[Senate Hearing 108-61]
[From the U.S. Government Publishing Office]



                                                         S. Hrg. 108-61

   TRIBAL ENERGY SELF-SUFFICIENCY ACT AND THE NATIVE AMERICAN ENERGY 
                 DEVELOPMENT AND SELF-DETERMINATION ACT

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON INDIAN AFFAIRS
                          UNITED STATES SENATE

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                                   ON

                                 S. 424

  TO ESTABLISH, REAUTHORIZE, AND IMPROVE ENERGY PROGRAMS RELATING TO 
                             INDIAN TRIBES

                                  AND

                                 S. 522

   TO AMEND THE ENERGY POLICY ACT OF 1992 TO ASSIST INDIAN TRIBES IN 
                      DEVELOPING ENERGY RESOURCES

                               __________

                             MARCH 19, 2003
                             WASHINGTON, DC


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                            WASHINGTON : 2003
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                      COMMITTEE ON INDIAN AFFAIRS

              BEN NIGHTHORSE CAMPBELL, Colorado, Chairman

                DANIEL K. INOUYE, Hawaii, Vice Chairman

JOHN McCAIN, Arizona,                KENT CONRAD, North Dakota
PETE V. DOMENICI, New Mexico         HARRY REID, Nevada
CRAIG THOMAS, Wyoming                DANIEL K. AKAKA, Hawaii
ORRIN G. HATCH, Utah                 BYRON L. DORGAN, North Dakota
JAMES M. INHOFE, Oklahoma            TIM JOHNSON, South Dakota
GORDON SMITH, Oregon                 MARIA CANTWELL, Washington
LISA MURKOWSKI, Alaska

         Paul Moorehead, Majority Staff Director/Chief Counsel

        Patricia M. Zell, Minority Staff Director/Chief Counsel

                                  (ii)


                            C O N T E N T S

                              ----------                              
                                                                   Page
S. 424 and S. 522 text of........................................     2
Statements:
    Bailey, Vicky, assistant secretary for Policy and Intertribal 
      Affairs, Department of Energy, Washington, DC..............    73
    Bingaman, Hon. Jeff, U.S. Senator from New Mexico............    75
    Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado, 
      chairman, Committee on Indian Affairs......................     1
    Gough, Bob, secretary, Intertribal Council on Utility Policy 
      [COUP] Rosebud, SD.........................................    89
    Hill, Vernon, chairman, Eastern Shoshone, Business Council, 
      Fort Washakie, WY..........................................    82
    Inouye, Hon. Daniel K., U.S. Senator from Hawaii, vice 
      chairman, Committee on Indian Affairs......................    70
    Lester, David, executive director, Council for Energy 
      Resource Tribes [CERT], Denver, CO.........................    87
    Maynes, Frank E., tribal attorney, on behalf of, the Southern 
      Ute Indian tribal chairman, Howard D. Richards, Sr., 
      Durango, CO................................................    84
    Rosier, Theresa, counselor to the Assistant Secretary for 
      Indian Affairs, Department of the Interior, Washington, DC.    70
    Roubidoux, Victor, board member, Council of Energy Resource 
      Tribes.....................................................    89
    Thomas, Hon. Craig Thomas, U.S. Senator from Wyoming.........    76
    Trujillo, Arvin, Director, Navajo Natural Resources..........    80

                                Appendix

Prepared statements:
    Adamson, Rebecca L...........................................   139
    Affiliated Tribes of Northwest Indians (with attachments)....   141
    Bailey, Vicky................................................    95
    Buccino, Sharon, senior attorney, Natural Resources Defense 
      Council....................................................   150
    Gough, Bob (with attachments)................................   130
    Hill, Vernon.................................................   114
    Lester, David................................................   124
    Richards, Sr., Howard D., chairman, Southern Ute Indian 
      Tribal Council (with attachments)..........................   153
    Rosier, Theresa..............................................    93
    Roubidoux, Victor............................................   127
    Shimek, Robert...............................................   170
    Thomas, Hon. Craig, U.S. Senator from Wyoming................    93
    Shirley, Joe, president, Navajo Nation (with attachments)....    98
Additional material submitted for the record:
    Richardson, Bill, Governor, New Mexico (letter)..............   171

 
 INDIAN ENERGY LEGISLATION, S. 434, THE TRIBAL ENERGY SELF-SUFFICIENCY 
   ACT, AND S. 522, THE NATIVE AMERICAN ENERGY DEVELOPMENT AND SELF-
                       DETERMINATION ACT OF 2003

                              ----------                              


                       WEDNESDAY, MARCH 19, 2003


                                       U.S. Senate,
                               Committee on Indian Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:30 p.m. in room 
485, Senate Russell Building, Hon. Ben Nighthorse Campbell, 
(chairman of the committee) presiding.
    Present: Senators Campbell, Inouye, and Thomas.

 STATEMENT OF HON. BEN NIGHTHORSE CAMPBELL, U.S. SENATOR FROM 
        COLORADO, CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

    The Chairman. The Committee on Indian Affairs will be in 
session.
    Good afternoon, and welcome to the committee's hearing on 
two Indian energy bills, S. 424 introduced on February 14 by 
Senator Bingaman, and S. 522, which I introduced on March 5. 
Within hours, our Nation will be embroiled in apparently a 
major ground war in the Middle East and in recent weeks, world 
oil prices have soared to $40 per barrel. I think America has 
to kick the habit on depending on foreign energy and start 
producing more of its own energy. One answer to our energy 
future is in the domestic production, and I just don't mean in 
ANWR either. That is going to be subject to a vote at 3 
o'clock, by the way.
    Indian-owned energy resources are still largely 
undeveloped--1.81 million acres are being explored or in 
production, but about 15 million more acres of energy resources 
are undeveloped. I believe the chart out front here shows a 
little bit more of what I am trying to describe.
    There are 90 tribes that own significant energy resources, 
both renewable and nonrenewable. Many of them want to develop 
those resources. Today we will hear from the Bush 
administration and tribal witnesses. I certainly welcome all 
committee members.
    [Text of S. 424 and S. 522 follow:]



    The Chairman. I will put my full statement in the record 
because we do have a vote at 3 o'clock. What we will probably 
have to do is try to get through the first panel, take a break 
and then come back for the second panel.
    With that, I would like to turn to our Vice Chairman, 
Senator Inouye.

 STATEMENT OF HON. DANIEL K. INOUYE, U.S. SENATOR FROM HAWAII, 
           VICE CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

    Senator Inouye. Thank you very much, Mr. Chairman, for 
scheduling this hearing, because these initiatives are very 
important and intended to provide support to tribal governments 
in the development of energy resources on Indian lands, and to 
provide incentives for partnership with tribes that want to 
develop their resources. With the vast untapped resources on 
tribal lands throughout the United States, it is clear that 
Indian country has an important contribution to make to our 
Nation's energy reserves.
    I am pleased that our colleague from New Mexico, and the 
author of one of the measures we consider today, Senator 
Bingaman, will be with us a little later in the hearing to 
address this bill. I thank you very much, Mr. Chairman.
    The Chairman. Thank you. Senator Bingaman might wait until 
after the vote to be here to introduce his bill.
    We will go ahead and start with Panel I. Theresa Rosier, 
counselor to the Assistant Secretary for Indian Affairs, 
Department of the Interior, and Vicky Bailey, Assistant 
Secretary for Policy and International Affairs, Department of 
Energy, please come forward.
    Theresa, if you would like to start, go ahead.

    STATEMENT OF THERESA ROSIER, COUNSELOR TO THE ASSISTANT 
   SECRETARY FOR INDIAN AFFAIRS, DEPARTMENT OF THE INTERIOR, 
                         WASHINGTON, DC

