[House Report 107-632]
[From the U.S. Government Publishing Office]




107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     107-632
======================================================================
 
     CHEROKEE, CHOCTAW, AND CHICKASAW NATIONS CLAIMS SETTLEMENT ACT
                                _______
                                

 September 4, 2002.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

  Mr. Hansen, from the Committee on Resources, submitted the following

                              R E P O R T

                        [To accompany H.R. 3534]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Resources, to whom was referred the bill 
(H.R. 3534) to provide for the settlement of certain land 
claims of Cherokee, Choctaw, and Chickasaw Nations to the 
Arkansas Riverbed in Oklahoma, having considered the same, 
report favorably thereon with an amendment and recommend that 
the bill as amended do pass.

    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Cherokee, Choctaw, and Chickasaw 
Nations Claims Settlement Act''.

SEC. 2. FINDINGS.

  The Congress finds the following:
          (1) It is the policy of the United States to promote tribal 
        self-determination and economic self-sufficiency and to 
        encourage the resolution of disputes over historical claims 
        through mutually agreed-to settlements between Indian Nations 
        and the United States.
          (2) There are pending before the United States Court of 
        Federal Claims certain lawsuits against the United States 
        brought by the Cherokee, Choctaw, and Chickasaw Nations seeking 
        monetary damages for the alleged use and mismanagement of 
        tribal resources along the Arkansas River in eastern Oklahoma.
          (3) The Cherokee Nation, a federally recognized Indian tribe 
        with its present tribal headquarters near Tahlequah, Oklahoma, 
        having adopted its most recent constitution on June 26, 1976, 
        and having entered into various treaties with the United 
        States, including but not limited to the Treaty at Hopewell, 
        executed on November 28, 1785 (7 Stat. 18), and the Treaty at 
        Washington, D.C., executed on July 19, 1866 (14 Stat. 799), has 
        maintained a continuous government-to-government relationship 
        with the United States since the earliest years of the Union.
          (4) The Choctaw Nation, a federally recognized Indian tribe 
        with its present tribal headquarters in Durant, Oklahoma, 
        having adopted its most recent constitution on July 9, 1983, 
        and having entered into various treaties with the United States 
        of America, including but not limited to the Treaty at 
        Hopewell, executed on January 3, 1786 (7 Stat. 21), and the 
        Treaty at Washington, D.C., executed on April 28, 1866 (7 Stat. 
        21), has maintained a continuous government-to-government 
        relationship with the United States since the earliest years of 
        the Union.
          (5) The Chickasaw Nation, a federally recognized Indian tribe 
        with its present tribal headquarters in Ada, Oklahoma, having 
        adopted its most recent constitution on August 27, 1983, and 
        having entered into various treaties with the United States of 
        America, including but not limited to the Treaty at Hopewell, 
        executed on January 10, 1786 (7 Stat. 24), and the Treaty at 
        Washington, D.C., executed on April 28, 1866 (7 Stat. 21), has 
        maintained a continuous government-to-government relationship 
        with the United States since the earliest years of the Union.
          (6) In the first half of the 19th century, the Cherokee, 
        Choctaw, and Chickasaw Nations were forcibly removed from their 
        homelands in the southeastern United States to lands west of 
        the Mississippi in the Indian Territory which that were ceded 
        to them by the United States. From the ``Three Forks'' area 
        near present day Muskogee, Oklahoma, downstream to the point of 
        confluence with the Canadian River, the Arkansas River flowed 
        entirely within the territory of the Cherokee Nation. From that 
        point of confluence downstream to the Arkansas territorial 
        line, the Arkansas River formed the boundary between the 
        Cherokee Nation on the left side of the thread of the river and 
        the Choctaw and Chickasaw Nations on the right.
          (7) Pursuant to the Act of April 30, 1906 (34 Stat. 137), 
        title to the bed and banks of the Arkansas River passed to the 
        United States in trust for the respective Indian Nations in 
        accordance with their respective interests therein.
          (8) For more than 60 years after Oklahoma statehood, the 
        Bureau of Indian Affairs incorrectly assumed that Oklahoma 
        owned the Riverbed from the Arkansas State line to Three Forks, 
        and therefore took no action to protect the Indian Nations' 
