Indian Energy Development: Additional Actions by Federal Agencies Are Needed to Overcome Factors Hindering Development
Released: 2016-11-17T00:00:00

Letter

Background

The U.S. Census Bureau reported in 2013 that American Indians and Alaska Natives were almost twice as likely to live in poverty as the rest of the population. A 2014 Interior report estimated that between 43 and 47 percent of American Indian families in South Dakota earned incomes below the poverty line, compared with a national average of about 23 percent for all Native American families. In addition, according to DOE documents, Indian communities are more likely to live without access to electricity and pay some of the highest energy rates in the country— hindering economic development and limiting the ability of tribes to provide their members with basic needs, such as water and wastewater services and adequate health care. Considerable energy resources, including domestic mineral resources such as oil, gas, and coal, and resources with significant potential for renewable energy development, including wind, solar, hydroelectric power, geothermal, and biomass, exist throughout Indian country. Tribes may seek opportunities to use these resources as an option to create economic benefits that provide revenue for government operations and social service programs, create high- quality jobs, and offset power costs by increasing access to reliable and affordable energy for tribal buildings and individual homes. For instance, in fiscal year 2015, the development of Indian-owned oil and gas resources generated more than $1 billion in revenue for tribes and individual Indian mineral owners, according to Interior, making oil and gas resources one of the largest revenue generators in Indian country. In addition, tribes are taking advantage of renewable energy sources and developing projects that range from facility- and community-scale production, such as rooftop solar panels or a wind turbine to power a community center, to utility-scale production of hundreds of megawatts of electricity (see fig. 1).

However, the development of Indian energy resources can be a complex process involving a range of stakeholders, including federal, tribal, and state agencies. The specific role of federal agencies can vary on the basis of multiple factors, such as the type of resource, location of development, scale of development, ownership of the resource, and Indian tribe involved. Figure 2 shows various roles federal agencies may have in the development of Indian energy resources.

A short description of the agencies’ roles follows.

Resource Identification. To develop energy resources, developers and operators must locate a suitable resource. To locate potential oil and gas resources, most operators use seismic methods of exploration. For renewable projects, developers conduct a feasibility assessment to evaluate the potential of the resource for development and determine the viability of the project, which may include evaluating market demand for power and financing opportunities. Both IEED and IE help tribes identify resource potential. For example, according to IE data, IE provided a tribe $210,000 in 2012 to identify available solar and biomass energy resources, characterize solar and biomass energy technologies, and analyze the technical and potential economic viability of projects.

Technical and financial assistance. IE and IEED manage the federal government’s financial and technical assistance programs dedicated to Indian energy development. IE provides federally recognized tribes and tribal entities financial and technical assistance to promote Indian energy development and efficiency, reduce or stabilize energy costs, and bring electrical power and service to tribal communities and the homes of tribal members. For example, in 2015, IE awarded technical assistance to an intertribal corporation for a survey of wind resources, a survey of transmission and environmental constraints, and market analysis for 16 potential wind turbine deployment sites. According to a DOE report, IE provided $48 million to assist more than 180 tribal energy projects from 2002 through 2014. IE also offers education through webinars, forums, and workshops. IEED serves tribes and their members by providing technical and financial assistance for the exploration, development, and management of tribal energy resources. According to IEED officials, IEED provided about $52 million to assist 340 tribal energy projects from 2002 through 2015. According to its data, IEED is assisting a tribal member to develop a 5,000-acre solar project by helping secure transmission line access with potential right-of-way landowners, and by meeting with county commissioners to gain support for the project. In some instances, both IE and IEED provide assistance for a project. For example, IE and IEED coordinated to help a tribal solar project. IEED provided an engineering design grant, and IE provided an installation grant and technical assistance.

For the past 6 years, IEED has also provided assistance on an as-needed basis to BIA agency offices by assigning staff for a period of time— generally a year or longer—to perform such tasks as organizing oil and gas records, clearing backlogs of energy-related documents, reviewing leases, and helping BIA agencies fulfill requirements under the National Environmental Policy Act (NEPA). For instance, according to a BIA official, IEED helped a BIA agency office by conducting 1,584 NEPA and right-of-way compliance inspections for energy-related activities involving oil and gas well pads, access roads, and pipelines. In another example, IEED helped a BIA agency office by reviewing environmental documents and conducting site surveys for 77 proposed oil and gas well pads.

Other federal agencies, including USDA, HUD, Commerce’s Economic Development Administration, and Treasury, can also provide financial assistance to tribes to explore and develop their energy resources. For example, according to its data, USDA awarded a $500,000 grant through its Rural Energy for America Program in fiscal year 2015 to a tribal entity seeking to develop a hydroelectric project. Also, HUD data shows that in fiscal year 2015 a tribe used funds provided through HUD’s block grant program to extend transmission lines to communities that lack basic electrical service.