    Ms. Rosier. Good afternoon, Mr. Chairman, Vice Chairman, 
and members of the committee. My name is Theresa Rosier, and I 
am counselor to the Assistant Secretary for Indian Affairs.
    I am pleased today to present the Department of the 
Interior's views on S. 522, the Native American Energy 
Development and Self-Determination Act of 2003, and S. 424, the 
Tribal Energy Self-Sufficiency Act.
    I will abbreviate my testimony and submit my complete 
written testimony for the record.
    The Chairman. Without objection, that will be fine.
    [Prepared statement of Ms. Rosier appears in appendix.]
    Ms. Rosier. The Bureau of Indian Affairs manages 
approximately 56 million acres of land in trust for individual 
Indians and Indian tribes. Currently there are 1.81 million 
acres of actively leased oil, gas, and coal in various phases 
of exploration and development. In fact, production of energy 
minerals from Indian tribes continues to represent over 10 
percent of the total Federal onshore production.
    Moreover, production from Indian lands in the year 2001 was 
13.1 billion barrels of oil, 280 billion cubic feet of gas, and 
29.4 million short tons of coal. It is estimated that an 
additional 15 million acres of undeveloped energy resources 
exists on individual and tribal land. The potential for further 
energy development in Indian country is exciting.
    Increased energy development in Indian country means 
increased jobs. In many Indian and Alaska Native communities, 
joblessness and underemployment are painfully acute. More than 
ever, tribes need the job and training opportunities that go 
hand-in-hand with expanded mineral and energy development.
    One of the tragic ironies of life in Indian communities is 
that tribes often possess substantial energy resources but yet 
they often pay very high, or the highest electrical costs, and 
sometimes lack complete access to electricity. As the Navajo 
tribe will testify to later today, over 37 percent of their 
tribe does not have access to electricity.
    Consistent with the President's National Energy Policy to 
secure America's energy future, increased energy development in 
Indian and Alaska native communities will help the Nation 
increase its domestic energy resources. S. 522 promotes 
increased and efficient energy development and production in an 
environmentally sound manner.
    While the administration supports the goals and objectives 
of S. 522, which are the promotion of self-determination and 
economic development, there are there several provisions which 
we want to work with the committee on before this bill moves 
forward.
    Because this legislation has programs that affect both the 
Department of the Interior, the Department of Energy, and the 
Department of Housing and Urban Development, my testimony today 
will only focus on the Department of the Interior and how the 
bill relates to them.
    S. 522 bills upon the self-determination principles of the 
Indian Mineral Development Act of 1982. It focuses on tribal 
control and tribal flexibility for the exploration, extraction, 
processing, and development of fossil and renewable resources. 
S. 522 would authorize individual Indians and tribal 
governments to enter into energy development leases or business 
agreements without Federal review, as long as two certain 
preconditions have been met.
    One, that the Secretary has already approved the tribal 
regulations which govern these leases and business agreements, 
and two, that these leases and business agreements do not 
exceed 30 years.
    Moreover, this bill authorizes tribes to grant rights-of-
way over tribal land for electrical, pipeline, and distribution 
lines. There must be three conditions before these rights-of-
way could be granted.
    First, that the Secretary has approved the regulations 
which govern the rights-of-way; second, that the rights-of-way 
does not exceed 30 years, and third, that the pipeline, 
transmission, or distribution lines serve either a facility 
located on Indian land or energy that was produced on Indian 
land. The Department supports increased tribal regulation and 
expedited review of these regulatory processes.
    As drafted, however, it is unclear whether this section 
would apply to the Department of the Interior or the Department 
of Energy. The Department believes that it is most appropriate 
for the Secretary of the Interior to approve tribal regulations 
which govern the leasing of trust or restricted land, 
conveyances of rights-of-way, and business agreements because 
documentations necessary to prove such tribal regulations 
involve trust records and trust payments and are under the 
purview of the Department of the Interior.
    Generally the Department is supportive of the creation of 
the Indian Energy Resource Commission. We look to the 
Commission to recommend ways to facilitate economic development 
and Indian and Alaska Native communities. Hopefully this will 
mean that there will be more tribal joint ventures, greater 
tribal participation in the building of transmission and 
distribution lines, and increased tribal ownership of power 
plant and utility companies.
    The Department, however, is opposed to the power of the 
Commission to subpoena testimony and records. This Commission 
should not be an investigatory body. Instead, we look to this 
Commission to look to future goals for Indian economic 
development. As we understand it, the General Accounting Office 
does not have the authority to subpoena records from Federal 
Government agencies.
    Now I will discuss S. 424, the Tribal Energy Self-
Sufficiency Act. Both renewable and nonrenewable energy is 
uniquely positioned to play a critical role as the Nation 
starts to look at domestic energy supplies. In addition to 
traditional energy resources, alternative and renewable 
energies play a critical part in the President's energy policy.
    My testimony today will focus on the provisions of S. 424 
which deal directly with the Department of the Interior. S. 424 
would also increase tribal self-determination. It would 
authorize Indian tribes to lease land for electrical 
generation, transmission, or distribution, and for facilities 
to refine renewable and non-renewable energy sources. There are 
two preconditions that must be met here.
    First, that the lease was approved by regulations which the 
Secretary of the Interior approved and, second, that the lease 
did not exceed 30 years. Moreover, tribes are also authorized 
to grant a right-of-way over tribal lands without the Secretary 
of the Interior approval if the rights-of-way was executed with 
regulations pre-approved by the Secretary, the rights-of-way 
does not exceed 30 years, and that the transmission or 
distribution facilities serve as a facility on Indian lands, or 
that the energy was produced on Indian lands.
    Also, S. 424 authorizes the approval of energy business 
agreements without Secretarial review if a comprehensive 
environmental review process has already been completed. These 
provisions promote increased tribal self-determination as 
tribes administer and regulate their own tribal energy policy.
    Moreover, efficient locally-controlled regulatory 
structures and Indian communities create a business-friendly 
environment that promotes exciting partnerships between the 
tribes, the private sector, and the Federal Government.
    Second, the bill also requires review of the Indian Mineral 
Development Act. It has been over 20 years since IMDA was 
enacted. The Department is already working with tribes to 
review IMDA and to improve energy development in Indian 
country.
    For example, in November or December 2001, the Department 
held an Indian Energy Summit. From this Summit, we have had six 
scoping meetings around the country this past year from April 
2002 until December 2002. The Department talked with tribes and 
started pre-consultations an a National Indian Energy Policy. 
What the Department is looking to do next is to establish 
formal consultations with the tribes to work on an National 
Indian Energy Policy.
    Thank you for the opportunity to testify before you. I 
welcome any questions.
    The Chairman. Thank you.
    Ms. Bailey.

 STATEMENT OF VICKY BAILEY, ASSISTANT SECRETARY FOR POLICY AND 
  INTERNATIONAL AFFAIRS, DEPARTMENT OF ENERGY, WASHINGTON, DC

    Ms. Bailey. Thank you, Mr. Chairman, Mr. Vice Chairman, and 
members of the committee. I, too, am pleased to be here to 
discuss proposed legislation, S. 424, and S. 522, regarding the 
Indian Energy Policy and to provide you information on the 
Department's current structure and ongoing programs.
    Our activities reflect Secretary Abraham's affirmation of 
the Department's commitment to meet its responsibilities to 
Indian country in a manner consistent with the government-to-
government relationship that exists between federally-
recognized tribes and the Department.
    Before I begin my formal testimony, I would like to commend 
you, Mr. Chairman, and the entire committee on your leadership 
in addressing the challenging issues before us. We all know 
that the United States is better served when the Federal 
Government and Indian tribes work together to meet common 
objectives.
    From an energy perspective, Native American reservations 
contain large reserves of oil and gas. There are an estimated 
890 million barrels of oil and natural gas liquids, and 5.5 
trillion cubic feet of gas on tribal lands. This translates 
into huge potential revenues for the tribes even when 
conservative production estimates are used.
    Indian energy resource development and energy policy, in 
general, are areas where the Department and the Indian tribes 
share many mutual interests and can together influence 
America's future in a constructive manner.
    As Secretary Abraham has stated, the Administration wants 
to work with Congress on provisions that facilitate energy 
development on tribal lands while enhancing and protecting the 
environment.
    The Administration's commitment to a comprehensive and 
balanced national energy policy is in the best interest of all 
Americans. That is why the President announced his National 
Energy Policy in May 2001, less than 4 months after he took 
office. We face many energy challenges that require attention 
now. Enacting an effective National Energy Policy during the 
108th Congress is one of the President's top priorities. We are 
pleased that both houses of Congress are moving forward.
    As you know, today a key House subcommittee is marking up 
comprehensive energy legislation. The short and long-term 
energy supply and demand issues are before us, in addition to 
posing challenges, providing an opportunity for us to improve 
our environment and our economy, while enhancing our energy 
future.
    Americans share many common concerns regarding that energy 
future. Those shared concerns may not offer one-size-fits-all 
solutions. Some issues will require different approaches that 
recognize the unique dynamics at play due to any number of 
factors and circumstances. Certainly there are issues unique to 
Indian country, and we must have the tools to address them 
within our National Energy Policy framework.
    I would like to provide an overview of the Department's 
energy structure in order to provide a reference point for the 
proposed legislation in implementing Secretary Abraham's 
written direction to department heads requesting that they 
honor the government-to-government relationship that exists 
between the Federal Government and federally-recognized Indian 
tribes. Tribal points of contact have been established. These 
50 points of contact focus on relations with Native American 
tribes and Alaska Natives.
    In addition, within DOE's Office of Congressional and 
Intergovernmental Affairs, a Director of Indian Affairs serves 
as the Department's primary point-of-contact on Native American 
issues. A recent vacancy in that position should be filled in 
the very near future, but the work of that office and that 
director continues to be performed through our Office of 
Intergovernmental and External Affairs.
    To give some examples of DOE's tribal activity within 
selected programs at DOE sites, DOE and our power marketing 
administrations are committed to continuing our work with 
tribal governments on the many issues in which we have a common 
interest.
    Mr. Chairman, in the interest of time I will not list those 
representative activities in my oral statement. They are 
included in my formal testimony, and include programs and 
projects within the following three DOE offices: The Office of 
Economic Impact and Diversity, the Office of Energy Efficiency 
and Renewable Energy, and Western Area Power Administration, 
commonly known as WAPA.
    Regarding the legislation pending before the committee, the 
Department is reviewing the provisions of S. 424 and S. 522. 
These two bills are comprehensive and we support the goal of 
maximizing environmentally sound resource development on tribal 
lands. We will continue to study the specific provisions of the 
legislation and look forward to working with you toward 
achievement of our mutual objectives.
    This concludes my oral statement, Mr. Chairman. I hope that 
my testimony provides you and the other members of the 
committee with a good understanding of the importance this 
Administration attaches to our work with American Indian tribes 
and Alaska Natives in the context of the President's National 
Energy Policy.
    I will be pleased to respond to any questions you may have 
and ask that my written testimony be placed in the record in 
its entirety.
    [Prepared statement of Ms. Bailey appears in appendix.]
    The Chairman. Thank you.
    Just listening to the both of you, I have to tell you, it 
sounds like the Energy Department is going to be a lot more 
supportive of Indian programs that the Interior Department. One 
of the big problems that we hear from tribes is that Interior 
either doesn't approve the documents that the tribes need or 
the Department scuttles the deal, or the Department was so slow 
in doing it that the tribes or its business partner loses 
interest.
    After hearing your comments, Ms. Rosier, I think I should 
have kept you on staff here and not let you go over there to 
Interior. [Laughter.]
    I'll pass on that for 1 minute and ask you some questions.
    Senator Bingaman, did you want to talk about your bill for 
a moment?

 STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR FROM NEW MEXICO

    Senator Bingaman. Thank you very much, Mr. Chairman, for 
inviting me here. I do appreciate the chance to say a few words 
about S. 424, that I introduced with your support, Senator 
Inouye's support, and Senator Daschle's support as well.
    This essentially is the title that we included in the 
comprehensive energy bill that we passed through the Senate 
last year. We put a title in there related to development of 
energy resources on Indian lands. We have taken those 
provisions and included them here.
    We think they are important that as we develop this 
comprehensive energy policy in ensuring that there be 
sufficient emphasis on the opportunity that we have, not only 
to develop resources that are on Indian American lands, but 
also to be sure that the benefits of those resources accrue to 
the Indian community.
    We have a terrible problem in my State and in various 
States around the country. Although some of our reservations 
are rich in energy resources, we have many people living on 
those reservations who, for example, have no electricity. We 
need to help both in the development of the resources and help 
to ensure that the benefits of that development inures to the 
actual tribal members.
    That is one of the things we are trying to do in S. 424. We 
do call for setting up in that legislation an Office of Indian 
Energy Policy and Programs within the Department of Energy. We 
expand DOE's authority to assist tribes to help ensure that the 
Federal Government, as a whole, is working with tribes in a way 
that is consistent with the Federal Trust responsibility.
    We do have additional help there. There are provisions in 
the bill intended to help facilitate the citing of certain 
energy projects on Indian land consistent with the sovereign 
authority of the tribes. We have a lot of other provisions.
    There is one area that has become a little controversial 
that I will just call to the attention of the committee so you 
can perhaps address it before you pass on this legislation. 
There are concerns with language in the bill that limits the 
liability of the Federal Government with respect to leases and 
rights-of-way approved by tribes under the citing provisions of 
the bill.
    We are glad to work with you, Mr. Chairman, to be sure that 
those concerns are addressed. We think there is a way to do 
that. I encourage the committee to look closely at that issue 
before you finally pass on the bill. That is something that 
should be corrected at the committee and there is no reason 
that we cannot do that.
     I think that sums up the points I had to make on the 
legislation. I look forward to working with you not only on 
this bill but on your companion bill, S. 522. I hope that your 
committee here can move ahead and we can move ahead in the 
Energy Committee as well and see to it that it gets to the 
President's desk.
    The Chairman. Thank you.
    Senator Thomas, as a cosponsor of S. 522 do you have any 
comments on either bill?

   STATEM,ENT OF HON. CRAIG THOMAS, U.S. SENATOR FROM WYOMING

    Senator Thomas. Thank you, Mr. Chairman. I am sorry that I 
was not able to be here earlier. I do thank you for having this 
hearing. I particularly wanted to be here because Chairman 
Vernon Hill from the Eastern Shoshone Business Council is here. 
I want to welcome him.
    I am on the Energy Committee, as you are, and certainly as 
we develop a comprehensive energy bill, the resources should 
not be overlooked in the Indian lands. I think it is something 
we really ought to do in Wyoming where we have large 
reservations--over 2 million acres. The opportunity is there 
for both our tribes to get some economic benefit, as well as 
benefit to the whole country.
    I was a cosponsor of your bill, Senator Campbell, and 
certainly support what you were seeking to do there. Quite a 
few of members of this Committee are also on the Energy 
Committee. We ought to be able to put something together and do 
it very soon. I look forward to working with all of you.
    I would ask that my full statement be inserted in the 
record.
    [prepared statement of Senator Thomas appears in appendix.]
    The Chairman. Thank you. Maybe before we are called to 
vote, we can ask a few questions.
    Theresa, ever since the Nixon days there has been a clear 
trend in Indian country and Indian policy favoring tribes and 
letting them exercise more authority themselves and more 
control over their own programs. But as I hear your statement, 
it sounds to me that Interior is very concerned over their own 
ability to keep control over what the tribe does with their 
energy.
    Can you tell me if the Department is really interested in 
making sure that the Indians move forward with their own 
extraction process and exploration and the things I think they 
ought to be able to do?
    Ms. Rosier. Absolutely. The Department of the Interior 
strongly supports your bill, S. 522. We are supportive of 
having tribes have more self-determination and have more 
responsibility in the development of renewable and nonrenewable 
energies on their lands. We are strongly supportive of that 
provision.
    We would like to comment and work with you just to refine 
the language, but we are supportive of improvement self-
determination.
    The Chairman. Do you have any specific examples of how we 
can encourage the Department to provide scientific geologic and 
technical expertise, but at the same time being able to allow 
the tribes to have more latitude?
    Ms. Rosier. In this year's fiscal year 2004 budget, 
President Bush asked for a $2-million increase in the grants 
program that our Division of Energy and Mineral Resources runs. 
What these grant programs do is they award to tribes grants 
which the tribes use to explore their energy potential--
generally it's mineral. That is part of our budget request. But 
the Department wants to support tribes to explore their energy 
resources and renewable and nonrenewable resources.
    The Chairman. The Indian Energy Commission would look at 
ways to remedy issues like dual taxation. If we retain that 
Commission, what commitments are there that the Department 
would seek funding for it and make it a priority?
    Ms. Rosier. If this bill is enacted, the Department would 
work with this Committee to support and help fund this 
Commission.
    The Chairman. Okay. Good.
    Ms. Bailey, we didn't get your comments until about 2\1/2\ 
hours ago. Neither the staff nor I had time to read them so I 
don't have any specific questions. I think you missed an 
opportunity to be able to answer some of those. What we are 
going to do is to put them in writing to you. If you could give 
those answers back for the full committee, I would appreciate 
it.
    Ms. Bailey. Most certainly. I would be pleased to do so.
    The Chairman. Senator Inouye.
    Senator Inouye. Thank you.
    In both bills, the tribes have the authority to execute and 
approve their own leases, rights-of-way and agreements with 
others. If they adopt their own environmental regulations, the 
National Environmental Policy Act review does not apply; is 
that correct?
    Ms. Rosier. NEPA would apply when the Secretary is 
approving the initial regulations. Whether it is a general NEPA 
review or specific NEPA review depends on what the regulations 
say. But you are right. After the initial approval of the 
Secretary, whatever is in the purview of that plan, NEPA would 
not apply.
    Senator Inouye. However, when that happens, in both bills 
the Government of the United States will disclaim all 
liability; is that correct?
    Ms. Rosier. In both bills the language does say that any 
business agreement or lease that is conveyed under these tribal 
regulations, that the Government would not have liability for 
damages; yes.
    Senator Inouye. In your opinion, or the opinion of your 
Department, would these provisions have any impact upon what we 
call the trust relationship between Indian country and the 
Government of the United States?
    Ms. Rosier. The Government would have a trust 
responsibility and the Secretary would approve these leases and 
rights-of-way in the initial review of the tribal regulations. 
After that, it would follow the recent Supreme Court Case, 
United States v. Navajo. There is a limited trust 
responsibility as defined by the language in the bills.
    Senator Inouye. It would permit the Government of the 
United States to wash its hands and say, ``It's none of our 
business;'' is that correct?
    Ms. Rosier. In the vein of tribal self-determination as the 
Supreme Court ruled in Navajo, if there is not a specific duty 
of management or obligation, then the Government is not liable 
for damages.
    Senator Inouye. Is that desirable to the Government of the 
United States?
    Ms. Rosier. The Government supports the language in these 
bills. The Department of the Interior supports the language in 
these bills.
    Senator Inouye. What is the position of the Department of 
Energy? You mentioned the government-to-government 
relationship.
    Ms. Bailey. Very committed to government-to-government 
relationships. We have various projects going on at different 
sites. They are very site specific. But our analysis as it 
relates to S. 424 and S. 522 and some of the provisions you are 
speaking to, we really haven't had the opportunity to get an 
opinion. We are continuing to look at that and trying to come 
together on what our thoughts and responses are. But we haven't 
had an opportunity to get a Department opinion as yet.
    Senator Inouye. As both of you are aware, many years ago 
private enterprise began constructing hydroelectric dams in 
Indian Country and have been operating them for about 50 years. 
They have 50-year leases. They are coming up for re-licensing. 
They impact upon tribal lands and on tribal cultural resources.
    If the tribes are going to participate in their re-
licensing, I have been told that the cost may be prohibitive. 
Is the Government of the United States and the Department of 
the Interior available to assist and participate in these 
proceedings, such as providing funding to the tribes to 
participate in the Federal Energy Regulatory Commission [FERC] 
re-licensing process?
    Ms. Rosier. Off the top of my head, I don't know our 
numbers for the FERC program this year and what or budget 
numbers are. We do work with the tribes rather closely when 
issuing mandatory conditions. I can follow up in a written 
answer to you.
    Senator Inouye. I am not an expert. I ask this question 
because I have been told that many of these licenses were 
acquired at a time when Indian country was at a disadvantage. 
The Indians were told, ``You take it or else. You like it or 
don't like it. It makes no difference to us.''
    Now if they wish to play a significant role in the 
management of these dams, it is going to cost a whole lot of 
money which they do not have. Would you check to see if 
Interior is ready to help the Indians?
    Ms. Rosier. I will.
    Senator Inouye. Mr. Chairman, I have several more 
questions, but if I may, I would like to submit them.
    The Chairman. Without objection.
    Let me ask just one follow-up question since Senator Inouye 
has touched this subject about managerial control and 
liability.
    If the tribe has managerial control over its resources and 
it makes the decisions, shouldn't the tribe and not the United 
States retain the liability over those decisions, too?
    Ms. Rosier. Yes; the Department of the Interior would. It 
is similar to the language of these bills. We would support 
those tenents.
    The Chairman. Okay.
    Senator Thomas, did you have some questions?
    Senator Thomas. Just one, and it is pretty basic. As we 
look at ways to change things, to make them work better, what 
would you say have been the major obstacles as to why there 
hasn't been more energy development on the tribal lands?
    Ms. Bailey. I will try that first. I think DOE's 
involvement has been ongoing. I think there have been many 
ongoing activities. As I have had a chance to prepare my 
testimony and look at our different offices and the projects in 
which they are involved, there have been a lot of technology-
related and probably environmental-related work with the 
tribes.
    But as it relates to energy, probably the one I know the 
best is probably the hydroelectric from the standpoint of being 
a former Commissioner at FERC and from the issue of re-
licensing of dams and working with the tribes in that respect. 
I know that FERC is trying to streamline that process. They 
recently issued a proposed rule that would make some 
administrative changes. I believe Congress is also considering 
legislative reforms.
    But probably a lot of it has to do with coming up with a 
comprehensive plan and obviously funding, making sure that the 
resources are there as well.
    Senator Thomas. You know, the developers provide the money 
in energy development. Why can't that be the case here?
    Ms. Bailey. I'm not saying that it probably couldn't be. I 
have very limited expertise.
    Senator Thomas. It is a puzzle to me. There are obviously 
opportunities on the tribal lands. Yet years have gone by and 
not much has happened. As you prepare to fix it, you have to 
define what you think the major obstacles have been.
    Ms. Rosier. For the Department of the Interior, one of 
obstacles, as you all aware of being on this committee, is that 
we are very slow and we are very bureaucratic. I think we have 
a cumbersome and time consuming process. S. 522 would expedite 
the regulatory process.
    Senator Thomas. Thank you.
    The Chairman. Okay. We appreciate your being here. There 
may be further questions from other people on the committee 
that might be submitted in writing to you both. If you could 
get those back to us, we would appreciate it. Thank you.
    We will now proceed with the second panel as far as we can 
go until we are called to vote.
    Our second panel will be: Joe Shirley, Jr., president of 
the Navajo Nation; Vernon Hill, chairman of the Eastern 
Shoshone Business Council; and Robert Santistevan, director, 
Southern Ute Growth Fund from Ignacio, CO, my home town.
    Your complete written testimony will be included in the 
record if you want to divert from that.
    We will start in that order with Mr. Shirley.

