[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]







       TRIBAL AUTONOMY AND ENERGY DEVELOPMENT: IMPLEMENTATION OF  
    THE INDIAN TRIBAL ENERGY DEVELOPMENT AND SELF-DETERMINATION ACT  

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

                           OVERSIGHT HEARING

                               before the

               SUBCOMMITTEE ON INDIAN AND INSULAR AFFAIRS

                                 of the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________

                      Thursday, September 28, 2023

                               __________

                           Serial No. 118-65

                               __________

       Printed for the use of the Committee on Natural Resources






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                     COMMITTEE ON NATURAL RESOURCES

                     BRUCE WESTERMAN, AR, Chairman
                    DOUG LAMBORN, CO, Vice Chairman
                  RAUL M. GRIJALVA, AZ, Ranking Member

Doug Lamborn, CO
Robert J. Wittman, VA
Tom McClintock, CA
Paul Gosar, AZ
Garret Graves, LA
Aumua Amata C. Radewagen, AS
Doug LaMalfa, CA
Daniel Webster, FL
Jenniffer Gonzalez-Colon, PR
Russ Fulcher, ID
Pete Stauber, MN
John R. Curtis, UT
Tom Tiffany, WI
Jerry Carl, AL
Matt Rosendale, MT
Lauren Boebert, CO
Cliff Bentz, OR
Jen Kiggans, VA
Jim Moylan, GU
Wesley P. Hunt, TX
Mike Collins, GA
Anna Paulina Luna, FL
John Duarte, CA
Harriet M. Hageman, WY

                                     Grace F. Napolitano, CA
                                     Gregorio Kilili Camacho Sablan, 
                                         CNMI
                                     Jared Huffman, CA
                                     Ruben Gallego, AZ
                                     Joe Neguse, CO
                                     Mike Levin, CA
                                     Katie Porter, CA
                                     Teresa Leger Fernandez, NM
                                     Melanie A. Stansbury, NM
                                     Mary Sattler Peltola, AK
                                     Alexandria Ocasio-Cortez, NY
                                     Kevin Mullin, CA
                                     Val T. Hoyle, OR
                                     Sydney Kamlager-Dove, CA
                                     Seth Magaziner, RI
                                     Nydia M. Velazquez, NY
                                     Ed Case, HI
                                     Debbie Dingell, MI
                                     Susie Lee, NV

                    Vivian Moeglein, Staff Director
                      Tom Connally, Chief Counsel
                 Lora Snyder, Democratic Staff Director
                   http://naturalresources.house.gov
                                 ------                                

               SUBCOMMITTEE ON INDIAN AND INSULAR AFFAIRS

                     HARRIET M. HAGEMAN, WY, Chair

                JENNIFFER GONZALEZ-COLON, PR, Vice Chair

               TERESA LEGER FERNANDEZ, NM, Ranking Member

Aumua Amata C. Radewagen, AS         Gregorio Kilili Camacho Sablan, 
Doug LaMalfa, CA                         CNMI
Jenniffer Gonzalez-Colon, PR         Ruben Gallego, AZ
Jerry Carl, AL                       Nydia M. Velazquez, NY
Jim Moylan, GU                       Ed Case, HI
Bruce Westerman, AR, ex officio      Raul M. Grijalva, AZ, ex officio





















                                 ------                                
                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Thursday, September 28, 2023.....................     1

Statement of Members:

    Hageman, Hon. Harriet M., a Representative in Congress from 
      the State of Wyoming.......................................     1

    Leger Fernandez, Hon. Teresa, a Representative in Congress 
      from the State of New Mexico...............................     3

Statement of Witnesses:

    Baker, Hon. Melvin J., Chairman, Southern Ute Indian Tribe, 
      Ignacio, Colorado..........................................     5
        Prepared statement of....................................     6
        Questions submitted for the record.......................    12

    Desautel, Cody, Executive Director, Confederated Tribes of 
      the Colville Reservation, Nespelem, Washington.............    12
        Prepared statement of....................................    14
        Questions submitted for the record.......................    16

    Lovesee, Nicholas, Director of Policy, Native American 
      Finance Officers Association, Washington, DC...............    17
        Prepared statement of....................................    19
        Questions submitted for the record.......................    22

    Becker, Bidtah, Chief Legal Counsel, Office of the President 
      and Vice President, Navajo Nation, Window Rock, Arizona....    23
        Prepared statement of....................................    24
        Questions submitted for the record.......................    25
                                     


 
     OVERSIGHT HEARING ON TRIBAL AUTONOMY AND ENERGY DEVELOPMENT: 
                   IMPLEMENTATION OF THE INDIAN TRIBAL ENERGY 
                    DEVELOPMENT AND SELF-DETERMINATION ACT 

                              ----------                              


                      Thursday, September 28, 2023

                     U.S. House of Representatives

               Subcommittee on Indian and Insular Affairs

                     Committee on Natural Resources

                             Washington, DC

                              ----------                              

    The Subcommittee met, pursuant to notice, at 10:21 a.m., in 
Room 1334 Longworth House Office Building, Hon. Harriet Hageman 
[Chairwoman of the Subcommittee] presiding.
    Present: Representatives Hageman, LaMalfa, Carl, Westerman; 
and Leger Fernandez.

    Ms. Hageman. The Subcommittee on Indian and Insular Affairs 
will come to order. Without objection, the Chair is authorized 
to declare a recess of the Subcommittee at any time.
    The Subcommittee is meeting today to hear testimony on 
Tribal Autonomy and Energy Development: Implementation of the 
Indian Tribal Energy Development and Self-Determination Act; I 
like that name. Under Committee Rule 4(f), any oral opening 
statements at hearings are limited to the Chairman and the 
Ranking Minority Member. I therefore ask unanimous consent that 
all other Member's opening statements be made part of hearing 
record if they are submitted in accordance with Committee Rule 
3(o).
    Without objection, so ordered.
    I will now recognize myself for an opening statement.

 STATEMENT OF THE HON. HARRIET M. HAGEMAN, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF WYOMING

    Ms. Hageman. This camera is kind of in our way, and I 
apologize for that. We will try to fix that next time.
    Tribes and individual Indians control roughly 56 million 
acres of land, much of which holds untapped energy and mineral 
potential. For example, 30 percent of the coal reserves west of 
the Mississippi River are found on tribal lands. An additional 
approximately 44 million acres of land in Alaska are owned in 
fee simple by Alaska Native corporations who have also sought 
to develop mineral and energy resources on those lands.
    These untapped resources can be a key revenue source for 
tribes, particularly in rural areas, and can increase the U.S. 
supply of energy. And several tribes have chosen to develop 
those resources for the benefit of their tribes, tribal 
members, and surrounding communities. However, development of 
projects on tribal trust lands requires jumping through more 
hoops, more bureaucracy, and involves more agencies than on any 
other type of land. We need to change that.
    A tribe must also go through the Bureau of Indian Affairs 
as well as any other applicable Department of the Interior 
agencies and receive approval before any energy project can 
move forward. This increases costs for developing any projects, 
surface or subsurface, on Indian lands and impacts private 
investment opportunities that a tribe may want to pursue.
    Congress has worked toward easing these restrictions to 
provide a more even playing field for our tribes, and in 2005, 
Congress authorized the Tribal Energy Resource Agreements, or 
TERAs, as a way to give tribes more autonomy over energy 
projects on their lands. Once a tribe has established a TERA 
and had it approved by the Department of the Interior, a tribe 
could enter into energy project agreements with developers 
without the need for Secretarial approval for each project. 
Yet, tribes had more questions than answers after regulations 
governing the creation of TERAs were finalized, and no tribe 
has chosen to go through the process to implement one.
    In an effort to streamline the TERA process, as well as 
benefit other tribal energy goals, Congress passed the Indian 
Tribal Energy Development and Self-Determination Act amendments 
in 2018. Despite its passage, issues with the TERA process have 
remained and no tribe has yet entered into these agreements. 
Other provisions of the 2018 law were either not fully 
implemented, like the Biomass Demonstration Project, or were 
not fully taken advantage of, like the extended leasing 
authority provisions.
    I look forward to talking with our witnesses as each have 
dealt with the difficult energy development landscape for 
tribes. It is important that we hear from the Indian tribes 
about the barriers, remaining issues, and what future 
activities they wish to seek to meet energy autonomy.
    As I have said before, expanding the ability of tribes to 
use their land in ways without needing to come to the 
government for approval is crucial for furthering self-
determination and economic security. Each tribe is uniquely 
situated within their lands, their culture, and their history. 
Tribal governments already seek to make the best decisions for 
their members, for their social, cultural, and economic 
security.
    Congress has a responsibility to all Americans to work 
toward abundant, affordable energy and ensure tribes are able 
to develop their energy resources as best suits the needs and 
desires of each community. Energy development on tribal lands 
is not only beneficial for our tribes but for the United States 
as a whole, for each and every one of us. We need an all-of-
the-above energy strategy, and I do not think that this can be 
accomplished without the partnership of federally recognized 
tribes.
    Thank you to the witnesses for being with us today. I look 
forward to our discussion and I look forward to continuing this 
conversation about what tribal autonomy and energy policy 
should be in the future.
    The Chair now recognizes the Ranking Minority Member for 
any statement.

STATEMENT OF THE HON. TERESA LEGER FERNANDEZ, A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF NEW MEXICO

    Ms. Leger Fernandez. Thank you so much, Madam Chair, and 
good morning to everybody. [Speaking Native language], and 
thank you to our witnesses for joining us today. I only know 
good morning in a few languages, including Navajo.
    The Federal Government has a trust responsibility to 
promote tribal self-government and sovereignty of American 
Indians and Alaska Natives, including their ability to develop 
their economy and their natural resources. Today's hearing will 
focus on the need to uphold that responsibility and improve the 
Acts that we just heard about, because we know that the Tribal 
Autonomy and Energy Development Acts are not working, or else 
tribes would be using them.
    And I have worked with tribes for over three decades on 
both renewable energy and fossil fuel projects. I worked on 
trying to get one of those TERAs written and passed. But 
throughout those decades, I always heard the same thing, tribes 
want and need to be in control of their projects. Everybody is 
shaking their heads up and down because we know that is a fact. 
Tribes have incredible opportunities for energy development, 
and when tribes are in control, we know they do a better job 
protecting their environment and cultural resources.
    An interesting fact. All of us in this room know that 
tribes have nearly 7 percent of the nation's potential for 
large-scale clean energy projects like solar, window, and 
geothermal. We know tribes don't come anywhere near to meeting 
that potential. But there is no reason they shouldn't. Our job 
here in Congress is to give tribes the opportunities to realize 
that potential.
    Last year, Congress took positive steps to support tribal 
energy development, particularly through the Inflation 
Reduction Act. The IRA increased funding for the Tribal Energy 
Loan Guarantee Program from about $2 billion to $20 billion to 
support tribal investment in energy-related projects. And 
unlike the TERA, we are seeing tribes take advantage of that 
funding.
    It also provided tribes access to direct-pay tax 
incentives. As we know, before the IRA, existing tax incentives 
didn't work for tribes because you are governmental and don't 
pay those taxes. This change will help tribal energy projects 
build more quickly and affordably through our existing clean 
energy programs.
    The IRA also provided $150 million for the Tribal 
Electrification Program. This program provides tribes with 
financial and technical assistance for getting zero emission 
electricity to their homes. I always like to say, we need to 
build that Route 66 of renewable energy so we can transport 
over the grid what we need to the people who need it.
    Unfortunately, all of our witnesses today know too well 
that many tribes continue to face barriers accessing all of our 
programs and the resources needed for energy development. For 
example, states receive administrative funding for energy 
projects, but tribes often don't. Federal agencies have 
oversight over nearly every significant land transaction on 
tribal lands: appraisals, leasing, permits, rights-of-ways, and 
environmental reviews.
    Renewable energy developers may find it takes twice as long 
to develop a project in Indian Country than elsewhere. The 
volume of bureaucratic red tape and lack of coordination deters 
investment in energy development, and the Chair and I share the 
concern of addressing that.
    In 2017, Congress amended the Indian Tribal Energy and 
Self-Determination Act to provide direction and clarity so 
tribes could be afforded the same opportunities as states and 
localities. But did they really help? We still don't have a 
tribe utilizing the TERA. I think because, in my experience, 
the TERA sort of replicated all of the bureaucratic red tape 
that was already in existence. So, we need to do more. We need 
to continue to work on simplification so tribes can take 
advantage of this.
    I truly look forward to hearing from our witnesses. I have 
worked with several of your tribes on different issues over the 
years, and I am very curious as to what you think we could do 
best.
    But I also want to raise that we are barreling toward a 
government shutdown right now. I am going to ask you how a 
government shutdown will impact an already lengthy process for 
getting approvals. I hope we don't have it, but once we get 
past a government shutdown, we know there will be an even 
bigger backlog. And I am very concerned about proposed cuts to 
the Department of the Interior and will also want to hear your 
thoughts on whether we should increase funding so that we could 
get more of these projects approved and what potential cuts 
would mean to getting your projects approved.

    With that, I yield back, and thank you very much.

    Ms. Hageman. Thank you. I will now introduce our witnesses 
for our panel.

    The Honorable Melvin J. Baker, Chairman, Southern Ute 
Indian Tribe, Ignacio, Colorado; Mr. Cody Desautel, Executive 
Director, Confederated Tribes of the Colville Reservation, 
Nespelem, Washington; Mr. Nicholas Lovesee, Director of Policy, 
Native American Finance Officers Association, Washington, DC; 
and Ms. Bidtah Becker, Chief Legal Counsel, Office of the 
President and Vice President, Navajo Nation, Window Rock, 
Arizona.

    Thank you for being here. We appreciate your willingness to 
come and talk to us about these extremely important issues.

    Let me remind the witnesses that under Committee Rules, 
they must limit their oral statements to 5 minutes, but their 
entire statement will appear in the hearing record. To begin 
your testimony, please press the ``talk'' button on the 
microphone. We use timing lights. When you begin, the light 
will turn green. When you have 1 minute left, the light will 
turn yellow. At the end of 5 minutes, the light will turn red, 
and I will ask you to please complete your statement. I will 
also allow all witnesses in the panel to testify before Member 
questioning.

    The Chair now recognizes Chairman Melvin Baker for 5 
minutes.

