[Senate Hearing 113-423]
[From the U.S. Government Publishing Office]






                                                        S. Hrg. 113-423

 IMPROVING THE TRUST SYSTEM: CONTINUING OVERSIGHT OF THE DEPARTMENT OF 
                  THE INTERIOR'S LAND BUY-BACK PROGRAM

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

                                HEARING

                               before the

                      COMMITTEE ON INDIAN AFFAIRS
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 16, 2014

                               __________

         Printed for the use of the Committee on Indian Affairs


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                      COMMITTEE ON INDIAN AFFAIRS

                     JON TESTER, Montana, Chairman
                 JOHN BARRASSO, Wyoming, Vice Chairman
TIM JOHNSON, South Dakota            JOHN McCAIN, Arizona
MARIA CANTWELL, Washington           LISA MURKOWSKI, Alaska
TOM UDALL, New Mexico                JOHN HOEVEN, North Dakota
AL FRANKEN, Minnesota                MIKE CRAPO, Idaho
MARK BEGICH, Alaska                  DEB FISCHER, Nebraska
BRIAN SCHATZ, Hawaii
HEIDI HEITKAMP, North Dakota
        Mary J. Pavel, Majority Staff Director and Chief Counsel
              Rhonda Harjo, Minority Deputy Chief Counsel














                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on July 16, 2014....................................     1
Statement of Senator Barrasso....................................     3
Statement of Senator Franken.....................................    14
Statement of Senator Heitkamp....................................    12
Statement of Senator Tester......................................     1

                               Witnesses

Connor, Hon. Michael, Deputy Secretary, U.S. Department of the 
  Interior.......................................................     3
    Prepared statement...........................................     5
Keough, Jennifer, Executive Vice President/CEO, The Garden City 
  Group, Inc.....................................................    29
    Prepared statement...........................................    31
Lankford, Hon. Carol, Vice-Chair, Confederated Salish and 
  Kootenai Tribes of the Flathead Reservation....................    16
    Prepared statement...........................................    18
Hancock, Helo, Legislative Director, Coeur d'Alene Tribe.........    24
    Prepared statement of Hon. Ernest L. Stensgar, Vice-Chairman, 
      Coeur d'Alene Tribe........................................    25
Waukon, Hon. Susan, Representative, Ho-Chunk Nation Legislature..    20
    Prepared statement...........................................    22

                                Appendix

Archambault II, Hon. Dave, Chairman, Standing Rock Sioux Tribe, 
  prepared statement.............................................    46
Azure, Hon. Mark L., President, Fort Belknap Indian Community, 
  prepared statement.............................................    48
Hall, Hon. Tex, Chairman, Mandan, Hidatsa and Arikara Nation, 
  prepared statement.............................................    43

 
                      IMPROVING THE TRUST SYSTEM: 
                      CONTINUING OVERSIGHT OF THE 
           DEPARTMENT OF THE INTERIOR'S LAND BUY-BACK PROGRAM

                              ----------                              


                        WEDNESDAY, JULY 16, 2014


                                       U.S. Senate,
                               Committee on Indian Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:30 p.m. in room 
628, Dirksen Senate Office Building, Hon. Jon Tester, 
Chairman of the Committee, presiding.

             OPENING STATEMENT OF HON. JON TESTER, 
                   U.S. SENATOR FROM MONTANA

    The Chairman. The Senate Indian Affairs Committee will come 
to order.
    This afternoon we are discussing the implementation of the 
Cobell settlement and recent efforts by the Department of the 
Interior to reform and improve their trust management services. 
The Federal Government holds over 56 million acres in trust for 
tribes and individual Indians. The Department of Interior 
manages these lands as well as a number of other trust assets, 
including timber, minerals and other natural resources.
    Many tribes have also established trust funds and 
settlement funds that are maintained by the Department. Within 
the Department a number of agencies are involved in carrying 
out the various trust services and management roles, including 
the Bureau of Indian Affairs, the Office of Special Trustee, 
and the Bureau of Land Management. While these agencies may do 
most of the work in Indian Country, I think everyone is aware 
that every Federal agency across the government shares in 
upholding our Country's trust responsibility to tribal 
communities.
    The current Administration has done a remarkable job in 
settling tribal claims of past mismanagement of trust 
resources. Over 70 tribal lawsuits have been settled, and of 
course, the Cobell settlement provided some closure to the 
hundreds of thousands of individual Native Americans whose 
trust assets were mismanaged.
    We will talk about that settlement today. One half of the 
settlement would provide nearly $1.5 billion to the individual 
Indians across the Country. These individuals have land and 
other trust assets that the government did not properly manage 
for decades, and these payments are meant to address these 
mistakes.
    However, four years after the settlement was first agreed 
upon and 20 months after the final approval by the courts, 
these payments have not gone out. The first wave of payments 
was distributed, but the second and for many people, the larger 
payment, has yet to be delivered.
    So we will have witnesses today who can comment on these 
delays and share with us when these payments will finally be 
made. These payments will go a long way in helping families 
across Indian Country.
    The settlement also provided $1.9 billion to the Department 
of the Interior to operate a land Buy-Back program. The Buy-
Back program will purchase small fractional ownership interests 
in trust lands from individuals willing to sell their 
interests. While many people have raised concerns that half the 
settlements funds were given to the Department, at least 85 
percent, or $1.5 billion of this fund, will go directly to 
individual Indians who decide to sell their fractionated 
interests in trust lands. These interests in land purchased by 
the Department will then be consolidated into tribal ownership 
with the goal of freeing up the land for beneficial use by the 
tribes.
    When we last heard about the Buy-Back program in December, 
no purchases had yet been made. Since then, over $70 million 
has gone out to individual Indians and over 200,000 acres have 
been consolidated back to tribal ownership.
    While the program has made great strides in a small number 
of reservations, yet there is still a lot of work to be done. 
The land Buy-Back program is required to carry out the program 
within 10 years and we are now 20 months in. To ensure that the 
program is successful within those 10 years, the Department 
will need to expand the program to more reservations and to do 
so quickly. I understand the program has identified 20 
reservations it intends to target by the end of 2015, and I 
hope the Department can meet that goal. This Committee has 
heard concerns from tribes that the program is moving too 
slowly and that cooperative agreements between the programs and 
the tribes are difficult and time-consuming to negotiate. I 
think the program is up to about 12 tribes with agreements, and 
work can now begin on appraising and purchasing these 
fractional interests in land at these tribes' reservations.
    So we hope to hear today from our witnesses on how the Buy-
Back program successes over the past six months can be 
replicated at more locations and how the program can continue 
to improve. Our hearing today will also focus on the 
Department's ongoing trust reform efforts, departmental reforms 
and how it manages trust assets and provides services to tribe 
and individual Indians to ensure that there is never a Cobell-
like lawsuit again.
    Along with settling Cobell, the Secretary of Interior 
created a Commission on Indian Trust Administration and Reform. 
This Commission released its final report in December with a 
number of administrative and legislative recommendations. We 
hope today that the Deputy Secretary of Interior can shed some 
light on how the Department is implementing those 
recommendations.
    With that, I want to welcome Mike Connor, the Deputy 
Secretary of Interior. Mr. Connor has direct oversight over the 
land Buy-Back program and is responsible for making sure 
various agencies involved are all working together to get this 
important work done.
    Mr. Connor, I believe this is your first time in front of 
this Committee since being confirmed by the full Senate. I want 
to thank you for being here today, as I am sure Assistant 
Secretary Washburn appreciates that you are here today. But the 
fact is, just for the record, I appreciate your work in 
previous capacities in government and with this new position 
that is still relatively new to you. You are more than capable 
of doing an incredibly good job at this. So we hope that you 
can shed some light on how the Department is implementing the 
recommendations that I just spoke of.
    When Senator Barrasso gets here, he will be given the 
liberty to make his opening statement but--yes, he is here. 
Look at that. Senator Barrasso, I will turn the floor over to 
you.

               STATEMENT OF HON. JOHN BARRASSO, 
                   U.S. SENATOR FROM WYOMING

    Senator Barrasso. Thank you very much, Mr. Chairman, for 
holding this important hearing. The Committee is well aware of 
the problems created by the magnitude and complexity of the 
issue that we are talking about, fractionation in Indian 
Country. The Buy-Back program is an unprecedented opportunity 
to address this issue. Last December, the Committee received 
testimony regarding a number of issues facing the 
implementation of this program. I look forward to hearing from 
our witnesses on what progress has been made since the time of 
plans for continued improvement.
    So I welcome all those who are testifying today and thank 
you very much, Mr. Chairman.
    The Chairman. Thank you, Vice Chair Barrasso, for your 
comments. With that, Mike, I will give you the time. Know that 
your entire statement will be a part of the record. If you 
could hold your testimony to five minutes, it would be much 
appreciated. Go ahead, Mike.

   STATEMENT OF HON. MICHAEL CONNOR, DEPUTY SECRETARY, U.S. 
                   DEPARTMENT OF THE INTERIOR

    Mr. Connor. Thank you, Mr. Chairman, Vice Chairman 
Barrasso. I appreciate the opportunity to be here today.
    I so appreciate your opening comments recognizing the work 
that we have done in this Administration to resolve overall a 
lot of the claims and litigation against the United States for 
mismanagement of trust resources over time. That has been a big 
focus, because we certainly want to turn the corner and get to 
a more cooperative working relationship with tribes and I think 
we have managed to turn the tide in that direction right now. 
But of course, there is a lot more work to be done, and we look 
forward to this.
    I recognize certainly that this is not the Committee's 
first hearing on the land Buy-Back program, but it is certainly 
the first time I have been here as Deputy Secretary. I can 
assure you that it is one of my highest priorities in my 
responsibilities at the Department.
    As you know, in recognition of the complexity and 
importance of the program, it was established in the Office of 
the Secretary with a program manager reporting to me. The 
Department also established an oversight board, which I chair. 
While the small team of staff is dedicated to the success of 
the program, this oversight board, which includes of course 
myself, the solicitor, the Assistant Secretary of Indian 
Affairs, Director of Bureau of Indian Affairs and the Special 
Trustee for American Indians provides regular oversight and 
guidance to the program.
    In 2010, Congress enacted the historic legislation that 
brought the Cobell litigation to a close. After decades of 
contentious litigation that affected virtually every aspect of 
the Department's relationship with tribes, the legislation 
opened up a new chapter by providing, among other things, the 
$1.9 billion in funds you referenced to restore fractionalized 
lands to trust ownership. This fund will help reverse the 
impacts of the repudiated and the very unfortunate allotment 
and assimilation policy.
    The magnitude of fractionation is enormous. There are more 
than 2.9 million trust or restricted fractional interests 
spread across more than 150 reservations that are owned by more 
than 243,000 individuals. On the charts you can see there is 
the Pine Ridge Reservation and the green, dark green and light 
green indicate the areas where the program has resulted in the 
purchase of fractionated interests that just shows you the 
magnitude on that particular reservation.
    The program embodies the priorities set forth by President 
Obama's national policy initiative to build effective 
partnerships with American Indian communities and work more 
efficiently to find solutions to the challenges they face. 
Through ongoing collaboration with tribal governments and 
outreach to individuals, we will facilitate improvements to 
advance vital economic and social priorities and restore tribal 
homelands.
    As Deputy Secretary, I am committed to this program and 
continuing an opening and honest dialogue with tribal nations 
and individual landowners. I would like to briefly highlight 
three areas that are in my written testimony.
    First, consolidated land and what we have done so far. Thus 
far, the Buy-Back program has made more than 33,000 purchase 
offers to owners of fractional interests. With significant 
coordination with tribe, we have successfully concluded 
transactions with more than $72 million in the last six months, 
restoring the equivalent of more than 203,000 acres of land to 
tribal ownership. As a result of these purchases, the program 
has also made contributions to the Cobell Education Scholarship 
Fund, which is managed by the American Indian College Fund, and 
our scholarship contributions so far exceed $3 million.
    Simply put, the program is now gaining substantial 
momentum, which is translating into tangible progress for both 
tribes and individual landowners.
    Increased tribal involvement. Early in the development of 
the program, we recognized that tribal involvement was crucial 
to the success of the Buy-Back program. The agreements we have 
reached recently are a result of joint planning over many 
months. Our staff is working tirelessly with tribes in a 
collaborative process to develop agreements that will guide 
implementation on their reservations. Each agreement is a 
product of information sharing and thoughtful discussions 
resulting in a tailored approach for each community.
    I recognize that each tribe is unique and in many cases 
with special allotment statutes or histories. The success 
achieved so far is due in large measure to the insight and 
commitment from the many tribal leaders and staff that are 
working with us. I want to recognize their efforts and 
reiterate the value of their continued involvement.
    In May, based on tribal input, the Department announced a 
schedule through 2015 for the continued implementation of the 
program that identifies 21 locations representing nearly half 
of all fractionated interests and half of all owners across 
Indian Country. Substantial land consolidation actions will 
occur on those reservations over the next 18 months, and we 
anticipate adding tribes to the current schedule. To date, to 
facilitate tribal involvement, the Department has entered into 
cooperative agreements or other understandings totaling more 
than $4.8 million with 12 of those tribes.
    Finally, national outreach to individuals. With respect to 
outreach, it is critical that Indian landowners are aware of 
the Buy-Back program, understand the opportunity to sell their 
fractional interests for the benefit of the tribal community, 
and have the assistance they need to make informed decisions 
and complete the process if they choose to sell. Effective 
outreach helps to advertise the program, stimulate land use 
planning, identify willing sellers, locate owners where 
whereabouts are unknown, address questions to determine the 
fractionated tracts tribes wish to consolidate.
    The Department has expanded our natural outreach, given the 
landowners in Pine Ridge Reservation, for example, reside in 
all 50 States as well as in foreign countries. I recently 
hosted a listening session in Portland, Oregon to share 
information and hear from Indian Country and will continue to 
plan visits over the next several months.
    Mr. Chairman, that concludes my statement and I am happy to 
answer questions on the Buy-Back program or any of the other 
subjects you mentioned.
    [The prepared statement of Mr. Connor follows:]

   Prepared Statement of Hon. Michael Connor, Deputy Secretary, U.S. 
                       Department of the Interior
I. Introduction
    Good afternoon, Chairman Tester, Vice-Chair Barrasso, and Members 
of the Committee. Thank you for the opportunity to provide the 
Department of the Interior's (Department) statement at this oversight 
hearing on ``Improving the Trust System.''
    In 2010, Congress enacted historic legislation to bring to a close 
the Cobell litigation. After decades of contentious litigation that 
affected virtually every aspect of the Department's relationship with 
tribes, the legislation opened a new chapter by providing, among other 
things, a $1.9 billion Trust Land Consolidation Fund (Fund) to restore 
fractionated lands to tribal trust ownership. This $1.9 billion fund 
helps to reverse the impacts of the repudiated allotment and 
assimilation policy. That destructive policy resulted in the loss of 
approximately 90 million acres of tribal lands in less than 50 years. 
Although Congress repudiated that policy 80 years ago, its impact on 
nearly every aspect of tribal life--whether it be law enforcement, 
economic development or day-to-day governance--continues to be felt 
every day in tribal communities.
    The magnitude of fractionation is enormous. There are over 2.9 
million trust or restricted fractional interests spread across more 
than 150 reservations that are owned by more than 243,000 individuals. 
Approximately 90 percent of the fractional interests are located within 
40 reservations. The Pine Ridge Reservation alone accounts for over 8 
percent of the purchasable fractional interests.
    The Land Buy-Back Program for Tribal Nations (Buy-Back Program) is 
one tool that helps alleviate the impacts of fractionation.
    Through purchases from willing sellers, the Buy-Back Program is 
transferring trust and restricted interests directly to tribes so that 
tribes can utilize the land. Thus far, the Buy-Back Program has 
transferred the equivalent of more than 203,000 acres of land to 
tribes. In the short term, much of the money paid to obtain the 
interests may be spent in these tribal communities. In the long-term, 
transferring millions of acres of land to tribes is aimed at 
strengthening each tribal community and generating economic and 
generational benefits to those communities. Tribal acquisition of 
fractionated lands ``unlocks'' those lands, making them available to 
support economic development to benefit tribal members. Moreover, as 
sales occur, the Buy-Back Program contributes part of the Fund (up to 
$60 million) to the Cobell Education Scholarship Fund managed by the 
American Indian College Fund. This funding will help open doors and 
create opportunities for current and future generations of Native 
college students; contributions to the scholarship fund so far exceed 
$3 million dollars.
II. Implementation of the Buy-Back Program
    The Cobell Settlement became final on November 24, 2012, following 
the exhaustion of appeals through the U.S. Supreme Court. Less than a 
month following final approval, the Department established the Buy-Back 
Program and published an Initial Implementation Plan. The Department 
engaged in government-to-government consultation on the Plan--with 
consultations in Minneapolis (January 2013); Rapid City (February 
2013); Seattle (February 2013) and held numerous meetings with tribes 
and inter-tribal organizations. With the benefit of significant tribal 
input and involvement, the Program published an Updated Implementation 
Plan in November 2013.
    In recognition of the complexity and importance of the Buy-Back 
Program, it was established in the Office of the Secretary with a 
Program Manager reporting to me. The Department also established an 
Oversight Board, chaired by me. The Oversight Board, which includes the 
Solicitor, the Assistant Secretary-Indian Affairs, the Director of the 
Bureau of Indian Affairs, and the Special Trustee for American Indians, 
provides regular oversight and guidance for the Program.
    The Settlement's unique attributes and ten-year timeframe 
distinguish the Buy-Back Program from many other Federal programs that 
have an indefinite lifespan. The parameters in the Settlement 
necessitate quick and expedient implementation at each location to 
maximize the number of locations and landowners that may participate in 
the Program.
    We are working diligently to implement the Program at many 
locations. As of July 15, 2014, we have:

   Sent over 33,500 purchase offers with a total value of 
        nearly $300 million for four locations, including initial 
        offers to landowners with interests at the Fort Belknap Indian 
        Community (the offers provided have given more than 80 percent 
        of the eligible landowners with interests at Pine Ridge and 
        Rosebud an opportunity to participate in the Program);

   Transferred land to tribal trust ownership for three tribes, 
        totaling the equivalent of more than 203,000 acres through 
        purchases from willing sellers;

   Made payments to individual willing sellers totaling more 
        than $72 million (payments are deposited directly into 
        Individual Indian Money (IIM) accounts typically within an 
        average of five days of receiving a complete, accepted offer 
        package);

   Additional offers are expected for at least four more 
        locations by the end of the calendar year;

   Created initial mapping dataset for 51 fractionated 
        locations and shared the same with 27 tribes;

   As of early June 2014, implementation expenditures for Buy-
        Back activities are $13.8 million (some of these expenditures 
        include one-time, up-front costs, such as mapping, equipment, 
        and system updates):

    --Outreach--$3.2 million;
    --Land Research--$2.2 million;
    --Valuation--$1.6 million; and
     --Acquisition--$6.8 million (includes offer processing capacity 
        for future years);

   Obtained independent, outside review of the Program's 
        appraisal methodology by The Appraisal Foundation;

   Launched a substantive website, www.doi.gov/buybackprogram, 
        to provide information about the Buy-Back Program, especially 
        for tribes and individual landowners;

   Expanded our Trust Beneficiary Call Center to answer 
        questions, update owner contact information, and register 
        ``willing sellers;''

   Established policies such as flexible purchase ceilings for 
        fractionated reservations to ensure that funds are not fully 
        expended at just a few locations and that as many reservations 
        as possible can benefit from the Buy-Back Program;

   Set a base payment amount of $75 for submitting an accepted 
        offer and a base payment of $7.50 per acre for subsurface or 
        mineral ownership interests with nominal or no value;

   Held webinars in cooperation with the National Congress of 
        American Indians to educate landowners and tribal staff about 
        the Program;

   Created and published cooperative agreement guidance and 
        application templates;

   Developed a streamlined acquisition process, including an 
        update to the deed based on feedback from individual 
        landowners;

   Attended national and regional tribal events that include 
        staff booths to meet with landowners and distribute 
        informational materials; and

   To administer the Program, we have hired 57 full time 
        federal employees to date, most of which are within the Office 
        of the Special Trustee for American Indians, the Office of 
        Minerals Evaluation, and the Bureau of Indian Affairs to 
        perform outreach, land research, valuation, and acquisition 
        activities.