    STATEMENT OF ARVIN TRUJILLO, DIRECTOR OF NAVAJO NATURAL 
                           RESOURCES

    Mr. Trujillo. Thank you, Mr. Chairman, and members of the 
Senate Indian Affairs Committee. My name is Arvin Trujillo. I 
am the executive director for the Division of Natural 
Resources. I am here representing President Joe Shirley from 
the Navajo Nation. I would like to extend my greetings to the 
chairman and members of the committee from the president and 
vice president of the Navajo Nation.
    Again, I want to thank the committee for the opportunity to 
make the presentation before the committee as well as the work 
that has been done on S. 424 and S. 522. As noted, we have 
submitted our testimony.
    [Prepared statement of Mr. Shirley appears in appendix.]
    Mr. Trujillo. What I want to basically focus on, Mr. 
Chairman, is the purpose of our meeting here today. The Navajo 
Nation has long been involved in energy development. Since 
1921, the Nation has been involved in the development of its 
resources, starting with oil. In the 1940's and 1950's, we 
extended that toward the development of uranium. In the 1950's 
and 1970's, we again further our developed our oil. In the 
1960's and 1970's we expanded that into coal.
    There are a number of stakeholders involved in the work 
that we do in terms of the development of our energy. The 
written testimony begins to look at three basic factors that we 
are beginning to focus on. No. 1, who benefits from this 
number? No. 2, who controls the effort? No. 3, who is 
accountable?
    Again, there are a number of stakeholders involved. The 
Navajo Nation itself, the size of the nation, and the fact that 
yes, we do have a number of different resources--and I named a 
few. In essence, we also are very much involved in lighting up 
the southwestern portion of the United States as well as 
Southern California. There are tribal members involved. We are 
beginning to see the impacts on the communities as resources 
are developed.
    We are also looking at the tribal membership in terms of 
the government as a whole. There are investors involved--the 
private sector--and how we begin to interact with those 
investors. The Federal Government itself is involved because of 
the agencies that are included. That has been noted in the 
bills that have been developed.
    I guess the bottomline is basically looking at the 
stakeholders. They are seeking a safe and stable environment in 
which to live and to do business. For the Navajo people, this 
simply means clean air, water, the ability to continue 
traditional practices, and the opportunity to improve their 
quality of life.
    For the private sector this is looking at clear rules of 
finality to help them in their business aspects so that they 
can better define how to develop their business practices. For 
the Navajo Government, it means clearly to define a regulatory 
landscape or environment. For the taxpayers themselves, this 
means the advancement of the general welfare in the investment 
in tribes and to get a return--in this case--of energy.
    With that in mind, there is a new paradigm, Mr. Chairman 
and members of the committee, that is beginning to develop. 
That is what the Navajo Nation has been focused on for these 
past 2 years. The paradigm has switched for us as of March 4 of 
this year.
    The goal is to create a return on the public investment to 
advance tribal self-determination and self-sufficiency and to 
wean American off foreign oil. Then the Navajo Nation is a 
major player who has the experience to form a basis of comment 
because of our experience, because of our location, and because 
of our size.
    We are beginning to learn new aspects on how we can begin 
to develop our natural resources not only for the benefit of 
our people and our own government, but also for the benefit of 
the regional area, as well as the southwestern portion of the 
United States.
    Why I come before this committee and to you, Mr. Chairman, 
is to look at some basic principles, fundamental principles, 
that tribes are different. We can't fit all tribes in one box. 
There is a continuum that we have to begin to address. There 
needs to be a sliding scale. That sliding scale must recognize 
a tribe's ability to be self-determinant in certain areas.
    How much control does the government have with the tribe? 
How effective and how efficient are we as tribes in developing 
our own energy, looking at our own regulatory aspects, and in 
addressing our own environmental concerns? That sliding scale 
changes as you look at the different types of development 
within Indian country.
    The second piece is looking at the recent decision by the 
Supreme Court and begin to address trust responsibilities and 
how to define this in terms that support self-determination. In 
the opinion of the Supreme Court there is one statement in 
there that states: ``The ideal of Indian self-determination is 
directly at odds with Secretarial control.''
    We are beginning to see a new philosophy beginning to 
emerge. The honorable Senator from Hawaii has touched on the 
issue of liability. Again, we are looking on how does that 
liability touch our abilities to enhance our efforts to advance 
energy development within our own tribes.
    With that new paradigm the Nation begins to again focus on 
the Supreme Court hearing on March 4, the decision that came 
down. That has changed. The members of your staff have been 
given copies of this.
    The Navajo Nation is moving forward with an effort toward 
developing an energy policy for itself. We have done a 
tremendous amount of research into the area. It has changed a 
lot of our ideas and assumptions. Our Navajo Nation Council at 
this point is beginning to address this new paradigm. How do we 
begin to look at energy development? We have not looked at it 
from a pragmatic point of view, but bringing it all together.
    The Navajo Nation is reanalyzing things that were develop 
as recently as last year. We support the efforts of the 
Senators--both yourself, Mr. Chairman, and Senator Bingaman. We 
support the efforts that were developed in S. 424 and S. 522. 
But we have to reanalyze those bills in view of the decision 
that was given down with the Supreme Court.
    In closing, Senator Craig Thomas asked about development. I 
used the analogy of the triangle, saying that you have to have 
three pieces if you are going to develop anywhere. You have to 
have land. You have to have water. And you have to have power. 
If you miss any of those aspects, development will not happen.
    The way I explain it to my own constituents at the Chapter 
House is that it is like fire. You have to have heat. You have 
to have a fuel source. You have to have an ignition point, or 
oxygen. If you take any one of those pieces out, you won't have 
fire. That is where we stand at this point.
    Respectfully, members of the committee, that is what we are 
working on at this point from the Navajo Nation. We would like 
to request that we submit further detailed testimony relevant 
to each of the bills in lieu of the decision that has been 
said. The president of the Navajo Nation, as well as the 
council, are looking very closely at these issues. We would 
like to bring back a position of the nation that is consistent 
with the decisions that have been made and with some of the new 
directions that we are beginning we move as the Navajo Nation.
    Thank you, Mr. Chairman.
    The Chairman. That is our second bell to vote. With that, 
we are going to take a 15-minute recess.
    [Recess.]
    The Chairman. The committee will come to order.
    Senator Inouye has been detained and won't be back. We will 
go ahead and continue with Vernon Hill.

 STATEMENT OF VERNON HILL, CHAIRMAN, EASTERN SHOSHONE BUSINESS 
                   COUNCIL, FORT WASHAKIE, WY

    Mr. Hill. Good afternoon, Mr. Chairman, and members of the 
committee. My name is Vernon Hill. I am the chairman of the 
Eastern Shoshone Business Council in Wyoming. I would like to 
thank you for the invitation to be here.
    My remarks and written statement are submitted on behalf of 
both the Eastern Shoshone Tribe and the Northern Arapaho Tribe. 
I would request that they be submitted into the record.
    The Chairman. Without objection, it will be in the record.
    [Prepared statement of Mr. Hill appears in appendix.]
    Mr. Hill. We generate nearly $180 million annually in 
economic activity, primarily from oil and gas production. We 
provide 1,600 jobs, revenue from our oil and gas operations; 85 
percent of the royalty income is paid out to tribal members. 
This provides food, heat, electricity, and other basic needs. 
For some tribal members, this is their only income.
    We have 850 producing wells. Our oil production totals over 
20 percent of all royalties paid from Indian reservations in 
the lower 48 States. Our natural gas totals nearly 10 percent 
of royalties paid based on known data. We have significantly 
more untapped reserves.
    An ongoing obstacle is the State of Wyoming's 14 percent 
taxation on the production. These taxes on top of the tribe's 8 
percent creates a severe tax burden of 22 percent and is 
primarily a disincentive for additional development. Therefore, 
we strongly urge Congress to address the double taxation 
problem.
    In the 107th Congress we supported S. 1106 introduced by 
Senator Domenici to establish a Federal tax credit based on the 
volume of production of oil and gas from Indian lands. This 
type of credit would stimulate tribal economies and increase 
the overall domestic oil and gas supplies, thereby reducing our 
country's dependence on foreign sources of energy.
    We believe that any comprehensive energy legislation must 
include meaningful tax incentives to encourage, promote, and 
foster energy production on Indian lands. In addition, both our 
tribes own fee lands and have energy potential. Therefore, we 
believe these bills should provide some preference or direction 
to the Secretary of the Interior in processing and approving 
fee to trust applications for energy development purposes.
    With respect to the provisions of S. 424 and S. 522, we 
offer the following comments. We support creating a 
comprehensive Indian Energy and Policy Program in the 
Department of Energy. This program, with appropriate funding, 
will have a positive impact on energy development in Indian 
country.
    We support S. 424's approach establishing criteria for 
awarding funding to tribes. We have concern with a factor which 
involves assessing tribes' financial assets. We believe that 
the income from natural resources not be weighed against the 
tribe, especially in cases where the tribe depends on the 
income from natural resources for over 50 percent of its 
government operations. We recommend that this provision either 
be revised or excluded.
    We support S. 424's assignment to priority in awarding 
grants for inadequate electric service that can be 
demonstrated. We suggest, however, that this factor be 
clarified to reflect the housing demand and the lack of 
affordable energy to serve this need. Moreover, due to the 
specific concerns regarding the location of our tribes on a 
single indian reservation, our tribes recommend changes in the 
bill to reflect this circumstance.
    On our reservation there is a large, unmet housing need. 
However, the primary barrier for our members to face in 
building new homes is the cost of the delivery of electricity. 
We recommend that the loan guarantee amount in S. 424 be 
increased from $2 million to $5 million due to the enormous 
need for capital in Indian Country. We support S. 522's 
provisions that recognize and strengthen the enforcement of 
tribal laws.
    We believe the provision of benefit of wind energy 
production on the Wind River Reservation would be streamlined. 
For oil and gas leasing activities, we are not prepared to 
undertake this approach.
    We are concerned with the cost and liability associated 
with the streamlining approach. As a policy matter, we are 
concerned about releasing the Federal Government from the 
responsibilities over energy resource development.
    The current Federal regulatory regime for oil and gas 
leasing places the responsibilities on the BIA, BLM, and MMS. 
Until we gain a better understanding of the streamlining 
process and its impact on oil and gas leasing, we are not 
prepared to release these Federal agencies from their 
responsibilities. Perhaps the pilot project to examine the 
impact on oil and gas leasing would be advisable as a way to 
assess this more fully.
    Our written testimony includes comments on the specific 
streamlining requirements of both bills as well as comments on 
other provisions.
    This concludes my statement. I would be happy to answer any 
questions. Thank you.
    The Chairman. Thank you.
    We will go on with Sam Maynes for the Southern Ute Growth 
Fund.