Regulate. Multiple federal agencies have a regulatory role associated with Indian energy development. For example, BIA approves seismic exploration permits for operators to identify oil and gas resources, maintains surface and mineral ownership records, identifies and verifies ownership of land and resources, and reviews and approves a number of energy-related documents—such as surface leases, mineral leases for the right to drill for oil and gas resources, and right-of-way agreements. In addition, BLM issues drilling permits to operators developing Indian oil and gas resources after receiving BIA concurrence to approve the permits. Further, EPA issues permits for air emissions that may be required for some oil and gas development, and FWS issues permits for incidental deaths of certain wildlife species, which may be needed for a wind project. If energy development affects navigable waters, the U.S. Army Corps of Engineers may need to issue a permit.

Provide transmission access assistance. Utility-scale renewable energy projects need to connect to the electric grid to transmit power generated from the project, along transmission lines, to a destination. DOE’s Western Area Power Administration, along with other power administration agencies, is responsible for marketing and transmitting electricity across the United States and can help tribes to better understand transmission capacity, identify options for accessing available capacity on transmission lines, and assist with interconnection requirements. For example, according to officials from the Western Area Power Administration, it partnered with a tribal utility authority to resolve transmission congestion affecting a proposed 27-megawatt utility-scale solar project.

Purchase power. To be economically feasible, utility-scale renewable energy projects need a customer to purchase their power. The federal government is the nation’s largest energy consumer. In fiscal year 2013, the government spent about $6.8 billion on energy for over 3.1 billion square feet of buildings and facilities—an area about the size of 50,000 football fields. GSA has general statutory authority to enter into utility services contracts of up to 10 years for all federal agencies. GSA has delegated the authority to enter into contracts for public utility services to the Department of Defense (DOD) and to DOE for procurements by those agencies. The Energy Policy Act of 2005 encourages federal agencies to purchase electricity, energy products, and by-products from tribal entities. Specifically, the act includes a provision authorizing federal agencies to give preference to a tribe or tribal enterprise when purchasing electricity or any other energy or energy by-product as long as federal agencies do not pay more than the prevailing market prices or obtain less than prevailing market terms and conditions.

White House Council on Native American Affairs Energy Subgroup

The Council was established by executive order in June 2013. The executive order calls for the Secretary of the Interior to lead the Council, the Council to meet at least three times per year, and Interior to provide funding and administrative support to the Council. According to an Interior document, the Council will improve efficiencies by coordinating work across the federal government and use an “all-of-government approach” to find solutions that address tribal needs. To accomplish its goals, the Council includes five subgroups—(1) energy; (2) health; (3) education; (4) economic development and infrastructure; and (5) environment, climate change, and natural resources—to discuss current initiatives and identify interagency solutions. The Energy Subgroup was formed in November 2013 with the Secretaries of Energy and the Interior as co-chairs. In May 2014, the Energy Subgroup identified nine additional federal agencies that should be included as participants and established policy goals for the Subgroup that, if accomplished, may help to overcome some of the factors that we previously identified as hindering Indian energy development. For example, in June 2015, we reported that tribes’ limited access to capital had hindered development. One of the Energy Subgroup’s goals is to evaluate, align and coordinate financial and technical assistance programs to leverage agency resources, funding, and expertise. Similarly, in June 2015, we found that the development of Indian energy resources is sometimes governed by multiple federal, tribal, and, in certain cases, state agencies and can involve significantly more steps, cost more, and take more time than the development of private and state resources. One of the Energy Subgroup’s goals is to evaluate opportunities to streamline and accelerate regulatory processes.

According to DOE and Interior officials, since May 2014, the federal agencies that formed the Energy Subgroup have taken the following actions: IE and IEED signed a memorandum of understanding in June 2016 as a format for collaboration between the two agencies; IE and IEED began to meet regularly in August 2015 to discuss projects involving both agencies and grant release dates, among other things; IE, with input from numerous other agencies, developed a web-based tool that provides information about grant, loan, and technical assistance programs available to support tribal energy projects; IE hosted events to encourage tribal engagement, such as the September 2015 National Tribal Energy Summit: A Path to Economic Sovereignty; and IE, Interior, USDA, GSA, DOD, and Treasury convened a meeting to discuss opportunities to provide technical and financial assistance to a planned 1-gigawatt wind and transmission infrastructure project.

