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S. HRG. 111–430 

INDIAN ENERGY AND ENERGY EFFICIENCY 

HEARING 

BEFORE THE

COMMITTEE ON INDIAN AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

OCTOBER 22, 2009 

Printed for the use of the Committee on Indian Affairs 

( 

(II) 

COMMITTEE ON INDIAN AFFAIRS 

BYRON L. DORGAN, North Dakota, Chairman 

JOHN BARRASSO, Wyoming, Vice Chairman 

DANIEL K. INOUYE, Hawaii 

KENT CONRAD, North Dakota 

DANIEL K. AKAKA, Hawaii 

TIM JOHNSON, South Dakota 

MARIA CANTWELL, Washington 

JON TESTER, Montana 

TOM UDALL, New Mexico 

AL FRANKEN, Minnesota 

JOHN MCCAIN, Arizona 

LISA MURKOWSKI, Alaska 

TOM COBURN, M.D., Oklahoma 

MIKE CRAPO, Idaho 

MIKE JOHANNS, Nebraska 

ALLISON C. BINNEY, Majority Staff Director and Chief Counsel 

DAVID A. MULLON JR., Minority Staff Director and Chief Counsel 

(III) 

C O N T E N T S 

Page 

Hearing held on October 22, 2009 .......................................................................... 1 

Statement of Senator Barrasso ............................................................................... 2 

Statement of Senator Cantwell .............................................................................. 3 

Statement of Senator Dorgan ................................................................................. 1 

Statement of Senator Franken ............................................................................... 7 

Statement of Senator Johanns ............................................................................... 6 

Statement of Senator Murkowski ........................................................................... 4 

Prepared statement .......................................................................................... 5 

Statement of Senator Udall .................................................................................... 6 

WITNESSES

Gray, Hon. James Roan , Chairman, Indian Country Renewable Energy Consortium Board of Directors; Chairman, Osage Nation ...................................... 29 

Prepared statement .......................................................................................... 31 

Herrera, Hon. Steve, Tribal Council Member, Southern Ute Indian Tribe; 

accompanied by Tom Shipps, Legal Advisor ...................................................... 37 

Prepared statement .......................................................................................... 39 

Levings, Hon. Marcus, Chairman, Three Affiliated Tribes of the Fort Berthold 

Reservation; Secretary, Council of Energy Resource Tribes (CERT) ............... 8 

Prepared statement .......................................................................................... 10 

Sampson, Jr., Hon. Ralph, Chairman, Yakama Nation ....................................... 41 

Prepared statement .......................................................................................... 43 

(1) 

INDIAN ENERGY AND ENERGY EFFICIENCY 

THURSDAY, OCTOBER 22, 2009 

U.S. SENATE, COMMITTEE ON INDIAN AFFAIRS, Washington, DC. 

The Committee met, pursuant to notice, at 2:15 p.m. in room 

628, Dirksen Senate Office Building, Hon. Byron L. Dorgan, 

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. BYRON L. DORGAN, 

U.S. SENATOR FROM NORTH DAKOTA 

The CHAIRMAN. Let me thank my colleagues for dispensing of 

those two items of business. And let me say, as we begin this process once again, this Committee is not going to be in the business 

of trying to recognize what is an Indian tribe or who belongs to an 

Indian tribe or who doesn’t, or who should we recognize as a tribe. 

That is not something I think we should routinely do. These two 

cases I think were unique. 

And now I will close the business meeting formally, and we will 

open the hearing. Let me describe, if I might, the purpose of the 

hearing today. 

This hearing is about Indian Energy and Indian Energy Efficiency. Today’s hearing follows up on an Indian energy hearing 

that we held on May 1st, 2008. And at that hearing, the Committee 

received testimony on the obstacles that Indian tribes face in developing energy resources. We are now focused on trying to find solutions to those problems. Following the May 1st hearing, the Committee met with tribes from across Indian Country on energy 

issues, worked with the Administration to try to improve implementation of Indian programs, and now we are holding this hearing today. 

Vice President Barrasso—excuse me, Vice Chairman—— 

[Laughter.] 

The CHAIRMAN. I want to elevate my colleague here. 

Vice Chairman Barrasso and I released an Indian Energy and 

Energy Efficiency concept paper. We also announced a series of Indian energy roundtables to discuss the concept paper. Our staff 

have conducted eight roundtables throughout Indian Country. We 

have done that because we believe consultation is the hallmark of 

this Committee in our work with the tribal governments around 

the Country. 

The energy roundtables were designed to engage Indian leaders, 

tribal members and their energy partners to discuss the concept 

2 

paper. This hearing is another step. The concept paper identified 

three major obstacles: number one, antiquated laws and cumbersome regulations; number two, the lack of tribal access to the 

transmission grid; and number three, the lack of available financing and incentives for investment for Indian tribal energy projects. 

As I said before, there is substantial energy available on Indian 

lands across this Country. Too little of it is being developed because there are cumbersome procedures and all kinds of roadblocks. We want to find a way to unlock the opportunity. Nowhere 

in this Country is there a greater need for the jobs that will come 

from substantial and robust economic development from these energy resources. 

And yet, what we have discovered is, in our experience working 

with the Three Affiliated Tribes’ Reservation in North Dakota, a 

49-step process. You want to get a permit to drill an oil well on an 

Indian reservation, it is going to take you much, much, much, 

much longer than if you want to get a permit to drill anywhere else 

in my State. And I have shown the map previously of this circumstance. The circumstance has changed for the better, but that 

map shows all those little areas where wells have been dug, and 

that middle part is the Indian reservation. You will see there is 

much, much more activity north and south and west and much less 

activity on the Indian reservation. 

Why? Because there is less oil on the reservation? No, not at all. 

It is much harder to drill there, because you have to go through 

a long process with the Interior Department, I believe four separate agencies in the Interior Department, to get a permit to drill 

for oil. 

It ought to be as easy to get a permit to drill for oil on that Indian reservation as it is to the west of it, the north of it and the 

south of it. That is what we need to fix. Now, Chairman Levings 

is one of the witnesses today, and he very much, for his tribe, 

wants robust development, just as all of his neighbors do around 

him. That was almost blank at the first part of this year on the 

Indian reservation. We are making a little progress. But there is 

much more to do. 

So let me say to my colleague, Senator Barrasso, I think the 

paper that we have put out, it is a working paper, it has been a 

good start. I look forward to the witnesses today at this hearing to 

talk about their view of this and what we should do to proceed to 

move forward. 

Senator Barrasso, do you want to comment? 

STATEMENT OF HON. JOHN BARRASSO, 

U.S. SENATOR FROM WYOMING 

Senator BARRASSO. I would like to do that, Mr. Chairman, and 

I want to thank you for holding this very important hearing on one 

of really this Committee’s highest priorities. Earlier this year, I 

met with the Joint Business Council of the Eastern Shoshone and 

Northern Arapaho Tribes in Fort Washakee, Wyoming. Tribal leaders emphasized to me and to our staff, our combined staff, how important energy development is to the economy of the Wind River 

Indian Reservation. 

3 

Wyoming, as is North Dakota, is very blessed with abundant resources, including energy resources, that this Country desperately 

needs. This Committee can address key issues that will improve 

the Northern Arapaho and the Eastern Shoshone Tribes’ ability to 

develop their energy resources, just as you are dealing with in 

North Dakota and in places around the Country. 

This will be win-win situation, improving economic development 

on the reservation and supplying important resources, Mr. Chairman, to the Nation. As you know, at this Committee’s Indian energy round tables, tribes and individuals have made it clear that 

increasing Indian energy development is critical to improving the 

economies on our reservations. 

During the roundtables, the subject of NEPA paperwork was discussed again and again. I am referring, of course, to the National 

Environmental Policy Act. It is my understanding that Congress 

intended NEPA to apply to decisions relating to use on Federal 

public lands. Since then, Federal courts have interpreted NEPA to 

apply to decisions by the Secretary regarding Indian lands. We 

have been hearing that NEPA impacts the tribes’ goals to develop 

their trust resources, including their energy resources. 

So it is my hope, Mr. Chairman, as it is yours, that we can address this, that we can address those many impediments that you 

have mentioned that prevents development on Indian lands. With 

that said, I want to thank our witnesses for being here. Many have 

traveled long distances. I look forward to the hearing today. 

The CHAIRMAN. Senator Barrasso, thank you very much. 

I want to recognize other Senators for brief comments. Senator 

Cantwell? 

STATEMENT OF HON. MARIA CANTWELL, 

U.S. SENATOR FROM WASHINGTON 

Senator CANTWELL. Thank you, Mr. Chairman. Thank you for 

calling this important hearing today. 

It is important that Indian Country be part of the debate on the 

need for a greener energy economy. I appreciate your efforts to construct an Indian energy bill that will maximize the efforts of tribes 

across our Country. 

I would also like to thank Chairman Ralph Sampson of the 

Yakama Nation for traveling all the way to Washington to give testimony here today. I would like to thank the rest of the witnesses. 

The Yakama Nation Reservation covers 1.3 million aces and contains numerous possible sources for renewable energy. The tribe is 

exploring biomass, wind, hydro resources and considering the potential for various renewable energy projects. The nation has recently started its own public utility district, and in order to produce 

and sell power to the reservation, making this work for the 

Yakama Nation. 

Indian Country has the potential to provide a huge amount of renewable resources. That potential needs to be tapped. At least 77 

reservations have the potential for wind energy production, and 

many others utilize biomass and solar. Nationally, 14 percent of Indian households on reservations have no access to electricity. This 

clearly must change. 

4 

These renewable resources hold the potential to both raise the 

living standards and the quality of life for those Indian households 

currently without access to electricity and also to contribute to our 

broader national energy and climate policies. The development of 

renewable resources holds the key, I believe, to a green economy 

and sources of millions of jobs for Americans. I commend Chairman 

Sampson and the Yakama Nation for their leadership and foresight 

on this issue. I look forward to hearing his testimony and that of 

the other witnesses, and working with you, Mr. Chairman, on moving legislation from this Committee. 

Thank you. 

The CHAIRMAN. Thank you very much. 

Senator Murkowski? 

STATEMENT OF HON. LISA MURKOWSKI, 

U.S. SENATOR FROM ALASKA 

Senator MURKOWSKI. Thank you, Mr. Chairman. I appreciate the 

opportunity to say a few comments today and for your leadership 

and yours, Senator Barrasso, on this issue. When we passed the 

Energy Policy Act back in 2005, I think we were all happy that it 

contained the provision in it that it did, Title V, which created the 

offices within Department of Interior and Energy that was designed to help Natives and energy development. The provisions 

that authorized up to $2 billion in loan guarantees for both fossil 

and renewable energy development on Native lands, these were for 

reservations both on the lower 48 and Alaska Native Corporation 

lands up in Alaska. 

But I have been disappointed in how the Act has been implemented thus far. While Interior does have an Indian Energy and 

Economic Development Office, the Office hasn’t encouraged tribes 

to enter into mineral leases and other energy development agreements. At Energy, the Office of Indian Energy Policy was established, but then wasn’t funded for a period of years. While the Office did provide a few grants, DOE still has not implemented its 

Indian Loan Guaranty program. 

We recognize, I think, that the aid to Indians and Natives nationwide to help them develop the likely, very huge energy resources that are on their land, whether it is oil or gas or coal, oil 

shale, you have the wind, solar, geothermal, it is just about everything can be very helpful. But the aid that has been made available 

has been not only underwhelming but almost non-existent. I certainly appreciate and support the efforts to try to remedy the deficiencies that we have discovered since that Energy Act in 2005, 

whether we do it as a standalone bill or as part of additions to an 

energy bill that has already been considered by the Energy Committee and is waiting consideration by the Floor. 

There are some things that you have laid forth, Mr. Chairman, 

in the paper that you have put forth. I support many of them, such 

as the issue of transmitting siting, making sure that our tribes 

have more ability to influence these transmission siting decisions 

across the reservations. Many of the other provisions I certainly 

support. 

I do want to make sure that the provisions extend aid to Natives 

and their Native corporation representatives in Alaska. I think 

5 

that should be easy to accomplish and we want to work with you 

on that. 

I have more extended comments that I want to include in the 

record. I probably won’t be able to stay for the whole hearing, because I am heading off to our largest convention of Alaska Natives, 

which is being held tomorrow morning. So if you see me leave 

early, it is not because of lack of interest in this subject. We want 

to work with you and support you. 

Thank you, Mr. Chairman. 

[The prepared statement of Senator Murkowski follows:] 

PREPARED STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM ALASKA

In 2005 when we worked to pass the Energy Policy Act, I believe we were both 

happy that the bill contain in Title V, provisions that created offices inside the Departments of Interior and Energy intended to help Natives in energy development 

on Native lands—reservations in the Lower 48 and on Alaska Native corporation 

lands in Alaska. 

I have been very disappointed with how the Act has been implemented so far. 

While Interior does not have an Indian Energy and Economic Development Office, 

the Office has not really encouraged tribes to enter into mineral leases and other 

energy development agreements. 

At Energy, the Office of Indian Energy Policy was established, but not funded for 

several years. While the office did provide a few grants this past year, DoE still has 

not implemented its Indian loan guarantee program. 

The aid to Indians and Natives nationwide to help them develop the likely huge 

energy resources on their lands: oil, gas, coal, and oil share, and wind, solar, geothermal, biomass and in some cases hydro, has been not only underwhelming, but 

almost non-existent. 

I certainly support your efforts to try to remedy the deficiencies discovered since 

2005, either in a standalone bill or as part of additions to an energy bill that has 

already been reported by the Energy Committee and is still awaiting floor consideration. 

There are few complexities. Given that we have already moved in Energy to separate part of the loan guarantee programs from DoE and give them a new Clean Energy Development Administration, it is hard to know how exactly to mesh these 

changes until we see if CEDA is going to pass, or if the loan program is going to 

remain at DoE. 

I personally would like to see more grant aid available for energy development 

on reservation and Native corporation lands. I agree that generating capital to finance and build energy projects is often hard on Indian lands since the tax incentives we generally provide to the private sector for energy development don’t translate well in Indian Country and in Alaska. 

Obviously finding the money to pay for those grants is the big program, since a 

template for the grants was approved in 2007 in the Energy Independence and Security Act when we created the Renewable Energy Deployment Grant program. We 

just haven’t funded it, either through appropriations or in last winter’s stimulus bill, 

or returned it to its intended national focus. Maybe the Renewable Electricity 

Standard that is pending approval in the energy bill may help slightly. But I don’t 

think it will be the full answer. 

I strongly support giving Indian tribes more abilities to influence transmission 

siting decisions across reservations. And I support many of the other suggestions 

in your’ and Senator Barrasso’s concept paper this summer. I do want to make sure 

that the provisions extend such aid to Natives and their Native corporation representatives in Alaska, but that should be easy to accomplish. I also want to make 

sure they do not create logistic problems for Indian allotees in the Lower 48 given 

the terms of the existing Indian Mineral Development Act. 

I thank the Chairman and the Vice Chairman for your hard work on these issues. 

I will leave early to catch a flight to Alaska to address the annual Alaska Federation of Natives, our largest gathering of Alaska Natives. So if you see me leave 

early, it is not because of a lack of interest in this subject. I look forward to working 

with you on these important issues. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you very much. 

Senator Udall? 

6 

STATEMENT OF HON. TOM UDALL, 

U.S. SENATOR FROM NEW MEXICO 

Senator UDALL. Thank you very much, Mr. Chairman, and 

thanks for holding this important hearing. 

Tribal lands comprise approximately 5 percent of the Nation’s 

land base and contain 10 percent of the Nation’s energy resources. 