        Riverbed resources such as oil, gas, sand, and gravel and 
        Drybed Lands suitable for grazing and agriculture.
          (9) The United States Government constructed powerheads and 
        other improvements in the channel of the Arkansas River on 
        tribal lands, using sand and gravel belonging to the three 
        Indian Nations. Due to the Bureau's inaction, individuals with 
        property near the Arkansas River began to occupy the three 
        Indian Nations' Drybed Lands--lands that were under water at 
        the time of statehood but that are now dry due to changes in 
        the course of the river.
          (10) In 1966, the three Indian Nations sued the State of 
        Oklahoma to recover their lands. In 1970, the Supreme Court of 
        the United States decided in the case of Choctaw Nation vs. 
        Oklahoma (396 U.S. 620 (1970)), that the Indian Nations 
        retained title to their respective portions of the Riverbed 
        along the navigable reach of the river.
          (11) In 1989, the Indian Nations filed lawsuits against the 
        United States in the United States Court of Federal Claims 
        (Case Nos. 218-89L and 630-89L), seeking damages for the United 
        States use and mismanagement of tribal trust resources along 
        the Arkansas River. Those actions are still pending.
          (12) In 1997, the United States filed quiet title litigation 
        against individuals occupying some of the Indian Nations' 
        Drybed Lands. That action, filed in the United States District 
        Court for the Eastern District of Oklahoma, was dismissed 
        without prejudice on technical grounds.
          (13) From time to time over the years following the Indian 
        Nations' Court of Federal Claims litigation, the Indian 
        Nations, the Department of Justice, the Bureau of Indian 
        Affairs, and the Indian Nations have engaged in settlement 
        negotiations.
          (14) Nearly 7,750 acres of the Indian Nations' Drybed Lands 
        have been occupied by a large number of adjacent landowners in 
        Oklahoma. Without Federal legislation, further litigation 
        against thousands of such landowners would be likely and any 
        final resolution of pending disputes through a process of 
        litigation would take many years and entail great expense to 
        the United States, the Indian Nations, and the individuals and 
        entities occupying the Drybed Lands and would seriously impair 
        long-term economic planning and development for all parties.
          (15) The Councils of the Cherokee, Choctaw, and Chickasaw 
        Nations have each enacted tribal legislation which would, 
        contingent upon the passage of this Act and in exchange for the 
        monies appropriated hereunder--
                  (A) settle and forever release their respective 
                claims against the United States asserted by them in 
                United States Court of Federal Claims Case Nos. 218-89L 
                and 630-89L; and
                  (B) forever disclaim any and all right, title, and 
                interest in and to the Disclaimed Drybed Lands, as set 
                forth in those enactments of the respective councils of 
                the Indian Nations.
          (16) The resolutions adopted by the respective Councils of 
        the Cherokee, Choctaw, and Chickasaw Nations each provide that, 
        contingent upon the passage of the settlement legislation, each 
        Indian Nation agrees to dismiss, release, and forever discharge 
        its claims asserted against the United States in the United 
        States Court of Federal Claims, Case No. 218-89L, and to 
        disclaim any right, title, or interest of the Indian Nation in 
        the Disclaimed Drybed Lands, in exchange for the funds 
        appropriated and allocated to the Indian Nation under the 
        provisions of the settlement legislation, which funds the 
        Indian Nation agrees to accept in full satisfaction and 
        settlement of all claims against the United States for its use 
        of and damage to the bed of the Arkansas River arising out of 
        the construction of the McClellan-Kerr Navigation Way and for 
        the damages sought in the aforementioned claims asserted in the 
        United States Court of Federal Claims, and as full and fair 
        compensation for disclaiming its right, title, and interest in 
        the Disclaimed Drybed Lands.
          (17) In those resolutions, each Indian Nation expressly 
        reserved all of its beneficial interest and title to all other 
        Riverbed lands, including minerals, as determined by the 
        Supreme Court in Choctaw Nation v. Oklahoma, 397 U.S. 620 
        (1970), and further reserved any and all right, title, or 
        interest that each Nation may have in and to the water flowing 
        in the Arkansas River and its tributaries.