Indian Energy Service Center

In response to tribal requests for increased coordination and more efficient management of their resources from the numerous regulatory federal agencies involved with Indian energy development, in 2014, Interior took initial steps to form a new office, the Service Center, composed of staff from four Interior agencies—BIA, BLM, ONRR, and OST—with BIA as the lead agency. BIA’s fiscal year 2016 budget included $4.5 million to form the Service Center in Lakewood, Colorado. According to Interior’s fiscal year 2016 budget justification, the Service Center is intended to, among other things, help expedite the leasing and permitting processes associated with Indian energy development. Among its accomplishments, the Service Center has (1) developed a memorandum of understanding among BIA, BLM, ONRR, and OST outlining the management and operation of the Service Center; (2) developed and conducted a training course on oil and gas development standard operating procedures for 462 Interior employees at eight locations across the country; and (3) hired several positions, including a Director and Deputy Director.

The Effectiveness of the Energy Subgroup and Service Center in Helping Overcome Factors Hindering Indian Energy Development May Be Limited by Several Factors

The Energy Subgroup Has Not Fully Incorporated Leading Practices for Collaboration, Which May Limit Its Effectiveness

The Energy Subgroup has not fully incorporated leading practices that can help agencies enhance and sustain collaborative efforts, which may limit its effectiveness in addressing long-standing factors that hinder Indian energy development. Our prior work on issues that cut across multiple agencies, as Indian energy development does, has shown that collaborative approaches can increase the effectiveness of federal efforts. Our prior work has also found that agencies face numerous challenges in their efforts to collaborate. To overcome differences in agency missions, cultures, and established ways of doing business, collaborative efforts, such as the Energy Subgroup, can use leading practices that have been shown to enhance and sustain these efforts. Specifically, in September 2012, we identified sustained leadership, dedicated resources and staff, and active participation of all relevant stakeholders, among other things, as leading practices for effective collaboration. Specific leading practices the Energy Subgroup has not fully incorporated in its implementation efforts following.

Sustained leadership is uncertain. DOE has not designated a career employee of the federal government to serve as its co-chair of the Energy Subgroup. Instead, DOE designated an appointed official to serve as the co-chair, and that individual may not remain in the position with the upcoming presidential transition. According to agency officials, their focus has been to complete more time-sensitive tasks, and selecting a long- term co-chair has not been a priority. Similarly, Interior originally designated an appointed official to serve as its co-chair of the Energy Subgroup, but in August 2016 Interior designated a senior-level career employee of the federal government to serve as co-chair, according to Interior officials. Interior officials also cited higher priorities as a reason for not identifying a career employee sooner, but these officials told us that the upcoming presidential transition increased the urgency to identify a long-term leader. The Executive Order establishing the Council allows for senior-level officials to perform Council duties, which may include either appointed or career employees. Our prior work has shown that turnover of political leadership in the federal government has often made it difficult to sustain attention to complete needed changes. Our prior work has also shown that transitions and frequent changes in leadership weakened the effectiveness of a collaborative effort and that a lack of leadership further challenges an organization’s ability to function effectively and to sustain focus on key initiatives. Designating a senior-level career employee to lead the Subgroup can provide some assurance that leadership will remain consistent beyond this administration.

Collaborating agencies dedicated few resources and have not identified additional resources needed. Federal agencies have dedicated few staff and financial resources to the Energy Subgroup, have not identified the resources needed to accomplish its goals, and do not have an agreed-upon funding model. Our prior work has shown that collaborating mechanisms should identify the staff and financial resources needed to initiate and sustain their collaborative effort. According to DOE, Interior, and USDA officials, the Energy Subgroup has been staffed on an “other duties as assigned” basis since its creation in November 2013. These officials said that this staffing model, which was also used by the other subgroups, makes it difficult to ensure continued participation by each federal agency because of competing demands for staff and resources. In 2015, more than 2 years after the Council was established, Interior hired a fulltime Executive Director—the only dedicated Council staff—to manage activities of the Council and all subgroups. Beyond the Executive Director position, participating agencies have not dedicated or identified future financial resources for the Energy Subgroup. A few federal officials told us the effectiveness of the Subgroup in accomplishing tasks is limited without dedicated resources. For instance, federal officials told us that the Energy Subgroup has not developed a 5- year strategic plan because no federal entity has dedicated the resources for key planning activities, such as a facilitated planning session that can define and articulate common outcomes. The executive order establishing the Council directs Interior to provide funding and support for the Council. However, according to Interior officials, dedicating resources to the Energy Subgroup would take away from other programs and services that directly support tribes and their activities.

Without dedicated resources, key activities completed to date are generally the result of individual federal agencies that voluntarily identified and applied their own budgetary resources to specific work activities. For example, DOE volunteered to use its own financial and information technology resources to develop a web-based tool that provides information about grant, loan, and technical assistance programs available to support tribal energy projects. According to a DOE official, the department voluntarily applied these resources because senior leadership determined the web-based tool was an important information source that could help tribes to identify federal financial assistance.