III. Tribal Involvement
    Tribal leadership and involvement are crucial to the success of the 
Buy-Back Program. Secretary Jewell (and before her Secretary Salazar) 
strongly supports tribal involvement in carrying out the Program. In 
December 2012, with the release of our Initial Implementation Plan, the 
Department emphasized that it ``hopes to enter into cooperative 
agreements with many tribes and take advantage of tribes' ability to 
minimize administrative costs and improve overall effectiveness and 
efficiency of the Buy-Back Program.'' In 2013, the Program sought to 
update its strategy to expand tribal engagement, and Secretary Jewell 
stated that the Department's ``productive working relationship with 
tribes and our commitment to landowner outreach will continue to be 
major driving forces of the Program.'' The Assistant Secretary-Indian 
Affairs and I recently led a listening session in Portland, Oregon, to 
hear directly from landowners and tribes about their ideas and 
perspectives on the Program and our progress thus far.
    The Program has communicated directly with nearly 80 tribes (28 
with jurisdiction over the most fractionated reservations), including 
meetings with several on or near their reservations. We heard from 
Indian Country that all fractionated locations should have the 
opportunity to participate, not simply the locations with 90 percent of 
fractionated lands. As a result, the Program has pursued opportunities 
to include less fractionated locations in early implementation efforts, 
which will help us develop a comprehensive strategy for the purchase of 
fractional interests at as many less fractionated locations as 
possible.
    We recognized that the Department cannot develop an implementation 
schedule without input from tribes. To expand tribal involvement, we 
held an open solicitation period from November 2013 to March 2014, 
requesting expressions of interest from the tribes exercising 
jurisdiction over the most fractionated reservations. As a result, 
nearly sixty tribes submitted a cooperative agreement application or 
letter of interest to the Program. The open solicitation facilitates 
increased tribal input on the timing and sequencing of Program 
implementation. The Department relied on this tribal interest along 
with other factors, such as degree of ownership overlap, geographic 
diversity, and appraisal complexity, to guide implementation of the 
Buy-Back Program. In May 2014, we announced a schedule through 2015 for 
the continued implementation of the Buy-Back Program that identifies 21 
locations representing nearly half of all the fractional interests and 
half of all owners across Indian Country. The Department continues to 
implement the Buy-Back Program in a flexible manner and update its 
approach to reflect lessons-learned, best practices, and tribal 
involvement.
    To date, the Department has entered into cooperative agreements or 
other understandings, totaling over $4.8 million, with 12 tribes 
located in the Great Plains, Rocky Mountain, Northwest, and Western 
regions:

   Assiniboine and Sioux Tribes of the Fort Peck Reservation;
   Coeur D'Alene Tribe of the Coeur D'Alene Reservation;
   Confederated Salish and Kootenai Tribes of the Flathead 
        Reservation;
   Confederated Tribes of the Umatilla Indian Reservation;
   Crow Tribe of Montana of the Crow Indian Reservation;
   Fort Belknap Indian Community of the Fort Belknap 
        Reservation of Montana;
   Gila River Indian Community of the Gila River Indian 
        Reservation;
   Makah Indian Tribe of the Makah Indian Reservation;
   Northern Cheyenne Tribe of the Northern Cheyenne Indian 
        Reservation;
   Oglala Sioux Tribe of the Pine Ridge Reservation;
   Sisseton-Wahpeton Oyate of the Lake Traverse Reservation;
   Standing Rock Sioux Tribe

    These agreements support the involvement of more than 49 full-time 
employees that are or will be employed directly by the tribes. More 
cooperative agreements will be announced soon.
    All 12 tribes with cooperative agreements or other arrangements are 
conducting outreach activities because tribal leadership is critical in 
assisting landowners to make informed and timely decisions about 
purchase offers. Tribes are assisting with this critical task by using 
methods best suited to the needs of their communities. They are 
updating landowner contact information, notifying landowners of 
upcoming purchase offers, identifying willing sellers, and hosting 
various community outreach events. Four tribes are conducting 
significant land research to prepare the necessary information about 
the fractionated land to assist with determining the fair market value 
of the lands. Tribes have made helpful contributions related to this 
task, including mapping activities, provision of information about land 
use, collection of comparable sales information, and assistance with 
minerals evaluation. Three tribes are also conducting appraisals of 
tracts prioritized by the tribes for acquisition; they are actively 
working with the Department to finalize their products, which will 
serve as the basis for purchase offers to landowners.
    In sum, each agreement is the product of information sharing and 
thoughtful discussions between a tribal government and the Department, 
resulting in a tailored approach for the specific needs of the tribal 
community. Although the Department is willing to run the Program 
without a formal tribal cooperative agreement, the Department will 
continue to pursue cooperative agreements with many tribes to implement 
the Buy-Back Program through a federal-tribal partnership, which will 
promote tribal ownership of the Program, minimize administrative costs, 
and improve overall effectiveness and efficiency.
IV. Land Buy-Back Outreach Efforts
    It is a priority for the Department to work with tribal leaders to 
ensure that Indian landowners are aware of the Buy-Back Program, 
understand the opportunity to sell their fractional interests for the 
benefit of their tribal community, and have the assistance they need to 
make informed decisions and complete the process if they choose to 
sell. Effective outreach helps to advertise the Program, stimulate land 
use planning, identify willing sellers, locate owners whose whereabouts 
are unknown, address questions, and determine tribal priorities 
regarding what type of fractionated tracts tribes wish to have 
purchased. Tribal leaders and staff have a prominent role in explaining 
the Program, and their involvement is actively and financially 
supported through cooperative agreements.
    We have expanded our national outreach given that landowners on the 
Pine Ridge Reservation resided in all 50 states as well as Canada, 
Germany, England, Italy, Qatar, Taiwan and the Philippines. Outreach 
has occurred at on-reservation and regional events across the country. 
Program staff regularly attends national and regional tribal events to 
meet with landowners and distribute informational materials. Outreach 
also includes key leadership from the Secretary's staff. As previously 
mentioned, I recently hosted a Listening Session in Portland, Oregon to 
share information and hear directly from Indian Country.
    Public service announcements from Departmental and tribal leaders 
have been disseminated to tribal and local radio stations, and aired in 
partnership with the Indian Health Service. Each landowner receives a 
minimum of two postcards for each offer and materials and information 
are regularly updated on our website, which also includes an online 
Outreach Toolkit to help tribal staff and organizations communicate 
about the Program. We are constantly seeking ways to incorporate 
feedback and improve the Buy-Back Program.
    To communicate widely, we have issued nearly 30 press releases, 
including op-eds published throughout Indian Country. Each announcement 
is distributed not only to the media, but also to each of the 150 
tribes eligible to participate in the Program as well as nearly 100 
tribal organizations to help disseminate news (such as the Indian Land 
Tenure Foundation and National Congress of American Indians). We have 
received coverage in more than 200 articles, including nearly 90 news 
outlets including the Associated Press, Indian Country Today, IndianZ, 
Native American Times, and Rapid City Journal. The Program has 
purchased advertisements in programs for national events, such as 
Gathering of Nations, and publication special editions, including 
Indian Country Today. Most recently, the Program placed advertisements 
in the Native Sun News, Lakota Country Times, Todd County Tribune, 
Mellette County News, and Bennett County Booster to highlight 
opportunities for Pine Ridge and Rosebud landowners.
V. Conclusion
    The level of interest expressed by tribes over the past year 
demonstrates the importance of the Buy-Back Program and our collective 
desire for it to be successful. Transferring millions of acres directly 
into tribes' ownership will provide countless opportunities for this 
and future generations. Restoring tribal homelands is one of our 
highest priorities and these interests are almost entirely within 
existing Indian reservations. We appreciate the Committee's interest in 
the Buy-Back Program and look forward to answering any questions.

    The Chairman. Thank you, Deputy Secretary Connor. I very 
much appreciate your testimony. Put five minutes on the clock, 
if that is okay, and we won't hold you to close to that as far 
as the questions go.
    Today we are going to hear from the Garden City Group that 
is ready to start sending out final Cobell payments, once the 
final amounts are calculated by the Department of Interior and 
approved by the court. Those are the steps that have to be 
taken.
    The Federal court has authorized final payments to proceed 
at the end of May. They made that authorization. Do you have 
any update, Deputy Secretary Connor, on how long it is going to 
take to calculate the payments?
    Mr. Connor. Overall, I think we are looking at a process 
where we will be finalizing the information necessary to make 
the calculations with a goal, I think, of early fall, be in a 
position to give the information so that the payments can be 
made. So I think we are on the same page with all the 
plaintiffs and the Garden City Group, that that is the process 
and the schedule. Right now we are doing some verifications of 
some of the information that the plaintiffs have asked us to 
do, and that process is the final step, from my perspective, in 
making the calculations necessary to make the payments.
    The Chairman. Was there a schedule laid out in the 
settlement?
    Mr. Connor. I am not familiar as to whether or not there 
was a schedule initially laid out in the settlement itself. I 
do know it has been obviously a very complicated process. Our 
role has been to i.d., the class members, find the class, well, 
create the class members and then make the calculations. So 
that has been a long, involved process.
    The Chairman. Okay. You talked about the Buy-Back program 
and some of the numbers you gave us on what has been done from 
a transaction basis. Can you describe how this process is going 
to be duplicated on other reservations? I assume that is the 
plan.
    Mr. Connor. Absolutely that is the plan. We have been very 
active on three reservations so far. We have now, as of I think 
in the last week, made purchase offers on a fourth reservation, 
Fort Belknap in Montana. So we are moving forward 
expeditiously, I think, overall. We are intending to make 
offers, significant numbers of offers on four more reservations 
by the end of the year. The bottom line, though, is that we 
need to expand this and work in parallel across a number of 
reservations, if we are going to ensure that in the ten-year 
period we expend all the available resources, which is our 
goal, to make sure we use all those resources.
    The Chairman. Right. And get the problem solved. Do you 
have the resources to be able to, currently to be able to work 
at multiple reservations at the same time?
    Mr. Connor. The capacity issue that we see from our 
perspective is really the appraisals themselves. Right now I 
think we are in a good position to be able to meet the program 
time frames. But I think to feel more comfortable than we do 
today, we are going to have to address the capacity issue that 
exists with the appraisers. So we need to hire some additional 
appraisers, and that is in the works. We are looking at our 
ability to supplement our own resources with contracted 
resources through the appraisal process.
    We are certainly making use of the existing appraisals that 
are available on a number of reservations and making use of 
tribal capacity through our cooperative agreements. That I 
think is the factor that we are most concerned about in trying 
to aggressively address. We have done a lot of mapping 
activities, we have mapped 50 reservations. We feel in a good 
position. We have shared that information with 27 or 28 tribes 
who are interested. So we are moving forward on multiple fronts 
now to allow the priority, working with tribes on their 
priority acquisitions. So we have to deal with the appraisal 
process, which I think is a first priority.
    The Chairman. Just from your assessment, honest assessment 
of where you are, do you feel good where you are right now as 
far as the Cobell settlement goes?
    Mr. Connor. I feel with the progress we have made over the 
last six months that we are in a good position. But it is going 
to take constant vigilance, and it is going to take addressing 
those resources constraints right now. Quite frankly, I feel 
better than I did when I walked into this job four months ago. 
My first two weeks I spent a lot of time on this program. I 
thought I would spend substantially more time than I have had 
to do in the last couple months. That is because I think as we 
have turned the corner, started making substantial offers, 
people see the progress being made and how the program can 
work. I think we are getting more enthusiasm and more 
participation now.
    The Chairman. You talked about the scholarship fund. You 
said there is about $3 million you have put in it so far. It 
will be capped at $60 million. Do you think that cap will be 
reached?
    Mr. Connor. Once again, I think we are in a position that 
we will be able to reach that cap.
    The Chairman. Okay. You have heard pretty caustic concerns 
from tribes that the cooperative agreement negotiation process 
is slow, if you haven't heard it, they are telling us that. And 
the tribes are more familiar with a process called the 638 
contracting process. Many tribes have advocated to Congress to 
make that change to allow 638 contracting. And in fact, there 
have been bills introduced to do exactly that.
    Can you state whether 638 contracting would make the 
program run more smoothly, or would it make things more 
difficult?
    Mr. Connor. I think there are unique factors about the Buy-
Back program that need to be considered in the context of 
looking at 638 contracting. As a threshold matter, I think more 
contracting, more actions consistent with self-determination 
and self-governance are the ways that we are going to improve 
carrying out our trust responsibilities to the tribes. So as a 
general matter, we are strong proponents of moving even further 
in that direction.
    Having said this, this is a ten-year program on which we 
are having activities on individual reservations in the 12 to 
18 month time frame with a 15 percent administrative cap on the 
indirect costs that are associated with the program. So we look 
at it as, I think if we are going to move in the direction of 
self-determination, what are we going to do about the 15 
percent cap. We have 150 reservations that are eligible for the 
Buy-Back program. Taking the 130 which have negotiated 
different self-determination contracts, the indirect cost rate 
is on average taking all those 130 reservations, 27 percent.
    So there is a difference there already. We think there are 
certain aspects of the program, and we have tried to address 
this in a cooperative agreement program, that tribes are much 
better at than ours, certainly the outreach, the priority 
planning aspects of the program. Some tribes are helping us out 
with the appraisal process. Other tribes have elected not to 
have any agreement with the Department. There are certain other 
efficiencies of scale that we have gained, certainly, in making 
the acquisitions and doing the deeds and making the offers and 
getting that in the system and transferred into trust, tribal 
trust, very quickly. It is unclear whether or not we will still 
have those efficiencies of scale if we go completely to the 
self-determination route.
    So at this point in time, in the context of considering 
those bills, those are the factors that we are going to be 
looking at if we are asked to come back and testify on any 
specific bills.
    The Chairman. Thank you. Vice Chairman Barrasso?
    Senator Barrasso. Thank you, Mr. Chairman. Just following 
up on your line of question, last December Deputy Assistant 
Secretary Roberts testified regarding the Buy-Back program, 
that some individuals never sell their interests. So 
fractionation may remain an issue on some reservations.
    Your written testimony indicated that the department has 
pursued opportunities at some of the reservations that are less 
fractionated. The efforts will then help in developing a 
comprehensive strategy for purchasing fractional interests, and 
you talked about efficiencies of scale and making the 
contracts. So the question is, can you tell us what types of 
strategies have been developed so far, how those have been 
working and what your thoughts are?
    Mr. Connor. Certainly I think the most significant strategy 
is the mass appraisal valuation process. And we work with the 
Trust Institute to ensure that the mass appraisal process was 
validated and improved, based on that interaction. So I think 
that has been the most significant strategy that has put us in 
a position to not only focus on the 40 most fractionated 
reservations, so we are in consultation with the tribes, all 
150 who are eligible wanted to ensure that we could put in 
place a process to ensure that we could work on those 
communities and work on those reservations.
    So we instituted a purchase ceiling process, where we 
assess what is likely to be the magnitude of the acquisition 
costs on the reservations, so that we could ensure that we can 
move to the maximum number of reservations. I think overall, 
through the cooperative agreement process, we have I think, 
both your statements are indicative of the problems that we 
have had in standing up the cooperative agreement process. I 
think most recently through the improvements that we have made 
in templates and setting expectations and working and 
consulting with individual tribes, I think we are expeditiously 
moving faster in developing cooperative agreements. I think we 
have seen that in the last couple months, where we have greatly 
improved our ability to move forward with tribes in 
partnership.
    So there are a lot of improvements that I think help 
address the issue that you raise.
    Senator Barrasso. Senator Tester's first question had to do 
with the Garden City Group. As Jennifer Keough, who is here, a 
witness on our next panel, indicated in her written testimony, 
that with the Cobell settlement payments not being made, that 
the Interior Department, as you said, has not really been able 
to first calculate the total amount owed. She noted it, there 
were about 239,000 individuals who have been waiting for their 
check. Is that an accurate assessment in your mind, as to the 
number, the size, the expanse of how big an issue we are facing 
here? And then I was going to ask for your thoughts on the 
realistic approach of getting that by the fall.
    Mr. Connor. I think that number that you quote sounds like 
it is in the ball park. I can certainly verify that for the 
written record, our expectations about that. I think we are in 
a realistic position to move forward in the fall with those 
payments. There has been a lot of process and there have been a 
lot of factors. We have had a role, I think the appeals 
process, who is part of that class, that that process has gone 
on in front of the special master and the court has certainly 
been a factor in the time frames. Now, certainly in the 
validation as we go back and ensure that our records are 
accurate, it has been a time-consuming process.
    Right now, we are at the tail-end of that approach. I think 
we have identified also the overall resources available for 
distribution which is a critical part of the calculation. So I 
am going to express confidence that we are going to be in a 
position to do our part, which will allow those folks who are 
responsible for the actual payments to do their part and get 
them out by this fall.
    Senator Barrasso. Thank you, Mr. Chairman.
    The Chairman. Senator Heitkamp?