They also provide tremendous promise to help the United States 

meet its renewable energy goals. According to DOE, tribal wind potential can provide 20 percent of the installed electric power that 

was generated in the United States in 2004. Tribal solar energy potential can provide 4.5 times the installed electric power that was 

generated in the United States in 2004. 

In addition, the land of Indian tribes contain tremendous 

amounts of sustainable biomass material. But really, the point here 

is tribes need the assistance to do this and to move forward with 

development. We made an attempt, as Senator Murkowski has 

said, in Title V of the 2005 Energy Bill. But what we have done 

has been inadequate. A title was established at the Department of 

Interior and Department of Energy to assist tribes in energy development, but the mandate has only been partially implemented. 

DOI set up an Office of Indian Energy and Economic Development 

to provide technical assistance and loan guaranties to tribes. The 

loan guaranty program is greatly under-funded. The Department of 

Energy set up an Office of Indian Energy Policy and Programs to 

assist tribes, but the office was not funded for two years, and has 

only had a director with no staff. 

Also, none of the Recovery Act money was dedicated to these 

types of tribal projects. So we need to do better by the tribes in 

terms of assisting them with the development of their energy resources. 

Thank you, Mr. Chairman. I yield back. 

The CHAIRMAN. Senator Udall, thank you. 

Senator Johanns? 

STATEMENT OF HON. MIKE JOHANNS, 

U.S. SENATOR FROM NEBRASKA 

Senator JOHANNS. Mr. Chairman, thank you very much. Let me 

just say, as that map was displayed, I think that tells the story. 

Obviously, something is not working here in a rather magnificent 

way. You have all of this development all around the Indian reservation, and yet there on the reservation, the development does 

not occur. 

Bottom line is, we want development to occur. The tribes want 

development to occur. We are in agreement on that. I think we are 

also in agreement that it has to be the whole host of possibilities, 

not just drilling for fossil fuels, wind and solar, and maybe nuclear, 

a whole host of opportunities exist if we can somehow figure out 

the right combination here. 

I must admit, I am becoming more and more convinced that it 

really is all about implementation and how we somehow overcome 

the roadblocks that exist, whether they are financial, whether they 

are just part of the culture of the process that you have to go 

through. So my hope is today that as you testify, and I thank the 

witnesses for being here, that maybe you give us a little bit of inVerDate Nov 24 2008 11:11 May 24, 2010 Jkt 056321 PO 00000 Frm 00010 Fmt 6633 Sfmt 6601 S:\DOCS\56321.TXT JACK PsN: JACKF
7 

sight on where are those speed bumps, where are the absolute 

roadblocks, where is it impossible to move forward, and see if there 

is something that we can do in a legislative way that will help with 

that implementation problem. 

Let me just wrap up and say to the Chairman and the Ranking 

Member, I really do appreciate their leadership in bringing this forward. I think this is such a key economic opportunity. Those who 

know my background know that I am not a fan of gambling. It is 

too dependent on the economy. When things are going well, there 

is a financial stream there. When things aren’t going well from an 

economic standpoint, people lose their jobs. They are out of work. 

At a time when they most need that employment, that employment 

is in jeopardy. 

So I am hoping that this is an opportunity for us to try to improve economic circumstances on our reservations across the Country. Thank you. 

The CHAIRMAN. Thank you very much. 

The Senator from Minnesota? 

STATEMENT OF HON. AL FRANKEN, 

U.S. SENATOR FROM MINNESOTA 

Senator FRANKEN. Thank you, Mr. Chairman, thank you, Vice 

Chair Barrasso, for holding this very important hearing. 

I want to thank the witnesses for coming, and I want to apologize. I have to leave in 10 minutes for a meeting on health care. 

Back at home, a number of our tribes have been implementing 

advanced energy strategies. I want to thank the Chairman, who 

has been very supportive of these initiatives in his other roles as 

Chairman of Energy and Water Appropriations, of that subcommittee. One example can be found on the White Earth Reservation. The White Earth Tribe has developed a local alternative energy initiative. They have worked out agreements with some of our 

rural electric cooperatives and farmers in the region. The result is 

a 20 kilowatt wind turbine at Waubun, Minnesota, and they have 

plans to expand production and feed energy into the grid. 

Part of White Earth’s integrated strategy includes reducing energy consumption through conservation and distributive energy 

projects. They have also started a solar training program on the 

reservation to train members in the use of solar power installations 

in their homes. 

But this isn’t just isolated in Minnesota to the White Earth 

Tribe. Across Minnesota, tribes are working with local municipalities to develop regional as well as tribal energy plans. I am sure 

the folks at White Earth and other Minnesota tribes would love to 

highlight their work and provide useful insights like you, maybe at 

a roundtable in Minnesota. But that is why we are here today, to 

figure out ways to assist tribes in developing and producing their 

own energy. This is critical for so many reasons. A few weeks ago 

I attended a tribal summit in Shakopee, Minnesota. Over 23 tribes 

came together to discuss ways in which Indian Country can finally 

realize self-determination. Most of the summit focused on ways to 

rebuild what attendees referred to as the infrastructure of nationhood. I think that is a very apt phrase, the infrastructure of nationVerDate Nov 24 2008 11:11 May 24, 2010 Jkt 056321 PO 00000 Frm 00011 Fmt 6633 Sfmt 6601 S:\DOCS\56321.TXT JACK PsN: JACKF
8 

hood. I think we can all agree that energy is one of the primary 

ingredients of infrastructure. 

I look forward to hearing from the panelists. My staff will remain 

here and take notes. I hope to get back from this meeting. We look 

forward to hearing from you on how we can best promote tribal energy and how we can best remove barriers to the development of 

that energy. 

In particular, I am interested in the panel’s view on how to 

tweak our current energy laws to encourage more sustainable energy production, increase access to transmission lines, help tribes 

gain access to financing for clean energy projects. I look forward to 

working with both the Chair and the Vice Chair on this important 

legislation, and thank you again for calling the hearing, and thank 

you for your testimony. 

The CHAIRMAN. Thank you very much. 

We have four witnesses today. We appreciate your patience and 

appreciate very much your being here. 

The first is the Honorable Marcus Levings, who is the Chairman 

of the Three Affiliated Tribes in North Dakota. He is also Secretary 

of the Council of Energy Resource Tribes Executive Board. The 

Council of Energy Resource Tribes was founded in 1975. They participated in the development of tribal provisions on the Indian Mineral Development Act of 1982 and the Energy Policy Act of 2005 

and the Energy Independence and Security Act of 2007. 

Chairman Levings has been deeply involved in energy production 

and a wide range of energy issues. He is a real leader on these 

issues and I appreciate his coming to Washington today. I was with 

Chairman Levings on Saturday on his reservation, where we did a 

groundbreaking for a health clinic that was promised to the tribe 

60 years ago, when the Elbow Woods Hospital was submerged underwater as a result of the dams that were placed on the Missouri 

River. The Elbow Woods Hospital was gone, it was underwater. 

And it was promised that it would be replaced. Sixty years later, 

we had a groundbreaking for what will be a wonderful health care 

clinic. That is thanks to Chairman Levings’ insistence and determination. 

Mr. Chairman, thank you for being here. You may proceed. 

STATEMENT OF HON. MARCUS LEVINGS, CHAIRMAN, THREE 

AFFILIATED TRIBES OF THE FORT BERTHOLD 

RESERVATION; SECRETARY, COUNCIL OF ENERGY 

RESOURCE TRIBES (CERT) 

Mr. LEVINGS. Good afternoon, Chairman Dorgan, Vice Chairman 

Barrasso and members of the Committee on Indian Affairs. My 

name is Marcus Dominick Levings. My Hidatsa name is eh-BahDah-Gish, White Headed Eagle. I am the elected tribal chairman 

of the Three Affiliated Tribes of the Fort Berthold Indian Reservation in North Dakota, with 11,000 duly enrolled members. 

In June of 2009, I was elected Secretary of the Council of Energy 

Resource Tribes on behalf of the Three Affiliated Tribes and 57 

member Indian tribes. I am pleased to submit for the Committee’s 

consideration the following statement regarding energy development, environmental stewardship and job creation in Indian Country. 

9 

Today’s hearing follows the May 2008 hearing entitled Indian 

Energy Development and no fewer than eight Indian energy roundtable to solicit the views and comments of Indian tribes on the committee’s Indian energy concepts paper, formally issued in September. American Indian energy resources hold enormous potential 

to create tens of thousands of jobs, good-paying jobs, generate substantial revenue for the tribal owners and aid in development of 

tribal economies. The Three Affiliated Tribes and our mineral 

allottees reside on what is commonly known as the Bakken Shale 

clay. This mineral play has the potential to contribute vast 

amounts of crude oil and natural gas to the national economy, and 

will vastly improve the economic and quality of life to our enrolled 

members who have historically been one of the poorest populations 

in the state of North Dakota. 

American Indian tribes in the lower 48 States, especially those 

in the Rocky Mountain West, own an enormous amount of energy 

resources. In addition to enormous amounts of non-renewable resources, primarily oil, natural gas, coal and coal-bed methane, Indian tribes have a significant development potential in renewable 

sources of energy, such as wind, solar, hydro, biomass, geothermal 

and others. 

In September 2009, CERT submitted to the Committee its views 

and analysis of the May 2009 Indian Energy Concepts paper. Attached to this statement is a copy of those views and analysis. I 

would like to share a few of the issues that the Three Affiliated 

Tribes have with regard to the Indian Energy Concepts paper. In 

the interest of time, I will focus on just three of these issues. 

First, the Three Affiliated Tribes have actively engaged our Federal energy industry partners to expedite the leasing and permitting practices that have thus far stymied efforts to fully develop the 

energy resources of the Fort Berthold Reservation. We are extremely grateful to Chairman Dorgan, along with Senator Conrad 

and Congressman Pomeroy, who have been instrumental in installing the virtual One Stop Shop to consolidate the current 49-step 

process it takes to develop mineral resources on Indian lands. 

We have begun to see the benefits of this process. The regulatory 

and administrative burden upon mineral development on Fort 

Berthold caused considerable economic harm, as tribe and mineral 

allottees were unable to benefit fully from the period of high crude 

prices that we experienced not more than 12 months ago. 

While we are grateful for the assistance of the Indian Affairs 

Committee, it is also imperative that such fixes to the leasing and 

permitting process on Indian lands also include all agencies that 

have a duty to the Indian trust beneficiaries. It is not just the Bureau of Indian Affairs that has a trust responsibility to our tribes 

and our enrolled members, but the entire Federal Government. 

The Bureau of Land Management, the Environmental Protection 

Agency and others should also be placed in the one-stop shops, as 

they have a vital and important role in the development of trust 

minerals. It is not just t ability to drill an oil and gas well that is 

at issue, as Indian Country is subject to an enormous body of law 

and regulation that make it very difficult to develop without effective and timely interagency communication and cooperation. 

NEPA, the Clean Air Act, the Clean Water Act and other laws 

10 

make Indian energy development a costly and time-consuming endeavor that serves as the principal deterrent for much of the private industry to enter Indian Country. 

Second, the lack of suitable infrastructure in Indian Country also 

has a tremendous negative impact on the ability to develop all our 

energy resources: oil, gas and renewable energy resources. The lack 

of suitable roads, electrical transmission lines and oil and gas gathering systems and pipelines creates an enormous economic barrier 

to our development. 

It is imperative that the tribes, Congress and industry look to 

cost-effective solutions to allow the level of development that can 

only improve our overall natural energy resources. Too often, we 

have been forgotten when this Country’s infrastructure is improved 

through existing Federal funding and are only encountered when 

Indian Country has a resource to offer the rest of the Nation. We 

are respectfully asking and reminding this Committee that Indian 

energy development must include as a base the improvement of the 

infrastructure in Indian Country that is so often taken for granted 

in the rest of the United States. 

Finally, I would like to address the issue of adequate staffing in 

all agencies that have a role in development of Indian energy in Indian Country. It is too often the occurrence in Federal agencies 

that take a lead role, i.e., the Bureau of Indian Affairs, to recruit, 

hire and promote individuals who do not have the education and/ 

or experience in the area of energy development, particularly in the 

highly specialized area of Indian Country. Many of the bureaucratic delays and legal entanglements are caused by individuals 

who could not even fill a similar position in private industry. Yet 

we are forced to work with those individuals as the principal 

agents of our Federal trustee. 

Often, our tribal members encounter those same individuals in 

training sessions where, given their title and responsibilities, 

should in fact be teaching the same courses. We cannot and should 

not be subject to the standard Federal merry-go-round where current and former Federal employees are merely promoted or transferred to important positions where their decisions impact the economic futures of Indian tribes and our allottees. 

The Federal Government should have the same employment 

standards as the very industry which they are hired to regulate 

upon. The fiduciary duty of the Federal Government as our trustee 

demands no less. 

Mr. Chairman, that concludes my prepared statement, and I 

again thank you for the opportunity to present the views of CERT. 

I would be happy to answer any questions you may have. [Phrase 

in native tongue.] 

[The prepared statement of Mr. Levings follows:] 

PREPARED STATEMENT OF HON. MARCUS LEVINGS, CHAIRMAN, THREE AFFILIATED

TRIBES OF THE FORT BERTHOLD RESERVATION; SECRETARY, COUNCIL OF ENERGY

RESOURCE TRIBES (CERT) 

Good afternoon Chairman Dorgan, Vice Chairman Barrasso, and members of the 

Committee on Indian Affairs. Before addressing the issues of Indian Energy and Energy Efficiency, I want to thank you for your strong leadership in helping Indian 

tribes and their members meet the many challenges they face including health care, 

law enforcement, unemployment, and others. 

11 

1The EPAct of 2005 (Pub.L. 109–58) and the EISA 2007 (Pub.L. 110–240) both contain provisions favorable to Indian tribal energy development and environmental management. 

Background on the Council of Energy Resource Tribes 

I am Marcus Levings, Chairman of the Three Affiliated Tribes of the Fort 

Berthold Reservation in North Dakota. In June 2009 I was elected Secretary of the 

Council of Energy Resource Tribes (CERT). On behalf of the 57 member Indian 

tribes of CERT, I am pleased to submit for the Committee’s consideration the following statement regarding energy development, environmental stewardship, and 

job creation in Indian Country. 

CERT was founded in 1975 by tribal leaders when our country was in the midst 

of what was then known as the ‘‘Arab Oil Embargo,’’ put in place by the Organization of Petroleum Exporting Countries in response to America’s support for Israel 

in the 1973 Arab-Israeli War. The embargo caused higher prices for heating oil and 

gas and contributed to the economic recession that lasted for the ensuing 7 years. 

Back then, our national leaders promised that we would ‘‘end our dependence on 

foreign oil’’ and return America to a position of unquestioned strength in the world. 

Nearly, 35 years later our dependence on foreign sources of energy has never been 

greater. 

The core mission of CERT is to support member tribes enhance their management 

capabilities and prudent development of their energy resources to build sustainable 

economies and strong political institutions. 

The Historic Role of the Committee in Energy Legislation 

For many years, the Committee on Indian Affairs has recognized the important 

economic role of renewable and non-renewable energy resource development in Indian country. 

Beginning in 1999, the Committee worked with the Indian Tribal Energy Network 

in conceptualizing and drafting what became the Indian Tribal Energy Development 

and Self-Determination Act of 2005. This comprehensive Indian energy law was included in the massive Energy Policy Act of 2005. 