 STATEMENT OF THE HON. MELVIN J. BAKER, CHAIRMAN, SOUTHERN UTE 
                INDIAN TRIBE, IGNACIO, COLORADO

    Mr. Baker. [Speaking Native language.] Good morning. 
Welcome, everybody.
    Good morning, Chair Hageman, Ranking Member Leger 
Fernandez, and other Committee members.
    My name is Melvin Baker, Chairman of the Southern Ute 
Indian Tribe. Thank you for allowing us to speak here today on 
behalf of the Tribe.
    For decades, our tribal leaders have come before 
congressional committees to discuss the prudent development of 
energy resources in Indian Country. The subject of today's 
hearing is tied to issues of tribal sovereignty.
    Our Tribe has just under 1,500 members. Our Reservation 
consists of approximately 700,000 acres of land in Southwestern 
Colorado with over 300,000 surface acres of the Reservation 
held in trust. The Tribe is also the beneficial owner of 
additional severed mineral estates held in trust for the Tribe.
    The Tribe has developed a record of sound managerial 
experience and business practice. The Southern Ute Indian Tribe 
was the first in the nation with a AAA credit rating. We are 
the largest employer in Southwest Colorado and our members have 
jobs, health insurance, and the opportunity to obtain a college 
or vocational degree. Our elders have stable retirement 
benefits, and our investment portfolio is diverse in energy and 
non-energy assets both on and off the Reservation that span 16 
states. We are on the way to providing our grandchildren and 
their grandchildren the opportunity to maintain our Tribe, our 
culture, and our lands in perpetuity.
    Through the use of Federal self-determination policy, our 
Tribe has learned that we can do a better job of developing 
programs and providing services to our members than Federal 
agencies can. Conservation is fundamental to our Ute identity, 
and we have been proactive in overseeing the environmental 
protection of our lands while effectively managing our energy 
resources.
    In 1990, the Tribe established a water quality program to 
protect and preserve the quality of the Tribe's water resources 
by regulating the discharge of pollutants in the tribal waters. 
In 2012, the Tribe pioneered the Nation's first tribal clean 
air program. Other departments within the Tribe assist in 
monitoring wildlife enhancement, habitat, and preserving 
culture and archeologically resources.
    Federal law still requires Federal review and approval of 
most basic realty transactions occurring on tribal trust lands. 
Realty transactions trigger an environmental review under NEPA. 
The NEPA review second guesses the Tribal Council's decisions 
on how to best use our tribal trust lands and cause significant 
delays and lost opportunities.
    In 2016, the Tribe spent significant time and funding on a 
supplemental EIS for energy development. The Federal agency co-
leading with the Tribe had removed itself. This has been left 
unresolved and the Tribe does not have a clear path forward.
    To eliminate administrative delays and in recognition of 
the ability of tribal governments to protect their own 
interests, Congress authorized tribes to exercise greater 
control over their land through the HEARTH Act. Our Tribe's 
environmental review code and service leasing code received 
Secretarial approval under the HEARTH Act earlier this year.
    Obtaining timely approval of oil and gas leases and 
developmental permits has also been challenging. The Energy 
Policy Act of 2005 has not been as successful as the HEARTH Act 
since no tribe has submitted a Tribal Energy Resource 
Agreement, or TERA, to the Secretary for final review and 
approval. A TERA is a bilateral agreement with the Secretary 
negotiated with the tribe that allows the tribe to contract and 
approve energy agreements and leases without further Secretary 
approval.
    Our Tribe submitted input in 2014 to the Senate Committee 
on Indian Affairs as to why no tribe had entered into a TERA. 
One of the reasons is that the BIA regulations minimize tribal 
authority reserving to the Federal Government an array of 
functions called inherent Federal functions, an undefined term 
that deluded the Act's goal of fostering tribal decision making 
and self-determination.
    Despite positive amendments to the law in 2018, still no 
tribe has entered into a TERA. Energy-producing tribes like the 
Southern Ute are still waiting for promised clarification 
regarding inherent Federal functions. The lack of clarity on 
this item shows a disregard by the Interior for the ambiguous 
objectives of Congress. It also undermines the time, expense, 
and the lost opportunities associated with participating in the 
uncertain TERA process.
    I trust this testimony provides backgrounds about how TERAs 
became embraced in law and how Interior's regulations were 
developed. We still believe that TERAs are a valuable option 
for tribes, including our Tribe, should clarification be 
provided on inherent Federal function.
    I would like to thank the Committee for the opportunity to 
present this testimony this morning.
    [Speaking Native language.] Thank you.

    [The prepared statement of Mr. Baker follows:]
Prepared Statement of the Honorable Melvin J. Baker, Chairman, Southern 
                       Ute Indian Tribal Council

I. INTRODUCTION

    Good morning, Chair Hageman, Ranking Member Leger-Fernandez, and 
other Committee members. I am Melvin J. Baker, Chairman of the Southern 
Ute Indian Tribal Council, the governing body of the Southern Ute 
Indian Tribe. It is an honor to appear before you today to discuss a 
subject of major importance. For decades, our Tribal leaders have come 
before Congressional committees and subcommittees to discuss the 
prudent development of energy resources in Indian Country. Prudent 
development of Tribal energy resources allows Tribal economies to grow 
and also helps meet the energy needs of the American people. The 
subject of today's hearing is tied to issues of Tribal sovereignty. I 
trust that our comments will be of value to the Committee.
    In this testimony, I will describe our Reservation and how energy 
development has affected our people. I also want to share with you our 
role in seeking passage of the Indian Tribal Energy Development and 
Self-Determination Act of 2005 (25 U.S.C. Sec. Sec. 3501-3506) and the 
amendments to that law enacted in 2018. The job of making that 
legislation work for Tribes is not over, and I want to share with you 
what we see as obstacles to its effectiveness. With that, let me first 
describe our Tribe and where I come from.
II. THE SOUTHERN UTE INDIAN TRIBE AND OUR RESERVATION

    As the oldest inhabitants to what is now the State of Colorado our 
Tribe has just under 1,500 members. Our Reservation consists of 
approximately 700,000 acres of land located in southwestern Colorado, 
near the Four Corners area. Some 311,000 surface acres of the 
Reservation are held in trust by the federal government for the benefit 
of the Tribe; however, the Tribe is also the beneficial owner of 
additional severed mineral estates held in trust for the benefit of the 
Tribe within the Reservation. Although the bulk of the Reservation 
involves tribal trust lands, interspersed throughout the Reservation 
are federal, state, and private lands, as well as some Indian allotted 
lands.
    Through financial discipline and farsighted leadership, the Tribe 
has developed a record of sound managerial experience and business 
practice. For instance, the Tribe was the first Tribe in the nation 
with a AAA+ credit rating, which was earned through years of steady 
governance and successful business management. The path to successful 
economic development has had significant challenges. Fifty years ago, 
our Tribal Council had to suspend the practice of distributing per 
capita payments to Tribal members because the Tribe could not afford 
them. Today the Tribe is the largest employer in southwest Colorado 
with more than 1,000 employees. The Tribe provides health insurance for 
its Tribal members and operates its own health clinic. The Tribe funds 
educational opportunity so that all members may obtain a college or 
vocational degree and runs its own Montessori Academy for elementary 
and middle school children. The campus of our Tribal headquarters is 
dotted with state-of-the art buildings, including a justice center, 
museum, and recreational health facility. This success was not an 
accident; it is the product of sustained effort and discipline.
    Without question, the Tribe's economic success has been tied to 
development of the Tribe's oil and gas resources. Successful 
development of those resources, principally coalbed methane gas 
(``CBM''), has resulted in a higher standard of living for our Tribal 
members. Our members have jobs. Our educational programs provide 
meaningful opportunities at all levels. Our elders have stable 
retirement benefits. We have exceeded our financial goals, and we are 
well on the way to providing our grandchildren and their grandchildren 
the opportunity to maintain our Tribe, our culture, and our lands in 
perpetuity.
    Successful energy development has also enabled the Tribe to invest 
in diverse, non-energy projects, strengthening the foundation for long-
lasting economic prosperity. For example, the Tribe has made real 
estate investments in multiple markets. These investments include 
residential, commercial, industrial, and hotel properties in 
California, Colorado, Texas, Kansas, Illinois, Ohio, Florida, Maryland, 
New Jersey, and Tennessee. Even greater diversification is reflected in 
the Tribe's investments in managed private equity funds involving 
hundreds of portfolio companies. Returns on these investments have 
spurred further economic growth for the Tribe, which would not have 
been possible but for the Tribe's active efforts to control and develop 
its energy resources.
III. TAKING CONTROL OF OUR OWN RESOURCES: TRIBAL SOVEREIGNTY AND SELF-
        GOVERNMENT

    Indian self-determination has been the hallmark of federal Indian 
policy since 1970, and our Tribe has learned that we can do a better 
job of developing programs for the Tribe and providing services to our 
members than federal agencies can. In some instances, the Tribe has 
chosen to enter into ``638 contracts'' under the Indian Self-
Determination and Education Assistance Act, 25 U.S.C. Sec. Sec. 5301, 
et seq., which authorizes the Tribe to do the tribally-related work of 
federal agencies and receive the federal funding that would have gone 
to a federal agency to perform that function. In other instances, the 
lack of federal funding or focus has required the Tribe to simply fill 
the void with its own programs and services.
    Energy development on our lands has evolved over time. Our 
Reservation is part of the San Juan Basin, which has been a prolific 
source of oil and natural gas production since the 1940s. Beginning in 
1949, the Tribe began issuing mineral leases under the supervision of 
the Secretary of the Interior. For decades, we maintained a passive 
role, receiving modest royalty revenue, but we were not engaged in any 
comprehensive resource management planning.
    That changed in the 1970s as we and other energy resource Tribes in 
the West recognized the potential importance of monitoring oil and gas 
companies for lease compliance and keeping a watchful eye on the 
federal agencies charged with managing our resources. In 1974, the 
Tribal Council placed a moratorium on oil and gas development on the 
Reservation until the Tribe could gain a better understanding and more 
control over that process. The moratorium on leasing remained in place 
for 10 years while the Tribe compiled information and evaluated the 
quality and extent of its mineral resources.
    A series of events in the 1980s laid the groundwork for our 
subsequent success in energy development. In 1980, the Tribal Council 
established an in-house Energy Department, which spent years gathering 
historical information about our energy resources and lease records. In 
1982, following the Supreme Court's decision in Merrion v. Jicarilla 
Apache Tribe, 455 U.S. 130 (1982), the Tribal Council instituted a 
severance tax, which has produced more than $900 million in revenue for 
the Tribe over the last four decades.
    With the enactment of the Indian Mineral Development Act of 1982, 
25 U.S.C. Sec. Sec. 2101-2108, (``IMDA''), we carefully negotiated 
mineral development agreements with oil and gas companies involving 
unleased lands and insisted upon flexible provisions that vested the 
Tribe with business options and greater involvement in resource 
development. Because the Tribe's leaders believed that the Tribe could 
do a more thorough job of monitoring the royalty payment practices of 
oil and gas companies, shortly after passage of the Federal Oil and Gas 
Royalty Management Act of 1982, 30 U.S.C. Sec. Sec. 1701, et seq., the 
Tribe entered into a cooperative agreement with the Minerals Management 
Service (``MMS'') (later named the Office of Natural Resource Revenue) 
permitting the Tribe to conduct its own royalty accounting and auditing 
under that agency's ultimate oversight. The Tribe's award-winning 
royalty audit program has been instrumental in recovering tens of 
millions of dollars of delinquent royalties, interest, and civil 
penalties.
    In 1992, we started our own gas operating company, Red Willow 
Production Company, which was initially capitalized through a 
Secretarially-approved plan for use of $8 million of tribal trust funds 
held by the Secretary as part of a settlement of our reserved water 
right claims. Through conservative acquisition of on-Reservation 
leasehold interests, we began operating our own wells and received 
working interest income as well as royalty and severance tax revenue. 
Today, Red Willow successfully operates hundreds of wells on the 
Reservation. It has also been a regional leader in successful 
development of horizontal drilling in coal formations, which has 
increased CBM production volumes while dramatically decreasing adverse 
surface impacts.
    In 1994, we participated with a partner to purchase one of the main 
pipeline-gathering companies on the Reservation. Today, the Tribe is 
the majority owner of Red Cedar Gathering Company, which provides 
gathering, processing, and treating services throughout the 
Reservation. Ownership of Red Cedar Gathering Company allowed us to put 
the infrastructure in place to further develop and market CBM from 
Reservation lands and has provided a significant source of revenue for 
the Tribe.
    Just as we have relied economically on oil and gas development, we 
have also been active in overseeing environmental protection. In 1990, 
the Tribe established a Water Quality Program to protect and preserve 
the quality of the Tribe's water resources through management of 
various Clean Water Act programs. With support from the U.S. 
Environmental Protection Agency (``EPA''), the Tribe has established 
its own water quality standards and is actively involved in regulating 
the discharge of pollutants into tribal waters on the Reservation. In 
2012, the Tribe became the first tribe in the country to operate its 
own clean air program pursuant to the Federal Clean Air Act, 42 U.S.C. 
Sec. Sec. 7401, et seq. Other departments within the Tribe's 
governmental organization assist in monitoring wildlife, enhancing 
habitat, and preserving cultural and archaeological resources on the 
Reservation.
IV. MORE RECENT EXAMPLES OF TRIBAL SELF-DETERMINATION

    Despite the Tribe's decades-long success in managing its own 
affairs and conducting complex business transactions, both on and off 
the Reservation, federal law and regulations still require federal 
review and approval of the most basic realty transactions occurring on 
the lands held in trust for the Tribe. Federal approval constitutes 
federal action, which triggers environmental review under the National 
Environmental Policy Act (``NEPA''), 42 U.S.C. 4332(2)(C), even for 
simple and straightforward realty transactions. In addition to second-
guessing the Tribal Council's decisions on how to use its tribal trust 
lands, federal agency NEPA review can cause significant delays and lost 
opportunities.
    To eliminate administrative delays, and in recognition of the 
ability of Tribal governments to protect their own interests, Congress 
has taken steps in recent years authorizing Tribal governments to 
exercise greater control over Tribal lands. Under the HEARTH Act, for 
example, once tribal regulatory and environmental review procedures 
have been approved by the Secretary of the Interior, Tribes may make 
final decisions in issuing tribal surface leases without prior review 
and approval of the Secretary. See 25 U.S.C. Sec. 415(h), Helping 
Expedite Affordable and Responsible Tribal Homeownership Act of 2012, 
Pub. L. No. 112-151, 126 Stat. 1150 (``HEARTH Act''). Our Tribe's 
comprehensive environmental review code and surface leasing code 
received Secretarial approval under the HEARTH Act earlier this year. 
That approval does not extend to mineral leasing, however. As addressed 
below, the Indian Tribal Energy Development and Self-Determination Act, 
which does address mineral leasing, is more complicated than the HEARTH 
Act in terms of transferring final approval authority over energy 
agreements and development from the Secretary to Tribes.
V. THE INDIAN TRIBAL ENERGY DEVELOPMENT AND SELF-DETERMINATION ACT OF 
        2005

    Just as Tribes had encountered delays in obtaining Secretarial 
approval of surface leases, obtaining timely approval of oil and gas 
leases and associated developmental permits has often been challenging. 
More than 20 years ago, in a memorandum dated June 30, 2002, our legal 
counsel informed the legal counsel for the Senate Committee on Indian 
Affairs, as follows:

        The problems with Secretarial approval of tribal business 
        activities include an absence of available expertise within the 
        agency to be helpful . . . . Some structural alternative is 
        needed. The alternative should be an optional mechanism that 
        allows tribes to elect to escape the bureaucracy for mineral 
        development purposes, provided the Secretary has a reasonable 
        indication that an electing tribe will act prudently once cut 
        free.

