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Senate approves bill to streamline Indian energy development

Friday, December 11, 2015

A coalbed methane drilling well on the Southern Ute Reservation in Colorado. Photo from Southern Ute Indian Tribe Department of Energy

The Senate approved a bill aimed at spurring energy development in Indian Country on Thursday.

S.209, the Indian Tribal Energy Development and Self-Determination Act Amendments, passed the chamber by unanimous consent, a sign of its non-controversial nature. The bill has bipartisan support and includes provisions that have been embraced by tribes with experience in the energy industry.

“One of the best ways to facilitate economic opportunities in Indian Country is to give tribes more control over the development of their natural resources,” Sen. John Barrasso (R-Wyoming), the chairman of the Senate Indian Affairs Committee, said in a press release. “This bill helps tribes by streamlining Washington’s slow approval process and cutting red tape. It will help create good-paying jobs across Indian Country while increasing our nation’s energy security."

“Tribes should be in control of their energy resources,” added Sen. Jon Tester (D-Montana), the committee's vice chairman. “This bipartisan bill increases self-determination and allows tribes to build a sustainable energy plan that will create good-paying jobs and a more stable economy.”

Indianz.Com SoundCloud: Senate Indian Affairs Committee Oversight Hearing on “The GAO Report on ‘INDIAN ENERGY DEVELOPMENT: Poor Management by BIA Has Hindered Development on Indian Lands.’"

Barrasso introduced the measure in January after a prior version failed to advance in the last session of Congress. The committee approved the bill at a business meeting on February 4 and heard from energy-developing tribes at an oversight hearing on October 21.

"The Southern Ute Indian Tribe is a great example of the positive impacts of Indian energy development," James “Mike” Olguin, a council member for the Southern Ute Tribe of Colorado, said in his written statement. "Less than fifty years ago the tribal council had to end the practice of distributing per capita payments to tribal members because the tribe could not afford them. Today the tribe provides health insurance for its tribal members, promises all members a college education, and has a campus dotted with state-of-the art buildings."

At the hearing, Olguin complained about the lack of expertise at the Bureau of Indian Affairs in handling energy projects. S.209 aims to address that issue by reducing delays associated with the approval of leases, business agreements, and rights-of-way in Indian Country.

The delays can contribute to economic woes on reservations where jobs and development are scarce. The Rosebud Sioux Tribe of South Dakota found that out when it waited 18 months for the BIA to approve a lease for the 30-megawatt Owl Feather War Bonnet wind farm.

A photo simulation of the Owl Feather War Bonnet wind farm on the Rosebud Sioux Reservation in South Dakota. Image from Rosebud Sioux Tribal Utility Commission

"According to the developer of the project, the review time caused the project to be delayed and resulted in the project losing an interconnection agreement with the local utility," the Government Accountability Office said in a June 2015 report. "Without this agreement, the project has not been able to move forward, resulting in a loss of revenue for the tribe."

The tribe is still committed to the project, though, and is re-negotiating the agreements, High Country News reported in July.

The delays can also be costly. The Southern Ute Tribe told the GAO that it lost out on $95 million because it took the BIA eight years to review rights-of-way agreements for a natural gas pipeline.

In addition to addressing red tape, S.209 aims to improve the Energy Policy Act of 2005. The law -- which was passed by a Republican-controlled Congress -- authorized the BIA to approve tribal energy resource agreements, or TERAs, in order to streamline energy development.

However, no one has ever taken advantage of the law even though it was touted as a step toward greater self-determination.

A drilling well in Indian Country. Photo from Bureau of Indian Affairs

"We don't have a single TERA that's been signed and that means something has gone wrong," Assistant Secretary Kevin Washburn, who is leaving the BIA on January 1, told the committee at a hearing in May 2014.

Officials from one tribe told the GAO that something indeed is wrong. They cited uncertainty with the TERA regulations regarding which activities they can take over from the BIA. They also were worried about the agency's "complex" application and review process, the report said.

"According to the tribal officials, without additional guidance on inherently federal functions, tribes considering a TERA do not know what activities the tribe would be assuming or what efforts may be necessary to build the capacity needed to assume those activities," the GAO reported.

Barrasso's bill is the first to address the issue and he's urging the House to take up his measure. That chamber, however, has taken a somewhat different approach with the passage of H.R.538, the Native American Energy Act.

H.R.538 also aims to streamline energy development on tribal lands but it contains provisions that have drawn objections from the White House Office of Management and Budget. A statement of administration policy cited problems with the bill's treatment of fracking, leasing, appraisals and public comment in Indian Country.

The Southern Ute Tribe and the Navajo Nation, however, are among those in Indian Country who are supporting H.R.538. The bill has not been taken up the Senate and its provisions differ significantly from S.209.