               STATEMENT OF HON. HEIDI HEITKAMP, 
                 U.S. SENATOR FROM NORTH DAKOTA

    Senator Heitkamp. Thank you, Mr. Chairman.
    Just a couple of points. Obviously Mandan, Hidatsa and 
Arikara Nation is at the center of an oil boom in North Dakota. 
In fact, approximately a third of all production in North 
Dakota actually occurs on the reservation. This issue of 
fractionalization is critically important in terms of getting 
access to the surface for various reasons that you would need 
to facilitate energy development which a lot of folks are 
interested in. I think you have some folks who are very 
interested in the Buy-Back program, but they aren't going to 
sell you their minerals. Certainly not there.
    So I want to see what you are doing or hear what you are 
doing to try and prioritize those areas where economic 
development by reducing fractionalization could be a key 
outcome and what your relationship is. I know you just recently 
signed an agreement with Standing Rock, but what your 
relationship currently is with Mandan, Hidatsa and Arikara.
    Mr. Connor. I don't believe we do have a cooperative 
agreement with Fort Berthold right now. So quite frankly, I was 
up there about six weeks ago, and we had a great discussion 
about the activity, the oil and gas activity that was going on, 
the value of it, as well as the issues associated with that 
rapid pace of development. We actually did not get into much of 
a discussion on the Buy-Back program. I was surprised when I 
walked into their tribal headquarters and saw the map that was 
immediately in the foyer area, and I hadn't realized how 
fractionated and how a lot of that particular reservation had 
been.
    So I think it is one of those situations right now, and 
that is a factor in where we are looking at moving toward 
cooperative agreements and prioritizing communities that we are 
going to work with. And the 21 that we have done, it is the 
level of fractionation which certainly Fort Berthold is up 
there, it is the level of interest by the tribe, it is the 
contiguous nature with other areas, what we can do, evaluations 
that are similar and get some efficiencies of scale. And right 
now I am not quite sure where we are on their interest level.
    Senator Heitkamp. It is complicated, because a lot of what 
we need to do in order to reduce flaring, what we need to do in 
order to move product depends on having access to the surface, 
for in some ways temporary access to the surface. So 
fractionated interests makes a big difference in terms of the 
ease of actually moving forward.
    I want to talk a little bit about cooperative agreements 
and where I guess I applaud that effort and applaud the 
consultation that needs to go into those cooperative 
agreements, one of the things we hear back is that they have 
found that the negotiating process for a cooperative agreement 
is complex and can be burdensome. So I want to know what you 
are doing to improve the process so that people don't think, 
well, we will spend days and hours doing this and come back and 
nothing will happen from it, and how we can get more of these 
agreements done quicker, so that we can begin the buy-back 
process even that much faster.
    Mr. Connor. We have provided templates of our cooperative 
agreements that we have in place. The staff has had a webinar 
which I think was pretty well attended.
    Senator Heitkamp. Can you tell me, are those kind of take 
it or leave it or are those negotiable?
    Mr. Connor. They are very much negotiable. We have tried to 
set a framework of expectations. We have said that we expect 
they are going to be in the neighborhood of $500,000. Part of 
that is because we think estimate-wise, given the activities 
that we foresee being part of that cooperative agreement that 
the cost part of it is trying to stay within our 15 percent 
overall administrative cost for the program itself.
    Having said that, there is a couple of hundred thousand 
dollars either way on several of those agreements, because of 
the unique circumstances that exist on the reservations for 
which we have cooperative agreements. Any activities, some 
tribes don't want to have part of the valuation processing, I 
think we have three now who are assisting us with the appraisal 
process. So they are not cookie cutter. We have tried to set 
expectations and put a framework around it but very much open 
to a negotiation process.
    Senator Heitkamp. One final question. When you are looking 
at actually finding absentee landowners, what has been your 
experience as you look at maybe one owner wanting to sell and 
not being able to find the other three that have an interest?
    Mr. Connor. I know that for efficiency purposes, we are 
focusing on those landowners that we identify that are 
available, that we know are receiving the offer. And on the 
landowners that their whereabouts are unknown, I don't think we 
are focusing on them at this point in time as an efficiency 
measure. But I can supplement that for the record.
    Senator Heitkamp. I guess my point is, there might be one 
of these interests where you have one person who is interested 
in selling. That might be something that is critically 
important for the tribe to consolidate of the purposes of 
economic development or further build-out of tourism, whatever 
it might be. I think it is important that we don't simply hit a 
hurdle of an absentee landowner and then back away from that 
process.
    Mr. Connor. I think that is where the cooperative 
agreements and the relationships who have tribes, that the 
outreach and their priorities for acquisition, that we are 
going to rely on in focusing the resources of the program.
    Senator Heitkamp. Okay, thanks, Mike.
    The Chairman. Senator Franken?

                 STATEMENT OF HON. AL FRANKEN, 
                  U.S. SENATOR FROM MINNESOTA

    Senator Franken. Thank you, Mr. Chairman. It is good to see 
you again, Deputy Secretary Connor. I understand the need to 
prioritize the most fractionated reservations and I am glad 
that the Fond du Lac Reservation in Minnesota, that their band 
is on the list of tribes that the Department plans to focus on. 
But then I think about all these tribes that aren't on the 
list, Bois Forte, for example, their band is also in Minnesota, 
has 92 highly-fractionated tracts. I realize that is dwarfed by 
some other tribes, but 92 fractionalized tracts are a lot of 
fractionalized tracts. It is a lot of land that is extremely 
difficult to manage.
    Is there a plan to help any of these tribes that are 
outside the top 40 list?
    Mr. Connor. Absolutely. I am not sure if on the Fond du 
Lac, I am not sure Fond du Lac is on the list that we have 
right now. We will have to double check. We will clarify that.
    Senator Franken. They are in the 40. Well, okay, they are 
not expected to start this year.
    Mr. Connor. That is correct. The list we put out was for 
substantial land consolidation activities through 2015, as of 
today, or as of May when we made the announcement. So in answer 
to your question, we are not focused on just the top 40. 
Geographic diversity was one of the factors that we were 
looking at and we are looking at opportunities for lessons 
learned from some of the less fractionated reservations.
    So really right now, we are looking at capacity issues. As 
we talked a little bit about earlier, I think appraisals are 
the most significant issue with respect to capacity right now. 
We are trying to add additional appraisal capacity, whether it 
be through tribes themselves, through direct hires that we make 
or contracted resources. So what we have talked to a lot of 
tribes about is, we have significant expectations that we will 
add to that list of 21 even for activity to begin at 
significant levels through the end of 2015. So because, I don't 
know about the specific tribes you referenced, but I do know 
there is an ongoing interaction, if those tribes are 
interested. We are trying to see if we can marshal the 
resources to add them to the list of 21 and begin activity 
within this next 18 month time frame.
    Senator Franken. Okay, just clear this up. Fond du Lac is 
one of the 40. But it is not going to be addressed, I guess the 
top 21 are to be done, their work will be done by the end of 
2015. When do you expect the others to be taken up?
    Mr. Connor. I think we have about eight years left. So to 
reiterate, they are not part of the 21 right now.
    Senator Franken. Does it count if they are in the 40, when 
I could I tell Chair Karen Diver that you are going to be 
addressing the rest of the top 40?
    Mr. Connor. Well, I just got passed a note, we are having a 
meeting with the Midwest Tribes on August 5th. I think the 
dialogue is going to be about whether or not we can add some of 
those tribes into the present list to begin activity even 
before the end of 2015. Beyond that, obviously as we move 
through this process and maximizing the accomplishments for the 
resources we have, the top 40 are going to be absolutely 
critical that we ensure that we get there. I don't have a 
specific time frame for you or Karen at this point in time, but 
it is going to be a high priority overall in the program.
    Senator Franken. You talked about some lessons learned 
already. The Department has worked with just three tribes thus 
far and purchased, I think over $72 million of fractional 
interests. What lessons have you learned from this initial 
experience, from these tribes? And will that help you pick up 
the pace of doing this and do you think you will be able to 
fully implement the terms of the settlement in the window, in 
the 10-year window?
    Mr. Connor. Yes, Senator, I think we are in a good 
position. We are not in an over-confident position that we are 
going to meet the time frames, and we have a lot of work to do. 
So I think the lessons learned is that there is assistance that 
we can get from certain tribes with respect to the appraisals, 
and we are going to continue to try and maximize that 
assistance as we move forward with our cooperative agreements. 
I think we are getting in our dialogue with the tribes and 
using the aspects that they are much better suited to carry out 
the program than we are, which is that outreach and those 
priorities and identification of certain tracts. I think we are 
recognizing the value that exists there. I think we are getting 
to our cooperative agreements quicker now. So I think that we 
are positioning ourselves better so that the issue just becomes 
more and more about capacity building. That I think, the 
contracting aspect of it could be very helpful but it just 
hasn't come to fruition. We are hoping that by early this fall 
we may be able to look at substantial capacity additions to 
that mechanism.
    Senator Franken. Thank you. Thank you, Mr. Chairman.
    The Chairman. Thank you, Secretary Connor. I appreciate 
your testimony and your response to the questions here today.
    I have a few more questions that revolve around the 
Commission on Indian Trust Administration and Reform, but I 
will do those in writing to you, and any other member that has 
further questions may do the same.
    With that, I will release you. Thank you very, very much. 
We appreciate your participation in this hearing.
    Mr. Connor. Thank you, Mr. Chairman, Vice Chairman, 
Senator.
    The Chairman. Now I want to invite up witnesses to the 
second panel. We are going to hear from Carole Lankford, Vice 
Chair from the Confederated Salish and Kootenai Tribes. And we 
will hear from Susan Waukon, a member from the Ho-Chunk 
Nation's Legislature out of Wisconsin. Next we will hear from 
Mr. Helo Hancock, the Legislative Director for the Coeur 
d'Alene Tribe of Idaho. Finally, we are going to hear from Ms. 
Jennifer Keough, who is the Executive Vice President of the 
Garden City Group, which is a court-appointed administrator of 
Cobell payments.
    I want to thank you all for being here, and being willing 
to testify. We will start with you, Carol, with your testimony. 
But before you start, I want to say thank you, thank you for 
your commitment to the Salish and Kootenai people, and thank 
you for making the long trek from Montana out here. With that, 
you may begin, Carol.

         STATEMENT OF HON. CAROL LANKFORD, VICE-CHAIR, 
        CONFEDERATED SALISH AND KOOTENAI TRIBES OF THE 
                      FLATHEAD RESERVATION

    Ms. Lankford. Thank you very much. Good afternoon, Chairman 
Tester, Vice Chairman Barrasso, and Committee member Heitkamp.
    My name is Carol Lankford. I am Vice-Chair of the 
Confederated Salish and Kootenai Tribes in Montana. CSKT is a 
strong advocate of tribal self-governance and native homeland 
restoration. I am thankful that the Committee and others in 
both chambers of Congress are listening to the concerns of 
tribal leaders, respected elders and Indian communities 
regarding the land Buy-Back program.
    Our aboriginal territory was over 20 million acres. In our 
treaty of 1855, we ceded almost 19 million acres of land to the 
U.S. In return, the Federal Government gave us a commitment 
that we would have exclusive use of the remaining 1.3 million 
acre Flathead Reservation. Within 50 years, the U.S. broke its 
work and opened our reservation for non-Indian homesteading.
    By 1930, we were a minority landholder on our own 
reservation, with only 30 percent of those 1.3 million acres 
still being Indian-owned, a fact that should shock the 
conscience of every American. Today, following aggressive land 
purchase efforts led by tribal leadership, we now own 63 
percent of land within our reservation. Most of Indian Country 
greeted the fractionated interest purchase program of the 
Cobell settlement with open arms because of what a huge problem 
fractionated land created on our reservations.
    We are grateful to be one of the first tribes to enter into 
a land buy-back agreement with Interior under the settlement. 
However, given the hoops we had to jump through and the dozens 
of rewrites we had to negotiate, combined with what we are 
hearing from other tribes, we are concerned about the 
implementation of this important program. While the CSKT do 
have a signed cooperative agreement, we have yet to be able to 
purchase even one fractionated interest due to the cumbersome 
program implementation and design.
    Details regarding program implementation difficulties that 
the CSKT have encountered can be found in my written statement. 
The short version is that Interior has implemented needless 
changes and imposed unnecessary requirements without long-term 
consideration of the consequences of their actions. Interior is 
also not responding in a timely manner even when required to do 
so.
    We have a number of recommendations for legislation and 
program improvement. There are 40 tribes who have 90 percent of 
the fractionated interest. Allow them a full term of the Cobell 
settlement to acquire fractionated interests. Do not limit 
tribes to a 12 or 18 month cooperative agreement. The issue of 
fractionated interest ownership was created over decades and 
will not be resolved in 18 months.
    Allow tribes to compact or contract the land Buy-Back 
program under the Self-Determination Act and/or the Tribal 
Self-Governance Act. Allow tribes to invest the land 
acquisition fund and earn interest while managing the program 
to enable that tribes purchase more fractionated interests.
    Assist tribes to implement the land Buy-Back program of 
requested. Time and time again we have learned that tribes want 
choices and options. Some tribes may play a larger role in the 
program. Some may not. There are two bills pending in Congress 
right now intended to fix problems with the program, one by 
Senator Walsh and Congressman DeFazio and one by Congressman 
Daines. Both bills contain good provisions. Most importantly, 
both bills will allow tribes to utilize the Indian Self-
Determination Act and the Tribal Self-Determination Act to 
implement the land Buy-Back program on their reservation.
    We have confidence that Congress will choose the provisions 
from both bills that will work best into one consolidated bill. 
It will be important to enact such a bill quickly. In my 
written testimony, I have indicated that the Daines bill 
extended the period for an additional five years and thought 
this made sense. We now understand that the Walsh-DeFazio bill 
allows the money to be spent until it is gone, essentially 
extending the period of land purchase for as long as it takes 
until the money, including the investment returns, runs out. 
That is a very good idea.
    The Department of Interior has held numerous listening 
sessions around the Country. However, they have been slow the 
change the program implementation and design. The opportunity 
still exits to make the land Buy-Back program one of the most 
innovative and successful restoration programs in the 
Department of Interior's history.
    Please continue to ask tribal leaders what will improve the 
program and also engage DOI in implementing the program changes 
requested by tribal communities.
    Thank you for the opportunity to testify before the 
Committee. Your leadership and attention in this matter is 
greatly appreciated. I look forward to any questions that you 
may have.
    [The prepared statement of Ms. Lankford follows:]

  Prepared Statement of Hon. Carol Lankford, Vice-Chair, Confederated 
         Salish and Kootenai Tribes of the Flathead Reservation
    Good afternoon. I want to thank Chairman Tester for convening this 
hearing on one of the most important opportunities in Indian Country, 
namely the Department of the Interior (DOI) Land Buy Back Program 
(LBBP). My name is Carole Lankford. I am the Vice Chairman of the 
Confederated Salish and Kootenai Tribes in Western Montana. Our Tribes 
are strong advocates for Tribal Self Governance and for native homeland 
restoration.
    Perhaps to understand its importance I should quickly relay to you 
the history of our land base. Our aboriginal territory was over 20 
million acres, a significant amount of what is now western Montana and 
areas in surrounding states. In our Treaty of 1855 we ceded almost 19 
million acres of land to the U.S. in return from a commitment of the 
U.S.--in a treaty ratified by the United States Senate--that we would 
have the exclusive use of the remaining 1.3 million acre Flathead 
Reservation. Within 50 years of the signing of that treaty the US broke 
its word and opened our reservation for non-Indian homesteading. By the 
1930s we were the minority land holders on our own reservation with 
approximately 30 percent of those 1.3 million acres still being Indian 
owned. That fact should shock the conscience of every American. Today, 
following aggressive land purchase efforts by CSKT Tribal leaders, we 
now own approximately 63 percent of the land within the Flathead 
Reservation. So today, being before you, I am thankful that Montana's 
Congressional Delegation is listening to the concerns of Tribal 
leaders, respected elders and the Indian community in regard to the 
Land Buy Back Program.
    Most of Indian Country celebrated when the Cobell lawsuit was 
settled and finalized. As the members of this Committee know, due to 
the allotting of Indian reservations and the many times whereby 
allotments have divided and subdivided further and further for each 
generation of descendants of the original Indian allotment holders, 
there are large parts of reservation lands with fractionated parcels 
that cannot be used for home building or economic developments. 
Therefore, most of the Tribal Nations greeted the fractionated interest 
purchase program of the larger Cobell Settlement with open arms.
    We are grateful to be one of the first tribes to enter into a land 
buy back agreement with the Department of the Interior under the Cobell 
settlement. However, given the hoops we had to jump through and the 
dozens of rewrites we had to negotiate, combined with what we are 
hearing from other tribes, we are concerned that the implementation of 
this important program will not achieve the intended result, which is 
to reduce the number of fractionated interests.
    While the CSKT do have a signed cooperative agreement for Land Buy 
Back, we have yet to be able to purchase one fractioned interest. We 
believe this is due to cumbersome program implementation and design.
    Some of the program implementation errors that the CSKT are 
experiencing are as follows:

        1.)  Encouraging time limited Cooperative Agreements with a 
        limited number of purchase offers. It can take up to six months 
        to achieve a standard mortgage from start to finish. Yet, 
        Indian land owners are asked to make a decision to sell trust 
        interests in a 45 day period. This short window for 
        decisionmaking will not encourage sales to the Tribal 
        government. This short window does not honor nor acknowledge 
        the Tribal attachment to Indian land. This ``critical 
        decision'' in creating such a short timeframe for willing 
        sellers to make a decision to sell, may have a detrimental and 
        irreversible negative impact on the program. We have been told 
        that the 45 day timeframe for making a purchase decision will 
        be modified, if necessary. That probably is a good idea. We 
        have only 11 months left on our cooperative agreement and are 
        limited to three purchase offers or what DOI calls waves 
        (groups of purchase offers). We are concerned that this 
        grouping especially on a reservation like ours where lakeside 
        land will be valued much higher than elsewhere is going to be 
        problematic. Interior wants to get in and get out, do 
        appraisals only once, and offer all sales prices at once. It is 
        not going to work.

        2.)  Why would the DOI modify the appraisal process for Land 
        Buy Back? Our Tribes are experiencing more delay, new 
        reviewers, new required appraisal language, and new 
        requirements for appraisals. The validity of the appraisal (or 
        appraisal age) should be lengthened if local market conditions 
        support it. Instead, the DOI initiated the Land Buy Back 
        program with a new ``shortened'' shelf life for appraisals. We 
        and other Tribal leaders have expressed this concern over 
        shortened appraisal shelf life to the Department of the 
        Interior numerous times.

