Indian Issues: BIA's Efforts to Impose Time Frames and Collect Better Data Should Improve the Processing of Land in Trust Applications
Released: 2006-07-28T00:00:00

Letter

Background

The Secretary of the Interior is hereby authorized, in his discretion, to acquire through purchase, relinquishment, gift, exchange, or assignment, any interest in lands, water rights or surface rights to lands, within or without existing reservations … for the purpose of providing land for the Indians. … Title to any lands or rights acquired pursuant to this Act shall be taken in the name of the United States in trust for the Indian tribe or individual Indian for which the land is acquired, and such lands or rights shall be exempt from State and local taxation.

Since 1934, the total acreage held in trust by the federal government for the benefit of tribes and their members has increased from about 49 million to about 54 million acres.

Within Interior, BIA is responsible for the administration and management of all land held in trust by the United States and for serving the 561 federally recognized tribes and about 1.9 million individual Indians and Alaska Natives. The Assistant Secretary for Indian Affairs has primary responsibility for BIA while the BIA Director oversees its day-to-day operations. BIA has over 9,600 staff and an annual budget of about $2.39 billion. BIA’s responsibilities include the administration of education systems, social services, and natural resource management, among other things. BIA is organized by 12 regions with 58 underlying agencies located throughout the country. One region covers the state of Alaska, and the remaining 11 cover the continental United States. (See fig. 1.) A regional director is in charge of each regional office and a superintendent is in charge of each agency office.

The Office of Trust Services, which includes BIA’s Central Office realty staff, provides overall guidance for the land in trust program as one of its many responsibilities. Real estate services staff, about 390 total with an annual budget near $41 million, are located at BIA offices across the country and are responsible for processing land in trust applications, as well as other functions, including property management, land leasing and title activity, and lease compliance. Real estate services staff are under the line authority of regional directors and agency superintendents.

In 1980, Interior established a regulatory process intended to provide a uniform approach for taking land in trust. For on-reservation applications under the Secretary’s discretionary authority, the deciding official must consider the statutory authority to take land into trust; the need for the land; the purpose of acquiring the land; for individual Indians, the amount of land already held in trust and the individual’s need for assistance in handling business matters; the implications for state and local governments of removing land from the potential jurisdictional concerns of state and local governments; BIA’s ability to discharge its duties on the newly acquired land; and environmental compliance, particularly with the National Environmental Policy Act (NEPA).

For off-reservation applications under the Secretary’s discretionary authority, BIA must also place greater weight on the concerns of state and local governments as the distance of the land from the tribe’s reservation increases and review a business plan if the land is to be acquired for business purposes. Once these steps have been completed, BIA provides a decision to the applicant and affected parties. Several additional steps follow, including publication of the decision in the Federal Register or a local newspaper, and possible administrative appeals and litigation.

In 1988, about 8 years after the regulations for taking land in trust were issued, the Indian Gaming Regulatory Act was enacted. The act provided the statutory basis for the operation and regulation of certain gaming activities on Indian lands. It generally prohibits gaming activities on Indian trust lands acquired by the Secretary after October 17, 1988, the date the act was signed into law. However, the act does provide several exceptions that allow gaming on lands acquired in trust after its enactment. For fiscal year 2005, gaming revenues from Indian gaming facilities totaled $22.6 billion.

On applications for land in trust, applicants must declare the anticipated use of the property, particularly whether the property will be for gaming or nongaming purposes. Applications to take land in trust for gaming purposes are handled by the Office of Indian Gaming Management within the Office of the Assistant Secretary for Indian Affairs. In September 2005, Interior’s Office of the Inspector General reported on the processing of applications for land in trust for gaming purposes. The Inspector General reported that while the review and approval process for gaming applications was “sufficient,” the process took an average of 17 months— or about 1.4 years—from the time BIA received the application until its final action. Furthermore, the Inspector General reported 10 instances where tribes had converted lands acquired for nongaming purposes to gaming without first getting the necessary approvals pursuant to the Indian Gaming Regulatory Act. Interior subsequently determined that five of these conversions were eligible for gaming under the Indian Gaming Regulatory Act, one was not, and four were still under review at the time of the Inspector General’s report. The gaming facility on the one ineligible conversion was later closed.

