    [Senate Hearing 110-469]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 110-469

               S. 1080, H.R. 2120, S. 2494, H.R. 2963, AND S. 531

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

                                    HEARING

                                   before the

                          COMMITTEE ON INDIAN AFFAIRS
                              UNITED STATES SENATE

                           ONE HUNDRED TENTH CONGRESS

                                 SECOND SESSION

                                       ON

                  S. 1080, THE CROW TRIBE LAND RESTORATION ACT

       H.R. 2120, TO DIRECT THE SECRETARY OF THE INTERIOR TO PROCLAIM AS
     RESERVATION FOR THE BENEFIT OF THE SAULT STE. MARIE TRIBE OF CHIPPEWA
      INDIANS A PARCEL OF LAND NOW HELD IN TRUST BY THE UNITED STATES FOR
                               THAT INDIAN TRIBE

    S. 2494, THE SPOKANE TRIBE OF INDIANS OF THE SPOKANE RESERVATION GRAND
                COULEE DAM EQUITABLE COMPENSATION SETTLEMENT ACT

     H.R. 2963, THE PECHANGA BAND OF Luiseno MISSION INDIANS LAND TRANSFER
                                  ACT OF 2007

     S. 531, A BILL TO REPEAL SECTION 10(f) OF PUBLIC LAW 93-531, COMMONLY
                        KNOWN AS THE ``BENNETT FREEZE''

                                   __________

                                  MAY 15, 2008

                                   __________

             Printed for the use of the Committee on Indian Affairs

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                          COMMITTEE ON INDIAN AFFAIRS

                    BYRON L. DORGAN, North Dakota, Chairman
                     LISA MURKOWSKI, Alaska, Vice Chairman
    DANIEL K. INOUYE, Hawaii             JOHN McCAIN, Arizona
    KENT CONRAD, North Dakota            TOM COBURN, M.D., Oklahoma
    DANIEL K. AKAKA, Hawaii              JOHN BARRASSO, Wyoming
    TIM JOHNSON, South Dakota            PETE V. DOMENICI, New Mexico
    MARIA CANTWELL, Washington           GORDON H. SMITH, Oregon
    CLAIRE McCASKILL, Missouri           RICHARD BURR, North Carolina
    JON TESTER, Montana
          Allison C. Binney, Majority Staff Director and Chief Counsel
         David A. Mullon Jr., Minority Staff Director and Chief Counsel

                                C O N T E N T S

                                  ----------
                                                                       Page
    Hearing held on May 15, 2008.....................................     1
    Statement of Senator Dorgan......................................     1

                                   Witnesses

    Gidner, Jerry, Director, Bureau of Indian Affairs, U.S.
      Department of the Interior.....................................2, 115
        Prepared statement...........................................   115
    Macarro, Hon. Mark, Tribal Chairman, Pechanga Band of Luiseno
      Mission Indians................................................    69
        Prepared statement...........................................    71
    Maxx, Raymond, Chairman, Navajo-Hopi Land Commission.............   103
        Prepared statement with attachment...........................   104
    Nuvamsa, Hon. Benjamin H., Chairman, Hopi Tribe..................   100
        Prepared statement...........................................   102
    Payment, Hon. Aaron, Chairperson, Sault Ste. Marie Tribe of
      Chippewa Indians...............................................    73
        Prepared statement with attachments..........................    75
    Sherwood, Hon. Richard, Chairman, Spokane Tribe of Indians.......    13
        Prepared statement with attachments..........................    14
    Venne, Hon. Carl, Chairman, Crow Nation..........................     3
        Prepared statement...........................................     4

                                    Appendix

    Supplementary letters for the record.............................   125

               S. 1080, H.R. 2120, S. 2494, H.R. 2963, AND S. 531

                                  ----------

                             Thursday, May 15, 2008

                                           U.S. Senate,
                                   Committee on Indian Affairs,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 9:30 a.m. in room
    562, Dirksen Senate Office Building, Hon. Byron L. Dorgan,
    Chairman of the Committee, presiding.

              OPENING STATEMENT OF HON. BYRON L. DORGAN,
                     U.S. SENATOR FROM NORTH DAKOTA

        The Chairman. The Committee will come to order.
        Good morning, and welcome to the Indian Affairs Committee
    hearing on five bills dealing with various land issues on
    specific Indian tribes. These issues are not new; most of the
    bills were introduced in prior Congresses. So we wanted to do a
    hearing this morning so that we might proceed with the
    legislation.
        We want to learn the views of all the interested parties on
    this legislation. Today the Committee will hear views on five
    bills. First is S. 2494, the Spokane Tribe of Indians Grand
    Coulee Dam Equitable Compensation Settlement Act. This bill
    would provide compensation to the Spokane Tribe for the use of
    tribal lands to generate hydroelectric power by the Grand
    Coulee Dam.
        S. 1080, the Crow Tribe Land Restoration Act, this bill
    would provide the Crow Tribe with the tools to address the
    problem of land fractionation within the reservation.
        S. 2963 is a bill to transfer certain lands to the Pechanga
    Band of Mission Indians.
        S. 2120 is a bill that would direct the Secretary of the
    Interior to proclaim certain lands of the Sault Ste. Marie
    Tribe as part of the Tribe's reservation.
        S. 531 is a bill to repeal the Bennett Freeze provision in
    the Navajo-Hopi Lands Settlement Act.
        Today we will hear the views of tribes affected by these
    bills as well as the views of the Department of Interior. I
    encourage any other interested parties who are not on the
    witness list to submit written comments to the Committee. The
    hearing record will remain open for 14 days from today's date
    for those submissions.
        With that, I welcome the witnesses. I know the tribal
    leaders have traveled far to be with us today. We greatly
    appreciate your willingness to testify. We have a rather full
    agenda today, so I ask that you limit your oral testimony to
    five minutes. Your entire written statement will be made a part
    of the permanent record.
        I would note that the Senate will begin a series of votes
    at 11 o'clock, in an hour and a half, and I expect the
    Committee will be done with its business by about that time.
        Again, I want to welcome all of you here. The first panel
    includes Mr. Jerry Gidner, Director of the Bureau of Indian
    Affairs, United States Department of the Interior. Mr. Gidner,
    welcome. You may proceed.

    STATEMENT OF JERRY GIDNER, DIRECTOR, BUREAU OF INDIAN AFFAIRS,
                    U.S. DEPARTMENT OF THE INTERIOR

        Mr. Gidner. Good morning, Chairman Dorgan, Vice Chairman
    Murkowski, members of the Committee. Because some of the tribal
    leaders need to leave to catch a plane soon, I am going to
    testify first about the bills regarding Spokane and Crow, so
    that those chairmen can leave who need to.
        Regarding S. 2494, to provide equitable compensation to the
    Spokane regarding Grand Coulee Dam, the Department opposes this
    bill. We have worked with the Spokane Tribe over several years
    on this issue and believe that negotiations to correct several
    serious issues should continue.
        We have several concerns with the bill. The first is that
    the bill as written envisions the use of appropriated funds to
    pay the tribe and we have not budgeted for the use of those
    funds. It also requires the transfer of land to the Spokane
    Tribe, which was not something that occurred in a similar claim
    that was settled for the Colville Tribe.
        But maybe more importantly, we don't believe the Spokane
    Tribe has brought forth a legal claim that would justify a
    settlement. So we do not believe the legislation is currently
    justified as a settlement of a claim that we believe does not
    exist at this time.
        If there is a transfer of land, we believe it should not
    happen until there is an agreement between the tribe and the
    Government regarding the continued management of the Grand
    Coulee Dam, Lake Roosevelt and the Columbia Basin project. We
    believe that those issues should be resolved before any
    transfer of land occurs.
        Turning to the Crow Bill, the Department supports the goals
    of this bill and supports the general idea of how it would be
    done, essentially loaned to the Tribe to purchase fractionated
    land and then repay the Government. We have concerns about the
    exact mechanism and timing set forth in the bill, so we cannot
    support it at this time. We would like to continue working with
    the Committee and the Tribe on resolving those mechanisms to
    satisfy the concerns.
        With that, I will just conclude my testimony on those two
    bills.
        The Chairman. Thank you, Mr. Gidner. We will call you back
    when the two witnesses who have to leave, leave, Mr. Venne and
    Mr. Sherwood, because of travel arrangement and airplane
    flights.
        I want to ask Mr. Venne, you have heard the testimony of
    Mr. Gidner, you might wish to respond to that. I will ask you
    to go first, but let me ask Senator Tester to provide a proper
    introduction. Mr. Venne, you are becoming a fixture here. I
    believe you have testified a number of times before this
    Committee. We welcome you today. Senator Tester, would you like
    to introduce Mr. Venne?
        Senator Tester. Yes, I would consider it a great honor.
        Chairman Venne is Chairman of the Crow Tribe in the
    southern part of the State of Montana, the largest land mass,
    reservation in Montana. He is an individual who has shown great
    leadership to the Crow People for a good number of years now. I
    met Carl when I was in the State Senate. I think he is a man of
    great vision and common sense. So when Carl talks to me about
    bills such as the Crow Land Restoration Act, with the kind of
    passion that he has for that, it makes me sit up and take
    notice.
        With that, Carl, it is very good to have you here. I know
    you are a very busy man and I really appreciate you taking time
    out of your schedule to come to Washington, D.C. Thank you.
        The Chairman. Chairman Venne, let me thank you for being a
    gracious host when I visited your reservation, as well. It was
    a pleasure to do so. You may proceed.

          STATEMENT OF HON. CARL VENNE, CHAIRMAN, CROW NATION

        Mr. Venne. Good morning. My name is Carl Venne. I have
    served as the Chairman of the Crow Nation since 2002.
        On behalf of the Crow Nation, I want to thank Chairman
    Dorgan and the members of the Senate Committee on Indian
    Affairs for holding this hearing on S. 1080, the Crow Tribal
    Land Restoration Act. I would also like to thank Senator Max
    Baucus and Senator Jon Tester for their sponsorship of this
    important bill.
        S. 1080 directly addresses the serious problems of the loss
    of our homelands through fractionation, allotment and tax
    foreclosure. Furthermore, the Crow Nation land base remains at
    risk with the potential loss of as much as a half a million
    acres or more. The underlying cause of our land base problems
    is derived from the Federal policy of allotment, which deleted
    the Indian land base nationwide by about two-thirds from 1887
    to 1934, from 138 million to 48 million acres. Over a 70-year
    period, Crow territory was reduced by 92 percent to its current
    2.2 million acres.
        How this all came about was the Crow Tribe is the only
    tribe who settled the Cobell case. We were in negotiations with
    the Department of Justice. I think the biggest problem that
    Interior is facing and it is costing them more is the
    fractionation problem in Indian Country. Ten percent of all
    fractionated lands in these United States is on the Crow
    Reservation.
        For the last three years I have been working with Jim Cason
    and Abe Haskill to come up with this bill. I can respond to
    Interior today by saying, this bill, we sat down and worked it
    out with Interior before. To object to it now, I don't
    understand that. It is just alone to the Tribe in the first
    place.
        Let me give you an example of how poor my Tribe is. We have
    a 47 percent unemployment rate. We are the fourth poorest
    county in this Nation. And Interior, it is costing them more
    and more and more to take care of lands on reservation. So when
    I sat down with Interior, it was to solve this problem. Why is
    there a Cobell case today? It is because of this problem,
    because of poor management by Interior itself. I strongly
    believe that the Crow Tribe can manage our own lands for
    ourselves. I have done that. For the last four years, Interior
    has leased tribal lands, they have received about $4 million a
    year. I decided, no, I am going to do it. Today we get over $10
    million a year because of the Tribe managing its own lands.
        From $1.65 an acre to $55 an acre, that is the difference.
    That is why I want to, I need your help to do something like
    this, to retain our lands. It is so important to preserve my
    Tribe, my people. This Nation preserves wild horses in the
    Pryor Mountains. I think as we are the First People of these
    United States, we need to protect our homeland, to secure the
    homeland for the future of our kids, our grandkids and them
    that are not born yet. That is how important it is to my Tribe.
        It is just asking for a loan to purchase these lands. To me
    it is fairly simple. But how important is it? You know, God
    doesn't make any more land. I want to keep ours. I want to
    increase it.
        Today, $50 million to $60 million is derived from the farm
    land that we have. If I had $60 million to $50 million today
    and I owned these lands, I wouldn't need to be coming to
    Washington, D.C. and asking for money. We as a tribe would
    become self-sufficient. That is our goal; to become self-
    sufficient, for us to manage it ourselves and not the Federal
    Government to manage our lands. Give me a chance to make my own
    mistakes. Give me a chance to reap the benefits of these lands.
        We as a tribe have given and given and given our lands. Now
    I want that to stop for my tribe.
        Thank you, Senator.
        [The prepared statement of Mr. Venne follows:]

          Prepared Statement of Hon. Carl Venne, Chairman, Crow Nation
    I. Introduction
        Good morning. My name is Carl Venne and I have served as the
    Chairman of the Crow Nation since the year 2002. On behalf of the Crow
    Nation (Apsaalooke), I want to thank Chairman Dorgan and the members of
    the Senate Committee on Indian Affairs for holding this Hearing on S.
    1080, the Crow Tribe Land Restoration Act. I would also like to thank
    Senators Max Baucus and Jon Tester for their sponsorship of this
    important bill.
        S. 1080 directly addresses the serious problems of the loss of our
    homelands through fractionation, allotment and tax foreclosures.
    Furthermore, the Crow Nation land base remains at risk, with the
    potential loss of as much as a half a million or more acres in the near
    future. The underlying cause of our land base problems is derived from
    the federal policy of allotment, which depleted the Indian land base
    nationwide by about two thirds from 1887 to 1934 (from 138 to 48
    million acres). Over a 70-year period, Crow territory was reduced by 92
    percent to its current 2.2 million acre area.
        Because of allotment and federal probate of Indian property (with
    many Indians dying without wills), the phenomenon of fractionated land
    ownership arose--where several (sometimes hundreds of) owners might
    have varying interests in a single parcel. Similarly, allotment,
    fractionation and the loss of the tribal land base collectively
    resulted in checkerboard ownership of reservation lands, giving rise to
    overlapping governmental authority in Indian country (federal, state,
    tribal and local). Consequently, tribes with heavily allotted lands are
    faced with a situation where they must spend valuable resources trying
    to protect their remaining lands.
        On the other hand, other individuals (non-Indian) owning lands
    within the reservation (and almost everywhere outside of Indian
    country) have a relatively easy time protecting and making use of the
    land they own. Selling land to outsiders for less than its value
    further reduces the land base and the options for tribal citizens, and
    federal attempts to remediate these problems have been unsuccessful.
    Importantly, then, S. 1080 provides a mechanism by which the Crow
    Nation can repurchase significant lands and interests in land and to
    benefit once again from the economic potential of these lands, as was
    the intention of their being originally set aside for the Crow Nation
    and its citizens.
    II. Tribal Land Base, Marshall Trilogy and Problems
    Overview
        Nothing is more important to Indian people than their land. Having
    a protected land base, active and healthy citizens, and defined
    political boundaries is essential to a tribe's sovereignty and
    existence as a government. When Chief Justice John Marshall and the
    U.S. Supreme Court decided the early cases and controversies that
    provided the foundation of federal Indian law, he reflected that even
    under a doctrine of conquest and incorporation, where possible,
    ``humanity demands, and a wise policy requires, that the rights of the
    conquered to property should remain unimpaired; that the new subjects
    should be governed as equitably as the old, and that confidence in
    their security should gradually banish the painful sense of being
    separated from their ancient connexions, and united by force to
    strangers.''
        Even where Europeans saw Indians as mere occupants of their lands,
    they were to be protected in that occupancy. A close reading of the
    Marshall Trilogy, the foundational Indian law cases, reveals that the
    U.S. Supreme Court would have supported a more complete view of
    property rights of tribes when they settled peacefully and allied with
    the United States, as did the Crow Nation from its earliest contacts.
    Moreover, two important but less often cited U.S. Supreme Court
    decisions have recognized and declared that ``Indian lands are as
    sacred as the fee simple of whites.'' See Mitchel v. U.S., 34 U.S. 711
    (1835) (holding that the United States was obligated to respect
    existing Seminole property rights when it gained possession of
    Florida). Similarly, in U.S. v. Shoshone Tribes of Wind River
    Reservation in Wyoming, 304 U.S. 111 (1938), the Court found that ``the
    tribe's right of occupancy was incapable of alienation or of being held
    otherwise than in common, that right is as sacred and as securely
    safeguarded as if fee simple title,'' and that the beneficial use for
    such rights as minerals and timber was vested in the Tribe and not in
    the United States.
        Until 1970, the era of self-determination, federal Indian policy
    decimated the land base and the subsistence possibilities of Indian
    tribes and their citizens. During the reservation era (1830s to 1880s),
    from the idea of Indian Territory (Oklahoma today) to other strategies
    of containment, the United States made treaties with Indian nations
    that asked them to concede vast sections of their homelands in return
    for specific payments and obligations on the part of the United States.
    Importantly, those agreements almost universally contained a guarantee
    of the protected use and enjoyment of the remaining reservation lands.
        After the reservation era, federal Indian policy shifted to
    allotment--breaking up the tribal land base by allotting smaller
    subsections of tribal lands to individual Indians. The overarching
    policy was to break Indians from their culture, dismantle tribal
    governments, and assimilate Indians into mainstream American culture.
    The allotment policy was declared by Congress in the General Allotment
    Act (Dawes Allotment and Severalty Act) of 1887. However, hundreds of
    specific allotment acts were passed by Congress over the subsequent
    forty years that specifically applied to particular reservations. One
    of these specific pieces of legislation was the 1920 Crow Allotment
    Act.
        Even when passed, the Dawes Act was controversial. The motivation
    behind the policy came from the confluence of western settler
    colonialism and white northern liberal progressivism, a powerful
    phenomenon described by President Theodore Roosevelt in his 1901 State
    of the Union Address as a ``mighty pulverizing engine to break up the
    tribal mass''. One of the most vocal opponents of the allotment policy
    was George W. Manypenny, the Commissioner of Indian Affairs who was
    responsible for early allotments as part of the many treaties he
    negotiated with Indian tribes. Arguing against allotment as a federal
    policy, he assessed his earlier work: ``Had I known then, as I know
    now, what would result from those treaties, I would be compelled to
    admit that I had committed a high crime.''
        By 1928, the Meriam Report declared the federal allotment policy to
    be one of the most disastrous federal policies of all time. During
    discussions leading up to the Indian Reorganization Act of 1934, one
    congressman explained the fractionating effects of allotment in this
    fashion:

            ``It is in the case of the inherited allotments, however, that
            the administrative costs become incredible. . .. On allotted
            reservations, numerous cases exist where the shares of each
            individual heir from lease money may be 1 cent a month. Or one
            heir may own minute fractional shares in 30 or 40 different
            allotments. The cost of leasing, bookkeeping, and distributing
            the proceeds in many cases far exceeds the total income. The
            Indians and the Indian Service personnel are thus trapped in a
            meaningless system of minute partition in which all thought of
            the possible use of land to satisfy human needs is lost in a
            mathematical haze of bookkeeping.'' 78 Cong.Rec. 11728 (1934),
            cited in Hodel v. Irving, 481 U.S. 704 (U.S.S.D. 1987).