Our prior work has shown it is important for collaborative mechanisms to identify and leverage sufficient funding to accomplish their objectives and that funding models can vary. In some instances, specific congressional authority or dedicated funding from Congress may be used for the interagency funding for collaborative mechanisms. In other instances, we found a collaborative mechanism can be supported by all participating agencies contributing funds as well as in-kind support. Identifying resources needed to accomplish its goals and establishing a funding model agreed upon by participating agencies may provide opportunities for the Energy Subgroup. If the Energy Subgroup does not identify resources and a funding model, it is unclear to what extent the Energy Subgroup’s collaborative efforts can be effectively sustained to accomplish its stated policy goals.

The Energy Subgroup has not documented how participating agencies will collaborate. Our prior work found that agencies that articulate their agreements in formal documents strengthen their commitment to working collaboratively. A formal written agreement that includes goals, actions, responsible agencies, and time frames may be a tool to enhance and sustain collaboration. According to federal officials, the Energy Subgroup did not develop formal documentation because developing such documentation would have taken time and resources away from completing work deliverables. However, the lack of a formal agreement may have limited collaboration and involvement of some participating agencies. For example, federal officials told us that numerous Energy Subgroup agencies were actively involved in the effort to develop the web-based tool mentioned above but that after its completion there has been less collaboration between the various federal because there was no longer a clear reason to work together. The Council, including the Energy Subgroup, was established to improve efficiencies by coordinating work across the federal government and using an “all-of-government approach” to find solutions that address tribal needs. However, most of the activities completed to date have been the result of collaboration between only IE and IEED—the only two agencies focused exclusively on Indian energy and also the only two that have a documented agreement to collaborate. The achievements of the Subgroup do not reflect the efforts of the other nine federal agencies that are its members. Without documenting how all members in the Subgroup are expected to collaborate, it is unclear how participating agencies will organize their individual and joint activities to address the factors that hinder Indian energy development.

BIA Did Not Fully Incorporate Leading Practices or Adhere to Agency Guidance in Forming the Service Center, Which May Limit Its Potential to Overcome Factors That Hinder Indian Energy Development

BIA, the lead agency responsible for forming the Service Center, did not follow some leading practices or adhere to agency guidance during early stages of developing the Service Center—which may impact its effectiveness in helping overcome the factors that have hindered Indian energy development. An interagency plan created in response to Executive Order 13604, Interior’s Departmental Manual, and our prior work offer leading practices that have been shown to enhance the effectiveness of collaborative efforts, improve permitting, and increase the likelihood of success for organizational change. These practices include (1) creation of a lead agency or single point of contact to coordinate regulatory responsibilities by multiple agencies, (2) involvement by and active participation with all relevant stakeholders, and (3) clear identification and documentation of the rationale of key decisions. Specific leading practices that BIA did not fully incorporate when implementing the Service Center follow.

The Service Center has not been formed as a center point of collaboration for all regulatory agencies involved with energy development. In June 2015, we reported that the added complexity of the federal process, which can include multiple regulatory agencies, prevents many developers from pursuing Indian energy resources for development. Interior has recognized the need for collaboration in the regulatory process and described the Service Center as a center point of collaboration for permitting that will break down barriers between federal agencies. In addition, the memorandum of understanding establishing the Service Center states that it will serve as a center point for collaboration with other federal departments for expediting oil and gas development and as a point of contact for other agencies to resolve development issues. The Service Center may increase collaboration between BIA and BLM on some permitting requirements associated with oil and gas development. This is because, according to BIA officials, only entities that participate in the Indian Energy and Minerals Steering Committee—BIA, BLM, ONRR, and OST—were included in the Service Center. According to BIA officials, no other federal agencies were included because of concerns that including them would delay establishing the Service Center. BIA has neither included a regulatory agency within Interior, FWS, as a partner in the Service Center nor identified opportunities to incorporate other regulatory agencies outside of Interior, such as EPA, USDA, and the Army Corps of Engineers, as partners. As a result, the Service Center has not been formed as the center point to collaborate with all federal regulatory partners generally involved with energy development nor is it a single point of contact for permitting requirements. According to a tribal chairman, issues raised by FWS often create significant delays in permit approvals, and Interior’s failure to include FWS as part of the Service Center is a great error. Similarly, we reported in June 2015 that delays in the regulatory review and approval process can result in lost revenue and missed development opportunities.

