Source: https://www.modrall.com/2017/12/20/indian-water-rights-settlements-issues-consideration-state-water-user-perspective/
Timestamp: 2019-04-23 07:55:54+00:00

Document:
Indian water rights settlements have played and will continue to play an important role in resolving conflict over shared water resources throughout the United States. Negotiation and implementation of these settlements has become increasingly challenging in the context of concerns over allocation of federal resources to settlements as well as in increased procedural and political hurdles. However, benefits of settlements generally continue to outweigh the costs of lengthy litigation and resulting acrimony. States, Tribes and local water users should continue to explore opportunities for settlement of Indian water rights claims in conjunction with federal efforts. Although each settlement will present unique issues for resolution, there are core issues common to all settlements which should be considered by all parties as they sit down at the table to negotiate and implement these important settlements. Recent experiences in Oklahoma in the context of the State of Oklahoma, Choctaw Nation and Chickasaw Nation Water Settlement indicate that resolution of these complex disputes will continue to assist as tools to resolve conflict over management and allocation of shared water resources in a variety of jurisdictions.
There are currently 36 Indian water rights settlements which have been entered into as between the federal government and Indian Tribes. The majority of these have received congressional approval. Most, but not all of the settlements to date have involved the relevant State as a settlement party and a large number have involved significant water users such as municipalities, irrigation districts and others with state law water rights. While sometimes contentious in and of themselves, settlements have played an important role in resolving conflicts nationwide over shared water resources. Despite the broad ranging geographic reach of these settlements and the different interests and issues which individual settlements sought to and did resolve, there are common underlying challenges and issues relevant and necessary to address in any Indian water rights settlement. These challenges and issues will remain regardless of any particular administration’s views or approach to settlements.
The federal government is an integral and necessary component of any individual tribal water settlement and critical to the ultimate settlement success. However, States, Tribes and local water users should seize opportunities to craft solutions to resolve tribal claims in the context of unique state, tribal and local issues. While the federal government and ultimately Congress must agree to the terms on which tribes and states have chosen to resolve claims, States and Tribes should not be shy about shaping settlements to address specific tribal claims which may be particular to the State or local area within which the claims arise. The need for proactive engagement of states and local stakeholders in efforts to resolve Indian water rights claims may be even more important in the current political climate. Each passing year has evinced growing resistance to funding Indian water rights settlements at the federal (congressional and administrative) as well as the state and local level. Water and tribal issues have not been identified as a priority for the new administration. The possible lack of priority coupled with Interior-wide hiring freezes and looming budget cuts, may prove to be additional obstacles on the federal end over the next four years with regard to Indian water rights settlements. State and local interests can and should play an important and constructive role in continued efforts to resolve disputes regarding Indian water rights claims.
Each settlement presents unique issues which must be addressed to allow successful resolution. However, there are also some common core issues which should be contemplated and addressed to ensure the success of any settlement. While taking different forms, these issues should be examined and addressed at the outset to the greatest extent possible.
Pursuant to the “Criteria and Procedures for Participation of the Federal Government in Negotiations for the Settlement of Indian Water Rights Claims” 55 Fed Reg. 9.223 (March 12, 1990)(Criteria and Procedures), it has been the stated policy of the federal government since 1990 to negotiate and settle, rather than litigate, Indian water rights claims. Despite varying approaches to and differing applications of the Criteria and Procedures since 1990, the policy of negotiated resolutions has remained relatively constant through a variety of administrations of both parties without question. However, the differing approaches to and application of the Criteria and Procedures can make it more or less difficult to settle the complex claims inherent in any Indian water rights settlement. To complicate matters, on the federal end as well as contributing to the uncertainty as to what States or water users can expect, on February 26, 2015 Congressman Rob Bishop (Utah) Chair of the House Natural Resources Committee authored a letter to the administration (Department of Justice and Department of Interior) setting forth congressional views regarding the Criteria and Procedures. (Bishop Letter) The Bishop Letter has been viewed as establishing directives the administration must follow prior to and throughout presentation of an Indian water rights settlement to the House Natural Resources Committee. The Bishop Letter establishes a process which relies on the 1990 Criteria and Procedures with particular emphasis on ensuring the financial aspects of any settlement are “fiscally responsible and justified in order to protect the American taxpayer and future Tribal needs.” Among other things, the Bishop Letter also directs that any settlement be final, that any legislation has been agreed to by all parties and that the administration set forth the legal claims being settled.