SEC. 3. PURPOSES.

  The purposes of this Act are as follows:
          (1) To approve, ratify, and confirm an agreed-to resolution 
        of claims brought by the Cherokee, Choctaw, and Chickasaw 
        Nations against the United States, and the agreed-to 
        disclaimers of the three Indian Nations to any right, title, or 
        interest in approximately 7,750 acres of Drybed Lands 
        contiguous to the channel of the Arkansas River as of the date 
        of the enactment of this Act in certain townships in eastern 
        Oklahoma.
          (2) To reserve the three Indian Nations' beneficial interest 
        in the Riverbed except for the Disclaimed Drybed Lands.
          (3) To authorize and direct the Secretary to implement the 
        terms of such settlement.
          (4) To authorize the actions and appropriations necessary to 
        implement the provisions of this Act.
          (5) To maintain the trust relationship between the United 
        States and each of the three Indian Nations.

SEC. 4. DEFINITIONS.

  For the purposes of this Act, the following definitions apply:
          (1) Disclaimed drybed lands.--The term ``Disclaimed Drybed 
        Lands'' means all Drybed Lands along the Arkansas River that 
        are located in Township 10 North in Range 24 East, Townships 9 
        and 10 North in Range 25 East, Township 10 North in Range 26 
        East, and Townships 10 and 11 North in Range 27 east, in the 
        State of Oklahoma.
          (2) Drybed lands.--The term ``Drybed Lands'' means those 
        Riverbed lands of the Indian Nations which lie above and 
        contiguous to the high water mark of the Arkansas River in the 
        State of Oklahoma as of the date of the enactment of this Act 
        but which have become part of the Riverbed by operation of 
        accretion and avulsion.
          (3) Indian nation; indian nations.--The term ``Indian 
        Nation'' means the Cherokee Nation, Choctaw Nation, or 
        Chickasaw Nation, and the term ``Indian Nations'' means all 
        three tribes collectively.
          (4) Riverbed.--The term ``Riverbed'' means the Drybed Lands 
        and the Wetbed Lands and includes all minerals therein.
          (5) Secretary.--The term ``Secretary'' means the Secretary of 
        the Interior.
          (6) Wetbed lands.--The term ``Wetbed Lands'' means those 
        Riverbed lands which lie below the high water mark of the 
        Arkansas River in the State of Oklahoma as of the date of the 
        enactment of this Act, exclusive of the Drybed Lands.

SEC. 5. SETTLEMENT AND CLAIMS; APPROPRIATIONS; ALLOCATION OF FUNDS.