Our prior work has shown that having a lead agency for permitting is a management practice that helps increase efficiencies for the permitting process. In addition, the Quadrennial Energy Review Task Force recommended that, when possible, federal agencies should co-locate dedicated cross-disciplinary energy infrastructure teams that consist of environmental review and permitting staff from multiple federal agencies. By not serving as a central point of contact or lead agency, the Service Center will be limited in its ability to improve efficiencies in the federal regulatory process to only those activities that can benefit from increased coordination between BIA and BLM.

BIA did not involve key stakeholders in the development of the Service Center. Interior’s fiscal year 2016 budget justification stated that BIA was working with DOE to develop and implement the Service Center and leverage and coordinate with DOE-funded programs to provide a full suite of energy development-related services to tribes. Further, BIA guidance states that it will seek the participation of agencies with special expertise regarding proposed actions. However, BIA did not include DOE in a participatory, advisory, or oversight role in the development of the Service Center. Further, although IEED developed the initial concept and proposal for the Service Center, BIA did not include IEED in the memorandum of understanding establishing the Service Center. Our prior work has shown that involvement by all relevant stakeholders improves the likelihood of success of interagency collaboration. DOE and IEED possess significant energy expertise. By excluding these agencies from the development and implementation of the Service Center effort, BIA has missed an opportunity to incorporate their expertise into its efforts.

Moreover, BIA did not effectively involve employees to obtain their ideas and gain their ownership for the transformation associated with development of the Service Center—a leading practice for effective organizational change. Most of the BIA agency officials we met with told us they were not aware of implementation plans for the Service Center or its intended purpose. BIA identified its agency offices as the primary customers of the Service Center, yet BIA did not request their ideas or thoughts or identify potential employee concerns. Several BIA and tribal officials said they are concerned that the creation of a new office (the Service Center) may add another layer of bureaucracy to the process of reviewing and approving energy-related documents. We have previously reported that, as a leading practice, successful change initiatives include employee involvement to help create the opportunity to increase employees’ understanding and acceptance of organizational goals and objectives, and gain ownership for the changes that are occurring in the organization. Such involvement strengthens the transformation process by allowing employees to share their experiences and shape policies. By not involving its employees in the development of the Service Center, BIA is missing an important opportunity to ensure the success of the changes that it hopes to achieve.

BIA did not document its basis for key decisions. The process BIA followed to develop the Service Center and the basis for key decisions it made are unclear because BIA did not document the rationale for key management decisions or the alternatives considered. According to Interior’s Departmental Manual, agencies that propose a new office are to document the rationale for selecting the proposed organizational structure and to consider whether the new office contributes to fragmentation of the organization. Our prior work has shown that effective organizational change is based on a clearly presented business-case or cost-benefit analysis and grounded in accurate and reliable data, both of which can show stakeholders why a particular initiative and alternatives are being considered. BIA officials said they did not document the basis for key decisions because they were not aware of the requirement. In addition, a few Interior officials said that BIA did not present alternatives to the full Indian Energy and Minerals Steering Committee, even though it was making decisions about the structure and placement of the Service Center. Without documentation to justify the rationale behind key management decisions, it is unclear if the Service Center, as currently designed, is the best way to address the identified problem. Further, several tribal organizations and tribal leaders made recommendations related to the creation of the Service Center that are not currently reflected in BIA’s implementation of the Service Center. For example, the Coalition of Large Tribes Resolution calls for the Service Center to be the central location for permit review and approval support for Indian energy development. Without documentation of alternatives considered or key management decisions, it is unclear whether these requests were appropriately considered. Our prior work has shown that fixing the wrong problems, or even worse, fixing the right problems poorly, could cause more harm than good.

BIA Has Not Incorporated Key Workforce Management Practices

In June 2015, we reported that BIA’s long-standing workforce challenges, such as inadequate staff resources and staff at some offices without the skills needed to effectively review energy-related documents, were also factors hindering Indian energy development. In this review, we found that BIA also has high vacancy rates at some agency offices, and it has not conducted key workforce planning activities that may be further contributing to its long-standing workforce challenges. Federal internal control standards, Office of Personnel Management standards, and our prior work identify standards or leading practices for effective workforce management. The standards and leading practices include the following: (1) possessing and maintaining staff with a level of competence that allows them to accomplish their assigned duties; (2) identifying the key skills and competencies the workforce needs to achieve current and future agency goals and missions, assessing any skills gaps, and monitoring progress towards addressing gaps; and (3) conducting resource planning to determine the appropriate geographic and organizational deployment to support goals and strategies. BIA has not taken steps to provide reasonable assurance it has staff with the skills needed to accomplish their assigned duties and has not conducted workforce planning activities consistent with these standards and leading practices.