        3.)  The CSKT were faced with a requirement for BLM mapping of 
        fractionated interests. This would be a requirement of the 
        appraisal and of the determination that a fractionated interest 
        was purchasable. This has never been a requirement for past 
        fractionated purchases under the Indian Land Consolidation Act. 
        Why impose new or changed standards now? The program is 
        cumbersome enough without layering new requirements on the 
        process and on Tribal governments. Even after just meeting with 
        DOI reps we are not sure if the failure to have a BLM map would 
        prevent the acquisition of a Tribal priority interest. BLM 
        rarely comes out to the reservation and they rely on other data 
        such as TAMS. If TAMS info conflicts with BLM data and BLM will 
        not then issue a map, a priority acquisition might go by the 
        wayside. That would be very troubling.

        4.)  We are the only tribe with a provision in our agreement 
        requiring the review appraisers to review an appraisal and 
        respond within five days. We have sent over 60 appraisals to 
        them and they never got back to us on a timely basis so now we 
        have to update the appraisals. They can't keep up with their 
        own agreed to timeframes.

Recommendations
    Our recommendations for legislation and program improvement are as 
follows:

   There are forty (40) Tribes identified by the DOI who have 
        90 percent of all fractionated interests in Indian Country. 
        Allow them the full term of the Cobell settlement to acquire 
        fractionated interests. Do not limit Tribes to a 12 or 18 month 
        Cooperative Agreement. The issue of fractionated interest 
        ownership was created over decades and it will not be resolved 
        in 18 months. Allow participating Tribes, at the least, the 
        full settlement period to purchase fractionated interests with 
        the initial purchase ceilings ($) allocated to them. This is 
        reasonable if a long term solution and true reduction of 
        fractionated interests is desired.

   Pass legislation to allow Tribes to compact the Land Buy 
        Back Program under the Indian Self Determination Act and/or the 
        Tribal Self-Governance Act.

   Allow Tribes to contract or compact the Land Buy Back 
        Program.

   Allow Tribes to invest the land acquisition funds while 
        managing the program to enable the Tribes to purchase more 
        fractionated interests. The CSKT believe that our initial 
        purchase ceiling will not be sufficient if all willing sellers 
        decide to sell. We should be able to invest the funds and earn 
        interest and then use that to purchase more fractionated 
        interests during the program. That is also reasonable and a 
        business approach to the problem.

   Assist Tribes to implement the Land Buy Back program if 
        requested. Time and time again we have learned that Tribes want 
        choices and options. Some Tribes may play a larger role in this 
        program. Some may not. There is a slim chance that the funds 
        will be spent if the program implementation is narrow, as it 
        presently is. We support spending the funds and restoring the 
        fractionated interests to the control of the Tribes.

    There are two bills pending in the Congress right now intended to 
fix problems with the Land Buy Back program. One by Senator Walsh and 
Congressman DeFazio and one by Congressman Daines. Both bills contain 
good provisions. Most importantly, both bills will allow tribes to 
utilize the Indian Self-Determination Act and the Tribal Self-
Governance Act to implement a land buy-back program on their 
reservation. The Daines bill extends the time period for the 
implementation of the land buy-back program from 10 to 15 years. It 
also allows payments to be made to tribal governments to carry out 
contracts or compacts and authorizes the use of interest earned on such 
payments to be used by the tribal government to purchase fractionated 
interests. It further requires annual reports to Congress (which might 
be a good way to hold Interior accountable) and consultation. The 
DeFazio-Walsh bill allows investment of the trust land consolidation 
funds in an interest bearing account and also contains a provision 
whereby the funds are invested by the Secretary and then tribes can use 
them to purchase fractionated interests until they are gone. While 
DeFazio-Walsh does not explicitly strike the 10-year availability 
limitation language it does away with the availability limitation 
timeframe entirely by specifying that the funds must be invested into 
an interest-bearing account and that once invested can only be used for 
the intended purpose (without any timeframe limitation). On the one 
hand we would not wish to see further delays by Interior if they are 
not forced to act within a specified timeframe but on the other hand 
extending the timeframe to 15 years in the Daines bill does not ensure 
that funds would not revert to the Treasury if they have not been fully 
expended. DeFazio-Walsh says the funds can only be used for the 
intended program and will not be returned to the Treasury. The notion 
of any of these funds possibly reverting to Treasury is counter to the 
purpose of the Fund and preventing that possibility would be a good 
idea.
    Senator Tester and Committee Members we commend you for listening 
to Tribal leaders.
    The DOI has held numerous listening sessions around the Country and 
we believe their consultation has been extensive. However, they have 
been slow to change the program implementation and design. There is 
still time to make the Land Buy Back Program one of the most innovative 
and successful land restoration programs in DOI history.
    Please continue to ask Tribal leaders what will improve the 
program. Engage the DOI in implementing program changes requested by 
the Tribal communities. We have confidence that the Congress can pick 
and choose the provisions from both bills that will work best into one 
consolidated bill. It will be important to enact such a bill quickly.
    Thank you.

    The Chairman. Thank you, Carol. We appreciate your 
testimony.
    Susan Waukon, you may have the floor.

        STATEMENT OF HON. SUSAN WAUKON, REPRESENTATIVE, 
          HO-CHUNK NATION LEGISLATURE; ACCOMPANIED BY 
            GEORGE WATERS, PRESIDENT, GEORGE WATERS 
                       CONSULTING SERVCIE

    Ms. Waukon. Good afternoon, Chairman Tester, Vice Chairman 
Barrasso and members of the Committee. My name is Susan Waukon 
and I am a District 1 legislator from the Ho-Chunk Nation of 
Wisconsin. I represent most of the northern half of Wisconsin. 
I appreciate the opportunity to provide testimony on behalf of 
the Nation on Improving the Trust System in the Department of 
the Interior's land Buy-Back program.
    The Nation's tribal enrollment is 7,500 members and our 
tribal headquarters is in Blackwater Falls, Wisconsin. A series 
of Federal actions reduced our land base from 10.5 million 
acres to 11,538 acres, located throughout 25 counties in 
Wisconsin, Illinois and Minnesota.
    The nation participated in the Indian Land Consolidation 
Program, the predecessor to the Buy-Back program. In 2009, the 
nation adopted a land consolidation code to prioritize the 
nation's land acquisitions. The nation has also developed a 
probate code, assumed responsibility for the land title records 
office and is in the process of assuming control over surface 
leasing under the recently-enacted HEARTH Act.
    The nation is listed as 65th in the program's 
implementation plan and is about to finalize a cooperative 
agreement to participate in the program. Based on our 
experience and discussion with the Department, the nation 
recommends the following changes to improve the program.
    One, develop rules for reallocation of purchase ceilings. 
The rate of acceptance for offers made is now about 30 percent. 
Even if the rate were to jump to 40 or 50 percent, this would 
still leave hundreds of millions of dollars in need of 
reallocation.
    The nation strongly recommends that the program develop and 
publicize guidelines for reallocation of purchase ceiling funds 
as soon as possible. Two, authorize tribes to contract program 
functions and invest program funds. We as Indian tribes should 
be allowed the option to manage program funds under the Indian 
Self-Determination Act. This would also allow the funds to be 
invested to earn interest, thereby enlarging the amount of 
funds to be used for land purchases.
    Legislation has been introduced in the House and in the 
Senate addressing tribal contracting of the program. But there 
are major differences in these bills, and the nation urges the 
Committee to work with the House Subcommittee on Indian and 
Alaska Native Affairs to find the fastest way to ensure these 
changes are enacted into law.
    Three, deploy additional resources to engage with those 
tribes that are not on the top 40 list. Other tribes that are 
not in the top 40, like the Nation, have the managerial 
capacity to begin making offers to landowners. At the end of 
the program's effective life, success will be measured by the 
total number of fractionated interests purchased and the total 
amount of acreage reconsolidated in tribal ownership.
    I don't have to remind anyone here that in all likelihood, 
this is our last chance, both at the Federal level and in 
Indian Country, to make a major dent in Indian land 
fractionation. We need to make sure that we make the most out 
of this opportunity.
    The nation believes Indian tribes can do a better job than 
the U.S. Government in managing land and natural resources. The 
nation is one of a small number of tribes nationwide and the 
first in our region to contract the Bureau of Indian Affairs 
LTRO under the ISDEAA, which has allowed the nation to access 
the TAAMS system and generic title status reports without 
having to rely on the BIA.
    Performing the LTRO function also allows the nation to 
approve leases, permits and process land acquisitions more 
quickly than relying on the BIA. The nation is also underway in 
assuming control over surface leasing under the recently-
enacted HEARTH Act, which will expedite the approvals formally 
required of the Federal Government. Reducing the Federal 
bureaucracy in these areas will allow the nation to move more 
quickly on economic development opportunities that will in turn 
enhance the quality of life for our members.
    We encourage the Committee to pursue proposals that have 
practical benefits to tribes such as S. 165, the Indian Trust 
Asset Reform Act, which would give tribes a direct role in the 
management of their trust resources and transition the Office 
of the Special Trustee functions under a single administrative 
umbrella.
    The nation strongly supports this bill and urges the 
Committee to expedite its consideration of the bill in the 
remaining months of the 113th Congress.
    This concludes my testimony. I would be happy to answer any 
questions.
    [The prepared statement of Ms. Waukon follows:]

   Prepared Statement of Hon. Susan Waukon, Representative, Ho-Chunk 
                           Nation Legislature
Introduction
    Good afternoon, Chairman Tester, Vice Chairman Barrasso, and 
members of the Committee. My name is Susan Waukon and I am pleased to 
provide this testimony on behalf of the Ho-Chunk Nation of Wisconsin 
(``Nation'') on improving the trust system and the Department of the 
Interior's Land Buy-Back Program (``Buy-Back Program''). I serve as an 
elected member of the Nation's Legislature and represent District 1, 
which includes most of the northern half of the State of Wisconsin.
    The Nation, known as ``People of the Big Voice,'' has a tribal 
enrollment of 7,500 members and our tribal headquarters is located in 
Black River Falls, Wisconsin. Forced removals and land cession treaties 
with the federal government greatly reduced what was once more than 
10.5 million acres of the Nation's aboriginal land. The Nation today 
owns approximately 11,538 acres of land situated throughout 25 counties 
in the states of Wisconsin, Minnesota, and Illinois. Using its own 
funds, the Nation purchased approximately half of this land.
    The Nation has a long history of reacquiring land and purchasing 
fractionated interests in land. For several years, the Nation 
participated in the Indian Land Consolidation Program, which was the 
predecessor to the Buy-Back Program and based in Ashland, Wisconsin. In 
2009, the Nation formally enacted a land consolidation code that 
prioritizes the Nation's land acquisitions. The Nation has also 
developed a tribal probate code, has assumed responsibility for the 
Land Title Records Office, and is in the process of assuming control 
over surface leasing under the recently-enacted HEARTH Act.
    The Nation is listed as 65th in the Buy-Back Program's 
implementation plan. The Nation is currently developing a cooperative 
agreement to formally participate in the Buy-Back Program.
Recommendations for the Buy-Back Program
    Based on our preparations and work with the Buy-Back Program to 
date, the Nation has several recommendations to improve the program.
1. Develop Rules for Reallocation of Purchase Ceilings
    To date, the Buy-Back Program has focused most of its resources on 
those tribes with the largest purchase allocations under the program's 
implementation plan. The Nation agrees that those tribes with the 
highest rates of fractionation should benefit from early deployment of 
program resources.
    The Nation is very concerned, however, that unless the Buy-Back 
Program quickly develops and implements rules governing the 
reallocation of purchase ceiling funds, much of the land consolidation 
fund will revert back to the U.S. Treasury and will be forever lost to 
Indian country. Four years into implementation, the Nation understands 
that of the offers that have been extended on the reservations where 
the Buy-Back Program is active, the acceptance rate has been 
approximately 30 percent. This acceptance rate may increase as the 
program learns more and becomes more efficient, but we believe a sense 
of urgency needs to accompany future efforts.
    Even if the acceptance rate were to eventually increase to 40 or 50 
percent, this would still leave hundreds of millions of dollars in need 
of reallocation to other tribes. It would not be feasible to reallocate 
these funds near the end of the ten year life of the program. Rather, 
Buy-Back Program managers need to make these decisions much sooner to 
afford the recipients of reallocated funds a meaningful opportunity to 
spend the money.
    If the current acceptance rate of offers holds, it is conceivable 
that land purchase funds may need to be reallocated more than once. For 
all of these reasons, the Nation strongly recommends that the Buy-Back 
Program develop and publicize guidelines for reallocation of purchase 
ceiling funds as soon as possible.
2. Authorize Tribes to Contract Buy-Back Program Functions and Invest 
        Program Funds
    The Buy-Back Program is governed by the Indian Land Consolidation 
Act (ILCA), and the ILCA does not allow tribes to contract program 
functions under the Indian Self-Determination and Education Assistance 
Act (ISDEAA). With the support of tribal organizations, Vice-Chairman 
Barrasso sought to amend the Cobell settlement in 2010 to authorize 
tribes to use contract and compacts under the ISDEAA to manage the Buy-
Back Program. At that time, however, the Administration opposed any 
change to the settlement and specifically opposed allowing tribes to 
contract the program.
    Equally important, for the ten year duration of the program, the 
$1.9 billion appropriated for the Buy-Back Program will sit in a non-
interest bearing account and gain no value over time. Had the ISDEAA 
changes been incorporated when Congress ratified the Cobell settlement, 
this would not be an issue because the ISDEAA allows funds for 
contracted or compacted programs to be transferred directly to tribes, 
at which point the tribes can invest the funds themselves. Every fiscal 
year that goes by without this money being invested represents money 
and opportunity lost.
    Ideally, the Buy-Back Program would transfer the full amount of the 
Nation's purchase ceiling amount (approximately $1.2 million) to the 
Nation and let us administer the program functions and invest the 
funds. If the Buy-Back Program followed this model for all tribes that 
have purchase ceiling allocations and wish to enter contracts and 
compacts with the department, the program would know much earlier those 
tribes that have higher rates of offer acceptance and those where 
acceptance rates are low. This would allow for a more equitable and 
efficient reallocation process--i.e., directing the Buy-Back Program 
funds where the funds are most likely to be spent.
    Legislation has been introduced in both the House (H.R. 5020) and 
the Senate (S. 2387) that addresses tribal contracting of the Buy-Back 
Program under the ISDEAA and investment of Buy-Back funds. There are 
key differences in these bills and the Nation urges this Committee to 
work with the House Subcommittee on Indian and Alaska Native Affairs to 
find the fastest way to ensure these changes are enacted into law.
3. Deploy Additional Resources to Engage with Those Tribes that are not 
        on the Top 40 List
    The Nation understands the Buy-Back Program's desire to initially 
work with those tribes with the largest purchase ceiling allocations. 
Other tribes that are not in the top 40, however, certainly have the 
managerial capacity to begin making offers to landowners immediately or 
with little administrative preparation. At the end of the Buy-Back 
Program's effective life, success will be measured by the total number 
of fractionated interests purchased and the total amount of acreage re-
consolidated in tribal ownership.
    In interactions with the Buy-Back Program, the Nation has struggled 
to get answers to questions as the program staff's time seemed focused 
on the largest tribes. The Nation recommends that the program make 
additional resources available to work with those tribes, like the 
Nation, that are not on the top 40 list.
Forward-Looking Trust Reform
    The Nation is a strong proponent of tribes having direct control 
over their resources and minimizing federal bureaucracy in tribal 
decisionmaking, especially on matters relating to the Nation's trust 
lands.
    For example, the Nation is one of a small number of tribes 
nationwide and the first in our region that have contracted the BIA's 
Land Title Records Office (LTRO) under the ISDEAA. Contracting the LTRO 
function has allowed the Nation to access the TAAMS system and generate 
title status reports without having to rely on the BIA's Regional 
Office. Performing the LTRO function also allows the Nation to approve 
leases, permits, and process land acquisitions more quickly than 
relying on the BIA.
    Assuming these functions, in tandem with the Nation's planned 
assumption of surface leasing authority under the recently-enacted 
HEARTH Act, will facilitate and expedite land-related approvals 
formerly performed by the Federal Government. The Nation has also 
submitted tribal leasing regulations to implement the HEARTH Act to the 
BIA but, ironically, the 120 day window for the BIA to act on the 
regulations has passed, and the Nation has yet to hear any response 
from that agency. Nonetheless, the Nation is hopeful that its tribal 
regulations will be approved soon so that it can further expedite 
leases of its tribal lands. Reducing the federal bureaucracy in these 
areas will allow the Nation to move more quickly on economic 
development opportunities that will, in turn, enhance the quality of 
life for the Nation's members.
    As the Committee continues its oversight of the Buy-Back Program 
and considers reforms to federal trust functions, we encourage the 
Committee to pursue proposals that have practical, tangible impacts on 
tribal communities and that will reduce federal bureaucracy. One such 
proposal is S.165, the Indian Trust Asset Reform Act, which would give 
tribes a direct role in the management of their trust resources and 
transition Office of the Special Trustee functions under a single 
administrative umbrella. The Nation strongly supports this bill and 
urges the Committee to expedite its consideration of the bill in the 
remaining months of the 113th Congress.
    This concludes my testimony. At this time, I would be happy to 
answer any questions.

    The Chairman. Thank you, Susan. There will be questions 
when we get all done.
    Mr. Helo Hancock, from our friends to the west in Coeur 
d'Alene country. You are up.