        In 1934, Congress expressly repudiated the allotment policy with
    passage of the Indian Reorganization Act. Despite this action by
    Congress, the current U.S. Supreme Court repeatedly cites allotment as
    the source for Congressional intent to justify further erosion of
    tribal governance, and simultaneous enhancement of state and local
    authority, over the remaining reservation land base.
        Today, we have to live with the detrimental impacts of poor
    decisions of previous federal policymakers. First, decisions were made
    to remove the Indians from their homelands in the east and place them
    in confined areas in the northern and southern Midwest. Second, federal
    policymakers decided to confine Indian tribes to certain reservation
    lands and repeatedly sought land cessions to allow for non-Indian
    settlement. Third, Congress decided to break up the remaining land base
    with allotment. Finally, Congress terminated its relationship with over
    100 Indian tribes and simply subjected their remaining assets to state
    and local control, with a less than fair market value payment.
    Fractionation
        Throughout Indian country, land fractionation has become a problem
    of unimaginable proportions--touching upon almost every area related to
    land within the reservation. One serious consequence of fractionation
    is that the federal government's trust responsibility toward Indian
    people has been let to lapse. Lease payments on trust lands are paid
    into federal accounts (Individual Indian Money Accounts) of individual
    tribal citizens, under the administration of the United States. In
    Cobell, a primary issue is centered upon the loss and other
    mismanagement of these fractionated interests, funds, and accounts. In
    some cases, some tribal citizens have seen their interests disappear
    altogether while under the care of those who are supposed to protect
    them.
        Federal law defines highly fractionated land as land for which a
    single parcel has 50 or more owners, with no single owner owning more
    than 10 percent of that land, or land that has 100 or more co-owners of
    undivided interests. 25 U.S.C. Sec. 1201. For instance, imagine that
    you owned a piece of land with 50 or more other people, some of whom
    you did not know and others who were very closely related to you. Only
    when you place yourself within this position can you begin to picture
    how difficult every transaction is under such circumstances and you can
    feel a small sense of what fractionation has done. At any moment in
    time, it is likely that some of those fractionated interests would be
    in the process of being probated, further reducing any chance of
    economic viability.
        Another example also demonstrates serious practical problems with
    land in Indian country. A common issue in land ownership on Indian
    reservations is that someone owns a house that is on a home site on a
    larger piece of land (e.g., two acres of land within a hundred and
    sixty acres of land). Even if the home has been built in an agreed upon
    place, it is possible that the land belongs to dozens of other people.
    If the home's ownership follows the land, as is often legally the case,
    then the question of who might inherit that home is an extremely
    complex one. A piece of land that might support eighty home sites may
    have none because financing is unavailable under such circumstances and
    the puzzle of ownership cannot be solved.
        Similarly, what if this parcel of land is completely surrounded by
    land owned by other individuals and some of those owners want to lease
    it to the neighboring land owners to farm? What if some of the owners
    want to allow an energy company to purchase a right-of-way for a
    pipeline or electric line across their property? Some of the shares
    involved are worth fractions of a penny, and yet those owners have
    rights in the lands. What if you needed the agreement of 30 other co-
    owners, and the approval of a federal agency as well, to conduct any
    business with regard to your land? This regime is not tribal or
    communal ownership but a chimera created by federal policy.
        In 1983, Congress passed the Indian Land Consolidation Act (ILCA)
    to address fractionation. Under the ILCA, tribes could work with the
    approval of the Secretary of the Interior to eliminate fractional
    interests and consolidate tribal landholdings. In two later cases,
    various provisions of the ILCA that would appropriate small interests
    without owner consent were struck down as unconstitutional and those
    provisions were later amended by Congress. In sum, the continuing
    onslaught on tribal lands represents the fundamental betrayal of
    federal responsibility toward the first Americans--Indian tribes and
    their citizens--and yet there has been little and ineffective response
    to the concerns of the large land based tribes that suffer the most
    from fractionation issues.
    III. History of the Crow Indian Reservation
        Even though fractionation is a national problem, Indian nations
    have different histories and unique experiences. Many Eastern tribes
    were dispossessed or lost their lands well before the Reservation Era,
    while other tribes were terminated in the 1950s and 1960s and had (some
    continuing) to seek federal recognition and restoration of their lands.
    This is one reason the Indian Land Consolidation Act has not had much
    success--one size definitely does not fit all. Some Indian nations with
    a relatively large land base were not allotted; while others have had
    their whole reservations broken into allotments. For this reason,
    federal legislation must be tailored to individual tribes or small
    groups of tribes.
    Treaties and Allotment
        After the Ft. Laramie Treaty of May 7, 1868, wherein the Crow
    Nation reserved 8 million acres out of 38 million acres designated as
    its lands in an earlier treaty in 1851, a number of acts provided for
    the allotment of Crow lands. Those arguing for the allotment and
    opening of the Crow Indian Reservation to outsiders in the nineteenth
    and twentieth centuries performed a grotesque kind of algebra. They
    determined the needs of individual tribal members and the best way to
    make the Reservation's most valuable lands into so-called surplus
    lands, which were often sold to outsiders.
        In 1919, prior to the 1920 Allotment Act, there were already 2,453
    allotments, consisting of 482,584 acres. In discussions leading up to
    the 1920 Crow Allotment Act, Crow representatives repeatedly stressed
    their desire to keep and protect their lands and to make their own
    decisions. Therefore, as part of the 1920 Act, Congress expressly
    promised to limit other outside interests from swallowing up Crow land.
    In Section 2 of the 1920 Act, the Crow obtained a provision that
    limited outsiders from buying large sections of Crow land.
        According to this provision, the Secretary of the Interior was not
    to approve a conveyance of land to a person, company or corporation who
    already owned at least 640 acres of agricultural or 1,280 acres of
    grazing land within the Crow Reservation. Further, the Secretary of the
    Interior was not to approve a conveyance of land to a person, company
    or corporation that, with the conveyance, would own more than 1,280
    acres of agricultural or 1,920 acres of grazing land. A conveyance of
    Crow land exceeding these restrictions was considered void and the
    grantee was guilty of a misdemeanor, punishable by a $5,000 fine and/or
    6 months in jail.
        Since passage of the 1920 Act, the Crow Nation's federal trustees
    failed to enforce Section 2 of the statute and enforcement continues to
    be non-existent. Today, approximately one third of the acreage of the
    Reservation is owned in violation of the 1920 Allotment Act. By 1935,
    there were 5,507 allotments, consisting of 2,054,055 acres (218,136
    acres were alienated by 1935). Eventually all but the sections of the
    Pryor and Bighorn Mountains on the Reservation were allotted, a total
    of over 2 million acres by 1935 in a reservation that had been reduced
    by cession to approximately 2.2 million acres. Approximately 700,000
    acres of the Crow Reservation, or almost one third of the land mass of
    the Reservation, are presently owned by non-Indians in violation of
    Section 2 of the 1920 Crow Allotment Act.
        The Crow Nation has sought, through a number of means, to have its
    rights enforced but justice has not been served. In the most important
    case on Crow allotment, the Crow Nation sought relief against companies
    that owned large sections of land (45,000 acres and 140,000 acres,
    respectively). In Crow Tribe of Indians v. Campbell Farming Corp., 31
    F.3d 768 (9th Cir. 1994), the Ninth Circuit Court of Appeals held that
    the 1920 Crow Allotment Act did not afford the Tribe a cause of action;
    the Supreme Court denied certiorari in 1995. All of these lands still
    have titles clouded by their Section 2 status, and their situation has
    become more complicated over time.
        Needless to say, failed federal policies and statutes that
    eviscerated the land base of the Crow Indian Reservation in this matter
    are historic and ongoing violations of the treaty relationship between
    the Crow Nation and the United States. Moreover, on an individual and
    collective group basis, even as Indians were being criticized for not
    making the most of their agricultural lands, their opportunity to do so
    was being taken from them along with the lands themselves. Perhaps the
    non-Indian public believed that Crow Indians could not farm; reality,
    however, directly contradicted the public's misperception.
    Livestock and Agriculture
        As J.D. Pearson found in her work on building reservation
    economies, already in 1886, Agent Henry Williamson reported that
    livestock was providing most of the income for the Crow and that they
    owned more than 1,900 head of cattle. Early in the twentieth century,
    federal officials worked to break up successful community gardens at
    Crow because they preferred individual farmers. In 1900, with
    substantial portions of the Big Horn irrigation ditch dug by Crow
    workers, Crow farmers milled almost half a million pounds of flour as
    well as wheat, oats, and hay to feed the reservation. As the irrigation
    system expanded, however, Crows found themselves out of work as,
    despite promises of tribal preference in employment on the irrigation
    projects, both the jobs and the resources that went with them were
    offered to others.
        As with other tribes early in the twentieth century, Crow citizens
    made successful efforts at agricultural pursuits. Reports of the
    Secretary of the Interior for the Fiscal Year Ending June 15, 1915,
    showed that 69.7 percent of the able men of Crow were farmers and
    ranchers, 379 men total. By 1916, the Crow Nation had the largest horse
    herd in the world and a cattle herd of over 30,000 head. The Crow
    Nation was already agriculturally self-sufficient (the professed
    federal goal of allotment) before Congress mandated the 1920 Crow
    Allotment Act. Thus, Crow allotment actually undermined Crow self-
    sufficiency within their own lands.
    Competency and Leasing Crow Lands
        Leasing is another area in which allotment and fractionation have
    added to problems Crow citizens must overcome to benefit from their own
    lands. Lands held in trust for individual Indians often earn money for
    their owners by being leased to others for grazing or agricultural use,
    a practice subject to extreme abuse through the years. In their efforts
    to assert some control over their own lands, Crow representatives
    fought to get statutes passed that affirmed the right of individual
    Indian landowners to approve their own lease rates. A 1926 amendment to
    the 1920 Crow Allotment act allowed ``competent'' tribal citizens to
    make their leases for five year periods without agency approval.
    Several more amendments were passed because of lessee abuse--e.g., some
    lessees would provide small future payments to impoverished landowners
    to control land for increasingly extended periods of time, effectively
    gaining the land for themselves for almost nothing.
        In 1947, the Indian competency provisions extended from the
    original allottees to include their heirs. At this time, on the eve of
    the federal termination era, tribal representatives and congressional
    advocates had to fight once more to prevent the Crow Reservation from
    being taken out of trust altogether. The final language affirmed the
    right of individual competent Crow Indians to approve their own leases.
    Yet today, fractionation has perverted this intent because the common
    definition of a ``competent'' lease at Crow is one having fewer than
    five owners, and the leases for lands with more than five owners must
    still be approved by the BIA. The overall control of the leasing of
    Crow lands rests not with the Crow Nation, its citizens, or even the
    BIA, but rather with outside leasing companies that continue to
    dominate the business.
    Important Example of Current Problems with Leasing
        The Crow competent lease acts were intended to help Crows but
    instead the acts appear to have helped non-Indian residents of the Crow
    Reservation. One especially egregious example (the case is still
    ongoing) will illustrate fundamental problems with leasing individual
    Crow lands. Our Chief Legal Counsel, Donald Laverdure, is by definition
    a Crow competent landowner (only he and his sister, both enrolled Crow
    citizens, own a 320 acre allotment) and can therefore lease his land
    without BIA approval. Over 5 years ago, Mr. Laverdure sought to
    renegotiate his competent lease with a third party leasing agent (who
    represents a consortium of farm families and corporations against
    individual Crow Indians) from 1950s rates to modern lease rates.
        The leasing agent claimed that the lessee could not afford to
    increase rates and simply sought to renew the 50-year old rates. After
    repeated attempts to negotiate, Mr. Laverdure decided not renew his
    lease and instead applied to the local Hardin office of the U.S.
    Department of Agriculture to become eligible to receive drought
    assistance grants and crop rotation grants (he had decided to let the
    land lay idle because of overgrazing and lack of crop rotation and the
    potential grants would be the equivalent of one-half of past lease
    rentals from his former lessee). At a meeting, Mr. Laverdure was
    informed by a local USDA employee and her supervisor that his competent
    Crow Indian land had been leased by the BIA without his notice or
    consent.
        Upon investigation, Laverdure found that one of the USDA employees
    was possibly related, by marriage, to the office manager of the leasing
    company. In addition, Laverdure discovered that the acting BIA
    superintendent, Mrs. Davey Jean Stewart, had exercised unilateral
    authority and granted an office lease of his own Crow competent
    allotment to the existing lessee, without his notice or permission.
    Undoubtedly, this action violates federal law--the Crow competent
    leasing statutes and federal regulations. Even though Laverdure pursued
    administrative relief within the BIA for several years, he did not
    receive a reply, written or verbal, until 2 years after the office
    lease had been granted in violation of federal law.
        Laverdure received a written reply from Mrs. Stewart stating that
    she was exercising her BIA trust duties (on behalf of the entire trust
    land area, not just the specific allotment at issue) in renewing the
    50-year old lease rates to the existing lessees. She said that her
    trust duties demanded that she consider all interests, farming and
    agricultural, and therefore could not follow Laverdure's own wishes
    with respect to his own land. Mr. Laverdure and his sister are still
    pursuing administrative and legal remedies after 5 years, and still
    appear to have no relief in sight.
        Sadly, Laverdure's situation is not unique or isolated. I have been
    informed by several other individual Crow Indians that they have faced
    similar problems. This is an independent reason why my administration
    strongly feels that this Bill, S. 1080, would go a long way toward
    correcting these injustices (Crow Nation would take over administrative
    duties of Crow land in lieu of the BIA). As the Crow Nation purchases
    fractionated interests and Section 2 lands and regulates Crow leases,
    it will restore control and individual autonomy over lands belonging to
    the Tribe and its citizens.
    Fractionation and Probate
        In generations of restricted ownership, the land interests of
    individual Crows have further fractionated until the Crow Reservation
    is the third most fractionated reservation in the nation. Recent
    statistics show 91 tracts at Crow that have over two hundred owners, as
    well as an overall average of 42 owners per tract. This high degree of
    fractionation reduces the value of the lands outright, makes effective
    use by the owners impossible, especially frustrates the interests of
    minority owners, and results in prohibitive administrative costs and
    serious risks of injustice for any transaction.
        While Crow was approved for a model project under the Indian Land
    Consolidation Act, progress has been very slow, resulting in the
    purchase of only a few hundred interests out of hundreds of thousands.
    The pilot program demonstrated a willingness among nearly all
    individual owners to sell their fractionated interests, but did not
    make significant progress toward consolidating the interests under
    tribal ownership.
        Fractionation concerns have also dominated probate reforms under
    the American Indian Probate Reform Act. In the early stages of these
    reforms, Crow and other tribes have been faced with additional burdens:
    (i) communicating the constant changes in law, not including tribal
    probate codes because Interior had not approved a model code; and (ii)
    providing unfunded estate planning assistance to individual Crows. The
    latter burden has become especially important because the Bureau of
    Indian Affairs simply stopped providing estate planning assistance. In
    addition, the Department of Interior has been ineffective in trying to
    overcome huge deficiencies in probate backlogs because many files are
    missing or out of date and the interests at issue are often
    fractionated.
    Cumulative Impact on Crow Reservation Land Ownership
        Today, the Crow Reservation encompasses 2,266,271 acres of lands
    within its exterior boundaries. 534,000 acres are owned by the Tribe in
    trust. 1,038,000 acres are individually owned trust lands. 700,000
    acres are owned in fee by non-Indians. As recognized by the U.S.
    Supreme Court in Montana v. U.S., 450 U.S. 544, 548 (1981), the
    statistical land ownership resulting from the above described legal
    history was: 52 percent Crow allotments; 17 percent Crow Nation trust
    land; 28 percent non-Indian fee land; 2 percent State of Montana fee
    land; and 1 percent federal government land.
        According to more recent Bureau of Land Management Reports, the
    land statistics have shifted slightly: 45 percent Crow allotments; 20
    percent Crow Nation trust land; and 35 percent non-Indian fee land. In
    sum, the pattern of surface ownership generally is ``checkerboard''
    with interspersed Crow Nation trust and fee lands, Crow allotments and
    non-Indian fee lands. The statistics show limited success of the Crow
    Nation in reacquiring lost lands, but the reality is a much larger
    pattern of continued land loss.
    Jurisdiction and Modern Problems
        Allotment and the subsequent transfer of many parcels into fee
    lands, as well as the seizure of reservation lands for non-Indian
    homesteads, has created the infamous ``checkerboard'' pattern of
    criminal and civil jurisdiction. Outside of reservation boundaries,
    different parcels of land are owned by different owners; yet those
    owners do not escape the jurisdiction of the geographic sovereign. On
    reservations where the pattern of ownership is now almost randomly
    distributed between trust and fee parcels, tribal jurisdiction has been
    constantly intruded upon in such a fashion as to make tribal governance
    over the reservation almost impossible.
        Tribes are frustrated in their ability to zone reservation lands,
    to assess taxes to fund government programs and services, to enforce
    their own laws, and even to provide public safety. The definition of
    ``Indian Country'' in 18 U.S.C. 1151 provides a clear definition that
    includes rights-of-way and allotments even after they have passed into
    fee, yet this statute is frequently ignored.
        This checkerboard problem has interfered with Crow's ability to
    govern its own reservation in a myriad of ways. In perhaps the most
    problematic of all Indian law cases, Montana v. U.S., 450 U.S. 544
    (1981), the Tribe's attempts to regulate fishing on its own reservation
    were met with well-orchestrated efforts from outsiders to limit tribal
    sovereignty. Although the Supreme Court provided exceptions to its
    overall rule that Tribes do not have jurisdiction over non-Indians on
    fee lands, it is the general rule that is remembered and the exceptions
    have been interpreted so narrowly as to be almost impossible to meet.
        For example, in Atkinson Trading Co. v. Shirley, 532 U.S. 645
    (2001), the Navajo Nation's ability to assess a hotel occupancy tax on
    a non-Indian hotel and guests within its reservation boundaries was
    struck down under the general rule in Montana. Similarly, in Big Horn
    County Elec. Co-op., Inc. v. Adams, 219 F. 3d 944 (9th Cir. 2000), the
    Ninth Circuit Court of Appeals held that the Crow Tribe was not
    justified in imposing a 3 percent ad valorem tax on rights-of-way used
    by an electric utility for transmission and distribution (the majority
    of consumers are Crow Indians). Only in Indian country do rights-of-way
    escape the jurisdiction of the geographic sovereign.
        Similarly, in Montana v. Crow Tribe of Indians, 523 U.S. 696
    (1998), a case in the courts for two decades that dealt with the
    consequences of double taxation, state and tribal, on the Crow Tribe's
    own coal from its own reservation, the U.S. Supreme Court struck down
    most of the relief sought by the Tribe, which simply asked for its coal
    severance and gross proceed taxes (which the Department of Interior had
    erroneously barred from several years) that were improperly paid to the
    State of Montana. When the Crow Tribe tried to assess a resort tax on
    businesses within the Crow Reservation, that tax was struck down even
    in the bankruptcy proceeding of one of those businesses because it was
    operated by a nonmember on fee land. In re Haines, 245 B.R. 401 (D.
    Mont., 2000).
        Rather than start from a position that an Indian Nation's control
    over its own Reservation is paramount and exceptions to tribal
    jurisdiction must be limited, the Supreme Court in recent years has
    gone out of its way to protect non-Indian fee ownership and then to
    extend the fee context by analogy to rights-of-way and other situations
    on the reservation. The Court has even begun to reverse the historic
    discussion and to use the evils of checkerboard jurisdiction as an
    argument against Indian ownership. This approach shows a clear and
    present threat to tribal survival and the need for immediate measures
    to protect tribal territory and jurisdiction through consolidation and
    land acquisition.
    IV. U.S. Senate Bill 1080, Crow Tribe Land Restoration Act
        S. 1080 was specifically crafted to address the aforementioned
    problems. In the work leading up to a previous version of the bill (S.
    1501), we held public meetings to make sure that there was no serious
    opposition to the actual provisions of the bill, and that there were no
    outstanding budget scoring issues. The bill provides a loan (of up to
    $380,000,000) to the Tribe to purchase Reservation lands and interests
    in lands from willing sellers. Purchased lands will be kept in trust or
    transferred into trust and administered by the Tribe, so that the Tribe
    can benefit from the economic potential of these lands. The lands will
    be made inalienable, so that the Tribe's land base will remain secure.
        Repayments will be made from the earnings of the lands themselves.
    Research done when the BIA average payment per acre for fractionated
    land was $4.28 an acre, subject to further loss from administrative
    costs, shows that as that land approaches consolidated ownership, it
    will approach a higher value. Section 2 lands rented at $20.00, almost
    more than four times as much. Estimates showed that the likely value of
    the fractionated land after purchase by the Tribe would be $7.16 an
    acre. At nearly one million acres of fractionated lands, there would be
    the potential for three million dollars a year just in additional
    revenue to the system from the increased value of the land.
        Senate Bill 1080 has a number of significant advantages.

       It Reduces Fractionation

        The federal government is unable to manage these interests and, in
    many cases, has lost track of the funds they generate for holders of
    Individual Indian Money accounts (see cause of action and litigation by
    plaintiffs in Cobell in case against the federal government).
    Administering fractionated land interests is not the most efficient or
    useful exercise of the federal government's fiduciary duty to tribes
    and individual Indians. It appears that the Act can pay for itself by
    simply removing the costs of administering fractionated interests at
    the federal level.

       It Restores the Crow Nation's Land Base

        At least two purposes of setting aside reservation lands for
    Indians included the provision of a secure homeland and the possibility
    of economic self-sufficiency through agricultural pursuits. Tribal land
    provides a home for tribal citizens, a basis for tribal sovereignty,
    and a means of earning funds necessary for survival. Where reservation
    lands are lost to other owners, tribes have the worst possible
    situation--having to watch others benefit from the lands intended for
    Indians, while being unable to assert meaningful jurisdiction over
    lands within their own reservations. Restoration of the land base has a
    whole range of secondary effects that contribute to the health and
    welfare of the Crow Nation and its residents.

       It Attempts to Solve 1920 Crow Allotment Act, Section 2
            Problems

        The Crow Nation's Section 2 cause of action was preserved from the
    Tribe's settlement of its Norton trust claims. On agreeable terms, S.
    1080 could provide a workable solution to the Tribe's outstanding claim
    for the lands lost when the United States failed to enforce Section 2.
    The bill will save litigation costs, potential damages in this matter,
    and clear title to Crow lands.

       It Effectuates the Crow Nation's Right of First Refusal

        The United States government recognizes the need for tribes to be
    able to regain lost lands and to protect and preserve lands passing
    from individual citizens. Tribes possess the right of first refusal
    when individual tribal citizens wish to sell their trust lands, a trend
    that continues due to ongoing hardship and the inability of individual
    owners to overcome the historic obstacles placed in the way of their
    ownership. At present, the Crow Nation stands to lose hundreds of
    thousands of more acres from its reservation unless it is able to
    exercise its right of first refusal and keep these lands for the
    benefit of the Crow Nation and its citizens. Other potential purchasers
    often fight Crow jurisdiction within its own reservation and that
    leaves all parties with serious issues concerning overlapping tribal,
    federal, state and local government jurisdiction.

       The Potential Land Purchases Will Pay for Themselves

        Particularly as costs continue to increase, there are some
    challenges to repayment. But through repurchase, irrigating more,
    keeping land in its current uses or even reclaiming land for
    agricultural purposes, the Tribe will be able to add to the earnings of
    program lands. We have done extensive research into the costs of
    servicing debt for land repurchase and the earning potential of the
    land, and are comfortable with the outlook of this program under tribal
    management.
        Funds earned in excess of what is needed to make loan payments can
    nonetheless be used to add to the land base and further pay down the
    loans. The bill also provides a necessary five million dollar yearly
    appropriation for administrative costs in implementing the project and
    undertaking tribal management of the acquired lands.

       Additional Costs or Harms Are Insignificant

        Although some fee lands may be returned to trust status in a
    successful land acquisition program, the collection of state taxes from
    these lands is quite minimal and, overall, the Crow Nation provides
    more services to Bighorn County than revenue or services it receives
    from the County. The services and secondary economic benefits provided
    to the County from the Crow Nation's successful use of S. 1080 lands
    will provide a net benefit to the County. The Nation will not have to
    leverage other resources or use other tribal assets.