Congress responded to the concerns of energy producing Tribes in the 
course of revising the Nation's energy policy.

    The Energy Policy Act of 2005, 42 U.S.C. Sec. Sec. 15801, et seq., 
contains a separate, stand-alone Indian energy chapter, ``Title V--the 
Indian Tribal Energy Development and Self-Determination Act.'' See Act 
of August 8, 2005, Public L. No. 109-58, Title V, 119 Stat. 764-779 
(amending Title XXVI of The Energy Policy Act of 1992 (25 U.S.C. 
Sec. Sec. 3501-3506)). Significantly, Title V authorizes an Indian 
tribe, in its discretion, to negotiate a bilateral agreement with the 
Interior Secretary, known as a Tribal Energy Resource Agreement 
(``TERA''), governing the rights and responsibilities for mineral 
leasing of tribal trust lands. See 25 U.S.C. Sec. 3504. Once a TERA is 
approved by the Secretary, that tribe would be free to negotiate and 
grant energy-related leases, enter into energy-related business 
agreements, and issue rights-of-way for such things as pipelines and 
electric transmission facilities without prior Secretarial review and 
approval. For various reasons, some of which are identified below, no 
Tribe has submitted a TERA to the Secretary for final review and 
approval.

    After passage of the TERA legislation, the Senate Committee on 
Indian Affairs held hearings in which it sought input from energy 
producing Tribes as to why no Tribe had entered into a TERA. Our Tribe 
submitted formal comments addressing that issue. In our comments of 
April 30, 2014, we identified the following potential reasons for why 
no TERA had been consummated:

  1.  The BIA regulations implementing Title V's TERA provisions (25 
            C.F.R. Part 224) minimized the scope of authority that 
            could be obtained by a TERA tribe by reserving to the 
            federal government an array of functions--called ``inherent 
            federal functions''--an undefined term that potentially 
            diluted the act's goal of fostering tribal decision-making 
            and self-determination.

  2.  Unlike ``638 contracts'' carried out by Indian tribes under the 
            Indian Self-Determination and Education Assistance Act, the 
            TERA legislation provided no funding to Indian tribes even 
            though TERA-contracting tribes would be assuming duties and 
            responsibilities typically carried out by the United 
            States.

  3.  One of the statutory conditions for a TERA, the establishment of 
            a tribal environmental review process, requires public 
            comment, participation, and appellate rights with respect 
            to specific tribal energy projects, which some tribes 
            considered to be an unacceptable opening of tribal 
            decisions to outside scrutiny, including from individuals 
            with no local connection to the affected tribe or project.

  4.  The statutory standards for measuring a tribe's capacity to enter 
            into a TERA were vague and unclear.

  5.  The extensive process of applying for and obtaining a TERA was 
            simply too time-consuming and distracting to merit 
            disruption of ongoing tribal governmental challenges.

    Although it took several years following those hearings before 
changes were made, in 2018 Congress amended the TERA statute in several 
significant ways. See Act of Dec. 18, 2018, ``Indian Tribal Energy 
Development and Self-Determination Act Amendments of 2017,'' Public L. 
No. 115-325 Sec. 103, 132 Stat. 4445-4465 (amending Section 2604 of the 
Energy Policy Act of 1992 (25 U.S.C. Sec. 3504) (``2018 Amendments'').

VI. 2018 AMENDMENTS TO THE TERA STATUTE

    The 2018 Amendments addressed many of the concerns that had been 
raised by Tribes related to implementation of TERAs. For example, in 
determining what Tribes were qualified to enter into a TERA, Congress 
replaced the vague requirement of demonstrated ``capacity to regulate 
the development of energy resources,'' with a more concrete test of 
successful administration of ``638 contracts'' involving ``management 
of tribal land or natural resources'' for a period ``not less than 3 
consecutive years.'' 2018 Amendments, Sec. 103(a), see 25 U.S.C. 
Sec. 3504(e)(2)(B)(XII)). On another point, although Congress retained 
the requirement that a TERA Tribe develop environmental review 
procedures as a condition for entering into a TERA, the nature of those 
tribal environmental review procedures was refined to provide the 
public notification of and a reasonable opportunity to comment on 
``significant environmental impacts of the proposed action.'' Id., see 
25 U.S.C. Sec. 3504(e)(2)(C)(i)). As to funding, Congress directed that 
Tribes with approved TERAs will receive from the Secretary the amounts 
that would have been expended but were not expended ``as a result of an 
Indian tribe carrying out the activities'' under a TERA. Id., see 25 
U.S.C. Sec. 3504(g)(1). To facilitate the processing of a TERA 
application, Congress also imposed a 271-day deadline on the 
Secretary's disapproval of a TERA, which, if not met, would result in 
automatic approval of the TERA. Id., see 25 U.S.C. Sec. 3504(e)(2)(A).

    In addition, the 2018 Amendments expanded the scope of approvable 
tribal actions that could be taken under a TERA to include transactions 
involving electric generation, transmission, and distribution 
facilities (including those associated with renewable energy) (25 
U.S.C. Sec. 3504(a)(B)(i)) and transactions involving processing and 
treating facilities involving production from tribal lands 
(Sec. 3504(a)(B)(ii)). The 2018 Amendments confirmed that pooling or 
communitization agreements could be approved by a Tribe under a TERA 
(25 U.S.C. Sec. 3504(a)(1)(C)). Collectively, the 2018 Amendments, 
which were adopted by unanimous consent in both the House and the 
Senate, reflected significant changes contributing to the 
attractiveness of TERAs as an option for electing Tribes. To be sure, 
as with the original 2005 enactment, TERA Tribes would be principally 
responsible for the business consequences of the negotiated terms of 
their business agreements; however, similar provisions had not 
deflected Tribes from seeking HEARTH Act approvals for surface leasing. 
Despite the positive changes contained in the 2018 Amendments, no Tribe 
has yet entered into a TERA with the Secretary.

VII. THE SECRETARY'S IMPLEMENTING REGULATIONS AND INHERENT FEDERAL 
        FUNCTIONS

    The TERA provisions contained in the 2005 Act directed the 
Secretary to adopt implementing regulations within 1 year of the 
effective date of the legislation, i.e., by August 8, 2006. See 25 
U.S.C. Sec. 3504(e)(8). Recognizing the challenges that the Interior 
Department would have in meeting that deadline, our Tribe volunteered 
to assist the Secretary in preparing a preliminary set of draft 
regulations, and then-Assistant Secretary James Cason accepted that 
offer. In collaboration with representatives from the Department of the 
Interior, including the Interior Solicitor's office, a small working 
group proceeded with that task, and a preliminary draft was submitted 
to the Secretary's representative in early 2006. The product generated 
by that working group assisted the Secretary in developing proposed 
regulations that would later be subject to comment and refinement under 
the rulemaking process prescribed by the Administrative Procedures Act. 
The Secretary issued implementing regulations on March 10, 2008 (73 
Fed. Reg. 12, 821).

    At the outset, we recognized that administrative delays associated 
with proposed federal agency approvals were not limited simply to 
minerals agreements or rights-of-way, but often involved the subsequent 
issuance of operational permits related to those documents. For 
example, the approval of an oil and gas lease or IMDA minerals 
agreement by the BIA, did not have any effect on the timing of the 
Bureau of Land Management's approval of an application for a permit to 
drill a well on those affected lands. With that in mind, we sought to 
authorize a Tribe to seek, not just mineral lease approval, but other 
Interior agency authority needed to implement such a lease. The working 
group was supportive of that approach. When the final implementing 
regulations were issued, however, 25 C.F.R. Sec. 224.52(c) stated as 
follows:

        [A TERA may] include assumption by the tribe of certain 
        activities normally carried out by the Department, except for 
        inherently Federal functions . . . .

(emphasis added). The term ``inherently Federal functions'' was not 
defined in the Secretary's implementing regulations. Despite repeated 
efforts to get meaningful clarification from the Interior Department as 
to what that exception means, we have been unable to do so.

    Among other provisions in the 2018 Amendments, Congress explicitly 
provided that in its TERA application a tribe could:

        at the option of the Indian tribe, identify which functions, if 
        any, authorizing any operational or development activities 
        pursuant to a lease, right-of-way, or business agreement 
        approved by the Indian tribe, that the Indian tribe intends to 
        conduct.

25 U.S.C. Sec. 3504(e)(B)(iii)(XIII). Following enactment of the 2018 
Amendments, the Secretary was again directed to promulgate implementing 
regulations, and, in light of the statutory language set forth above, 
that rulemaking provided another opportunity to find out what the 
Department would preclude a tribe from undertaking under a TERA. In 
response to comments submitted during that rulemaking, the BIA stated 
as follows:

        D. Inherently Federal Functions

        Comment: Several Tribes and other commenters expressed the need 
        to define ``inherently Federal functions'' to clarify what 
        functions are not available for Tribes to undertake in a TERA. 
        According to these Tribes, a definition is necessary for 
        several reasons, including to address issues, provide 
        certainty, and ensure consistency of interpretation. A few 
        requested that the definition exclude basic minerals 
        development functions, like applications for permits to drill, 
        thereby allowing Tribes to undertake these functions through 
        TERAs . . . .

        Response: The Department has undertaken efforts to define 
        ``inherently Federal functions'' based on years of Tribal input 
        and anticipates releasing a list of functions that it has 
        determined to be ``inherently Federal'' in the near future.

BIA, ``Tribal Energy Resource Agreements,'' Final Rule, 84 Fed. Reg. 
69602 (Dec. 18, 2019). Our Tribe and all energy producing Tribes are 
still waiting for that promised clarification just as we have been 
waiting since 2008.

    We anticipate, when confronted with questions about ``inherent 
Federal functions'' that Interior will say something to the effect of, 
``Submit your application; tell us what you want to undertake, and 
we'll see if we can work it out.'' If that is Interior's position, it 
shows a clear, institutional disregard for the unambiguous objectives 
of Congress. It also grossly underestimates the time, expense, and lost 
opportunities associated with participating in required pre-application 
meetings (which we undertook several years ago), preparing a detailed 
application, negotiating final terms of a TERA, only to be potentially 
confronted at the end of that process with a stop sign saying that a 
critical aspect of our proposed TERA is now a closed opportunity. With 
deep respect for the Secretary, we do not believe that is what Congress 
intended, and we hope that greater clarity on this critical point can 
be obtained.
CONCLUSION

    We hope this testimony provides background about how the concept of 
a TERA became embraced in law and how Interior's regulations were 
developed. We still believe that TERAs are a valuable option for many 
Tribes, including our Tribe. Again, we are most appreciative of the 
opportunity to present this testimony.

                                 ______
                                 
    Questions Submitted for the Record to the Hon. Melvin J. Baker, 
                  Chairman, Southern Ute Indian Tribe

The Hon. Melvin Baker did not submit responses to the Committee by the 
appropriate deadline for inclusion in the printed record.

            Questions Submitted by Representative Westerman
    Question 1. Can you further expand on your written testimony and 
explain further how the Southern Ute tribal members' standard of 
living, economically, culturally, and socially has improved over the 
last four decades as a result of the tribe taking an active role in 
developing energy resources?

    Question 2. Are there other specific barriers the Southern Ute 
Indian Tribe has experienced when seeking to develop energy projects on 
Indian lands? And beyond simply instituting a Tribal Resource Energy 
Agreement, what other solutions exist for getting rid of or lessening 
barriers to developing projects on Indian lands?

                                 ______
                                 

    Ms. Hageman. I thank the witness for his valuable 
testimony.
    The Chair now recognizes Mr. Cody Desautel for 5 minutes.

 STATEMENT OF CODY DESAUTEL, EXECUTIVE DIRECTOR, CONFEDERATED 
    TRIBES OF THE COLVILLE RESERVATION, NESPELEM, WASHINGTON

    Mr. Desautel. Thank you. Good morning, Chair Hageman, 
Ranking Member Leger Fernandez, and members of the Committee.
    My name is Cody Desautel, and I am the Executive Director 
for the Confederated Tribes of the Colville Reservation. I also 
serve as the President of the Intertribal Timber Council, but 
today I am testifying in my capacity in representing the 
Colville Tribe.
    I appreciate the opportunity to testify on the 
implementation of the Indian Tribal Energy Development and 
Self-Determination Act of 2017, which was signed into law on 
December 18, 2018. As explained in my written statement, the 
Colville Tribes developed Section 202 of the Act which 
established the Tribal Biomass Demonstration Project.
    Unfortunately, when the committees of jurisdiction in the 
Senate considered the bill in early 2017, they failed to update 
the authorization dates for the project. This error meant that 
when the Act became law, the project authority would expire in 
Fiscal Year 2021, less than 3 years from the date of the 
enactment. That unexpectedly short authorization window proved 
to be an insufficient amount of time for the Secretaries to 
implement the project authority and for any tribe to utilize 
it.
    The Tribal Biomass Demonstration Project remains an 
important tool for Indian tribes, not only for biomass energy 
utilization but also for forest management. The project is 
unique in that it directs the Secretaries to enter into at 
least four projects with Indian tribes annually for each year 
of the authorization. The prescriptive nature of the authority 
was intended to ensure that agreements that the tribes proposed 
would ultimately be entered into by the Secretaries.
    The Tribes' expertise with the Tribal Force Protection Act, 
Federal land managers are often not motivated to negotiate 
agreements with tribes, and this authority was intended to 
address that issue. Congress enacted the Tribal Force 
Protection Act in 2004 and over the first decade only six 
projects were completed. The project authority also allows 
biomass agreements to have terms of up to 30 years.
    This was intended to ensure that Indian tribes that wished 
to participate in the development of a biomass project could 
provide a reliable supply of biomass over a long period from 
adjacent Federal lands. The economics of biomass projects that 
require longer term contracts to make those projects 
economically viable. This is essential if new infrastructure is 
to be constructed in areas where it currently does not exist.
    The Colville Tribes is currently working with the Myno 
Carbon Corporation on a supply agreement to provide biomass 
from the Colville Tribes on reservation forests for a planned 
carbon removal facility in Kettle Falls, Washington. The 
planned facility is expected to remove 90,000 metric tons of 
CO2 per year in the form of biochar and avoid 
200,000 metric tons of CO2 emissions per year. The 
Biomass Demonstration Project authority would assist this 
project and similar biochar projects by ensuring an adequate 
supply of biomass.
    The project also directs the Secretaries to incorporate 
tribal on-reservation management practices on the project lands 
at the Tribe's request. As the Committee is aware, many Federal 
lands that are adjacent to tribal trust lands require fuels 
reduction and restoration activities.
    Since 2015, more than half of the 1.4 million acre Colville 
Reservation has burned as a result of massive wildfires. The 
undermanaged conditions on some Federal lands adjacent to the 
Colville Reservation contributed to the severity of at least 
one of these fire events. The Colville Tribes did not receive 
any air tanker or suppression resources until the 2015 
NorthStar fire had burned 100,000 acres because those resources 
were already committed to fires on Federal lands.
    The NorthStar Fire eventually burned for 57 days and burned 
217,000 total acres and 800 million board feet of timber, which 
in today's market would be worth approximately half-a-billion 
dollars. Although the Reservation saw more than 250,000 acres 
burn in 2015, the post-fire severity experienced on the 
Reservation was lower than that on adjacent Federal land 
because of the forest health and fuels treatments the Tribe 
carried out in previous decades.
    The project authority provides Indian tribes with a 
valuable tool not only for biomass projects but also for 
protecting on-reservation forests from wildfire and insect 
dangers from adjacent Federal forest lands. Congress should 
renew the project authority and extend its authorization to 
allow Indian Country to fully realize its potential.
    I would be happy to answer any questions the Committee may 
have. Thank you.