More recently, the Office of Management and Budget (OMB) issued a memorandum which asserts a greater role for OMB in the negotiation and substance of Indian water rights settlements than contemplated by the Criteria and Procedures. See “Review Process for Proposed Indian Water Rights Settlements”, June 23, 2016 (OMB Memorandum). The OMB Memorandum was issued without any consultation with Tribes or States and appears to be an effort to insert OMB into a role not appropriate for the agency’s more limited, albeit important role in evaluating the financial aspects of an Indian water right settlement. The Memorandum’s new requirements regarding OMB involvement fail to account for the complex legal, practical and policy issues that underlie any Indian water rights negotiations. Rather than ensuring OMB remains involved with regard to fiscal impacts and analysis of settlements, the Memorandum proposes OMB have some undefined role in federal negotiation positions and substantive claims settlement on an ongoing basis. The process of negotiation and settlement is already fraught with difficulty and the OMB Memorandum has created uncertainty and concerns on the part of both Tribes and States in the process of negotiating Indian Water Rights settlements or interested in commencing negotiations. Indeed, many advocate for withdrawal of the memorandum and/or amendments to the Criteria and Procedures which serve as the basis for the Memorandum as well as the Bishop Letter. The approach of the new administration to settlement versus litigation and specifically with regard to any changes to the Criteria and Procedures or the OMB memorandum will be important to watch.
Part of the critical path to success of any settlement is for each party, Tribe State, or local water user to clearly articulate their core principles in approaching and reaching a settlement. If there is clarity as to respective core principles, identification of the issues and flexibility and willingness to address them in new and innovative ways will be easier and more possible. These include allowing for innovative approaches to supply, jurisdiction and funding issues among other things. To work towards a successful settlement, the parties will need to work to identify issues which generally fall into four broad interrelated categories.
Unique state or local issues within which the claims arise. At the outset of any negotiation it is necessary to take a step back and identify and examine the critical local issues—hydrologic, legal and political— in which the claims are being resolved. Is it a system governed by prior appropriation or riparianism?; Is there interrelated ground and surface water and how is groundwater managed and administered?; Is water supply the limiting factor or is it one of variability?; What is the state of infrastructure necessary for water supply?; Is there a way to address local water supply issues and concerns in the context of resolution of Tribal claims?; Are there longstanding political or legal issues as between or among the State, Tribe(s) or local users which are not water related?
Technical issues. Understanding the hydrologic system within which the claims arise is always a critical issue and an important fundamental building block to ultimately achieve settlement. However, years can be lost battling about seemingly competing technical information. Moreover, claims of a lack of information or insufficient information can sometimes be used as a shield or excuse to thwart discussion of the difficult underlying legal or political issues. Accordingly, while good sufficient technical information is essential to solving resolving Indian water rights claims, beware the information battle. Resolve that technical information can continually be refined and you may never have “enough” information. Work instead to focus on what core information is necessary and find where agreement lies regarding that core information and use that to move forward.
Scope and impact of the claims to be resolved. What is the geographic scope of the claims to be resolved, what is the nature of the resource? (surface vs. ground, reliability, desired end uses); Are there allottee issues which will need to be addressed or incorporated into the settlement? Importantly, one must examine whether ancillary agreements will be necessary to effectuate and implement the desired settlement. Are there ESA claims which will require Section 7 consultation and associated agreements regarding reasonable and prudent measures or conservation measures? Will there local or State cost-sharing agreements be required?; Are there federal projects which can be used to facilitate settlement or conversely which present unique issues which must be addressed?
Political issues. It is important to examine at the outset whether there is local as well as State support for resolving the claims of the Tribe. While lack of support or a divergence of views within the State or local community does not signal that settlement should be forgone, it is important to understand the challenges which will present themselves in the long road that is negotiation, settlement and ultimately implementation. Not all of these issues can be foreseen, understood or forecast at the outset, but an understanding of the political forces at work throughout the process is essential. As part of this question it is important to understand what, if any, other political issues are at play as between the Tribe and the State or local water users.
Financial issues. The majority of Indian water rights settlements require significant federal investment. This is generally, but not always, due to longstanding neglect of the needs of Tribes with regard to water and infrastructure or in the more rural areas where many tribal claims manifest. Equally significant is that water supplies in the relevant region are often already over-allocated. Significant competing needs including endangered species, power generation, and municipal supplies often require amplification of existing supplies through importation of water or infrastructure to allow settlement of previously unquantified Tribal claims. This requires money. It is important to understand upfront that any individual settlement will almost never get all that is requested money-wise, or even what is actually needed. This requires serious consideration of creative approaches to both funding and resolutions. Where there is federal funding at any level, local and state cost shares are essential. Under the Criteria and Procedures 40% of the settlement cost for local cost share is considered minimally optimal. The OMB Memorandum and the Bishop process both place heavy emphasis on ensuring that the “benefits” of an Indian water rights settlement are “worth” the cost to taxpayers and that local and state contributions are satisfactory. However, measurement of the benefits and worth of individual settlements is often difficult as there is no uniform or standard measure and some of the benefits such as certainty of supply and harmonization of use of shared resource do not have a ready price tag.