STATEMENT OF HELO HANCOCK, LEGISLATIVE DIRECTOR, COEUR D'ALENE 
                             TRIBE

    Mr. Hancock. Thank you, Chairman Tester and Vice Chairman 
Barrasso and Senator Heitkamp. I appreciate the opportunity to 
be before you today.
    My name is Helo Hancock. I am the Legislative Director for 
the Coeur d'Alene Tribe in beautiful northern Idaho. I know the 
chairman is familiar with the area.
    The Coeur d'Alene Tribe is not on the list of 40 of the 
highly most fractionated tribes. We were one of the few tribes, 
one of the first tribes to enter into a cooperative agreement 
with the Bureau in the Buy-Back program. The tribe has a fairly 
robust information data base of landowners on the reservation, 
along with a very detailed plan. We are carrying out our 
outreach efforts now. We are waiting for the appraisals to come 
back, hopefully later this month and shortly thereafter the 
offers will go out.
    Right now all signs point to a fairly quick exhaustion of 
our allocation. One of the things we wanted to ask the 
Committee today was to investigate further some of the 
proposals that were mentioned in earlier testimony about 
investing the funds that are sitting there right now not 
earning any interest that could be used to purchase more 
fractionated interests. And also to consider what a 
reallocation would look like, because there are certainly, as 
raised by Senator Heitkamp, some tribes may not be interested 
in selling. And it would be a travesty for that money to 
disappear and not be used.
    The second thing I would like to talk to the Committee 
today about is S. 165, which is the Indian Trust Asset Reform 
Act that was introduced in this Committee by Senator Crapo in 
the 112th and also the 113th. S. 165 is a cost-savings bill 
that would increase efficiency and allow tribes to manage their 
own trust assets. The bill largely originated in the 109th 
Congress, was co-sponsored by then-Chairman McCain and Vice 
Chairman Dorgan. It was S. 1439. Two of the substantive 
provisions in this bill are taken basically directly from that 
bill.
    The bill does two major things. First and foremost, it 
creates a demonstration project that would allow tribes to put 
together a trust asset management plan that would be uniquely 
curtailed or tailored to their interests, to the goals of each 
reservation and the assets they manage on their reservation.
    A good example would be, for example, in our neck of the 
woods, timber. Currently tribes are required to use the BIA 
management plan for when to harvest timber and where to harvest 
and how to harvest, how often. A plan could easily be tailored 
to the unique concerns of a reservation that may want to 
designate some areas as a tribal wilderness area, or not 
harvest, because of the markets or not harvest as much for 
certain reasons. This would give tribes the flexibility to 
manage those types of assets. What a better way to encourage 
self-determination than to allow tribes to manage their own 
affairs.
    The second thing this bill does, as previously mentioned, 
would sunset OST, the Office of Special Trustee, which was 
created in 1994 as a temporary agency to address some of the 
issue with Cobell. And the agency has grown exponentially since 
then. We are not here to say that everything OST does is bad or 
should be eliminated because it is not. There are certain 
functions that should be carried on and could easily be 
transferred back into BIA and remain. The bill provides for 
that. It is laid out in Title 3 of the bill.
    We talk about some of the duplicative functions that happen 
within BIA and OST and a great example would be the appraisals. 
Indian tribes can't do their own appraisals in many cases, so 
they request them from BIA. Well, BIA can't do the appraisal, 
they have to request it from OST. And when we don't hear back, 
we contact one of them, they will blame it on the other. You 
can sort of see the dog chasing the tail.
    This would also provide for some cost-savings and 
contemplates the Intertribal Interior Budget Council on where 
to recommend those cost savings go as those functions are 
transferred back within one single line of authority. That bill 
was developed in Indian Country largely by Committee staff that 
traveled the Country to get input from tribal leaders. It was 
developed, as I said, in Indian Country by tribal leaders. We 
would ask this Committee to look closely at moving that 
forward.
    I will stand for any questions.
    [The prepared statement of Mr. Stensgar follows:]

  Prepared Statement of Hon. Ernest L. Stensgar, Vice-Chairman, Coeur 
                             d'Alene Tribe
    Good afternoon Chairman Tester, Ranking Member Barrasso, and 
members of the Committee. My name is Ernest Stensgar and I am 
testifying today in my capacity as Vice-Chairman of the Coeur d'Alene 
Tribe (``Tribe'') and also on behalf of the Affiliated Tribes of 
Northwest Indians (``ATNI'') as Chair of ATNI's Trust Reform Committee. 
I am pleased to provide an update of the Coeur d'Alene Tribe's 
implementation of the Land Buy Back Program (``Program'') as well as my 
Tribe's and ATNI's view on trust reform--in particular, our strong 
support for S. 165, the Indian Trust Asset Reform Act.
Coeur d'Alene Tribe's Implementation of the Land Buy Back Program
    The Department of the Interior awarded the Coeur d'Alene Tribe a 
Cooperative Agreement to complete certain tasks related to the Buy-Back 
Program on April 30, 2014. Under those terms, the Tribe agreed to 
conduct outreach for the Program on behalf for the Program since the 
parties agreed that the Tribe was best positioned to communicate with 
trust landowners about the benefits of the Program. The Tribe and the 
Program also agreed that we needed to have the flexibility to tailor 
our outreach efforts to the unique characteristics of the landowners on 
our reservation.
    Coeur d'Alene Tribal staff designed its outreach plan to build upon 
existing communication with the large group of landowners who receive 
annual crop income and who frequently contact the Tribe's Land Services 
Program for information. As a result, the Tribe has reliable contact 
information for the vast majority of landowners, as well as a long list 
of willing sellers. The Tribe's goal from outreach efforts is to locate 
landowners, confirm contact information, communicate Buy-Back Program 
information and goals, and determine which landowners wish to sell 
their land interests.
    Landowner response to the initial outreach effort has been very 
positive and early indications point to rapid exhaustion of the initial 
purchase ceiling allocation of $4.1 million. To date, the Tribe has 
hosted four landowner information meetings on-reservation, appeared at 
two off-reservation events, sent mailings to every landowner, posted 
advertisements in Tribal and local newspapers and fielded over a 
hundred personal inquiries as a result of initial outreach efforts. The 
Department has indicated that appraisals will be completed by the end 
of July, at which time the Tribe will amplify efforts to communicate 
with landowners and determine which landowners truly wish to sell their 
interests with a known value in hand.
    The Coeur d'Alene Tribe has consistently emphasized the importance 
of eliminating fractionation and increasing Tribal ownership interests 
on the Coeur d'Alene Reservation. Most of the fractionated parcels that 
the Tribe is targeting produce income under crop-share leases, which 
are a particular kind of agriculture lease where the beneficial owners 
have the ability to maximize their income by selling crops when the 
price is highest. Crop share revenue represents the largest source of 
natural resource income for the Tribe. These leases are also difficult 
to administer, so in addition to increasing income for the Tribe, the 
Department will also be relieved of additional administrative burdens.
    The Tribe applauds the efforts of the Department in selecting the 
Coeur d'Alene Tribe as one of the first Tribes to participate in the 
Buy-Back Program. As the Committee continues to monitor the Buy-Back 
program, the Tribe recommends that the Committee work to ensure that 
Indian tribes have the ability to invest the Program funds allocated to 
them to maximize the number of fractionated interests that can be 
purchased. The Tribe has provided testimony on this issue to the House 
and Senate Appropriations Committees. We also request that the Program 
provide opportunities for tribes to apply for any unused Program funds.
Forward Looking Trust Reform: ATNI and Its History on Trust Reform 
        Issues and S. 165
    As the Committee is aware, when the Cobell settlement was unveiled 
in late 2009, then-Secretary Ken Salazar issued a Secretarial Order 
creating the Secretarial Commission on Indian Trust Administration and 
Reform (CITAR). Last December, the CITAR finished its work and made a 
number of findings and recommendations--some of which are, in the 
CITAR's own characterization, ``sweeping'' and would require 
congressional action. For example, the CITAR's central recommendation 
is to remove Indian trust related decisions and authority from the 
Assistant Secretary--Indian Affairs (and other agencies), and turn 
those over to a newly created, multi-member commission situated within 
the Department whose members would be subject to Senate confirmation.
    Other, more modest CITAR recommendations could be implemented 
immediately, such as having the Department utilize existing 
administrative authorities to allow tribes to waive appraisals and 
valuations. At its June 2014 mid-year conference, the National Congress 
of American Indians enacted Resolution #ANC-14-051, which noted that 
the CITAR recommendations require ``further study, review and 
discussion within Indian Country.''
    Prior to the CITAR issuing its report, ATNI, through its Trust 
Reform Committee, developed S. 165, the Indian Trust Asset Reform Act, 
which is pending before this Committee. S. 165 addresses two concepts 
that were developed by Indian country and have enjoyed widespread 
support in subsequent years: giving tribes more direct control over 
their trust assets and transitioning the Office of the Special Trustee 
(OST) to a new Under Secretary for Indian Affairs.
    Compared to some of the CITAR recommendations, S. 165 is a modest 
proposal that is intended to provide tribal governments with new asset 
management authority and relief from bureaucratic inefficiency. ATNI 
not only intended for S. 165 to provide practical, on-the-ground 
change, but also to be legislation that could be enacted into law in 
the current political climate.
    For more than a decade, ATNI and its member tribes in the Pacific 
Northwest have been active proponents of forward-looking trust reform. 
Founded in 1953, ATNI represents 57 tribal governments from Oregon, 
Idaho, Washington, southeast Alaska, northern California and Montana. 
ATNI's support and interest in these issues has been and is grounded in 
our commitment to maintaining the integrity of the United States' trust 
responsibility, the foundation of which is based upon the historical 
cession of millions of acres of ancestral lands by the tribes. It is 
also based on our recognition that in nearly every instance, Indian 
tribes have demonstrated that they are in a better position to manage 
their affairs than the Federal Government.
    Most of the text of S. 165 originated from S. 1439 and its House 
companion bill, H.R. 4322, which were introduced in the 109th Congress. 
Those bills were introduced and co-sponsored by the respective 
committee chairmen and ranking members of the House Natural Resources 
Committee and the Senate Committee on Indian Affairs. Then-Chairman 
John McCain and Vice-Chairman Byron Dorgan sponsored the legislation in 
the Senate. Following introduction, staff from the committees of 
jurisdiction in both chambers travelled across the United States to 
consult with Indian country on the legislation. The committees then 
generated a revised version of S. 1439 to reflect Indian country's 
input. ATNI testified in favor of the bill at a joint hearing of the 
House Natural Resources Committee and the Senate Committee on Indian 
Affairs on March 1, 2006. Although S. 1439 was not enacted, ATNI 
continued to promote the bill and its concepts in subsequent years.
    The announcement of the Cobell settlement in late 2009 consumed 
much of the attention and energy in Indian country on forward-looking 
trust reform. Once Congress ratified the Cobell settlement in 2010, 
however, ATNI's Trust Reform Committee refocused its efforts to advance 
the concepts in S. 1439.
    Using the committees' revised draft of S. 1439 as a template, ATNI 
focused on updating the two titles of that bill that remained relevant 
in light of the Cobell settlement and that had universal tribal 
support: title III, the Indian Trust Asset Demonstration Project, and 
title V, Restructuring the OST.
    Passage of the Cobell settlement and other considerations preempted 
the need for the other titles of S. 1439. For example, title II of S. 
1439 would have created a commission to make recommendations on Indian 
trust policies and regulations. The CITAR was charged with a similar, 
if not broader, mission. To include yet another commission in the bill 
seemed duplicative in light of the CITAR, especially since Indian 
country has long known the challenges to reforming the trust system and 
sought practical, on-the-ground solutions.
    As introduced, S. 165 represents the culmination of these efforts. 
Several individuals and tribal leaders who participated in developing 
S. 165 had previous careers working for the BIA and OST and were able 
to provide practical input to guide our efforts. ATNI is 
extraordinarily proud of S. 165 and is grateful for the Committee 
holding today's hearing.
Overview of S. 165
    The substantive provisions of S. 165 are in titles II and III, 
which are discussed below:
Indian Trust Asset Demonstration Project
    Title II would establish a demonstration project to authorize 
Indian tribes, on a voluntary basis, to direct the management of their 
non-monetary trust resources through negotiated agreements with the 
Secretary. To participate, tribes would submit to the Secretary of the 
Interior (``Secretary'') a proposed Indian trust asset management plan 
that must describe, among other criteria, the trust assets that will be 
subject to the plan, the tribe's management objectives and priorities 
for assets subject to the plan, and a proposed allocation of funding 
for the proposed management activities.
    In addition to other enumerated criteria, the Secretary may not 
approve a proposed plan unless it is consistent with federal law 
applicable to the management of the trust assets. After an Indian tribe 
submits a proposed plan, the Secretary must approve or disapprove it 
within 120 days.
    Unlike existing authorities that authorize tribes to contract or 
compact federal functions under federal standards, this demonstration 
project is unique in that it would provide participating tribes the 
freedom to determine how their resources will be managed under tribal 
standards.
    For example, an Indian tribe with timber resources that seeks to 
participate in the demonstration project could submit a plan that would 
direct that some of its forest land be managed in a manner to maximize 
fair market value on timber sales. The plan might also direct that 
other forested areas not be harvested at all to encourage tourism or 
promote certain wildlife habitat. Currently, the BIA is the final 
decision-maker on these issues. If enacted into law, tribes for the 
first time would have the flexibility to dictate these management 
standards under this demonstration project authority.
    As the example above illustrates, this demonstration project 
authority would open new doors for Indian tribes to generate on-
reservation economic development using their existing resources, 
whether those resources are timber, agriculture, or even traditional 
energy.
    Empowering tribes to create value with their own resources 
epitomizes the federal policy of self-determination. In an era where 
federal appropriations for management of tribal natural resources are 
declining and yet represent a fraction of the actual need, this 
demonstration project is a practical tool that tribes will utilize 
immediately.
Restructuring of the Office of the Special Trustee
    Congress created OST in 1994 as part of the American Indian Trust 
Fund Management Reform Act. That Act provided that OST would be a 
temporary entity to oversee certain financial reforms of Indian trust 
funds at the Department of the Interior (DOI). The 1994 Act provided 
that OST would be headed by the Special Trustee for American Indians, a 
position appointed by the President and confirmed by the Senate. That 
position has been vacant since 2009.
    Since the establishment of OST, management of Indian trust assets 
in DOI has been bifurcated: the BIA manages Indian trust land and non-
monetary trust resources, while OST manages Indian trust funds. 
Although both entities are within DOI, they are completely separate 
bureaucracies. Even though their work often overlaps, OST employees do 
not have authority over BIA employees, and vice versa. Prior to OST's 
creation, management of trust land and trust funds was under a single 
administrative umbrella.
    OST completed implementing the major reforms it was charged with 
implementing years ago. Since it was established, OST's role has 
expanded significantly to include activities far beyond managing Indian 
trust funds and implementing financial reforms.
    For example, in 2002 OST assumed responsibility for appraising 
Indian trust land and trust property, even though this function has 
nothing to do with trust funds. In the report accompanying the FY 2010 
Interior, Environment and Related Agencies spending bill, the House 
Appropriations Committee said the following about OST's involvement in 
the appraisal process:

         Indian Tribes routinely experience lengthy delays in obtaining 
        appraisals from the Department for transactions involving the 
        conveyance of Indian trust lands. The Bureau of Indian Affairs 
        is responsible for requesting appraisals and the Office of the 
        Special Trustee is responsible for procuring the appraisals. 
        Appraisals are required for Indian Tribes and individual 
        Indians to sell, acquire or exchange interests in trust land. 
        Delays in obtaining appraisals also delay these transactions, 
        which negatively impacts Tribal economies.

    It is easy to see how involving two competing bureaucracies with no 
authority over each other and little coordination leads to delays in 
effectuating routine transactions like appraisals. As this Committee 
knows from its focus on tribal energy development, delays in securing 
federal approvals and permits and--in this case--appraisals, often 
result in lost economic opportunities for Indian tribes and their 
members.
    Title III of S. 165 would provide for the transition of OST 
functions to a new Under Secretary for Indian Affairs. Section 303 
would establish the position of Under Secretary for Indian Affairs 
(``Under Secretary''), which will report directly to the Secretary. The 
Under Secretary would oversee the administrative transition of 
necessary OST functions and activities, while eliminating those that 
are duplicative of existing BIA and DOI programs. Section 305 provides 
an effective date for the termination of OST and authorizes the Under 
Secretary to administratively reorganize, discontinue, and appoint 
officers and employees to carry out transferred OST functions.
    Indian country has long complained that the monolithic growth of 
OST's footprint and budget has siphoned funding from other BIA 
programs. In FY 2006, OST's budget was $222.7 million--more than double 
what it had been four years earlier. While OST's budget has decreased 
in recent years following the Cobell settlement, no other BIA program 
saw this type of funding increase.
    In fact, during those years funding for most BIA activities was 
either flat or saw reductions. The BIA continues to be woefully 
underfunded and understaffed. Law enforcement is a good example. On 
many reservations, one or two officers are responsible for policing 
large geographic areas because funding has not been available to fill 
vacant officer positions. Even the infusion of two or three additional 
officers on these reservations would make a huge impact to public 
safety. Conversely, OST now has 638 full time equivalent employees 
according to its FY 2015 budget justifications.
    To address this inequity, Section 306 directs the Under Secretary 
to initiate procedures to identify resulting cost savings from those 
OST programs and activities that are duplicative or no longer needed as 
a result of the transfer. This cost savings information would be 
provided to the Secretary and to joint Tribal/Interior Budget Council 
(TIBC). The TIBC is the advisory committee comprised of tribal 
representatives from across Indian country and federal officials that 
collaborates on DOI budget issues. The tribal TIBC representatives 
would then provide their own recommendations on how any cost savings 
should be reallocated.
    OST performs certain functions related to its original mission that 
benefit Indian country. These include its toll-free call center, which 
allows Indian beneficiaries to receive information about their trust 
funds. These also include the reforms and accounting systems that OST 
instituted as result of the Cobell litigation to reconcile, track and 
invest Indian trust funds. S. 165 contemplates that these and other 
necessary functions would continue undisturbed. They would simply be 
administratively transferred and report to the Under Secretary.
    In addition to transitioning OST functions, the Under Secretary 
would also assist in coordinating BIA policies with the policies of 
other bureaus and offices within DOI. For decades, this lack of 
coordination has negatively impacted Indian country as other entities 
within DOI have made decisions or undertaken initiatives without 
considering the impacts on Indians and tribes.
    Because the Under Secretary would be charged with improving 
efficiency and coordinating with the Assistant Secretary-Indian Affairs 
and other DOI agencies, there would no longer be institutional 
competition between OST and BIA after the OST functions transfer. All 
of this would provide an immediate, practical benefit to Indian 
country.
    ATNI and the Coeur d'Alene Tribe are grateful for the Committee 
holding today's hearing. With the legislative calendar quickly slipping 
away, we look forward to working with the Committee to advance S. 165 
as quickly as possible.

    The Chairman. Thank you for your testimony. I appreciate 
it. There will be questions.
    Next we have Jennifer Keough, from the Garden City Group, 
who is responsible for getting the checks out at the 
appropriate time. So you are on, the floor is yours, Jennifer.

STATEMENT OF JENNIFER KEOUGH, EXECUTIVE VICE PRESIDENT/CEO, THE 
                    GARDEN CITY GROUP, INC.

