[Survey Report on Management of Agricultural Leases by the Colorado River Indian Tribes Under Self-Determination Contract No. 1450CTH51T60325]
[From the U.S. Government Printing Office, www.gpo.gov]

Report No. 97-I-1100

Title: Survey Report on Management of Agricultural Leases by the
       Colorado River Indian Tribes Under Self-Determination Contract
       No. 1450CTH51T60325

Date: August 22, 1997

                  **********DISCLAIMER**********

This file contains an ASCII representation of an OIG report.  No attempt has been made to display
graphic images or illustrations.  Some tables may be included, but may not resemble those in the
printed version.

A printed copy of this report may be obtained by referring to the PDF file or by calling the Office
of Inspector General, Division of Acquisition and Management Operations at (202) 208-4599.
                  ******************************

United States Department of the Interior
OFFICE OF INSPECTOR GENERAL
Washington, D.C. 20240

MEMORANDUM

TO:

FROM:

SUBJECT SUMMARY:     Final Survey Report for Your Information - "Management of
                    Agricultural Leases by the Colorado River Indian Tribes
                    Under Self-Determination Contract No. 1450CTH51T60325"
                    (No.  97-I-1100)

Attached for your information is a copy of the subject final survey report. The objective
of the survey was to determine whether the Colorado River Indian Tribes managed
agricultural leases for individual Indian landowners on the Colorado River Indian
Reservation in accordance with contract, Code of Federal Regulations (25 CFR 162), and
lease requirements.

We concluded that the Tribes effectively managed agricultural leasing on the reservation.
Specifically, they: (1) identified lands that were suitable for agriculture; (2) ensured that
lands available for leasing were known to prospective lessees; (3) initiated actions in a
timely manner to ensure that expiring leases were reissued without a loss of revenue to the
landowners; (4) ensured that fair annual rentals were realized (based on appraisal value
and advertisement for bids) for the leased lands; (5) required direct rental payments to
individual allottee landowners and assignees by the lessees; (6) assessed interest when
rentals were paid late; (7) took appropriate actions to cancel leases when warranted by the
circumstances; and (8) enforced bonding requirements stipulated in the leases. We based
these conclusions on our audit test of 32 randomly selected active leases and 12 leases that
expired on December 31, 1996. The report did not contain any recommendations.

We commended the Colorado River Indian Tribes for their management of the agricultural
leasing program and appreciate the assistance of Bureau staff at the Phoenix Area Office
and the Colorado River Agency Office, as well as Tribal personnel, in the conduct of this
survey.

If you have any questions concerning this matter, please contact me at (202) 208-5745 or
Mr. Robert J. Williams, Assistant Inspector General for Audits, at (202) 208-4252.

Attachment


C-IN-BIA-002-97(B)

United States Department of the Interior
OFFICE OF INSPECTOR GENERAL
Washington, D.C. 20240

SURVEY REPORT

Memorandum

To:

From:

Subject:  Survey Report on Management of Agricultural Leases by the Colorado River
Indian Tribes Under Self-Determination Contract No. 1450CTH51T60325
(No. 97-I-1100)

INTRODUCTION

This report presents the results of our survey of agricultural leases managed by the Colorado
River Indian Tribes under the Bureau of Indian Affairs self-determination Contract No.
1450CTH51T60325. The objective of the survey was to determine whether the Tribes
managed agricultural leases for individual Indian landowners on the Colorado River Indian
Reservation in accordance with contract, Code of Federal Regulations (25 CFR 162), and
lease requirements.

BACKGROUND

The Colorado River Indian Tribes consist of four tribes: Mojave, Chemehuevi, Hopi, and
Navajo. The Tribes have a membership of approximately 3,100, which includes about 1,800
members that reside on a reservation near Parker, Arizona. The reservation comprises about
270,000 acres of tribal and allotted lands, of which approximately 85,000 acres are leased
for agricultural purposes.

In 1990, the Tribes assumed responsibility for the real estate services program from the
Bureau of Indian Affairs Colorado River Agency under an Indian self-determination contract
for real estate services and natural resources programs. A follow-on contract was awarded
on September 15,1994, and was effective from that date through December 31, 1996, at a
total cost of $471,261. Under the terms of the contract, the Tribes assumed all functions and
technical aspects of the Bureau's real estate services program, which includes acquisition and
disposal of land, surface and subsurface leasing and permitting, rights-of-way administration,
trespass enforcement, litigation, and contractual compliance. A February 8, 1997, resolution
of the Tribes specified that they planned to contract for real estate services through 1999 but
had not submitted a proposal at the time of our review in April 1997.

As of December 31, 1996, there were 421 active agricultural leases on the reservation, with
annual rents for these leases totaling $8.1 million.

SCOPE OF SURVEY

Our survey was conducted in accordance with the "Government Auditing Standards," issued
by the Comptroller General of the United States. Accordingly, we included such tests of
records and other auditing procedures that were considered necessary under the
circumstances. We concentrated our review on leasing activities that occurred during 1996.
Survey work was performed at the offrces of the Colorado River Agency and the Colorado
River Indian Tribes, both in Parker, Arizona. Our survey did not include a review of :
(1) costs incurred by the Tribes under the latest contract because such costs are included in
the audits performed in accordance with the Single Audit Act of 1984 or (2) the natural
resources programs because those programs were outside the scope of the survey.

We also reviewed the Secretary's Annual Statement and Report to the President and the
Congress, which is required by the Federal Managers' Financial Integrity Act, for fiscal year
1995 and determined that there were no reported weaknesses related to the objective and
scope of our survey.

PRIOR AUDIT COVERAGE

Neither the Office of Inspector General nor the General Accounting Office has issued a
report in the past 5 years on agricultural leasing by the Tribes.

RESULTS OF SURVEY

We concluded that the Colorado River Indian Tribes effectively managed agricultural leasing
on the reservation. Specifically, the Tribes: (1) identified lands that were suitable for
agriculture; (2) ensured that lands available for leasing were known to prospective lessees;
(3) initiated actions in a timely manner to ensure that expiring leases were reissued without
a loss of revenue to the landowners; (4) ensured that fair annual rentals were realized (based
on appraisal value and advertisement for bids) for the leased lands; (5) required direct rental
payments to individual allottee landowners and assignees by the lessees; (6) assessed interest
when rentals were paid late; (7) took appropriate actions to cancel leases when warranted by
the circumstances; and (8) enforced bonding requirements stipulated in the leases. We based
these conclusions on our audit test of 32 randomly selected active leases and 12 leases that
expired on December 31, 1996.

2

Since this report does not contain any recommendations, a response is not required.

The legislation, as amended, creating the Office of Inspector General requires semiannual
reporting to the Congress on all audit reports issued, actions taken to implement audit
recommendations, and identification of each significant recommendation on which corrective
action has not been taken.

We commend the Colorado River Indian Tribes for their management of the agricultural
leasing program and appreciate the assistance of Bureau staff at the Phoenix Area Office and
the Colorado River Agency Offke, as well as Tribal personnel, in the conduct of this survey.

cc: Tribal Council Chairman, Colorado River Indian Tribes

3