Sometimes it seems obvious who should be at the table to effectuate a successful settlement but it is vital to evaluate whether those impacted significantly by the settlement or critical to its ultimate implementation are provided effective participation. With regard to the federal government, participation will be through the Department of Justice and Interior on the legal end. However, it is also critically important to identify the various parts of the federal family which may need to be involved at the legal, technical and policy end. Settlements encompassing federal projects need to be sure that the right people are involved from within the Bureau of Reclamation or the U.S. Army Corps of Engineers. Moreover, if endangered species are present, input from the U.S. Fish and Wildlife Service is essential. While federal negotiation teams appointed pursuant to the Criteria and Procedures often involve the relevant federal agency, this is not always the case and not every settlement has a federal negotiation team.
Some settlements do not necessitate the involvement of state water users while others would fail without the involvement of the key parties within a particular basin. Too often local water users are excluded from the settlement process which will ultimately have a significant impact within the basin which represents a shared water resource. Yet, in order to arrive at a settlement or even a framework, it is often necessary to limit the participation of entities other than the State, tribes or United States. Each circumstance should be carefully evaluated to ensure involvement of the right parties at the right time in any negotiation.
The corollary question becomes as to how to bind those who are not at the table once the settlement is complete. If the settlement is in the context of a general stream adjudication all water users are ultimately bound through a final decree. However, some settlements have arisen and opportunities exist to resolve Tribal claims absent a general stream adjudication. How to bind other water users in those circumstances to the extent necessary and how that is done become interesting and potentially difficult questions. The answer to these questions depends largely on the nature of the claims and how those are settled. States and Tribes should work together to find mechanisms of resolution short of litigation inclusive of general stream adjudications.
Increasingly, the federal “side” of an Indian water rights settlement often appears focused on the financial aspects. However, significant federal interests arise and need to be addressed and incorporated throughout the settlement process. While the involvement of the federal government in Indian water rights settlements is by virtue of the significant trust responsibility of the federal government to Indian tribes, federal and tribal interests are not always fully aligned through the course of a settlement.
Federal interests and goals for settlements should be identified early on in the process. Necessary for any federal administrative approval before a settlement can be reached are agreement regarding waivers of claims and the corollary retention of claims. Waivers will include both waivers of claims by the United States as trustee for the Tribe and waivers of claims by the Tribe vis-à-vis the federal government. In settlements in more recent years, the administration and Department of Justice has taken the position that waivers of claims and retentions must be consistent as to form and articulation. This approach can present challenges where there are unique claims which must be waived or retained. The approach has also proved inconsistent in itself as the effort for consistency can relate more to conforming to the last completed settlement as opposed to an overall strategic approach. Where there is no general stream adjudication within which claims are being settled, the settlement will also need to address the waiver of immunity of the United States as to enforcement and interpretation of the settlement agreement. The federal government will also play a critical role in working to formulate the approach to the settlement of allottee claims where that is necessary to effectuate a complete and final settlement.
Most settlements will require congressional approval to allow for complete and final settlements as to waivers of claims, waivers of immunity, allottee claims as well as the necessary federal funding required by most Indian water rights settlements. The Criteria and Procedures, Bishop Letter and OMB Memorandum, while directed to the administration, all require States and water users involved in settlements to work with their federal partners to formulate a cohesive congressional strategy through the course of the settlement process, or risk failure at this critical stage. Even with good planning however, one should expect at least two congressional sessions necessary for bill passage and be prepared to maintain flexibility for continued negotiation of terms and conditions throughout the approval process.
Indian water rights settlements are long and notoriously difficult paths. Reaching settlements themselves can be fraught with difficulties and obstacles, followed by sometimes years of efforts to secure the congressional approval and funding necessary to most settlements. Even after federal legislation however, most settlements require several years of continued efforts to ensure full implementation. Implementation can be broad and far ranging and will be dependent on the terms of individual settlements. Generally, implementation is centered on the “Conditions Precedent to Enforceability” of the settlement agreement, notably the waivers of claims of the tribe and the United States. Conditions precedent invariably include conformance of the settlement agreement to any changes made in the federal legislation, entry of decrees in the relevant stream adjudication, dismissal of relevant pending litigation, execution of the settlement agreement by the United States and execution of waivers by the United States and the tribe. Conditions precedent can also include appropriations, construction of water supply infrastructure or projects, execution of ancillary contracts for water supply or storage, and institution of tribal water codes or state rules relating to administration. Implementation or satisfaction of conditions precedent is often given insufficient weight in the throes of efforts to consummate a settlement and obtain the all-important congressional authorization. Attention should be paid in advance to ensure adequate time, resources and political will to see settlements to fruition through the implementation process.