This was followed by the Committee’s key role in fashioning Indian provisions in 

the Energy Independence and Security Act of 2007, as well as important Indian 

amendments that were included in energy legislation considered earlier this year by 

the Senate Energy and Natural Resources Committee. 1

Today’s hearing follows the May 2008 hearing entitled ‘‘Indian Energy Development,’’ and no fewer than 8 Indian Energy Roundtables to solicit the views and comments of Indian tribes on the Committee’s Indian Energy Concepts Paper formally 

issued in September. 

The Economic Importance of Indian Energy Development 

American Indian energy resources hold enormous potential to create tens of thousands of good-paying jobs, generate substantial revenue for the tribal owners, and 

aid in the development of tribal economies. An often-overlooked aspect of Indian energy is that it helps satisfy the American economy’s need for a reliable energy supply. The Southern Ute Indian Tribe in southwest Colorado, for instance, produces 

1 percent of the natural gas that is used by the American people and American business. In less than 20 years, the tribe’s gas operations have evolved to be among the 

most sophisticated in the country and are managed by the various tribally-owned 

energy companies. 

Based on information provided by the U.S. Department of the Interior’s Office of 

Indian Energy and Economic Development (OIEED), in 2007 energy and mineral resources generated over $574 million in royalty revenue paid to individual Indians 

and tribes. Moreover, income from energy and minerals has increased 260 percent 

since 2002. The OIEED expects these trends to continue and so does CERT. 

There are good reasons to be optimistic that Indian tribal energy development will 

continue to expand in other tribal communities. These reasons include the following: 

1. Enormous tribal reserves of oil, gas, coal, wind, solar, geothermal and other 

resources; 

2. The likely long-term pricing environment for energy products; and 

3. The enactment by Congress pro-production energy policies. 

The OIEED estimates that an additional 15 million acres of undeveloped traditional energy mineral resources and over 22 million acres of undeveloped renewable 

energy resources exist on individual Indian and tribal lands. If these estimates are 

correct, additional billions of dollars in revenue would likely be generated to the individual and tribal owners. 

12 

More specifically, the OIEED’s analysis finds that the potential remaining resources to be realized through new development on Indian lands reveal the following: 

Commodity Potential Resource 

Oil 5.3 billion bbls 

Gas 25 billion mcf 

Coal 53.7 billion tons 

Coalbed Methane 12.7 million mcf 

Wind energy 535 billion kWh/year 

Solar energy 17,600 billion kWh/year 

Woody biomas 3 billion kWh/year 

Hydroelectric 5.7 million kWh/year 

Geothermal 21 million kWh/year 

One merely witness the phenomenal success of the Southern Ute Indian Tribe, 

the Ute Tribe of the Uintah and Ouray Reservation in northeast Utah, and the 

Osage Nation in eastern Oklahoma to understand that American Indian energy resources, developed properly, can transform Indian economies and assist tribes in 

achieving real and lasting self-determination. 

Tribal Energy Resources and the Pricing Environment 

American Indian tribes in the lower 48 states—especially those in the Rocky 

Mountain West—own an enormous amount of energy resources. With the current 

Federal restrictions on exploring for energy in the Great Lakes, the eastern portion 

of the Gulf of Mexico, the California coastline, and the Alaska National Wildlife Refuge (ANWR), Indian tribal resources and lands in the Rocky Mountain West present 

one of the most significant opportunities for domestic production in the United 

States. 

In what is now a dated analysis, in 2001 the U.S. Department of the Interior 

(DoI) estimated the total dollar value of energy produced from Indian tribal lands 

for the period 1934–2001 to be $34 billion. These revenues derived from 743 million 

tons of coal, 6.5 billion cubic feet of natural gas, and 1.6 million barrels of oil. In 

terms of undeveloped reserves and undiscovered resources, the DoI projected that 

Indian tribal lands could prospectively generate $875 billion, derived from 53 billion 

tons of coal, 37 billion cubic feet of natural gas, and 5.3 million barrels of oil. 

These projections were made in 2001 and in the intervening 8 years, the price of 

energy products has increased significantly. Present-day revenue projections would 

be nearly $1.5 trillion. 

Enactment of New Energy Laws in 2005 and 2007 

On August 8, 2005, President Bush signed into law the Energy Policy Act of 2005 

(Pub.L. 109–58) which included as title V the Indian Tribal Energy Development 

and Self-Determination Act. The new law authorizes a variety of Federal technical 

and financial assistance to participating Indian tribes and seeks to reduce administrative obstacles at the Federal level to encourage greater levels of energy development on tribal lands. 

This tribal energy law does not discriminate in terms of favoring renewable over 

non-renewable resources or vice versa. Instead, the law leaves the development decisions to the tribal owner and the market. 

Similarly, in 2007, Congress enacted and the President signed the Energy Independence and Security Act (‘‘EISA’’, Pub.L. 110–140) which contains significant opportunities for Indian tribes and tribal colleges to receive research, development, 

and production grants related to renewable and alternative energy development. 

The Act authorizes tens of billions of dollars for these purposes and represents the 

most significant energy research law to be enacted in years. 

The American Recovery and Reinvestment Act of 2009 

In February 2009, President Obama signed into law the American Recovery and 

Reinvestment Act (ARRA). The ARRA included $16.8 billion for ‘‘Energy Efficiency 

and Renewable Energy,’’ a broad category that includes $3.2 billion for Energy Efficiency and Conservation Block Grants. The ARRA also provided $5 billion for the 

Weatherization Assistance Program, and $4.5 billion for Electricity Delivery and Energy Reliability. This latter program is related to expenses necessary to electricity 

delivery and energy reliability of the energy infrastructure energy storage research 

and development, demonstration and deployment, and facility recovery. In addition, 

$100 million is allocated for ‘‘worker training.’’ 

13 

The ARRA also provided $6 billion for the Innovative Technology Loan Guarantee 

Program. 

These funds are crucial because, in addition to enormous amounts of non-renewable resources, primarily oil, natural gas, coal, and coal bed methane, Indian tribes 

have significant development potential in renewable sources of energy such as wind, 

solar, hydro, biomass, geothermal, and others. 

Reliable information suggests that the vast majority of potential renewable energy 

projects in Native communities are modest in size and more akin to the community 

development scale than the commercial utility scale. As a result, most of these 

projects might only require an environmental assessment and not a full-blown environmental impact statement under the National Environmental Policy Act (NEPA). 

More often than not, these projects require Federal support to fund the construction 

costs in order for them to proceed to construction. 

Proposal for a ‘‘National Tribal Energy Efficiency Initiative’’ 

With the support of this Committee and the congressional appropriators, a ‘‘National Tribal Energy Efficiency Initiative’’ would (1) generate an enormous number 

jobs in the short-run and long-run; (2) be reasonable in terms of cost; (3) have superior environmental impacts in Indian country; and (4) produce greater economic benefits for virtually every Indian tribe and have the greatest impact on the tribes with 

the largest number of poor and working poor families. 

The initiative CERT has in mind would be something along the lines of a ‘‘National Tribal Energy Efficiency Initiative’’ that could fund virtually every Indian 

tribe. The initiative would be massive but, if properly structured, would maximize 

the use of local labor and local Indian contractors. 

In addition to home weatherization, the initiative could include all tribal government buildings and Federal facilities located on tribal lands. The high cost of heating and cooling because of poorly-constructed and poorly-insulated buildings 

equipped with highly inefficient lighting and H–VAC systems erodes program budgets, reduces services and produces environments that are not healthy for workers 

or for people who use access the facilities. It would dramatically reduce the operating and maintenance costs for health clinics, hospitals, schools and tribal colleges, 

tribal administrative buildings, and other structures on tribal lands. 

The initiative would also have an immediate impact on the utility bills for heating 

for the most vulnerable Indian populations in the Northern tier of the country from 

the Pacific Northwest to Maine, the Tribes of the Four Corners Area, and the poor 

families of the Oklahoma Indian Tribes. And for the desert southwest Tribes, their 

weather related issues come in the summer months. Regardless of their geography, 

all of the Tribes have vulnerable populations: the elderly, infants and the disabled. 

In a relatively short period of years, the initiative would transform Indian Country from among the most energy inefficient to among the more energy efficient and 

would lead to better health, more efficient programs and more competitive tribal 

economies. The energy savings could be measured in real dollars because the good 

thing about energy efficiency is that the savings are not one-time occurrences but 

accrue year after year. Even a massive Federal expenditure in an initiative of this 

type would be repaid in savings in 3 to 5 years, and would continue for another 10 

to 20 years, depending on building maintenance. 

For this initiative to succeed, the funding would need to be administered through 

an agency that is able to direct the money very quickly to each interested Indian 

Tribe. One way to expedite the funding process would be to convene regional ‘‘preapplication workshops’’ so interested and eligible Indian tribes could respond appropriately to the agency distributing the funding. If the funds were routed through 

the Administration for Native Americans (ANA) in the Department of Health and 

Human Services, that agency would do a superb job of fund distribution with minimal red-tape because it has a demonstrated ability to move money very quickly into 

tribal programs. The ANA has a network of regional and national technical assistance contractors already in place to provide the workshops and hands-on technical 

assistance to ensure every interested and eligible Indian Tribe has the best chance 

to access the program. 

In addition to CERT, there are other national Indian organizations that could be 

of assistance in mobilizing Indian contractors and the local pool of Indian labor such 

as the National Council on Tribal Employment Rights (NCTERO) which has a national network of local TERO offices that have data on the local workforce and the 

relationship with labor unions for training and apprenticeship programs, as well as 

data on local, Indian-owned companies. The National Center for American Indian 

Enterprise Development (NCAIED) has an excellent network of larger Indian and 

tribal construction companies as well as a network of major private sector compaVerDate Nov 24 2008 11:11 May 24, 2010 Jkt 056321 PO 00000 Frm 00017 Fmt 6633 Sfmt 6621 S:\DOCS\56321.TXT JACK PsN: JACKF
14 

nies, such as Home Depot, that might be included in such an initiative to supply 

the material needed for these activities. 

Indian Energy Project Development 

The new energy laws were signed into law in 2005 and 2007 and the regulations 

to implement them are now in effect. For the past five fiscal years, the Congress 

has appropriated funds for the Department of Interior’s Office of Indian Energy and 

Economic Development and the Department of Energy’s Office of Indian Policy and 

Programs, both of which are charged with administering the new laws. 

Nonetheless, and as the Committee has identified in its Indian Energy Concepts 

Paper, many challenges to more vigorous energy development remain. 

Responses to the Committee’s Indian Energy Concepts Paper 

In September 2009, CERT submitted to the Committee its views and analysis of 

the May 2009 Indian Energy Concepts Paper. Attached to this statement is a copy 

of those views and analysis. 

Conclusion 

Mr. Chairman, that concludes my prepared statement and I again thank you for 

the opportunity to present the views of CERT. I would be happy to answer any 

questions you may have. 

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The CHAIRMAN. Chairman Levings, thank you very much. We appreciate your being here. 

Next, we will hear from the Honorable James Roan Gray. He’s 

the Chairman of the Indian Country Renewable Energy Consortium Board of Directors and Chairman of the Osage Nation. 

Mr. Roan Gray, we appreciate your coming to town to testify. 


1022a14.eps
29 

STATEMENT OF HON. JAMES ROAN GRAY, CHAIRMAN, INDIAN 

COUNTRY RENEWABLE ENERGY CONSORTIUM BOARD OF 

DIRECTORS; CHAIRMAN, OSAGE NATION 

Mr. GRAY. Good afternoon, Chairman Dorgan, Vice Chairman 

Barrasso, members of the Committee. I am Jim Gray, of the Osage 

Nation, Principal Chief. I would like to thank you for inviting me 

to present as Chairman of the Indian Country Renewable Energy 

Consortium today. 

Chairman Dorgan, I want to express special thanks to you and 

the Committee for the willingness to play a critical leadership role 

in developing a comprehensive concept paper setting forth important proposals to achieving our central, shared objective, making 

sure that we set an effective foundation for tribes and Native corporations to participated on a level playing field in this emerging 

green economy. 

The Consortium has presented more detailed written remarks, 

and I respectfully request they be made part of the hearing record. 

The CHAIRMAN. Without objection. 

Mr. GRAY. Just generally speaking, I would just like to make 

some basic observations. I think the first is that unlocking the renewable energy potential throughout Indian Country is essential, 

and it is something that is not new. It is something that has been 

discussed for many years. Experts agree that somewhere between 

10 to 15 percent of the wind potential resources are on Indian 

lands. And that percentage is doubled for solar. 

It is simply not possible, as the Administration recognizes, for 

the Nation to achieve our renewable energy goals that the President has laid out without the serious development of those resources in Indian Country. This is a sober reality. 

Second, there is a hunger for Indian Country to develop the renewable resources because it is consistent with our traditional values. 

Third, there are presently impediments to effective and prompt 

development of renewable energy resources on tribal lands. As a result, tribes are severely disadvantaged through really no fault of 

their own. The Consortium’s principal goal is to even the playing 

field, so that those opportunities can be laid out working within 

their own structure or with private industry. 

Fourth, the Consortium recognizes that renewable energy development is a generational opportunity. We understand that, as I am 

sure you will agree, renewable energy development is no ordinary 

opportunity, but one that comes along every generation or so. It 

can be part of a solution to the grinding poverty that still exists 

on many tribal communities. 

Fifth, now is the time to act. The energy provisions in the energy 

legislation will set a foundation for renewable energy development 

for at least the next few decades. If tribes are not effectively included, we will be locked out of this important generational opportunity. 

There are solutions and impediments for development of renewable resources in Indian Country. The proposals of the Consortium 

are detailed in our written submission, but I should review a few. 

Finally, ICREC is not asking for special perks or treatment for 

tribes. Quite the opposite is true. Essentially what we want to do 

30 

is to streamline the policies so that the opportunities are consistent 

with what’s going on as you demonstrated so effectively with your 

map. So our policy priorities in our written testimony will delineate 

a long list of proposals. We will not reiterate those here, but I 

would like to reiterate a few that we believe are key. 

First is streamlining. The streamlining process at Interior and 

Energy, presently there are long delays in the federal approval and 

permitting process that make investments in tribal projects less attractive. It takes two to four years longer to build wind or solar resources in Indian Country because of the many bureaucratic steps 

that have to be taken. Development in Indian Country will greatly 

suffer. If we do not streamline the processes, we will not unlock 

this extraordinary potential. 

And the Consortium fully supports your one-stop shop idea. As 

other tribes have indicated to you throughout the Country, the 

Three Affiliated Tribes is not unique in the sense that there are 

many bureaucratic steps that often delay development on Indian 

lands. So there needs to be a process to create a NEPA policy that 

is not a hindrance but more of a tool and a shield to protect those 

resources on tribal lands, as well as to not to hinder development. 

It is past time for Interior to provide a specific checklist for approval of right-of-way for leases. 

Transmission. Inadequate transmission infrastructure and capacity on Indian lands, in addition to difficult access to transmission 

on and from Indian lands, is a huge obstacle. Even with the development of wind and solar power, without effective transmission capacity, those projects will stay on the Reservation, never to be a 

part of the grid. Further, permitting WAPA and BPA to give tribes 

priority in queuing is fair in light of the amount of WAPA and 

transmission lines on Indian lands. 

We could also show a different map, one that shows the transmission grids that go around reservations. The very simple reason 

of the leasing process and the right-of-way process has just made 

it impossible for development to take place without a commitment 

from the United States to see that those transmission lines are effectively put in Indian Country. 