    [The prepared statement of Mr. Desautel follows:]
 Prepared Statement of Cody Desautel, Executive Director, Confederated 
                   Tribes of the Colville Reservation

    On behalf of the Confederated Tribes of the Colville Reservation 
(``Colville Tribes'' or the ``CCT''), I appreciate the opportunity to 
testify on the implementation of the Indian Tribal Energy Development & 
Self Determination Act of 2017 (the ``Act''), which was signed into law 
in December 2018.
    Beginning in 2011, the Colville Tribes developed what ultimately 
became Section 202 of the Act, the Tribal Biomass Demonstration Project 
(``Project''). Unfortunately, when the committees of jurisdiction in 
the Senate considered the bill in early 2017, they failed to update the 
authorization dates for the Project. This error meant that when the Act 
became law on December 18, 2018, the Project authority would expire in 
fiscal year 2021, less than three years from the date of enactment. 
That unexpectedly short authorization window proved to be an 
insufficient amount of time for the Secretaries to implement the 
Project authority and for any Indian tribe to utilize it.
    The Colville Tribes urges the Committee to update the dates in the 
Project to enable Indian tribes to utilize the authority. The 
Intertribal Timber Council, of which the Colville Tribes is an active 
member, has also recommended that the Project authorization dates be 
updated in the next Farm Bill. As explained below, the Colville Tribes 
is a participant in a planned biomass and biochar project in 
northeastern Washington that would benefit by utilizing the Project 
authority.
Background on the Colville Tribes

    The Confederated Tribes of the Colville Reservation is a 
confederation of twelve aboriginal tribes and bands from across eastern 
Washington state, northeastern Oregon, Idaho, and British Columbia. The 
present-day Colville Reservation is in north-central Washington state 
and was established by Executive Order in 1872. The Colville 
Reservation covers approximately 1.4 million acres, an area slightly 
larger than the state of Delaware. The CCT has nearly 9,300 enrolled 
members, making it one of the largest Indian tribes in the Pacific 
Northwest and the second largest in the state of Washington. About half 
of the CCT's members live on or near the Colville Reservation. Of the 
1.4 million acres that comprise the Colville Reservation, 913,000 acres 
are forested land and 652,308 of those forested acres are commercial 
timber land. Because of this, healthy forest management is critical to 
the Colville Tribes and its membership.
    In addition to the on-reservation forests, the former North Half 
\1\ of the Colville Reservation includes significant acreage of 
Colville National Forest land where the Colville Tribes possess 
reserved rights for hunting, fishing, and gathering. Approximately 40 
miles of Forest Service land in the North Half is contiguous to the 
northern Reservation boundary. The Colville Tribes and the Colville 
National Forest have carried out Tribal Forest Protection Act projects 
on Colville National Forest land and have worked cooperatively to 
prevent fire and disease on Forest Service lands. Despite the CCT's 
positive working relationship with its Forest Service neighbors, more 
tribal authority to carry out or direct activities on adjacent federal 
lands is needed. The Biomass Demonstration Project would benefit the 
Colville Tribes and other similarly situated tribes and local 
communities by allowing tribes to have an increased management role on 
federal lands that border reservation lands.
---------------------------------------------------------------------------
    \1\ In 1891, many of the various aboriginal Indian tribes and bands 
of the Colville Indian Reservation approved the Agreement of May 9, 
1891, under which the Colville Tribes ceded the North Half, which 
consists of roughly 1.5 million acres. However, the 1891 Agreement also 
reserved to the Colville Tribes and its citizens several important 
rights to the area, including the rights to hunt and fish. The ceded 
North Half is bounded on the north by the U.S.-Canadian border, on the 
east by the Columbia River, on the west by the Okanogan River, and on 
the south is separated from the south half of the Colville Indian 
Reservation by a line running parallel to the U.S.-Canadian border 
located approximately 35 miles south thereof.
---------------------------------------------------------------------------
Wildfires on the Colville Reservation

    The Colville Tribes has endured multiple major wildfire events 
during the past decade that have collectively burned more than half of 
the Colville Reservation's land base. In 2015, the North Star and 
Okanogan Complex fires collectively burned more than 255,000 acres on 
the Colville Reservation and more than 800 million board feet of 
timber, making it the most destructive wildfire event in terms of loss 
of timber on any Indian reservation in recorded history.
    In 2020, the Washington Labor Day Fires burned the most acres 
(330,000) over a 24-hour period in Washington state's history. Two of 
those fires, the Cold Springs and the Inchelium Complex fires, burned 
nearly 200,000 acres on the Colville Reservation and caused one 
fatality. Nearly 80 homes and 70 other structures also burned.

    Two separate but related factors increased the severity of some of 
these fire events on the Colville Reservation. The first was the 
undermanaged condition of some federal forest lands in the North Half 
and the surrounding areas. The other was the fact that air tankers and 
other suppression resources were tied up on other fires on those 
undermanaged areas and prohibited those suppression resources from 
being deployed to suppress fires on the Colville Tribes' on-reservation 
trust forest land. These concerns highlight why Congress should renew 
and extend the Biomass Demonstration Project authority in the Act.

The Biomass Demonstration Project

    The Biomass Demonstration Project in section 202 of the Act amended 
the Tribal Forest Protection Act of 2004 to authorize projects for 
Indian tribes on federal lands adjacent to tribal lands that are under 
the jurisdiction of the Secretary of the Interior or the Secretary of 
Agriculture. Section 202 also separately authorized biomass 
demonstration project authority for Alaska Native Corporations on 
federal lands adjacent to Alaska Native Corporation land.

    Section 202 is unique in that it directed the Secretaries to enter 
into at least four projects with Indian tribes annually for each year 
of the authorization (one annually for ANC projects). The projects 
could have terms of up to 30 years. This was intended to ensure that 
Indian tribes that wish to participate in the development of a biomass 
project could provide a reliable supply of biomass over a longer period 
from adjacent federal lands. The economics of biomass projects have 
required longer term contracts to make the projects economically 
viable, which is essential if new infrastructure is to be built in 
areas where it currently does not exist.

    Section 202 also directs the Secretaries (at tribes' request) to 
incorporate tribal on-reservation management practices on the project 
lands. As the Committee is aware, many federal lands that are adjacent 
to tribal trust lands require fuels reduction or restoration 
activities--activities that Indian tribes are uniquely suited to 
perform because of tribes' experience managing their own forests and 
natural resources. This was one of the motivating factors for the 
Colville Tribes in developing the provision.

    Allowing tribal management planning principles to be incorporated 
in these projects will also ensure that protection of cultural 
resources and sacred sites will receive the attention that they 
deserve. These cultural resources typically are not accounted for in 
federal land management plans. For example, the CCT manages certain 
areas of its on-reservation forests to promote growth of huckleberries, 
a culturally significant food for the Colville Tribes.

    The Biomass Demonstration Project remains a viable tool for energy 
projects. The Colville Tribes is currently working with the Myno Carbon 
Corporation on a supply agreement to provide biomass from the CCT's on-
reservation forests for a planned carbon removal facility in Kettle 
Falls, Washington.

    As explained in more detail on the Myno Carbon Corporation's 
website,\2\ the planned facility will intake approximately 183,000 Bone 
Dry Tons (BDT) of sustainably harvested timber waste feedstock to 
produce 40,000 BDT of biochar, which is anticipated to generate 18MW of 
renewable electricity. The planned facility is expected to remove 
90,000 metric tons of C02e per year in the form of biochar and avoid 
200,000 MT of C02e per year by mitigating slash pile burning and 
downstream emission reductions from biochar application.
---------------------------------------------------------------------------
    \2\ See https://mynocarbon.com/myno-wins-bid-to-build-first-large-
scale-carbon-removal-facility/

    For tribes that wish to construct their own biomass or biochar 
facilities, the Project authority will provide them an enhanced ability 
to obtain financing by providing a pathway for a long-term supply of 
---------------------------------------------------------------------------
biomass from federal lands.

    The Project authority provides Indian tribes with a valuable tool 
not only for biomass projects, but also for protecting on-reservation 
forests from wildfire and insect dangers from adjacent federal forest 
lands. The Project authority should be renewed and its authorization 
extended to allow Indian Country to fully realize its potential.

                                 ______
                                 

    Questions Submitted for the Record to Cody Desautel, Executive 
     Director, The Confederated Tribes of the Colville Reservation
            Questions Submitted by Representative Westerman

    Question 1. Your written testimony recommended that Congress 
reauthorize the biomass demonstration program.

    1a) How long do you think a reauthorized tribal biomass 
demonstration project should run for?

    Answer. When the Colville Tribes originally drafted the provision, 
the demonstration project had a five-year authorization. With the 
benefit of hindsight, however, and considering the lengthy processes 
for the U.S. Forest Service to consider and act on agreements and the 
potential for compliance with the National Environmental Policy Act 
(NEPA), the Colville Tribes recommends the project be authorized for at 
least seven years.

    1b) How far out should Congress put the implementation date of a 
biomass demonstration project to ensure there is enough time for tribes 
to participate?

    Answer. Section 202 of Pub. L. 115-325 requires the Secretary of 
Agriculture and the Secretary of the Interior to ensure that the 
criteria for biomass demonstration projects are publicly available by 
not later than 120 days after the date of enactment. Both Secretaries 
made guidance publicly available by the spring of 2019.
    It may be advisable, however, to provide a deadline for the 
Secretaries to determine whether a proposed project meets the criteria 
and is considered as one of the projects for a given fiscal year. I 
would be happy to discuss this with the Committee and provide 
recommendations on how to include this concept in a reauthorization.

    Question 2. In your testimony you cited the need for further tribal 
authority regarding management activities on adjacent federal lands. 
Could you expand on how a biomass or biochar project could address this 
issue?

    Answer. Facilities that utilize biomass or biochar provide a market 
for biomass, which makes removal of biomass from forests more 
economically viable. Without a facility that can pay for biomass 
material, there are few, if any, economical options to utilize the 
material. Additional tribal management authorities, such as the Biomass 
Demonstration Project, can assist in the development of biomass or 
biochar facilities by providing a reliable supply of biomass, which 
will assist in obtaining financing to build the facilities. Also, prior 
to passing of BIL and IRA forests were limited in their ability to 
enter into agreements by available funding at the forest, or 
supplemental funding from the regional office or Washington office. 
That limitation is likely to occur again once the additional BIL and 
IRA funding is spent. Having markets for traditionally non-commercial 
material should reduce the cost of restoration activities, and increase 
the number of acres that can be treated.

    2a) Would an up and running biomass or biochar project have 
prevented the devastation to the Colville Reservation suffered during 
the 2015 North Star fire?

    Answer. A biomass or biochar project would likely not have 
prevented all the devastation the North Star fire caused on the 
Colville Reservation due to the extremely dry conditions and high winds 
and the fact the Colville Tribes actively manages it forests in the 
first instance. Had a biomass project been in place on adjacent federal 
lands, however, it is likely that more suppression resources would have 
been available on the Colville Reservation before the North Star fire 
reach 100,000 acres and mitigated the fire's on-reservation impact.

    2b) And how could an up and running biomass or biochar project also 
assist with post-fire restoration?

    Answer. Many post fire restoration activities include the removal 
of dead or dying timber to reduce future fuel loading and decrease the 
risk to the staff and public. While those trees have value for roughly 
one year for local sawmills, once that timeline is over there isn't a 
market for those forest products. A biomass or biochar facility could 
make use of that material, extending the timeline for this work and 
provide a source of revenue that offsets the costs of restoration. This 
benefit is in addition the market created for traditionally non-
commercial forest products generated during forest restoration 
activities.
    Question 3. How would a biochar or biomass project be able to use 
low value hazardous fuels to benefit active forest management for the 
Colville Tribes' forests and adjacent federally managed forests?

    Answer. A biochar or biomass project would provide a market for the 
material, making removal of the biomass from the on-reservation or 
federally managed forest land more economically viable. Adding value to 
traditionally non-commercial material also allows limited funding to be 
stretched across additional acres, which should increase the pace and 
scale of current restoration efforts on both tribal and federal 
land.rese

    Question 4. Are there other specific barriers the Confederated 
Tribes of the Colville Reservation has experienced when seeking to 
develop energy projects on Indian lands? And what other solutions 
should Congress consider for getting rid of or lessening barriers to 
developing projects on Indian lands?

    Answer. For biomass related energy projects, the two main barriers 
have been (a) the reticence of federal officials to utilize all the 
discretionary authority that they possess when evaluating proposed 
projects, and (b) the timelines associated with the NEPA process and 
the potential for third party appeals for projects located on off-
reservation federal land. For on-reservation energy projects involving 
forestry resources, Congress can be helpful by delegating to tribes the 
authority to permit and approve the projects with triggering the NEPA 
process.

                                 ______
                                 

    Ms. Hageman. I thank the witness for his testimony and will 
note that I also believe that the Federal Government must do a 
better job of managing its resources in order to protect yours.
    The Chair now recognizes Mr. Nicholas Lovesee for 5 
minutes.