    Ms. Keough. Chairman Tester, Vice Chairman Barrasso, and 
distinguished members of the Committee, my name is Jennifer 
Keough. I am the Chief Operating Officer of the Garden City 
Group, and I am pleased to be here today.
    Garden City is honored to serve as the court-appointed 
claims administrator in this important Cobell settlement. We 
fully understand what is at stake in this important case for 
the hundreds of thousands of class members who have waited 
decades to resolve claims over Indian trust accounts, even 
before the settlement was approved by Congress.
    Garden City has devoted more than 730,000 hours to 
fulfilling our assigned duties under the settlement. At every 
step, we have dedicated the resources to complete our tasks 
within our authority as quickly and efficiently as possible. We 
have met every deadline set by the court.
    We stand ready to issue all remaining payments owed to 
class members as soon as the payment amounts are resolved and 
the parties approved and the court approves the final payments.
    In performing the functions as the claims administrator, 
Garden City operates at the direction of the parties and 
subject to the approval of the court. Garden City is authorized 
to act only and when specified in the settlement agreement. We 
are not allowed to make any payment to class members until the 
amount of the final payment is authorized and approved by the 
court.
    The Cobell litigation involves many trust account records 
that were missing, incomplete or simply inaccurate. A big part 
of Garden City's role has been to assist the parties in 
identifying and locating potential class members, including 
through an ambitious program of outreach to Indian communities 
across the Country. We have met with thousands of Indian 
beneficiaries to help reconstruct individual records and have 
conducted a massive notification drive.
    We also operate a website and a call center. Our call 
center has received over 2.8 million calls, over 15,000 per 
week. Our website receives over 4,000 visits per week. As a 
result, we have been able to locate over 178,000 class members 
for whom there was insufficient contact information in the 
original data provided to GCG.
    Of the nearly 67,000 people officially identified by the 
government as whereabouts unknown, we have located 80 percent. 
Thousands and thousands of additional individuals will receive 
payments because of these efforts.
    As the Committee knows, there are two distinct settlement 
classes here. There is the trust administration class and the 
historical accounting class. Shortly after the settlement was 
approved in December 2012, the court authorized the 
commencement of payments to the historical accounting class. 
Garden City began mailing those payments within three days of 
receipt of the court order. And we completed that process well 
within the deadline set by the court.
    Since that time, we have continued to distribute these 
payments as we have located correct contact information, 
resolved liens, and identified proper beneficiaries for the 
deceased class members. I am pleased to report that more than 
90 percent of the over 340,000 members of the historical 
accounting class have received their payments.
    The payments to the trust administration class are in a 
different and more complex lot. The amounts to be paid have not 
yet been finally calculated as required by the settlement 
agreement and authorized by the court. Garden City therefore 
has no current ability to distribute any payments to the trust 
administration class.
    Garden City was tasked with making the initial 
determinations for the class, and we put in enormous efforts to 
complete that work within the time frame set by the court. We 
reviewed more than 480,000 claim forms. We conducted over 
86,000 reconsideration reviews and we identified over 240,000 
eligible class members. Fewer than 2,500 of our claim 
determinations, or less than one half of 1 percent, were 
appealed to the special master.
    We know the Committee has questions about the timing of 
payments to the trust administration class. There are two 
primary reasons why these payments have not yet been issued. 
The first is that the original settlement agreement 
contemplated that payments to the trust administration class 
would only occur when all appeals of eligibility were resolved. 
That issue is now addressed by a recent court order permitting 
a phase distribution during the pendency of the appeals.
    The second reason is that under the settlement, no payments 
may be authorized for any eligible trust administration class 
member until the Department of Interior has calculated the 
amount owed under a specified formula. Based on a status report 
filed with the court two days ago, and the testimony that we 
heard here today, our understanding is that DOI is working on 
those calculations and currently expects to complete this work 
in early fall.
    DOI's calculations depend on information only available to 
DOI, and Garden City is not involved in performing those 
calculations. Once those final numbers are provided to us and 
approved by the court, Garden City stands ready to begin the 
process of issuing payments to the trust administration class.
    Thank you, Mr. Chairman.
    [The prepared statement of Ms. Keough follows:]

 Prepared Statement of Jennifer Keough, Executive Vice President/CEO, 
                      The Garden City Group, Inc.
    Chairman Tester, Vice Chairman Barrasso, and distinguished Members 
of the Committee, my name is Jennifer Keough and I am pleased to appear 
today representing The Garden City Group, Inc. (``Garden City''), the 
Court-approved Claims Administrator for the historic settlement 
authorized by Congress in Elouise Pepion Cobell, et al. v. Jewell (the 
Cobell Settlement). Garden City welcomes the opportunity to assist this 
Committee in its oversight of the implementation of the Cobell 
Settlement.
    Garden City is one of the nation's leading class action settlement 
administration firms. We employ more than 1,000 people in ten offices 
throughout the United States, including our Corporate Headquarters in 
Lake Success, New York, and our 50,000- square-foot West Coast 
Headquarters in Seattle, Washington, where much of our work on the 
Cobell Settlement is performed. Over the past three decades, Garden 
City has repeatedly served as court-approved administrator in class 
actions throughout the country. In more than 2,500 matters, we have 
distributed more than $30 billion in settlement funds. We are regularly 
retained by defense counsel as well as plaintiffs' counsel and have 
managed more billion-dollar-plus settlements than any other firm in our 
industry. Garden City has been ranked the number one or number two 
claims administrator by The New York Law Journal four years in a row.
    I am Executive Vice President and Chief Operating Officer of Garden 
City and am proud to manage our important work on the Cobell 
Settlement. While we bring the same commitment and diligence to all of 
our jobs, Garden City is particularly honored to have been selected to 
serve as Claims Administrator for this enormously consequential 
project.
    We understand and appreciate what is at stake in this case for the 
hundreds of thousands of Class Members who have waited decades for the 
resolution of claims concerning Individual Indian Money (IIM) trust 
accounts and other trust assets. To assist in the implementation of the 
Cobell Settlement, Garden City has devoted more than 730,000 hours thus 
far to fulfilling our assigned duties under the Settlement. At every 
step along the way, we have dedicated the attention and resources 
needed to complete all the tasks within our authority as quickly and 
efficiently as possible, and we expect to be ready to issue all 
remaining payments owed to the Class Members expeditiously once the 
payment amounts are finally resolved by the Parties and approved by 
Judge Hogan, as required by the terms of the Settlement.
The Cobell Settlement and Garden City's Role as Claims Administrator
    Thirteen years after Elouise Cobell and her fellow plaintiffs 
brought suit against officials of the Department of the Interior (DOI) 
and the Secretary of the Treasury seeking to correct deficiencies in 
the management of IIM trust accounts and related assets, the Parties 
finalized their landmark Settlement Agreement on December 7, 2009.
    The Settlement Agreement was contingent on final court approval 
following the resolution of any appeals and on the enactment of 
legislation by Congress ratifying the Settlement and authorizing the 
necessary funding. Congress authorized the Settlement with the passage 
of the Claims Resolution Act on December 8, 2010. Thereafter, the 
District Court gave preliminary approval to the Settlement on December 
21, 2010, and issued its final Order of approval on July 27, 2011. Four 
Class Members appealed the final judgment approving the Settlement, and 
those appeals were not resolved until November 24, 2012. Accordingly, 
the Cobell Settlement did not receive final approval until that date.
    The Settlement Agreement established two distinct and partially 
overlapping settlement classes, the Historical Accounting Class and the 
Trust Administration Class, whose members were to receive payouts under 
the Settlement in two stages. At Stage 1, each identified member of the 
Historical Accounting Class was to receive a per capita payment of 
$1,000. At Stage 2, each identified and eligible member of the Trust 
Administration Class was to be paid a baseline payment of $500 plus a 
pro-rata amount based on an ``Assigned Value'' calculated in accordance 
with a formula set out in the Settlement Agreement. The Settlement 
Agreement states that ``No Stage 2 payments shall be made until all 
Stage 2 Class Members have been identified in accordance with this 
Agreement and their respective pro rata interests have been 
calculated.''
    As Claims Administrator for the Cobell Settlement, Garden City's 
role is to provide administrative services to the Parties to facilitate 
the distribution of settlement funds to the Class Members in accordance 
with the requirements and conditions of the Settlement. These services 
include assisting Class Counsel in administering and distributing the 
settlement funds with the approval of the Court and in reliance on 
information provided by DOI. They also include locating members of the 
Historical Accounting Class, starting from contact information provided 
by DOI. With respect to the Stage 2 payments to the Trust 
Administration Class, Garden City was tasked, subject to approval of 
the Court, with establishing standards and procedures to permit 
potential members of the Class to submit documentation supporting their 
claim of eligibility to receive a Stage 2 payment, and Garden City was 
given the job of making the initial determinations of eligibility, 
subject to a right of appeal to the Special Master and final resolution 
by the Court. Garden City has no role in administering the Land Buy-
Back Program or the Trust Land Consolidation Fund established by 
Congress.
    In performing all of its functions, Garden City operates at the 
direction of the Parties and subject to the supervision of the Court. 
Garden City is authorized to act only when and as specified under the 
terms of the Settlement. In particular, Garden City is prohibited from 
making any payment under the Settlement unless and until the amount of 
the payment is finally resolved pursuant to the requirements of the 
Settlement and is specifically approved by the Court.
Garden City's Work Identifying and Locating Class Members
    Because many of DOI's records relating to IIM trust accounts and 
individual Indian beneficiaries were missing, incomplete, or 
inaccurate, Garden City was required to undertake very extensive 
efforts to assist the Parties in identifying and locating potential 
Class Members. Some of the issues we faced when we first received data 
from DOI in 2010 included the following:

   There was insufficient contact information for 315,349 Class 
        Members and no address at all for 174,909 names in this 
        population.

   We received incorrect address information for 73,594 Class 
        Members.

   66,846 Class Members were officially classified as 
        ``Whereabouts Unknown'' by DOI.

   21,974 individuals listed as alive were actually deceased, 
        and 1,313 individuals listed as deceased were actually alive.

   In 14,649 cases, there were multiple different records for 
        the same individual.

   Some individual Indians were incorrectly identified as non-
        Indian.

   Records were missing for thousands of Class Members in 
        Oklahoma and Alaska.

    To address these data issues and assist Class Counsel in 
facilitating distribution of payments in accordance with the 
Settlement, Garden City has participated in an ambitious program of 
outreach to Indian communities. These outreach efforts have included:

   Sending out more than 375,000 notices and claim forms and 
        more than 245,000 additional outreach mailings;

   Maintaining a call center that receives an average of 15,000 
        calls per week and has handled over 2,800,000 total calls;

   Scanning and reviewing 3,219,477 pages of documentation 
        relating to potential Class Members;

   Holding dozens of meetings in Indian communities to identify 
        potential Class Members;

   Working with various Indian Tribes, Alaska Native 
        Corporations, and other Native American community organizations 
        to identify potential Class Members;

   Publishing announcements in dozens of newspapers and tribal 
        publications listing Class Members for whom we have 
        insufficient or incorrect information; and

   Maintaining and updating the Cobell Settlement website, 
        www.indiantrust.com, which receives an average of 5,000 visits 
        per day.

    Specifically, over the last year, Garden City and Class Counsel 
have conducted town hall meetings in 14 different cities, and Garden 
City met individually with thousands of Indian beneficiaries at these 
meetings to go over their record information. Below is a list of cities 
where the meetings have been held over the last twelve months or are 
scheduled to occur in the immediate future.
Summer and Fall 2013
   Farmington, NM
   Gallup, NM
   Crown Point, NM
   Houck, AZ
   Oklahoma City, OK
Spring and Summer 2014
   Anadarko, OK
   Durant, OK
   Red Rock, OK
   Anchorage, AK
   Belcourt, ND
   New Town, ND
   Eagle Butte, SD
   Pine Ridge, SD
   Red Rock, OK
   Kamilche, WA

    These locations were chosen because they are in areas of the 
country with higher numbers of ``Whereabouts Unknown'' Class Members, 
Class Members or beneficiaries lacking sufficient deliverable mailing 
address information, and estates of deceased Class Members lacking 
probate or other distribution documentation. The town hall meetings 
were set up to discuss the process and timeline for the Trust 
Administration Class distribution, assist Class Members with 
documentation, and reach out to Class Members needing updated contact 
information. To that end, Garden City has brought the contact data 
provided by DOI to each meeting on a secure database system created for 
the Settlement so that Class Members can validate and update their 
records onsite and provide documentation directly to Garden City to 
facilitate payment distribution. Typically, we have arranged to have a 
team of 5 to 10 people with computer terminals at each meeting to 
assist individuals with inputting and correcting data.
    I have personally attended many of these meetings and will be at a 
meeting in Washington State this coming weekend. We are currently 
working with Class Counsel to schedule additional town hall meetings in 
Idaho, Montana, Washington, Wyoming, and potentially other States.
    In addition, Garden City has contacted more than 300 Tribes and is 
working with approximately 200 tribal organizations to obtain current 
addresses and updated contact information so that awards can be 
distributed without delay once approved by the Court.
    As a result of these efforts to date, we have thus far been able to 
locate approximately 178,000 Class Members for whom there was 
insufficient contact information, or 56 percent of the affected 
individuals. In addition, of the 66,846 individuals officially 
identified as Whereabouts Unknown, we have located approximately 80 
percent, or all but 13,890. We were also able to assist DOI in 
identifying an additional 12,306 individuals who should have been 
accounted for as members of the Historical Accounting Class but were 
not identified in the records provided to us, and our identification of 
these 12,000-plus individuals allowed them to receive payment under the 
Settlement.
    Furthermore, Garden City has undertaken efforts to identify the 
heirs of the 61,588 Class Members we determined were deceased. We 
assisted with 620,000 mailings and dozens of meetings and publications 
designed to find the heirs of these Class Members so that we can 
distribute payments to their estates. In fact, it was Garden City's 
review of claimant documentation plus our outreach to Class Members 
that enabled us to identify categories of documents that claimants 
could rely on to resolve estate issues more easily than had been the 
case early in the Settlement administration. Class Counsel petitioned 
the Court to allow the use of this additional documentation, to the 
benefit of a great many Class Members.
Garden City's Distribution of Historical Accounting Class Payments
    Shortly after final approval of the Cobell Settlement, on December 
11, 2012, the District Court issued an Order directing ``commencement 
of payment [for the Historical Accounting Class] no later than December 
24, 2012.'' Three days after the Court's Order, on December 14, 2012, 
Garden City commenced the mailing of Stage 1 payment checks to the 
Historical Accounting Class. We completed these Stage 1 mailings well 
within the deadline set by the Court.
    DOI subsequently identified more than 12,000 additional members of 
the Historical Accounting Class who were not encompassed in the Court's 
December 11, 2012 Order. On January 23, 2014, the Court authorized the 
distribution of Stage 1 payments to these additional Class Members, 
and, once again, Garden City promptly completed this subsequent 
distribution.
    I am pleased to report that to date, more than 90 percent of the 
339,206 individuals identified as members of the Historical Accounting 
Class have received the Stage 1 payments to which they are entitled. 
The remaining identified Class Members include estates pending in 
probate, Class Members whose checks were mailed but returned as 
undeliverable, Class Members with missing addresses, and Class Members 
whose checks had to be withheld due to liens. We will continue to 
process as quickly as possible all remaining Stage 1 payments, when and 
as additional required information is identified and the payments are 
permitted by law and approved by the Court.
The Processing and Status of Trust Administration Class Claims
    Unlike the payments to the Historical Accounting Class, the Stage 2 
payments to the Trust Administration Class have not yet been calculated 
by DOI as required by the Settlement, nor have they been authorized by 
the Court. Therefore, Garden City has no current authority to 
distribute any payments to the Trust Administration Class.
    In its December 11, 2012 Order, the Court directed that notice be 
provided to potential members of the Trust Administration Class, and 
the Court initially set a deadline of March 1, 2013 for claimants to 
mail their claim forms to Garden City. The Order also set a schedule 
for Garden City's initial determinations of class eligibility, for the 
submission of additional information by claimants initially determined 
by Garden City to be ineligible, and for the appeal of eligibility 
determinations to the Special Master. On April 10, 2013, the Court 
modified the schedule to give claimants additional time to obtain 
documentation to support their claims, and under the modified schedule, 
the deadline for appeals of Garden City's eligibility determinations to 
the Special Master was extended to September 4, 2013.
    Garden City completed all of the required eligibility 
determinations for the Trust Administration Class within the deadlines 
set by the Court. Meeting these deadlines required enormous 
administrative efforts. We received more than 480,000 claim forms in 
this process and reviewed every submission to determine eligibility. As 
a result of this process, we initially determined that 186,679 
claimants were eligible to receive Stage 2 distributions. Of those 
initially determined to be ineligible, 85,979 requested 
reconsideration, and with the additional information submitted by these 
claimants, Garden City was able to determine that 53,169 of those 
requesting reconsideration were eligible Class Members. I am pleased to 
report that only 2,451--or less than one half of one percent--of our 
claim determinations were appealed to the Special Master.
    I know this Committee has questions about the timing of payments to 
the Trust Administration Class and is keenly interested in the reasons 
why these payments have not been authorized by the Court and 
distributed. There are two primary reasons why these payments have not 
yet been authorized.
    First, the original terms of the Settlement contemplated that the 
distribution of any payments to the Trust Administration Class would 
occur after all appeals of eligibility determinations had been finally 
resolved by the Special Master and the Court. The reason was that the 
pro-rata amount owed to any one member of the Class depends upon the 
total number of eligible Class Members and the calculation of the final 
payment amount determined to be owed to each individual claimant. 
Because more than 2,000 eligibility determinations were appealed to the 
Special Master and because there is no deadline for the final 
resolution of eligibility appeals, Stage 2 payments were not authorized 
while appeals remained pending. Therefore, Garden City had (and still 
has) no authority to mail any checks to the eligible members of the 
Trust Administration Class.
    Fortunately, the issue created by the appeal process has now been 
addressed by the Parties and the Court. Class Counsel recently moved 
the Court for an order permitting the phased distribution of Trust 
Administration Class payments prior to the final expiration of all the 
appeals, and on May 28, 2014, the Court approved this request.
    The Court's May 28 Order, however, does not address the second 
issue that currently prevents Garden City from sending out any Stage 2 
payment checks. Under the Settlement, Garden City may not make any 
payment to an eligible member of the Trust Administration Class until 
DOI has first calculated the amount owed, as provided for in the 
Settlement, and the Court has specifically approved the payment amount. 
Garden City has no access to the information necessary to make these 
calculations and is not involved in making the calculations required by 
the Settlement.
    We have not yet received final award calculations from DOI, 
although we understand that DOI is continuing to work on finalizing 
those numbers. Once these amounts are determined, the payments must 
then be finally approved by the Court before Garden City is authorized 
to issue the payment checks.
    Once the final numbers are provided to Garden City and approved by 
the Court, we stand ready to process and distribute payments to the 
Trust Administration Class as efficiently and quickly as possible. We 
are eager to complete the process.
    Thank you, Mr. Chairman. That completes my testimony, and I would 
be happy to answer questions from the Committee.