Our paradigm for resolving Indian water rights is generally in the context of reference to existing reservations and the application of the Winters doctrine. Winters v. United States, 207 U.S. 564 (1908). While the doctrine continues to evolve (such as whether groundwater is part of a Winters claim, See Agua Caliente of Cahulla Indians v. Desert Water Agency et al. Case No. 15-55896 March 7, 2017 (9th Circuit)(groundwater is part of a reserved right to water), the doctrine has clear parameters and provides a long-standing legal basis for settlement. The claims of the Pueblos in New Mexico have proved difficult to settle in large part because the Pueblos’ claims to land and water do not neatly fall within the confines of the Winters doctrine (Pueblo lands are grant, not reservation based) and at least the federal district court in New Mexico has rejected Winters as the basis for Pueblo claims. See State of New Mexico v. Aamodt et al., 618 F. Supp. 993 (D.N.M. 1985). In Oklahoma, extant Tribes are also not situated on reservations at least in the traditional sense but generally inhabit historic treaty territories to which they were removed or otherwise confined at the time of Oklahoma was Indian Territory. The situation is similar east of Oklahoma where traditional western reservations and application of the Winters doctrine do not necessarily apply. In addition, as one moves east, the underpinnings of Winters are further called into question as one moves from water scarce regions, to regions with more abundant supplies and the law of riparianism rather than prior appropriation governs.
The State of Oklahoma, Chickasaw and Choctaw Water Settlement is unique in that it addresses the claims of tribes with no reservation but rather settles the claims of the two Nations in the “Settlement Area” which comprises the Nations’ historic treaty territories. Moreover, the settlement is in the context of a state water allocation system which is primarily based on prior appropriation for surface water with vestiges of the riparian doctrine adhered to in Oklahoma’s early years as a State. Groundwater is owned by the overlying landowner and allocated based on equal proportionate shares unless the State has established a maximum annual yield for the aquifer.
The settlement is not based on Winters or United States v. Winans, 1988 U.S. 37 (1905)(tribal claims to water based on treaties specifying hunting and fishing rights) and contains no specific quantification of water based on either theory. Rather, the settlement focused on the unique State, local and tribal concerns regarding access to and control of the water resource in twenty-two counties in southeastern Oklahoma. In focusing on the unique history of the State of Oklahoma, the Choctaw and Chickasaw Nations, and the goals of the respective parties, the settlement was able to resolve the concerns and claims of the Nations, the State and the City of Oklahoma City, the major municipality in the State and the longstanding conflict over water resources in southeastern Oklahoma.
The case formally began in 2011 with litigation filed by the two Nations, but conflict over the water resources as among the Nations and the State had been brewing for over a decade. The case filed by the tribes, Chickasaw Nation and Choctaw Nation of Oklahoma v. Governor Mary Fallin et al., CIV 11-927 (W.D. Okla. 2011) claimed the Nations had regulatory control and ownership of all the water in twenty-two counties in southeastern Oklahoma based on historic treaties. While those treaties had been generally abrogated by congress in paving the way for Oklahoma statehood, the Nations claimed the water in their respective former treaty territories remained owned and subject to regulation by the Nations and that the State had no jurisdiction over the water in twenty-two counties. The Nations joined as defendants, the Governor of the State of Oklahoma, the Oklahoma Water Resources Board (OWRB) and the City of Oklahoma City which had a pending application with the OWRB to appropriate surface water from the Kiamichi River a significant river in the disputed area. The application by the City was a request for an inter-basin transfer to transport that water via pipeline to Oklahoma City in central Oklahoma.
In response to the Nations’ suit, among other things, the State filed the first ever general stream adjudication in the State in the Oklahoma Supreme Court joining, among other parties, the United States as trustee for the Nations, the Bureau of Reclamation, and U.S. Army Corps of Engineers which had significant facilities and projects in the region. The United States removed the case to federal district court where it was assigned to the same Judge presiding over the Nations’ case. After litigating for almost a year, the State, the Nations and the City entered into concerted negotiations for settlement of both lawsuits and both cases were stayed at the request of the parties.