       All Sales Are Voluntary

        Because the Crow Nation's program will be the purchase of interests
    from willing sellers, the Nation is not forcing or demanding the return
    of ancient homelands.
    V. A Federal Legislative Solution for a Specific Problem
        Some legislation may work for all tribes, but Indian policy,
    geography, and different tribal cultures and histories have left tribes
    in different situations. S. 1080 is designed largely to alleviate the
    particular consequences of land loss and fractionated ownership within
    the Crow Reservation. However, solving land problems at Crow will go a
    long way toward solving fractionation and related problems throughout
    the United States because one-tenth of the land administered by the
    Bureau of Indian Affairs, as trustee for individual Indians, is at
    Crow.
        When the Crow Nation is able to solve its land problems and repay
    the funds loaned under S. 1080, it will be able to use future funds
    earned on its lands for its own future needs, thus saving federal
    dollars. By lowering federal monies spent in administering fractionated
    and other Crow lands, the overall federal responsibility will be
    reduced because the Crow Nation and its citizens will become self-
    sufficient. As such, BIA land assistance can be concentrated upon
    elsewhere in Indian country.
        The fact is that Indian tribes have had many different experiences
    with allotment and land alienation struck different tribes and regions
    differently. Crow has over two million acres of allotted land, second
    only to the Oglala Lakota at Pine Ridge. ILCA intended for tribes to
    develop individual programs and therefore this Bill, S. 1080, is a
    specific legislative effort to accomplish what ILCA has not. Crow's
    actual needs based on allotment--both the extent of allotment and
    fractionation and the amount of allotted land on the present
    Reservation, as well as the other issues addressed in this testimony--
    are some of the most severe in the nation. Crow is also unique in the
    quality of lands available for repurchase and will be able to continue
    agricultural uses and even reclaim lands to make repayment a realistic
    option.
        The Crow Nation, by itself, had almost twice as much land allotted
    as nineteen tribes in Washington combined and almost the same amount in
    alienation. In Oklahoma, over nineteen million acres of land were
    allotted and most of that total, over sixteen million acres, were
    completely alienated from the Tribes. Besides the moral wrongs with
    land loss, the GAA (Dawes Act) of 1887 occurred during a period of
    federalization and today's effects in Indian country amply demonstrate
    the error in trying to create an Indian policy that treated tribes
    without respect for their different cultures and histories.
        Other Indian nations have their own unique stories, which
    constitute in part the government-to-government relationship, and have
    needs that must be met on their own. If you look at the recent history
    of Indian legislation, you will see that there are many bills that
    address the needs of individual tribes on recognition, water, and land
    claims, honoring their individual leaders, responding to specific
    historical wrongs. Thus, this Bill, S. 1080, may not fit the needs of
    the Indian Nations in Oklahoma or Washington, or the Ute Mountain Utes
    and Navajos with lands that were not allotted. No single legislative
    act could meet the diverse needs of these varied histories.
        However, the Crow Nation's unique situation is shaped by its own
    people and culture, by the particularities of federal Indian policy and
    history, and by the failure of its trustees to enforce such laws as the
    Crow competent lease act and Section 2 of the 1920 Crow Allotment Act.
    S. 1080 is designed to meet the very specific needs on the Crow Indian
    Reservation in the most efficient way possible.
    VI. Conclusion
        The Crow Tribe has always been an ally of the United States. At one
    point in the history the United States, the federal government awarded
    more land north of the Yellowstone River to its allies, the Crows, in
    appreciation for their support. Despite being a strategic ally (like
    some other Indian nations), the federal government changed its mind and
    simply took the land away. Further, even though the land of the Little
    Bighorn Battlefield was and continues to be within the Crow Indian
    Reservation, the Crow Nation continues to be treated as a bystander
    with private landowners buying up parcels to preserve and expand the
    Battlefield Memorial without any thought or permission provided by the
    Crow Nation.
        Other individuals that own former Crow Nation land, both on and off
    the Crow Reservation, continue to receive annual federal grants and
    subsidies--without which they would be unsuccessful at keeping the
    land. In contrast, Crow tribal requests to participate in federal
    programs are often met with opposition. Users of Battlefield Memorial
    site and the Bighorn Canyon Recreation Area often trespass and
    recklessly harm Crow tribal lands and the most sacred sites without
    respect, and federal agencies refuse to cooperate with our wishes to
    protect our homeland and our rights.
        It is time for a change. This Bill, S. 1080, is an important step
    in the right direction and it will provide a mechanism for the Crow
    Nation to right many wrongs. S. 1080 can be a model for other tribes
    but only if they believe that they can adapt its central purpose to
    fulfill their own particular needs. From our perspective, passage and
    implementation of S. 1080 will begin to heal old wounds and restore the
    honor that existed in our original, but broken, treaty relationship
    between our two nations, the Crow and the United States.
        We know that Justice Black was right when he said, ``Great nations,
    like great men, should keep their word.'' We have kept our word and we
    simply ask that you do the same. S. 1080 is a Bill that has minimal, if
    no, risk to the United States but is a Bill that can go a long way
    toward restoring the federal promise that exists between our great
    nations. Thank you for your attention and I would be happy to answer
    any questions.

        The Chairman. Chairman Venne, thank you very much. We
    appreciate your testimony.
        Next we will hear from the Honorable Rick Sherwood,
    Chairman of the Spokane Tribe of Indians. Mr. Sherwood, thank
    you for being with us.

    STATEMENT OF HON. RICHARD SHERWOOD, CHAIRMAN, SPOKANE TRIBE OF
                                INDIANS

        Mr. Sherwood. Thank you, Mr. Chairman and members of the
    Committee. My name is Richard Sherwood, I am Chairman of the
    Spokane Tribe of Indians.
        I very much appreciate the opportunity to appear before the
    Senate Committee on Indian Affairs to testify on S. 2494. I
    would also like to thank Senator Cantwell and Senator Murray
    for the introduction of this bill.
        Today I am here on behalf of the Spokane Tribe to ask for
    your help, as representatives of the United States of America.
    I ask that you act on behalf of the United States to finally
    treat the Spokane Tribe fairly and honorably for the injury to
    our tribe and reservation caused by the Grand Coulee project.
        My testimony today summarizes my written statement for the
    record and the critical need for this important legislation. We
    will also be providing photographs to show some of the
    devastating effects that Grand Coulee Dam operations have on
    our reservation.
        The Tribe has been struggling since an agreement with the
    United States in 1877 to secure the boundaries of the Spokane
    Reservation. Our reservation was formed by executive order in
    1881, with 155,000 acres. Today we have 143,000 acres held by
    individuals and tribal trust property, 91 percent ownership of
    the reservation. That shows the importance that the reservation
    land has to the Spokane Tribe. In 1877, our ancestors and
    leaders of the past fought very, very hard for both the rivers,
    the Spokane River and the Columbia River, to be part of our
    boundaries. In the 1930s, due to the Grand Coulee project,
    those lands were taken away. I think for the ancestors that
    fought so hard for that, that is why we are here today. We are
    fighting the same fight that they fought in the 1870s, to try
    to get back control of those lands.
        So when we hear that the Colville settlement didn't have a
    land component to it, at the same time, the Spokane Tribe is
    looking at 39 percent of what the Colvilles received. That was
    the initial thing we brought to the table. So through
    negotiations with everybody, everybody came back to the Tribe
    and said, you know, 39 percent, that is just too much money, we
    have to come up with a solution. So after careful consideration
    from today's council and past councils, we decided we would
    come up with something creative. We decided that we would go
    after land that was rightfully ours to begin with.
        So what the Spokane Tribe has done is actually gone with 29
    percent of what the Colvilles settled for and added the
    original boundaries back, to try to get the original boundaries
    back to trust. Then we hear how the Spokane Tribe doesn't have
    a legal claim. This may be true, but we have been promised and
    promised and promised since the 1930s that the Spokane Tribe
    would be taken care of, that we would make this right.
        So in 1967, the Spokane Tribe settled its claims. In 1951,
    neither the Spokane Tribe nor the Colville Tribe filed claims
    on Coulee. The U.S. was negotiating with both tribes.
        The Colvilles went to the Indian Claims Commission to amend
    and add the Coulee claims in 1975. The Spokane Tribe had no
    claim to amend at that point, we settled in 1967.
        In the 1994 Colville hearing, the Department of Justice
    stated on the record that the Colville Tribe had no legal
    claim, only a moral claim. We are in the same situation, minus
    the fact that in 1975, w didn't have a claim to amend.
        This has had a devastating impact on the Spokane Tribe from
    day one when they flooded our boundaries. It has taken the life
    away from the Spokane Tribe. We have always been a river
    people. To this day, we rely heavily on the river. It has taken
    away our salmon, it has taken away our culture, it has taken
    away our religion. Everything that the Spokane Tribe stood for
    was within that river, and we don't have that today. We will
    never get that back. There is no amount of money in this world
    that will ever return what we have lost.
        I can't stress the importance of what this can do. This
    will help with our unmet governmental needs, health care, fire
    protection, police protection. So it is not just about the
    dollars and cents, it is about trying to make, to right a
    wrong. I think it is an important thing to understand that we
    have been dealing with this for 80 plus years now. And promise
    after promise, and here it is 2008 and I am fighting the same
    fight that my ancestors fought, that my great-grandpa sat here
    as a chairman and fought. So I ask you today, you have the
    opportunity to finally correct that wrong and make it right.
        With that, I thank you and appreciate the time you have
    given me.
        [The prepared statement of Mr. Sherwood follows:]

    Prepared Statement of Hon. Richard Sherwood, Chairman, Spokane Tribe of
                                    Indians
        Thank you Mr. Chairman and members of the Committee. My name is
    Richard Sherwood. I am Chairman of the Spokane Tribe of Indians. I very
    much appreciate the opportunity to appear before the Senate Committee
    on Indian Affairs to testify on S. 2494. Accompanying me are Gregory
    Abrahamson, Vice Chairman of the Tribe, and Howard Funke, our attorney.
    They are available for questions.
    Summary
        I am here today on behalf of the Spokane Tribe to ask for your help
    as representatives of the United States of America. I ask that you act
    on behalf of the United States to finally treat the Spokane Tribe
    fairly and honorably for the injury to our Tribe and Reservation caused
    by the Grand Coulee Project. My testimony today summarizes my written
    statement for the record and the critical need for this important
    legislation. We are also providing photographs for the record which
    illustrate some of the annual effects Grand Coulee Dam operations have
    on our Reservation. The Spokane Tribe has been struggling to protect
    our Reservation since an agreement with the United States in 1877. To
    understand this settlement it must be viewed in an historic context. As
    is fitting and proper for that struggle spanning one hundred and thirty
    (130) years, we have submitted a very lengthy and detailed statement
    herein.
        Grand Coulee's waters flooded the lands of two adjoining Indian
    reservations that held great economic, cultural and spiritual
    significance. Ours is one of those reservations. The other is the
    Colville Tribes Reservation.
        Our life, culture, economy and religion centered around the rivers.
    We were river people. We were fishing people. We depended heavily on
    the rivers and the historic salmon runs they brought to us. We were
    known by our neighboring tribes as the Salmon Eaters. The Spokane
    River--which was named after our people--was and is the center of our
    world. We called it the ``Path of Life.'' President Rutherford B. Hayes
    in 1881 recognized the importance and significance of the rivers by
    expressly including the entire adjacent riverbeds of the Spokane and
    Columbia Rivers within our Reservation. But the Spokane and Columbia
    Rivers are now beneath Grand Coulee's waters. Today our best lands and
    fishing sites lie at the bottom of Lake Roosevelt.
        The proposed Legislation is designed to end a lengthy chapter in
    American history, in which the United States and American citizens
    reaped tremendous rewards at the expense of the Spokane Tribe and the
    Colville Confederated Tribes. The severe devastation wrought upon both
    tribes was unprecedented. And though the effected land areas held by
    the Spokane Tribe were roughly only 40 percent of that held by the
    Colville Tribes, a portion of the Colville's salmon fishery continues
    to reach their Reservation, while the Spokane's was lost entirely.
    Additionally, the Spokanes lost forever a prime site on the Spokane
    River that it could have developed for hydropower. Ultimately, both
    Tribes suffered severely. We are greatly impacted by the operation of
    Grand Coulee Dam each and every year.
        At the Grand Coulee Dam's infancy, the United States acknowledged
    and supported its need to fairly and honorably address the related
    losses to be suffered by both the Spokane Tribe as well as the Colville
    Tribes. Yet the Colvilles, in 1994, secured a settlement with the
    United States, while the Spokane claims are still unresolved. The
    United States has all but ignored its trust obligation to the Spokane
    Tribe. The legislation represents a final settlement of the Spokane
    Tribe's claims, and the following briefly describes the need for the
    United States to finally treat the Spokane people fairly and honorably
    in resolving this matter.
    Historical Context
        From time immemorial, the Spokane River has been at the heart of
    the Spokane territory.
        In 1877, an agreement was negotiated between the United States and
    the Spokane to reserve for the Tribe a portion of its aboriginal lands
    approximating the boundaries of the present Spokane Indian Reservation.
        On January 18, 1881, President Rutherford B. Hayes issued the
    relevant Executive Order, and with exacting language, expressly
    included the Spokane and Columbia Rivers within the Spokane Indian
    Reservation.
        Under section 10(e) of the Federal Power Act (16 U.S.C. 803(e)),
    when licenses are issued involving tribal land within an Indian
    reservation, a reasonable annual charge shall be fixed for the use of
    the land, subject to the approval of the Indian tribe having
    jurisdiction over the land. Had a state or a private entity developed
    the site, the Spokane Tribe would have been entitled to a reasonable
    annual charge for the use of its land. The Federal Government is not
    subject to licensing under the Federal Power Act.
        Numerous statements made by federal officials acknowledged the need
    for the Spokane Tribe to receive fair compensation. In one example,
    William Zimmerman, Assistant Commissioner of Indian Affairs, wrote:

            ``the matter of protecting these valuable Indian rights will
            receive active attention in connection with applications filed
            by the interested parties before the Federal Power Commission
            for the power development.'' Letter from William Zimmerman to
            Harvey Meyer, Colville Agency Superintendent, dated September
            5, 1933.

        A letter approved by Secretary Ickes, from Assistant Commissioner
    Zimmerman to Dr. Elwood Mead, Commissioner of Reclamation, stated in
    connection with the ``rights of the Spokane Indians,'' that the Grand
    Coulee project, as proposed:

            ``shows the cost of installed horsepower to be reasonable and
            one that could bear a reasonable annual rental in addition
            thereto for the Indians' land and water rights involved.''
            Letter from William Zimmerman to Elwood Mead, dated Dec. 5,
            1933.

        The United States Department of Justice has recognized these
    promises as an undertaking of a federal obligation, which promises were
    made to both the Colville and Spokane Tribes.

            ``The government began building the dam in the mid-1930's. A
            letter dated December 3, 1933, to the Supervising Engineer
            regarding the Grand Coulee and the power interests of the
            Tribes, with the approval signature of Secretary of the
            Interior Ickes states:

            This report should take into consideration the most valuable
            purpose to which the Indians' interests could be placed,
            including the development of hydro-electric power.

            We cannot too strongly impress upon you the importance of this
            matter to the Indians and therefore to request that it be given
            careful and prompt attention so as to avoid any unnecessary
            delay.

            Also, a letter dated December 5, 1933, to the Commissioner of
            the Bureau of Reclamation and endorsed by Interior Secretary
            Ickes, stated that `it is necessary to secure additional data
            before we can advise you what would constitute a reasonable
            revenue to the Indians for the use of their lands within the
            [Grand Coulee] power and reservoir site areas.' And a letter
            dated June 4, 1935 from the Commissioner of the Bureau of
            Reclamation requested that additional data be secured to
            determine `a reasonable revenue to the Indians for the use of
            their lands within the power and reservoir site areas.' ''

            Statement of Peter R. Steenland, Appellate Section Chief,
            Environment and Natural Resources Div., Dept. of Justice (Joint
            Hearing on S.2259 before the Subcomm. on Water and Power of the
            Comm. on Energy and Natural Resources and the Comm. on Indian
            Affairs, S. Hrg. 103-943, Aug. 4, 1994, at 16).

        As stated in the testimony of the Assistant Secretary for Indian
    Affairs, concerning the 1994 Colville Settlement legislation, approved
    in P.L. 103-436: ``Over the next several years the Federal Government
    moved ahead with the construction of the Grand Coulee Dam, but somehow
    the promise that the Tribe would share in the benefits produced by it
    was not fulfilled.''
        Pursuant to the Act of June 29, 1940 (16 U.S.C. 835d et seq.), the
    Secretary paid to the Spokane Tribe, $4,700. That is the total
    compensation paid by the United States to the Spokane Tribe for the use
    of our tribal lands for the past seventy-three years.
        When the waters behind the Grand Coulee Dam began to rise, the
    Spokane people were among the most isolated Indian tribes in the
    country. The Tribe's complete reliance on the Spokane and Columbia
    River system had remained largely intact since contact with non-
    Indians. That, however, would be completely and irreversibly changed
    forever. The backwater of the dam, Lake Roosevelt, floods significant
    areas of the Tribe's Reservation, including the Columbia and Spokane
    boundary rivers within the Reservation. A 1980 Task Force Report to
    Congress explains the historical context of the Tribe in relation to
    the Grand Coulee Dam.

            ``The project was first authorized by the Rivers and Harbors
            Act of 1935 (49 Stat. 1028, 1039). In spite of the fact that
            the Act authorized the project for the purpose, among others,
            of `reclamation of public lands and Indian reservations . .
            ..,' no hydroelectric or reclamation benefits flow to the
            Indians. Hardly any were employed at the project site. Indeed,
            the Tribes have presented evidence that even unskilled workers
            were recruited from non-Indian towns far away. The irrigation
            benefits of the project all flowed south. . ..

            Furthermore, the 1935 enactment made no provision for the
            compensation of the [Spokane and Colville] Tribes. It was not
            until the Act of June 29, 1940 (54 Stat. 703)--seven years
            after construction had begun--that Congress authorized the
            taking of any Colville and Spokane lands . . . Section 2 [of
            that Act] required the Secretary to determine the amount to be
            paid to the Indians as just and equitable compensation.
            Pursuant to this authorization the Secretary condemned
            thousands of acres of Indian lands, primarily for purposes of
            inundation by the planned reservoir.

            Apart from the compensation for those lands, which the Tribes
            claim was inadequate, no further benefits or compensation were
            paid to the Indians. Nothing was provided for relocation of
            those Indians living on the condemned lands; and tribal lands
            on the bed of the original Columbia River were not condemned at
            all. Worst of all, Grand Coulee Dam destroyed the salmon
            fishery from which the Tribes had sustained themselves for
            centuries. The salmon run played a central role in the social,
            religious and cultural lives of the Tribes. The great majority
            of the population of the Tribes lived near the Columbia and its
            tributaries, and many were driven from their homes when the
            area was flooded. While Interior Department officials were
            aware that the fishery would be destroyed, the technology of
            the time did not permit construction of a fish ladder of
            sufficient height to allow the salmon to bypass towering Grand
            Coulee Dam.

            The project also resulted in the influx of thousands of non-
            Indian workers into the area. Prior to contemplation of the
            project very few non-Indians lived in the region. Indeed,
            anthropologist Verne F. Ray, who began his field studies in
            1928, reports that there were no more than a handful of white
            families in the vicinity of the future site of the Grand Coulee
            Dam, and that in 1930 the Colville and Spokane were among the
            most isolated Indian groups in the United States. Their
            aboriginal culture and economy were largely intact up to that
            time, little reliance having been placed on white trading
            posts. The subsistence economy of the Indians had continued to
            focus on the salmon.

            Another principal aboriginal pursuit of the Colville and
            Spokane Indians involved the gathering of roots and berries on
            lands south of the rivers. That activity was largely curtailed
            after the construction of the project because of the influx of
            non-Indians on to those southern lands and because the river
            was widened to such an extent that crossing it became very
            difficult. Before the reservoir there were many places where
            the river could be forded. Similarly, hunting south of the
            river was also curtailed. Thus, the Grand Coulee project had a
            devastating effect on their economy and their culture.'' Final
            Report, Colville/Spokane Task Force, Directed by the Senate
            Committee on Appropriations in its 1976 Report on the Water and
            Power Public Works Appropriations Bill, S.Rep.94-505.
            (September, 1980).

        The salmon runs were entirely and forever lost to the upstream
    Spokane Tribe. Further more, there existed on the Spokane River--within
    the Spokane Reservation--two prime dam sites the Spokane Tribe could
    have used for generating hydro electric power. Like the Spokanes'
    salmon runs, these sites were lost forever to Grand Coulee.
        In the 1940 Act, Congress also directed the Secretary of the
    Interior to ``set aside approximately one-quarter of the entire
    reservoir area for the paramount use of the Indians of the Spokane and
    Colville Reservations for hunting, fishing, and boating purposes, which
    rights shall be subject only to such reasonable regulations as the
    Secretary may prescribe for the protection and conservation of fish and
    wildlife.'' 16 U.S.C. Sec. 835(d).
        In an extraordinary move, the Tribe in December, 1941, sent a
    delegation cross-country to meet on the issues with Commissioner John
    Collier. Unfortunately, the meeting took place on December 10--just
    three days following the bombing of Pearl Harbor. The Commissioner and
    his representatives committed to the Tribal delegation that they would
    do all they could in aid of the Tribe, but that the national priorities
    of war meant that redress would have to wait until its conclusion.
        In 1946, the Interior Secretary designated areas within Lake
    Roosevelt as ``Indian Zones'' to fulfill the requirements of the 1940
    Act's ``paramount use'' provisions in recognition of tribal lands
    inundated by Lake Roosevelt. The ``Spokane Indian Zone'' and the
    ``Colville Indian Zone'' were located generally within the reservations
    of those Tribes. The Spokane Zone also extended up the inundated
    Spokane River, within the Spokane Reservation, which today is known as
    the ``Spokane Arm'' of Lake Roosevelt.
    Indian Claims Commission Filings
        In 1946, Congress enacted the Indian Claims Commission Act. Act of
    August 13, 1946 (60 Stat. 1049). Pursuant to that Act, there was a
    five-year statute of limitations to file claims before the Commission
    which expired August 13, 1951. It was under the Indian Claims
    Commission Act that the Colvilles were able to settle their claims in
    1994. And it was due to a quirk of circumstances that the Spokanes were
    not.
        In 1951, both the Spokane Tribe and the Colville Tribes filed land
    claims with the Indian Claims Commission prior to the August 13, 1951
    Statute of Limitations deadline. Neither tribe filed claims before the
    deadline seeking compensation for the use of their lands for the
    production of hydropower at Grand Coulee. Neither tribe understood, nor
    were advised that there would be a need to even file such claims. After
    all, beginning in the 1930s and then resuming through the 1970s, the
    historical and legal record is replete with high level agency
    correspondence, Solicitor's Opinions, inter-agency proposals/memoranda,
    Congressional findings and directives and on-going negotiations with
    the affected Tribes to come to agreements upon the share of revenue
    generated by Grand Coulee which should go to the Tribes for the use of
    their respective lands. The Tribes had every reason to believe that its
    Trustee, the United States, was, although belatedly, going to act in
    good faith to provide fair and honorable compensation to the Tribes for
    the United States' proportionate use of our Tribal resources for
    revenue generated by the Grand Coulee Dam.
        The ICC Act imposed a duty on the Bureau of Indian Affairs to
    apprize the various tribes of the provisions of the Act and the need to
    file claims before the Commission. While the BIA was well aware of the
    potential claims of the Spokane Tribe to a portion of the hydropower
    revenues generated by Grand Coulee, there is no evidence that the BIA
    ever advised the Tribe of such claims. As the Tribe's long-time
    attorney explained in 1981:

            ``The writer was employed in 1955 as the Tribe's first General
            Counsel. The tribal leaders of 1951 were still in office. When
            asked why they had not filed claims for the building of Grand
            Coulee, the destruction of their fishery and loss of their
            lands, they were thunderstruck. They had no knowledge at all
            that they might have filed such claims. They told the writer
            that no one had alerted them to the possibility of such claims.
            They did not know that these potential claims might be governed
            by the Claims Commission Act. They assumed that their rights
            were still alive, and well they may be. The Superintendent had
            approached them in about 1949 with the Tri-partite agreement
            between the BIA, Bureau of Reclamation, and the National Parks
            Service for the establishment of and administration of the
            Indian Zones pursuant to the Act of 1940. While he got them to
            sign pre-written resolutions approving this agreement [so]
            vital to their river and lake rights, not a word was spoken of
            the possibility of the tribe filing claims. The deadline of
            August 13, 1951 was therefore allowed to pass without the
            claims having been filed.'' Memorandum of January 12, 1981 with
            Final Report, Colville/Spokane Task Force (September 1980).