    The Chairman. Thank you for your testimony, Jennifer.
    We will go to questions now. I am going to start with you, 
Carol. What concerns have you heard from your tribal members 
about the Land Buy-Back program?
    Ms. Lankford. Just that they want this process expedited, 
that we have not made any purchases yet. They just want to see 
it start, the process start.
    The Chairman. How about outreach from the Department of 
Interior regarding the Land Buy-Back program? Has there been 
adequate outreach for them?
    Ms. Lankford. We have had a lot of conversations with them, 
but I don't know if we have had any progress with the 
conversation.
    The Chairman. Has CSKT done anything as far as outreach 
goes?
    Ms. Lankford. Can you repeat that question, please?
    The Chairman. I was wondering if the tribe had done 
anything as far as outreach goes, to the members.
    Ms. Lankford. Oh, yes, absolutely. We have already done the 
notification to the membership about the program. I think that 
is part of the problem, we have the information out there, but 
we haven' got started. So people keep asking, the membership 
keeps asking us, when are you going to start doing it, you have 
the information out there, you told us that we can sell our 
fractionated interest, but then nothing happens.
    The Chairman. Susan Waukon, you stated in your written 
testimony that you are worried about the current acceptance 
rate of the buy-back offers, too low to ensure that all the 
money appropriated will be used. In fact, you said it in your 
verbal testimony, too, that all the money will be used 
consolidating the fractionated interests before the 10-year 
deadline is up. Has the Ho-Chunk legislature and tribal leaders 
been working with the owners of fractionated interests in order 
for the tribe to make sure that Ho-Chunk is above that 35 
percent national average?
    Ms. Waukon. As being number 65 out of the 150 tribes on the 
Buy-Back program, we just recently started. We attended some of 
the prior discussions, the outreaches. We started working on 
cooperative agreements. That is what we are trying to do, is 
the outreach right now. We know there is a lot of interest in 
that consolidation. So yes.
    The Chairman. Yes. The Department of Interior has been 
focused on the piecemeal execution of the Buy-Back program for 
good reason, working with a few tribes at a time. Your 
testimony indicates it is not even clear that the Ho-Chunk and 
perhaps other non-top 40 tribes, what the DOI plan is for you 
when the time comes. What sort of consulting or information 
sharing would be useful? What is being done at this point in 
time, if any? And what would be useful when it does happen?
    Ms. Waukon. Consulting with the BIA or just consulting----
    The Chairman. Consulting with the Department or BIA.
    Ms. Waukon. I think the number one thing we have been 
running into is just, even though there is a template 
agreement, it is going to differ from tribe to tribe. So it 
would be nice to have more tribal to tribal templates to make 
them available. Some of the tribes that we have talked to that 
have some of the cooperative agreements, they kind of tell us 
of their horror stories, of the negotiation process and so 
forth. So to me it would be more of the tribal outreach, 
working tribal nation to nation, as we put it.
    The Chairman. All right. Helo, your tribe recently entered 
into a cooperative agreement with the Department. Can you tell 
us how that agreement was negotiated?
    Mr. Hancock. Yes. We met a few times with Mr. McClanahan 
and the folks from the Buy-Back program out in our neck of the 
woods. I think we met at a couple other locations. But all in 
all, it was a fairly involved process. The tribe worked pretty 
closely with them to get that negotiated. But we took on the 
outreach efforts, and as I mentioned earlier, we have a pretty 
substantial data base for existing landowners. So it was kind 
of a natural fit for us.
    The Chairman. How long did it take to negotiate the 
agreement?
    Mr. Hancock. I could be wrong here, but I think about six 
months.
    The Chairman. Did it resolve all the outstanding issues? In 
other words, are there some unresolved issues?
    Mr. Hancock. I don't know the answer to that off the top of 
my head, but I could definitely find out for you.
    The Chairman. Then six months, were the things in the 
process you thought could be improved?
    Mr. Hancock. I think so. I think tribes are fully 
accustomed to a pretty delayed response time on getting back on 
negotiating agreements with BIA and Interior. But in this case 
I think we had a fairly positive experience with the Buy-Back 
program.
    The Chairman. Thank you. Vice Chairman Barrasso?
    Senator Barrasso. Thank you, Mr. Chair.
    Just to follow up on one of the questions you had to Ms. 
Waukon, Secretary Connor, who was here earlier from the 
Department of Interior, in his written testimony he said they 
were pursuing some opportunities to include some of these less 
fractionated areas, such as your reservation and the Buy-Back 
program. In your written testimony it says that your tribe has 
already done a lot of these things, like you have existing land 
title records program, which conducts functions very similar to 
those that are needed by the Buy-Back program. So it seems you 
are ready to go in terms of that aspect of it.
    I am just curious how existing tribal systems, like what 
you have, how that could be incorporated better into the Buy-
Back program to make it work better.
    Ms. Waukon. Well, that is kind of a lengthy response, but 
the short answer is that for us that have the experience, and 
we have been working steadily and doing more of the contracting 
ourselves and working with the Buy-Back program, I honestly 
think, just give us the money, let us do it.
    Senator Barrasso. Ms. Lankford, I see you shaking your head 
up and down, yes. Do you have anything you would like to add?
    Ms. Lankford. Yes. In 1994, we got our title plat, and I 
tell you, we have been able to do a lot of things. The Bureau 
doesn't seem to be an obstacle to us, because we are able to do 
it all ourselves. There is an approval process, of course, but 
we are able to do it. So I think any tribe that has that kind 
of infrastructure will be able to get the Land Buy-Back program 
up and going and work through it.
    Can I add one thing? The only obstacle I see in our process 
is the appraisal process. We have 13 appraisals done, well, we 
have a lot more than that out there, but that is done. But the 
Bureau requires approval on those appraisals, and we are the 
only ones that have this in our agreement. So it has put a 
roadblock in our way. Then they can't get to the appraisals to 
review them within five days. So then we have to start all 
over. It is just totally ridiculous to me that they would put 
that in our agreement and not put it in others. Why are we 
different?
    Senator Barrasso. Thank you very much. Thank you, Mr. 
Chairman.
    The Chairman. Thank you. Senator Heitkamp?
    Senator Heitkamp. I want to follow up a little bit on the 
appraisal issue, because I think from what the Deputy Secretary 
said, it is appraisals that have been a challenge. We all know 
that it is difficult to do appraisals in rural communities, 
much less appraisals in your community. I want to just ask, Mr. 
Hancock, if you were going to improve the appraisal process 
today, what would you change in what the Department is doing?
    Mr. Hancock. Thank you. I think the first thing would be to 
bring the appraisal process under one line of authority. Right 
now that is bifurcated.
    Senator Heitkamp. You mentioned that.
    Mr. Hancock. That adds for administrative delays and red 
tape that we have been bogged down with. That is the first 
thing I would do is bring it under one line of authority.
    Secondly, I think there are tribes that are capable of 
contracting for those services and doing the mass appraisals 
maybe much more efficiently than the Department could. Every 
tribe is different, there isn't a cookie cutter fit to it. So I 
think allowing that flexibility for each tribe to craft that 
appraisal scheme how they deem best would probably be the best 
approach.
    Senator Heitkamp. Did you consider that in negotiating your 
agreement?
    Mr. Hancock. I know appraisals were a part of it, and I 
believe Interior, I think they are doing the appraisals.
    Senator Heitkamp. We hear testimony earlier from the Deputy 
Secretary that they are flexible on these agreements. If there 
were a structure that your tribe would be willing to kind of 
accommodate their concerns about appraisals but expedite this 
process, is that something you guys have talked about?
    Mr. Hancock. I think we did discuss that process with them. 
I am not exactly sure how it was resolved or agreed upon.
    Senator Heitkamp. Carol, you expressed some frustration 
with the current agreement, the way it is written. Have you 
guys talked at all about an amended agreement, taking a look at 
other experiences, saying, I wish we had done it that way? And 
if you have, how has that request for modification been met?
    Ms. Lankford. In my testimony, I said that we have 
contacted them and they don't respond back to us, even though 
it is a requirement that they get back to us. I believe that is 
where that is, is that they just don't get back to you. So then 
we have to continue to make the request.
    Senator Heitkamp. So you have requested modification, but 
there has been no response back.
    Ms. Lankford. I can't say that in every instance, but I 
know it has happened numerous times.
    Senator Heitkamp. One last question about appraisals at 
Flathead. What do you see in terms of actual appraisal 
impediments to the Buy-Back program?
    Ms. Lankford. I know we have every appraiser on the 
reservation working. I think there are four or five of them. We 
can get the appraisals done. What I did is used a wrong figure. 
We have 60 appraisals done and only 16 have been reviewed. So 
that makes us go back and start the process over. I don't think 
the problem is with the appraisals, actually getting the 
appraisals done.
    Senator Heitkamp. I am trying to understand why you only 
have five days and then you have to start the process back over 
again.
    Mr. Waters. I am George Waters. The tribe asked for a five-
day turnaround period. It wasn't something that the BIA foisted 
on them. They wanted to try and come up with a system where the 
BIA would respond quickly. And the 60 instances in which they 
submitted appraisals where there was a required five-day 
turnaround, none of those time lines were met. They have to 
start over again.
    Senator Heitkamp. What do you mean by start over? You don't 
have to start the appraisal over again?
    Mr. Waters. The appraisal, that part of the appraisal 
system just wasn't accepted. So they do begin the process 
again, as I understand it. And another big problem is BLM 
mapping. BLM is not going to come onto a reservation and do 
this. If BLM's data is contrary to the TAAMS data, then BLM 
won't necessarily approve it. There is not enough flexibility, 
as I understand it from talking with the people running the 
program on the reservation in both the mapping and the 
appraisal process to sort of be realistic on day to day 
actions. Those are both big delays.
    Senator Heitkamp. So in light of those concerns, do you 
have concerns that you will basically see this program 
expedited and implemented within the 10-year period?
    Mr. Waters. Right now, they are a month into it and they 
haven't done a single one yet. And they have 11 months left.
    Senator Heitkamp. And you are just one reservation.
    Mr. Waters. The 12-month time frame is way too shot. 
Arguably the 10-year time frame is too short. Both bills in the 
House and Senate now would extend that, which I think would be 
a positive provision.
    Senator Heitkamp. Thank you, Mr. Chairman.
    The Chairman. You can keep going if you like. You seem to 
be on a roll.
    Senator Heitkamp. No, it is always so frustrating to me, 
honestly, when you hear one side of the story, it is going 
well, we think we are on task, and then you all who have 
experience with this come to us and say, not really, we have 
concerns, we would like some modifications. I asked if there 
was flexibility or whether these templates were set in stone, 
because I know how that goes. Some lawyer in the government 
says, here is the absolute provisions and it is like it takes 
an act of God, never mind an act of Congress, to actually 
change that provision. Even though they say they are flexible, 
it just takes so long.
    So what I am hoping that we are going to try and do is take 
a look at those shortcomings from the experience that you have 
had and begin to expedite this process in a way that 
appreciates the government to government relationships and 
nation to nation relationships that there ought to be. We have 
set a policy in this body and going forward of tribal self-
determination. But every time we turn around and do a major 
program like this, it doesn't seem like we have a lot of tribal 
self-determination. Even though there are so many tribes that 
are ready to manage this and do this.
    So I think given how difficult it is right now to get 
something changed in statute, we need to continue to push for 
accommodation in the implementation process that we have. Your 
testimony has been very valuable. I like this idea of 
consolidated appraisals maybe getting to some kind of structure 
or certification of an appraiser so that that process can work 
better. I like the idea of dealing and prioritizing tribal 
governments that have already done a great deal of title work 
where those issues are ready to go and the allocation can be 
expended without a whole lot of risk that you are providing a 
buy-back to someone or a payment to someone who doesn't 
technically own the land.
    I know how passionately, from our tribal governments and 
obviously, I think every one of the tribes in North Dakota is 
in the top 40. Standing Rock is number 2. So they are 
passionate about getting this done. And that is the dream of 
this settlement. We need to make sure that this dream gets 
implemented. I share when, is the next opportunity to do this, 
it is going to be far away.
    So I would ask, Mr. Chairman, that we continue to work with 
the Committee. Obviously we want to do the legislation but w 
want to continue to hear a unified story in terms of 
implementation and not, this is we think is happening and then 
have a group of people who have been working so closely with 
this system come to us and say, well, not really. That has been 
problematic for us.
    So this is a big part of what we hope to accomplish as a 
part of this settlement.
    The Chairman. I think the key with all this is 
communication, and good communication up and down the line, and 
hopefully there will be conversations started simply from your 
line of questioning.
    Senator Heitkamp. Mr. Chairman, I also think it is not just 
communication, because these guys talk this issue to death, 
right? You have heard them say, we don't get any response, 
right? It is about listening. And actually, understanding that 
we are moving toward a tribal self-determination policy, and 
everything that is contrary to that ought to be examined in 
fine-toothed detail about why aren't we giving the tribes more 
self-determination, recognizing that the statute didn't do 
that. And I recognize that. But there are ways to accomplish 
self-determination beyond just a piece of legislation.
    So I think it is critically important that we continue to 
put the pressure on DOI.
    The Chairman. I agree.
    Jennifer Keough, I have a few questions for you. Your 
testimony stated that the Garden City Group will be ready to 
distribute the final Cobell payments once those amounts are 
determined by the Department of Interior and those amounts are 
approved by the court. Once those amounts are approved by the 
court, how long will it take for the Garden City Group to send 
out those payments?
    Ms. Keough. Chairman Tester, as soon as we have court 
approval, we will be able to issue those payments within two to 
three weeks.
    The Chairman. Oh, wow. Okay. And the Garden City Group has 
done a good job, as your testimony has indicated, 80 percent of 
the whereabouts of the unknown class members. You state that 
Garden City's review of claimant documentation and outreach 
efforts contributed to the increased resolution of estate 
matters of affected Indians. Could you go into a little bit 
more detail on this, like exactly what did you do and what more 
can be realistically done to find the rest of the whereabouts 
of the unknown individuals?
    Ms. Keough. Right now, Mr. Chairman, in the original data 
provided to us by the Department of Interior, there were 67,000 
whereabouts unknown individuals. What we did in our work with 
class counsel and the Department of Interior, in addition to 
our call center, where we received lots of calls from people 
who self-identify and tell us, hey, we are not whereabouts 
unknown, this is where I am, this is where I am located, I am a 
trust administration class member, please issue my payment to 
me. We also have a website where we publish information that is 
approved by class counsel that helps people self-identify.
    In addition, we have gone out to Indian communities, I 
myself this weekend are going to Washington State. We have been 
to Alaska, we have been to over 13 different Indian communities 
and we have done radio shows, I have done a radio show for 
Oklahoma. These are just some of the things that we are doing 
in order to encourage the whereabouts unknown individuals to 
self-identify.
    Three weeks ago we were in Alaska and last week our call 
center received many, many calls from Alaska, helping us 
identify whereabouts unknown individuals.
    The Chairman. In that vein, I think you said it, 15,000 
calls a week?
    Ms. Keough. Fifteen thousand calls a week, over 2.8 million 
throughout the life of the case.
    The Chairman. Regarding this settlement, the Cobell 
payment. What more can be done to get the information out? Let 
me give you an example. I just had the broadcasters in my 
office today as an association. Is there a potential for PSAs 
and could they be structured in such a way that they actually 
would do some good?
    Ms. Keough. I think so, Chairman. I think what we have done 
so far with going out to the Indian communities and being on 
radio shows and putting publication about the settlement in the 
paper has helped. But we can certainly talk to the parties 
about doing more.
    The Chairman. That would be good.
    In the past, at least to my understanding, Garden City 
Group has given individuals who call an estimate of what they 
might receive. This is based on a formula for the settlement, I 
am sure. We have recently heard concerns from individuals that 
that estimate may have gone down, in some instances, quite a 
bit. Can you describe how you provide estimates and what can be 
done about why a settlement payment would potentially go down?
    Ms. Keough. The original data provided to us from the 
Department of Interior contained an estimate, an estimate. When 
class members call the cost center, we provide them with that 
estimate. Since we receive new estimates from the Department of 
Interior, we provide them with the new estimates.
    The Chairman. And those estimates might be lower?
    Ms. Keough. And those estimates might be lower.
    The Chairman. Okay. I want to thank you, thank you for your 
testimony, thank all of you for your testimony and making the 
trek out here. I want to say that the Committee will continue 
to work with the Department of Interior, the Garden City Group 
and with individual tribes to make sure that settlement 
payments are made as quickly as possible. We will continue to 
monitor the Buy-Back program to ensure it can be successful and 
accomplish the goals at as many reservations as possible, with 
as much land as possible.
    So the hearing record will remain open for another two 
weeks for any stakeholders wishing to make a statement. With 
that, this hearing is adjourned. Thank you all.
    [Whereupon, at 3:50 p.m., the hearing was adjourned.]
                            A P P E N D I X