Financing. Current financial incentives are ill-fitting instruments 

in much of Indian Country and thus act as a disincentive for tribes’ 

capital investment in projects on their lands and with their own resources. What makes renewable projects feasible are tax credits, investment tax credits, production tax credits, new market tax credits. But tribes don’t pay the relevant taxes where these issue become relevant. So they cannot use the principal means of the 

incentivized investment. We would like to be able to monetize those 

tax credits in a way that can give tribes a partnering investment 

opportunity throughout Indian Country in these renewable 

projects. 

The final word, administrative changes. We need to fill those positions that are still left open. The Energy Policy Act has not been 

implemented. One example is the Department of Energy’s Office of 

Indian Energy Policy and Programs, was authorized under the 

2005 OEPA. This program was intended, among other things, to 

permit far greater interagency coordination to facilitate tribal access in DOE programs. But it was not implemented carefully or it 

31 

wasn’t completely implemented at all. Actually, we do need to fill 

those positions that are still open. But the Administration has 

taken no action on the OEPA in nine months, no director, and it 

languishes in Intergovernmental Affairs, where it has no oversight 

of policies or programs. 

In conclusion, renewable energy represents an unrivaled opportunity to break the cycle of poverty in many tribal communities. 

But we have to make sure there is a level playing field. Tribes can 

compete with private developers, so long as they are not disadvantaged. The time to act is now. 

I thank you for the opportunity to speak and I would be happy 

to answer any questions. 

[The prepared statement of Mr. Gray follows:] 

PREPARED STATEMENT OF HON. JAMES ROAN GRAY, CHAIRMAN, INDIAN COUNTRY

RENEWABLE ENERGY CONSORTIUM BOARD OF DIRECTORS; CHAIRMAN, OSAGE NATION

Introduction 

Good afternoon, Chairman Dorgan, Vice-Chairman Barrasso and Members of the 

Committee, thank you for inviting me as Chairman of the Indian Country Renewable Energy Consortium (‘‘ICREC’’ or ‘‘Consortium’’) here today to provide testimony 

to the Committee on this most critical of issues—unlocking the extraordinary clean 

energy development potential of Indian Country. I am Chief Jim Gray, I appear before you today as the Chairman of the Consortium. 

I would be remiss Chairman Dorgan if I did not also express my deep gratitude 

to you for taking such a leadership role in developing concepts and a comprehensive 

concept paper setting forth commendable ideas to ensure that Indian Country will 

be included in the emerging green economy. The Consortium views the Concept 

Paper an important starting point. We are encouraged by this Committee’s leadership and foresight in understanding that unlocking the renewable energy potential 

on tribal lands and throughout Native territory is key to meeting the general National objective of energy independence and reducing carbon emissions. 

I want to start today by telling you a little bit about our coalition. ICREC is a 

not-for-profit entity established this year. Our Consortium has combined the extraordinary expertise of Indian Country and its allies along with a geographicallydiverse group of tribal governments and tribal and Alaska Native Corporations, all 

of whom have a great interest in and are actively pursuing various aspects of renewable energy development. The Consortium is a unified voice and seeks to ensure 

that Indian Country will have a seat at the policy-making table in this extraordinary generational opportunity. The Consortium recognizes the hurdles that have 

inhibited development of our renewable resources to date. These impediments will 

continue to impede if unaddressed. But, taking great advantage of the enormous expertise and dedication from people throughout Indian Country, the Consortium has 

worked hard to find effective solutions—ways to overcome the impediments before 

us. 

Chairman Dorgan, Consortium members understand the gravity of this present 

endeavor. We understand, as I’m sure you will agree, renewable energy development 

is no ordinary opportunity, but one that comes along every generation or so. Working together with your leadership and that of the President, we are confident that 

we can forge policies that will make certain that Indian Country is not left out as 

it has been in times past with other emerging development opportunities. There is 

much at stake in this effort, and the ICREC members are here to say in a loud, 

sober, unified and clear voice, we stand ready to work with you to set the proper 

foundation for this future. 

We are cognizant that the future, if effective policy choices are made, may be 

bright indeed for many tribal communities. There is tremendous potential for renewable energy development in Indian Country. We also know the present reality: 

actual projects have been slow to materialize. This is due to a variety of obstacles 

ranging from overly complex and burdensome lease approval processes to difficult 

transmission access and ill-fitting financial incentives. In light of the national strategic importance of renewable energy resources and the vast undeveloped renewable 

resources in Indian Country, coupled with the potential significant benefits of working with tribal governments, the Consortium has identified a number of policy options that will remove these obstacles. Let us be clear on one critical point at the 

32 

* Because ICREC has focused its efforts at this juncture to support policies and priorities related to primarily commercial renewable and transmission projects, our recommendations also 

primarily reflect potential commercial solutions to the unique and important challenge that face 

Indian Country. 

outset—ICREC is not asking for special perks or treatment. Quite the opposite is 

true. Present policies, for a variety of reasons we will discuss in greater detail 

below, place our members and Indian Country generally in a distinctly disadvantageous position. The policy suggestions the Consortium is advocating are in furtherance of evening the playing field so that Indian Country can fairly compete in this 

emerging clean energy economy. 

Under current law, Indian Country faces primary policy challenges in the renewable energy and infrastructure development in the following broadly defined categories: 

I. LEASING & SITING—Indian lands lease review & approval processes can 

easily take as many as two to three years longer than the comparable processes 

for projects outside of reservations, even in comparison with projects on Federal 

lands; and there is a desperate need to streamline approval processes, clarify 

and coordinate renewable energy development and renewable transmission 

siting and leasing processes on Federal and Indian lands; 

II. TRANSMISSION INFRASTRUCTURE—Inadequate transmission infrastructure and capacity on Indian lands, in addition to difficult access to transmission 

on and from Indian lands, and obstacles to access to public energy grids, 

present significant hurdles to renewable energy development in Indian country; 

III. FINANCING—Current financial incentives are ill-fitting instruments in 

much of Indian Country and thus act as a disincentive to tribes’ capital investment in projects on their own lands and with their own resources; and 

IV. FEDERAL PROGRAMS—Indian energy programs are not effectively structured to support renewable energy deployment in Indian country. 

In greater detail below, we discuss these challenges facing Tribes and Native Corporations in developing, investing in and owning renewable energy projects. * In addition we set forth specific legislative solutions and discuss some of the ideas outlined in the Committee’s Concept Paper. 

I. Leasing and Siting 

CHALLENGES & CONCERNS: It is widely understood that the enhancement of 

the Nation’s renewable energy development, will rely heavily on the private sector. 

Indeed, the vast majority of the proposals being considered are some combination 

of incentivizing the private sector, creating new opportunities for private-public 

partnerships and public dollar investment. 

Attracting private capital, as always, will remain competitive. Development, in 

turn, which can move from concept to actual energy generation most promptly will 

have important competitive advantages. Put another way, in renewable development, as in so many other things, time is indeed money and to attract money, those 

who have built-in delays will be far less competitive. 

Yet, tribal development presently, suffers from many delays not attributable to 

tribes themselves but because of inefficient federal policies and practices. Consequently, these delays must be addressed if tribes are going to compete on an even 

playing field. We understand, of course, renewable projects sited and financed in Indian Country are a new phenomenon. But we also believe it essential that to not 

hamper development, new rules and procedures must be put in place to make 

projects timely, and hence, economically viable. Older leasing rules and paradigms 

which were designed to protect the Indian public and environment from non-renewable energy development are often, in a word, obsolete. Such approaches are not always necessary nor the best-fit for renewable projects. And we are fighting time. 

These two challenges alone suggest we begin to look towards innovative ways to 

stimulate renewable development on Indian lands. 

Investors, developers and Tribes who seek to invest capital on renewable projects 

are finding that the lack of clarity with respect to trust and Indian land lease reviews and permitting, and the often severe delays and extraordinary and unpredictable length of time involved in such federal reviews and the federal issuance of permits, serve as a great disincentive to capital deployment. 

Developer commitments and capital flow along the paths of least resistance. As 

federal agencies and states make it easier to site and permit projects on federal and 

state lands, creating more transparent and predictable processes, it is not surprising 

that capital will be more attracted to those projects and away from Indian projects, 

33 

especially when under current systems, projects can take anywhere from 2–5 years 

longer on tribal and other trust lands. The challenge then is clear—to be competitive, there must be streamlining of the processes and greater transparency. 

Recommendations & Solutions 

A. The One Stop Shop is a concept whose time has come. We fully support the 

Committee’s efforts and the Administration’s establishment of ‘‘one-stop-shops.’’ Specifically, we strongly support creation of a one shop for Tribal renewable energy and 

transmission development and the establishment of clear rules with strict timelines 

so that leasing and permitting can be both predictable and prompt. 

B. Streamline the Appraisal Process and/or allow for third-party appraisals with 

Tribal consent, even if just for renewable and transmission projects to stimulate deployment. 

C. Authorize Long Term and Renewable Transmission Leases. An amendment to 

25 U.S.C. § 415 authorizing 25-year leases with an option to renew for an additional 

25-years for renewable energy projects (projects defined as eligible for tax credits 

under IRS sections 45 and 48) and transmission projects substantially benefiting renewable projects without additional Secretarial approval. 

D. Extend the Allowable Length of Section 17 Corporations Lease Terms. Extend 

current authorization by Tribal corporations chartered under the Indian Reorganization Act Section 17 to lease lands and to extend the current terms of leases up to 

at least 50 years for eligible renewable and renewable transmission projects. 

II. Transmission 

CHALLENGES & CONCERNS: It is no secret that one of the critical challenges 

facing our Nation generally in facilitating the growth of renewable development is 

transmission. It doesn’t really matter how much energy you can generate if you cannot transmit that energy to viable markets. That is as true in Indian Country as 

anywhere. 

Although a significant transmission and federal hydropower footprint run 

throughout Indian Country, ironically, in virtually every instance, tribal renewable 

projects experience great difficulty in securing access to the transmission infrastructure on their lands This presents one of the most significant impediments to Indian 

renewable development—securing connectivity between Tribal renewable energy 

projects and electric markets. Put another way, a necessary precondition to unlock 

the potential for renewable energy development in Indian Country is access to commercial markets. 

Closer and more meaningful national collaborations with Indian Country and the 

Federal Government with respect to access, use and planning for future expansions 

of our critical national transmission system is essential. So far, tribal voices have 

not been adequately included in the national discourse on transmission build-out. 

It is essential that any clean energy statute ensure that tribes are on equal footing 

to states in making the critical transmission infrastructure decisions. 

Recommendations & Solutions 

A. Authorize expansions of federal transmission with specific authorization to 

enter into Power Marketing Administration ‘‘public’’/private/tribal partnerships for 

new lines and expansions of lines within current corridors for the specific purpose 

of rapid deployment of renewable energy on Indian lands. Authorizing both the 

Western Area Power and Bonneville Power Administrators, as they are currently 

authorized, to allow other entities to participate in the financing, construction and 

ownership projects; but with new authority to provide priority to the participation 

of entities which have partial or full ownership by a Tribe, Native corporation or 

tribal enterprise. In addition, specific authorizations to allow tax-exempt bonding 

authority to Tribes as a financing tool to acquire equity and ownership positions in 

said public-private-tribal transmission projects would provide an additional tool to 

address this concern. 

B. Create a Tribal Preference for Transmission Capacity And Queuing For Transmission Projects. Authorize queuing and capacity preference related to FERC-approved new transmission projects, for transmission rights and interconnections for 

Tribal and Alaskan Native renewable projects located in empowerment zones and 

HUB zones in Indian Country or authorize eligibility for any federal incentives by 

virtue of their status as Indian lands. Additionally, direct federal PMAs, as they undertake queue reform including cluster studies and similar assessments through the 

end of 2010, to advance applications for projects sited on Indian lands that have met 

the relevant criteria for interconnection requests. 

34 

III. Financing 

CHALLENGES & CONCERNS: As tax-exempt entities, tribal governments have 

a very limited ability to employ current tax-based credits and other financial incentives for renewable energy development—the primary drivers for renewable investment in the United States. Tribes and native communities often want to own and 

control critical renewable energy infrastructure. However, if they cannot utilize the 

incentive tools of tax credits, ownership is generally not feasible and prohibitive. 

The answer is making the tax credits fungible or tradable otherwise tribes are at 

serious disadvantage and inability to use tax credits will remain a further hindrance 

to renewable project development in Indian Country. 

The rationale behind the series of renewable energy tax incentives enacted over 

the years is fairly clear—to spur new investment in order to drive technology innovation, to incentivize investment into new generation cleaner energy development 

and to take advantage of economies of scale for manufacturing. 

As with many policy objectives, the intended effects and the practical effects are 

not in all cases the same. Tribal governments are keenly aware of their differences 

from other governmental counterparts. Those differences, as these policies were initially contemplated and designed, are not adequately addressed by current policies 

and do not begin to address a rapidly emerging interest and priority for Tribes to 

diversify and invest in (and control) their own renewable energy projects. 

The fundamental challenges for Tribes to compete with other governmental entities not to mention investor counterparts are unfortunately not solved with a single 

fix. Rather, there are targeted approaches that can significantly level the playing 

field in the near term. The complexity of the answers is better understood when understanding the practical effect of the current situation as well as and surveying 

some attempts to ‘fix’ the situation in the past, namely two specific impediments: 

Third-Party Non-Tribal Investment and Ownership of Renewable Projects 

To economically develop a renewable project, efficiently utilizing the investment 

tax credit (or production tax credit or other very important financial incentives) is 

essential. So essential in fact that it is causing most Tribes, looking to develop and 

invest into these projects, to bring on tax partners who can utilize these credits. But 

this is a Catch–22 of sorts for the tribes—they need the partner to take advantage 

of the tax credit, but for an extraordinary long period of time the Tribal governments is, in essence, losing significant control over their own critical infrastructure. 

Under present law, because the tax credits follow the capital investment and ownership on a pro rata basis throughout the term of the tax credits, the ownership and 

control of the project must be in the taxable owner partner. Simply put, Tribes can 

not monetize tax credits efficiently to offset any tax liabilities. This presents a disincentive for Tribes to own a project, much less invest in it, and presents a confounding and exasperating challenge. 

Rather than wait for all of the natural resources to be developed around them, 

Tribes are being faced with the question of whether to (1) wait until the law 

changes so they can control and invest in their own projects, and watch renewable 

development happen without them (and ostensibly saturate the market) or (2) accept third party tax investment, development and ownership—once again taking a 

passive position. Although some are choosing the latter and innovating creative 

compensation strategies to attempt to offset the inequities, it does not change the 

essential fact that third parties once again own critical infrastructure on Indian 

lands. 

Tribal-Specific Hurdles to Issue Clean Renewable Energy Bonds (CREBs) 

The creation and authorization of the Clean Renewable Energy Bonds (CREBs), 

a financial incentive created in the Energy Policy Act of 2005, and its inclusion of 

Tribes as eligible entities was a positive step forward in attempting to level the competitive playing field between consumer-owned utilities and other eligible entities 

(e.g., municipals, electric cooperatives, and Tribal governments) and tax investors 

whose benefits from these provisions is straightforward. The purpose of the CREBs 

program was to provide an incentive specifically for these entities to invest in new 

renewable electricity generation facilities. 

However, there are a few inaccurate assumptions made about Tribes in comparison to other governmental or non-profit entities authorized to issue CREBs which 

make the issuance of CREBs by Tribes for renewable projects very difficult, a fact 

which accounts for the few Tribal applications for the initial allocations. Municipal 

entities and electric cooperatives can effectively make the most of CREBs because 

both have tax-based governmental subsidies and/or rate-based entities, either of 

which can provide the securitizations necessary for pre-project capital flow. Tribes, 

with the exception of very few, do not enjoy the resources to collateralize or fund 

35 

pre-cash flow based on rate-based revenues and almost none have a sufficient tax 

base. Supreme Court cases have exacerbated this lack of Tribal tax base recently 

by allowing states to tax on Indian lands and limiting Tribal taxation of non-Indians 

on reservations. 