Some BIA offices have high vacancy rates and may not have staff with the level of competence that allows them to review some energy development documents. We found that some BIA offices have high vacancy rates for key energy development positions, and some offices reported not having staff with key skills to review energy-related documents. For example, according to data we collected from 17 BIA agency offices between November 2015 and January 2016, vacancy rates ranged from less than 1 percent to 69 percent in those offices. Vacancy rates for the realty position—a key position to process leases and other energy-related documents—ranged from no vacancies in five offices to 55 percent in one office. In some cases, these vacancies have been long-standing. For example, at the BIA Uintah and Ouray Agency, located in Utah, two of the six vacant realty positions have been vacant since September 2014. According to BIA officials, the high vacancy rates can be generally attributed to a number of factors, including: employee early-out and buy-out retirements in 2013, difficulties hiring qualified staff to work in geographically remote locations, and staff transfers to other positions. For example, several realty positions in BIA agency offices were vacated because staff transferred to positions in BIA’s Land Buy- Back Program. According to BIA officials, as of May 2016, the Land Buy-Back Program had hired 15 realty staff, 12 whom were from BIA regions and agency offices.

In addition to high vacancy rates at some offices, some BIA agency and regional offices may lack the expertise needed to review and approve energy-related documents. For example, BIA agency officials in an area where tribes are considering developing wind farms told us that they would not feel comfortable approving proposed wind leases because their staff do not have the expertise to review such proposals. Consequently, these officials told us that they would send a proposed wind lease to higher ranking officials in the regional office for review. Similarly, an official from the regional office stated that it does not have the required expertise and would forward such a proposal to senior officials in Interior’s Office of the Solicitor. The Director of BIA told us that BIA agency offices generally do not have the expertise to help tribes with solar and wind development because it is rare that such skills are needed. In another example, a BIA agency office identified the need for a petroleum engineer to conduct technical reviews of oil and gas documents in a timely manner. However, the office has been unable to hire a petroleum engineer because it cannot compete with private industry salaries. According to BIA officials, additional staff resources and key skills related to energy development will be provided through the Service Center, once it is fully implemented.

BIA has not identified key skills needed or skill gaps. The extent to which BIA does not have key skills throughout the bureau is unknown because BIA has not identified the key skills it needs and the extent to which it has skill gaps. BIA officials said that a skill gap assessment is not needed at this time because of the additional staff being hired through the Service Center. However, without key information on its workforce, as called for by Office of Personnel Management standards and our prior work, the agency risks hiring personnel that do not fill critical gaps, and the extent to which the Service Center will be able to address these gaps is unknown at this time. A BIA official also told us that in August 2015, the Assistant Secretary for Indian Affairs contracted with a consultant to develop a strategic workforce plan for BIA and the Bureau of Indian Education. However, according to a BIA official, the Bureau of Indian Education and BIA management are the primary focus of the work, and the resulting plan will not include agency offices, the level at which tribes generally interact with BIA for energy-related activities.

BIA does not have a documented process to provide reasonable assurance that workforce resources are appropriately deployed in the organization and align with goals. According to several BIA and tribal officials, the workforce composition of agency offices is not regularly reviewed to provide reasonable assurance it is consistent with BIA’s mission and individual tribes’ priorities and goals. BIA officials said that an agency office’s workforce composition is routinely carried over from year to year, and positions are filled based on the budget, without consideration of existing workload needs or current tribal and agency priorities. A BIA official told us that this practice can result in a surplus of staff in some departments and staff shortages in others. In some of our meetings with BIA agency and tribal officials, we were told that BIA agency offices are not aware of tribal priorities, in part, because of poor relations between BIA agency offices and tribal leadership. Officials from one tribe said that because of concerns that BIA was not routinely seeking tribal input on priorities and goals, the tribe created a position to serve as a liaison between the BIA and tribal leadership. Among other things, the liaison routinely meets with both tribal leaders and BIA officials to ensure BIA is aware of tribal priorities and goals.

Without current workforce information on key skills needed for energy development, tribal goals and priorities, and potential workforce resource gaps, BIA may not have the right people with the right skills doing the right jobs in the right place at the right time and cannot provide decision makers with information on its staffing needs going forward.

DOE Developed Guidance for Giving Preference to Tribes When It Purchases Power, but Government-Wide Guidance Does Not Exist

In 2012 and 2013 respectively, DOE issued policy guidance and procurement guidance to give preference to tribes when DOE facilities contract to purchase renewable energy products or by- products, including electricity, energy sources, and renewable energy credits, but this guidance applies only to DOE, and GSA has not issued government- wide guidance. The purchase preference provision in the Energy Policy Act of 2005 authorizes federal agencies to give preference to a tribe or tribal enterprise when purchasing electricity or any other energy or energy by-product as long as federal agencies do not pay more than the prevailing market prices or obtain less than prevailing market terms and conditions. According to DOE documentation, several tribes had approached federal agencies to negotiate the sale of electricity from tribal renewable energy generation facilities, but negotiations had not resulted in federal purchases for a variety of reasons, including a lack of policy support and implementing guidance for the tribal preference provision. In response, DOE developed a policy to better enable the department to use the tribal preference provision. Under DOE’s policy statement and procurement guidance, DOE facilities can use a purchase preference when a tribal nation holds a majority ownership position in a renewable energy project, provided that the agency does not pay more than the prevailing market price or obtain less than prevailing market terms and conditions. The guidance provides for limiting competition to qualified Indian tribes and tribal majority-owned organizations for the purchase of renewable energy, renewable energy products, and renewable energy by- products.