   STATEMENT OF NICHOLAS LOVESEE, DIRECTOR OF POLICY, NATIVE 
     AMERICAN FINANCE OFFICERS ASSOCIATION, WASHINGTON, DC

    Mr. Lovesee. Thank you so much, Madam Chairwoman, Ranking 
Member Leger Fernandez, and members of the Indian and Insular 
Affairs Subcommittee.
    My name is Nicholas Lovesee. I am Director of Policy for 
the Native American Finance Officers Association (NAFOA) and 
would like to thank you for the time to speak with you today 
about tribal autonomy and energy development.
    Over the past 2 years, NAFOA has made tribal energy 
development and policy a focus of our organization and a goal 
of ours to help increase tribes' ability to participate in the 
new energy economy and help unlock the massive energy potential 
of Indian Country.
    There are two points I really want to stress before 
continuing. First, there should be a focus on leveling the 
playing field in ensuring that tribes have a fair opportunity 
to compete. Fair. Second, NAFOA is energy source agnostic. A 
crucial part of tribal self-determination is being allowed to 
make the decisions based upon the unique needs and situations 
of any individual tribe.
    First, I would like to talk about the Loan Program Office 
(LPO). Last summer, as part of the Inflation Reduction Act, 
they made an important change of allowing the Loan Program 
Office to offer loans directly. Previously, they had to go 
through a third party. This is an important change and 
hopefully will help decrease some of the friction in the 
process of offering loans.
    Additionally, they changed from $2 billion to $20 billion 
the amount of loans for the LPO to be able to offer. These 
changes are a major step forward. Unfortunately, we have yet to 
see LPO grant any loans and there are unnecessary stumbling 
blocks in the way.
    Also, in the IRA were provisions limiting the use of 
appropriated funds by making the loans subject to Federal 
support restrictions. DOE has heard from Congress and tribes 
that this restriction creates uncertainty when trying to get 
loans to projects through the LPO program.
    Also, part of the IRA, Congress made an exciting, well, I 
guess I am kind of stretching the definition of exciting, 
change to the tribal energy development by allowing tribes to 
access the Federal direct pay clean energy tax credits. Adding 
up these bonuses, these credits potentially enable a tribe to 
cover 70 percent of a project's cost.
    NAFOA has been working with the Department of Treasury to 
ensure that information about these changes in tax credits are 
available to all tribes that are interested in taking advantage 
of them. However, it has been slow to get guidance out and this 
has caused a number of programs to enter essentially a holding 
pattern while they wait to find out what is going to be 
available with direct pay credits.
    For almost a year now, tribes have had to wait for Treasury 
to release guidance. And even though they have started the 
process, they haven't completed it, and there are still 
important questions remaining outstanding.
    Another important area that is blocking tribal energy 
development is the lack of decision making on tribally 
chartered corporations. NAFOA participated with TETRAA and NCAI 
as part of a Department of Treasury ``Dear Tribal Leader'' 
letter sent around in May of this year. Per the Department of 
Treasury's letter, presently there is no guidance addressing 
the Federal tax status of corporations chartered under tribal 
law that may be wholly owned, majority owned, or jointly owned 
by tribes.
    In response to substantial tribal leader requests for 
guidance on this question for over 30 years, Treasury's Office 
of Tax Policy is seeking tribal leader feedback. Why is this 
important to tribal energy development? As anyone who has 
worked in the energy industry knows, that how you structure 
these partnerships can be just as important as what the project 
is itself, whether it is being able to defer risk, whether it 
is about who owns the project, being able to seek financing. 
These are important questions that remain uncertain, and these 
are all part of the problems that play into tribal energy 
development issues.
    Another area that doesn't get enough talk, in my opinion, 
is staffing. There is a severe lack of staff that understand 
both tribal energy and also just energy in general, they don't 
have enough staff to work with experience in tribes and also in 
energy.
    A good example of this would be COVID where a number of the 
departments had to quickly staff up to deal with the millions 
and millions of dollars that Congress was nice enough to 
appropriate. But they didn't have enough people who understood 
tribal issues, and we spent a lot of the last 2 years working 
with the staff to try to help them understand, because many of 
these offices had never dealt with tribal issues before.
    I want to thank everyone for their time today and we look 
forward to working with Congress and the Committee on any 
potential future legislation. Thank you.

    [The prepared statement of Mr. Lovesee follows:]
  Prepared Statement of Nicholas Lovesee, Director of Policy, Native 
             American Finance Officers Association (NAFOA)

    Good morning, Chairwoman Hageman, Ranking Member Leger Fernandez, 
Committee Chairman Westerman, Ranking Member Grijalva, and Members of 
the Indian & Insular Affairs Subcommittee and Natural Resources 
Committee. My name is Nicholas Lovesee, I am Director of Policy for the 
Native American Finance Officers Association (NAFOA) and I would like 
to thank all of you for your time today and for the opportunity to 
speak with you about Tribal Autonomy and Energy Development. Over the 
past two plus years NAFOA has made tribal energy development and policy 
a focus of our organization and a goal of ours to help increase tribes' 
ability to participate in the new energy economy and help unlock the 
massive energy potential of Indian Country, which for too long has gone 
untapped.
    There is one point I want to stress before continuing, there should 
be focus on leveling the playing field for tribes to have a fair 
opportunity to compete. At NAFOA, we hear repeatedly from both member 
and non-member tribes, ``we don't want anything more than anyone else, 
we want to ensure that we have a fair shot''. As we've seen over and 
over, when tribes are able to compete on a fair playing field, they 
succeed.
    Lastly, as an organization, NAFOA is energy source agnostic. A 
crucial part of tribal self-determination is being allowed to make 
decisions based upon the unique needs and situation of any given tribe, 
and it should be up to tribes and tribal members to decide what the 
best solutions are for their unique needs and situations. Just like for 
states, there is no ``one size fits all'' solution for tribes.
Loan Program Office (LPO)

    Last summer, NAFAO testified before the House Energy & Commerce 
Committee on the Department of Energy's Loan Program Office (LPO) 
program. At the time, LPO had just been granted the ability to give 
direct loans to tribes, rather than guarantee loans that a tribe would 
receive. However, it was a temporary situation and there was 
uncertainty as to whether LPO would be able to continue to maintain 
that option. Fortunately, the Inflation Reduction Act (IRA) made the 
change permanent and increased the total amount of loans that could be 
offered, going from $2 billion to $20 billion. These changes were major 
steps forward for the LPO program and could have a huge potential 
impact on tribal energy development opportunities.
    Unfortunately, we have yet to see LPO grant any loans and there are 
unnecessary stumbling blocks still in the way. For example, the 
Inflation Reduction Act (IRA) included a provision limiting the use of 
appropriated funds by making the subject to a federal support 
restriction. DOE has heard from Congress and tribes that this 
restriction creates uncertainty when trying to get loans to projects 
through the LPO program.
Elect/Direct Pay

    As part of last summer's IRA, Congress made an exciting change to 
tribal energy development by allowing, for the first time, tribes to 
access the federal Direct Pay, clean energy tax credits. Adding up all 
the bonuses, these credits potentially enable a tribe to cover 70% of a 
project's cost. NAFOA has been working with the Department of the 
Treasury to ensure that information about these changes and tax credit 
opportunities is available to all tribes that are interested in taking 
advantage of them.
    However, as exciting as Direct Pay possibilities are, there have 
been some major roadblocks put in the way of accessing them. First, 
following passage of the IRA there has been almost a hold placed on 
many tribal energy projects as developers and tribes have adopted a 
``wait and see'' approach to Direct Pay changes. Without guidance from 
Treasury and the IRS, no one is really sure what to make of these 
Direct Pay provisions for tribes, how they would be implemented, and 
what they actually mean in practical terms. For almost a year now we've 
seen this holding pattern and while Treasury has released some 
guidance, there are still key questions outstanding and many of the 
tribes and developers that I've spoken with are hesitant about what the 
landscape will look like going forward. Even the financing side of a 
project is impacted and slowed while we wait for Direct Pay guidance 
and rules, as tribes have an option to receive lending based on Direct 
Pay credits.

    Another major issue the lack of technical assistance that IRS and 
Treasury can offer tribes. To this point, tribes do no file federal 
income tax. So how would they access a federal income tax credit 
payment? Our understanding from IRS statements is that they do not have 
the legal authority to provide this assistance. There needs to be an 
authorization that will allow IRS to give in-depth information and 
technical assistance to tribes, similar to the types of technical 
assistance available with many other tribal programs, as well as a 
place where tribes can go to ask for guidance or clarification.

Tribally Chartered Corporations

    On the 18th of last month, NAFOA submitted consultation comments in 
partnership with the Tribal Economic Tax Reform Advocacy Alliance 
(TETRAA) and the National Congress of American Indians (NCAI) as part 
of a Department of Treasury and IRS ``Dear Tribal Leader'' letter sent 
around on May 15th of this year. The purpose of the letter and 
consultation was to seek guidance on the tax status of tribally 
chartered corporations, including those that are just jointly owned by 
a tribe. This is a problem that tribal leaders have asked to be 
addressed for decades. Per the Department of the Treasury's letter:

        Presently, however, no guidance addresses the Federal tax 
        status of corporations chartered under Tribal law that may be 
        wholly owned, majority owned, or jointly owned by a Tribe. In 
        response to substantial Tribal leader requests for guidance on 
        this question for over thirty years, Treasury's Office of Tax 
        Policy is seeking Tribal leader feedback to inform its 
        understanding of Tribally chartered corporations.

    Why is this relevant for today's hearing and tribal energy 
development? As anyone who's worked in the energy industry or around 
energy projects knows, the ownership structures and entities of energy 
projects can make a massive impact on the profitability and/or 
viability of a given project. How tax credits are assigned, liability 
protections, ownership and investment stakes, and more all play key 
roles in the life cycle of energy projects and the current situation 
creates uncertainty and liabilities.

    Unfortunately, tribes have been dealt an unfair hand. Going back to 
the Direct Pay, currently IRS is not able to offer the required 
technical assistance on tax filings that many tribes need or will need. 
This will require a change in authorization, just to bring the 
assistance to parity with the types of technical assistance already 
available to other programs.

Tribal Energy Development Issues

    Another issue that doesn't get nearly enough attention is the 
shortage of experts and staffing when it comes to tribal energy 
development. There are plenty of experts in the energy industry and 
sector, but very few have any kind of experience working with tribes or 
tribal governments, and often don't even know the first place to start 
or where to take their issues. On the flip side, there are plenty of 
tribal experts who can tell you inside-and-out how tribal governments 
work, the unique issues tribes and tribal members face, and how to best 
address issues that tribes are used to facing. However, there is a 
shortage of those types of tribal staff and experts that have 
experience working in the energy sector.

    We recently lived through a good example of this with COVID-19. To 
deal with the sudden influx of COVID funding, various Departments 
throughout the Administration had to ``staff-up'' and were finding 
themselves responsible for millions of dollars in aid to Indian 
Country, many of which had never dealt with tribes or tribal issues 
before. There was a shortage of experienced people from which these 
Departments were able to hire and at NAFOA we spend a significant 
amount of time these past three years having to educate staff on how to 
reach tribes and tribal members, what they needed to know about working 
in Indian Country, how to solve the issues they were facing, and more.

    I want to stress than in almost all cases these were extremely 
competent, smart, hardworking, and dedicated staff, but from the 
outside looking in, it appeared as though they were thrown into the 
deep end of a pool and told ``now swim!''
    Another unique situation that has created unique barriers for 
tribes is the land into trust system, and these are barriers that non-
tribal energy developers don't face. When testifying before the Senate 
Committee on Indian Affairs this past March, NAFOA stated:

        I have repeatedly heard that delays in approvals by the Bureau 
        of Indian Affairs of rights-of-ways, permits, and leases 
        increases costs of tribal projects, delays projects 
        unnecessarily, and sometimes, directs projects onto neighboring 
        non-tribal fee lands. Beyond energy, these delays impact 
        broadband and other infrastructure projects. Congress can 
        improve the efficiency of these processes by putting authority 
        back into the hands of tribal governments where they wish to 
        exercise it. Archaic and stifling rules regarding tribal land 
        use can tie-up the process in red tape and discourage 
        investments. In some cases, BIA requests could take up to two 
        years, which can be the end to of any economic, development 
        project. According to the GAO, the permitting review process 
        under the BIA can take two times as long as the Bureau of Land 
        Management.

    Two years for a permitting review is a lifetime for many energy 
projects and developers and financers sometimes decide ``why put up 
with this when I can do a different energy project that won't face 
these issues?''

    One of the solutions that NAFOA has recently been working on is 
legislation that would give tribes more control over permitting and 
regulations on their own land. States are allowed to set regulations, 
why can't tribes? If tribes want to create a situation that is 
attractive to developers or capital, they should have that option. 
Being able to create an environment where energy projects are 
economically attractive to businesses is going to be a huge step 
forward in making tribal energy projects a reality.

    This would also help ease the business ``friction'' that exists for 
tribal energy projects and development. Sadly, some companies and 
developers look at working with tribes as ``adding headaches'' or 
hurdles and not as an advantageous partner. This creates issues not 
just in financing, but in trying to bring on additional partners so 
that tribes don't have to do a project alone and accept the full burden 
of a project's risk, a huge ask for almost any tribe but especially 
smaller ones.

    Lastly, there is a disconnect between Washington, D.C. and the 
realities tribal governments face. In April, NAFOA hosted its Spring 
Conference here in D.C. and we were very fortunate to have a strong 
turn-out of Administration and government staff. However, while they 
discussed a wide range of programs and monies available, there was a 
sentiment of ``that's nice, but how are we supposed to access it.'' 
There needs to be more done to make these programs practically 
accessible. During COVID the amount of information flooding the field 
was nearly impossible for tribes to keep up with, from application 
deadlines to changes in guidance to new opportunities.

Conclusions

    Again, tribal energy is not about more or special, it is about 
creating a level and fair playing field and certainty. The good news is 
that there is a lot of excitement for tribal energy development. 
Webinars and information sessions that NAFOA hosts are widely attended, 
and we often receive information requests about different energy 
programs, grants, credits, and possibilities from both members and non-
members. Tribal energy development is a massive opportunity, not just 
for Indian Country but the United States as a whole, it is estimated 
that the 53 million acres of Indian lands are host to 20% of Americas 
conventional energy resources, as well as holding the potential for 
vast renewable energy resources.

    NAFOA is eager to work with the Subcommittee and Members to help 
ease the energy transition and allow all tribes an opportunity to 
participate in the new energy economy we are building.

                                 ______
                                 
  Questions Submitted for the Record to Nicholas Lovesee, Director of 
          Policy, Native American Finance Officers Association

            Questions Submitted by Representative Westerman

    Question 1. Your testimony mentioned that having a level playing 
field and allowing tribes to purse whatever energy projects will best 
benefit their individual tribal communities and people. In your 
experience, which energy sources or other energy resources are tribes 
seeking to develop the most, and what are reasons for the preference 
that tribes have provided to you?