  (a) Extinguishment of Claims.--Upon payment of the funds appropriated 
under this section, all claims for use of and damage to the Riverbed 
arising out of the construction and maintenance of the McClellan-Kerr 
Navigation Way and the claims asserted by the Cherokee, Choctaw, and 
Chickasaw Nations in the United States Court of Federal Claims against 
the United States shall be deemed extinguished.
  (b) Release of Tribal Claims to Certain Drybed Lands.--
          (1) In general.--Upon the deposit of all funds authorized for 
        appropriation under subsection (c) for an Indian Nation into 
        the appropriate trust fund account described in section 6, all 
        claims and all right, title, and interest that the Indian 
        Nations may have to the Disclaimed Drybed Lands, shall be 
        deemed extinguished. The Secretary shall execute an appropriate 
        document citing this Act, suitable for filing with the county 
        clerks, or such other county official as appropriate, of those 
        counties wherein the foregoing described lands are located, 
        disclaiming tribal interests in such Disclaimed Drybed Lands.
          (2) Exception.--Notwithstanding any provision of this Act, 
        the Indian Nations do not relinquish any right, title, or 
        interest in any lands or minerals to which the United States 
        claims title which are contiguous to the Riverbed, and no 
        provision of this Act shall be construed to extinguish or 
        convey any water rights of the Indian Nations in the Arkansas 
        River or any other stream or the beneficial interests or title 
        of any of the Indian Nations in and to trust lands lying above 
        or below the high water mark of the Arkansas River as of the 
        date of the enactment of this Act, except for the Disclaimed 
        Drybed Lands.
          (3) Land to be taken into trust.--To the extent that the 
        United States determines that it is able to effectively 
        maintain the McClellan-Kerr Navigation Way without retaining 
        title to lands above the high water mark of the Arkansas River 
        as of the date of the enactment of this Act, said lands, after 
        being declared surplus, shall be taken into trust for the 
        Indian Nation within whose boundary the land is located. All 
        Wetbed Lands, including minerals, from the Arkansas State line 
        upstream to the historic point of navigability near the 
        confluence of the Arkansas, Verdigris, and Grand Rivers, and 
        all Drybed Lands located outside the foregoing described 
        Townships, shall continue to be held by the United States in 
        trust for the beneficiary Indian Nation and shall be protected 
        in accordance with applicable law governing tribal trust lands.
  (c) Authorization for Settlement Appropriations.--
          (1) Settlement of claims.--There is authorized to be 
        appropriated the aggregate sum of $41,293,245. After payment 
        pursuant to section 7, the remaining funds appropriated under 
        this subsection shall be paid and allocated among the three 
        Indian Nations in accordance with subsection (d) and deposited 
        into the trust fund accounts established pursuant to section 6. 
        Such payment shall be in full satisfaction and settlement of 
        the Indian Nations' claims for the use of and damage to the 
        Arkansas Riverbed arising out of the construction and 
        maintenance of the McClellan-Kerr Navigation Way and asserted 
        against the United States in the United States Court of Federal 
        Claims, Case Nos. 218-89L and 630-89L, and in full satisfaction 
        of, and as compensation for, the three Indian Nations' 
        respective right, title, and interest in and to the Disclaimed 
        Drybed Lands.
          (2) Rentals.--In addition to funds authorized to be 
        appropriated in paragraph (1), there is authorized for 
        appropriation and allocated in accordance with subsection (d) 
        $8,000,000, representing the present value of the fair market 
        rentals for the location and future operation in perpetuity of 
        the two hydropower generation and related facilities at the 
        Webbers Falls Lock and Dam and the Kerr Lock and Dam on the 
        Arkansas River.
  (d) Allocation and Deposit of Funds.--After payment pursuant to 
section 7, the remaining funds authorized for appropriation under 
subsection (c) shall be allocated among the Indian Nations as follows:
          (1) 50 percent to be deposited into the trust fund account 
        established under section 6 for the Cherokee Nation.
          (2) 37.5 percent to be deposited into the trust fund account 
        established under section 6 for the Choctaw Nation.
          (3) 12.5 percent to be deposited into the trust fund account 
        established under section 6 for the Chickasaw Nation.

SEC. 6. TRIBAL TRUST FUNDS.