In short, while the purpose of this program is commendable and addresses the 

inequities between consumer-owned utilities and private investors, the practical effect on authorized Tribal entities has made this a program that falls short in addressing the fundamental challenges facing Tribal governments. 

Recommendations & Solutions 

A. Require implementation of the DOE Indian Energy Loan Guarantee Program 

($2 billion) which is already authorized by the Energy Policy Act of 2005. And if 

any centralized incentive program is authorized in either statute or by the Secretary, whether it be a green bank or other restructured DOE program, that loan 

guarantee funds be segregated for Indian Country projects and coordinated by the 

DOE Office of Indian Energy Policy and Programs. 

B. Authorize Production Tax Credits (IRS Section 45) to be Assignable. Incentivize 

Tribal and Alaska Native investment via transferability of IRS section 45 production 

tax credits between Tribes (and intertribal energy development entities) and their 

partners within a defined legal relationship. Congresswoman Herseth-Sandlin (SD) 

has introduced as stand-alone version of this request, titled the Fair Allocation of 

Internal Revenue Credit for Renewable Electricity Distribution by Indian Tribes Act 

of 2009 (H.R. 2982). 

C. Authorize Investment Tax Credits (IRS Section 48) to be Assignable. Incentivize 

Tribal and Alaska Native investment via transferability of IRS section 48 investment tax credits between Tribes (and intertribal energy development entities) and 

their partners within a defined legal relationship. 

Or in the alternative, the ICREC recommends the possible inclusion of these assignability authorizations in the section of the Code where these tax credit incentives emanate. IRS Section 38—General Business Credits, be amended by the addition of one subsection as follows: 

D. Proposed new Section 38(e): 

(e) Indian Tribes, and Alaskan Native village governments—An Indian tribe 

and Alaskan Native village government, or qualified intertribal energy development entity, as a lessor of property may elect to treat the lessee of such 

property as having purchased such property for purposes of the credits provided for in Section 45 and Section 48, even if the property would not otherwise be Section 38 property in the hands of such Indian tribe, Alaskan Native 

village or qualified intertribal energy development entity. 

Proposed language addition at end of Section 168(h)(2)(A): 

A Qualified Facility under Section 45 and Energy Property under Section 48 

shall not be characterized as Tax-Exempt Use Property as the result of an 

ownership interest by an Indian tribal government. 

E. Authorize a Permanent Extension of the Indian Wage Credit and Accelerated 

Depreciation Allowance. These have been relatively uncontroversial provisions 

which put in place and reauthorized over the years and are a tremendous 

help in both attracting and optimizing capital to projects in Indian Country. 

Businesses cannot effectively plan with only annual reauthorizations of these 

incentives. 

F. Amend P.L. 98–369 section 60(b)(c) to Allow Loss Transfers by Alaska Native 

Corporations. Incentivize Tribal and Alaska Native Investment via loss transferability between Native Corporations and Tribes and their partners within 

a defined legal relationship. 

G. Reauthorize (a Tribal) Renewable Energy Production Incentives (REPI)—reauthorize the REPI for Tribal Projects for production tax credit (PTC) projects 

in order to provide a non-tax credit financial incentive for renewable energy 

electricity produced and sold by qualified renewable energy generation facilities that can be used in conjunction with New Markets Tax Credits and accelerated depreciation allowances on Indian lands. 

H. Reauthorize Grants-in-Lieu-of-Tax Credits And Authorize Eligibility For 

Tribes. If there is any reauthorization of this program which was established 

in section 1603 of the American Recovery and Reinvestment Tax Act of 2009, 

authorize specific eligibility of Indian Tribes and Alaska Native Corporations 

in this program. 

36 

IV. Federal Programs 

CHALLENGES & CONCERNS: Indian Country renewable energy & transmission 

projects are positioned to be one of the most significant economic and infrastructure 

development opportunities in decades. With Tribal communities economically hamstrung by inadequate infrastructure, no tax base and population growth outpacing 

infrastructure growth—energy and infrastructure development that will not just 

provide new revenue streams but also attract capital investments in manufacturing, 

new sustainable employment and a new hope to tribal communities deserves a dedicated focus and coordination by the agencies that serve Indian Country. 

Many provisions in the Energy Policy Act of 2005 remain not only unfunded but 

inadequately implemented. It is no surprise then that the provision have not served 

the purpose for which Congress enacted them. To support current renewable and 

transmission initiatives in Indian Country requires immediate implementation of 

these statutory provisions. 

One important example to help illustrate the point is The Department of Energy’s 

Office of Indian Energy Policy and Programs (OIEPP). This program was intended, 

among other things, to permit for far greater intra-agency coordination and facilitate tribal access to DOE programs. But the OIEPP Office was implemented woefully. Although authorized by Congress for a $20 million budget, only this year have 

funds been requested. The OIEPP Director in the last Administration directed only 

himself; he had no staff; he had few resources; he oversaw no programs. Indeed, although under the Act he was to have a robust office with oversight of ‘‘policy and 

programs,’’ he has no line authority over any programs. Needless to say, this must 

change. 

The Department of Interior also plays a critical role. Bureau of Indian Affairs’ realty staff will need far greater and more intensive training and support to handle 

the influx of new technology and commercial agreements otherwise this will continue to be a bottleneck and limit renewable project development. 

Recommendations & Solutions 

A. Department of Energy Office of Indian Energy Policy & Programs. We need to 

fill the political position of the Director of OIEPP. The fact that it has not been 

filled, going into our ninth month of this Administration, and we still have not come 

close to filling this position is unacceptable. Moreover, that there is so little focus 

on a position which is such a priority for tribes is, in and of itself, proof positive 

of the centrally critical role this Office, properly staffed and funded, could play at 

DOE. Moreover, if we were to look at the plain language of the authorized statutory 

language—a Director was authorized which implies that the Director should have 

basic direction authority over Indian energy policies and programs. So far the 

OIEPP Director has only languished under DOE’s Intergovernmental offices—with 

non policy or program oversight. That too must change. Although we recognize that 

the Office has not been appropriated the funds authorized in past years, and the 

Office of Intergovernmental has stepped in to administratively host the position in 

the past administration—the fact remains that it was authorized to stand alone 

and, moreover, it authorized Director to direct Indian energy policy and programs 

and we call for it to be not just filled but to also be restructured to fill this very 

important policy and programmatic role. 

B. Department of Interior/Indian Lease Support. For renewable and energy infrastructure projects on Indian lands, for the Department of Interior, it remains a basic 

fact that in order to secure rights to a project and site any sort of renewable investment, the base agreement on Indian lands will involve a lease and/or right of way 

agreements. We fear an even greater bottleneck at the Bureau of Indian Affairs unless additional training and resources are devoted to ensuring prompt approval of 

leases and right of way grants. Among other things, BIA should provide tribes with 

a specific checklist of material they need and develop timelines for the approval 

process. Transparency and predictability are key virtues and should be central objectives in BIA’s evaluation, processing and approval of the myriad of pre-development, development, construction and operational agreements necessary for any commercial project. The Bureau of Indian Affairs needs additional, updated and adequate support for the new and complex set of tasks it will be charged with during 

this wave of clean energy development—support that will help it retain and fulfill 

its central trust responsibility as well as support that will help Tribes fulfill the 

promise set before us today. 

About Indian Country Renewable Energy Consortium 

In 2009, the Indian Country Renewable Energy Consortium was formalized as by 

its original founding members—the Cherokee Nation, the Lower Sioux Indian Community, Oneida Nation of Wisconsin, Osage Nation of Oklahoma and Sealaska CorVerDate Nov 24 2008 11:11 May 24, 2010 Jkt 056321 PO 00000 Frm 00040 Fmt 6633 Sfmt 6621 S:\DOCS\56321.TXT JACK PsN: JACKF
37 

poration. Since its formation, other Tribes and tribal entities have joined as members, including Tribes and tribal corporations whose reservations are located in the 

Dakotas to the Pacific Northwest to Southwest States to California. 

The founding Tribes made a collective decision to focus on policy matters now actively before the Administration and Congress. Many of the founders, including 

Osage Nation which is testifying on behalf of the Consortium today, are Tribes 

which already have energy production but are seeking to, as the country is, diversify 

its energy economy through clean energy development. While the Tribes involved in 

ICREC have long lived in harmony with their natural surroundings and indeed 

thrived by utilizing their natural, often renewable, resources, they now are looking 

at the sun’s, wind’s and water’s abundance as the source of greater self-sufficiency 

and accordingly self-governance. ICREC members are optimistic that this time 

tribes will share in the emerging economic opportunity. Working with this Congress 

and this Administration, we are confident to find a way to bring some equity and 

opportunity to Indian Country in this new clean energy frontier. 

Conclusion 

ICREC is representative of not only the member Tribes, but representative of numerous Tribes who are interested, already invested in or able to invest in renewable 

energy projects in Indian Country—to finally have an opportunity to be an equity 

participant and owner in Tribal projects. Economic development and diversification 

cannot grow in Indian Country unless the infrastructure is there to support it and 

unless Tribes can play a significant part in the ownership and control of infrastructure Until that happens, the cycle continues. 

Renewable energy represents an opportunity to break this cycle of passive economic participation by Tribes in a sector that has, for obvious philosophical and cultural reasons, stimulated tremendous interest by Indian Country and also stimulated tremendous interest by industry to site projects in Indian Country. An intriguing twist of history has placed reservation lands in some of the most arid and 

windiest areas of the country. In addition, often by use of coercive tactics, transmission siting has often occurred on tribal lands. These two factors now present 

unrivaled opportunities to Tribes to finally develop some of the best class wind and 

solar resources not just in North America but the world. 

This Administration and this Congress has made sincere attempts to make investment and siting of renewables more economically feasible. The recommendations 

and opportunities discussed today will ensure that Indian Tribes, tribal enterprises 

and Alaska Native Corporations will be participants. We look forward to continuing 

to work with you to make this a reality. 

Thank you. 

The CHAIRMAN. Chief Gray, thank you very much. We appreciate 

your being here. 

Now we will hear from the Honorable Steve Herrera, who is a 

Tribal Council Member from the Southern Ute Indian Tribe in Colorado. Mr. Herrera, thank you very much for being with us. You 

may proceed. 

Let me say that the entire statement will be in the record. We 

are taking your summaries, of course, but your entire statement 

will be made a part of the permanent record of the Committee. 

STATEMENT OF HON. STEVE HERRERA, TRIBAL COUNCIL 

MEMBER, SOUTHERN UTE INDIAN TRIBE; ACCOMPANIED BY 

TOM SHIPPS, LEGAL ADVISOR 

Mr. HERRERA. Chairman Dorgan, thank you for allowing us to 

speak today, Vice Chairman Barrasso and the rest of the Committee. It is an honor for the Southern Ute Tribe to be called on 

to provide testimony today. And it is a personal honor for me to 

be here as well. 

Today I am accompanied by Mr. Tom Shipps, who is a longstanding legal advisor for the Southern Ute Tribe with 30 years experience. His firm was employed first in 1968, so we have a lot of 

38 

help from that firm in all of our aspects of our governing and our 

oil and gas revenues. 

Today I would like to give a little background of the tribe and 

its history. We have approximately 1,447 tribal members. Our reservation encompasses 700,000 acres in the southwest of Colorado. 

We have a checkerboard reservation, which incorporate fee land, 

trust land and other lands as well. 

History of the oil and gas success. My written testimony contains 

more detail about the steps our tribe has taken in natural gas development. But I will summarize some of that history today. In 

1949, the tribe began leasing and was in the role of a passive royalty owner. In 1980, the tribe created its own energy department. 

The purpose was to study and collect data on the resources under 

the ground in which we knew there was resources but we did not 

know what, how much resources there were and how much reserves there might have been. 

In the late 1980s, we negotiated flexible mineral agreements 

under the Indian Mineral Development Act. In 1992, we actually 

formed our own gas company, which is called Red Willow Production Company, which actually provides most of the revenue to the 

Southern Ute Tribe. 

In 1994, with help from a partner, we purchased an on-reservation pipeline gathering and treating company called Red Cedar 

Gathering Company. Today we have operations in approximately 

10 States and the Gulf of Mexico and most of these have been remarkably successful. Success in energy has translated to a better 

life for our tribal members. This Committee has a very big responsibility and we appreciate everything that has been done to date. 

Hopefully we can get through some of these hurdles. 

Representatives from our tribe have been part of an ad hoc working group of Indian tribes and organizations to review problems in 

Indian Country related to energy development and potential situations. We are generally supportive of the ad hoc working group and 

responses to the committee staff’s concept paper. Today I would 

like to bring special attention to a few items that we have. Item 

number one is the tribal energy resource agreements. The Energy 

Policy Act of 2005, Title V, establishes opportunity for electing 

tribes to contract with the Secretary to remove energy-related approvals from the Secretary Congress intended to be a broad and 

flexible win. 

The Department of Interior passed implementing regulations 

that accepted inherent Federal functions from what could be included in a TERA. Inherent Federal functions is not defined in the 

regulations and it is believed that we need to define those in order 

to move forward. In fact, to date, I do not believe that there have 

been any tribes who have entered into a TERA. It is believed that 

because of the inherent Federal functions concept or exemption, 

this is one of the reasons why. 

Number two, NEPA review, related Interior approval, leases and 

rights-of-way applications for permits to drill and other land related to approvals unduly delays decision-making and opportunities 

in Indian Country. Solutions in this area range from removing tribal land decisions from NEPA to allowing tribal environmental review procedure to be a substitute for NEPA review or alternatively, 

39 

set mandatory deadlines for completion of reviews. Indian lands 

should not be treated like public lands. 

Number three, granting, perfecting and establishing priority of 

security interest in Indian lands associated with energy projects. 

There is no clear, simple system. This is an impediment to access 

to commercial capital. 

Number four, absence of diversity, jurisdiction, and access to 

Federal courts for Indian tribes, tribally-owned entities and those 

who contract with them also independent to commercial capital and 

contracting with third parties. 

Mr. Chairman, I would like to again thank you for allowing the 

Southern Ute tribe to provide testimony today. We look forward to 

working together to identify current and historical road blocks and 

removing those to help tribes develop their own lands and become 

successful in obtaining financial success for their membership as 

well as the Country. Thank you. 

[The prepared statement of Mr. Herrera follows:] 

PREPARED STATEMENT OF HON. STEVE HERRERA, TRIBAL COUNCIL MEMBER, SOUTHERN UTE INDIAN TRIBE

Good afternoon Chairman Dorgan, Vice Chairman Barrasso, and members of the 

Committee on Indian Affairs. I am Steve Herrera an elected member of the Southern Ute Indian Tribal Council, the governing body of the Southern Ute Indian Tribe. 

Unfortunately, our Chairman, Matthew Box, is unable to attend this hearing on the 

Southern Ute Indian Tribe’s behalf because of an important, previously scheduled, 

medical appointment. However, the Tribal Council and the Chairman have designated me to appear before you today on behalf of the Southern Ute Indian Tribe. 

In addition to our tribe being honored by your invitation to testify, it is a great personal honor to appear before you today. 

Also with me is Tom Shipps, whose firm has served as general legal counsel for 

our tribe since 1968. Mr. Shipps has represented us on energy matters for more 

than 30 years. He has testified before this Committee on several occasions and has 

worked cooperatively with Committee members and staff throughout his distinguished career. If needed in answering questions, I would like to call upon him for 

assistance. 