    Answer. Fortunately, there is an interest in Indian Country for a 
diverse array of energy project, both renewable and traditional. On the 
renewable front, it would appear that more tribes are interested in 
solar than anything else, this is partly due to geography and that 
there are more contractors and experts available in the solar field at 
the moment. For traditional energy there is a stronger interest in oil 
and gas production.

    Again, I would add much of the interest is shaped by a tribe's 
geography, local resources, individual needs, size (this includes 
factors such as land area, economy, and membership numbers), and 
location (more urban vs more rural). Each tribe faces a unique set of 
circumstances, and what is attractive or economical to tribes in one 
area might be a poor investment for a similar tribe in a different part 
of the country.

    1a) Do you think tribes would be interested in more expansive 
sources if some projects were easier to develop or had less federal 
bureaucracy to wade through?

    Answer. From what I have heard from tribes and contractors, there 
would be an increased interest in energy projects of all types if there 
was less federal bureaucracy, especially if questions related to 
federal projects, tax credits, regulations, and more were answered in a 
timely manner that considers both the needs of tribes and the intent of 
Congress. Unfortunately, in the current environment we don't know how 
interested various tribes will be in many different areas of energy 
development because one look at the difficulty managing all the federal 
rules, regulations, and programs kills projects before they even get 
off the ground.

    Another factor that would increase tribal interest in energy 
projects is increased tribal control over rules and regulations for 
projects on tribal lands. Allowing tribes to set their own regulatory 
standards will enable them to decide what is right for their unique 
situation and be more in line with the government-to-government 
relationship that the United States has with tribes. Additionally, it 
would help with the gridlock for permitting and approvals, which take 
almost twice as long at the Bureau of Indian Affairs (BIA) than at the 
Bureau of Land Management (BLM).

    In general, on tribal issues there is not enough federal assistance 
to tribes to help navigate these complex rules and regulations, and 
this is especially true when it comes to tribal energy projects. The 
complexity makes it nearly impossible for tribes to find a safe place 
to start and again highlights the need for more experts that understand 
both Indian Country's unique challenges and the energy industry.

    Again, thank you for your interest and work on this important 
topic. I look forward to continuing to work with you and your staff on 
this topic, as well as any other topic that NAFOA might be helpful 
with. If there is any additional information or help that we can 
provide, please do not hesitate to contact us.

            Sincerely,

                                              Susan Masten,
                                         Interim Executive Director

                                 ______
                                 

    Ms. Hageman. I thank the witness for his testimony.
    The Chair now recognizes Ms. Bidtah Becker for 5 minutes.

STATEMENT OF BIDTAH BECKER, CHIEF LEGAL COUNSEL, OFFICE OF THE 
   PRESIDENT AND VICE PRESIDENT, NAVAJO NATION, WINDOW ROCK, 
                            ARIZONA

    Ms. Becker. [Speaking Native language.] Good morning, Chair 
Hageman, and Ranking Member Leger Fernandez. I think she is the 
only one who understood me just now, so appreciate that.
    As the Chair mentioned, my name is Bidtah Becker, and I am 
Legal Counsel to President Nygren and Vice President Richelle 
Montoya of the Navajo Nation. President Nygren sends his 
regards. He is very busy. Started the week in Alaska at a 
tribal transportation meeting and I am not even sure where he 
is today, that is how busy he is.
    Energy has been super critical to the Navajo Nation's 
economy for 100 years now. I am going to share one story, just 
one of many. The United States was very critical in standing up 
something called the Navajo Generating Station that supplied 
power to Los Angeles, Phoenix, Las Vegas. Not a single electron 
was used on the Navajo Nation.
    The United States was critical in both the plant site lease 
that was on the Nation, and on ensuring that coal leases were 
developed between the Hopi Tribe, the Navajo Nation, and the 
Peabody Coal Mine. The Navajo Nation and the Hopi Tribe 
expected that plant to stay open until 2044. It shut down in 
2019. And I share that story because it is critical to our 
conversation, really everything that has been talked about 
today.
    We lost a thousand direct jobs, lots of coal royalty, 
around $40 million a year we lost. But the lesson we learned 
from that is, we cannot be at the mercy of outside entities 
when it comes to the jobs and revenue on the Navajo Nation. One 
of President Nygren's key priorities is ensuring that as we 
continue down this energy development portfolio that the Navajo 
Nation has some ownership role in that so that we have a say 
instead of watching these jobs disappear.
    The Act does allow for all Tribal Nations to take over 
mineral leasing. And we have been asked repeatedly why haven't 
we done that. One of the challenges of why we aren't currently 
pursuing taking over mineral leasing is there are databases of 
valuable information that the Department of the Interior holds. 
And we have been informed that if and when we take over mineral 
leasing, we will lose access to that information.
    That is really akin to what Mr. Lovesee is talking about, 
about the types of expertise that are needed for energy 
development. And I could not underscore enough what he 
mentioned about business structure, because one of the things 
we learned when the Navajo Generating Station closed was, we 
should not have been surprised it was closing. There were 
people that were anticipating this, but at the time we didn't 
have the expertise to foresee that.
    Another challenge is, I am going to call it limited 
technical assistance that the Department of Energy provides. 
And I recognize that at this point I am stepping into areas 
that are uncomfortable because the committees have jurisdiction 
over certain agencies. We would really benefit from the 
extensive and very technical expertise from the Department of 
the Interior.
    Ms. Hageman. I am sorry, I didn't hear that. Could you 
bring your microphone just a bit closer? Benefit from what?
    Ms. Becker. We would benefit from the extensive technical 
expertise that the Department of Energy could provide that we 
wouldn't necessarily find in the Department of the Interior. 
Everything that Mr. Lovesee said underscore, highlight. Energy 
is a big field, right? You have transmission, you have business 
structure, you have taxes. Those skills are not necessarily all 
found in the Department of the Interior.
    Again, I recognize that I am stepping into areas that 
perhaps could be uncomfortable because of types of 
jurisdiction, but there are more agencies that do energy 
development, right, than just Interior and Energy. USDA plays 
an important role in that.
    I guess what I will end with is a great quote, and 
Representative Leger Fernandez may remember the great dean, 
Fred Hart, of the UNM School of Law. When I was a youngster 
without all this gray hair, he said, ``The problem with Federal 
Indian law is that it is national in nature.'' It is national 
in nature. Boy, this was an Irish guy from Boston who is 
teaching a Navajo girl, and he was spot on.
    Thank you for your time. I really appreciate it and stand 
for questions.

    [The prepared statement of Ms. Becker follows:]
 Prepared Statement of Bidtah N. Becker, Legal Counsel, Navajo Nation 
               Office of the President and Vice-President

    Ya,at,eeh Chair Hageman, Vice Chair Gonzalez-Colon, and Members of 
the Committee, my name is Bidtah Becker and I serve as the Chief Legal 
Counsel to Navajo Nation President Buu Nygren and Vice-President 
Richelle Montoya. I have had extensive experience with the Navajo 
Nation's natural resources and energy development activities during my 
twenty-one (21) years with the Navajo Nation. Over the years I have 
served in both legal and non-legal roles including directing the Navajo 
Nation Division of Natural Resources.
    Energy has been critical to the Navajo Nation economy for decades. 
As we celebrate the Navajo Nation Council's centennial year, we are 
reminded that the Navajo Nation Council was first created at the 
request of the United States to approve oil and gas leases. In more 
recent times, the Navajo Nation was home to the Navajo Generating 
Station which was the largest coal fired power plant west of the 
Mississippi. It was commissioned in 1974 and the United States played a 
critical role in standing up the Navajo Generating Station and 
developing coal leases between the Navajo Nation and the Hopi Tribe 
with the Peabody Coal Company. The coal mine's sole customer was the 
Navajo Generating Station. Stewart Udall, Secretary of the Interior, 
penned a letter at the time praising the economic benefits and 
opportunities that the Generating Station and the coal mine would 
provide.
    In 2017, to the Navajo Nation's surprise the owners of the Navajo 
Generating Station announced it would shutter the facility in 2017 
rather than operating until 2044 as expected. The owners needed 
sufficient comfort through new agreements to keep the Generating 
Station open for two additional years to 2019. I served as the lead 
negotiator for the Navajo Generating Station Extension Lease that kept 
the Generating Station open to 2019.
    In 2019, the Generating Station was closed along with the coal 
mine. These closures led to the loss of 1,000 direct jobs and 3,000 
indirect jobs. In addition, in 2019 the school district where the coal 
mine was located lost 300 students or nearly 10% of the district's 
enrollment. The Navajo Nation and the Hopi Tribe both lost significant 
revenue with the loss of the coal royalties.
    I share this story because it is relevant to the Indian Tribal 
Energy Development & Self-Determination Act. One of the key lessons for 
the Navajo Nation is to not recreate the situation where the Nation is 
at the mercy of others for energy development on the Nation when the 
livelihoods of Navajo people are at stake. One of President Nygren's 
priorities is that the Navajo Nation have an ownership role in energy 
development so that when hard decisions need to be made concerning the 
livelihood of Navajo people, the Navajo Nation has a voice in the 
decision.
    The Act allows the Navajo Nation and other Native Nations to 
develop regulations so that the Native Nations can issue mineral 
leases, including oil and gas leases. The Act also allows for the 
Department of the Interior (Department or DOI) to provide technical 
support in the development of those leasing regulations. The Act, 
however, does not address the services that DOI provides to the Navajo 
Nation when we are making leasing decisions. Specifically, the 
Department, including the Bureau of Indian Affairs (BIA), Bureau of 
Land Management (BLM), and Office of Natural Resource Revenue (ONRR), 
have lease, production and royalty databases that include well and 
lease information, production formations, production volumes, sales 
volumes, commodities pricing, major portion price analyses, index zone 
pricing, royalties, economic data, contract data, regional pricing 
forecasts--and so much more--that the Navajo Nation will not have 
access to if it should decide to take over its own mineral leasing 
process. Without access to these data sets, the Navajo Nation's 
effectiveness at negotiating and overseeing mineral leases, including 
compliance, will be greatly, and negatively, affected. The Navajo 
Nation has confirmation from the Office of the Solicitor staff who 
advise ONRR that that Nation will lose access to these data sets if we 
issue our own mineral leases.
    As mentioned, the current Navajo Nation Administration is 
interested in more than the issuance of mineral leases related to 
energy development. There are certainly mineral leases that do not 
involve energy development but when it comes to energy related mineral 
leases, the Nation has learned the difficult way what ensues when the 
Nation does not have a management voice.
    Another challenge with the Indian Tribal Energy Development & Self 
Determination Act is that it is focused only on the Department of the 
Interior. The Navajo Nation could benefit greatly from expertise and 
more expansive technical assistance within the Department of Energy. 
The Navajo Nation signed a Memorandum of Understanding with the 
Department of Energy last December to assist with navigating the many 
federal funding opportunities available for energy transition. The 
Navajo Nation is located in a geographically key area for energy 
development in the Southwestern United States and is blessed with vast 
and a variety of natural resources. One of the areas where the Nation 
could benefit from DOE technical assistance is understanding the energy 
market and getting out in front of new and developing technologies, 
especially related to a carbon neutral future.
    One of the things the Subcommittee could consider is granting 
several federal departments and agencies the discretion to work with 
Native Nations. Importantly, these federal entities could be empowered 
to meet the unique and specific needs of the Nations. It goes without 
saying that the needs of the Navajo Nation for energy development are 
very different than the needs of a Native Nation located in the 
Northwestern United States. I understand how challenging it can be to 
grant discretion to federal entities. At the same time, I am reminded 
on a regular and reoccurring basis of the words of the late Dean Fred 
Hart of the University of New Mexico School of Law: the problem with 
federal Indian law is that it is national in nature.
    Thank you for your time. I look forward to further Subcommittee 
discussions that can address energy development issues facing the 
Navajo Nation and Native Nations in general. As this Subcommittee 
appreciates, I know of no other community more interested and committed 
to protecting the lands of the United States and ensuring self-
sufficiency than Native Peoples. We have been here from time immemorial 
and the majority of us plan for our communities to be living and 
thriving on this land forever. Ahehee, (Thank you).

                                 ______
                                 

   Questions Submitted for the Record to Bidtah Becker, Chief Legal 
   Counsel, Office of the President and Vice-President, Navajo Nation
            Questions Submitted by Representative Westerman

    Question 1. Your testimony mentioned that one of President Nygren's 
priorities is for the Navajo Nation to have an ownership role in energy 
development. How has Navajo Transitional Energy Company (NTEC) been a 
part of this move towards ownership in energy development, and what 
have been the benefits to Navajo Nation of establishing the NTEC?

    Answer. The Navajo Nation took ownership created NTEC in response 
to the prior owner of the Navajo Mine announcing it was going to close 
the mine. By establishing NTEC, the Navajo Nation took ownership of the 
sole mine that provides coal to the Four Corners Generating Station. 
The Navajo Nation preserved the coal royalties and on Navajo Nation 
jobs associated with the mine and power plant, which totals about 800 
jobs. Since the purchase of the mine several years ago, NTEC has 
ventured into new areas and is currently engaged in several discussions 
concerning both off Navajo Nation and on Navajo Nation energy projects.

    1a) Can you expand on what that ownership role for Navajo Nation 
practically looks like in the future?

    Answer. The ownership role allows the Navajo Nation to have a say 
in when and how to close important employers on the Nation. It also 
allows the Navajo Nation to know as soon as possible when employers are 
possible shutting down. The shutdown of the Navajo Generating Station 
(NGS) resulted in the loss of 1,000 direct jobs on Navajo Nation jobs 
and 3,000 indirect jobs. If the Nation had been an owner of NGS, it 
would have known sooner what the owners' plans were and could have 
begun working on worker placement programs so that these individuals 
could continue to be employed on the Navajo Nation.

    1b) What would be the ideal managing situation look like for Navajo 
Nation?

    Answer. The ideal managing situation will be unique to each energy 
project. That being recognized, the ideal managing situation allows the 
Navajo Nation to have a say in not only how to protect Navajo Nation 
jobs but also to ensure the Navajo communities are heard and their 
concerns are adequately responded to. It also helps ensure the 
development of an on Navajo Nation economy.

    Question 2. Your testimony mentioned that access to several 
agencies' databases would be crucial to fully carry out the expanded 
leasing authorities included in the Indian Tribal Energy Development 
and Self Determination Act Amendments of 2017.

    2a) Could you provide further information to the committee 
regarding what the Department of the Interior Solicitor staff provided 
as the reason(s) the Navajo Nation would lose access to the data if the 
Nation decided to issue its own mineral leases?

    Answer. The Navajo Nation staff spoke with the Office of Natural 
Resources Revenue who reported the decision from the Office of the 
Solicitor. The reasons for the Solicitor's decision were not shared 
with the Navajo Nation staff.