        Thus, the Spokane Tribe in 1967 settled its ICCA claims, while the
    expectation of fair treatment for Grand Coulee's impacts continued.
    Ironically, the Spokane Tribe's willingness to resolve its differences
    with the United States would later be used as justification for the
    United States' refusal to deal fairly and honorably with the Tribe.
        Meanwhile, the Colvilles, who had not settled their ICCA claim,
    continued that litigation against the United States. In 1975, the
    Indian Claims Commission ruled for the first time ever that it had
    jurisdiction over ongoing claims as long as they were part of a
    continuing wrong which began before the ICCA's enactment and continued
    thereafter. Navajo Tribe v. United States, 36 Ind. Cl. Comm. 433, 434-
    35 (1975). Over objections by the United States, the Colvilles sought,
    and in 1976 obtained, permission from the Commission to amend their
    complaint to include for the first time their Grand Coulee claims. With
    new life breathed into their claims, the Colvilles pursued litigation
    of their amended claims to the Federal Circuit Court of Appeals, which
    held that the ICCA's ``fair and honorable dealings'' standard may serve
    to defeat the United States' ``navigational servitude'' defense.
    Colville Confederated Tribes v. United States, 964 F.2d 1102 (Fed. Cir.
    1992). In light of this ruling, the United States negotiated with the
    Colvilles to resolve that Tribe's Grand Coulee-related claims.
    Unfortunately, however, because the Spokane Tribe in 1967 had acted in
    cooperation with the United States to settle its ICCA case, it lacked
    the legal leverage to force settlement.
        In 1967, the Spokane Tribe settled its ICCA claims case. That was
    the very same year that construction of the Grand Coulee Dam third
    power plant containing six new generating units began. The next
    thirteen years witnessed a flurry of activity by the United States to
    address the claims of the tribes to a share of the benefits of the
    Grand Coulee Project.
    Subsequent Negotiations--Both Tribes
        In 1972, the Secretary of the Interior's Task Force began
    negotiation with the tribes through multiple policy, legal and
    technical committees to address the tribal claims. The ``Secretaries
    Task Force'' engaged the tribes on a full range of issues, including
    compensation, riverbed ownership and tribal jurisdiction over the
    inundated Indian Zones.
        In 1974 the Solicitor of the Department of the Interior issued an
    Opinion which concluded, among other things, that the Spokane and
    Colville Tribes each retained ownership of the lands underlying the
    Columbia River and, in the case of the Spokane Tribe, the lands
    underlying the Spokane River. The Solicitor found the United States
    intent to reserve those riverbeds in the Spokane Tribe clear. The
    Opinion suggested that the resource interests of the Tribes were being
    utilized in the production of hydroelectric power at Grand Coulee.
        In December 1975, the Congress directed the Secretaries of Interior
    and the Army to establish a Task Force and to open discussions with the
    tribes:

            ``to determine what, if any, interests the Tribe have in such
            production of power at Chief Joseph and Grand Coulee Dams, and
            to explore ways in which the Tribe might benefit form any
            interest so determined.'' S. Rep, 94-505, Dec. 4, 1975, at 79.

        While these high-level negotiations were taking place, construction
    of the third power plant at Grand Coulee continued. The first
    generating unit of six came into service in 1974.
        In May of 1979, following two years of negotiations among federal
    agencies and the tribes, the Solicitor for Interior proposed to the
    Secretary of Interior a legislative settlement of the claims of the
    Colville Tribe and the Spokane Tribe, stating:

            ``I firmly believe that a settlement in this range is a
            realistic and fair way of resolving this controversy. The
            representatives of the Departments of Energy and Army who
            participated on the Federal Negotiating Task Force concur. It
            adequately reflects the relatively weak legal position of the
            tribes. (If the tribes could get around the Government's
            defenses they conceivably could establish a case for from 15
            percent to 25 percent of the power of the Grand Coulee and
            Chief Joseph dams.) In addition to the threat of legal
            liability to the federal government, there is the undeniable
            fact that the Colville and Spokane people have been treated
            shabbily throughout the 40-year history of this dispute. To
            this day they have received little benefit from these projects
            on their lands which totally destroyed their fishery (no fish
            ladders were included) and inalterably changed their way of
            life. It has been the non-Indian communities and irrigation
            districts who have benefited from these projects. Much
            reservation land remains desert, while across the river
            irrigated non-Indian lands bloom.

            I am also hopeful that this is one ``pro-Indian'' bill that the
            Washington State congressional delegation will support as a
            fair resolution of a sorry chapter of our history. The tribes
            have tried recently to cultivate support for such a settlement
            proposal among key members of the delegation. My understanding
            is that the delegation's concerns have focused on the size of a
            settlement award (tribal demands have referred to hundreds of
            millions of dollars) and a tribal proposal for allocation of a
            firm power supply in the 1980's an allocation which might be
            seen as a threat to domestic users in times of shortage.''
            Legislative Proposal on Settlement of the Claims of the
            Colville and Spokane Tribes, Memorandum of Leo M. Krulitz to
            Eliot Cutler, May 7, 1979.

        We do not know what happened to this Interior Solicitor proposal to
    settle the claims of both tribes. We do know that the sixth and final
    unit of the third power plant was completed in 1980. In that same year,
    the congressional Task Force completed its work. In spite of
    Congresses' direction, rather than determine the tribal interests
    involved in Grand Coulee and the benefits they might derive from those
    interests, for the first time in nearly 50 years of promises and
    negotiations with both tribes, the Task Force asserted legal arguments
    which the United States might use to defend against or forestall any
    tribal claims for a share of the hydropower generated by or the
    revenues derived from the Grand Coulee Project The report concluded the
    United States may not be required by law to provide compensation at the
    same time that the Project's ability to provide benefits to the United
    States and the region was taking a quantum leap.
        The third powerhouse alone provides enough electricity to meet the
    combined power of the cities of Portland, Oregon and Seattle,
    Washington. However, its contribution to the Federal Columbia River
    Power System and the inter-connected electric systems serving the
    western United States goes far beyond the amount of hydropower that is
    generated.
        With completion of the third powerhouse, the Grand Coulee Project
    was positioned to play a pivotal role in the creation of downstream
    hydro power benefits from releases from large Canadian storage
    reservoirs. Grand Coulee became the critical link between water storage
    facilities in the upper reaches of the Columbia River Basin and
    downstream generating assets. Rated at 6,809,000 kilowatts capacity,
    the power generating complex at Grand Coulee became the largest
    electric plant in the United States, third largest in the world. It now
    produces about 21 billion kilowatt hours annually, four times more
    electricity than Hoover Dam on the Colorado River, and is the least-
    cost power source in the region's resource stack.
        In addition to power production, Grand Coulee is the key to
    maintaining operating flexibility and, most important, the reliability
    of the Federal Columbia River Power System and inter-connected systems.
        Without the third power plant in particular, and the Grand Coulee
    Project in general, the configuration and operation of the Federal
    Columbia River Power System would be very different. The electric
    systems serving the Pacific Northwest (and western United States) would
    be less efficient, have much higher average system costs and be far
    less reliable.
        In a sad twist of historical events, two tribes--each feeling the
    irreversible pain of Grand Coulee's devastation--found themselves on
    separate paths. The Colville Tribes were able to continue their legal
    battles with the United States through settlement in the mid-1990s,
    while the Spokane Tribe's willingness to settle in the 1960's cost it
    substantial legal and political leverage in future dealings with the
    United States.
    Continuing Recognition of the Tribe's Interests
        In 1990, the federal government and the Tribes entered into the
    Lake Roosevelt Cooperative Management Agreement, which states that
    ``[t]he Spokane Tribe shall manage, plan and regulate all activities,
    development, and uses that take place within that portion of the
    Reservation Zone within the Spokane Reservation in accordance with
    applicable provisions of federal and tribal law, and subject to the
    statutory authorities of Reclamation . . . to carry out the purposes of
    the Columbia Basin Project.''
        Litigation over the ownership of the original Spokane Riverbed
    resulted in a separate federal court opinion (Washington Water Power v.
    F.E.R.C., 775 F.2d 305, 312 n. 5 (D.C. Cir. 1985)), a court order
    (Spokane Tribe of Indians v. State of Washington, Washington Water
    Power Company and United States of America, No. C-82-753-AAM, Judgment
    and Decree Confirming Disclosure and Quieting Title to Property (U.D.
    Dist. Ct., E.D. Wash., September 14, 1990)). Separate settlement
    agreement (Spokane Tribe of Indians v. Washington Water Power Company,
    No. C-82-AAM, Judgment (U.S. Dist. Ct. E.D. Wash., March 3, 1995)) all
    of which provide and affirm that the Spokane Tribe holds full equitable
    title to the original Spokane Riverbed.
        In 1994 Congress passed the Confederated Tribes of the Colville
    Reservation Grand Coulee Dam Settlement Act (P.L. 103-436; 108 Stat.
    4577, 103d Congress, November 2, 1994) to provide compensation to the
    Colville Tribes for the past and future use of reservation land in the
    generation of electric power at Grand Coulee Dam.

            A. For past use of the Colville Tribes' land, a payment of
            $53,000,000.

            B. For continued use of the Colville Tribes' land, annual
            payments of $15,250,000, adjusted annually based on revenues
            from the sale of electric power from the Grand Coulee Dam
            project and transmission of that power by the Bonneville Power
            Administration.

        In 1994 Congress also directed the Bonneville Power Administration,
    Department of Interior and the relevant federal agencies, under the
    ``fair and honorable dealings'' standard, to enter into negotiation
    with the Spokane Tribe to address the Tribe's comparable and equitable
    claims for the construction and operation of Grand Coulee Dam.
        During the hearing on the Colville Settlement bill, the Spokane
    Tribe sought an amendment that would have waived the Indian Claims
    Commission Act's statute of limitations to enable the Spokane to pursue
    its Grand Coulee claims through litigation. In the words of then Tribal
    Chairman Warren Seyler, ``We believe it would be unprecedented for
    Congress to only provide relief to one tribe and not the other when
    both tribes were similarly impacted.'' Hearing Record, Colville Tribes
    Grand Coulee Settlement, H.R. 4757, pp. 56-61 (August 2, 1994).
        Colville Tribal leaders and the bill's Congressional sponsors asked
    the Spokane to withdraw the request for an amendment to waive the
    statute of limitations. The Spokane complied, with the understanding
    that good faith negotiations to reach a fair and honorable settlement
    with the United States would be imminent. As a result, the following
    statements were made in a colloquy accompanying the Colville Tribes'
    Grand Coulee Settlement legislation. Colloquy to Accompany S. 2259, A
    Bill Providing for the Settlement of the Claims of the Confederated
    Tribes of the Colville Reservation Concerning Their Contribution to the
    Production of Hydropower by the Grand Coulee Dam, and for Other
    Purposes.
        Senator Bradley stated:

            ``S. 2259 settles the claims of the Confederated Tribes of the
            Colville Reservation, yet the claims of the Spokane Tribe which
            are nearly identical in their substance, remain unsettled. The
            historic fishing sites and the lands of the two tribes were
            inundated by the Grand Coulee Project. It is clear that
            hydropower production and water development associated with the
            Project were made possible by the contributions of both tribes.
            Thus, I believe it is incumbent that the United States address
            its obligations under the Federal Power Act to both Tribes.''

        Senator Murray stated:

            ``The settlement of the claims of the Colville Tribes is long
            overdue. The claim, first filed by the Colville Tribes over
            forty years ago, is based upon the authority the Congress
            vested in the Indian Claims Commission, which provided a five-
            year period during which Indian tribes could bring their claims
            against the United States.

            Unfortunately, the Spokane Tribe did not organize its
            government in time to participate in the claims process.

            The fair and honorable dealings standard established in the
            Indian Claims Commission Act should clearly apply to the United
            States' conduct and relationship with both the Colville and
            Spokane Tribes. I would urge, in the strongest possible terms,
            that the Department of the Interior and other relevant federal
            agencies enter into negotiations with the Spokane Tribe that
            might lead to a fair and equitable settlement of the tribe's
            claims.''

        Senator Inouye stated:

            ``I fully support the notion that the United States has a moral
            obligation to address the claims of the Spokane Tribe, and I
            would be pleased to join you in a letter to Interior Department
            Secretary Babbitt urging that negotiations be undertaken by the
            Department.''

        Senator Bradley added:

            ``Under the Federal Water Power Act, which is now referred to
            as the Federal Power Act, where an Indian Tribe's land
            contributes to power production, the licensee must pay an
            annual fee to the Indian Tribe which represents the tribe's
            contribution to power production. I too, would be pleased to
            join Senator Murray and Chairman Inouye in urging the Interior
            Department and the Bonneville Power Administration to enter
            into negotiations with the Spokane Tribe to address the tribe's
            claims.''

        Senator McCain stated:

            I also want to join my colleagues in urging the Department of
            the Interior to seize this opportunity to address the Spokane
            Tribe's comparable and equitable claims for damages arising out
            of the inundation of their lands for the construction and
            operation of Grand Coulee Dam.''

        Thus, as the Colville Tribes' claims were being addressed, the
    United States Congress made clear its intent that the Spokane Tribe be
    treated fairly and honorably in connection with its claims for Grand
    Coulee damages through prompt, good faith negotiations with the
    Administration.
        The Spokane Tribe adhered to the spirit of good faith negotiations
    over the next several years. While the Administration in general
    continued its refusal to take Congress' direction to negotiate fully a
    fair and honorable settlement with the Spokane Tribe, the
    Administration lead shifted from the Department of the Interior to the
    Bonneville Power Administration.
        For the next six years, from 1998 to 2004, the Tribe engaged in
    very difficult negotiations with BPA. Finally, in 2004, the provisions
    of a settlement bill were arrived at in which BPA had no objections.
    Those provisions are contained in S. 2494.
    Legislative History
        Spokane Tribal acreage taken by the United States for the
    construction of Grand Coulee Dam equaled approximately 39 percent of
    Colville acreage taken for construction of the dam. The Spokane
    settlement is based on 39 percent of the Colville settlement. At the
    request of members of Congress, the payment provisions for the Spokane
    settlement bill were reduced to 29 percent of Colville in exchange for
    return of the Tribe's lands taken for the Grand Coulee Project.
        Spokane Tribe settlement legislation has been introduced in the
    106th, 107th, 108th, 109th and this the 110th Congress. In the 108th
    Congress, hearings on H.R. 1797 were held before the House Resources
    Subcommittee on Water and Power on October 2, 2003.
        Hearings were also held on the Senate bill S. 1438, on October 2,
    2003, before the Indian Affairs Committee. The bill was approved by the
    United States Senate on November 19, 2004. The House of Representatives
    adjourned late on November 20, 2004 without time to consider the
    Senate-passed bill.
        A Spokane Settlement Bill was introduced in the 109th Congress. The
    House bill, H.R. 1797, was approved by the House of Representatives on
    July 25, 2005. In the second session of 109th Congress, in 2006,
    subsequent objections to S. 1438 by the State of Washington Department
    of Fish and Wildlife, as well as the Lincoln County Commissioners,
    stalled consideration of the settlement in the Senate. The Senate
    adjourned without vote on the settlement bill.
    Amendments and Support
        The Spokane Tribe has agreed to modify the proposed legislation to
    address various concerns. In 2007, the Spokane Tribe met with the State
    of Washington Department of Fish and Wildlife and the Washington Office
    of the Governor to address their concerns with the settlement bill. The
    Tribe and State entered into an Agreement In Principle on May 1, 2007
    to resolve those concerns. See Attachment A.1. Government-to-Government
    Agreement In Principle.
        The Governor of the State of Washington, Christine Gregoire, also
    voices strong support for this settlement legislation, stating that it
    is ``clearly appropriate'' and ``long overdue''. See Attachment A.2.
        The Tribe and the Lincoln County Commissioners held meetings to
    address the concerns of the Commissioners with provisions of the bill
    affecting the Spokane River. The Tribe agreed to amend the bill to
    address these concerns. Section 9(a)(2) was removed, thereby excluding
    transfer to the Tribe of the south bank of the Spokane River, which is
    located outside Reservation boundaries. Section 9.(a) now confines the
    land to be restored to the Tribe to ``land acquired by the United
    States . . . that is located within the exterior boundaries of the
    Spokane Indian Reservation.'' On June 4, 2007, the Commissioners
    endorsed by letter, ``strong support'' for the settlement legislation
    as amended. See Attachment A.4.
        The Stevens County Commissioners in letters of December 18, 2007,
    request ``renewed support'' of the Tribe and for the settlement.
    ``Please continue in your efforts to get legislation passed which
    finally settles this debt owed to the Spokane Tribe.'' See Attachment
    A.5. The tribe also met with landowners concerned about this provision
    in the bill. The above amendment regarding Section 9(a)(2) resolved
    their stated concerns.
        The Eastern Washington Council of Governments, pursuant to letters
    of January 23, 2008, by Chairman Ken Oliver provides, ``We urge your
    strongest support and consideration for this issue.'' See Attachment
    A.6.
        The Spokane Tribe has reached an agreement with the Colville Tribe
    dated June 17, 2007 providing for a disclaimer provision in the bill
    regarding adjoining Reservation boundaries. See Section 9.
        Section 9(d)(1) was added to provide the United States, Bureau of
    Reclamation full protection for carrying out Columbia Basin Project
    purposes. Section 9(d)(3) was added to fully protect the authority and
    interests of the National Park Service in the National Recreation Area
    within the Reservation. Section 9(d)(4) was added to provide for an MOU
    between the Department of the Interior and the Tribe to provide for
    coordination on the land transfer. The Tribe is on record with the
    Committee agreeing that the MOU be completed prior to the transfer of
    lands back to the Tribe.
        The Spokane Tribe has made numerous and significant concessions
    over the course of negotiations on the provisions of the settlement
    bill. The Tribe has reached agreement with federal agencies, the State
    and county governments, the Colville Tribe, as well as private
    individuals, to resolve their concerns or objections to the bill.
    Administration Objections
        On June 28, 2005, John Keys, the Commissioner of the U.S. Bureau of
    Reclamation sent a letter to Congressman Richard Pombo, Chairman of the
    House Committee on Resources, raising Administration concerns and
    issues with H.R. 1797, Spokane Tribe of Indians of the Spokane
    Reservation Grand Coulee Dam Equitable Compensation Settlement Act.
    Subsequently, the Spokane settlement legislation was approved by the
    House on July 25, 2005, during the 109th Congress. The Commission's
    letter raised three main concerns. These concerns and the Tribe's
    perspective on them and the actions the tribe took to address them are
    discussed below.

            ``First, the Spokane Tribe has not brought forward a legal
            claim that would warrant this type of settlement and there is
            no legal claim pending.''

        This legislation is not a settlement of legal claims, it is ``to
    provide for equitable compensation . . . for the use of tribal lands
    for the production of hydropower by the Grand Coulee Dam . . .''
        The Colville settlement was also not a settlement of legal claims.
    The Department of Justice took the express position before Congress
    that the Colville also had no legal claim; only a ``moral claim''. The
    settlement was based on the history and record of dealings with the
    Tribe. This history and record includes the repeated promises made by
    the U.S. to provide compensation to both tribes.

            ``While plaintiff had no legal and equitable claim based on the
            navigational servitude, they did have a viable moral claim
            based on the ``fair and honorable dealings'' provision of the
            Indian Claims Commission Act of 1946.

            The resolution reached in the proposed settlement does not
            constitute an admission of liability. . .. But, we are prepared
            to recognize that the record, in this timely filed claim, can
            be read to reflect an undertaking by the United States with
            respect to power values. Because of that we think it is fair
            and just to fashion a complete resolution of this longstanding
            claim.''

            State of Peter R. Steenland, Appellate Section Chief,
            Environment and Natural Resources Div., Dept. of Justice (Joint
            Hearing on S. 2259 before the Subcomm. on Water and Power of
            the Comm. on Energy and Natural Resources and the Comm. on
            Indian Affairs, S. Hrg. 103-943, Aug. 4, 1994. at 17).

        Congress has enacted many equitable settlements and jurisdictional
    legislation on behalf of Indian tribes for the flooding of tribal lands
    for the use of hydropower and other purposes in the interest of justice
    and fairness.
        In the 1994 Colville settlement Hearings and Colloquy, senators
    McCain, Bradley, Inouye and Murray instructed the U.S. to negotiate a
    similar settlement with the Spokane Tribe-along the lines of the
    Colville settlement. The Senate Committee and the Colloquy expressly
    noted that both tribes suffered virtually identical harm and yet the
    settlement legislation compensated only the Colville Tribe. Specific
    quotes from that colloquy are contained in this statement under
    CONTINUING RECOGNITION OF THE TRIBE'S INTERESTS at pp. 9-12.
        The U.S. made express promises to compensate both tribes with a
    share of the power revenues for the use of tribal lands in 1933 and
    1935. See HISTORICAL CONTEXT at pp. 2-3.
        The DOI Associate Solicitor Memorandum of 1976 states that the U.S.
    behavior toward both tribes amounted to an ``act of confiscation'',
    where the trustee converts the property of the beneficiary to his own
    use.

            ``The Department has not only failed to give the Tribes a share
            of the benefits of developing tribal property, but in the
            development has largely destroyed what other economic bases,
            fishing, farming and timbering, the Tribes may have had in
            their remaining property. The blatant lack of care taken by the
            Department to protect its own fiduciaries is confirmed by the
            letters and background activity described previously in the
            Statement of Fact. In the case of Grand Coulee, the Department
            knew precisely what destruction was being caused and what types
            of compensation of tribal property were appropriate. . ..
            Finally, given the knowledge the Department had of the Indian
            rights and needs at stake, it appears to have been derelict in
            not informing Congress of these, so that congress could take
            informed and specific action. . .. No case law grants executive
            agencies authority to unilaterally abrogate Indian rights.
            Certainly throughout the construction of these two projects,
            the posture of the Department can be described not as . . . an
            exercise of guardianship, but an act of confiscation.''

            Memorandum from Lawrence A. Aschenbrenner, Acting Associate
            Solicitor, Division of Indian Affairs, to Solicitor, p. 13
            (1976) (emphasis added).

        In 1975, Congress authorized the Grand Coulee Task Force ``to
    determine what, if any, interests the Tribes have in such production of
    power at Chief Joseph and Grand Coulee Dams, and to explore ways in
    which the Tribes might benefit from any interest so determined.'' S.
    Rep. 94-505, Dec. 4, 1975, at 79.
        In the interim, in 1979, the Solicitor for Interior proposed to the
    Secretary of the Interior a Congressional settlement of the claims of
    the Colville and Spokane Tribes, stating,

            ``I firmly believe that a settlement in this range is a
            realistic and fair way of resolving this controversy. The
            representatives of the Departments of Energy and Army who
            participated on the Federal Negotiating Task Force concur.

