Land Buy Back Program - 7.16.14

STATEMENT OF

MICHAEL L. CONNOR

DEPUTY SECRETARY OF THE INTERIOR

UNITED STATES DEPARTMENT OF THE INTERIOR

BEFORE THE

UNITED STATES SENATE COMMITTEE ON INDIAN AFFAIRS

ON

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

July 16, 2014

I. Introduction

Good afternoon, Chairman Tester, Vice-Chair Barrasso, and Members of the Committee. Thank you for the opportunity to provide the Department of the Interior's (Department) statement at this oversight hearing on “Improving the Trust System.”

In 2010, Congress enacted historic legislation to bring to a close the Cobell litigation. After decades of contentious litigation that affected virtually every aspect of the Department's relationship with tribes, the legislation opened a new chapter by providing, among other things, a $1.9 billion Trust Land Consolidation Fund (Fund) to restore fractionated lands to tribal trust ownership. This $1.9 billion fund helps to reverse the impacts of the repudiated allotment and assimilation policy. That destructive policy resulted in the loss of approximately 90 million acres of tribal lands in less than 50 years. Although Congress repudiated that policy 80 years ago, its impact on nearly every aspect of tribal life – whether it be law enforcement, economic development or day-to-day governance – continues to be felt every day in tribal communities.

The magnitude of fractionation is enormous. There are over 2.9 million trust or restricted fractional interests spread across more than 150 reservations that are owned by more than 243,000 individuals. Approximately 90 percent of the fractional interests are located within 40 reservations. The Pine Ridge Reservation alone accounts for over 8 percent of the purchasable fractional interests.

The Land Buy-Back Program for Tribal Nations (Buy-Back Program) is one tool that helps alleviate the impacts of fractionation.

Through purchases from willing sellers, the Buy-Back Program is transferring trust and restricted interests directly to tribes so that tribes can utilize the land. Thus far, the Buy-Back Program has transferred the equivalent of more than 203,000 acres of land to tribes. In the short term, much of the money paid to obtain the interests may be spent in these tribal communities. In the long-term, transferring millions of acres of land to tribes is aimed at strengthening each tribal community and generating economic and generational benefits to those communities. Tribal acquisition of fractionated lands “unlocks” those lands, making them available to support economic development to benefit tribal members. Moreover, as sales occur, the Buy-Back Program contributes part of the Fund (up to $60 million) to the Cobell Education Scholarship Fund managed by the American Indian College Fund. This funding will help open doors and create opportunities for current and future generations of Native college students; contributions to the scholarship fund so far exceed $3 million dollars.

II. Implementationof the Buy-Back Program

The Cobell Settlement became final on November 24, 2012, following the exhaustion of appeals through the U.S. Supreme Court. Less than a month following final approval, the Department established the Buy-Back Program and published an Initial Implementation Plan. The Department engaged in government-to-government consultation on the Plan – with consultations in Minneapolis (January 2013); Rapid City (February 2013); Seattle (February 2013) and held numerous meetings with tribes and inter-tribal organizations. With the benefit of significant tribal input and involvement, the Program published an Updated Implementation Plan in November 2013.

In recognition of the complexity and importance of the Buy-Back Program, it was established in the Office of the Secretary with a Program Manager reporting to me. The Department also established an Oversight Board, chaired by me. The Oversight Board, which includes the Solicitor, the Assistant Secretary-Indian Affairs, the Director of the Bureau of Indian Affairs, and the Special Trustee for American Indians, provides regular oversight and guidance for the Program.

The Settlement's unique attributes and ten-year time frame distinguish the Buy-Back Program from many other Federal programs that have an indefinite lifespan. The parameters in the Settlement necessitate quick and expedient implementation at each location to maximize the number of locations and landowners that may participate in the Program.

We are working diligently to implement the Program at many locations. As of July 15, 2014, we have:

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

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

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

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

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

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

o Outreach - $3.2 million;

o Land Research - $2.2 million;

o Valuation - $1.6 million; and

o Acquisition - $6.8 million (includes offer processing capacity for future years);

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

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

× Expanded our Trust Beneficiary Call Center to answer questions, update owner contact information, and register “willing sellers;”

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

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

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

× Created and published cooperative agreement guidance and application templates;

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

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

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

III. Tribal Involvement

Tribal leadership and involvement are crucial to the success of the Buy-Back Program. Secretary Jewell (and before her Secretary Salazar) strongly supports tribal involvement in carrying out the Program. In December 2012, with the release of our Initial Implementation Plan, the Department emphasized that it “hopes to enter into cooperative agreements with many tribes and take advantage of tribes' ability to minimize administrative costs and improve overall effectiveness and efficiency of the Buy-Back Program.” In 2013, the Program sought to update its strategy to expand tribal engagement, and Secretary Jewell stated that the Department's “productive working relationship with tribes and our commitment to landowner outreach will continue to be major driving forces of the Program.” The Assistant Secretary-Indian Affairs and I recently led a listening session in Portland, Oregon, to hear directly from landowners and tribes about their ideas and perspectives on the Program and our progress thus far.

The Program has communicated directly withnearly 80 tribes (28 with jurisdiction over the most fractionated reservations), including meetings with several on or near their reservations. We heard from Indian Country that all fractionated locations should have the opportunity to participate, not simply the locations with 90 percent of fractionated lands. As a result, the Program has pursued opportunities to include less fractionated locations in early implementation efforts, which will help us develop a comprehensive strategy for the purchase of fractional interests at as many less fractionated locations as possible.