As a final introductory matter, our tribe would like to thank the Committee, not 

only for its work on behalf of tribes in the energy arena, but also for it leadership 

on numerous issues that affect Indian people throughout this Country, including 

law enforcement and health care. 

Background 

The Southern Ute Indian Reservation, the exterior boundaries of which were confirmed by Congress in 1984 (Pub. L. No. 98–290, 98 Stat. 201), consists of approximately 700,000 acres of land located in southwestern Colorado in the Four Corners 

Region. The land ownership pattern within our Reservation is complex and includes 

tribal trust lands, allotted lands, non-Indian patented lands, federal lands, and state 

lands. Based in part upon the timing of issuance of homestead patents, sizeable portions of the Reservation lands involve split estates in which non-Indians own the 

surface but the tribe is beneficial owner of oil and gas or coal estates. In other situations, non-Indian mineral estates are adjacent to tribal mineral estates. These land 

ownership patterns have significant implications when considering energy mineral 

development ranging from the potential for drainage to jurisdiction. Historically, we 

have established solid working relationships with the State of Colorado and local 

governmental entities, which have minimized conflict and emphasized cooperation. 

Our reservation is a part of the San Juan Basin, which has been a prolific source 

of oil and natural gas production since the 1940s. Commencing in 1949, our tribe 

began issuing leases under the supervision of the Secretary of the Interior. For several decades, we remained the recipients of modest royalty revenue, but were not 

engaged any active, comprehensive resource management planning. That changed 

in the 1970s for our tribe as energy resource tribes in the West recognized the potential importance of monitoring oil and gas companies for lease compliance and 

maintaining a watchful eye on the federal agencies charged with managing our resources. A series of events in the 1980s laid the groundwork for our subsequent sucVerDate Nov 24 2008 11:11 May 24, 2010 Jkt 056321 PO 00000 Frm 00043 Fmt 6633 Sfmt 6621 S:\DOCS\56321.TXT JACK PsN: JACKF
40 

cess in energy development. In 1980, the Tribal Council established an in-house Energy Department, which spent several 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, our Tribal Council enacted a severance 

tax, which has produced more than $500 million in revenue over the last three decades. After Congress passed the Indian Mineral Development Act of 1982, we carefully negotiated mineral development agreements with oil and gas companies involving unleased lands and insisted upon flexible provisions that vested our tribe with 

business options and greater involvement in resource development. 

In 1992, we started our own gas operating company, Red Willow Production Company, which was initially funded through a Secretarially approved plan for use of 

$8 million of trust funds received in settlement of 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. In 1994, we participated with a partner to purchase one of 

the main pipeline gathering companies on the Reservation. Today, our tribe is the 

majority owner of Red Cedar Gathering Company, which provides gathering and 

treating services throughout the reservation. Ownership of Red Cedar Gathering 

Company allowed us to put the infrastructure in place to develop and market coalbed methane gas from Reservation lands and gave us an additional source of revenue. Our tribal leaders recognized that the peak level of on-Reservation gas development would be reached in approximately 2005, and, in order to continue economic 

growth, we expanded operations off the Reservation. 

Today, the Southern Ute Indian Tribe, through its subsidiary energy companies, 

conducts sizeable oil and gas activities in approximately 10 states and in the Gulf 

of Mexico. Despite the recent downturn in energy commodity prices, we continue to 

be successful and growing. We are the largest employer in the Four Corners Region. 

We are also diversifying into other areas, including renewable energy development. 

Along the way, we have encountered and overcome numerous obstacles, some of 

which are institutional in nature. We have also worked actively with this Committee over the decades in an effort to make the path easier for other tribes to take 

full advantage of the economic promise afforded by tribal energy resources. 

These economic successes have allowed us to provide a higher standard of living 

for our tribal members than many would have thought possible a generation ago. 

Our members have jobs. Our educational programs provide meaningful opportunities at all levels. Our elders have stable retirement benefits. We have exceeded 

many of our financial goals, and we are well on the way to providing our children 

and their children the potential to maintain our tribe and its lands in perpetuity. 

Indian Energy Initiative 

One persistent theme reflected in the last thirty years of our tribe’s history is the 

notion that ultimately we are the best protectors of our own resources and the best 

stewards of our own destiny; provided that we have the tools to use what is ours 

and reasonable access to opportunities extended to other members of society. 

Though recognizing the critical historical importance of the federal trust responsibility, we also see on a daily basis the immobility that arises from forced reliance 

on a pervasive system of protection that is underfunded, understaffed, and often of 

questionable competence. Congress has created many paths for tribes to assume increased control over the governmental institutions that affect the daily lives of tribal 

members, and our tribe has taken advantage of many of them. The shift in roles, 

however, is particularly difficult when the systems that are being transferred are 

broken. Even for our tribe, which has achieved remarkable success, the challenges 

and responsibilities of preserving our culture, our tribal community, and our remaining attributes of sovereignty are daunting. We believe that this Committee 

knows that improvements can be made in fostering effective tribal governance and 

opportunity, and that when recognized, impediments to tribal success can be removed. It is for all of those reasons that we have participated actively in recent discussions related to problem-solving in the energy arena, and we hope that our ideas 

will be of value to the Committee. 

Representatives of our tribe have participated actively in an ad hoc working group 

of energy producing tribes and associated organizations, which has responded to the 

initial energy concept paper prepared by this Committee’s staff. Although we have 

been involved in discussions related to all of the issues contained in the initial concept paper, we have also identified some specific items that we hope will be addressed by the Committee and, potentially, in legislation. 

First, with respect to Title V of the Energy Policy Act of 2005, we were vocal advocates for the Tribal Energy Resource Agreement (TERA) mechanism approved by 

Congress. We believe that the Secretary’s regulations implementing those provisions 

41 

undermined much of what Congress intended by eliminating ‘‘inherent Federal functions’’—an undefined term in the regulations—from the scope of functions that could 

be assumed by a tribe. To be sure, the Director of the Office of Indian Energy and 

Economic Development has encouraged us to prepare a proposed scope for a Southern Ute TERA, and we may yet prepare one. We do request, however, that the Committee examine this issue and obtain some clear understanding from the Administration as to how this regulatory restriction is to be interpreted. 

Second, we strongly believe that National Environmental Policy Act (NEPA) review mandated in the course of a federal agency’s consideration of approval or disapproval of tribal land use decisions and related activities discourages tribal energy 

development, whether renewable or non-renewable. We have provided several suggestions for mitigating the unintended adverse consequences of NEPA review on Indian lands. Those suggestions include removing Indian lands from NEPA review, 

utilization of alternative tribal environmental review processes, and commanding 

expeditious review by Federal agencies involved in decisions affecting tribes or their 

lands. 

Third, one impediment to access to commercial capital related to tribal energy 

projects involves the absence of an effective, clear system for issuing security interests in tribal lands in a way that will confirm a first priority in the event of default. 

We urge the Committee to investigate the relationship of the BIA Land Title and 

Records system and its function, if any, in perfecting or providing assurances of priority of encumbrances and security interests with respect to tribal energy projects. 

Fourth, we request that this Committee initiate review and communicate with 

other applicable committees the absence of access by tribes or parties contracting 

with tribes to federal courts under diversity jurisdiction. This limitation imposes institutional obstacles to tribes who wish to provide for effective and commercially acceptable judicial mechanisms for dispute resolution, yet who are unwilling to default 

to state courts in the resolution of potential contractual disputes. 

Conclusion 

In conclusion, the Southern Ute Indian Tribe is honored to appear before you 

today. We intend to remain active participants in this process as it develops, and 

we believe that our experiences have contributed to a unique perspective on matters 

related to energy development in Indian country. 

The CHAIRMAN. Mr. Herrera, thank you very much for being 

here. 

Finally, we will hear from the Honorable Ralph Sampson, Chairman of the Yakama Nation, Indian tribe in Toppenish, Washington. Mr. Sampson, welcome. You may proceed. 

STATEMENT OF HON. RALPH SAMPSON, JR., CHAIRMAN, 

YAKAMA NATION 

Mr. SAMPSON. Thank you, Mr. Chairman and members of the 

Committee. Good afternoon. 

My name is Ralph Sampson, Jr. I am Chairman of the Confederated Tribes and bands of the Yakama Nation. Also, I am Chairman of the Board of Directors for Yakama Power, the Yakama Nation’s publicly-owned utility. Our utility has been delivering power 

since 2006, and serves four average megawatts. We are actively 

growing to serve the entire reservation and working to provide renewable energy generation to the Northwest. 

We support many of the ideas of the committee concept paper 

and greatly appreciate this Committee’s willingness to assist tribes. 

We would like to see five obstacles of energy development addressed by this or other legislation, and we have experienced all of 

these problems first-hand in forming our utility and working as a 

public utility. 

The first is in dealing with the National Environmental Policy 

Act implementation. The Bureau of Indian Affairs and the Yakama 

Nation require environmental assessments that follow NEPA procVerDate Nov 24 2008 11:11 May 24, 2010 Jkt 056321 PO 00000 Frm 00045 Fmt 6633 Sfmt 6601 S:\DOCS\56321.TXT JACK PsN: JACKF
42 

ess for all major projects on the Yakama Reservation. What is frustrating is that the BIA’s sister Federal agencies are requiring separate NEPA reviews of our environmental assessments. The original 

NEPA process takes six months to a year, only to have the various 

programs within the Government repeat the same process, doubling the time involved. This is done at the USDA under the Rural 

Utilities Service, RUS, and at Bonneville Power, the Administration and the Department of Energy. 

We understand and encourage the protection of the environment, 

as we are stewards of our land also. But this process places an 

undue burden on the tribal projects. We need a process that requires these other Federal agencies to participate in the original 

NEPA process, not to oversee what has already been done or to 

simply provide comments instead of repeating that whole process. 

Second, despite statutory language encouraging Federal agencies 

to purchase renewable energy, especially from Indian tribes, whenever we attempt to sell our renewable energy to Federal agencies 

operating within our reservation, we get nowhere. The failure 

means our local economy was not stimulated and the Federal incentive for renewable energy on our reservation evaporated. 

We need a Federal regulation or programs with teeth to support 

the development of Indian renewable energy and the purchase of 

power by Federal agencies, especially those operating on our reservation. One potential solution would be to have Federal agencies 

that acquire Indian renewable energy and delivers it to key trading 

hubs for use with other Federal agencies. 

Third, we would encourage that any legislation that is proposed 

and or enacted would be supported in the budgeting process. The 

Energy Act of 2005 promoted the production of renewable energies 

by providing money in various grants and loans, but failed mainly 

because many of the provisions of the Act had never been funded. 

Fourth, based on their experiences, tribes need statutory language that makes it clear that when the BIA transfers title or control of a Federal irrigation project, small hydro turbines and related substations or local distribution lines to a tribe, language in 

transmission contracts between the BIA and its sister Federal 

power marketing agencies, namely BPA and WAPA, cannot be used 

to prevent such transfers simply because the transmission contracts fail to contemplate such unique circumstances in Indian 

Country. 

Federal law makes it clear that empowering the tribe to manage 

their own affairs on their reservations and to pursue development 

of renewable energy are primary Congressional goals. 

Finally, that leads to our last issue. The Yakama Nation, 

through our tribal utility, Yakama Power, paid to examine, rebuild 

and restore three hydro power turbines on the Wapato Irrigation 

Project, a federally-owned and operated irrigation project. The irrigation project benefits both the Yakama Nation and many non-Indian farmers who farm the majority of these irrigated lands. Built 

in the 1930s and 1940s, the turbines have nameplated capacities 

of 4.2 megawatts. 

The sale of the renewable energy from these turbines will provide revenues back to the Federal irrigation projects for projectwide repair and maintenance. The BIA has never had the funds to 

43 

repair these old turbines. This has only been made possible because 

Yakama has used $3.2 million of its own utility’s money with the 

understanding that if we couldn’t get the money back any other 

way, the $3.2 million would be repaid to our utility from the sale 

of energy. But if that happens, our utility cannot expand, or this 

Federal irrigation project will not have the money from the energy 

sales to cover its long-deferred maintenance for quite some time. 

We attempted to apply for a DOE grant for the development of 

small scale hydro projects that would have covered this debt that 

the Federal Government owes us. But because of a technicality in 

the law, the projects have FERC license. We are not eligible, we 

didn’t have a FERC license because this is a Department of Interior project and thus exempt from FERC licensing. 

Any help that we can get recovering this money from the Federal 

Government would be much appreciated, whether in fixing the 

DOE grant requirements so that non-FERC licensed projects are eligible or providing a one-time appropriation to the BIA to repay the 

money. 

Ultimately, perhaps Committee members could assist in getting 

a waiver form FERC requirements for using their money only for 

FERC-licensed hydro projects. I appreciate this opportunity to 

speak before the Committee. 

Thank you, Mr. Chairman. 

[The prepared statement of Mr. Sampson follows:] 

PREPARED STATEMENT OF HON. RALPH SAMPSON, JR., CHAIRMAN, YAKAMA NATION

Good afternoon, my name is Ralph Sampson, and I am the Chairman for the 

Yakama Nation Tribal Council, and the Chairman of the Board of Directors for 

Yakama Power, the Yakama Nation owned utility. Our utility has been delivering 

power since 2006, and serves 4 average megawatts. We are actively growing to serve 

the entire reservation, and are working to provide renewable energy generation to 

the northwest. 

We support many of the ideas in the Committee’s concept paper and greatly appreciate this Committee’s willingness to assist tribes. We would like to see five obstacles to energy development addressed by this or other legislation. 

The first is in dealing with National Environmental Policy Act implementation. 

The Bureau of Indian Affairs and the Yakama Nation require environmental assessments that follow NEPA, for all major projects on the Yakama Reservation. What 

is frustrating is that the BIA’s sister federal agencies are requiring separate NEPA 

reviews of our Environmental Assessments. The original NEPA process takes six 

months to a year, only to have the various programs within the government repeat 

the same process, doubling the time involved. This is done at USDA under the 

Rural Utilities Services or RUS, at the Bonneville Power Administration, and the 

Department of Energy. We understand and encourage the protection of the environment, but this process places an undue burden on tribal projects. We need a process 

that requires these other federal agencies to participate in the original NEPA process or to simply provide comments instead of repeating the NEPA process. 

Second, despite statutory language encouraging federal agencies to purchase renewable energy, especially from Indian tribes, whenever we attempt to sell our renewable energy to federal agencies operating within our Reservation, we get nowhere. This failure means our local economy was not stimulated and the federal incentive for renewable energy on our Reservation evaporated. We need a federal regulation or program with teeth to support the development of Indian renewable energy and the purchase of that power by federal agencies especially, those operating 

on Indian reservations. One potential solution would be to have a federal agency 

that acquires Indian renewable energy and delivers it to key trading hubs for use 

by other federal agencies. 

Third, we would encourage that any legislation that is proposed and or enacted, 

would be supported in the budgeting process. The Energy Act of 2005, promoted the 

production of renewal energies by providing money in various grants and loans, but 

failed mainly because many of the provisions of the Act have never been funded. 

44 

Fourth, based on our experiences, tribes need statutory language that makes it 

clear that, when the BIA transfers title or control of a federal Indian irrigation 

project’s small hydro turbines and related substations and local distribution lines to 

a tribe, language in transmission contracts between the BIA and its sister federal 

power marketing agencies, BPA and WAPA, cannot be used to prevent such a transfer simply because the transmission contracts failed to contemplate such unique circumstances in Indian country. Federal law makes it clear that empowering the 

tribes to manage their own affairs on their reservations and to pursue development 

of renewable energy are primary Congressional goals. 