In contrast, GSA, the federal entity with general statutory authority to enter into utility service contracts of up to 10 years for all federal agencies, has not developed implementing guidance for the tribal preference provision contained in the Energy Policy Act of 2005, according to GSA officials. During our review, we identified one instance in which a tribe owned a majority position in a renewable energy project and submitted a bid in response to a GSA solicitation for energy. In this instance, GSA officials told us that they did not apply the tribal preference provision because GSA lacked implementing guidance. In addition, GSA officials said that the existence of the tribal preference provision and corresponding lack of implementing guidance created uncertainty and increased the time and costs associated with the solicitation review process. GSA officials also told us that they do not need to issue separate tribal preference provision guidance because DOE’s guidance is comprehensive. However, the DOE guidance is intended only for DOE, and GSA has not adopted the guidance for any GSA purchases of energy products. Without GSA guidance on the tribal preference provision—even if that guidance mirrors DOE’s guidance— it is unclear if GSA’s procurement officials will have the information they need to apply the preference to its purchases.

We discussed our findings with members of the FAR Council, which is the regulatory body established to lead, direct, and coordinate government- wide procurement guidance and regulations in the federal government. According to officials, in response to our finding, the FAR Council plans to revisit the tribal preference provisions and survey agencies to seek their input on whether government-wide guidance to implement the preference should be included in the FAR. Officials said the FAR Council will consider agencies’ input and determine if it should issue regulations implementing the preference authority. Additionally, the officials told us the FAR Council will examine DOE’s guidance in this area, as well as GSA’s plans to make other agencies aware of this preference and the DOE guidance in all future delegations for renewable energies.

Stakeholders Identified Additional Actions That Could Overcome Some Factors Hindering Development

Numerous federal agencies offer programs that could be used to assist tribes with energy development activities. However, a few stakeholders said impediments may limit or restrict tribal participation in some of these programs. Federal agencies could identify and seek to remove regulatory, statutory, and procedural impediments that limit or restrict tribal participation. For example, according to a 2016 DOE report, DOE’s Title XVII loan program provides loan guarantees to accelerate the development of innovative clean-energy technology and has more than $24 billion in remaining loan authority to help finance clean-energy projects. However, according to DOE officials, no tribes have applied to DOE’s Title XVII loan program because various program requirements discourage tribal participation. For instance, according to officials, DOE considers whether applicants have prior experience and knowledge to execute the kind of project for which they are seeking a DOE loan guarantee. The officials told us that because tribes have not had significant development opportunities that would provide prior experience, this consideration limits tribes’ abilities to compete with other applicants seeking limited resources.

A few stakeholders also told us that extensive time and monetary resources are required to apply for assistance from some federal programs, making it difficult for some tribes to seek assistance. For example, DOE requires an application fee of $50,000 for its Title XVII loan program. According to DOE officials, high application fees discourage some tribes from applying. Two other stakeholders told us that tribes and tribal entities dedicate significant financial resources and time to complete grant applications for federal programs. Because of this extensive resource commitment, combined with the low probability of receiving assistance, a few stakeholders said they are reluctant to seek federal assistance in the future.

Several stakeholders said the typical size of awards from IEED limit the type of projects that benefit from assistance. Projects that require significant funds are generally not awarded because officials want to fund numerous projects, according to Interior officials. For instance, according to a 2015 Interior report, a tribe requested $321,000 from IEED to drill a geothermal well, but the request was rejected because of the expense relative to funds available. DOE and Interior officials told us they receive significantly more requests for assistance with viable projects than they can fund within existing budget levels. For instance, in 2015, IEED received 22 requests for assistance through its Tribal Energy Development Capacity Program and was able to fund 10 projects, according to IEED officials. In 2014, IEED received requests for $27.5 million in assistance through its Energy and Mineral Development Program and was able to award $9.5 million.