STATEMENT OF FRANK E. MAYNES, TRIBAL ATTORNEY FOR THE SOUTHERN 
 UTE INDIAN TRIBAL CHAIRMAN, HOWARD D. RICHARDS, Sr., DURANGO, 
                               CO

    Mr. Maynes. Thank you, Mr. Chairman.
    The good news is that we are getting a lot of needed 
moisture in Colorado. The bad news is that the chairman of the 
Southern Ute Indian Tribe couldn't make it out of Denver to be 
here. So he asked me to speak to the committee.
    The Chairman. The last part of that bad news is that you 
probably won't get home with 4 feet of snow in Denver. 
[Laughter.]
    Mr. Maynes. I was going to speak for some time about the 
success story of the Southern Ute Indian Tribe with which you 
are well aware. The Southern Ute Indian Tribe has developed its 
natural resources over the last 20 years within the system that 
we have. However, we have analyzed for the Southern Ute Indian 
Tribe, S. 424 and S. 522. We have submitted a written statement 
to the committee that summarizes and compares the proposed 
legislation. We make several suggested changes which we feel 
are needed to improve the proposals.
    No. 1. S. 522 provisions that address loans and rights-of-
way are much broader in scope than S. 424. Therefore, we 
believe that those types of provisions in S. 522 would be a 
greater help to the tribes. However, there is one provision in 
S. 424 that we would suggest be included in any legislation and 
that would be the Indian Preference Provisions in that 
legislation.
    No. 2. The leasing and rights-of-way proposals of both 
pieces of legislation propose a trade that may be unacceptable 
to some tribes. You eliminate the Secretarial approval in 
exchange for tribes' regulations that require consultation with 
State officials, some type of public notification, and 
ultimately private citizen challenges of approved leases and 
rights-of-way. Traditional notions of tribal sovereignty 
protect tribes from incursion of States and nonmembers in the 
decisionmaking process.
    The Southern Ute Tribe believes this is the wrong approach. 
We think that Congress should be concerned with whether or not 
the tribes are capable of making informed decisions in the 
first place and if they are capable of making those informed 
decisions, they should take the responsibility for their 
mistakes as well as for their good decisions.
    No. 3. Tribes generally do not oppose Federal environmental 
laws. But the proposed legislation shouldn't treat tribal lands 
like public lands. For example, NEPA requirements and public 
comment are inconsistent with the internal decisionmaking 
aspect of tribal sovereignty. We suggested changes to 
correspond with IMDA--the Indian Mineral Development Act--
confidentiality provisions. This is set forth in our written 
statement.
    No. 4. The Southern Ute Indian Tribe joins with this 
gentleman in saying that this legislation should take issue 
with the dual taxation caused by the Cotton Petroleum Supreme 
Court case. Cotton Petroleum makes a disincentive to production 
on tribal lands. We propose and add some legislative language 
in our written statement that would exempt future Indian energy 
development from State taxation to level the playing field.
    Finally, something that is not in the proposed legislation 
would be a revision of the ambiguities that are contained in 
the Non-intercourse Act which was originally passed in 1790. 
The present language that is in the law came about in 1834. 
Many of the statutes affecting Indian tribes have the phrase in 
there, ``Lands subject to a restriction by the United States 
against alienation.''
    There is no distinction between lands held in trust or 
lands held in fee. We give several examples, Mr. Chairman, of 
the problems caused by this in terms of trying to do economic 
development deals and mineral development deals with outside 
interests, outside the reservation--the banks and commercial 
lenders.
    The Non-intercourse Act should not apply to interests in 
lands owned by tribes in fee unless that land is subsequently 
put in trust. If it is not clarified, the Non-intercourse 
language will continue to cause uncertainty as to its 
applicability and continued problems in commercial dealings.
    I can tell you, Mr. Chairman, we have run into that time 
and time again in dealings that the Southern Ute Indian Tribe 
has had with various independent oil and gas companies and 
other oil and gas companies putting together deals where that 
becomes one of the big bones of contention as to whether or not 
the tribe has the power to do it or not.
    In conclusion, Mr. Chairman, the Southern Ute Indian Tribe 
appreciates the opportunity to comment on this proposed 
legislation which is of such critical importance to all energy 
producing Indian tribes. We pledge our support to help this 
committee to work out suitable language that can be considered 
by the entire body.
    Thank you, Mr. Chairman. I would be glad to try to answer 
any questions. I would ask that our written testimony be 
inserted in the record in its entirety.
    The Chairman. Without objection.
    [Prepared statement of Chairman Howard D. Richards, Sr. 
appears in appendix.]
    The Chairman. Thank you.
    Most of the questions will probably be submitted in writing 
as neither Senator Inouye nor Senator Thomas have been able to 
get back.
    I want to just to ask one of each of you.
    Mr. Trujillo, you mentioned 37 percent of the Navajos do 
not have electricity, as I understood you to say. That is 
certainly a sad commentary. What efforts is the tribe doing to 
bring that number down? Are you getting any help from the 
utilities?
    Mr. Trujillo. Thank you, Mr. Chairman. Right now what we 
are doing is working with our utility organization, the Navajo 
Tribal Utility Authority. We have a bill which is called the 
Navajo Electrification Demonstration Program which was 
authorized for $75 million over 5 years.
    Up to this point we have received $3 million. We have been 
able to bring 500 homes electricity. What we are looking at, 
too, is through our new paradigm as we begin to develop new 
generation capabilities, we are looking at developing a 
criteria that would also help support rural electrification for 
our own tribes. This would break that ironic situation where we 
have a generating station that is producing up to 1,500 
megawatts of power. We have homes 1,500 feet away that do not 
have electricity.
    We are working to improve that, Mr. Chairman.
    The Chairman. You provide power for Los Angeles but some of 
your own people cannot get it right next door?
    Mr. Trujillo. That is correct, sir.
    The Chairman. That is sad.
    Mr. Hill, your testimony indicates that you oppose some 
provisions in S. 424 and S. 522 that I thought would streamline 
the mineral lease approval process to put tribes in charge more 
than the Administration.
    The current problem we have with the Bureau, the BLM, and 
the MMS, I thought the goal really was to try to replace that 
with tribal regulations and tribal control.
    Would you like to expand on that just a moment? What would 
you do to modify the existing process to make sure that tribes 
do have more control?
    Mr. Hill. I guess where we have the biggest problem in that 
basically is in the leasing process as the tribes go through 
the approval of sites, or in areas that we are going to develop 
oil and gas. It is basically in the areas of title. From our 
area we send it to the regional office in Billings. That takes 
a long time to do a title search on the lands. That is what 
seems to hold us back. That is basically the biggest problem 
that I see in that.
    The Chairman. Maybe the last question to Mr. Maynes.
    Living there I know very well how progressive the Southern 
Utes are and what a terrific energy story they have to tell. I 
understand other tribes are now visiting the Southern Utes to 
see how they develop their own natural resources. I think that 
is terrific. They have become a model for a lot of Indian 
tribes.
    I just want to say that I am just very proud to have been 
living in that area and watching the development of the 
Southern Ute Tribe. Just for the information for the committee 
and any interested people, that tribe has now become the 
largest employer in Southwest Colorado, not just the county of 
LaPlata, but in about a four or five country area. They are the 
largest employer.
    More than one-half the employees are non-Indians. So with 
all of the development that has gone on with that Tribe, they 
have helped everybody, not just the tribal members. They have 
helped everybody in the area. I would like to think that is a 
standard that we should have all tribes follow in a traditional 
way of Indian sharing, that they not only provide for their own 
people, but in fact they have been good enough to provide for a 
lot of other people, too.
    Thank you all for appearing here. There will probably be 
some questions in writing that will be submitted to you.
    Now we will go to the last panel. Unfortunately, we only 
have about 15 or 20 minutes before I have to go to another 
meeting.
    David Lester, executive director, council for Energy 
Resource Tribes, and Bob Gough, secretary of the Intertribal 
Council on Utility Policy, please come forward.
    We will start with David. Your complete testimony will be 
included in the record and if you would like to abbreviate your 
testimony, that would be good for us. It is nice to see you 
again.