    2b) While a lack of access to the lease, production, and royalty 
databases is mentioned prominently in your testimony, could you expand 
on any other issues that would impact the Navajo Nation's use of these 
expanded leasing authorities?

    Answer. The Navajo Nation Minerals Department currently 
collaborates with the Bureau of Land Management (BLM), Office of 
Natural Resources Revenue (ONRR), and Bureau of Indian Affairs (BIA) in 
managing mineral leases. For the most part, these are complicated 
leases to manage and ONNR provides very valuable assistance. For 
instance, regulations concerning the appropriate valuation of royalty 
price change over time as the energy market develops. This type of 
real-world energy market engagement requires a specialized staff that 
is employed through ONNR. When considering taking over mineral leasing 
authority, the Minerals Department is and has struggled with developing 
the appropriate staffing and finding the funds to ensure this 
appropriate staffing for valuation alone. Even when considering 
contracting valuation services, the Navajo Nation Minerals Department 
has been unable to find the resources necessary to meet the standard of 
service it currently expects.
    This is why access to the databases referenced above is so 
important. ONNR has a royalty collection database that ensures a 
monthly reporting for each producer on the Nation. This includes but is 
not limited to what is produced, sales volume, sales values, royalty 
values, including deductions, and more. The Navajo Nation has yet to 
determine how it can replace this ONNR database in the event it takes 
over all mineral leasing.
    BLM also has a database that provides production reports. The BLM 
system works together to compare ONNR data with BLM data. BLM reports 
well level data and ONNR report lease level data. These two reports are 
then compared and shared with Mineral hyper accurate reporting. Again, 
in imagining how to take over mineral leasing, the Minerals Department 
struggles to determine how to replace this hyper accurate data.
    The Minerals Department is committed to tribal sovereignty and is 
currently considering taking a small slice of mineral leasing authority 
over, and specifically sand and gravel leasing. This is because the 
database services are not as critical to sand and gravel reporting and 
lease management as they are for oil and gas. Reporting is required 
from sand and gravel companies but because it is above ground, it is 
easier to monitor the production.
    It is important to note that the Minerals Department is committed 
to tribal sovereignty and last year the Navajo Nation Council passed 
the necessary laws for the Minerals Department to eventually obtain 
primacy over surface mining reclamation from the Office of Surface 
Mining. The Navajo Nation is poised to become the first tribal nation 
to take over primacy of surface mining regulation in the United States. 
This is important to note because Minerals has been able to figure out 
staffing needs for other of its programs so as to take over roles of 
the federal government. Mineral leasing has been more elusive.

    Question 3. President Nygren testified earlier this Congress 
against the mineral withdrawal around Chaco Canyon because it would be 
detrimental to Navajo allottees that have allotted land within the 
withdrawal area and rely on revenues from oil and gas production to 
make ends meet. Looking at that decision from a different perspective: 
Does this withdrawal affect the overall energy resource development for 
Navajo Nation?

    Answer. The Navajo Nation is currently reviewing how the withdrawal 
affects the overall energy resources development for the Nation.

    3a) In addition, please expand on how this withdrawal affects other 
energy projects on Navajo lands.

    Answer. The Navajo Nation is currently reviewing how the withdrawal 
affects other energy projects on Navajo lands.

    Question 4. Are there other specific barriers the Navajo Nation has 
experienced when seeking to develop energy projects on Indian lands? 
And what other solutions should Congress consider for getting rid of or 
lessening barriers to developing projects on Indian lands?

    Answer. Specific barriers can include certain regulatory reviews 
and timing. Meaning if regulatory reviews are too slow, the Nation may 
not capture the market opportunity.
    Something Congress could consider is granting discretion to 
agencies when they are working specifically on Indian land. The purpose 
of discretion would be able to, among other things, consider the 
various benefits occurring on Indian Land that might be lost if 
regulatory reviews are unnecessarily delayed. As things stand, all 
projects are treated as essentially equal for many regulators. To 
respond to the market, some projects need to be evaluated more quickly 
than others, and without losing the quality of the review.