Conclusions

Recognizing the importance of a collaborative federal approach to help Indian tribes achieve their energy goals and to more efficiently fulfill regulatory responsibilities and manage some Indian energy resources, the President and Interior undertook two key initiatives, in the form of the Energy Subgroup and the Service Center. However, to be effective these initiatives rely on collaboration among federal agencies and programs, which can be difficult to achieve. Leading practices can help agencies enhance and sustain their collaborative efforts; however, federal agencies involved in both of these efforts have not incorporated some of these practices. The Energy Subgroup has not identified the resources it needs to achieve its goals or a funding model, and the roles of each partnering agency have not been identified and documented. In addition, BIA, in leading the creation of the Service Center, has not established a single point of contact or lead agency for regulatory activities; has not sought or fully considered input from key stakeholders, such as BIA agency office employees; and has not documented the rationale for key decisions. By following leading collaborative practices, both the Energy Subgroup and the Service Center have the potential to more effectively assist tribes in overcoming the factors that hinder Indian energy development.

In addition, through the Service Center, BIA plans to hire numerous new staff over the next 2 years, which could resolve some of the long-standing workforce challenges that have hindered Indian energy development. However, BIA is hiring new staff without incorporating effective workforce planning principles. Specifically, BIA has not assessed key skills needed to fulfill its responsibilities related to energy development or identified skill gaps, and does not have a documented process to provide reasonable assurance its workforce composition at agency offices is consistent with its mission, goals, and tribal priorities. As a result, BIA cannot provide reasonable assurance it has the right people in place with the right skills to effectively meet its responsibilities or whether new staff will fill skill gaps.

The Energy Policy Act of 2005 authorization of a preference for tribal entities has the potential to increase tribal access to the largest single purchaser of energy in the United States—the federal government. However, GSA—the primary entity responsible for purchasing power for the federal government—has not developed guidance to implement the authority to provide a tribal preference government-wide. By developing such guidance, GSA would help ensure that contracting officials are aware of when the authority for a tribal preference is applicable and how it should be applied to future purchases of electricity and energy products.

Recommendations for Executive Action

We recommend that the Secretary of Energy, the Secretary of the Interior, and the Administrator of the General Services Administration, as appropriate, take the following 10 actions.

We recommend that the Secretary of Energy designate a career senior-level federal government employee to serve as co-chair of the White House Council on Native American Affairs’ Energy Subgroup.

We recommend that the Secretary of the Interior, as Chair of the White House Council on Native American Affairs, direct the co-chairs of the Council’s Energy Subgroup to take the following two actions: (1) Identify appropriate resources needed for the Subgroup to accomplish its goals, as well as a funding model. (2) Establish formal agreements with all agencies identified for inclusion in the Subgroup to encourage participation.

We recommend that the Secretary of the Interior direct the Director of the Bureau of Indian Affairs to take the following six actions: (1) Include the other regulatory agencies in the Service Center, such as FWS, EPA, and the Army Corps of Engineers, so that the Service Center can act as a single point of contact or a lead agency to coordinate and navigate the regulatory process. (2) Establish formal agreements with IEED and DOE that identify, at a minimum, the advisory or support role of each office. (3) Establish a documented process for seeking and obtaining input from key stakeholders, such as BIA employees, on the Service Center activities. (4) Document the rationale for key decisions related to the establishment of the Service Center, such as alternatives and tribal requests that were considered. (5) Incorporate effective workforce planning standards by assessing critical skills and competencies needed to fulfill BIA’s responsibilities related to energy development and by identifying potential gaps. (6) Establish a documented process for assessing BIA’s workforce composition at agency offices taking into account BIA’s mission, goals, and tribal priorities.

We recommend that the Administrator of the General Services Administration develop implementing guidance to clarify how contracting officials should implement and apply the statutory authority to provide a tribal preference to future acquisitions of energy products.

Agency Comments

We provided a draft of this report for review and comment to the Secretary of the Interior, the Secretary of Energy, and the Administrator of the General Services Administration. All three agencies provided written comments. Interior agreed with all 8 recommendations directed to the agency and described some actions it intends to take. Interior’s comments are reprinted in appendix I. DOE agreed with the 1 recommendation directed to the agency and provided technical comments. DOE’s comments are reprinted in appendix II. GSA also agreed with the 1 recommendation directed to the agency and described the actions it intends to take. GSA’s comments are reprinted in appendix III.

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If you or your staff have any questions about this report, please contact me at (202) 512-3841 or ruscof@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix IV.

Appendix I: Comments from the Department of the Interior

Appendix II: Comments from the Department of Energy

Appendix III: Comments from the General Services Administration

Appendix IV: GAO Contact and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the individual named above, Christine Kehr (Assistant Director), Patrick Bernard, Richard Burkard, Patricia Chen, Cindy Gilbert, Alison O’Neill, Daniel Purdy, and Jay Spaan made key contributions to this report.