            Legislative Proposal on Settlement of the Claims of the
            Colville and Spokane Tribes, Memorandum of Leo M. Krulitz to
            Eliot Cutler, May 7, 1979.

        In the 1980 Task Force Report, the U.S. instead, for the first
    time, asserted legal defenses against the Tribes' claims and denied
    compensation.

            ``[I]n 1975, the Senate Committee on Appropriations directed
            the Secretaries of the Interior and Army to open discussions
            with the Tribes to assess a resolution of this dispute. S. Rep.
            94-505, p. 79. Pursuant to that directive, a task force,
            consisting of the Departments of the Interior and Army, and the
            Bonneville Power Administration, issued a final report in
            September 1980.

            The report was approved by the Secretary of the Interior. It
            concluded among other things that there was ``no question but
            that the Tribes would be entitled to compensation had the
            projects been built and operated by the Federal Power Act
            licensees,'' and that the Tribes would have received a
            reasonable benefit as fixed by that Commission pursuant to
            Section 10(e) of the Federal Power Act. The report further
            suggested that the legal defenses of the United States be
            exhausted with respect to navigational servitude before further
            action be taken regarding the Tribes' power claims.''

            Statement of Peter R. Steenland, Appellate Section Chief,
            Environment and Natural Resources Div., Dept. of Justice (Joint
            Hearing on S.2259 before the Subcomm. on Water and Power of the
            Comm. on Energy and Natural Resources and the Comm. on Indian
            Affairs, S. Hrg. 103-943, Aug. 4, 1994, at 16).

        Following the 1994 Colville Settlement, the Spokane Tribe attempted
    to carry out the negotiation of a settlement with DOJ and DOI. The
    Tribe consistently, over several years, got nothing but bounced back
    and forth between the run-a-round from both agencies and no actual
    negotiations occurred.

            ``The hearing records show that Committee members in both the
            House and Senate were sensitive to the need to provide a
            settlement for the Spokane Tribe. The report of the House
            Natural Resource Committee directs the Departments of the
            Interior and Justice to negotiate with the Tribe to settle its
            claims. In the Senate, a colloquy between Senators Murray,
            Inouye, Bradley and McCain stressed that appropriate federal
            agencies should negotiate with the Spokane Tribe.

            Based on the foregoing, we are requesting that the Department
            proceed as soon a possible to negotiate with the tribe on its
            power value and fishing claims as previously directed by
            Congress.''

            Letter from Sen. Patty Murray, Sen. John McCain, Sen. Daniel
            Inouye, Sen. Bill Bradley, and Rep. George Nethercutt to Bruce
            Babbitt, Secretary of the Interior, dated July 9, 1996.

            ``The claims of the Spokane Tribe of Indians are virtually
            identical in substance to those of the Colville Tribes related
            to construction and operation of the Dam: loss of religious,
            fishing, burial, power and irrigation sites. While the region
            received significant benefits, the Tribe suffered devastating
            impacts on their culture, lifestyle and economy which have not
            yet been addressed. Because of the Administration opposition,
            the Congress did not settle the Spokane claims when the
            Colville Settlement Act was passed, nor did the Settlement Act
            waive the ICCA statute of limitations to open the door for the
            Spokane Tribe's equitable claim.

            The Congress did, however, recognize this Nation's need to
            resolve the Spokane Tribe's claims regarding Grand Coulee Dam.
            In fact, the House Committee Report on the Colville bill
            directs the Departments of Interior and Justice to work with
            the Spokane Tribe to address the Spokane Tribe's claims on
            their own merits. A colloquy among Senators Bradley, McCain,
            and ourselves in November 1994 expressed the same direction to
            the agencies as the House Report.

            We are therefore frustrated that three years after enactment of
            the Colville Tribes's Settlement Act, the Departments, while
            conducting numerous meetings with the Tribe, have still failed
            to enter into negotiations.

            We continue to believe it is grossly unjust for one Tribe to be
            compensated while a similarly affected neighboring Tribe is
            left with no remedy. Therefore, in the strongest possible
            terms, we urge the Departments to enter into negotiations with
            the Spokane Tribe immediately so that a fair and equitable
            settlement of the Tribe's claims can be reached. A resolution
            of the Spokane claims, of course, must involve payment for past
            damages, as well as payment for future power revenues.''

            Letter from Sen. Patty Murray and Sen. Daniel Inouye to Bruce
            Babbitt, Secretary of the Interior and Janet Reno, Attorney
            General, dated March 2, 1998.

        The Spokane Tribe finally sought legislative help from Senator
    Murray and Congressman Nethercutt, and asked for a jurisdictional bill
    to allow the Tribe to file a legal claim and have it's day in court
    with the U.S.. The DOJ strongly opposed this effort.
        That is why there is no legal claim. The Colville did not have one
    either. Both Tribes did not file Coulee claims in 1951. Both Tribes did
    not have legal claims. Both Tribes have equitable moral claims. Only
    one Tribe is being compensated. The U.S. misled both Tribes with
    promises and negotiations and then reversed position by asserting legal
    defenses 40 years after the fact when the compensation stakes got too
    high. Words where much cheaper than fair compensation. Since the
    Spokane Tribe had settled their claims case with the U.S. in 1967, they
    had no claims case to amend to later add Grand Coulee claims.

            ``The Administration therefore believes it would be premature
            to assume that future budget proposals will recommend . . .
            appropriations at the levels proposed in the bill.''

        The impact on BPA ratepayers would be approximately 9 cents per
    megawatt hour ($0.09). That represents a 0.14 to 0.31 percent increase
    in BPA rates. This is about as close to a zero impact as one could
    calculate. BPA clearly should be able to reduce costs by one or two
    tenths of one percent to cover the cost of the annual payment proved
    for in Section 6 of the bill.
        The Senate Committee and the House Report instructed the U.S. to
    negotiate a settlement with the Spokane along the lines of the Colville
    settlement.
        The Spokane lost the equivalent of 39 percent of the lands the
    Colville lost to Grand Coulee. The Spokane bill provides the equivalent
    of 29 percent of the Colville settlement payments adjusted for
    inflation from the date of the Colville Settlement Act, in addition to
    the return and transfer of lands in Section 9.
        The Spokane also lost all salmon runs and two of their valuable
    hydropower sites on the Reservation.

            ``Second, the Department is concerned with transferring land
            and jurisdiction . . . absent a prior written agreement to
            fully address future management responsibilities.''

        Following release of the Administration/Keys letter on June 28,
    2005, the Tribe met with U.S. DOI/BOR officials, including the
    Commissioner of BOR, on July 12, 2005 and came to an agreement that the
    land transfer would not take place until the MOU between the U.S. and
    the Tribe called for in Section 9(c)(4) was completed. This agreement
    was communicated to the Committee via a July 21, 2005 e-mail message
    from Tribal Attorney, Howard Funke to Majority and Minority Counsel,
    Senate Committee on Indian Affairs (proposing Senate report language
    evidencing this agreement).

            ``Third, what specific duties are required of the Secretary . .
            . with respect to trust lands? ''

        The bill was amended to add current Section 9.(b)(2) FEDERAL TRUST
    RESPONSIBILITY. The Federal trust for all lands transferred under this
    section shall be the same as the responsibility for other tribal land
    held in Trust within the . . . Reservation.
        The Department of the Interior is well versed in its trust
    responsibility for Indian Reservation lands. These Spokane Reservation
    lands returned to the Tribe are no different.
        The Tribe understands that the Department of the Interior, despite
    these modifications to the legislation and the historical context for
    such a settlement, continues to have virtually the same three issues
    with the Spokane settlement legislation. The House, in the 109th
    Congress approved the Spokane settlement legislation, with knowledge of
    these issues.
    Conclusion
        The Tribe has exerted significant efforts to retain its homelands,
    to receive the benefit of the promises made by the United States to
    reserve our lands, and to fairly compensate us for the use of our lands
    for the production of hydropower. Our people have endured enormous past
    and present impacts to their resources, their way of life and their
    culture due to operation of the Project. Grand Coulee delivers enormous
    benefits to the United States and the region. The Colville Tribes,
    similarly situated directly across the Columbia River, share in the
    benefits of the Project. The Spokane deserve fair and honorable
    treatment by its trustee, and the region, in a settlement due them for
    the use of their lands for the production of hydropower and many other
    Project purposes.

        The Chairman. Mr. Sherwood, thank you very much.
        To my colleagues, I indicated at the start that Mr. Gidner
    would be discussing the first two bills, because the witnesses
    had problems with travel schedules and will have to leave to
    catch an airplane. Mr. Gidner will stay on the panel as we
    receive the other witnesses.
        I also indicated that we have votes beginning at 11
    o'clock, so my hope will be that we will finish these bills,
    including the second panel of witnesses, by 11 o'clock.
        Let me call on Senator Tester for questions and then
    Senator Barrasso.
        Senator Tester. Chairman Venne, you say you have 2.2
    million acres in your reservation. How many acres of that is
    fractionated?
        Mr. Venne. Probably about 80 percent of it.
        Senator Tester. Eighty percent of it. If we get this bill
    through, how long would you anticipate, and I know this is a
    crystal ball question, but I have to ask it, how long would you
    anticipate it taking to get the land back in a form where it is
    developable?
        Mr. Venne. We have discussed this with Interior and they
    gave me a time line for about five years to get this project
    done.
        Senator Tester. And it is a project, if I understand, about
    $380 million, 80 percent of 2.2 is about 1.6 million plus 1.7
    million acres?
        Mr. Venne. Yes.
        Senator Tester. Okay. Mr. Chairman, do you want them all
    directed to the chairmen of the tribe and we will save Jerry
    Gidner for later?
        The Chairman. Let us save Mr. Gidner until the other
    witnesses have testified, if that is satisfactory.
        Senator Tester. That would be good. That is all I had. I
    just want to clarify one thing that you said: 10 percent of the
    total fractionated land in Indian Country in the United States
    is on the Crow?
        Mr. Venne. Yes, it is.
        Senator Tester. Okay. The average, the way the allotments
    work and the way it has been split up over the last many, many
    decades, is it 40, 50 people average on each parcel?
        Mr. Venne. Yes, at least 40 to 50 people. Some are over
    200, some are even over 1,000 owners.
        Senator Tester. Do you have records on the reservation or
    do they have records in the courthouse? How do you know who to
    contact?
        Mr. Venne. We have all the records on each parcel of land
    and who owns it and how many people own it.
        Senator Tester. The last question I have, the $380 million,
    the way I read it, is that it is used for the purpose of buying
    the land to consolidate. It looks to me like there are going to
    be some pretty heavy administrative costs here, especially if
    you have parcels of land with up to 1,000 people owning them.
    Have you figured that into the equation and do you have the
    ability to handle that onsite?
        Mr. Venne. Yes. The present realty office, their budget is
    about $1 million a year. By the Crow Tribe doing it, Interior
    had agreed to give us $5 million a year to take care of this
    problem. I think that would be sufficient to do it. We were
    talking about, the bill, if it passes, I have to go back to
    Interior to negotiate how everything else is going to come into
    play. So this is not the final. What if we don't come to an
    agreement with Interior? That is why I was a little hesitant to
    say, why isn't Interior supporting this bill when it actually
    came out of Interior here in D.C. with the Crow Tribe to take
    care of the fractionated lands? If you look at Interior's
    budget, there is doubt, and the statistics are out there, that
    it is going to keep costing, costing more and more every year
    to handle fractionated interests in Indian Country.
        Senator Tester. This will truly be my last question. You
    talked about your negotiations. The negotiations that you have
    had surrounding this bill, and you said it in your testimony, I
    just didn't write it down, the negotiations you have had have
    been with Interior or with BIA or with both?
        Mr. Venne. Both.
        Senator Tester. Okay.
        The Chairman. Senator Barrasso.
        Senator Barrasso. Thank you very much, Mr. Chairman.
        First, Chairman Sherwood, I think I heard you say that you
    were sitting in the same seat that your great-grandfather sat
    in many years ago, fighting. I think he would be very proud of
    you today. Congratulations, you do an outstanding job.
        Mr. Sherwood. Thank you.
        Senator Barrasso. First of all, Chairman Venne, a couple of
    things. I heard the huge number, the large number for
    unemployment in your community. I want to congratulate you on
    your efforts to develop your resources, to increase value, to
    increase productivity and use of the land, to become self-
    sufficient. As the neighbor to the south, everything you do to
    benefit your own I believe helps communities on both sides of
    the Wyoming-Montana border.
        I do have some questions on S. 1080, the Crow Tribe Land
    Restoration Act. As we are neighbors, this bill in essence has
    about three moving parts on our neighboring relationship on the
    river between Wyoming and Montana. There are the tribes' 1868
    water rights that predates the States of Wyoming, the States of
    Montana and even the Eastern Shoshone and Northern Arapaho
    Tribes in Wyoming. There is the Crow Compact, a complex
    agreement between the State of Montana and the Crow, which was
    designed in 1999 to quantify the Tribe's water rights. And we
    have this land bill, which would address the Crow Tribe's
    difficulties with land issues. It would aid the Crow in
    purchasing lands that have water rights attached.
        All of us as neighbors need to understand how the purchase
    of these lands will affect the water rights on the Big Horn
    River. And I hear a lot about that from the folks in Big Horn
    County in Wyoming. So I am sensitive to protecting existing
    rights. I can understand the need to quantify and clearly
    assign water rights. I recognize that the Crow Tribe is trying
    to do the best that it can for all of its people. I think it is
    equally important to investigate how this legislation may
    impact on upstream rights and users in the State of Wyoming.
        I know that Mr. Gidner, in his short statement in the
    record, has some objections. I am looking forward to seeing
    what those objections may be. I have a couple of questions to
    try to clarify and see if I can get a better understanding.
        It seems that the land acquired by the Tribe with the aid
    of this loan comes with the water rights for that land. I am
    wondering, how will that affect the upstream users and the
    existing rights on the Big Horn River?
        Mr. Venne. This bill does not affect any water rights. In
    fact, within a couple weeks, we will be presenting our water
    rights settlement. I know Wyoming and Montana are talking about
    the flow of the Big Horn River. But the Tribe was always left
    out of any discussions on the river and how it flows and what
    is stored behind the dam.
        Our water bill will take care of that. It will also satisfy
    the people in Montana.
        Senator Barrasso. I was wondering how the water rights
    which are attached to the land, if those water rights would be
    added to the Tribe's base and would that affect the Crow
    Compact in some way?
        Mr. Venne. No.
        Senator Barrasso. When I look at the document that was
    ratified in Montana in 1999, there is a section that explains
    what happens if the tribes acquire more land. I will read it,
    because I am not exactly sure what it means. It says, ``The
    water right appurtenant to the land acquired shall become part
    of, and not an addition to the tribal water right quantified in
    this compact.'' Please help me out.
        Mr. Venne. As I see it, any person that buys any land on
    the Crow Reservation, they would inherit that water right. But
    the allocations that they are doing under the bill will keep
    ours stable, so it won't go up or go down. It really doesn't
    affect anything that I can see.
        Senator Barrasso. That was just the question, is how does
    this affect the upstream users, which is the folks in Wyoming?
        Mr. Venne. Our water rights settlement, when it is
    presented, and we will give you a copy today of that and what
    we are trying to do in settling that. For you to read it and
    understand it, I think you will agree with me that nobody is
    going to be hurt by this legislation.
        Senator Barrasso. Thank you. Thank you for your answers.
        The Chairman. Senator Cantwell.
        Senator Cantwell. Thank you, Mr. Chairman.
        Chairman Sherwood, it is good to see you here in
    Washington, D.C. I thank you for your continued efforts in this
    area. I wanted to ask you a few questions about the difference
    in this legislation versus past legislation.
        It is my understanding that this legislation is different
    in the way it treats some of the boundaries, and that
    particularly this time we have county commissioners from
    Lincoln and Stevens County and the Eastern Washington Council
    and City of Spokane who are also enthusiastic about this
    legislation. Could you tell me what is different and how this
    has garnered their support?
        Mr. Sherwood. We faced opposition initially from Lincoln
    County. I think a lot of it was misunderstanding. One of the
    things we have done is we worked with the State of Washington,
    we worked with Lincoln County to actually come up with
    agreements on how we would enforce, and actually how we would
    protect the people of the river.
        Right now there is a lot of questioned areas as far as law
    enforcement goes, whose jurisdiction is where. So what we try
    to do is work with the counties to make sure it is a seamless
    lake, it is a recreation area used by people from all over the
    Country. It is an important part of our economic growth. We
    have worked hard to make sure that we work with the surrounding
    communities to provide the best type of service we can to the
    people who utilize Lake Roosevelt.
        Senator Cantwell. Does that include an agreement with the
    Washington Department of Fish and Wildlife?
        Mr. Sherwood. We have an agreement in principle if this
    legislation goes through with the Washington Department of Fish
    and Wildlife.
        Senator Cantwell. Mr. Gidner, I am trying to understand
    your testimony as it relates to the legal claim issue. Congress
    obviously explicitly directed the Department of Interior to
    give just and equitable compensation to those who had been
    impacted. How are you saying that the Spokane Tribe, similar to
    the Colville Tribe, has not been impacted?
        Mr. Gidner. I did not say, Senator, that they had not been
    impacted.
        Senator Cantwell. I am asking you, how are you filling that
    mandate that was a directive of Congress to compensate those
    who were impacted?
        Mr. Gidner. I guess I am not sure about the mandate. I know
    the Federal Power Act directed compensation or revenue sharing
    if a private developer had built a plant. This is the Federal
    Government, so that section did not apply.
        Senator Cantwell. I think legislation enacted in 1940
    directed the Secretary of Interior to determine if just and
    equitable compensation for tribal lands taken as a result of
    the Grand Coulee Dam projects. I think we are talking about a
    situation here where we have given just and equitable
    compensation to one impacted tribe and not to another.
        Mr. Gidner. My understanding is, if that is the case, those
    claims were processed in the Indian Claims Commission and the
    statute of limitations expired and the Spokane Tribe did not
    amend their claim to include these. They settled their pre-
    existing claim. So at this point, there is not a legal claim to
    compensation for that.
        Senator Cantwell. I think that is why we are here today and
    we have legislation, is that this has been an ongoing dispute
    where you have a very direct mandate from Congress to make sure
    that everybody is compensated and you are tying the Spokanes on
    a technical issue. I think the Colvilles actually amended a
    separate claim. I think they were in the same situation, isn't
    that right, Mr. Sherwood?
        Mr. Sherwood. Yes. We settled our claim, it was in 1967. We
    settled our claim. The Colvilles actually didn't settle their
    claim, so they amended their claim in 1975. We had no claim to
    amend. But the statute of limitations actually expired in 1951.
    So both tribes were in the same boat. We settled our claim, the
    Colvilles didn't, so they were actually allowed to amend their
    claim later on.
        Senator Cantwell. So for that technical ability, I still
    say that we have a directive here by Congress that is not being
    met, and that is to give just and equitable compensation. That
    is, in fact, I think the need for this legislation.
        I thank the Chair.
        The Chairman. Thank you.
        Vice Chair Murkowski, did you have any questions?
        Senator Murkowski. Thank you, Mr. Chairman. I don't have
    any specific questions of the panel. I was intending to ask Mr.
    Sherwood for clarification in terms of what is different
    between the legislation as we have it now and what we have seen
    in the past. I appreciate the clarification and I appreciate
    your leadership on this issue and your efforts on behalf of the
    Spokane Tribe.
        Mr. Venne, I appreciate all that you do on behalf of your
    tribe as well, as you attempt to get these issues resolved.
        I am appreciative of you, Mr. Chairman, for holding the
    hearing so that we can resolve, or attempt to resolve through
    legislation, some of these issues that many of these tribes
    have been dealing with for a long time.
        The Chairman. Senator Murkowski, thank you very much.
        These are smaller pieces of legislation for the Committee,
    and yet very large issues for individual tribes, because they
    have been working, in many cases, for years. The issue of
    fractionation is a very significant issue, and the issue of
    just and fair compensation, I would say, is equally
    significant. We on the Committee want to have these hearings
    and begin trying to move some of these bills. It is not that we
    would disregard Mr. Gidner at all. The Interior Department,
    however, has testified previously on many of these issues.
        I just want to say that often the Department's testimony
    is, well, we have not reached conclusions on negotiations. Then
    when you find out how long the negotiation has been going on,
    the answer is years. It is not lost on us, Mr. Sherwood, when
    Senator Barrasso observes that your great-grandfather came to
    the Congress and then your father and now you come to the
    Congress. It describes the difficulty of getting resolution,
    getting things done, getting solutions and answers. I think
    your tribes are asking for tools and opportunities to move
    ahead, solve problems, move ahead, give you opportunity as a
    result.
        We appreciate very much the two tribes that have testified
    on the first panel. My understanding is that you do have some
    transportation issues that you are to attend to, some airplanes
    to catch. So, we will release you. If you do have time to stay,
    you are welcome to do so.
        We will invite the other witnesses to come forward. We will
    hear from them and then we will question Mr. Gidner. We
    appreciate both of you very much for appearing before the
    Committee today.
        We will call the second panel forward. Mr. Gidner will
    remain.
        The second panel is the Honorable Mark Macarro. He is the
    Tribal Chairman of the Pechanga Band of Luiseno Mission Indians
    in California. The Honorable Aaron Payment, Chairman of the
    Sault Ste. Marie Tribe of Chippewa Indians in Michigan. The
    Honorable Benjamin Nuvamsa, Chairman of the Hopi Tribe in
    Arizona. And Mr. Raymond Maxx, Navajo Nation Council Delegate
    and Chairman of the Navajo Hopi Land Commission, Navajo Nation
    Council at Window Rock, Arizona.
        We appreciate very much all of you coming to the Congress
    and to the Indian Affairs Committee. You have heard that we
    would ask you to summarize your statements. Your entire
    statements that each of you provided us will be made a part of
    the permanent record of this Committee.
        Let me ask Mr. Mark Macarro, Tribal Chairman of the
    Pechanga Band of Luiseno Mission Indians in California, to
    proceed.