  (a) Trust Fund Accounts and Uses of Trust Funds.--All funds 
appropriated and paid pursuant to section 5 shall be deposited into 
three separate tribal trust fund accounts to be established by the 
Secretary for the benefit of each of the three Indian Nations. All 
funds deposited into said accounts, and any income earned thereon, 
shall be expended only in accordance with the provisions of this 
section. No funds deposited into the trust fund accounts established in 
section 6 shall be made available to the beneficiary Indian Nation 
until that Nation files the appropriate stipulation of dismissal with 
prejudice of all claims asserted in Case Nos. 218-89L or 630-89L, filed 
in the United States Court of Federal Claims.
  (b) Land Acquisition.--
          (1) Trust land status pursuant to regulations.--The funds 
        appropriated and allocated to the Indian Nations pursuant to 
        section 5(c) and deposited into trust fund accounts pursuant to 
        section 6(a), together with any interest earned thereon, and 
        allocated pursuant to section 5(d) may be used for the 
        acquisition of land by the three Indian Nations for transfer to 
        the United States in trust for the beneficiary Indian Nation in 
        accordance with the Secretary's trust land acquisition 
        regulations at part 151 of title 25, Code of Federal 
        Regulations, as in effect on January 1, 2001.
          (2) Required trust land status.--Any such trust land 
        acquisitions on behalf of the Cherokee Nation shall be 
        mandatory if the land proposed to be acquired is located within 
        Township 12 North, Range 21 East, in Sequoyah County, Township 
        11 North, Range 18 East, in McIntosh County, Townships 11 and 
        12 North, Range 19 East, or Township 12 North, Range 20 East, 
        in Muskogee County, Oklahoma, and not within the limits of any 
        incorporated municipality as of January 1, 2002, if--
                  (A) the land proposed to be acquired meets the 
                Department of the Interior's minimum environmental 
                standards and requirements for real estate acquisitions 
                set forth in 602 DM 2.6, as in effect on January 1, 
                2001; and
                  (B) the title to such land must meet applicable 
                Federal title standards as in effect on said date.
          (3) Other expenditure of funds.--The Indian Nations may elect 
        to expend all or a portion of the funds deposited into its 
        trust account for any other purposes authorized under 
        subsection (c).
  (c) Investment of Trust Funds; No Per Capita Payment.--
          (1) No per capita payments.--No money received by the Indian 
        Nations hereunder may be used for any per capita payment.
          (2) Investment by secretary.--Except as provided in this 
        section and section 7, the principal of such funds deposited 
        into the accounts established hereunder and any interest earned 
        thereon shall be invested by the Secretary in accordance with 
        current laws and regulations for the investing of tribal trust 
        funds.
          (3) Use of principal funds.--The principal amounts of said 
        funds and any amounts earned thereon shall be made available to 
        the Indian Nation for which the account was established for 
        expenditure for purposes which may include construction or 
        repair of health care facilities, law enforcement, cultural or 
        other education activities, economic development, social 
        services, and land acquisition. Land acquisition using such 
        funds shall be subject to the provisions of subsections (b) and 
        (d).
  (d) Disbursement of Funds.--The Secretary shall disburse the funds 
from a trust account established under this section pursuant to a 
budget adopted by the Council of the Indian Nation setting forth the 
amount and an intended use of such funds.

SEC. 7. ATTORNEY FEES.

  (a) Payment.--At the time the funds are paid to the Indian Nations, 
from funds authorized to be appropriated pursuant to section 5(c), the 
Secretary shall pay to the Indian Nations' attorneys those fees 
provided for in the individual tribal attorney fee contracts as 
approved by the respective Indian Nations.
  (b) Limitations.--Notwithstanding subsection (a), the total fees 
payable to attorneys under such contracts with an Indian Nation shall 
not exceed 10 percent of that Indian Nation's allocation of funds 
appropriated under section 5(c).

                          PURPOSE OF THE BILL

    The purpose of H.R. 3534, as ordered reported, is to 
provide for the settlement of certain land claims of the 
Cherokee, Choctaw, and Chickasaw Nations to the Arkansas 
Riverbed in Oklahoma.