  Prepared Statement of Hon. Tex Hall, Chairman, Mandan, Hidatsa and 
                             Arikara Nation
    Good Afternoon Members of the Committee:
    My name is Tex Hall and I am the Chairman of the Mandan, Hidatsa 
and Arikara Nation of North Dakota. I am also the Chairman of the Great 
Plains Tribal Chairmen's Association and the Coalition of Large Tribes. 
It is a pleasure to appear before you today.
    As you know, the Land Buyback Program was enacted due to the 
settlement of the Cobell v. Salazar litigation. For many years, Indian 
people have known that the Federal Government was mismanaging our trust 
dollars, real property, and other non-monetary assets. We just did not 
know how to stop it. Finally, in 1996, my good friend, Eloise Cobell, 
and another group of brave Indian individuals had the courage to file 
suit against the United States for an accounting of our individual 
trust accounts. Through that litigation, we were finally given a 
partial opportunity to document the extent of that federal 
mismanagement.
    Among the many examples of federal malfeasance that were presented 
to the Court was the U.S. Government's failure to address the 
inheritance and land ownership problems that it created by the passage 
and implementation of the General Allotment Act in 1887. This, as you 
may recall, was the federal statute which divided thousands of acres of 
Indian lands among various individual tribal members.
    Because the Federal Government failed to arrive at a proper system 
for managing the inheritance of these allotted lands, some 150 tribes, 
my own included, now find themselves dealing with tens of thousands of 
individual trust parcels within the boundaries of our reservations 
which are owned by hundreds and in some cases even thousands of 
different individuals. Think about that for a moment, thousands of 
single parcels, scattered throughout our reservations, all of which 
have multiple owners and many of which are owned by well in excess of 
100 different people. This situation is a nightmare.
    According to DOI's own studies, 90 percent of those fractionated 
parcels are now located on just forty (40) reservations, including my 
MHA Nation. The chart contained in the DOI's Updated Buyback 
Implementation Plan, dated November 8, 2013, documents that roughly 33 
percent of these fractionated interests are now located in the Great 
Plains/Aberdeen Area, and around another 24 percent are located in the 
Billings Region of the BIA. Thus, my friend from Fort Peck and I are 
here representing the Tribes who collectively face well in excess of 50 
percent of these problems on a daily basis. On my reservation alone, we 
have 3,024 fractionated tracts with 91,707 separate fractional 
interests. This is largely because many MHA members now have an 
interest in more than one fractionated track. It is also because, as a 
result of inter-tribal marriages, it is not uncommon for members of a 
given tribe to have a fractionated interest in lands on someone else's 
reservation.
    Last week, I was honored to Chair a historic meeting of the tribal 
leaders of the Great Plains Tribal Chairmen's Association, the Montana-
Wyoming Tribal Leaders Council and the Coalition of Large Tribes. The 
Tribes who are the members of these three organizations collectively 
represent in excess of 75 percent of the Plaintiffs in the Cobell 
litigation, and 25 of the 40 tribes most impacted by fractionation. 
Those 25 tribes have been discussing the Cobell Buyback program with 
DOI and with each other since it was first announced.
    We all agree that the Buyback program is a wonderful and much 
needed initiative which was devised by some very well intended people. 
Unfortunately, virtually none of those people had any experience in 
acquiring or managing fractionated interests. They were Indian 
individuals, and/or lawyers with little experience in representing 
tribal governments, who only understood these problems from an academic 
perspective. So, while the buyback program was strongly supported by 
the 150 tribes most impacted by fractionation, it was also developed 
with virtually no tribal input.
    I had the pleasure of talking with my friend Eloise Cobell prior to 
her death and she related that by the time that the Parties to the 
Cobell litigation were finally reaching an agreement, both sides were 
exhausted from thirteen plus years of aggressive litigation. During the 
settlement talks, their primary focus was directed at the total amount 
of money to be paid to the individual Plaintiffs under the other 
provisions of the Settlement and how those monies were going to be 
divided up. So, it is clear to me that while both sides agreed on the 
benefits of a land buyback program, little attention was paid to how 
that program would have to operate in real life. The Indian Land 
Consolidation Act (ILCA) was already in place and it appears to provide 
for tribal participation, so those involved apparently thought that it 
could provide an effective vehicle for the expenditure of the monies 
that were being placed in the Land Consolidation Fund.
    It is equally clear that when the Cobell Settlement was finally 
presented to the Congress, its advocates were scared of changing one 
word in any of the documents for fear of stalling that settlement. This 
has been verified to me by one of our tribal lawyers who actually 
staffed that bill for Senate Indian Affairs Committee. The one person 
who foresaw many of the problems we are now encountering and tried to 
address them was Senator Barrasso of Wyoming. Senator Barrasso pointed 
out the need to amend the Indian Land Consolidation Act to accommodate 
this new use in many of the same ways now proposed in the Daines and 
DeFazio bills.. Unfortunately, Senator Barrasso's suggestions were 
drowned out by those who were saying ``let's just get it done.'' Thus, 
the Claims Settlement Act of 2010 was passed without a series of much 
needed and strongly advisable amendments to ILCA.
    Luckily, the Court has left us an opening to make these 
corrections. If you examine the Settlement itself, you will see that it 
states that the U.S. shall distribute the Land Consolidation Fund:

         In accordance with the Land Consolidation Program authorized 
        under 25 U.S.C. section 2201 et.seq. [ILCA], any other 
        applicable legislation enacted pursuant to this agreement, and 
        applicable provisions of this Agreement.''

    Because the Settlement itself does not require the use of Section 
2201 as it existed at the time of the settlement, Congress clearly has 
the authority to amend ILCA to address the problems I am about to 
address:
What Needs to be Changed?
    First, Congress needs to make it clear to the Administration that 
this is judgment money that belonging to those tribes who suffered the 
actual damages as a result of fractionation. As such, it should be 
generating interest for its owners. I and the other 25 Tribes at last 
week's meeting were thrilled that this position is advanced in the 
three separate pieces of legislation, H.R. 5020, introduced by 
Congressmen Daines; H.R. 4694, introduced by Congressman DeFazio; and 
S. 2387, introduced by Senator Walsh. Unfortunately, only one of the 
three bills, H.R. 5020, advanced by Congressman Daines, recognizes that 
this money was authorized to address the actual damages that various 
tribal communities have suffered. As a result, 90 percent of that money 
rightfully belongs to the 40 tribes listed on page 13 of DOI's November 
8, 2013 Implementation Plan. And, the remainder belongs to the other 
110 tribes who have suffered actual damages as a result of the General 
Allotment Act.
    This is not general Indian money, it is money authorized to correct 
the problems that have been and still are actually occurring in certain 
tribal communities. We ask the members of this Committee to remember 
this very important distinction.
    Second, Congressman Daines correctly suggests that, for this very 
reason, Interior should be directed to immediately and permanently 
transfer the sums that it itself has recommended to the Tribes on the 
November 8, 2013 list, or to obligate and place the funds belonging to 
those tribes who do not want to manage their own buy back accounts into 
separate trust accounts to be held in the name of their individual 
tribal owner. This solves two problems. First, the interest generated 
on the funds transferred to the tribes will be generated through 
private banks and federally backed investment institutions, so it will 
not be coming from the U.S. Treasury and increasing the federal 
deficit. Second, it eliminates the need to spend those dollars in the 
ten year period provided for in the Settlement, because the funds will 
be considered obligated at the time of those transfers.
    Third, the best way of insuring that these funds are managed 
properly is to eliminate the prohibition against the use of P.L. 93-638 
for buyback implementation. By allowing the tribes to utilize P.L. 93-
638 contracts, as all three bills suggest, and as the Tribes have been 
calling for since day one, we solve a multitude of problems. First, 
P.L. 93-638 allows the tribes to be compensated for the very real costs 
of negotiating their management agreements with the federal government. 
Second, it will allow the tribes to negotiate and manage their own 
purchases and limit Interior's role to just the non-contractible trust 
functions, approving the purchase price and transferring the title. 
This not only improves the effectiveness of the program, it also 
eliminates the need for a lot of the federal staffing. Third, it allows 
the Tribes to design their own programs.
    Thus, if Congress passes properly worded legislation, the Tribes 
who chose to implement their programs using ``638'' will be able to 
design and manage their own buyback efforts, negotiate their own 
overhead costs, utilize the interest generated on their local tribal 
investment accounts to acquire fractionated interests that Interior is 
not allowing them to spend buyback dollars on currently. Tribes are 
being impeded from spending buyback dollars on improvements, rights of 
way, and fee parcels. This undermines the effective use of larger 
blocks of land. Tribes should be allowed to decide what interests they 
want and need to buy. While the Settlement limits administrative cost 
to 15 percent, that is 15 percent of the total in the Land 
Consolidation Fund, not 15 percent of the small amount that DOI is 
currently allowing for tribal advertising and public relations efforts 
while keeping the remainder for its own use.
    On my reservation, we have numerous parcels which contain oil and 
gas. We have asked Interior to allow us to acquire certain surface only 
interests, because we need control of the surface to build roads, 
extend pipelines and take other steps necessary to enhance our tribal 
oil and gas income. Unfortunately, Interior has not yet agreed to allow 
those surface only acquisitions. In fact, Interior has limited tribal 
involvement to many of the tasks necessary to make these acquisitions. 
This is not only wrong, it is highly illogical. Interior, to its 
credit, has openly stated that it cannot complete this buyback effort 
without the tribes, but when we try to get totally involved, they 
assert that current ILCA provisions limit their ability to accept our 
offers. To see an example of how this policy leads to failure, consider 
the Tribe which has suffered the most damage as a result of 
fractionation, Pine Ridge. DOI forced them into an advertising and 
public relations only agreement, it managed the appraisals and it 
decided which parcels were and were not available to acquisition. It 
also limited the tribe to just less than 24 months to implement this 
program. As a result, Pine Ridge was only able to utilize less than 50 
percent of the $125,427,372 that DOI itself said that the tribe was 
entitled to as a result of its damages.
    One of the things that it is very important for the Committee to 
understand is that fractionation creates problems well beyond requiring 
DOI to manage an ever increasing number of trust accounts. It also 
slows and sometimes even curtails our tribal ability to build roads, 
install water lines, develop Internet connections, and utilize large 
sections of our reservations for economic development. It also 
generates a sizable amount of work for BIA representatives when 
developments of this nature have to be done. Thus, I find it hard to 
understand why Interior has, to date, insisted on focusing its 
attention and mandates on total estate acquisitions and on controlling 
so much of the process.
    Finally, something that is not addressed by any of the pending 
bills, but needs to be included in any legislation that is passed, is 
the need to allow the tribes to establish their own fair market value 
for these acquisitions. At the present time, Interior's only focus is 
on the use of appraisals to determine how much can be spent for a 
particular acquisition. Those appraisals do not take adequate account 
of the improvements which exist on many of the fractionated parcels, 
and they completely fail to take into consideration the benefits that 
an entire tribal community will obtain from acquiring certain parcels. 
The current Settlement states that Fair Market Value shall be 
determined In accordance with Section 2214 of ILCA. That provision 
states:

         The secretary may develop a system for establishing the fair 
        market value of various types of land and improvements. Such 
        system may include determinations of fair market value based on 
        appropriate geographic units as determined by the Secretary. 
        Such a system may govern the amounts offered for the purchase 
        of interest in trust or restricted land under this chapter.

    So, to put it simply, the Settlement does not direct the Secretary 
to apply any specific methodology. So to correct these problems, we are 
recommending that the Committee add a new subsection (b) to ILCA 
Section 2214 which reads something like this:
    For purposes of a tribe's implementation of the Indian Land 
Consolidation Provisions of the Claims Settlement Act of 2010, the fair 
market value of a given acquisition shall be determined by a reasonable 
combination of the following factors:

        1. The appraised value of the land and the improvements on the 
        land;
        2. The benefit of the acquisition to the tribe and the greater 
        tribal community;
        3. The average annual earrings of the land, and interests on 
        the land;
        4. The potential earnings from the land over the next ten 
        years; and
        5. Any other factors that the Secretary considers to be 
        appropriate.

    By applying these factors, we may not acquire as many fractionated 
interests, but we will be in a much better position to acquire those 
interests that are stifling our development. So, in short Mr. Chairman, 
I and the other impacted tribes are asking this Committee is to take 
the Daines bill, add our recommended changes, and pass it as quickly as 
possible because the clock on the buyback program is running.
    Thank you for allowing me to appear here today. I will be happy to 
answer any questions that you may have.
                                 ______
                                 
Prepared Statement of Hon. Dave Archambault II, Chairman, Standing Rock 
                              Sioux Tribe
                              
                              
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   Prepared Statement of Hon. Mark L. Azure, President, Fort Belknap 
                            Indian Community
    Good Afternoon Mr. Chairman, Committee Members and guests, and 
thank you for providing the Assiniboine and Gros Ventre Tribes of Fort 
Belknap an opportunity to express our concerns about the oversight of 
the Land Buy-back Program enabled by the Cobell Settlement. My name is 
Mark Azure and I am the President of the Fort Belknap Indian Community 
Council, the governing body of the Assiniboine and Gros Ventre Tribes 
of the Fort Belknap Indian Reservation in Montana. I am a United States 
Army Veteran and a member of the Assiniboine Tribe of Fort Belknap. The 
Fort Belknap Indian Community consists of over 7,000 enrolled members 
of the two Tribes, for whom I am pleased to offer these comments.
    The Fort Belknap Indian Reservation was allotted through a separate 
act of Congress in 1921. Since that time, many original allottees died 
without wills, creating a significant fractionated interest problem. In 
the 1920s there were 1,189 individual allotments issued covering over 
650,000 acres on Fort Belknap. As early as the 1950s the Tribal Council 
utilized various sources of funding to purchase land from heirs of the 
original allotments. Our fathers and grandfathers on the Tribal Council 
saw the detrimental effect that fractionated interests was having on 
the ability to use lands.
    In recent years the source of income to purchase lands has dried 
up. According to the Department of Interior, in 2012, the Fort Belknap 
Reservation had 3,007 fractionated tracts encompassing 570,883 acres 
with 55,329 separate interests that could potentially be purchased if 
sellers were willing.
    At Fort Belknap, we have contracted a Tribal Land Department from 
the BIA to help administer Tribal lands under a P.L. 93-638 contract 
for over thirty-five years. To satisfy our tribal goals, the tribal 
government contributes $180,000 annually under its aid to tribal 
government contract. This action shows our deep commitment to tribal 
land acquisition. We also have experience with buying allotted lands 
from enrolled members. In fact, we have within the last few years spent 
$778,000 on land acquisitions in an attempt to purchase back land for 
our tribes, since the inception of our Land Purchase program in the 
1970s, over 150,000 acres of allotted lands have been purchased and 
added to Tribal inventories. Many other acres have been exchanged and 
consolidated. While these numbers may seem large, unfortunately, our 
lack of resources held back our overall plan to purchase fractionated 
interests from willing sellers and solve the large remaining 
fractionated interest problem that has plagued economic development.
    Our staff has attended national meetings of the Large Land-based 
Tribes for decades, emphasizing the need for Tribes to address 
fractionated interests. We have patiently waited ``our turn'' while 
other Tribes were successful in receiving funds to purchase 
fractionated interests.
    In 2012, we were excited to see the potential for our Tribal Land 
Purchase plans to receive funding through the Cobell Settlement. We 
looked at the December 18, 2012, Land Buyback Plan of the Department of 
Interior, and were ready to get moving. We attended numerous 
``listening'' conferences, and were frustrated that our many 
suggestions, made by Tribal leaders and staff with decades of 
experience and focus on enabling Tribal-run programs, seemed to receive 
little consideration.
    When no specific contracts were even proposed by March, 2013, we 
submitted a draft contract in April, 2013, to get the process moving. 
Five months to identify and enable existing Tribal programs to begin 
purchasing lands seemed to be long enough. We were then and continue to 
be very concerned that Congress set a ten year limit on the 
availability of these funds, beginning in November, 2012.
    Unfortunately, as of April 2014 we had received no feedback on our 
written proposal and agreement of April, 2013. Instead, DOI staff 
proposed a standardized ``boilerplate'' agreement to all Tribes in 
June, 2013. While somewhat discouraged about no response to our written 
proposal, we submitted a new agreement based on the ``boilerplate'' 
agreement in late June, 2013. We incorporated most of the assurances 
and procedural steps the DOI had sought in their draft, but upgraded 
the agreement to address needs at Fort Belknap.
    DOI, almost a year after funds became available for purchasing 
lands, in the fall of 2013, published a process whereby Tribes could 
contract with DOI, but advised that they wanted detailed proposals, and 
then they alone would respond and prepare their ``boilerplate'' 
agreement, with no changes to be expected from their prepared draft.
    We have reluctantly assented to this process and submitted a letter 
of interest and a resolution to the DOI. It is now twenty one months 
into the 120 month timeframe whereby these funds will be available. We 
know people are interested in selling interests. We have applications 
for land sales for millions of dollars through our existing processes. 
Regrettably, we are still unable to purchase these lands.
    Two of the goals in the 2012 DOI Buy-back Plan were to ``maximize 
tribal participation in the program'' and to ``establish and maintain 
clear communication throughout its operation''. \1\ These were 
appropriate goals. We embraced these goals, and spent significant 
Tribal resources in attending meetings and drafting agreements to 
implement these goals. We operated under good faith that DOI meant to 
implement these goals. It is now more than two years after those goals 
were drafted, and we are discouraged that neither of these goals are 
progressing much.
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    \1\ Updated Implementation, Land Buy-back Program for Tribal 
Nations, Summary, Page 2 of 32 (December, 2012).
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    As far as we know at this point, the Rocky Mountain Regional Office 
of the BIA does not have a clear plan to implement the Land Buy-back 
Program for Rocky Mountain Regional Tribes. Our attempts to initiate a 
specific process here at Fort Belknap have had no response. We know 
that historically, a single transaction to be recorded in the Billings 
Regional Title plant has taken six months. We cannot comprehend how 
that office could contemplate processing the 50,000+ transactions 
anticipated in the Buy-back plan from Fort Belknap alone over the next 
several years. We have not seen an upgrade in volume capacity in that 
very important office.
    These funds could mean an unprecedented influx of monies to our 
local economy. At Fort Belknap, the DOI projected $54 million of the 
total available would be needed to fund land purchases. These funds 
will impact our local economy in multiple ways. If we could administer 
the purchase program, local jobs will be created. The services needed 
to support these administrative efforts will support local businesses. 
Purchase funds will go to individuals who often are unemployed 
otherwise. Their families and extended families will all benefit, as 
will local businesses. Tribal government will benefit from the lease 
and use of lands purchased.
    But none of this is happening now, as the process the DOI is 
implementing is uncommunicative and ignores Tribal input. We have been 
saying the same things for over a year. The transcripts of the 
listening conferences will affirm our position that we are ready and 
willing and want to administer these funds now.
    The Cobell Settlement was a landmark in U.S. government and tribal 
relationships. It sought to remedy a long-standing problem of failed 
government administration of resources. Its focus was to redress 
problems created for individuals by failed government process. Yet, 
there are clear flaws in the implementation of the plan thus far.
    The amendment to the Indian Consolidation Act introduced by Montana 
Congressman Steve Daines does however bring some relief to the 
situation. The amendment, if passed, would provide choices to Indian 
Country that were not included in the original legislation. For 
instance, it extends the timeframe of the program from ten years to 
fifteen years, which would help us make up for all the lost time in the 
initial buy back implementation. Secondly, the amendment gives the 
authority to the DOI to deposit funds into an interest bearing account, 
so that tribes can greater benefit from the settlement. Lastly, it 
provides the option for tribes to contract or compact. This gives 
tribes more control over how their program will be organized and 
implemented. This allows for each tribe to work in the way that best 
suits them; since each tribe represents a separate and unique nation. 
In addition, the inclusion of this amendment would better encourage 
self-sufficiency, which is the intent of this program.
    Our leadership has often commented that it is ironic that funds 
paid to redress problems created by failed government administration 
should be proposed to be tightly administered by the same bureaucracy 
that created the problem.
    While not perfect, by any means, our people have elected leaders 
who have administered Tribal land buy-back programs for decades. We 
sincerely would like the opportunity to obtain the funds designated by 
Congress, apply them to our existing programs, upgrade those programs 
where necessary, and get busy with the land purchases Congress assigned 
these funds for in the settlement process.
    We know that the DOI has spent a lot of these monies in the last 
twenty one months on hearings, staff, and forms. We are quite concerned 
that millions of dollars which should have been spent on local efforts 
and purchasing lands are now gone, without the purchase of a single 
square foot of land at Fort Belknap! We respectfully ask this body to 
provide oversight and mandate corrections to get these monies to Tribes 
to facilitate Congress' intent to purchase fractionated interests and 
to strongly consider supporting the amendment that Congressman Daines 
is proposing to the Indian Consolidation Act.
    Thank you again for the opportunity to provide our perspective.

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