Finally, that leads to our last issue. The Yakama Nation through its tribal utility, 

Yakama Power, paid to examine, rebuild, and restore three hydropower turbines on 

the Wapato Irrigation Project, a federally owned and operated Indian irrigation 

project. This irrigation project benefits both the Yakama Nation and many non-Indian farmers who farm the majority of these irrigated lands. Built in the 1930s and 

1940s, the turbines have a nameplate capacity 4.2 megawatts. The sale of the renewable energy from these turbines will provide revenues back to this federal irrigation project for project-wide repairs and maintenance. The BIA has never had the 

funds to repair these old turbines. This was made possible only because the 

Yakama’s used 3.2 million dollars of its utility’s money with the understanding that, 

if we couldn’t get the money back any other way, the $3.2 million would be repaid 

to our utility from the sale of the energy. But if that happens, our utility cannot 

expand, and this federal Indian irrigation project will not have the money from the 

energy sales to cover its long deferred maintenance for quite some time. 

We attempted to apply for a DOE grant for the development of small scale hydro 

projects that would have covered this debt that the Federal Government owes us. 

But because of a technicality in the law, that the project have a FERC license, we 

weren’t eligible. We didn’t have a FERC license because this is a Department of Interior project and, thus, exempt from FERC licensing. 

Any help we can get in recovering this money from the Federal Government 

would be much appreciated, whether in fixing the DOE grant requirements so that 

non-FERC licensed projects are eligible or any providing a one-time appropriation 

to the BIA to repay the money. 

I appreciate this opportunity to testify and if I can answer any questions, please 

let me know. 

The CHAIRMAN. Mr. Sampson, thank you very much. We appreciate the testimony that all four of you have given. 

I am going to, in the interest of time, because Senator Murkowski has to leave, I am going to recognize Senator Murkowski 

first for questions, then I will recognize Senator Udall and then I 

will complete questions following that. 

Senator Murkowski. 

Senator MURKOWSKI. Thank you, Mr. Chairman. I appreciate the 

courtesy to my schedule. 

And gentlemen, I appreciate your testimony here this afternoon. 

There is certainly a recurring theme that each of you have raised. 

You have talked about the NEPA issues, you have talked about 

just the regular process that seems to strangle many good projects. 

And then of course, at the end of the day, it always comes down 

to how we are going to finance this, how we are going to make this 

happen. 

We have a situation up in the State of Alaska right now, Cook 

Inlet Region is looking to build a 60 megawatt farm, and they are 

also looking to move forward on a demonstration project that would 

provide for coal gasification technology to advance. But what they 

are finding is that there is no Federal aid that is currently available. So they have to figure out how they piece this together internally. That, as we all recognize, is very, very difficult. 

I think it was you, Mr. Gray, that suggested that typically what 

we do around here is we advance tax credits, production tax credits, and that is one way to facilitate projects. But with the tribes, 

45 

that is not a mechanism that can be realized. You have suggested 

perhaps monetization of those credits. 

I direct this to all of you in terms of what you think that we can 

do, particularly given what we are seeing right now with the very 

tight credit markets, how can we better facilitate the financial end 

of some of the roadblocks that we are seeing with Indian energy 

projects right now? Mr. Gray? 

Mr. GRAY. Thank you for the question. I really do want to just 

add to the urgency that exists in Alaska that most people may not 

be aware of, that in Native villages in Alaska, that the electrical 

costs for heating their homes is often ten times the national average. So the burden is twice as hard on them to find renewable resources. 

To the extent that we can tweak the law to make it possible for 

tribes who have limited capital investment capacity to be able to 

partner with industry that has the capacity to do this, this gives 

the tribes what we would call an investment capability into a 

project. By monetizing some of the tax incentives and the production tax credits and the investment tax credits, the tribes would be 

a full partner in many ways to participate in these projects. This 

would ensure at least the production of these renewable resources. 

The problem that I continue to see, that I am certain is probably 

just as evident in Alaska as it is in the lower 48, and that is that 

the electrical grid needs a major overhaul in this Country. Much 

like the Federal highway system needed a major commitment from 

the United States to see it through, the electrical grid provides not 

only development opportunities but capacity building for individual 

tribes across the Country who have often been left out of the whole 

process over the years, just because of the bureaucratic issues that 

we have raised already. 

So those two issues seem to be the big, important ones. The 

bonding authority for tribes to be able to issue bonds to be able to 

finance these kinds of projects is also critical to the development 

of sustainability. And having a degree of tribal control over the development and allocation of electrical resources. 

Senator MURKOWSKI. Mr. Herrera, do you have anything that 

you wanted to add on that? I know you have certainly been keyed 

in on the financial transaction aspect of it. 

Mr. HERRERA. Yes, ma’am, and thank you very much for asking 

the question. 

Some of the projects that are not seen or followed through with 

are because of a lack of financial backing is in some cases attributed to lack of recording for the monetization or the potential for 

the financial backer to make sure that they have access to that 

land if there is a foreclosure or if there is a potential for the tribe 

to become delinquent. So one of the things that we think is, we 

need to set up a recording and monitoring of these lands so that 

whenever a financial backer comes onto the reservation, that we 

can actually show that they have first right of refusal or there is 

actually some monetary amounts that they can recapture from this 

investment. Because they pretty much stay away from it if they 

aren’t assured that they can actually recoup their money. 

So being able to have a system in place to ensure that they understand and it is actual that there is a method for them to recoup 

46 

their money, or at least to make sure that they don’t lose the investment in whole. 

Senator MURKOWSKI. Mr. Levings, I understand that you had 

participated in crafting at least certain parts of the 2005 Energy 

Act. It was not just me, I think Senator Udall noted it, I think it 

is recognized that much of what we had hoped was going to materialize from that 2005 Energy Act, when it comes to the Indian energy title, we haven’t seen. Do you have any specific suggestions as 

to how we could have made it work better or in hindsight now, 

what we should have done differently? 

Mr. LEVINGS. Senator Murkowski, I wasn’t involved in that, I 

don’t believe. 

Senator MURKOWSKI. Okay, well, we are giving you credit for 

that. 

[Laughter]. 

Mr. LEVINGS. The one-stop shop, though, Senator, I was involved 

with. 

Senator MURKOWSKI. Maybe that was it. 

Mr. LEVINGS. I guess I am kind of a grass roots chairman, as my 

colleagues here and fellow presidents and chairs and council members and councilwomen across Indian Country. I came up from the 

bottom. I was a realty specialist in Warm Springs, Oregon, back in 

1990 and 1991. I did work in oil and gas as a land man. And now 

to come full circle as chairman, to see all of the hurdles and the 

red tape and the bureaucratic process, it is amazing that oil industry comes to Indian Country. 

The 49 Steps, for instance, that Chairman Dorgan, he got those 

right from our people on the ground at the agency. 

Senator MURKOWSKI. You weren’t making up the numbers? 

Mr. LEVINGS. No, it is actual. Then you almost had a 50th step 

with the EPA guideline that they were going to try to implement 

on Fort Berthold. It is really frustrating, because every morning I 

wake up and I look out the west window where I live. I am about 

half a mile from the reservation border on the western side by 

Keene and Charleston. And there is a derrick standing up on the 

ground. Twenty days later, there is a 30-foot flare of natural gas 

flaring. They move the rig southwest, I would say, a quarter of a 

mile, and they are drilling there. And then there is another flare. 

And they are just going right down the line. And it is on fee land 

off the reservation. 

I am looking on my land, my grandparents’ land, the Wells place, 

the Levings place, Bird Bearers, Banks, all the way down to the 

buttes, and it is dark. But off the reservation, it is light to the 

west, it is just a horizon. It is like coming up into a city horizon. 

You go north, same difference. I can look out my porch on the east 

side of the home, on the north side, it is just lights up there. And 

that is just from my front steps. 

Now, my elders, they see this day in and day out. And their 

words are this, Chairman, I signed the lease. I am going to get my 

bonus and I am going to spend it, but I am never going to see royalties. I am going to die before I see my royalties. And three of 

those grandmas have passed on. 

That is our frustration. So that photo, that map up there is reality. And on the reservation, as many tribal leaders will attest to, 

47 

when things go bad, you blame the council and you blame the 

chairman. And right now, that is the problem that we have, there 

is a lot of finger-pointing. When that happens, it gets a connotation 

that you are not doing enough. So any time I am requested to be 

here to give the grass roots, what is really happening, here I am. 

Because I need to pass the message along. 

With the 2005 opportunity, I don’t know why we wouldn’t try it. 

Because Fort Berthold, the Mandan, Hidatsa and Arikara, we want 

to try anything and everything. There is a TERA provision in 

there. The second opportunity would be to 638 contract the Bureau 

of Indian Affairs’ realty program. 

But the problem I have on Fort Berthold is in 1986, they had a 

referendum. And the people voted not to do that. So 2009, I would 

have to send it back to the Mandan, Hidatsa and Arikara 11,000 

membership and ask them, is it safe to do it today. Because that 

would provide us an opportunity to do our own paperwork. 

However, the Federal Government still has to sign off on those 

leases and permits. So, Senator, in the long and short of it, I am 

really frustrated. 

Senator MURKOWSKI. We hear your frustration. But you are 

clearly doing more than just working at the grass roots. You are 

obviously representing your people well, and I thank you for your 

testimony. 

Thank you all. Thank you, Mr. Chairman. 

The CHAIRMAN. Senator Udall. 

Senator UDALL. Thank you, Mr. Chairman. Thank you for allowing me to go at this point. 

Let me just follow up, Chairman Levings, with you. As you know, 

and you were here when Senator Dorgan put the chart up, you 

should know you have a real champion in him. 

Mr. LEVINGS. Yes. 

Senator UDALL. He has put that chart up many times, when 

Larry Echo Hawk was here, when Secretary Salazar was here. He 

is trying to shake the bureaucracy and get things done with you. 

He is really making an attempt, I think, to cut through the bureaucracy and get things done. 

One of the things, in light of talking about bureaucracy that I 

would like to ask, if any of you on the panel have any experience 

with this, when we passed the 2005 Energy Bill, one of the provisions to try to cut through bureaucracy allowed tribes to enter into 

mineral leases without day to day oversight from the Secretary. 

But apparently, no tribe has applied for this program. Do any of 

you have any sense of why that has happened, why that provision 

hasn’t helped us move this along? Please, go ahead, Mr. Gray, go 

ahead, or Chairman Levings. 

Mr. GRAY. We affectionately refer to it as the war on TERA back 

home in Indian Country, largely because people are in the mind set 

that there is a lot of things that tribes give up in way of the trust 

responsibilities that often should come with some kind of balancing. This is what we get in return for giving up certain portions 

of our trust responsibilities. Tribes haven’t been able to really find 

that balance very equitable. I think that many times that we, especially those treaty tribes, certainly do hold those trust responsibilities very near and dear to their heart as a generational obligation 

48 

that they pass down from their elders to their children. And anyone who breaks that agreement is highly criticized back home. 

The critical elements of the Tribal Energy Resource Agreements 

require us to give up certain responsibilities to the United States 

or waive the liability of the United States on certain projects. And 

while the details of each individual TERA may be different from 

tribe to tribe, the overall message that tribes got from that agreement is that there is a lot of liability that the United States does 

not any longer want to absorb in developing tribes’ energy resources. 

Because of that, I think tribes are stuck in limbo, saying, well, 

short of that, what can we do? Because no one wants to go to that 

ultimate step of being the first one to go through the chute, as they 

say. I would say that right now, that is probably the biggest reason. 

Senator UDALL. Please, Chairman Sampson, go ahead. 

Mr. SAMPSON. Thank you. I would like to agree with Chairman 

Gray that it is true that it is, I take an oath of office just like you 

do. It is within our oath that we are to uphold the treaty of June 

9th, 1855, the Yakamas with the United States of America. In that 

treaty, there are trust responsibilities that are obligating the 

United States to uphold to. By signing onto that, we would be relinquishing some of the trust responsibilities. That is mainly the 

main course why you haven’t seen the Yakama Nation sign onto 

that. 

Senator UDALL. Please, Councilman Herrera. 

Mr. HERRERA. Thank you, Senator Udall. Thank you for the 

question. 

We feel that along with comments that have been heard already 

is that it is a government responsibility. We have been in that 

mode for a very long time. Of course, there is a lack of funding in 

all aspects of the oversight and the responsibility of the Government to take care of the tribal organizations or tribal members and 

tribes as well. One of the other aspects is, it is difficult for a certain 

tribe to go ahead and enter into this type of agreement with actually some comprehension of, what does this mean for all of Indian 

Country. 

So if we go into it and there is negative impacts that are seen 

in the future, it is one of those things where we really have a hard 

time, and we are apprehensive to doing it, because there could be 

some negative connotations that are going to be seen throughout 

Indian Country, and definitely no tribe wants to be set in the forefront of establishing negative impacts to the rest of the tribes in 

the United States. 

Senator UDALL. Thank you. Chairman Levings? 

Mr. LEVINGS. Senator Udall, the Three Affiliated Tribes, the 

Mandan, Hidatsa and Arikara, have heard the problems, heard the 

stumbling blocks, the hurdles. And we took care of many of those 

in 1997 under the support of Chairman Dorgan and Senator Conrad and Congressman Pomeroy. They established an opportunity 

for Fort Berthold to change the mineral ownership requirement for 

a lease from 100 percent criteria to 51 percent. That was one of the 

hurdles. 

49 

The second one was we had a dual taxation in the State of North 

Dakota. So the tribal council and the Governor and the legislative 

body for North Dakota worked that out. We have an MOU on tax, 

there is one tax and we divvy it up and we work through it. Of 

course, it was respectively to not waive any sovereignty. 

Then we also did a regulation. This month, or shortly into November, Governor Hoeven and I are going to sign that document 

in the tribal chambers. So we are doing everything we can to remove the uncertainty for the industry. We are working here with 

Chairman Dorgan and the one-stop shop to make it perfect, is probably the word that I am looking for, because right now, it is not 

staffed yet. There are some things that have to do. 

The TERA itself, I am willing to try it. I was ready and willing 

to go with the MOU with the State, with a one-stop shop with 

them. But I wanted to give Chairman Dorgan his all due attention, 

because he said he was going to give me that opportunity to 

streamline. And I believe it is going to get done. Because Chairman 

Dorgan can build bridges. There is one built at Fort Berthold, and 

it cost $50 million and he got it done. So that is not an issue. 

[Laughter.] 

The CHAIRMAN. It’s not a bridge to nowhere, right? 

[Laughter.] 

Mr. LEVINGS. So he can move mountains as well, if we need 

Rocky Mountains moved, he can do it. 

So what I am doing as a chairman is trying to let you know that 

we appreciate everything that has been accomplished. But the 

problem that I have is our elders are passing away. And they are 

making their premonitions come true, their predictions and their 

comments. Before I left, I had a fellow councilman tell me about 

his aunt and his uncle, who just can’t get to that drilling. And they 

see it happening all around the reservation. 

So we are willing to try TERA. But like Chief Gray said, the jury 

is still out. What are they going to provide to the tribe, what trust 

responsibility are they going to give us? And then on the 638 concept, which is similar to a TERA but different, you would still need 

to have the area office sign off for Federal officials. So you are pretty much just preparing the paperwork and they are still signing off. 

So I guess in Federal lands, we understand there are a lot of 

issues. 