                  BACKGROUND AND NEED FOR LEGISLATION

    H.R. 3534 is a comprehensive legislative settlement of all 
claims asserted by the Cherokee, Choctaw, and Chickasaw Nations 
for the use and mismanagement of tribal resources along the 
Arkansas River. The legislation extinguishes all of the 
Nations' claims to the so-called Disclaimed Drybed Lands and 
authorizes a total $49,293,245 in appropriated claim settlement 
funds to be allocated in specified trust fund accounts among 
the Cherokee, Choctaw, and Chickasaw Nations. Of the settlement 
amount, 50 percent would be held for the Cherokee Nation, 37.5 
percent for the Choctaw Nation, and 12.5 percent for the 
Chickasaw Nation.
    For more than 60 years following Oklahoma's statehood, the 
Bureau of Indian Affairs erroneously assumed that the State 
retained ownership of the Arkansas Riverbed from the Arkansas 
State line to Three Forks. The Cherokee, Choctaw, and Chickasaw 
Nations asserted that their Treaties superseded the Equal 
Footing Doctrine regarding navigable rivers and that ownership 
of the Arkansas Riverbed should remain with the tribes.
    Due to the Bureau's inaction, the federal government 
constructed power heads and made other improvements in the 
channel of the riverbed on tribal land, using sand and gravel 
belonging to the three Nations. In addition, individuals with 
property near the river began to occupy the Drybed Lands lands 
that were under water at the time of Oklahoma Statehood but 
that are now dry. In 1966, the three Indian Nations sued the 
State of Oklahoma to recover their lands and in 1970, the U.S. 
Supreme Court ruled that ownership of the riverbed remained 
with the tribes. The decision gave the northern half of the 
riverbed to the Cherokee Nation from the Arkansas line west to 
the confluence with the Canadian River and the southern half of 
the riverbed jointly to the Choctaws and Chickasaws.
    In 1989, the three Indian Nations filed lawsuits against 
the United States seeking damages for the use and mismanagement 
of tribal trust resources along the Arkansas River. To date, 
negotiations on the settlement of the three Nations' claim 
against the United States have continued without resolve. The 
Councils of the Cherokee, Choctaw, and Chickasaw Nations have 
enacted tribal legislation releasing their respective claims 
against the United States and extinguishing any and all right, 
title, and interest in the Drybed Lands. H.R. 3534 codifies the 
three Nations' settlement.

                            COMMITTEE ACTION

    H.R. 3534 was introduced on December 19, 2001, by 
Congressman Brad Carson (D-OK), and was subsequently referred 
to the Committee on Resources. On April 17, 2002, the Committee 
held a hearing on the bill, and on June 26, 2002, the Committee 
met to mark up the legislation. Congressman Carson offered an 
amendment in the nature of a substitute to make certain 
technical and clarifying revisions. The legislation, as 
amended, was ordered favorably reported to the House of 
Representatives by unanimous consent.

        SECTION-BY-SECTION ANALYSIS OF BILL AS ORDERED REPORTED

Section 1. Short title

    This section sets out the short title of the bill, the 
``Cherokee, Choctaw, and Chickasaw Nations Claims Settlement 
Act.''

Section 2. Findings

    This section sets forth the findings prompting the need for 
the legislation.

Section 3. Purposes

    This section sets forth the purpose of the bill: to approve 
the settlement (described above); to reserve the three Nations' 
beneficial interest in the riverbed except for the ``disclaimed 
drybed lands;'' to authorize the Secretary of the Interior to 
implement the settlement; to authorize the appropriations 
necessary to implement the bill; and to preserve the trust 
relationship between the U.S. and each of the three Nations.

Section 4. Definitions

    This section sets forth the definitions for the bill.

Section 5. Settlement and claims; Appropriations; Allocation of funds

    Subsection (a) states that the three Nations' claims 
against the United States will be extinguished upon payment of 
the funds authorized to be appropriated under the bill.
    Subsection (b) states that on deposit of the appropriated 
funds into the trust accounts pursuant to section 6 of the 
bill, the three Nations' interests in the Disclaimed Drybed 
Lands shall be deemed extinguished. The Secretary of the 
Interior is authorized to file the appropriate documents with 
the county clerks for the counties where the Disclaimed Drybed 
Lands are located. The other Riverbed resources are expressly 
reserved, as are any water rights the three Nations may have. 
Other federal lands above the highwater mark, to the extent 
unnecessary for maintaining the navigation way and upon being 
declared surplus, are to be taken into trust for the Nations.
    Subsection (c) authorizes for appropriation the aggregate 
sum of $41,293,245 for allocation among the three Nations in 
accordance with subsection (d)--50 percent to the Cherokee 
Nation, 37.5 percent to the Choctaw Nation, and 12.5 percent to 
the Chickasaw Nation--after making the payment authorized by 
section 7 (attorneys fees according to their contracts, not to 
exceed ten percent of the settlement), as full settlement and 
satisfaction for claims pending against the U.S. and for their 
disclaimed interests in the Disclaimed Drybed Lands. This 
subsection further authorizes an appropriation of $8 million as 
fair present value of past and future use of tribal lands for 
the two hydropower facilities on the river.
    Subsection (d) sets out the percentages for allocating 
settlement funds among the three Nations.