    STATEMENT OF HON. MARK MACARRO, TRIBAL CHAIRMAN, PECHANGA BAND
                       OF LUISENO MISSION INDIANS

        Mr. Macarro. Chairman Dorgan, Vice Chair Murkowski, Senator
    Barrasso, Senator Tester and Senator Cantwell, my name is Mark
    Macarro, I am the Tribal Chairman for the Pechanga Band of
    Luiseno Mission Indians in Temecula, California. We are in
    Southern California about 60 miles north of San Diego County.
        Our aboriginal land territory used to encompass from where
    Temecula is today an area 30 miles to the north, 30 miles to
    the south and about 45 miles east to west, out to the ocean to
    the west and into the mountains to the east. Today we have
    5,500 acres.
        The Pechanga Band of Luiseno Mission Indians is
    respectfully asking your support of H.R. 2963, the Pechanga
    Mission Indian Lands Transfer Act of 2007. If passed into law,
    this bill would protect approximately 1,178 acres of land in
    Riverside County adjacent to our existing reservation by
    transferring it into trust for the benefit of the Tribe.
        It is because of our history and cultural affiliation with
    these lands that the passage of H.R. 2963 is so important to
    the Tribe. Our identity and existence as Luiseno people is
    dependent upon the connection, maintaining the connection and
    protection of these ancestral lands. Today, our tribal
    government operations, such as our environmental monitoring and
    our natural resources management programs exist to fully honor
    and to protect the land and our culture that exist on it.
        In particular, we are concerned about also watershed and
    wellhead protection and groundwater resources, and the
    availability of water for our community. The land that would be
    placed under trust in H.R. 2963 is part of the recharge area
    for some of these resources, and would help protect the quality
    and ensure an adequate supply of water for the Tribe and
    surrounding communities.
        These lands are also unique and important in terms of the
    cultural resources that they encompass. They include
    pictographs and petroglyphs that are unique not only to Luiseno
    Country but I think to all Indian Country. While these lands
    have a unique historical and cultural value for the Pechanga
    people, they are also important for the broader aesthetic, the
    visual aesthetic value to the communities throughout the
    Temecula Valley.
        The Tribe is very proud of our protection of cultural
    resources on our tribal properties and throughout our ancestral
    lands, which we no longer own. The Tribe is proud that we have
    preserved and protected these cultural places on lands in a
    culturally appropriate manner. More appropriately, we are proud
    that we have given these resources a level of protection that
    they would not have received had they been subjected to outside
    standards. I think even under the best of circumstances, many
    of these standards simply mitigate destruction rather than
    protect.
        So the Tribe is ever vigilant to protect our cultural
    resources, since we now own only a tiny fraction of the lands
    that once belonged to us, and because most of these resources
    have already been lost to development off the reservation in
    non-tribal jurisdictions.
        As stewards of our traditional tribal lands, the Tribe will
    continue to ensure responsible management of the lands upon
    transfer. For example, although the lands in question will not
    be subject to the Riverside County multi-species habitat
    conservation plan, the MSHCP, once they have been transferred
    to the Tribe, the Tribe has agreed in its MOU with the Fish and
    Wildlife Service to manage the land in a manner consistent with
    the goals of the locally-derived MSHCP. Protecting the sanctity
    of these lands through our conservation and resource management
    is the highest priority for the Tribe. Our mandate is to
    protect and enhance the sustainability and well-being of the
    Pechanga way of life. Accordingly, the tribal government issued
    an executive order, which has zoned the land to be transferred
    under H.R. 2963 for conservation and management of wildlife and
    cultural values. Such zoning would make any commercial or other
    significant development of the lands contrary to tribal law.
        Recognizing the importance of these lands to the Pechanga
    people, the Tribe began in 1990 working the administrative
    process with the BLM. It was a local scoping hearing that BLM
    conducted, beginning in 1990, for this parcel which it had
    targeted at that time for disposal. The parcels come on and off
    that disposal list. But administratively, we have been working
    for about 18 years through that process.
        During the 108th Congress, well, actually in 2004 it was
    Congressman Darrell Issa who was approached by the BLM out of
    interest to see if he could carry a bill that would transfer
    the land to us. They knew at the time that we were interested
    in obtaining and managing that land. They were looking to help
    release some of the management burden. There were dozens upon
    dozens of disparate parcels of land in Southern California that
    has its management challenge for the BLM. So it appeared to be
    a win-win for everybody.
        During the 108th Congress, H.R. 4908, a bill which was
    substantially similar to H.R. 2963, was introduced to the
    House, and H.R. 4908 was not passed by the House due to
    concerns expressed by San Diego County late in the process.
    During the 109th Congress, the Pechanga Band made extensive
    efforts to work with all affected parties to iron out any
    concerns or miscommunications regarding the provisions of H.R.
    3507, which also passed out of the House of Representatives.
        We resolved all concerns expressed by parties of which we
    were aware, which included concerns raised by the counties of
    Riverside and San Diego. Also during the 109th Congress, it was
    discovered that a power line runs across the southwest corner
    of the BLM parcel. The BLM and the owner of the power line,
    Semper Energy, have agreed to language that addresses the
    identification and disposition of 12.82 acres that encompasses
    the power line.
        In the 110th Congress, the BLM remains supportive of this
    trust transfer, which is now embodied in H.R. 2963.
        In closing, I would like to thank you for the opportunity
    to address you. On behalf of the Pechanga Band of Luiseno
    Indians, I respectfully request that you support H.R. 2963.
    Thank you for your time.
        [The prepared statement of Mr. Macarro follows:]

    Prepared Statement of Hon. Mark Macarro, Tribal Chairman, Pechanga Band
                           of Luiseno Mission Indians
        Good morning Chairman Dorgan and Vice-Chairperson Murkowski. Thank
    you for the opportunity to provide testimony on behalf of the Pechanga
    Band of Luiseno Mission Indians.
        The Pechanga Band of Luiseno Indians respectfully requests your
    support of H.R. 2963, the Pechanga Band of Luiseno Mission Indians Land
    Transfer Act of 2007. If passed into law, this bill would protect
    approximately 1178 acres of land in Riverside County, California,
    adjacent to our existing reservation, and important to the Luiseno
    people, by transferring it into trust for the benefit of the Tribe.
        The Tribe has called the Temecula Valley home for more than 10,000
    years and 10,000 years from now, tribal elders will share with tribal
    youth, as they do today, the story of the Tribe's creation in this
    place. Since time immemorial, through periods of plenty, scarcity and
    adversity, the Pechanga people have governed ourselves and cared for
    our lands. This land is witness to our story.
        The history of the Tribe begins with our ancestral home village of
    Temeeku, which was a center for all the Payomkawichum, or Luiseno
    people. After the establishment of the state of California in 1850, a
    group of Temecula Valley Ranchers petitioned the District Court in San
    Francisco for a Decree of Ejection of Indians living on the land in
    Temecula Valley, which the court granted in 1873.
        In 1875 the sheriff of San Diego County began three days of
    evictions. The Luiseno people were taken into the hills south of the
    Temecula River. Being strong of spirit, most of our dispossessed
    ancestors moved upstream to a small, secluded valley, where they built
    new homes and re-established their lives.
        A spring located two miles upstream in a canyon provided them with
    water. We have always called this spring Pechaa'a, which comes from
    pechaq, which means to drip. This spring is the namesake for
    Pechaa'anga or Pechaanga, which means ``at Pechaa'a'' or ``at the place
    where water drips.''
        On June 27, 1882, seven years after being evicted, the President of
    the United States issued an Executive Order establishing the Pechanga
    Indian Reservation. Several subsequent trust acquisitions were made in
    1893, 1907, 1931, 1971 and 1988, each one increasing the size of the
    reservation.
        At present, the total land area of the Pechanga reservation is
    approximately 5,500 acres. As a people of this ancestral land that
    spreads from the center of Temecula out 60 miles north and south and
    approximately 45 miles east to west, we have always been respectful of
    and responsible for the environmental, social and economic
    relationships that exist upon it.
        It is because of our history and cultural affiliation with these
    lands that the passage of H.R. 2963 is so important to the Tribe. Our
    identity and existence as Luiseno people is dependent upon our
    connection to and protection of these ancestral lands.
        Today, our tribal government operations, such as our environmental
    monitoring and natural resource management programs, exist to fully
    honor and protect the land and our culture upon it. In particular, we
    are concerned about watershed and wellhead protection for our surface
    and ground water resources and the availability of water for our
    community. The land that would be placed into trust under H.R. 2963 is
    part of the recharge area for some of these resources and would help
    protect the quality and ensure an adequate supply of water for the
    Tribe and surrounding communities.
        These lands are also home to important cultural resources,
    including pictographs and petroglyphs unique, not only to Luiseno
    territory, but to all of Indian country and our Nation. While these
    lands have a unique historical and cultural value for the Pechanga
    people, they are also important for their broader aesthetic value to
    communities throughout the Temecula Valley. The Tribe is very proud of
    our protection of cultural resources on our tribal properties and
    throughout our ancestral lands. Our Cultural Committee has a well-
    deserved reputation for thoroughness and strictness in its demands for
    protection of cultural resources. The Tribe is also very proud that we
    have preserved and protected all of our cultural places on tribal lands
    in a culturally appropriate manner. More importantly, we are proud that
    we have given these resources a level of protection they would not
    receive if they were located outside of the reservation boundaries,
    even in the best of circumstances. The Tribe is ever vigilant to
    protect our cultural resources since we now own only a tiny fraction of
    the lands that once belonged to us and because most of these resources
    have already been lost to development in non-tribal jurisdictions.
        As stewards of our traditional lands, the Tribe will continue to
    ensure responsible management of the lands to be transferred. For
    example, although the lands in question will not be subject to the
    Riverside County Multi Species Habitat Conservation Plan (MSHCP) once
    they have been transferred to the Tribe, the Tribe has agreed in its
    MOU with Fish & Wildlife to manage the land in a manner consistent with
    the goals of the MSHCP. In fact, when questions came up about the
    Tribe's development of a golf course on a portion of similar tribal
    lands, the Tribe commissioned a MSHCP consistency analysis by a County
    approved MSHCP consultant which concluded that the Tribe's treatment of
    the property in question is consistent with meeting and/or exceeding
    the MSHCP goals for development within that geographical area.
        Although we have always believed in the sanctity of our lands, and
    have planned carefully for the use and preservation of our land, one
    environmental group has recently questioned our adherence to the
    National Environmental Policy Act and our development efforts on the
    reservation.
        After conversations with the representative of this group, we found
    their objections to be unwarranted, insulting and disturbing. The
    criticism is aimed specifically at a parcel, known as the Great Oak
    Ranch parcel, which was transferred to the Tribe through the
    administrative fee-to-trust process. In 2002, the Tribe succeeded in
    preventing a major power line from being situated on this parcel, the
    Great Oak Ranch. The Tribe, along with the surrounding community
    averted an environmental impact which would have left a lasting imprint
    on the lands of the Pechanga people and the Temecula Valley.
        We assure you the Tribe has devoted significant tribal resources
    ensuring the use of our lands adheres to the principles of the National
    Environmental Policy Act, the MSHCP and California environmental laws.
    We have long-standing cooperative and supportive relationships with our
    local environmental groups and our local governments, and have made
    every effort to coordinate our planning and gain their support for
    Tribal projects which affect the community.
        Protecting the sanctity of these lands through conservation and
    resource management is of the highest priority for the Tribe. Our
    mandate is to protect and enhance the sustainability and well being of
    the Pechanga way of life. Accordingly, the tribal government also
    issued an Executive Order zoning the land to be transferred under H.R.
    2963 for conservation and management of wildlife and cultural values.
    Such zoning would make any commercial or other significant development
    of the lands contrary to tribal law.
        Recognizing the importance of these lands to the Pechanga people,
    the Tribe began working with the Bureau of Land Management (BLM) nearly
    15 years ago to place these lands into trust. In the spring of 2004,
    the BLM indicated to Congressman Darrell Issa (R-CA) their willingness
    to transfer the land. In response to the BLM, Congressman Issa
    introduced legislation to transfer the land to the Tribe.
        During the 108th Congress, H.R. 4908, a bill which was
    substantially similar to H.R. 2963, was introduced in the House of
    Representatives. H.R. 4908 was not passed by the House due to concerns
    expressed by San Diego County late in the process.
        During the 109th Congress, the Pechanga Band of Luiseno Indians
    made extensive efforts to work with all affected parties to iron out
    any concerns or miscommunication regarding the provisions of H.R. 3507,
    which also passed out of the House of Representatives. We resolved all
    concerns expressed by parties of which we were aware, including
    concerns raised by Riverside and San Diego Counties. Concerns regarding
    management of the lands expressed by the U.S. Fish and Wildlife Service
    were resolved through language in the legislation regarding the
    management of and purposes for which the transferred land may be used
    and through the execution of a formal Memorandum of Understanding,
    signed by the Bureau of Land Management, the Fish and Wildlife Service
    and the Pechanga Band of Luiseno Indians.
        Also during the 109th Congress, it was discovered that a power line
    runs across the southwest corner of the parcel. The BLM and the owner
    of the power line, Sempra Energy, have agreed to language that
    addresses the identification and disposition of the 12.82 acres that
    encompasses the power line. That language has been incorporated into
    the current bill in front of you today, H.R. 2963.
        In the 110th Congress, the Bureau of Land Management remains
    supportive of this trust transfer, now embodied in H.R. 2963. We have
    also received the support of the City of Temecula, which is adjacent to
    the property, in the form of a resolution passed by the City Council.
        In closing, I thank you for the opportunity to address you, and, on
    behalf of the Pechanga Band of Luiseno Mission Indians, I respectfully
    request your support for H.R. 2963. Thank you for your time and
    consideration of this matter.

        The Chairman. Mr. Chairman, thank you very much. You too
    have a history of appearing before our Committee. We appreciate
    very much your being here.
        We will hear now from the Honorable Aaron Payment, who is
    the Chairman of the Sault Ste. Marie Tribe of Chippewa Indians
    in Michigan.

    STATEMENT OF HON. AARON PAYMENT, CHAIRPERSON, SAULT STE. MARIE
                       TRIBE OF CHIPPEWA INDIANS

        Mr. Payment. Good morning. My name is Aaron Payment. I am
    the democratically-elected chairperson of my Tribe, the Sault
    Ste. Marie Tribe of Chippewa Indians.
        I would like to thank the Committee for the opportunity to
    present my testimony on H.R. 2120. This bill is important to my
    Tribe, because as I see it, it is simply an effort to correct a
    failure on behalf of the BIA to properly exercise its trust
    responsibility to my Tribe.
        My Tribe is the largest east of the Mississippi, with
    38,000 members. We were recognized in 1972 after a 20-year
    struggle. The Treaty of Washington in 1936 recognized my
    Tribe's aboriginal territory, which is where we have resided
    since time immemorial and where we continue to reside.
        Our service area includes the seven eastern counties in the
    Upper Peninsula of Michigan. About 12,000 of our members reside
    in our service area, with 64 percent of our members residing
    outside of our service area. Since receiving recognition in
    1972, my Tribe has engaged in the arduous task of re-acquiring
    land in our original territory to meet the needs of our
    members.
        The present-day trust land of my Tribe is just over 1,000
    acres. Again, that is 1,000 acres. Earlier today you had
    testimony on the volume of acres, we have just 1,000 acres.
    Five hundred sixty-seven acres are located in six separate
    sites within our treaty territory. All of these lands are held
    in trust by the United States for the benefit of my Tribe and
    are recognized as Indian Country subject to tribal and Federal
    jurisdiction.
        On these lands, we operate our tribal government and
    administrative programs, housing, health, social services and
    law enforcement and tribal businesses. Of the 1,600 acres that
    are held in trust, only 125, or a mere 8 percent, have been
    formally proclaimed as a reservation.
        H.R. 2120 concerns one piece of land, approximately 65
    acres, just south of St. Ignace, Michigan, that my Tribe
    purchased in 1982. In 1983, we requested that the United States
    proclaim this land Indian land under the Indian Reorganization
    Act. The United States took this land into trust in 1983 but
    never proclaimed it a reservation, despite the fact that my
    Tribe twice requested that it be proclaimed a reservation. H.R.
    2120 would correct this egregious oversight.
        In May, 1988, my Tribe opened the Kewadin Shores Casino on
    the 1983 parcel we acquired. Because we did not have a great
    deal of resources at the time, we chose to open our Kewadin
    Shores Casino in an existing building. Over time, we have added
    on to that structure. However, this casino became an unwieldy
    hodge-podge of add-ons. The old facility posed significant
    health hazards for our 406 employees, because we have low
    ceilings and poor circulation and also and also health hazards
    due to cigarette smoke.
        Given the limitations of this facility, we decided to build
    a new facility. Looking at our land holdings, we determined
    that it was not in our best interest to build on the same land
    as our existing facility. Building the gaming space, lobby,
    hotel space on the 1983 parcel would have meant that we would
    have had to dislocate several tribal families and other
    governmental programs on the small parcels of land that we do
    have. Additionally, building on the same location would mean
    significant loss in revenue during the construction.
        The new building was instead built partially on the 1983
    parcel and partially on a piece of land contiguous to the 1983
    parcel, which my Tribe acquired and placed into trust in 2000.
    The Indian Gaming Regulatory Act provides the land taken into
    trust prior to October 17, 1988 is eligible for gaming if such
    lands are located within or contiguous to the boundaries of the
    reservation, on October 17, 1988. The 1983 parcel, while not
    officially proclaimed a reservation, has always been treated as
    a reservation by both my Tribe and the United States. These
    lands were set aside by the United States for the use and
    benefit of my Tribe. Our people live, work and receive services
    on these lands. These lands are under civil and criminal
    jurisdiction of the United States and my Tribe. To my
    knowledge, there is no other criteria under Federal law that
    distinguishes the difference between trust and reservation
    status.
        The inability to use our land as we believe it should be
    used is entirely due to the inaction of the United States. My
    Tribe requested on at least two occasions, in 1986 and April
    1988, both prior to the enactment of IGRA, that the United
    States proclaim the 1983 parcel a reservation. Prior to the
    enactment of IGRA, the United States got so far as to inform
    the local governments that a reservation proclamation was
    impending. Again, prior to IGRA, the United States acknowledged
    that a reservation request was impending.
        As we understand it, only the ministerial act of publishing
    the notice in the Federal Register was not done. In a
    supportive document from Terry Virden, BIA Regional Director in
    Minneapolis, the BIA acknowledges that my Tribe complied with
    all the applicable procedures prior to the enactment of IGRA,
    and that administrative oversight is likely to blame.
        H.R. 2120 would do what the United States said it was going
    to do in 1988. My Tribe has made a significant investment of
    over $41 million to build our new casino to provide a safe and
    healthy environment for our 406 employees and customers, so
    that we can continue to be the economic engine in our area of
    the State. We did this on land that is in trust and is
    contiguous to land that is in trust since 1983.
        The new replacement casino would not increase gaming and
    would not add to the number of casinos now operating in
    Michigan. However, according to the Department of Interior, the
    only way that the Tribe can operate on this land without
    negotiating with the State is through this legislation. We have
    the support of the BIA and all local governments, and also the
    Little Traverse Bay Band, our brother and sister tribe that is
    near us, for this legislation. We would urge expedited
    consideration of this legislation, so that we can finally use
    our building for what it was intended.
        Again, I would like to thank the Committee for its time and
    attention to this matter, and now I would be happy to answer
    any questions you might have of me.
        [The prepared statement of Mr. Payment follows:]