  STATEMENT OF DAVID LESTER, EXECUTIVE DIRECTOR, COUNCIL FOR 
   ENERGY RESOURCE TRIBES [CERT], DENVER, CO, ACCOMPANIED BY 
  VICTOR ROUBIDOUX, BOARD MEMBER, COUNCIL OF ENERGY RESOURCE 
                             TRIBES

    Mr. Lester. It is nice to see you, Mr. Chairman.
    Thank you very much for the opportunity to come before the 
committee to say a few words about the two bills that we are 
very excited about. We are very grateful for the work that your 
staff has done in working with us, Indian tribes, and other 
tribal organizations in pulling together a national perspective 
on this.
    Outside of the remarks that I have prepared, I was very 
taken by the discussion about what will it take to increase 
Indian production for domestic tribal use within their own 
economies for their own people, as well as energy to sell to 
make America more secure in her energy needs.
    The key word, I think, is ``incentives.'' Increased 
production follows increased incentives. We want to increase 
the exercise of our sovereignty, but we don't want a decrease 
in trust protection or in the efficient administration of the 
trust responsibility. Right now the administration of trust 
responsibility within the Department of the Interior falls 
across four separate agencies. That is a decision that was made 
some 20 years ago.
    If the Commission is established, as the Department's 
remarks indicated that they are committed to do, a revisit of 
how it carries out the administration of its trust 
responsibilities would be very welcome, particularly if that 
were staffed or at least the Commissioners came from energy 
producing tribes. We hope that the Commission could increase 
the accountability of the trust.
    There has not been enough emphasis in recent discussions of 
trust. The trust has a protection or enforcement component to 
it as well. It is all well and good to say that the tribe can 
negotiate the best deal it can across the table if that table 
is even, is equitable, and is not asymmetrical in terms of the 
tilt of the table against the tribe. If we have a fair 
negotiating table, then the tribe can negotiate very fair 
deals.
    The question, though, is: Who is monitoring to assure that 
the deals that they won at the table are actually being 
fulfilled in operation? That is a trust responsibility.
    We support leveling the tax field as well. There are 
disincentives in the tax structure against the production of 
Indian energy resources in this country.
    The trust responsibility makes it clear that need should be 
met with support from both the Department of Energy and the 
Department of the Interior for technical assistance, both in 
terms of building tribal institutional capacity and technical 
assistance in doing the resource assessments.
    Information in this business is power. He who has the best 
information at the negotiation table has the best advantage in 
terms of coming out with a deal favorable to their interests. 
Tribes are often disadvantaged in information about their own 
resources. They are relying on companies to come in with their 
own data collection and their own resource assessments.
    As we saw in the Navajo case, the companies have no 
obligation to put all the information on the table for the 
tribes to know. We believe that is a violation of the trust. We 
think that the trust requires that the tribe be given 
assistance so that the asymmetrical nature of the negotiations 
is removed and we have a level playing field.
    We also mentioned strengthening the role of the Federal 
Government as they market for tribal energy, both fuel and 
electricity produced from Indian energy resources. The U.S. 
Government is the largest consumer of energy in the world, both 
in fuels and in electricity.
    The tribes have gone to agencies, have gone to facilities, 
and have gone to Federal agencies, often with no success in 
terms of coming together as partners in development of 
projects. It is hard to get a generation project going. It is 
hard to get a refinery going. It is hard to develop a project 
if you don't have some assurance that you have a customer at 
the other end of the deal. Investors walk away unless they can 
see that there is a customer.
    The Federal Government could play an important role in 
igniting this by being the customer of first choice for many of 
these tribal projects.
    We are also encouraged by the role that energy efficiency 
could play in Indian country because our homes, our facilities, 
our public buildings, have not been built with energy 
efficiency in mind.
    We are not only the poorest communities in America, but a 
higher percentage of our disposable income is going out the 
smokestack, our windows, and the cracks in the doors of our 
homes and our facilities.
    Again, the incentives should be that the savings stay 
within those programs to increase and improve services. The 
beneficiary should not be the U.S. Treasury but rather improved 
services to local Indians.
    We have comments on particular parts of the bill. We will 
expand on those because we think this is really important that 
we bring energy policy in Indian country into and integrated 
with national energy policy. We need to integrate this into the 
policy framework. We also need to be sure that we can access 
transmission and that we can access the market place and be 
players in the biggest energy market in the world.
    I would ask that my written testimony be placed in the 
record.
    [Prepared statement of Mr. Lester appears in appendix.]
    The Chairman. Obviously there are some good in each of 
these bills and maybe some not quite so good. What we hope to 
do is take the best of both. I have suggestions to try to make 
it a better bill.
    Mr. Lester.
    Mr. Chairman, the treasurer of the Iowa Tribe of Oklahoma, 
who is a member of the CERT Board of Directors and the chairman 
of the CERT Board could not be with us. I would like to 
introduce Victor Roubidoux who is accompanying me today.
    The Chairman. Good afternoon.
    If you have some comments, go ahead and present them.
    Your name for the record?

STATEMENT OF VICTOR ROUBIDOUX, BOARD MEMBER, COUNCIL OF ENERGY 
                        RESOURCE TRIBES

    Mr. Roubidoux. Good afternoon, Mr. Chairman and members of 
the committee. I would like to thank the committee for holding 
this hearing and to give the tribes the opportunity to testify 
on their energy visions and their plans for the future.
    My name is Victor Roubidoux and I am a board member of the 
Council of Energy Resource Tribes. I am also the tribal 
treasurer for the Iowa Tribe of Oklahoma. I am pleased to be 
here today to offer brief comments regarding the importance of 
the proposed Indian energy legislation.
    The Iowa Tribe of Oklahoma is working with CERT for the 
advancement of all tribes toward the National Tribal Energy 
Vision adopted by CERT tribes which states that each sovereign 
Indian tribe will have a sufficient and reliable supply of 
electricity at reasonable costs to support his social and 
economic well being.
    The Iowa Tribe and CERT strongly support S. 424 and S. 522 
and urge its enactment. Each tribe is distinct in their energy 
development to achieve their energy vision. The Iowa energy 
plan focuses on three areas: Energy development on our tribal 
lands; energy procurement opportunities with our tribally-owned 
energy marketing company; and energy efficiency and tribal 
member energy programs.
    The legislation to be considered will provide assistance 
for capacity building and to bring down Federal policy, 
regulatory, and financial barriers for tribes to become full 
partner participants in the electricity market place. From my 
tribe's projects, we would directly benefit by the grants to 
further enhance a hybrid wind and natural gas distributive 
generation project to serve the load of our tribal headquarters 
and the potential generation project on our tribal trust lands.
    Also, our tribally-owned energy marketing company, BKJ 
Energy, has partnered with Cintroleum, an Oklahoma energy 
research company. BKJ Energy will provide natural gas, feed 
stock, to gas to liquid production, and demonstration project 
under the DOE's Ultraclean Fuels Program. The pilot 
demonstration facility at the Port of Catoosa near Tulsa, 
Oklahoma, is under construction, and production of the clean 
diesel is expected this summer.
    This partnership aligns itself with the tribe's overall 
environmental policy. Producing a clean and efficient fuel is a 
cornerstone and philosophy. We strongly urge the creation of 
the Office of Indian Energy Policy and Programs at DOE. This 
Office would be essential to promote tribal sovereignty and 
economic self-sufficiency and move these proposals into 
reality.
    Thank you, Mr. Chairman, for your time and attention.
    The Chairman. Thank you.
    Mr. Gough.