Section 6. Tribal Trust Funds

    Subsection (a) states that all appropriated funds will be 
deposited into separate tribal trust fund accounts for the 
benefit of the three Indian Nations, that the funds may only be 
expended in accordance with the provisions this section, and 
that none of the funds will be made available to a Nation until 
it has executed and filed a stipulation of dismissal in the 
Court of Federal Claims cases.
    Subsection (b) states that the appropriated funds deposited 
into in the Tribal trust accounts and any interest earned 
thereon may be used for land acquisitions pursuant to the 
Secretary's regulations, except that trust acquisitions on 
behalf of the Cherokees are mandatory if the land proposed to 
be acquired is located in certain sections in Sequoyah, 
McIntosh, or Muskogee Counties, provided that the land is not 
located within the boundaries of any municipality and it meets 
the Secretary's minimum environmental and title standards.
    Subsection (c) prohibits use of the settlement funds for 
per capita payments, and requires the Secretary to invest the 
funds in accordance with applicable laws and regulations. It 
also allows the funds to be used for construction or repair of 
health care facilities, law enforcement, cultural or other 
education activities, economic development, social services, 
and land acquisition, provided that the acquisition of land 
complies with to the requirements of subsections (b) and (d).
    Subsection (d) requires disbursement of the funds from a 
trust account established under section 6 pursuant to budgets 
adopted by the council of the Nation setting forth the amount 
and intended use of the funds.

Section 7. Attorney fees

    This section authorizes the Secretary to pay the Nations' 
attorneys those sums owed them under their respective 
contracts, but imposes a cap of ten percent of the Nation's 
allocation of funds appropriated under section 5(c).

            COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Resources' oversight findings and recommendations 
are reflected in the body of this report.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Article I, section 8 of the Constitution of the United 
States grants Congress the authority to enact this bill.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act. As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, spending 
authority, credit authority, or an increase or decrease in 
revenues or tax expenditures.
    3. General Performance Goals and Objectives. As required by 
clause 3(c)(4) of rule XIII, the general performance goal or 
objective of this bill is to provide for the settlement of 
certain land claims of the Cherokee, Choctaw, and Chickasaw 
Nations to the Arkansas Riverbed in Oklahoma.
    4. Congressional Budget Office Cost Estimate. Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, August 28, 2002.
Hon. James V. Hansen,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3534, the 
Cherokee, Choctaw, and Chickasaw Nations Claims Settlement Act.
    If you wish further details of this estimate, we will be 
pleased to provide them. The CBO staff contacts are Lanette J. 
Walker (for federal costs), Marjorie Miller (for the state, 
local, and tribal impact), and Cecil McPherson (for the 
private-sector impact).
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

H.R. 3534--Cherokee, Choctaw, and Chickasaw Nations Claims Settlement 
        Act

    Summary: H.R. 3534 would ratify a settlement of the 
Cherokee, Choctaw, and Chickasaw Nations' claims to certain 
lands along the Arkansas River. Under the bill, the tribes 
would extinguish their claims upon payment by the federal 
government of $49 million to compensate them for the 
mismanagement of tribal resources along the Arkansas River. CBO 
estimates that implementing the bill would cost $49 million in 
fiscal year 2003, assuming appropriation of the authorized 
amount. H.R. 3534 would not affect direct spending or receipts; 
therefore, pay-as-you-go procedures would not apply.
    H.R. 3534 contains an intergovernmental mandate as defined 
in the Unfunded Mandates Reform Act (UMRA), but this mandate 
would impose no net costs on state, local, or tribal 
governments. The mandate would fall on the Cherokee, Choctaw, 
and Chickasaw Indian Tribes.
    H.R. 3534 contains a private-sector mandate, as defined in 
UMRA, on the attorneys representing the Cherokee, Choctaw, and 
Chickasaw Nations in the settlement matter described in the 
bill. CBO estimates that the direct cost of the mandate would 
be well below the annual threshold established by UMRA ($115 
million in 2002, adjusted annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 3534 is shown in the following table. 
This estimate assumes that the bill will be enacted near the 
end of fiscal year 2002 and amounts authorized will be 
appropriated in fiscal year 2003. The costs of this legislation 
fall within budget function 450 (community and regional 
development).