    Prepared Statement of Hon. Aaron Payment, Chairperson, Sault Ste. Marie
                           Tribe of Chippewa Indians
        My name is Aaron Payment, I am the Chairperson of the Sault Ste.
    Marie Tribe of Chippewa Indians (Sault Tribe). I would like to thank
    the Committee for the opportunity to present this testimony on H.R.
    2120. I would also like to thank the Michigan delegation for supporting
    this legislation.
        This bill is important to my Tribe because as I see it, it is
    simply an effort to correct a failure of the federal government to
    properly exercise its trust responsibility to my Tribe. Importantly,
    the Federal District Court in Michigan agrees with us and has enjoined
    the United States from enforcing its decision that the land in question
    is not a Reservation under federal law. Sault Ste. Marie Tribe of
    Chippewa Indians v. United States of America, 2:06-cv-276 (Western
    District, MI) (2007). I attach a copy of this decision for the record.
    Equally as significant the Department of the Interior has testified in
    support of this legislation.
        The Sault Tribe reestablished its relationship with the Federal
    Government in 1972 after twenty long years of seeking federal
    recognition. The Treaty of March 28, 1836, 7 Stat. 491, with the
    Chippewa and the Ottawa Bands of Northern Michigan, recognized my
    Tribe's aboriginal territory. Now, our service area includes Chippewa,
    Mackinac, Luce, Schoolcraft, Alger, Marquette and Delta Counties. We
    are a descendancy Tribe with the number of enrolled members now
    approaching 33,000. Approximately 12,000 reside in the service area.
    Since receiving recognition in 1972, my Tribe has engaged in a
    systematic process to reacquire land in the Upper Peninsula of Michigan
    within our service area to meet the needs of our members who live in
    our traditional territory.
        The present day trust land of my Tribe is just over a thousand
    acres located in the City of Sault Ste. Marie and approximately 567
    acres located in six separate sites within our treaty territory at
    Manistique, Wetmore, St. Ignace, Hessel, Marquette and Escanaba,
    Michigan. All of these lands are held in trust by the United States for
    the benefit of my Tribe and are recognized as ``Indian Country''
    subject to tribal and federal jurisdiction pursuant to the 18 U.S.C.
    Sec. 1151.
        On these lands, we operate our tribal government and administrative
    programs, housing programs, health programs, social service programs,
    law enforcement, and tribal businesses. Of the 1,600 acres held in
    federal trust, only 124.8 acres have been formally proclaimed as
    reservation. That is less than 8 percent. As is the case with many
    tribes recognized in the last thirty years, we are a land poor tribe
    when you consider the number of members per acre. Only 500 of our
    33,000 members (or about 1.5 percent) reside on our reservation. Only 4
    percent of those who reside in our service area (500/12,000) are able
    to reside on the reservation given our limited land base.
        H.R. 2120 concerns one piece of land (approximately 65 acres) that
    the Tribe purchased in St. Ignace, Michigan. In 1983, we requested that
    the United States take into trust and proclaim this land as a
    reservation under the Indian Reorganization Act of 1924, 25 U.S.C.
    Sec. Sec. 465, 467 (``1983 Parcel''). The United States took this land
    into trust in 1983 but never proclaimed it a reservation. This is so
    despite the fact that the Tribe twice requested that it be proclaimed a
    reservation. H.R. 2120 would correct this egregious oversight.
        In 1986, we opened the Kewadin Shores Casino on the 1983 Parcel.
    Because we did not have a great deal of resources at this time, we
    elected to open the Kewadin Shores Casino in an existing building.
    After the enactment of the Indian Gaming Regulatory Act, my Tribe
    entered into a compact with the State of Michigan in 1993. Over time we
    added to the existing structure. However, this casino became an
    unwieldy conglomeration of add-ons. This type of facility composition
    posed significant health hazards to our 406 employees, because there
    was poor air circulation and ventilation due to cigarette smoke and
    concentrated population. There were also serious sewage problems with
    this facility and its location. Finally, the internal maze like flow
    within the building was not good for our customers and the outside
    appearance was equally unappealing.
        Given the limitations of this facility, we decided to build a new
    building. In looking at our land holdings, the Board determined that it
    was not in the Tribe's best interest to build on the same spot as the
    old facility because building the gaming space, lobby and hotel space
    on the 1983 parcel would mean having to dislocate several tribal
    families and other governmental programs from the land. Additionally,
    building on the same location would mean losing revenue during
    construction. The casino was instead built on a piece of land
    immediately adjacent to the old casino, which the Tribe acquired in
    trust in 2000 (``2000 Parcel'').
        As I understand it, the previous Administration believed that the
    Tribe could do gaming on the 2000 Parcel, because a provision in the
    Indian Gaming Regulatory Act that states that land taken into trust
    after October 17, 1988 are eligible for gaming if ``such lands are
    located within or contiguous to the boundaries of the reservation of
    the Indian Tribe on October 17, 1988.'' 25 U.S.C. Sec. 2719(a)(1).
        I am advised that under the Supreme Court precedent, the 1983
    Parcel is a reservation. The Supreme Court has held that ``the
    principal test'' for determining whether Indian land constitutes a
    reservation is ``whether the land in question `ha[s] been validly set
    apart for the use of the Indians as such, under the superintendence of
    the government.' '' United States v. John, 437 U.S. 634, 648-49
    (quoting United States v. Pelican, 232 U.S. 442, 449 (1914)). In
    another case, the Court has said no ``precedent of this Court has ever
    drawn the distinction between tribal trust land and reservations and
    that the dispositive question was whether the ``area has been `validly
    set apart for the use of the Indians as such, under the superintendence
    of the Government.' '' Oklahoma Tax Commission v. Citizen Band
    Potawatomi Indian Tribe of Oklahoma, 498 U.S. 505, 511 (1991) (quoting
    John). The 1983 Parcel is clearly land set aside for the use of Indians
    and has been under the superintendence and jurisdiction of the United
    States since 1983.
        In 2003 the Tribe asked the Department of the Interior to concur
    with this view. In February of 2006, we finally received an opinion
    from the Interior Solicitor's Office stating that notwithstanding the
    fact that the 1983 Parcel was set aside for the Tribe and is under the
    jurisdiction of the United States, because the United States had never
    proclaimed it a reservation, it did not meet the definition of a
    reservation under federal law. Accordingly, the Acting Associate
    Solicitor determined that the 2000 Parcel was not land contiguous to a
    Reservation under IGRA.
        By this time, we were close to finishing our new building, which
    was to be a new hotel and casino with a state-of-the art air filtration
    system. We held numerous meetings with Interior officials to urge them
    to correct their decision and rectify a problem that was created by the
    government's own inaction. This was to no avail. The NIGC warned us
    that if we operated in the new building, they would issue a closure
    order.
        However, because the old facility was so unsafe, we elected to
    invest $3 million and put the Kewadin Shores Casino in a temporary
    building (or sprung structure), which was entirely on the 1983 Parcel,
    but is adjacent to the new casino building on the 2000 Parcel. While
    operating in the interim facility, the Tribe brought suit against the
    United States, challenging Interior's determination that the 1983
    Parcel was not a Reservation.
        In August of 2007, the Federal District Court for the Western
    District of Michigan granted the Tribe a preliminary injunction against
    the United States and permitted the Tribe to open in the new facility.
    The Court's basis for its preliminary ruling rested on a number of
    factors one of them being the high likelihood that the Tribe would
    prevail on the merits that the 1983 Parcel is a Reservation under
    federal law. The other factor was the negative impact on the Tribe if
    it could not operate in the new facility. We are now operating in the
    new facility.
        We are currently still in Federal Court. The briefing on the merits
    on this case is now complete. We are hopeful for a positive outcome. I
    know the question for the Committee is why do we need the legislation
    if we are hopeful about our litigation?
        First, there is no guarantee in any litigation. Second, this
    litigation is very costly for the Tribe. Even if we win at the District
    Court level, there will be an appeal. This legislation moots the need
    for this costly litigation and will make things as they should have
    been when the Tribe asked that this land to be proclaimed a Reservation
    more than a decade ago.
        Finally resolving this matter without further litigation is vital
    to us. My Tribe spends 97 percent of our net revenue on membership
    services to make up for the shortfall of federal funding. The loss of
    income that could result if we are forced to close the new facility and
    reopen in another structure will likely result in a cut in membership
    services.
        Moreover, tribal members and non-Indians alike in the local
    community could lose their jobs at the Kewadin Shores Casino. Forty
    five percent of all our casino employees are non-Tribal. Approximately
    $13.5 million of our $30 million payroll supports jobs for those who
    are not Tribal members, which underscores that this not simply an
    Indian problem. Jobs we provide afford great benefits, like retirement
    and health care. Jobs for which individuals pay taxes and re-circulate
    excess income in an already stagnating economy. We currently employ
    about 20 percent of the adult workforce of the local city of St.
    Ignace--a tourism town. Job losses will result in additional burdens on
    the Tribe's and State's social services as those who lose their jobs
    will turn to Tribal and State support programs.
        The inability to use our land as we believe it should be used is
    entirely the fault of the United States. The Tribe requested two
    different times (1986 and April, 1988--both prior to the enactment of
    IGRA in October 1988) that the United States proclaim the 1983 Parcel a
    reservation. In 1988, the United States got so far as to inform the
    local governments that a reservation proclamation was ``impending.'' As
    we understand it, only the ministerial act of publishing the notice in
    the Federal Register was not done.
        In a supportive document from Terry Virden, BIA Regional Director
    in Minneapolis, the BIA acknowledges that the Tribe complied with all
    applicable procedures prior to the enactment of IGRA in October of 1988
    and that an administration oversight is likely to blame. Why this land
    was not proclaimed a reservation, we do not know, but we do not believe
    that the Tribe or the people of the Upper Peninsula should have to pay
    for this failure.
        H.R. 2120 would do what the United States said it was going to do
    in 1988 and what it should have done in 1983 or even 1986. My Tribe has
    made a significant investment of $41 million to build this new casino
    to provide a safe and healthy place for our 406 employees and customers
    and to continue to be the economic engine of this area of the State. We
    did this on land that is held in trust and is contiguous to land that
    has been in trust since 1983. The new replacement casino does not
    increase gaming. Nor does it add to the number of casinos now operating
    in Michigan. However, according to the Department of the Interior, the
    only way that the Tribe can operate a casino on this land--without
    negotiating with the state--is this legislation. We have the support of
    the city, township and county governments, and the neighboring tribe of
    just thirty miles-the Little Traverse Bay Band of Odawa Indians-for
    this legislation.
        Again, I would like to thank the Committee for its time and
    attention to this matter.
    Attachments

        The Chairman. Mr. Chairman, thank you very much for being
    with us today.
        Next we will hear from the Honorable Benjamin Nuvamsa,
    Chairman of the Hopi Tribe in Arizona. I regret that we do not
    have a name tag in front of you, but welcome to the Committee,
    and you may proceed, Mr. Chairman.

      STATEMENT OF HON. BENJAMIN H. NUVAMSA, CHAIRMAN, HOPI TRIBE

        Mr. Nuvamsa. [Greeting in native tongue.] Good morning,
    Chairman Dorgan, members of the Senate Committee on Indian
    Affairs.
        The Hopi Indian Tribe appreciates the opportunity to
    provide testimony on S. 531, the Repeal of the Bennett Freeze.
    My name is Benjamin Nuvamsa, and I am Chairman of the Hopi
    Tribe.
        Before I begin, I would like to thank Senator McCain for
    introducing this legislation and for his ongoing leadership on
    this very important matter. The Hopi Tribe supports the
    Committee's efforts through S. 531 to end the Bennett Freeze
    and thereby assist the Hopi and Navajo people in resolving the
    longstanding dispute between our people over lands of the 1934
    Act reservation.
        This repeal of the Bennett Freeze will close a long,
    contentious period in the history of our tribes. We can now
    move forward into what I hope will be a new era of cooperation
    between the Hopi and Navajo, which is vital to both tribes. For
    more than 100 years, the Hopi Tribe has worked to prevent the
    loss of its lands through the much-larger Navajo Nation and to
    preserve the rights of the Hopi to control its lands against
    intrusion.
        Beginning in 1958, the United States Congress enacted a
    series of laws intended to lead to a final resolution of the
    disputes between the Hopi and Navajo of the 1882 Hopi
    Reservation. The Navajo-Hopi Land Settlement Act of 1974
    authorized litigation between the Hopi and the Navajo to
    determine the tribes' respective rights in both the 1882 and
    the 1934 Act Reservation.
        Incidentally, I wanted to make a point here that also my
    grandfather, Peter Nuvamsa, Sr., was our first chairman of the
    Hopi Tribe and he worked on this issue back in his day.
        In November 2006, Secretary of the Interior Dirk Kempthorne
    approved an intergovernmental compact between the Hopi Tribe
    and the Navajo Nation, ending more than 40 years of litigation
    between our tribes over lands within the 1934 Act Navajo
    Reservation. In December, 2006, the United States District
    Court for Arizona approved this compact.
        The agreement between our tribes accomplishes several
    important objectives. First, it ends the long, contentious and
    expensive litigation between the Hopi and Navajo over the lands
    of our respective reservations. Secondly, it grants to the
    members of both tribes certain religious access and use rights
    on the lands of the other.
        Thirdly, the agreement secures to the Hopi religious
    practitioners the right to gather eagles on parts of the Navajo
    Reservation. And finally, this agreement ends the development
    moratorium imposed under the Bennett Freeze. All that remains
    is for Congress to amend the 1974 Act to repeat that section of
    the Act that codified the freeze.
        Passage of S. 531 will symbolize the close of a long and
    difficult period in the history of our tribes, and will set the
    stage for a new period of optimism for the Hopi and the Navajo
    people in the area, one which will allow Hopis and Navajos to
    pursue economic and resource development initiatives rather
    than litigation.
        In our cooperation, we hope to improve the quality of life
    enjoyed by our people, while allowing access to and regular use
    of sacred sites and shrines on our respective lands. We hope
    that passage of S. 531 will lay the foundation for cooperation
    not only between the Hopi and the Navajo, but also between the
    two tribes and the United States; a foundation that will
    support our joint efforts to develop the lands and resources
    and the economies of our two tribes into the sustainable
    homelands that the tribes and the United States intended them
    to be.
        Chairman Dorgan, let me thank you and the members of this
    Committee for the opportunity on behalf of the Hopi Tribe to
    testify concerning S. 531. We look forward to working with the
    Committee to resolve any issues raised by this legislation and
    moving it closer to passage.
        I am happy to answer any questions that you may have. Thank
    you very much.
        [The prepared statement of Mr. Nuvamsa follows:]

      Prepared Statement of Hon. Benjamin H. Nuvamsa, Chairman, Hopi Tribe
        Good morning, Chairman Dorgan, members of the Senate Committee on
    Indian Affairs.
        The Hopi Indian Tribe appreciates the opportunity to provide
    testimony on S. 531, the Repeal of the Bennett Freeze. My name is
    Benjamin Nuvamsa, and I am Chairman of the Hopi Tribe.
        Before I begin, I would like to thank Senator McCain for
    introducing this legislation and for his ongoing leadership on this
    very important matter.
        The Hopi Tribe supports the Committee's effort through S. 531 to
    end the Bennett Freeze and thereby assist the Hopi and Navajo people in
    resolving the long-standing dispute between our people over the lands
    of the 1934 Act Reservation. Congress' repeal of the Bennett Freeze
    will close a long contentious period in the history of our tribes. We
    can now move forward into what I hope will be a new era of cooperation
    between the Hopi and Navajo, on issues vital to both tribes. For more
    than 100 years, the Hopi Tribe has worked to prevent the loss of its
    lands through the much-larger Navajo Nation and to preserve the rights
    of Hopi to control its lands against intrusion.
        Beginning in 1958, the United States Congress enacted a series of
    laws intended to lead to a final resolution of the disputes between the
    Hopi and Navajo of the 1882 Hopi Reservation. The Navajo-Hopi Land
    Settlement Act of 1974 authorized litigation between the Hopi and the
    Navajo to determine the tribes' respective rights in both the 1882 and
    the 1934 Act Reservation.
        Incidentally, I wanted to make a point here that also my
    grandfather, Peter Nuvamsa, Sr., was our first chairman of the Hopi
    Tribe and he worked on this issue back in his day.
        In November 2006, Secretary of Interior Dirk Kempthorne approved an
    Intergovernmental Compact between the Hopi Tribe and the Navajo Nation,
    ending more than 40 years of litigation between our tribes over lands
    within the 1934 Act Navajo Reservation. In December 2006, the United
    States District Court for Arizona approved the Compact.
        This agreement between our tribes accomplishes several important
    objectives. First, it ends the long, contentious and expensive
    litigation between the Hopi and Navajo over the lands of our respective
    reservations. Secondly, it grants to the members of both tribes certain
    religious access and use rights on the lands of the other. Thirdly, the
    agreement secures to Hopi religious practitioners the right to gather
    eagles on parts of the Navajo Reservation. And finally, this agreement
    ends the development moratorium imposed by the Bennett Freeze. All that
    remains is for Congress to amend the 1974 Act to repeal that section of
    the Act that codified the freeze.
        Passage of S. 531 will symbolize the close of a long and difficult
    period in the history of our tribes and will set the stage for a new
    period of optimism for Hopi and Navajo people in the area, one which
    allows Hopi and Navajo to pursue economic and resource development
    initiatives rather than litigation.
        In our cooperation, we hope to improve the quality of life enjoyed
    by our people, while allowing access to and regular use of sacred sites
    and shrines on our respective lands. We hope that passage of S. 531
    will lay a foundation for cooperation not only between the Hopi and
    Navajo, but also between the two tribes and the United States; a
    foundation that will support our joint efforts to develop the lands and
    resources and the economies of our two tribes into the sustainable
    homelands that the tribes and the United States intended them to be.
        Chairman Dorgan, let me thank you and the members of this Committee
    for the opportunity on behalf of the Hopi Tribe to testify concerning
    S. 531. We look forward to working with the Committee to resolve any
    issues raised by this legislation and moving it closer to passage.
        I am happy to answer any questions that the members may have. Thank
    you very much.

        The Chairman. Mr. Chairman, thank you very much.
        Finally, we will hear from Mr. Raymond Maxx, who is the
    Navajo Nation Council Delegate and Chairman of the Navajo-Hopi
    Land Commission, Navajo Nation Council, in Window Rock,
    Arizona. Mr. Maxx, you may proceed.

         STATEMENT OF RAYMOND MAXX, CHAIRMAN, NAVAJO-HOPI LAND
                               COMMISSION

        Mr. Maxx. [Greeting in native tongue.] Thank you, Senator
    Dorgan, for inviting me to come before this body. Senator
    Murkowski, Senator Tester, good morning.
        My name is Raymond Maxx. I am the Chairman of the Navajo-
    Hopi Land Commission, which is the Navajo Nation Council entity
    responsible for overseeing the Bennett Freeze matters. Thank
    you for this opportunity to speak about S. 531, legislation
    that would formally strike from the United States code of
    provisions authorizing the development freeze in the western
    portion of the Navajo Nation.
        On November 3, 2006, the Navajo Nation and the Hopi Tribe
    and Secretary Kempthorne signed an intergovernmental compact in
    Phoenix, settling the litigation over the western portion of
    the Navajo Nation that had been subject to Federal development
    restriction, commonly referred to as the Bennett Freeze. It was
    a wonderful day and signaled a new beginning for all parties.
        Because my family was relocated twice by the Federal
    Government and now lives in a former Bennett Freeze area, I
    have first-hand knowledge of what conditions were like. When we
    located to the Bennett Freeze area in the late 1970s, I don't
    think my parents fully understood that they could not fix their
    home in the Bennett Freeze; that you could not make additions;
    that no Federal, Tribal or State programs could assist your
    community through the building of infrastructure essential to
    the health and well-being of any community. As a result, the
    Bennett Freeze is locked into the poverty of 1966, when the
    freeze was imposed.
        For the families who live in the former freeze area, so
    long as the authority for the freeze remains in the U.S. Code,
    there also remains a fear that it could be reimposed. Passage
    of S. 531 could send a powerful signal that all parties have
    begun the process of moving on from the divisive disputes of
    the past. It could also ensure that there are no ambiguous
    interpretations which would lead to the re-imposition of the
    Bennett Freeze development freeze.
        In addition to passing S. 531, I would encourage the
    Committee to hold field hearings on how the Bennett Freeze area
    can be redeveloped and what level of Federal support should be
    provided.
        Thank you for this opportunity to speak on S. 531. Thank
    you.
        [The prepared statement of Mr. Maxx follows:]

        Prepared Statement of Raymond Maxx, Chairman, Navajo-Hopi Land
                                   Commission
        My name is Raymond Maxx. I am the Chairman of the Navajo-Hopi Land
    Commission, which is the Navajo Nation Council entity responsible for
    overseeing Bennett Freeze matters.
        Thank you for this opportunity to speak about S. 531, legislation
    that would formally strike from the U.S. code the provisions
    authorizing a development freeze in the western portion of the Navajo
    Nation.
        On November 3, 2006, the Navajo Nation, the Hopi Tribe and
    Secretary Kempthorne signed an intergovernmental compact in Phoenix
    settling the litigation over the western portion of the Navajo Nation
    that had been subject of a federal development restriction, commonly
    referred to as the Bennett Freeze. It was a wonderful day and signaled
    a new beginning for all the parties.
        Because my family was relocated twice by the Federal government,
    and now lives in the former Bennett Freeze area, I have first hand
    knowledge of what conditions are like. When we relocated to the Bennett
    Freeze area in the late 1970s, I don't think my parents fully
    understood that you could not fix your home in the Bennett Freeze; that
    you could not make additions; that no Federal, Tribal or State programs
    could assist your community through the building of infrastructure
    essential to the health and well-being of any community. As a result,
    the Bennett Freeze was locked into the poverty of 1966, when the freeze
    was imposed.
        For the families who live in the former Bennett Freeze area, so
    long as the authority for the Freeze remains in the U.S. Code, there
    also remains a fear that it could be reimposed. Passage of S. 531 would
    send a powerful signal that all parties have begun the process of
    moving on from the divisive disputes of the past. It would also ensure
    that there are no ambiguous interpretations which could lead to the re-
    imposition of the development freeze.
        In addition to passing S. 531, I would encourage the Committee to
    hold a field hearing on how the Bennett Freeze area can be redeveloped
    and what level of Federal support should be provided.
        Thank you for this opportunity to provide testimony on S. 531.
    Attachment

        The Chairman. Mr. Maxx, thank you very much.
        Finally, we will ask Mr. Gidner to comment on the other
    three pieces of legislation that have been testified to in this
    panel. Mr. Gidner?
        Mr. Gidner. Thank you, Mr. Chairman. This is the happier
    part of my testimony, because the Department supports all three
    of these bills.
        I will say, if I may preface my comments regarding H.R.
    2120, on the Sault Ste. Marie, I am myself a proud member of
    the Sault Ste. Marie Tribe. I am recused from this decision,
    but I will state the Department's position on the record. We
    support the bill with one clarifying amendment which is in the
    written testimony. If I could beg your forbearance, if you have
    any questions on this bill, if you could submit them in
    writing, because I am recused from the matter and really should
    not be answering questions about it in this forum.
        The Chairman. Is that 2120?
        Mr. Gidner. Yes, 2120. I am a member of the Sault Ste.
    Marie Tribe.
        The Chairman. Thank you.
        Mr. Gidner. Regarding H.R. 2963, on the land into trust for
    Pechanga, we support that bill. We do have some comments on it.
    The bill requires the Bureau of Land Management to complete a
    new survey within 180 days of enactment. We recommended that be
    changed to say as soon as practicable. The BLM does have a
    process and surveys in the queue. We would prefer this one join
    the queue rather than jump to the front, in fairness to the
    other survey work that needs to be done.
        There are also improvements on the land, and we would
    suggest that any improvements be transferred to the Tribe in
    fee and that the Department of Interior is not responsible for
    any improvements that may be transferred along with the lands.
        Finally, a minor matter, but the bill references the MOU
    between the Tribe and the U.S. Fish and Wildlife Service.
    Bureau of Land Management was also signatory to that MOU and we
    would recommended that the bill be amended to reflect that.
        Finally, S. 531, repealing the Bennett Freeze, we
    wholeheartedly support that. The Tribes, Hopi and Navajo,
    should be commended for the hard work and negotiations that
    have gone into that. They put aside decades of dispute, came up
    with a solution and everything that needs to happen has
    happened except for the repeal of this section. So we
    wholeheartedly support that.
        That concludes my testimony, Mr. Chairman.
        [The prepared statement of Mr. Gidner follows:]