STATEMENT OF BOB GOUGH, SECRETARY OF THE INTERTRIBAL COUNCIL ON 
               UTILITY POLICY [COUP], ROSEBUD, SD

    Mr. Gough. Thank you, Mr. Chairman, and members of the 
committee. My name is Bob Gough. I serve as the Secretary of 
the Intertribal Council on Utility Policy. I also am part of 
the Rosebud Sioux Tribe Utilities Commission. Both are 
headquartered out there.
    Rosebud, as you may know, has very recently joined a very 
small group of energy generators in being able to be the first 
tribe as a commercial generator of wind energy in the United 
States. We are delighted to be able to say that.
    It has taken us eight years to go through all the hoops and 
hurdles to try to get this one project up. We think there are a 
number of things in this bill that could certain speed that 
process up. We have very detailed comments in our written 
testimony.
    There are a couple of things that I would like to go over 
with the Committee and bring to their attention. In your packet 
there are some maps that we have provided and some materials 
that show the tremendous energy resources, particularly the 
renewable energy resources, in Indian country--wind, solar, 
geothermal, and biomass. There is a tremendous opportunity for 
these to be the foundations for sustainable homeland economic 
development for tribes today.
    When we start looking at the time it takes to actually put 
in renewables, we are talking a matter of months rather than a 
matter of years. There is no reason that these kinds of things 
cannot be expedited. I just agree with the comments of David 
Lester that there is a need for integration for tribal energy 
into the larger system. But it may not mean that we have to 
wait for an Indian energy bill to go through the whole process 
with a complete new Federal energy policy. There are things 
that need to be done today.
    If you look at incentives, tribes are the only group that 
the Federal Government has a trust responsibility for, and yet 
it is the only group in terms of renewables that there are no 
incentives for. The renewables incentives go to production tax 
credit for those businesses and for-profit operations. It goes 
for municipalities and subdivisions of States. Tribes are left 
out of the picture in terms of incentives.
    In our case we are not asking for increased incentives. We 
are asking to be able to participate in the incentives that 
already exists. This bill does that with regard to REPI, the 
Renewable Energy Productive Incentive. We would like to see 
that bill also do that in terms of making the production tax 
credit available either as tradeable, assignable, or as an 
offset.
    When you look at the renewable potential, particularly wind 
in the Northern Plains, 12 reservations have something on the 
order of 300 gigawatts of wind power potential. To put that in 
perspective, that's 100 times more than all of the Missouri 
River produced. It is about half of the installed electrical 
capacity in the United States. It is a tremendous resource.
    But we need to be able to get it on the grid. That grid is 
run and owned by the Federal Government, the Western Area Power 
Administration. We need Federal help to work as full treaty 
partners, and to be able to get our product on that farm-to-
market road.
    Right now there are disincentives for tribes and for 
renewables to get on that grid. We are the new kids on the 
block in a very old industry. We are going to need to have some 
of those rules changed in a fair way to make sure that we have 
a level playing field to be able to bring this kind of 
production on board.
    The Rosebud Tribe is very excited. Our 8-year planning to 
go in to produce a single turbine of 750 kilowatts has taught 
us many lessons. We have taken it through many hurdles. We are 
ready to spread that information with the other tribes and 
share that. Development can now take place in a much more rapid 
pace because of that.
    We have appreciated the opportunities of working with the 
various Federal agencies. RUS had terms of access for loan 
money that have been available for 50 or 60 years to co-ops but 
not to tribes and not for renewables. They are today because of 
this process.
    What we would ask also is to see if this bill can be done 
in a way that meets the criticism and concerns, and addresses 
those issues brought out in this hearing. It may be moved as a 
stand alone. I think that is very important. There are things 
that could be done today and not hold tribal energy hostage to 
more divisive energy debate that may take years to ultimately 
resolve.
    Many of the provisions of this bill were approved, as I 
understand it, in conference committee last year but the 
overall bill didn't move forward. We have both sides of the 
aisle recognizing a trust responsibility to tribes. We think 
this is one way to do it.
    The Federal Government has a tremendous role to play in 
jump starting the purchase of tribal power, particularly 
renewables. By the year 2005, 19 months ago, 2.5 percent of the 
entire Federal Government's electrical energy purchase 
consumption is supposed to come from renewable energy. Can 
tribes be first in line for that kind of market?
    That kind of power purchase agreement and interconnection 
agreements, that the Federal Government can work with the 
tribes as full treaty partners, can really make the difference 
in moving tribes ahead for producing sustainable homeland 
economic development, energy independence for the United 
States, and a new economic opportunity for Indian tribes.
    With that, I will take questions or yield the time to the 
other members here. I would ask that my statement be placed in 
the record in its entirety.
    [Prepared statement of Mr. Gough appears in appendix.]
    The Chairman. We will have to submit our questions because 
we are running out of time.
    It is my intention to try to bring a consensus bill up for 
a vote in the committee just as quickly as we can meld it, 
hopefully within a couple of weeks. But we will keep the record 
open at least for two weeks if you have any additional comments 
or suggestions as to how we can improve them. I would 
appreciate your doing that.
    Mr. Lester. With your permission, Mr. Chairman, we would 
like to work with your staff to help blend the two bills and 
come out with the strongest possible bill in support of the 
tribal vision.
    The Chairman. I think the timing is right for it, very 
frankly. I don't think that there is anyone in the country that 
doesn't have energy on their mind now, with paying up to $2 and 
more per gallon of gasoline on the West Coast, and the 
dependency on the very country that we are about to get engaged 
in a war. It is just unbelievable that we could do that. So, I 
think the timing is really right.
    Mr. Gough. Mr. Chairman, if I may, I have the honor of 
inviting you, the other members of the committee, and your 
staff, to the Rosebud Sioux Indian Reservation on May 1, for 
our dedication of the beginning of the revolution of new 
renewable energy in Indian Country. Please come.
    The Chairman. I have always been interested in revolutions, 
so I will try to get out there. [Laughter.]
    Thank you. With that, this committee is adjourned.
    [Whereupon, at 4:04 p.m., the committee was adjourned, to 
reconvene at the call of the Chair.]


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                            A P P E N D I X

                              ----------                              


              Additional Material Submitted for the Record

=======================================================================


   Prepared Statement of Hon. Craig Thomas, U.S. Senator from Wyoming

    Thank you Mr. Chairman. I would like to welcome Theresa Rosier, 
Counselor to the Assistant Secretary for Indian Affairs at the 
Department of the Interior, Vicky Bailey, Assistant Secretary for 
Policy and International Affairs at the Department of Energy, and 
tribal leaders, including Chairman Vernon Hill of the Eastern Shoshone 
Business Council, for being here with us today.
    As Congress continues to develop a comprehensive energy bill, 
Indian resources should not be overlooked. American Indian lands 
contain a significant amount of the nation's natural resources. The 
Eastern Shoshone and the Northern Arapaho tribes both rely on revenue 
derived from natural resources--oil and gas in particular--to fund 
governmental operations and provide services to their members. Although 
oil and gas are important to these tribes, energy development potential 
has not been fully recognized on the Wind River Reservation, which is 
over 2 million acres in size. It is in our country's best interest to 
develop these resources in an environmentally responsible manner.
    I am pleased to be a cosponsor of Senator Campbell's energy bill 
because it establishes an Indian energy resource development program 
within the Department of Energy. Senators Inouye and Bingaman have also 
introduced legislation to address the energy needs of American Indians. 
It is interesting to note that 9 of the 15 members on the Indian 
Affairs Committee are also members of the Senate Energy Committee. 
Clearly, Indian energy is a priority for me and my western colleagues 
and I look forward to working with them to develop a bipartisan measure 
that will help American Indian economies and provide our country with 
reliable sources of energy Thank you, Mr. Chairman.
                                 ______
                                 

   Prepared Statement of Theresa Rosier, Counselor to the Assistant 
          Secretary--Indian Affairs Department of the Interior

    Good afternoon, chairman, vice chairman and members of the 
committee. My name is Theresa Rosier and I am the counselor to the 
Assistant Secretary--Indian Affairs within the Department of the 
Interior. I am pleased to be here today to present the Department of 
the Interior's views on S. 522, the Native American Energy Development 
and Self-Determination Act of 2003 and S. 424, the Tribal Energy Self-
Sufficiency Act.
    The Bureau of Indian Affairs [BIA] manages approximately 56 million 
acres of land held in trust for individual Indians and Indian tribes in 
the lower 48 States and Alaska. Currently, there are 1.81 million acres 
of actively leased oil, gas and coal in various phases of exploration 
and development. It is estimated that an additional 15 million acres of 
undeveloped energy resources exist on individual and tribal land. 
Indian energy development plays an important role in the domestic 
production of fossil and renewable energy. In fact, production of 
energy minerals from Indian lands continues to represent over 10 
percent of the total Federal onshore production. Moreover, the 
production from Indian lands in the year 2001 was 13.1 million barrels 
of oil, 285 billion cubic feet of gas and 29.4 million short tons of 
coal. Since most Indian lands are located in sedimentary basins 
possessing geophysical features frequently associated with natural gas 
and oil, the potential for further energy development on Indian lands 
is exciting.
    Increased energy development in Indian and Alaska Native 
communities means increased jobs in these communities. In many Indian 
and Alaska Native communities, joblessness and underemployment are 
painfully acute. This dismal state of affairs has impeded tribal 
economic development and self-sufficiency. More than ever, tribes need 
the job and training opportunities that come hand-in-hand with expanded 
mineral and energy development.
    One of the tragic ironies of life in Indian communities is that 
tribes possess substantial energy resources yet pay some of the highest 
electrical costs or even lack complete access to electricity. The 
Navajo, for example, reside on lands abundant in minerals. They have 
coal, hydrocarbons, and photovoltaic assets. Yet a huge proportion of 
the Navajo people lack access to any electricity at all. Unfortunately, 
blackouts, brownouts, and other kinds of energy disruptions are quite 
common in many Indian communities.
    Consistent with the President's National Energy Policy to secure 
America's energy future, increased energy development in Indian and 
Alaska Native communities could help the Nation have more reliable home 
grown energy supplies. S. 522 promotes increased and efficient energy 
development and production in an environmentally sound manner.
    While the Administration supports the goals and objectives of S. 
522, the promotion of both tribal self-determination and economic 
development, there are several provisions that we look forward to 
working with the committee on prior to moving forward in the 
legislative process. Because this legislation has programs for the 
Department of Energy, the Department of the Interior, and Housing and 
Urban Development, my testimony is appropriately focused on those 
provisions relating to the Department of the Interior.
    S. 522 builds upon the self-determination principles of the Indian 
Mineral Development Act of 1982 to increase tribal control over the 
exploration, extraction, processing and development of fossil and 
renewable resources. Indian tribes are in the best position to 
determine how and when minerals are to be extracted from their lands. 
After all, increased tribal regulation and responsibility for their 
resources is consistent with tribal sovereignty.
    S. 552 would authorize individual Indians and tribal governments to 
enter into energy development leases or business agreements without 
Federal review as long as certain preconditions have been met. The 
preconditions are that the ``Secretary'' has already approved tribal 
regulations which govern these leases and business agreements, and that 
these leases and agreements do not exceed 30 years. Moreover, the bill 
authorizes tribes to grant rights-of-way over tribal lands for 
pipelines, electrical transmission or distribution lines without 
Federal review if the ``Secretary'' has approved the tribal regulations 
which govern the right-of-way, the right-of-way does not exceed 30 
years, and the pipeline, transmission or distribution lines serve a 
facility located on Indian lands or the energy has been produced on 
Indian land. The Department supports tribal regulation and expedited 
review of these regulatory processes.
    As drafted, it is unclear whether this section would apply to the 
Department of the Interior or the Department of Energy. The Department 
believes that it is more appropriate for the Secretary of the Interior 
to approve tribal regulations which govern the leasing of trust or 
restricted lands, business agreements, and rights-of-way conveyance 
because the documentation necessary to approve such tribal regulations 
requires trust records and payments that are under the purview of the 
Department of the Interior.
    Generally, the Department is also supportive of the creation of the 
Indian Energy Resource Commission. Among other things, the Commission 
is tasked to recommend improvements to the current tax structure 
governing Indian energy production. The current tax structure in Indian 
country imposes multiple severance and ad valorem taxes on those who 
extract and operate energy enterprises in Indian country.
    We look to the Commission to recommend ways to facilitate economic 
growth in Indian and Alaska Native communities. Hopefully, this will 
mean more tribal joint ventures, greater tribal participation in the 
building of transmission and distribution lines, and increased tribal 
ownership of power plants and utility companies.
    The Department is strongly opposed to the proposed power of the 
Commission to subpoena testimony and records. We do not believe it is 
necessary for the Commission's mission. The Commission should not be an 
investigatory body, but rather an entity that looks to what the future 
can hold for Indian energy development. In addition, as we understand 
it, even the General Accounting Office does not have authority to 
subpoena records from Federal agencies.
    President Bush's National Energy Policy report established a 
comprehensive, long-term energy strategy for securing America's energy 
future. Both renewable and nonrenewable Indian energy is uniquely 
positioned to play a vital role as the Nation begins to curb its 
dependence on foreign energy supplies. In addition to traditional 
energy sources, alternative and renewable energy sources are also a 
fundamental component to the President's energy policy. Geothermal, 
wind, hydro, and solar energy, while a small percentage of total U.S. 
energy supply and consumption, are important to the long-term energy 
security of this Nation.
    The purposes of S. 424 are to establish an Office of Indian Energy 
Policy and Programs at the Department of Energy; to encourage greater 
tribal self-determination in the regulation of Indian energy leases, 
rights-of-way, and business agreements; to assess and evaluate the 
Indian Mineral Development Act of 1982; to conduct various studies and 
feasibility analysis related to Indian renewable and nonrenewable 
energy; and to authorize certain Indian energy related provisions. My 
testimony will focus on those provisions pertaining to the Department 
of the Interior.
    S. 424 would authorize Indian tribes to lease tribal land for 
electric generation, transmission or distribution, and for a facility 
to refine renewable or nonrenewable energy without Department of the 
Interior approval. This expedited leasing process is available to a 
tribe if two preconditions have been met: (1) the lease was carried out 
under regulations which were already approved by the Secretary of the 
Interior pursuant to provisions in the bill, and (2) the lease does not 
exceed 30 years. Moreover, tribes are also authorized to grant a right-
of-way across tribal lands without Secretary of the Interior approval 
if the right-of way is executed with regulations pre-approved by the 
Secretary, the right-of-way does not exceed 30 years, and the 
transmission or distribution line serves a facility located on Indian 
land, or aids the processing of energy developed on Indian lands. In 
addition, S. 424 authorizes the approval of energy business agreements 
without Secretarial review if a comprehensive environmental review 
process has been completed.
    These provisions promote increased tribal self-determination as 
tribes administer and regulate their tribal energy policy. Moreover, 
energy development promotes increased economic opportunities in Indian 
communities. An efficient, locally controlled regulatory structure in 
Indian communities creates a business friendly environment that 
encourages exciting partnerships between tribes, the private sector and 
the Federal Government.
    This section of the bill requires the Secretary of the Interior to 
conduct a review of the Indian Mineral Development Act [IMDA] of 1982 
and report to Congress within 1 year. The IMDA represented a 
fundamental shift in Indian energy development. Since its enactment, 
Indian tribes have become more proactive in developing their energy 
resources. Since it has been 20 years since its enactment, assessing 
the IMDA is important as tribes and Department begin to develop a 
national Indian energy plan. Currently, the BIA is planning a framework 
for formal consultation with tribal leaders regarding a national Indian 
energy policy. These consultations will build upon the groundwork that 
the BIA has recently completed. Since April the BIA has held six Indian 
energy policy meetings throughout the United States with 
representatives from more than 100 tribes to discuss the development of 
a tribally driven energy policy.
    Thank you for the opportunity to testify before you today to speak 
on a subject that is a priority for this Administration, tribal leaders 
and the American public. It is a very exciting and opportune time to 
focus on increased Indian energy development. I welcome any questions 
that the committee may have.