----------------------------------------------------------------------------------------------------------------
        By fiscal year, in millions of dollars--
                                                                                                                                 2003      2004      2005      2006      2007
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Authorization level \1\.......................................        49         0         0         0         0
Estimated outlays.............................................        49         0         0         0         0
----------------------------------------------------------------------------------------------------------------
\1\ This amount could be partly or fully offset by a reduction in future payments from the Judgment Fund if the
  tribes prevail in a pending case against the government, however, CBO cannot estimate the likelihood or
  magnitude of such an offset.

    Basis of estimate: H.R. 3534 would authorize the Department 
of the Interior (DOI) to make payments to the tribes' attorneys 
and to three new tribal trust funds to compensate the Cherokee, 
Choctaw, and Chickasaw Nations' for the mismanagement of tribal 
resources along the Arkansas River. The bill would authorize 
the appropriation of $49 million for such payments. Of this 
total, $41 million would be used to settle the tribes' claims, 
and $8 million would be a rental payment for the use of tribal 
land where two federal hydropower facilities are located.
    The trust funds would become the tribes' property after 
each tribe files for dismissal of all relevant claims filed in 
the United States Court of Federal Claims. Therefore, assuming 
that the $49 million authorized by the bill is appropriated in 
2003 and that the tribes file for dismissal in 2003, outlays of 
that amount would be recorded in that year.
    The amounts deposited into the trust funds could be used by 
the tribes to pay for the acquisition of additional land or for 
certain other purposes. The bill would authorize DOI to take 
land acquired by the tribes into trust. CBO estimates that any 
administrative costs to the federal government resulting from 
taking those lands into trust would not be significant.
    Pay-as-you-go considerations: None.
    Estimated impact on state, local, and tribal governments: 
H.R. 3534 contains an intergovernmental mandate as defined in 
UMRA because it would extinguish outstanding legal claims of 
the Cherokee, Choctaw, and Chickasaw Nations. The bill 
provides, however, that these claims would be extinguished only 
after funds are appropriated to compensate the tribes, so they 
would incur no net costs as a result of this mandate.
    Estimated impact on the private sector: H.R. 3534 contains 
a private-sector mandate as defined by UMRA. The bill would 
limit the fees payable to the attorneys under contract with the 
Cherokee, Choctaw, and Chicawaw Nations. Section 7 would limit 
attorneys' fees to 10 percent of the funds allocated by the 
government to each of the Indian Nations. Such a limitation on 
attorney fees would be a private-sector mandate as defined by 
UMRA. The total amount of the settlement is less than $50 
million. Thus, the direct cost of the mandate, measured as a 
loss in net income for the attorneys, would be well below the 
annual threshold established by UMRA ($115 million in 2002, 
adjusted annually for inflation). According to government 
sources, however, attorney fees would likely not exceed 10 
percent of the settlement. Thus, the mandate may have no cost 
to the private sector.
    Estimate prepared by: Federal Costs: Lanette J. Walker; 
impact on state, local and tribal governments: Marjorie Miller; 
impact on the private sector: Cecil McPherson.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                    COMPLIANCE WITH PUBLIC LAW 104-4

    This bill contains no unfunded mandates as defined by 
Public Law 104-4.

                PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

    This bill is not intended to preempt any State, local or 
tribal law.

                        CHANGES IN EXISTING LAW

    If enacted, this bill would make no changes in existing 
law.

                                
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