We recognized that the Department cannot develop an implementation schedule without input from tribes. To expand tribal involvement, we held an open solicitation period from November 2013 to March 2014, requesting expressions of interest from the tribes exercising jurisdiction over the most fractionated reservations. As a result, nearly sixty tribes submitted a cooperative agreement application or letter of interest to the Program. The open solicitation facilitates increased tribal input on the timing and sequencing of Program implementation. The Department relied on this tribal interest along with other factors, such as degree of ownership overlap, geographic diversity, and appraisal complexity, to guide implementation of the Buy-Back Program. In May 2014, we announced a schedule through 2015 for the continued implementation of the Buy-Back Program that identifies 21 locations representing nearly half of all the fractional interests and half of all owners across Indian Country. The Department continues to implement the Buy-Back Program in a flexible manner and update its approach to reflect lessons-learned, best practices, and tribal involvement.

To date, the Department has entered into cooperative agreements or other understandings, totaling over $4.8 million, with 12 tribeslocated in the Great Plains, Rocky Mountain, Northwest, and Western regions:

o Assiniboine and Sioux Tribes of the Fort Peck Reservation;

o Coeur D'Alene Tribe of the Coeur D'Alene Reservation;

o Confederated Salish and Kootenai Tribes of the Flathead Reservation;

o Confederated Tribes of the Umatilla Indian Reservation;

o Crow Tribe of Montana of the Crow Indian Reservation;

o Fort Belknap Indian Community of the Fort Belknap Reservation of Montana;

o Gila River Indian Community of the Gila River Indian Reservation;

o Makah Indian Tribe of the Makah Indian Reservation;

o Northern Cheyenne Tribe of the Northern Cheyenne Indian Reservation;

o Oglala Sioux Tribe of the Pine Ridge Reservation;

o Sisseton-Wahpeton Oyate of the Lake Traverse Reservation;

o Standing Rock Sioux Tribe

These agreements support the involvement of more than 49 full-time employees that are or will be employed directly by the tribes. More cooperative agreements will be announced soon.

All 12 tribes with cooperative agreements or other arrangements are conducting outreach activities because tribal leadership is critical in assisting landowners to make informed and timely decisions about purchase offers. Tribes are assisting with this critical task by using methods best suited to the needs of their communities. They are updating landowner contact information, notifying landowners of upcoming purchase offers, identifying willing sellers, and hosting various community outreach events. Four tribes are conducting significant land research to prepare the necessary information about the fractionated land to assist with determining the fair market value of the lands. Tribes have made helpful contributions related to this task, including mapping activities, provision of information about land use, collection of comparable sales information, and assistance with minerals evaluation. Three tribes are also conducting appraisals of tracts prioritized by the tribes for acquisition; they are actively working with the Department to finalize their products, which will serve as the basis for purchase offers to landowners.

In sum, each agreement is the product of information sharing and thoughtful discussions between a tribal government and the Department, resulting in a tailored approach for the specific needs of the tribal community. Although the Department is willing to run the Program without a formal tribal cooperative agreement, the Department will continue to pursue cooperative agreements with many tribes to implement the Buy-Back Program through a federal-tribal partnership, which will promote tribal ownership of the Program, minimize administrative costs, and improve overall effectiveness and efficiency.

IV. Land Buy-Back Outreach Efforts

It is a priority for the Department to work with tribal leaders to ensure that Indian landowners are aware of the Buy-Back Program, understand the opportunity to sell their fractional interests for the benefit of their tribal community, and have the assistance they need to make informed decisions and complete the process if they choose to sell. Effective outreach helps to advertise the Program, stimulate land use planning, identify willing sellers, locate owners whose whereabouts are unknown, address questions, and determine tribal priorities regarding what type of fractionated tracts tribes wish to have purchased. Tribal leaders and staff have a prominent role in explaining the Program, and their involvement is actively and financially supported through cooperative agreements.

We have expanded our national outreach given that landowners on the Pine Ridge Reservation resided in all 50 states as well as Canada, Germany, England, Italy, Qatar, Taiwan and the Philippines. Outreach has occurred at on-reservation and regional events across the country. Program staff regularly attends national and regional tribal events to meet with landowners and distribute informational materials. Outreach also includes key leadership from the Secretary's staff. As previously mentioned, I recently hosted a Listening Session in Portland, Oregon to share information and hear directly from Indian Country.

Public service announcements from Departmental and tribal leaders have been disseminated to tribal and local radio stations, and aired in partnership with the Indian Health Service. Each landowner receives a minimum of two postcards for each offer and materials and information are regularly updated on our website, which also includes an online Outreach Toolkit to help tribal staff and organizations communicate about the Program. We are constantly seeking ways to incorporate feedback and improve the Buy-Back Program.

To communicate widely, we have issued nearly 30 press releases, including op-eds published throughout Indian Country. Each announcement is distributed not only to the media, but also to each of the 150 tribes eligible to participate in the Program as well as nearly 100 tribal organizations to help disseminate news (such as the Indian Land Tenure Foundation and National Congress of American Indians). We have received coverage in more than 200 articles, including nearly 90 news outlets including the Associated Press, Indian Country Today, IndianZ, Native American Times, and Rapid City Journal. The Program has purchased advertisements in programs for national events, such as Gathering of Nations, and publication special editions, including Indian Country Today. Most recently, the Program placed advertisements in the Native Sun News, Lakota Country Times, Todd County Tribune, Mellette County News, and Bennett County Booster to highlight opportunities for Pine Ridge and Rosebud landowners.

V. Conclusion

The level of interest expressed by tribes over the past year demonstrates the importance of the Buy-Back Program and our collective desire for it to be successful. Transferring millions of acres directly into tribes' ownership will provide countless opportunities for this and future generations. Restoring tribal homelands is one of our highest priorities and these interests are almost entirely within existing Indian reservations. We appreciate the Committee's interest in the Buy-Back Program and look forward to answering any questions.