    Prepared Statement of Jerry Gidner, Director, Bureau of Indian Affairs,
                        U.S. Department of the Interior
        Good morning, Chairman Dorgan, Vice Chairwoman Murkowski, and
    Members of the Committee. I am pleased to be here today to provide the
    Department of the Interior's (Department) position on H.R. 2120, a bill
    to direct the Secretary of the Interior to proclaim as reservation for
    the benefit of the Sault Ste. Marie Tribe of Chippewa Indians a parcel
    of land now held in trust by the United States for that Indian tribe;
    S. 2494, the ``Spokane Tribe of Indians of the Spokane Reservation
    Grand Coulee Dam Equitable Compensation Settlement Act''; H.R. 2963,
    the ``Pechanga Band of Luiseno Mission Indians Land Transfer Act of
    2007''; S. 1080, the ``Crow Tribe Land Restoration Act''; and S. 531, a
    bill to repeal section 10(f) of Public Law 93-531, commonly known as
    the `Bennett Freeze'.
    H.R. 2120
        We support the purpose of H.R. 2120, a bill to proclaim as
    reservation for the benefit of the Sault Ste. Marie Tribe of Chippewa
    Indians a parcel of land now held in trust by the United States for
    that Indian tribe. Currently, the matter is before the court as Sault
    Ste. Marie Tribe v. United States, Civ. No. 2:06-CV-276, and if
    Congress passes the legislation, it would put an end to the litigation.
        The Sault Ste. Marie Tribe (Tribe) is located in the far northern
    section of Michigan and has two reservations. The Tribe also has
    property the Department holds in trust for them that is not considered
    reservation land for purposes of the Indian Gaming Regulatory Act
    (IGRA). One such parcel is the subject of H.R. 2120, on which there is
    Indian housing, some other tribal facilities, a now-closed casino, and
    a casino housed in a temporary structure that has since been moved to
    another location. In 1988, the Tribe approached the Department to have
    the land proclaimed a reservation, along with five other parcels, but
    its paperwork was not completed prior to the enactment of IGRA.
        The Tribe seeks to game on adjoining property taken in trust in the
    year 2000. It built a new casino on this parcel. The Tribe was advised
    by the Department and the National Indian Gaming Commission that they
    would need to apply under IGRA for a two-part determination in order to
    game on the parcel. If Congress deems the first parcel to be
    reservation as of April 1988 for purposes of IGRA, then the tribe can
    game in its new casino under an exception in IGRA.
        We suggest amending the legislative language to reflect that ``the
    property shall be deemed a reservation as of April 19, 1988, for
    purposes of the Indian Gaming Regulatory Act.'' We will be happy to
    work with the Committee staff on amending the legislation to reflect
    the necessary changes.
    S. 2494
        The Department opposes S. 2494, the ``Spokane Tribe of Indians of
    the Spokane Reservation Grand Coulee Dam Equitable Compensation
    Settlement Act''. The Administration has worked with the Spokane Tribe
    over the last several years on this issue. We believe negotiations to
    correct several serious issues should continue.
        S. 2494 would provide compensation to the Spokane Tribe for the use
    of its land for the generation of hydropower by the Grand Coulee Dam.
    Specifically, S. 2494 would require the Secretary of the Interior,
    subject to the availability of appropriations, to deposit $99.5 million
    over five years, $23,900,000 for Fiscal Year 2008 and $18,900,000 for
    the following four fiscal years, into a trust fund held in the U.S.
    Treasury and maintained and invested by the Secretary of the Interior
    for the Spokane Tribe to be known as the ``Spokane Tribe of Indians
    Settlement Fund''. S. 2494 would also transfer certain land and
    administrative jurisdiction from the Bureau of Reclamation (BOR) to
    Bureau of Indian Affairs (BIA) for the Spokane Tribe. The land
    transferred would be held in trust for the Spokane Tribe and would
    become part of the reservation.
        The Spokane Tribe has not brought forward a legal claim that would
    warrant this type of settlement. The Administration questions whether
    the Tribe has or could bring any legal claim that would entitle it to
    compensation as contemplated under the bill. In light of the lack of
    any pending legal claim, the Administration does not believe this
    legislation is currently justified as a settlement of claims.
        The Department is also concerned with transferring land and
    jurisdiction from the Bureau of Reclamation to the Bureau of Indian
    Affairs for the Tribe absent a prior written agreement to fully address
    Reclamation's and National Park Service's future ability to manage
    Grand Coulee Dam, Lake Roosevelt, and the Columbia Basin Project. Such
    a written agreement should clearly address a number of issues
    associated with transferring land into trust status, such as future
    liability for damages from shoreline erosion and heavy metal
    contamination in sediments from upstream mining, as well as issues
    related to land and recreation management, including consideration of
    the existing five-party Lake Roosevelt Cooperative Management
    Agreement. While under the present draft Reclamation would be granted a
    perpetual easement to operate the Columbia Basin Project, it is
    imperative that the parties specifically reach agreement on the details
    of the lands and easement rights involved and how the transferred areas
    will be managed prior to the passage of this legislation. At a minimum,
    such an agreement should be required prior to the actual transfer
    taking place.
    H.R. 2963
        This legislation directs the Secretary of the Interior to transfer
    three parcels of public land totaling approximately 1,178 acres in
    Riverside County, California, currently managed by the Bureau of Land
    Management (BLM), into trust status for the benefit of the Pechanga
    Band of Luiseno Mission Indians (Tribe).
        The Department supports the bill, and recommends certain technical
    and clarifying amendments pertaining to an accurate legal description,
    surveys, valid existing rights, and improvements. We look forward to
    working with the Committee to resolve these concerns.
        The BLM has worked with the Tribe over the past several years
    concerning their interest in acquiring land to add to their
    reservation. These lands are covered by BLM's 1994 South Coast Resource
    Management Plan (RMP), which does not identify the parcels for
    disposal. The Department understands that the Tribe has enacted a
    resolution committing the Tribe to conserving the parcels' cultural and
    wildlife values. In addition, in 2005, the Tribe entered into a
    Memorandum of Understanding (MOU) with the U.S. Fish and Wildlife
    Service and the BLM, which states that the Tribe will manage the lands
    for conservation purposes, which this bill reflects. Recognizing the
    Tribe's interest in obtaining the land for cultural and conservation
    purposes, the BLM would be supportive of amending its land use plan to
    enable the transfer to proceed. The transfer process could take several
    years to complete, and the Tribe has sought this legislation to obtain
    the parcels more quickly through the legislative process.
        The first parcel is nearly 20 acres and contains significant
    cultural properties, including burials, of high importance to the
    Tribe. It is an isolated public land parcel characterized by rolling
    coastal sage scrub and surrounded by private, generally residential,
    lands. In response to potential threats to the cultural resources of
    the parcel, the BLM instituted a Public Land Order (No. 7343) in 1998
    that withdrew the entire parcel from surface entry, mining, mineral
    leasing, and mineral material sales. There are no other encumbrances,
    including mining claims, which are known to exist on the lands. A
    Memorandum of Understanding between BLM and the Tribe was initiated in
    2001, which outlines cooperative management of the parcel, including
    preservation of its cultural resource values. The Tribe owns and
    maintains an adjacent parcel of land containing another portion of the
    Pechanga Historical Site.
        The second, and much larger parcel, is slightly more than 958 acres
    and is adjacent to the Tribe's reservation. These lands are included in
    the Western Riverside County Multi-Species Habitat Conservation Plan
    and the Fish and Wildlife Service (FWS) has found them to be
    significant for their connectivity with rivers and as wildlife
    corridor. The Tribe and others were consulted on the Plan, and these
    wildlife values are encompassed in the Tribal resolution referenced
    above. This rugged parcel is characterized by a dense mix of oak
    woodlands, chaparral and coastal sage scrub, and slopes throughout the
    parcel are steep and eroded. The parcel also includes a service road
    right-of-way, as well as a 10-inch waterline and water tank that was
    granted for 30 years to the Rainbow Municipal Water District in 1983.
    No other encumbrances, including mining claims, are known to exist
    within this parcel. To resolve a trespass issue, 12.82 acres will be
    sold to San Diego Gas & Electric for fair market value in accordance
    with the Uniform Appraisal Standards for Federal Land Acquisitions and
    the Uniform Standards of Professional Appraisal Practice.
        The third parcel is 200 acres, which is included in the Multi-
    Species Habitat Conservation Plans of Western Riverside County. The
    resources in this parcel are similar to those in the second parcel.
        The Department does have some concerns with the bill. The bill
    requires the BLM to complete a new survey within 180 days of enactment.
    We recommend that the lands to be transferred be surveyed ``as soon as
    practicable,'' rather than within 180 days, as currently required by
    the bill. Additionally, we recommend language be added to the bill that
    specifies that any improvements, appurtenances, and personal property
    will be transferred to the Tribe in fee at no cost and the Department
    of the Interior is not responsible for any improvements, appurtenances,
    and personal property that may be transferred along with the lands. The
    Department feels this change is necessary since the federal government
    does not have a fiduciary obligation to repair and maintain any
    acquired improvements. Finally, the bill references the MOU between the
    Tribe and the U.S. Fish and Wildlife Service. The BLM was also a
    signatory of the MOU and we recommend the measure reflect that.
        The Department has had a very cooperative working relationship with
    the Tribe on the proposed land transfer and supports the bill's
    enactment with these modifications.
    S. 1080
        S. 1080 would require the Secretary to develop a program to acquire
    interests in land from eligible individuals within the Crow Reservation
    in the State of Montana and to hold those acquired interests in trust
    for the Crow Tribe (Tribe). The Department is very supportive of the
    goals to reunify the Tribe's reservation land and encourage the Tribe
    to manage its own assets; however, the bill raises considerable
    concerns as drafted. Therefore, the Department cannot support the bill
    at this time.
        We are concerned with the bill regarding its definitions, timing,
    size, and mechanisms. We look forward to working with the Committee to
    address our concerns with the bill and on ways to create a viable
    program.
    S. 531
        We support S. 531, a bill to repeal section 10(f) of Public Law 93-
    531, commonly known as the ``Bennett Freeze.''
        On November 3, 2006, Secretary Kempthorne, Navajo Nation President
    Joe Shirley Jr. and Hopi Vice Chairman Todd Honyaoma signed an historic
    Navajo-Hopi Intergovernmental Compact, resolving a 40-year-old dispute
    over tribal land in northeastern Arizona.
        The compact put an end to the ban on construction in the disputed
    area that was imposed by U.S. Commissioner of Indian Affairs Robert
    Bennett in 1966. Commonly known as the ``Bennett Freeze,'' this ban has
    greatly affected the use of this land and has been a severe hindrance
    to the people who live there.
        The agreement also provides that the United States Fish and
    Wildlife Service will study eagle populations in the disputed area and
    regulate the use of eagles depending on the size of the population. The
    Hopi Tribe and the Navajo Nation, which were in litigation since 1958
    concerning ownership of nearly 10 million acres on their reservations
    in northeast Arizona, also have agreed to dismiss litigation, to
    release each other from claims, and to share funds collected for the
    use of parts of the disputed property that are held by the Department
    of the Interior.
        While the agreement put an end to the ban on construction in the
    disputed area, the agreement did require the approval of the judge
    adjudicating the litigation between the Hopi Tribe and the Navajo
    Nation. The final requirement is to repeal that section of Public Law
    93-531 (25 U.S.C. 640(d)-9(f)), from current law in order to fully lift
    the ``Bennett Freeze.''
        Mr. Chairman, this concludes my statement and I will be happy to
    answer any questions you may have.

        The Chairman. Mr. Gidner, thank you very much. We
    appreciate your being here.
        Let me go back to the point you made with respect to the
    Crow Reservation. Tell me how long there have been discussions
    between Interior and the Crow Nation with respect to
    fractionation.
        Mr. Gidner. I am not sure exactly. It has been at least two
    or three years, I believe.
        The Chairman. Tell me again the objection of the Interior
    Department to this legislation.
        Mr. Gidner. In more detail, it is not an objection to the
    purpose, it is not an objection overall to the mechanism. I
    guess it is objections to the details. A small matter is the
    timing. The bill prohibits loans under this program after a
    certain date in 2012. We believe that needs to be updated. It
    is now already 2008. We don't think the program could be
    completed in that amount of time. Again, that is a minor timing
    issue.
        There are some concerns regarding the size of the loans,
    the loan program that is available. It may be better to break
    it into phases, so that the liability for the Government is not
    potentially so large. At one time, I think it was around $380
    million that was discussed in the bill.
        We also have questions about some of the definitions, for
    example, reasonable purchase price. It is unclear how that
    translates into the need for an appraisal and exactly how that
    would work. If appraisals would be required to be provided by
    the Department of Interior, that could be problematic due to
    our funding constraints and backlog of appraisal needs.
        The Chairman. H.R. 2120, do you support that generally?
        Mr. Gidner. Yes, the Department supports that, with one
    clarifying change which is set forth in the written testimony.
        The Chairman. Chairman Macarro, you said that you had been
    working with the BLM for 15 years to place the lands that you
    have described into trust for the Tribe. What, in your opinion,
    has taken so long to have these lands put into trust? Why has
    it taken that long?
        Mr. Macarro. It was actually 1990 when they initiated, at
    least in Southern California, involving this parcel, the first
    scoping hearing for lands potentially to be put on disposal. I
    think the pace of these things as they move characteristically
    through the BLM, with regard to transfers of land, tracts of
    land, my understanding is that the parcel is not slated for
    disposal officially. At previous times it has been and it
    hasn't been. So it has gone on and off the list. Just working
    through the administrative process, with different directors,
    area directors for the BLM, out of Palm Springs and a decade
    and a half of dealings, it is the pace of slow change.
        The Chairman. We are familiar with the word slow.
        [Laughter.]
        Mr. Macarro. Maybe deliberate.
        The Chairman. We hear it a lot in testimony before this
    Committee.
        Senator Murkowski.
        Senator Murkowski. Thank you, Mr. Chairman.
        Mr. Gidner, I wanted to ask you, because you have indicated
    that you support, the Administration supports all three of the
    bills that we have in front of us. With regard to S. 531, I
    think you used the words ``wholeheartedly support.'' But does
    the Department intend to devote any resources towards assisting
    the families or otherwise helping to develop this Bennett
    Freeze area? What is the intention within the agency?
        Mr. Gidner. I don't believe we have any budgeted resources
    for that at this time, Senator.
        Senator Murkowski. Is that something you would consider?
        Mr. Gidner. We would certainly consider that for the budget
    process, yes.
        Senator Murkowski. Chairman Payment, in your comments, Mr.
    Gidner has indicated that he can't give further commentary to
    this because he is conflicted. I appreciate that. If I
    understood all that you said, at some point during the time
    when you had made two previous requests for clarification of
    this legal status of the land, at one point in time they said
    that the approval was pending and that at a later point in time
    there was an admission, if you will, of administrative
    oversight. Is that, in your opinion, what has caused this
    delay? It has been just simply that, an administrative
    oversight, and it is not because of particular issues that may
    have been resolved that you think with this, we might be able
    to clear it up?
        Mr. Payment. Yes. It is kind of puzzling, because I am a
    student of political science, and I have looked through this
    very carefully. We pulled together all of our resolutions and
    did the research through documents the BIA had. Everything
    happened, the testimony happened, the local hearings happened
    with the community to see what the effects would be on the
    community. And the only thing that was left to happen was the
    reservation proclamation being published in the Federal
    Register.
        I think it is because of that we have been able to show
    that and work closely with the BIA that they acknowledge that.
    They don't really know why it didn't happen. So the only
    shortcoming is they don't believe they have the authority to do
    it this many years later. They encouraged us to actually write
    a bill.
        We also have legislation and we are prevailing in that
    legislation, but it seems an unnecessarily adversarial role to
    be suing the Department of Interior on this situation when it
    can be resolved through legislation. We have litigation, I
    meant.
        Senator Murkowski. Right. Good.
        And this is a question to both Chairman Nuvamsa and to
    Delegate Maxx. Should we be successful with the legislation in
    lifting this freeze, what do you hope or what kinds of
    development are you looking to for the Hopi and the Navajo
    Tribes, if we are successful with this?
        Mr. Nuvamsa. Thank you, Senator Murkowski.
        The area is isolated. One of the first things we need to do
    is develop the infrastructure. The people living out there,
    roads are in terrible shape. The utilities and so on.
        Senator Murkowski. There are roads in the area, though?
        Mr. Nuvamsa. Leading up to there. As people begin to occupy
    this area, we are going to need to have infrastructure
    development. Because again, this area is isolated. I think that
    would be the beginnings of it, that we have some plans on the
    future use of it, but because of the freeze and so on, we have
    been unable to do so at this point. But I see people beginning
    to occupy and be able to, again, enjoy the same quality of life
    that everybody enjoys by development, the infrastructure,
    utilities and so on.
        Senator Murkowski. Mr. Maxx, did you want to add anything
    to that?
        Mr. Maxx. Thank you, Senator. Along with infrastructure,
    the basic need of housing, we are really lacking housing. For a
    long time, you couldn't even repair a home unless you had
    permission. And the process took at least five years to get a
    door or a roof fixed.
        Senator Murkowski. Even to make repairs to existing
    infrastructure, you couldn't fix your roof under this freeze?
        Mr. Maxx. That was prohibited under the freeze. So basic
    homes, roads, infrastructure and Navajo Nation is like 30 years
    or 20 years behind mainstream society. The Bennett Freeze area
    is like 30 or 40 years behind Navajo. So that would show you
    what kind of situation the former Bennett Freeze area is in,
    after 40 years of Bennett Freeze, it really needs a lot of
    homes and infrastructure and improvements to catch up with the
    mainstream.
        Senator Murkowski. Thank you. I appreciate the responses
    and I appreciate the testimony of all of you this morning.
        Thank you, Mr. Chairman.
        The Chairman. Senator Tester.
        Senator Tester. Thank you, Mr. Chairman.
        I have one question for Chairman Payment. Just a
    clarification about the 65 acres that is under trust, correct?
    Does it physically border your current reservation? I thought I
    heard you say that, but I just wanted to make sure that is the
    case.
        Mr. Payment. Yes, it does. We actually had an option on
    both parcels when we first looked at buying it. But we became
    recognized in 1972, we didn't have gaming until 1985, we didn't
    have resources to buy all of the land. So we optioned both
    parcels, but we purchased one piece. It is contiguous, and you
    can see the not in my backyard, we are not in anybody's
    backyard. We are about three or four miles outside of the city
    proper.
        We have their support, but we don't abut anybody else's
    property. It is contiguous to our existing trust land.
        Senator Tester. Okay, thank you.
        Mr. Gidner, you had mentioned three things that you had
    concerns about, the 2012 time line, the size of the land I
    think who determines reasonable purchase price, if I heard you
    correctly. Are there any other concerns?
        Mr. Gidner. There have been questions raised about whether
    a direct loan program is appropriate as opposed to some sort of
    guaranteed loan program, which we already have. So I would just
    add that.
        Senator Tester. What you already have in the form of what?
        Mr. Gidner. We have a guaranteed loan program already.
        Senator Tester. For this purpose?
        Mr. Gidner. Well, not specifically for this purpose, for
    economic development generally.
        Senator Tester. Okay. The 2012 time line, what kind of time
    line does the Department think it should be at?
        Mr. Gidner. Originally, I believe we had five years. If the
    amount of money was the same, it is possible for it to be done
    in five years, that would be after the enactment of the bill.
        Senator Tester. I think that could be easily fixed. How
    about the reasonable purchase price? Would you have a problem
    if that was done, if the Tribe were to contract that out
    through their administrative costs?
        Mr. Gidner. I don't think so. We have a problem because we
    have a large backlog of appraisals or we have an appraisal
    process that takes a period of time and we have a certain
    number of people to do it.
        Senator Tester. So if the Tribe were to get a neutral party
    and have them do the appraisal, the Department of Interior
    would accept that appraisal?
        Mr. Gidner. I think we probably would, Senator.
        Senator Tester. Okay, good.
        The size of the loan, and 380 million bucks is a lot of
    dough, no mistake about it. Are you familiar with Cobell?
        Mr. Gidner. Yes, sir.
        Senator Tester. Do you agree with the Chairman's statement
    that 10 percent of the fractionated land is on Crow?
        Mr. Gidner. I have no reason to doubt that. I know they
    have a large percentage of fractionated land.
        Senator Tester. Well, I will just tell you my perspective.
    And you can take this back to whoever you want, but I will just
    tell you my perspective. My perspective is that you have a
    chairman and you have a tribe that wants to fix this problem. I
    think they have put a very common-sense, fair proposal out that
    is cost-effective. You can run the numbers on Cobell and you
    can run the numbers on this. Cobell hasn't happened and this
    hasn't happened either.
        I think if I was the head of your agency, I would be
    grabbing that guy sitting right there right around the
    shoulders and hugging him and saying, you know what, we are
    going to get this done. I really would. Three hundred eighty
    million is a lot of money, but you are talking 1.7 million
    acres and you can solve a major problem and set an example and
    get this fractionated land, get us on the road to solving this
    fractionated land problem. I think it is the right thing to do,
    and if I were you guys, I would be aggressively pursuing this
    as an option. I would be telling us that we need to have this
    happen, we need to pass this bill, because this is the right
    thing to do and now.
        I am telling you, I do not see the problems that you put
    out as being--I understand them. I agree with them for the most
    part and I think they could be easily, very easily remedied.
    But the size and the fact that it is a loan program and the
    fact that we are going to solve these problems with this, I
    just think that it is the right thing to do.
        The last thing I would ask you is this. When you head back
    to the Department, if there are further objections to 1080, I
    would like to have your response in writing on those, and to
    what extent, and your suggestions for solving those. I think
    Senator Baucus and myself would love to have those, as sponsors
    and co-sponsors of the bill.
        Thank you.
        The Chairman. Senator Barrasso.
        Senator Barrasso. Thank you, Mr. Chairman.
        I think Senator Tester touched on many of the things I was
    interested in, in terms of the five-year time line and the
    difficulties with an appraisal. But you mentioned something
    about Government liability. I am an orthopedic surgeon, I know
    a lot about liability. Could you kind of go into a little bit
    what you are talking about in terms of the Government's
    liability here?
        Mr. Gidner. Certainly. As I understand the mechanism of the
    bill, the Treasury Department would loan money to the Secretary
    of Interior, who would loan it to the Tribe or a corporate
    entity set up by the Tribe. The Tribe would pay that money
    back, the Secretary would pay the money back to Treasury.
        If the Tribe did not pay the money back to the Secretary of
    Interior, the Secretary of Interior still must pay back the
    Secretary of Treasury. I am not at all suggesting the Crow
    Tribe would not pay back, but if that did occur, the Secretary
    of Interior would have a liability to the Treasury Department
    for monies that we would not have at that point.
        Senator Barrasso. So just because it goes through another
    department is the issue? Because it is the same thing with any
    loan that needs to be paid somewhere.
        Mr. Gidner. Basically, yes.
        Senator Barrasso. Thank you.
        No further questions, Mr. Chairman.
        The Chairman. Mr. Macarro, I want to ask a question about
    the allegations dealing with the Endangered Habitats League. I
    don't know all the facts surrounding it. What is your response
    to allegations on that subject?
        Mr. Macarro. Could you be a little bit more specific about
    the allegations?
        The Chairman. My understanding is there have been questions
    raised about endangered habitat. Is that correct?
        Mr. Macarro. I think that allegation refers to a previous
    transaction, not this one. I am not going to try to make their
    case for them. But we constructed a golf course on some
    previously acquired land that went into trust, it was through
    administrative process. I think they have concerns that despite
    the representations we are going to make here with regard to
    this piece of land, what is to stop us from doing that again.
        All I can say is that they are two different transactions
    altogether. We are taking some unusual measures with this
    proposed transaction, this proposed bill today, restricting us
    in agreement with the Fish and Wildlife Service to transfer the
    lands. We are stipulating that they will only be used for
    protection, preservation and maintenance of the archeological,
    cultural and wildlife resources thereon, that is actually
    quoting from the bill language.
        The Chairman. I was referring to the Endangered Habitats
    League of Southern California, that had raised questions. But
    your response is that the bill itself has drafted responses to
    those questions?
        Mr. Macarro. It does. It should allay those concerns. They
    have never worked with tribes, per se, and I think they have
    issues with self-determination powers that tribes have when
    they chose to do things that they don't think are in the public
    interest.
        The Chairman. I understand.
        Let me thank all of you for being here to testify. Mr.
    Gidner, thank you for coming down. We will be considering these
    pieces of legislation that we have heard today at some future
    business meeting, we hope soon. I thank all of you for taking
    the time to come before the Committee.
        We will keep the hearing record open for 14 days following
    today's hearing, so that additional submission of statements
    will be accepted by our Committee. This hearing is adjourned.
        [Whereupon, at 10:50 a.m., the Committee was adjourned.]
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