Prepared Statement of Vicky Bailey, Assistant Secretary for Policy and 
                         International Affairs

    Thank you, Mr. Chairman and members of the committee. I am pleased 
to be here to discuss proposed legislation, S. 424 and S. 522, 
regarding Indian energy policy and to provide you information on the 
Department's current structure and ongoing program. These activities 
recognize Secretary Abraham's affirmation of the Department's 
commitment to meet its responsibilities to Indian country in a manner 
consistent with the government-to-government relationship that exists 
between federally recognized tribes and the Department.
    Introduction Before I begin my formal testimony, I would like to 
commend you, Mr. Chairman, and the entire committee on your leadership 
in addressing the challenging issues before us. We all know that the 
United States is better served when the Federal Government and Indian 
tribes work together to meet common objectives.
    From an energy perspective, Native American reservations contain 
large reserves of oil and gas. There are an estimated 890 million 
barrels of oil and natural-gas liquids, and 5.6 trillion cubic feet of 
gas on tribal lands. This translates into huge potential revenues for 
the tribes even when conservative production estimates are used.
    President Bush recognizes the importance of energy to America: In 
his second week in office, when the President established a group to 
draft a national energy policy, he said that he wanted to ``promote 
dependable, affordable, and environmentally sound production and 
distribution of energy for the future.'' Indian energy resource 
development and energy policy in general are areas where the Department 
and Indian tribes share many mutual interests and can together 
influence America's future in a constructive manner. As Secretary 
Abraham has stated, the Administration wants to work with Congress on 
provisions that facilitate energy development on tribal lands while 
enhancing and protecting the environment.
    The Administration's commitment to a comprehensive and balanced 
national energy policy is in the best interest of all Americans, and 
that is why the President announced his National Energy Policy in May 
2001, less than 4 months after he took office. We face many energy 
challenges that require attention now. Enacting an effective national 
energy policy during the 108th Congress is one of the President's top 
priorities, and we are pleased that both houses of Congress are moving 
forward. As you know, today, a key House subcommittee is marking up 
comprehensive energy legislation. The short- and long-term energy 
supply and demand issues before us, in addition to posing challenges, 
provide an opportunity for us to improve our environment and our 
economy while enhancing our energy future.
    Americans share many common concerns regarding that energy future. 
Even shared concerns may not offer one-size-fits-all solutions. Some 
issues will require different approaches that recognize the unique 
dynamics at play due to any number of factors and circumstances. 
Certainly there are issues unique to Indian country, and we must have 
the tools to address them within our national energy policy framework.
    I would like to provide an overview of the Department of Energy's 
structure in order to provide a reference point for the proposed 
legislation. In implementing Secretary Abraham's written direction to 
Department heads requesting that they honor the government-to-
government relationship that exists between the Federal Government and 
federally recognized Indian tribes, tribal points of contact have been 
established. These 50 points of contact focus on relations with Native 
American tribes and Alaska Natives.
    In addition, within DOE's Office of Congressional and 
Intergovernmental affairs, a Director of Indian Affairs serves as the 
Department's primary point of contact on Native American issues. A 
recent vacancy in that position should be filled in the very near 
future, but the work of the Director continues to be performed through 
our Office of Intergovernmental and External Affairs.
    DOE and our power marketing administrations are committed to 
continuing our work with tribal governments on the many issues in which 
we have a common interest. At this time, I would like to provide some 
insight into how DOE's relationships with American Indians work at the 
program and at the site levels. These representative examples of 
program activities and projects are intended to highlight our 
continuing efforts to improve the energy future specifically for Native 
American Tribes.

Office of Economic Impact and Diversity [ED]

    ED supports nine Native American/Tribal-owned financial 
institutions through the Bank Deposit Financial Assistance Program. 
These banks are located in a seven-state area: California, Kansas, 
Missouri, Montana, North Carolina, and Oklahoma, and hold a total of 
$19.8 million in certificates of deposit to provide development loans 
to minority and women-owned business enterprises. The Native American 
National Bank is the first tribal owned American owned bank to serve as 
a ``Trustee'' for the Department's Bank Deposit Financial Assistance 
Program, and manages $3.7 million in for the Department of Energy.
    ED provides financial support for the National Center for American 
Indian Enterprise Development, which educates and brings together 
Indian individuals, business owners and corporations seeking business 
relationships with the Indian business community.

Office of Energy Efficiency and Renewable Energy [EE]

    EE is developing a Web-based tool to aid tribes in addressing their 
energy needs. The site is intended to provide information on the 
process of developing energy resources, case studies, and other 
information.
    EE has participated in numerous tribal conferences, developed a 
brochure, and developed a website as a means of promoting the program 
and renewable energy technology transfer.
    EE has completed installation of a 750 kW turbine on the Rosebud 
Sioux Indian Reservation (Rosebud, SD). The project successfully 
demonstrated the use of ``green tags'' to finance the installation and 
was the first tribe to obtain a USDA Rural Utility Service loan for 
commercial wind development.

    Western Area Power Administration [WAPA]

    WAPA's 15-State service area includes more than 300 tribes, each 
with distinct histories, values, issues and priorities. Transmission 
line rights-of-way cross 900 miles of reservation and tribal lands--a 
total of approximately 10,500 acres. In view of the importance of 
WAPA's work with Native Americans, a full-time Native American Liaison 
[NAL] position has been established at the Corporate Services Office. 
The NAL will provide consultation guidance to all WAPA Regional offices 
and business functions to develop manage and coordinate Native 
American-related initiatives.
    WAPA is currently allocating power, entering sales contracts and 
negotiating delivery arrangements to ensure Native Americans receive 
the benefit of Federal power. WAPA modified its qualification 
requirements to make it possible for Indian tribes to become new 
customers. WAPA continues to extend power allocations to Native 
American beneficiaries as old contracts expire throughout its service 
territory. Western will continue its negotiations to put in place power 
contracts with 90 Indian tribes and Pueblos in 11 States.
    The Department is reviewing the provisions of S. 424 and S. 522. 
These two bills are comprehensive, and we support the goal of 
maximizing environmentally sound resource development on tribal lands. 
We will continue to study the specific provisions of the legislation 
and look forward to working with you toward achievement of our mutual 
objectives.
    That concludes my prepared statement, Mr. Chairman. I hope that my 
testimony provides you and the other members of the committee with a 
good understanding or the importance this Administration attaches to 
our work with American Indian tribes and Alaska Natives in the context 
of the President's National Energy Policy. I would be pleased to 
respond to any questions you may have.

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