The United States was not a formal party to the settlement negotiations as an initial matter and a formal assessment was not conducted nor a negotiation team appointed as normally provided for under the Criteria and Procedures. However, significant federal involvement occurred from the outset both at the Interior level which assigned an informal negotiation team as well as significant interface with the Department of Justice as a result of the filed litigation. In this instance, given the unique claims of the Tribes, and complexities of the needs and goals of the State of Oklahoma, the federal government was not at the settlement table during the formative stages of settlement negotiations. It was necessary for the State and Tribes to work together to work through and understand where there was mutuality which could serve as a basis for a settlement path. Here, that was something more readily accomplished without a specific federal presence at the table. The Nations and the State kept both Interior and Justice informed of progress and the general path of negotiations but due to a federal court order regarding confidentiality, the State and Nations were not able to share the specifics of the settlement until the confidentiality order was amended to add the federal government after three years of negotiations.
The challenges began at the early stages of the negotiations—the first struggle was for the parties to clearly define their respective goals. The State’s primary goals were clear—continued unified administration and regulation by the State, protection of existing uses and a firm water supply for Oklahoma City’s future. As part of ensuring Oklahoma City’s future water supply, the State also required that its storage interest in Sardis Lake, a U.S. Army Corps of Engineers reservoir, be transferred to the City along with the federal debt attendant to that storage. 2The Nations’ goals ultimately were to protect the water resources of their historic treaty territories, and as part of that to play a role in significant movements of water within what became the “Settlement Area” including movement of water out of the State. The settlement has several components which can generally be broken down into (1) water supply for the City of Oklahoma City; (2) resolution of the Nations’ claims with regard to regulatory rights and control of the water resources in the Settlement Area; and (3) resolution of the Nations’ claims with regard to their respective water uses.
With regard to securing a firm water supply to the City, after battling for over a year with regard to the appropriate approach to technical analysis and information, the parties were able to agree on a hydrologic model for the Kiamichi Basin. Based on that model, conditions were negotiated which allow the City to store, release and appropriate water from the Kiamichi Basin while at the same time protecting lake levels in Sardis Lake, and divert water from the Kiamichi River with a 50 cfs bypass requirement. Sardis Lake is an important recreational amenity to both the State and the Nations and has important traditional and cultural significance for the Choctaw Nation. Similarly, the Kiamichi River itself is an important amenity in southeastern Oklahoma to both the State and the Nations and the home to an endangered mussel. Establishing flow requirements in the stream relating to the City’s appropriation allowed protection of these mutual interests while at the same time addressed federal issues relating to endangered species.
With regard to the water use of the Nations, the settlement resolves existing uses and recognizes a process for development of additional uses if needed. The existing uses of the Nations were identified and recognized in the Settlement Agreement and can continue at their current level and current location. All existing uses are groundwater. Any changes to points of diversion and places of use must be undertaken according to a specified process if the changes are on trust lands. If those uses move off of trust lands, state law parameters and procedures apply. Similarly, the Nations can continue to develop uses of water off of trust lands in accordance with State law. Future development on trust lands with regard to groundwater must follow a specified process and is limited to amounts based on state law which recognizes ownership of groundwater and allows development of equal proportionate shares or maximum annual yields. Any development of surface water is limited to riparian trust lands and at a capped amount of 500 acre-feet per hydrologic basin.
The Settlement also resolves allotee claims unless and until an allottee makes an affirmative decision to apply for additional rights to water under federal law by filing an action in federal court for a determination of alleged federal rights. Any determination by the federal court is final as to the allotee rights and is in lieu of any right provided by the settlement agreement. The OWRB administers and enforces all rights of use on allotments.
The settlement parties also had to struggle with the fact that there was not a general stream adjudication within which the claims were being resolved. Accordingly, issues of enforceability and waivers of immunity had to be explicitly addressed.
With regard to the ingredients necessary for a settlement, the settlement struggled with all of those issues and more. Ultimately, what was most significant was resolving the technical issues early on and moving on to find the mutual goals of protecting the water resource and providing certainty of use and administration to both existing and future users of a common resource. While the State remains the regulator of the water resource and is exclusively responsible for permitting, allocation and administration, within that framework there is a role for the Nations in their historic treaty territory and a security of supply for their respective current and future uses.
The Settlement has its own website www.waterunityok.org.
1The WINN Act also included approvals for water rights settlements for the Blackfeet Nation of Montana and the Pechanga Band of Luiseno Mission Indians.
2A judgment was entered against the State in 2009 with regard to past due amounts and future payments based on a 1974 contract. United States v. State of Oklahoma, CIV 98-00521 (N.D. Ok.). The settlement and federal legislation contemplate modification of that order.

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