But when you have fee land right across the way, everything is 

going fine. And then you come to us and it stops. It is really tough, 

because a lot of these oil companies are turning their lease back. 

Three years have burned, four years have burned, and now they 

are coming to us and saying, do you want these? We can’t get the 

permit. 

Thank you, Senator Udall. 

Senator UDALL. Thank you very much. 

Let me thank the entire panel. I think all of you have as leaders 

been excellent advocates for your tribes and for your people. Thank 

you very much, and I yield back, Mr. Chairman. 

The CHAIRMAN. Senator Udall, thank you very much, and thanks 

for your continuing interest in these issues. I know that your State 

has an abiding interest in these issues as well. 

50 

Let me ask, if we can put the chart back up that shows the, and 

in many ways, this is a metaphor for the entire Country, that Indian land is treated different than other lands. And particularly 

when it comes to energy development, to have the Indian nations 

left behind in development means that they are denied the opportunity that comes with that development, the opportunity for the 

royalties and the revenue, but also for the jobs and so on. 

[The information referred to follows:] 

So this shows oil and gas wells that are being dug or have been 

dug on the Reservation. Frankly, it shows we have made a little 

progress, because it wasn’t very long ago that the map of the Indian reservation showed a big vast area of gray with very little energy activity. You will see that around the Reservation there are 

a lot of oil wells that have been drilled. Wells are now producing 

oil. So when the Chairman and his tribal council brought this to 

my attention, I immediately wondered why, why is this the case, 

how can this happen? If ever there is a need to go into the Bakken 

Formation and drill, you would think the most significant need is 

on the Indian reservation. The Bakken Formation exists throughout that reservation as it does north, south and west. 


1022b1.eps
51 

And what I discovered was a 49-step process, I believe it was 49 

steps by the Interior Department, with four separate agencies inside the Department that were required to give their individual 

stamp of approval. And if an oil company wanted to come on the 

reservation and get a permit to drill, it meant that it was going to 

take them much, much, much longer to get a permit if they ever 

did get a permit than going a mile and a half off the reservation 

and in five to seven days, just like that, getting a permit to drill. 

Now, that is unbelievable to me. So when I learned that, it has 

taken, I understand now, two years to get 24 wells drilled on the 

reservation. When I learned that, I met with the Interior Secretary, 

we put together an initiative called a virtual one-stop shop, tried 

to get the four agencies working together. And I think there has 

been some progress. But Chairman Levings, tell me, what more is 

necessary? Have they streamlined the 49 step process? Have they 

hired what they have promised to hire to make the one-stop shop 

work? Tell me what is necessary. 

Mr. LEVINGS. There are four posts that they have advertised. 

They filled one, but they didn’t fill it with an expert. They filled 

it with a manager, which I guess is okay, but we need an oil and 

gas expert. We borrowed one from the Denver office, Jeff Hunt, and 

he is great. We need about four or five of his capacities and abilities. 

But the three other posts aren’t filled. Then as soon as they are 

filled, he is going back to Denver and the one-stop shop. Dawn 

Charging has been hired, she means well, she is a tribal member, 

but she doesn’t have the oil and gas background. So she respectfully hears our words. 

Out of the Aberdeen area, they had a one-person show doing 

these permits for all these 40 companies. And it just wasn’t happening. So they reassigned him to do a programmatic document for 

Mandaree segment and west segment. But they put three new people on to do the permits themselves. So that changed things overnight. In a matter of two weeks, they did 22 permits. So that was 

a step in the right direction, and I commend Bob Middleton with 

the Washington, D.C. office and Mike Black from the area director’s office. But that was needed some time ago. 

What I think they need to do is detail in some people from Chief 

Gray’s area or the Billings office and get them in there to help on 

this effort, whether it is four, six or maybe more, just to get us to 

where we need to go. Because the winter is coming upon us. And 

if you recall last winter, Chairman Dorgan, it was tough in North 

Dakota. I don’t think we dug out until April, somewhere in there. 

So we have that issue of walkovers now. Walkovers aren’t going to 

happen when the snow hits, so we are going to have to wait. 

But as far as the initial progress, I think we are patient and we 

know that it is going to happen, it is going to take place. But those 

are some opportunities I think they can do. 

Within the Department itself, our words and our testimony are 

accurate. They transferred in, detailed in people who never worked 

in realty prior. And they were learning on the job. My words are 

true, because I did interview a couple of them, and they said, well, 

I got detailed in from Aberdeen. I never worked in permits before, 

I used to be in probate. Well, probate is over here and oil and gas 

52 

is over there. And respectfully I said, well, I will help to do the best 

I can to give you any insight. Then the realty officer, first post on 

oil and gas. And she is the one who is going and sitting side by 

side with my staff at these lectures and trainings. 

So it is the Bureau type of rules, I guess, on transfers and details. But they need to probably provide the best resumes versus, 

well, they are just a GS–9 and they are qualified, so send them up 

there. That was kind of the issue, Chairman. 

The CHAIRMAN. I don’t want you to be patient any more. I will, 

following this meeting today, be in touch with the BIA and try to 

understand from them, why is it representations were made about 

what they were going to do and why those positions haven’t been 

filled with qualified people with experience. It is not satisfactory to 

me to say, here is what we pledged to do to get this moving and 

then not to have them do it. There are so many broken promises. 

You don’t need more broken promises from the agencies that have 

told us explicitly, we will fix this. 

So tomorrow, we will be at those agencies to try to understand 

why it is you have been told that, here is the staffing level, we are 

going to get you people, and they don’t get you all the people you 

need, number one, and number two, the people they get you aren’t 

experienced. That is unsatisfactory to me. 

Mr. Gray? 

Mr. GRAY. Thank you, Chairman. 

The question that you identified that is going on at Three Affiliated is something that is going on across Indian Country. That is 

that we do need a concerted effort from the Administration to recruit and hire and retain qualified individuals with the expertise 

in the areas that they are asked to work in. 

When you talk about one-stop shop, I just want to throw out to 

you for your consideration to take a look at the Osage Agency, 

which has been in effect a one-stop shop for many years now. This 

one agency serves the dual functions that the BLM serves on other 

reservations, as well as MMS, as well as the trust responsibilities 

that are carried out through the BIA and OST. The sole purpose 

of really trying to accomplish a one-stop shop can be undermined 

simply by the fact that you have the wrong people in the right positions. 

With the limited funding that has been made available for recruitment and training and retaining these individuals to work in 

these fields, some of the areas in Indian Country are in the most 

remote areas of the United States. To recruit the best people that 

you can in the industry is going to be very difficult without some 

incentives. 

I would like you to consider that the agency, that BIA consider 

doing something like IHS does, of funding through a scholarship 

program that allows individuals to be able to work off their school 

loans on an Indian reservation working in that specific field. That 

might be one, that might be a longer term solution to an immediate 

problem that we have. 

But I think a lot of it stems from the one issue that I did bring 

up in my testimony, which had to do with the DOE position that 

after nine months, is still not filled. As you mentioned before, there 

are 49 steps, well, not only are there 49 steps just getting the 

53 

leads, but there is also multiple overlapping jurisdiction of different 

agencies, from the Fish and Wildlife Department to the EPA, to 

DOE, DOI. 

There are a variety of different agencies with acronyms overlapping that could impact the lease as well. If that position was filled 

and staffed and given the kind of director authority that the Energy Policy Act of 2005 actually envisioned, it might address some 

of these issues from a WASHINGTON level that could impact the 

local agencies around the Country. 

The CHAIRMAN. You are saying the Osage Agency works, functions, is a model. Is that staffed with BIA personnel, Interior personnel? 

Mr. GRAY. Yes, it is. And it has been operating that way for a 

number of years now. The hope is that we can actually use that 

as a model for other tribes to look at. I certainly invite the Committee to send a representative down there to check out the operations. It could prove to be worthwhile. 

The CHAIRMAN. Where is that located again? 

Mr. GRAY. Pawhuska, Oklahoma. 

The CHAIRMAN. Mr. Herrera? 

Mr. HERRERA. Yes, Chairman Dorgan, thank you very much. 

I would just like to also comment on the NEPA review and some 

of the troubles that the Southern Ute Tribe has gone through as 

well. On fee lands, just outside the reservation, and even within 

the reservation, the State actually allowed 80 acre spacing, where 

it was 160 acre spacing. So we got more wells on the same amount 

of land. 

In order for the tribe to do this, we have just actually got 

through the NEPA process that took two and a half years, and it 

actually took over a million dollars of our own money just to get 

this done. When it comes to the Bureau of Indian Affairs function, 

we actually have employed some of the ex-employees who are tribal 

members to do functions when it comes to realty and all the functions, when we are trying to drill locations. So those are funded by 

the tribe already. We haven’t had a superintendent up until recently, for the last five years. And in reality, there are only three 

people at this agency, where before you could go down there and 

probably see about 14, 20 people there. It is just understaffed. 

The CHAIRMAN. You haven’t had a superintendent for five years? 

Mr. HERRERA. Prior to this last, we just got one recently. And in 

closing, I think that in reality, I understand the trust responsibility 

from the Government. But we need to understand that if it is not 

going to be funded, we need to make sure that the roadblocks are 

taken out of the way, so that we can go ahead and do our business 

as we need to. It is imperative that we are able to get this stuff 

done because our tribal members are dying. They are in dire need. 

If the roadblocks are still there, we are not going to be able to do 

what we need to do to make sure that our lives and the lives of 

our children and children’s children are taken care of in the future, 

sir. 

The CHAIRMAN. The three items that we identified in the report, 

the concept paper, are antiquated laws and cumbersome regulations, we are talking about that; lack of tribal access to the transmission grid, and I would also include in that any conveyance grid, 

54 

of pipelines in the case of oil and natural gas; and then lack of 

available financing and incentives for investment by tribal energy 

projects, all of which we think are dilemmas that need to be addressed and all of which in some ways thwart full development. 

I don’t think any of us are suggesting just essentially, get rid of 

all of the 49 steps and let anybody do whatever they want at any 

moment. That is probably not possible and not advisable. But it is 

the case that we need to try to understand what is thwarting development and how do we address those challenges so that we have 

robust development on tribal lands. 

Mr. Sampson? 

Mr. SAMPSON. Thank you, Chairman Dorgan. I just wanted to 

make a comment. Before I came up here this afternoon, I made a 

stop down at the Office of Indian Energy and Economic Development and spoke with them about a project that the Yakama Nation 

has under review at the present time. I checked into their loan program to fund this project. I was informed by the gentleman there 

that they only have $100 million for the whole Nation there within 

their program for funding sources for fiscal year 2010. For our 

project alone would take half the whole budget for the United 

States, that we were proposing. I just can’t see that there is enough 

funding that should be shoveled toward that agency, of all agencies, to help us develop our resources here within our reservations. 

It is severely underfunded. 

The guaranteed loan program is fine. But then that allows the, 

requires the tribes to come up with the capital investments to come 

up with the big dollar projects that are out there to develop. 

So I think this program does need a good kick in the pants there 

to get it some fund toward the tribes at the reservation levels. We 

could probably see more projects being developed if they did have 

more funding. 

Thank you, Mr. Chairman. 

The CHAIRMAN. I think one of the common themes we hear 

across the Country is that on Indian lands, because they are different and unique, we have the requirements of so many different 

steps. I don’t think my State is unique, that if you are in my State, 

and wish to drill on private lands or even State lands, you will very 

quickly get a drilling permit. You file an application and pay a 

small fee and get a drilling permit in not very many days. 

That is not the case if you aspire to drill on the Indian reservations. We should find ways, it seems to me. My point is, I believe 

that is not the case just in North Dakota. I believe that is the case 

across America with respect to Indian lands. If that is the case, 

then I appreciate that there may be a model at the Osage Nation. 

But my guess is that at almost every reservation where there is the 

potential for substantial energy development we face the same 

myriad of steps and the same bureaucracy that moves very, very 

slowly. 

In Interior, I think in our State there are four different agencies 

of Interior that have to come to bear on these things. Each take 

their time. There seems to be no urgency on any of them. Then we 

get an agreement to do a one-stop shop, and you hire people that 

don’t really have experience. So then it takes a while for them to 

understand and learn and get trained. 

55 

That is just not satisfactory. We need to do much, much better. 

I think what I am going to do as a result of these discussions, 

I am going to ask Secretary Salazar if he will appoint one person 

in the Interior Department to work with this Committee, one person as a coordinator, representing the Secretary himself, to work 

with us to solve these problems and so that one person understands there is responsibility to get something done, and there is 

a time line to get something done. Otherwise, this will just go on 

forever. People on Indian lands that want to develop energy will 

continue to be frustrated. So we don’t want to walk into the future 

that way. We want to begin to solve problems. 

The purpose of this hearing really is to evaluate what, in the 

concept paper, can come from these discussions that could result in 

some legislation to move this along. I think some of the answers 

are in legislation. But I think some of the answers are as well just 

in administrative decisions to make agencies work the way we 

would expect them to work, with some dispatch, some coordination, 

so that you can work together to get something done. 

Mr. Levings? 

Mr. LEVINGS. Chairman Dorgan, the concept of partnering, the 

industry is with us, and we are with them. They wanted to accompany, one time, 15, 20 companies strong, and they said, we want 

to come there and fill that Committee room up with you, and I 

said, no, that is my job. And they are looking out for the allottees 

just as hard as I am and the tribe in general. 

Two, these expos we have had, whether it is a State expo with 

the oil producing counties, or it is the tribe expo or the Bureau of 

Indian Affairs expo, we all come together and we brainstorm. The 

distinction is huge. On Wednesday, I signed a lease for a company, 

we have ownership in fee lands as well. I signed a lease on a 

Wednesday, they pulled the drilling rig in on a Thursday. That is 

how quick it is. On one of our wells that is on trust land, we approved it in January of 2005, they pulled the rig in in April of 

2008. That is the big difference, Mr. Chairman. 

The CHAIRMAN. I think that describes it in stark detail. 

First of all, let me say I appreciate all four of you traveling some 

distance to be with us. Senator Barrasso and I, as a result of the 

concept paper, as well as our staffs, are trying to determine with 

this concept paper, what do we move forward. And having a hearing of this type is very helpful. I think it might be useful for us 

to take a look at the Osage Nation model, as you suggest. All of 

us believe everything that exists back home for all of us is a model. 

But I but you are right, that you have a good functioning system, 

and we want to take a look at that. 

It does, in many respects, no matter what the location, require 

skilled people with experience, and who also are determined to try 

to make something happen. The bureaucracy, I use that term advisedly, doesn’t always work that way. Bureaucracy means big organizations. There is corporate bureaucracy, there is Government 

bureaucracy. It is hard to get the bureaucracy to turn on a dime 

and to move and understand there is an urgency. 

But we want to try to at least substantially improve things as 

we go forward on energy development. It is in the Nation’s interest. 

We have an energy security need. We have a national security need 

56 

to develop energy. And it is also certainly in the interest of the 

First Americans who live on reservations that have great amounts 

of energy to contribute and whose citizens especially need the revenues that come from that energy and the jobs. It seems to me, if 

we can begin to streamline this and provide some solutions, it will 

be beneficial in a dozen different ways to this Country. 

Mr. Gray, do you have a final comment? 

Mr. GRAY. Yes. Just to add to your suggestion that possibly 

somebody from the Department of Interior is appointed to work directly with this Committee on this issue, I would just like to suggest that maybe you identify someone from the Department of Energy who could work directly with the Committee on this. 

The CHAIRMAN. That is a good suggestion. 

I thank you again, and this Committee is adjourned. 

[Whereupon, at 3:47 p.m., the Committee was adjourned.] 

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