                                 ______
                                 

    Ms. Hageman. I have to go to a different committee, and 
then I will come back and ask my questions. Thank you very 
much.
    Mr. LaMalfa [presiding]. Thank you again. It is kind of 
nice to be back in the old Chair seat for the Indian Affairs 
from years ago.
    I want to thank our witnesses again for your testimony and, 
of course, for your time and travel.
    Let's move into Member questions. I will bypass myself for 
now. Let's go to our Ranking Member for her 5 minutes.
    Ms. Leger Fernandez. Thank you so very much for both the 
written testimony that we had all read but also for emphasizing 
I think some of the very key areas.
    Perhaps, I am going to start about the issues that have 
been raised by NAFOA, which is a national organization, but I 
do know that you work on trying to keep all of the different 
tribal interests in play. And I wanted to actually touch a bit 
on some of the issues that you raised that I think we need to 
go back and look at getting the guidance out, and are there 
things that we need to do at a congressional level, and it 
might not be in this Committee.
    The great thing about this Committee, Ms. Becker, is we 
have oversight. We cannot legislate, but we sure can raise 
issues with the other Federal agencies, including the need for 
a tribal task force with all of the different agencies, 
bringing the kind of expertise they have in their unique areas. 
And this Administration has done that a lot. They keep calling 
it the whole of government approach. I don't know if I am crazy 
about the tag line they use, but the idea of pooling what is 
necessary from each of those areas to get these projects going.
    I think that there is a concern I have about, there are two 
levels of expertise that we need. We need the expertise at the 
Federal level, the agency level, in order to address how do you 
actually go about issuing a lease since we have so many 
different--you know, is it an IMDA (Indian Mineral Development 
Act), is it an old lease, new lease, et cetera. But also, we 
need to make sure that there is expertise available to the 
tribe for them, and that could be a funding issues that we need 
to do.
    So, Mr. Lovesee, can you tell us a little bit more? Because 
I want to get this money out, right. We need to get this money 
out. We need to get you using it. I think you said it in your 
written testimony, but could you tell us the two things that 
you want us to do, and it might not be this Committee, so we 
can get the tribes the money they need to do these projects 
that America needs.
    Mr. Lovesee. First of all, I would like to thank you, 
ma'am, because last year you were very instrumental in NAFOA 
being in front of the House Energy Committee and testifying on 
LPO.
    The two things that I would recommend is first, we need to 
sit down and figure out what can we do to create a positive 
business atmosphere for tribes so that companies or any outside 
group isn't looking at the negatives of working with the tribal 
government, but they are looking at the positives. And I would 
imagine it is very frustrating for all the Members sometimes to 
do something like direct pay or like LPO changes and still not 
have enough projects going forward, and people like myself 
saying, well, what can we do next instead of thanking you for 
what you did. But it needs to be kind of a whole effort looking 
at it rather than just a little bit here, a little bit there. 
What can we do to really create a positive situation overall?
    And then secondly, I would say again, and it is not a very 
exciting thing, but staffing is so important because we need to 
get people in the tribes who represent the tribe's interest 
instead of having just a consultant come in and say this is 
what needs to be built. We need people who are in the tribes 
that understand energy from front to back.
    Ms. Leger Fernandez. Yes. And because we have little time, 
I am going to say in some ways I am going to--and you know the 
way CERT (Council of Energy Resource Tribes) played a 
particular role like that because they might not have always 
needed to be in the tribe because the tribe might not always 
have, except for some tribes, a continuous development, but 
then that ability of a trusted agency back in those days of a 
certain namesake.
    We are talking a bit about when people go to Southern Ute, 
they know they are dealing with a tribe incredibly versed in 
the business world and incredibly successful.
    But, Chairman, I was also struck by in your testimony how 
important it was for you to make sure you controlled the 
protection of the environment and the cultural resources. Can 
you give us a quick example of that? And then I did want to get 
to this question on staffing, what would a shutdown look like? 
So, if you could perhaps be quick, and then I am going to do a 
maybe yes or no round.
    Mr. Baker. Yes, thank you, Ms. Fernandez. I think, it 
really starts with our past leaders, their visions, how they 
moved forward and how we are always going to protect the land 
and the cultural resources, and everything. But what can we do 
better tomorrow for our people?
    So, again, as I sit as the Chairman, it is still 
maintaining that consistency of we are going to protect that 
land at all cost. We have our water quality, air quality, we 
have our own standards that surpass the state of Colorado's, so 
everything that comes through, we are always about cultural 
resources, protecting the land, taking care of our elders, our 
children, just everything.
    I mentioned it as it is like the past leaders are building 
a house, and they built that foundation, and it is up to us 
today to finish that house, doing it in the right way, but 
utilizing their expertise that started this whole process.
    Ms. Leger Fernandez. Well, thank you very much. I have run 
out of time, so I will do it this way. If a shutdown would 
negatively impact the tribe or the tribes you serve, will you 
raise your hand?
    Thank you. I yield back.
    Mr. LaMalfa. Thank you. The gentlelady yields back. I will 
now recognize Mr. Carl for 5 minutes.
    Mr. Carl. Thank you, Mr. Speaker. Well, OK, Chairman.
    [Laughter.]
    Mr. Carl. Do you want to be Speaker? We will get you in 
line.
    [Laughter.]
    Mr. Carl. I don't think anybody wants that job on either 
side of the aisle.
    [Pause.]
    Mr. Carl. To the Indian Nation, I may not be the right 
person on this Committee, because I don't understand why as a 
Nation you have to come and ask for permission from the Federal 
Government to do something with your own land because we, the 
Federal Government, are the ones that put you on that land to 
start with. I think you should have the ability to determine 
your own future.
    I grew up around two Creek Indians. Mr. Pruitt was one of 
them, and I can't remember the second one's name. One of them 
did not have electricity and did not have water in his home, by 
choice. That may seem odd to some people in this room, but he 
was linked to his Native roots. I learned a lot from that man.
    Another man was a trapper who had come down from Michigan 
and he taught me how to trap, and we trapped hundreds and 
hundreds of beavers, and I learned from that man. And he had 
some very peculiar ways versus my ways, but I learned from that 
man. But he was where he wanted to be in that moment, in that 
time.
    I don't understand why we as a Federal Government think 
that we are so high and mighty that we can tell an Indian 
Nation, period, what they can do or what they cannot do. It 
frustrates me because the tribes that I work with and the 
Navajos I have been getting very close to lately, they are more 
than capable of running their own businesses and doing their 
own things.
    So, I would encourage you to start pushing back on the 
Federal Government. You have the power, and the power is in the 
votes. You don't get what you want from up here, look at the 
person, including me, look at the people that are unwilling to 
work for you and get them out of office. Get people on this 
Committee that want to work with you.
    Now, you are talking about needing information from the 
Department of Energy, there is no reason why you shouldn't have 
that information. That is your land. Taxpayer's money paid for 
that information and that information should be yours. I don't 
understand why we can't--oh, we are so important. We have a 
bill loss bureaucracy around it. We have to have another 
meeting, to have another meeting, to have another meeting.
    This is like serving on a board of the Southern Baptist 
Convention, I am telling you; it is all about more meetings. It 
is not that complicated. Turn me loose.
    What other group of people in America has to live by the 
rules that you have to live by? Tell me. I am telling you it is 
a modern-day term of slavery, and we need to start calling it 
what it is and quit being nice about it.
    And I got that off my chest. And I have found out I do have 
Indian roots. My tribe has long been gone, but it is OK, I 
still have Indian roots. I still have a little fire in myself. 
OK, I am sorry.
    Let's see. Chairman Baker, from your testimony, it is 
obvious that the Ute Indian Tribe has benefited from long-term 
planning and forward thinking about how to develop and use your 
resources. Can you discuss how the Tribe goes about making 
these big decisions and how these decisions may have been 
impacted by the Federal barriers?
    Mr. Baker. OK, yes. We have a department of the Tribe that 
is called the Growth Fund and within that we have our energy 
department. We have some very, very knowledgeable people. I 
mean, we hire them to do a good job. They have done an awesome 
job. They really push.
    And the way it works is whenever they come up with an 
acquisition or a deal they want to move forward on, we have in 
the middle what is called the Growth Fund Management Committee, 
so it goes to the next level. It has to have their approval 
before it can come to Tribal Council for final approval. And at 
that meeting, we will discuss or we can question that 
committee, that group, anything we want before we make a final 
approval. And it has to be in the best interest.
    And I just praise our teams. We have been so successful, 
and they do a diligent, awesome job for us.
    Mr. Carl. Thank you. I want you to understand there is good 
and bad in all cultures and all races, and it is good and bad. 
I have been exposed to nothing but good in the tribal 
community. Please take advantage, use me. I can be a voice. But 
we have to be one voice. We have to be one voice to be heard.
    So, get together, figure out how you can use me, or I will 
get out of the way if that is the case. But thank you for your 
patience with the Federal Government because I don't think you 
need the Federal Government.
    With that, I yield back.
    Mr. LaMalfa. Thank you, Mr. Carl. And, colleagues, if you 
wish, it looks like we might have a little time to do a second 
round of questioning since our panel is----
    Voice. We may not.
    Mr. LaMalfa. Or may not. Who has the gavel?
    [Laughter.]
    Mr. LaMalfa. I just got elevated to Speaker a while ago. 
But anyway, it is something we can consider, perhaps. I will go 
ahead and recognize myself for 5 minutes as hopefully our Chair 
gets back from the other committee in a moment as well.
    I am pleased to be able to represent far Northern 
California where we have many, many tribes that are represented 
there, and the issues are common with being remote areas, or 
energy, minerals, timber, other resource development is the 
best option for tribes and everyone else in a district in an 
area like that.
    So, when we take in the testimony from our witnesses today, 
I note that there are many similarities between the 
complications and the roadblocks that the tribes cite and along 
with what everybody else in my district cites as well, too, 
with rural governments run into that, and just roadblock after 
roadblock. You have common themes such as a process of approval 
that extends for years without even a clear end in sight. 
Regulations that require their own special training to even 
remotely understand them. Phrases and carveouts which are 
nonsensical to the average person and left completely undefined 
by our Federal agencies.
    So, we need to address these problems because the great 
harm it is going to put on Indian Country and Rural America in 
general without ability to economically develop except maybe 
tourism, right? Tourism is great, but we have to actually 
produce wealth that comes from the land. I am a farmer in my 
real life, so I get that as well.
    Let me toss a question. Mr. Baker, Congress tried to 
improve the tribal energy development agreements in 2017, we 
took a shot at it, but it really hasn't worked out to be as 
fruitful as we had hoped. So, you are pursuing a resource 
agreement under these new rules and regs that were finally put 
in place in 2019. So, what difficulties have you faced already, 
what difficulties would smaller tribes with fewer economic 
resources face than what you have available?
    Mr. Baker. Well, I think of what you mentioned, the 
setbacks, the things that we can work on together. But today is 
a new world, today is a new day. I am thankful that they are 
working with us and trying to move forward. I mean, I think 
every tribe is different, the setbacks, the things that we can 
or cannot do.
    But I just can't praise enough in all of my testimonies 
that, again, here we are together with our leaders, and working 
together with you to be a better tomorrow. Enough is enough. I 
think it is long overdue, and we have to all work together to 
do a better job. And as I mentioned, every tribe is different, 
so they all have their own challenges.
    Mr. LaMalfa. Certainly. And some have better ability to 
roll with the punches on that than others, but nobody should 
have to, as Mr. Carl was passionately talking about, why do you 
even have to be here to begin with if you are an autonomous 
federally recognized government. That is very frustrating for 
all of us.
    Let's see, where was I at as I made the jump. For Mr. Baker 
and Ms. Becker, both of your tribes have been successful in 
developing some amount of energy or mineral resources, but in 
your experience across the board, what are the barriers that 
separate tribes that can develop their own resources on their 
own land and those who can't? What do you find are the 
differences between tribes that have had success and not? Let 
me go to Ms. Becker, give you a chance first, then we will come 
to Mr. Baker.
    Ms. Becker. Thank you for the question. As Mr. Lovesee 
said, it is essentially an unequal playing field because of the 
permitting that we need to go through with the Federal 
Government. Even when we take over land leasing, which the 
Navajo Nation has done, and we can issue our own land leases, 
there are sub-elements where we still have to go back to the 
Federal Government and get their approval.
    I am going to point out one example because it touches on 
the whole spectrum of energy, and that is we are struggling 
right now with getting tree cutting permits from--and I see 
your reaction, Mr. Carl. We are struggling with that. I was 
just told by our Navajo tribal utility authority that is using, 
thank you, Congress, some of the American Rescue Plan Act 
funding to get electricity to people who would like 
electricity, and they have hit a log jam in getting a tree 
cutting permit out of the Bureau of Indian Affairs.
    That is one example of how even after we take over leasing 
we still have to go back to the Federal Government.
    Mr. LaMalfa. I am running out of time. I appreciate that 
comment, because in my own district, the town of Paradise, 
which 90 percent of it burned in what was known as the Camp 
Fire, 85 lives lost. Five years later, they are still trying to 
remove dead trees, and get permitting, and get a NEPA, and all 
this and all that. They removed some of the hazardous trees 
already, thankfully, but there is still a lot of work to be 
done.
    Mr. Desautel from Colville, I heard you, too, with what you 
are dealing with, because we have many, many 6-digit or larger 
fires. I had a 7-digit fire, a 1-million-acre fire 2 years ago 
known as the Dixie Fire. And it boils down to Federal land is 
not being managed in a way that makes for a good neighbor. What 
you were saying, good results happen on managed lands, even 
when they are adjacent to unmanaged ones, because we saw that 
in Paradise where a wildfire hit a managed area, the fire 
knocked right down. I hear you. We are going to keep after it.
    I will yield back, Madam Chair. I didn't have such a tough 
gavel when I ran it.
    [Laughter.]
    Ms. Hageman [presiding]. I am tough on people.
    I recognize myself for my 5 minutes of questions. Thank 
you.
    What you have described is I think the epitome of the old 
adage that the government is always trying to fix its last 
solution. And I really do look forward to working with you to 
find better solutions that actually meet the needs of the 
tribes rather than merely giving lip service to what it is that 
you need. The heavy hand of the Federal Government is just 
simply unacceptable, and the fact that it can take this amount 
of time for you to get the permits or the approvals that you 
need is just simply, again, I am going to use the word 
unacceptable.
    Also, Ms. Becker, you indicated that perhaps you were going 
to raise issues that were a little bit uncomfortable. If we 
don't have uncomfortable discussions, we are not going to have 
any discussions at all. If our agencies are failing our tribes 
at addressing these energy issues that are not only critical to 
you but critical to the United States of America, then we are 
failing everybody.
    I want to thank you for what you do in Wyoming, for what 
your Tribe does in Wyoming. You guys are a fabulous neighbor, a 
fabulous producer. We appreciate how you operate, and we 
appreciate what every one of you are trying to do in terms of 
improving this situation for your tribal members.
    Mr. Baker, the TERA concept seems to hold a lot of promise 
for those tribes like the Southern Ute that want more control 
over resource decisions on your own lands. However, no tribe 
has yet submitted one to the Department of the Interior for 
approval. Can you elaborate on your testimony a little bit and 
discuss more about the inherent Federal function issue that has 
affected your Tribe's decision on whether to submit a TERA and 
why it is important to solve it?
    Mr. Baker. Well, again, as we mentioned, no tribe has 
entered that. I think our Tribe has been asking for 
clarification for many years on that. And it does make an 
impact on how we are going to move forward. But, again, it just 
appears that with the TERA regulations, it is like saying we 
are going to play a game but the government is not telling us 
the rules of the game. Why do we want to waste time and money? 
We have already done that in the past where we put a lot of our 
staff ahead to try to get ahead of this and it really boiled 
down to nothing.
    So, for us, it was a loss of funding. And I think we have 
to move cautiously how we are going to do things. And we have 
held back on some of that because, again, we don't know the 
rules, we just are not working together. I feel that the 
Federal Government is not doing their part.
    I mean, it should be a simple answer. It should be a simple 
question. And, again, as we sit here today, that is what we are 
all here for as leaders to talk. How can we see a better 
tomorrow? How can we work together?
    And you all know the challenges of every tribe are 
different, so help us get through it. And with that, I believe 
our own tribes, they work with each other. They ask how did you 
do that, how did you do this. They meet, at certain meetings 
they talk about these issues, the challenges. But it just seems 
like for years nothing has ever come out of it, and that is why 
they are really being cautious on not moving forward.
    Ms. Hageman. And I take it that you are seeking 
clarification from Federal agencies, but that clarification has 
not been forthcoming?
    Mr. Baker. Right.
    Ms. Hageman. OK. So, then I am going to challenge the four 
of you, and I am going to ask you to do something for us. I 
would like you to put together the checklist, or the 
information, or the documentation of what you believe our 
agencies should be doing. You bring that to us and then let's 
see if we can solve it from your standpoint.
    Because if these agencies are not moving forward with the 
projects, or you are not able to move forward with the 
projects, because the agencies are neither clarifying, nor 
responding, nor dealing with the individual situations that 
every single one of your tribes have or any other tribe around 
this country, then we need to solve it from the ground up. 
Coming to Washington, DC and saying that the Department of the 
Interior or the Secretary of the Interior is not giving us the 
information, we know that, and that is the frustration that we 
have.
    I want your help in knowing what I need to ask the 
Secretary of the Interior to do. Tell us how to make these 
programs better, and we will try to fix them. This should never 
be at top-down approach. We need to come to you and say, how do 
we go about making sure that we do get the permits that we need 
to be able to remove the trees? Why in the world would it take 
years to do that?
    That is an absolute absurdity and it kind of demonstrates 
how broken this place can be, but it is also why I have worked 
as hard as I have to try to return autonomy to the tribes 
because you are the ones who can make the better decisions that 
are going to be in the best interest of your members and you 
are actually going to be able to succeed to accomplish 
something. So, help us help you. I am all ears. I will work 
with you.
    Mr. Baker, what is your response?
    Mr. Baker. Yes. And I would like to say the Southern Ute 
Tribe would like to work with the Committee to address the 
issue to bring clarity and certainty to the TERA idea. Again, 
you mentioned how can we help you help us, and that is one of 
our philosophies even working with the local BIA. There are a 
lot of things we cannot get done, and we have to the point 
where we are asking the BIA how can we help you help us.
    We have to work together. We are, as a tribe, reaching out 
because we need things to move along, but you are not doing it. 
We always get the excuses of they don't have the 
professionalism. Well, the tribes do. We do. But you are 
holding us back. How can you help us help us.
    And, again, just indicating that the Tribe would be willing 
to work with how we can bring certainty to the TERA.
    Ms. Hageman. I have a lot more questions I wanted to ask 
you, and I kind of got on my soapbox, but I am going to tell 
you, I am two floors above here. You come here and you come and 
talk to my staff, and we will sit down, and we need to make 
that list. We need to have an idea of where to go because I 
don't have the answers, but you do. So, help us fix this.
    And with that, I will call on our Chairman, Mr. Westerman, 
for his 5 minutes of questioning.
    Mr. Westerman. I am not sure I want to follow that.
    [Laughter.]
    Mr. Westerman. Thank you to the witnesses for being here 
today. This is an issue or an area that is very important to my 
role as Chairman of the Committee and to the outlook that we 
are trying to lead the whole Resources Committee and especially 
this Subcommittee. And I want to commend the Subcommittee 
Chair, Representative Hageman, for the excellent work that she 
is doing in putting together hearings like this on tribal 
sovereignty.
    I have told folks when we talk about tribal sovereignty, it 
is not just talk, we want to see action. And the reason you all 
have been selected for this panel, or invited to be here today, 
is because you come from an area where I would say there is a 
lot less talk and a lot more action. You are getting things 
done, whether it is in resource management, or finance, or 
whatever area you work in.
    And I had the good privilege to be out and visit the 
Colville Tribe last year and traveled around and looked at some 
of the great work that is being done there, and I thought, this 
needs to be replicated. But also, was a little frustrated 
because of the boundaries and barriers that were being put in 
place by people far away from the Colville Tribe, and I saw so 
much more potential.
    And, Mr. Desautel, I know that you all are working on an 
agreement for a planned biochar facility in Kettle Falls, which 
is a beautiful place, by the way. But can you further expand on 
how new biochar and/or biomass projects can benefit the 
management of tribal forests?
    Mr. Desautel. Sure. I think when you look at tribes across 
the West, many of them have leaned on timber as a source of 
revenue to support their tribal government for decades, but 
there has not been a place for those non-merchantable forest 
products. And now we recognize that not only are those a source 
of revenue, but they are a source of fuel that has fueled 
wildfires that have damaged Indian Country for the last couple 
decades in particular.
    So, if we can find a way to utilize those materials in a 
cost-efficient way or potentially even a way that generates 
some additional revenue for the Tribe, that would be a huge 
opportunity for the Tribe to improve management and resilience 
on their own lands. But with the authorities Congress has given 
us over the last few years with the Tribes' ability to work 
with its partnering Federal agencies, we can do that work not 
only on our land but on adjacent Federal land, too.
    So, I think there is a great opportunity if you can develop 
the infrastructure and the markets that make good use of those 
non-commercial forest products that right now are going up in 
flames contributing to global warming and burning down 
communities.
    Mr. Westerman. Yes. And how could a reauthorized tribal 
biomass project specifically help development at Kettle Falls?
    Mr. Desautel. When we look at the development of a project 
like that, the infrastructure costs are huge, so financing for 
that is something that is going to take probably 2 or 3 years 
to work through, and I am sure the payback timeline is going to 
be a couple decades. So, you have to have a supply commitment 
that matches the payback timeline of that facility. When you 
are looking at roughly 20 years for a facility like that to pay 
for itself, you have to ensure that you have supply for that 
over that time.
    You have seen mills close over the last couple decades 
because of that and many of them never reopen because they just 
couldn't secure the financing they needed because historically 
a lot of that wood came from Federal forests and there is just 
no confidence that that will happen in the future. But if you 
can enter into these long-term supply agreements, there is some 
confidence by the banking industry that those loans will be 
paid, that those facilities will operate.
    And if we have that authority--the problem is that we had 5 
years to do it. That is a pretty short timeline to put together 
projects that are in the neighborhood of $50 to $100 million to 
build and the capacity and contracting capacity that you need 
to add is substantially bigger, and it takes time to do that.
    So, I think if we have a reauthorization, hopefully it is 
for a longer period of time and hopefully permanent at some 
point. I hope the intent of the pilot project was just to test 
its concept, and in the long-term it would just be a tool we 
put in our toolbox.
    Mr. Westerman. And as was talked about, when we were out, 
we saw some of the tracks that you all had managed, and done a 
phenomenal job with, and I guess it was that fire in 2015 that 
had firefighters tied up on unmanaged Federal forest. So, not 
only did the failure to manage the adjacent Federal forest 
result in that forest being destroyed, it took resources away 
from fighting the fire on land that you all had done a good job 
of managing.
    And you are exactly right, if we can use this biomass to 
make energy, it is good for the forest, it is good for the 
economy, it is good for the environment, and a whole host of 
benefits that you get from that. But I understand the 
complexities of trying to build the project that can be 
millions and millions of dollars and not having any certainty.
    And, Mr. Lovesee, I am going to give you just a couple of 
minutes to talk about, or seconds, I guess. How important is it 
from a financial standpoint when somebody comes in to do a 
project to have the certainty that you are going to have the 
resources to be able to do that project?
    Mr. Lovesee. I mean, certainty is everything when it comes 
to a project. And, unfortunately, we are still in the process 
of figuring out what partnerships can be done. There are even 
issues right now with what the IRS can provide as far as 
guidance when doing some of the projects and some of these 
partnerships.
    We have been trying to work with Treasury on that, but I 
know that they have even said they need to come back and talk 
with Congress about the authorization to even be able to answer 
tribes' questions, because right now there is nowhere tribes 
can go when it comes to being able to get some of these 
questions answered, as far as being able to work with what 
partnerships and what financing options they have available, 
especially for something like direct pay credits. There is 
nowhere they can go on the Federal Government side.
    So, it is everything. I mean, you can't do an energy 
project if you don't know where your financing is going to come 
from or what it is going to look like 5, 6 years down the road. 
And, unfortunately, we are just not there.
    Mr. Westerman. Madam Chair, I would just add that if we 
could just clear the way so they could do what they do best and 
take the barriers away, they are so far ahead of our Federal 
land managers in so many places that I have traveled around the 
country and visited that we are missing a huge opportunity by 
not empowering our tribal partners to do more of what they do 
best.
    And I am way out of time, so I yield back.
    [Laughter.]
    Ms. Hageman. But, Mr. Chairman, I want to thank you for 
being here today and joining us on what I think is one of the 
more important panels that we have had.
    The future of energy production, and our tribal autonomy, 
and the future of your communities is really at stake with some 
of the things we are talking about today.
    I thank the witnesses for your valuable testimony and the 
Members for their questioning.
    The members of the Committee may have some additional 
questions for the witnesses, and we will ask you to respond to 
those in writing. Under Committee Rule 3, members of the 
Committee must submit such questions to the Committee Clerk by 
5 p.m. on Tuesday, October 3, 2023. The hearing record will be 
held open for 10 business days for these responses.
    If there is no further business, without objection, the 
Committee stands adjourned.

    [Whereupon, at 11:26 a.m., the Subcommittee was adjourned.]

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