlements. We certainly
would hope that if Congress were thinking of imposing such a
requirement that it wouldn't, first of all, do it in the
context of a compact that has already been negotiated so we
would know what the rules are going in and could craft our
compact around that requirement.
Furthermore, we think it's important that if Congress
thinks that those kinds of planning obligations ought to be
imposed that you conduct hearings and take comment from a
broader range of tribes and states than simply Montana and the
Rocky Boy's Chippewa Cree Tribe. I know other tribal entities
and other states certainly have an interest in this question
and I'm sure they would like to make their views known to the
Congress on it as well.
Mr. Hill. If a water compact contemplates a commercial use
of the water, it seems reasonable that Congress might say what
are the potentials of that and why do you want to do that. You
don't object to that.
Mr. Tweeten. No, Congressman Hill, we don't object to that.
Mr. Hill. Mr. Morsette, there is some urgency on the
reservation, isn't there, with regard to getting this resolved?
You have got some health issues with regard to water quality on
the reservation, and obviously there are economic development
needs on the reservation. Would you address those to the
Committee?
Mr. Morsette. Mr. Chairman, Representative Hill, our
population is growing at an astounding rate. We have people
returning to the reservation that don't have anyplace to live.
We have some wastewater treatment facility problems. We have a
population that we can't take care of right now, and we need
extra water; we need economic development; we need jobs; we
need a lot of things on the reservation.
We look at this as a start, the beginning, where we can
start storing some water and using it for agriculture, where we
can start irrigating some of the arable land we have, and going
down the road to sustain ourselves for the future, for the
economic stability of our tribe. This is our beginning, we
hope. We look at this as a big time in our history.
Mr. Hill. Thank you. Again, I want to thank all the
panelists, the Chairman and the staff for our ability to work
through some of the issues that have been raised. I am
optimistic now we are going to be able to move legislation. I
thank you, Mr. Chairman, for allowing me to participate in the
hearing and I again thank all the panelists.
Mr. Doolittle. I thank you. I want to especially
acknowledge Mr. Hill's leading the effort in Congress to bring
this about. I know it has been slower than he had hoped, but I
do think what we have come up with here is a good product that
will stand the test of time and will set a good precedent for
the future.
I again acknowledge the contribution of the tribe, the
State of Montana, and the Federal Government led by Mr. Hayes,
and all the other participants, the stakeholders in this
matter.
There will be further questions no doubt we may wish to
tender to our witnesses. We would ask you to please respond to
them expeditiously, and we will hold the record open for those
responses to come back in. We thank all of you for taking your
time and making the effort to come here today.
With that, this hearing is adjourned.
[Whereupon at 11:59 a.m. the Subcommittee was adjourned.]