Our report focuses on discretionary nongaming land in trust applications, which fall into three categories—on-reservation, off-reservation, and “gaming related” applications. The gaming related category was added in 2001, and it refers to applications involving support facilities for gaming establishments, such as parking lots and maintenance buildings, but not the actual gaming activity itself. By directive of the Assistant Secretary for Indian Affairs, each category of applications is processed slightly differently or by a different office. In most cases, the decision maker for on- reservation applications is the superintendent of the local BIA agency office. For the remaining on-reservation applications and for the off- reservation applications, the decision maker is the applicable BIA regional director. Off-reservation applications are processed using the criteria in 25 C.F.R. §151.11 and the Assistant Secretary for Indian Affairs is to review the draft decision and supporting materials and provide input before the regional director issues a decision. On- and off-reservation applications are generally processed by a combination of BIA realty staff at BIA’s Central Office in Washington, D.C.; a BIA regional office; or a local BIA agency office. Finally, gaming-related applications are processed by the Office of Indian Gaming Management in Washington, D.C., and the decision maker is the Assistant Secretary for Indian Affairs.

During the land in trust process, administrative appeals must be filed within 30 days of receipt by the applicant of the notice of the decision, and parties have at least 30 days to file judicial challenges after the decision is published in the Federal Register or a local newspaper. Administrative appeals can be filed with the applicable BIA regional director or the IBIA, depending on who the BIA deciding official was. First, if a superintendent was the deciding official, parties can appeal the decision to a regional director. The regional director then reviews the application’s administrative record and any other available information and renders a ruling. The regulations governing appeals state that a regional director must make a ruling within 60 days after all times for pleadings, including extensions, have expired. The regional director’s ruling can then be further appealed to the IBIA, the administrative review body at Interior. The IBIA’s ruling is the final position for Interior. Second, if a regional director was the decision maker, parties may appeal the decision to the IBIA. Once a decision is final for Interior, it is published in the Federal Register or a local newspaper and parties have at least 30 days to file judicial challenges to the decision. Appendix II provides an overview of the land in trust process.

Interior is considering revisions to the land in trust regulations, among a number of other possible regulation changes. Preliminary revisions under consideration were distributed to tribes on December 27, 2005. Changes are under consideration throughout the regulations, including the institution of a trust acquisition request form, new criteria for considering on- and off-reservation acquisitions, extended state and local government comment periods, and time frames for issuing a decision. Although Interior held tribal consultations in February and March to discuss draft regulations, the land in trust regulations were not part of the meetings’ agendas. Interior set the date of March 31, 2006, for tribes to submit comments on the proposed changes. According to the Associate Deputy Secretary, Interior is planning to hold consultation meetings in the last quarter of calendar year 2006, followed by publishing a proposed rule in the Federal Register for public comment.

BIA Generally Followed the Regulations for Taking Land in Trust, and These Regulations Provide BIA with Wide Discretion

BIA generally followed its regulations for processing the 87 land in trust applications with decisions in fiscal year 2005, such as properly notifying affected state and local governments and providing time for comments and appeals. The criteria in the regulations for taking land in trust are not specific and do not include guidelines for how BIA should apply them. Apart from the regulations, we found one BIA agency office did not properly document its decision-making process, including the consideration of the criteria in the regulations. Furthermore, we found that two separate agreements between groups of tribes and two BIA regional offices, designed to expedite the processing of certain applications, have raised concerns and were under investigation by Interior’s Office of Inspector General at the time of our review.

BIA Generally Followed the Regulations for Taking Land in Trust

BIA generally followed its regulations for the 87 land in trust applications with decisions in fiscal year 2005. Specifically, BIA notified affected state and local governments and provided a 30-day comment period for them to submit information on potential tax and jurisdictional impacts; obtained a preliminary title opinion from Interior’s Office of the usually issued a decision letter to the applicant and interested parties based on an evaluation of the criteria in the regulations, including determining compliance with NEPA requirements, provided 30 days for the applicant or interested parties to appeal the decision and an explanation of the appeals process in its decision letter; and, published a notice of its decision in the Federal Register or local newspaper providing at least 30 days for interested parties to seek judicial review.

Of these 87 decisions, 80 were approvals, and 7 were denials. The Superintendent of the Wewoka Agency, Eastern Oklahoma Region, denied one application because the applicant failed to meet the criteria. The Superintendent of the Horton Agency, Southern Plains Region, officially withdrew six applications, in effect denying them, because the tribe did not submit additional necessary information for several years.

Applicants and state and local governments can file appeals and judicial challenges if they believe that BIA failed to properly follow the regulations. Eight of the 87 decisions in fiscal year 2005 had been appealed as of September 30, 2005. Three of the appeals were not filed within the required 30-day appeal period; therefore, they were dismissed as untimely. The remaining five appeals were pending as of September 30, 2005. The appellants generally asserted that BIA did not adequately consider tax and jurisdictional impacts. While these most recent appeals were pending at the end of the fiscal year 2005, some other appeals of decisions from fiscal year 2004 are illustrative in demonstrating how the appeal process works. For example, the local government of Union Township, in the state of Michigan, appealed three land in trust applications to the Midwest Regional Director, asserting that BIA had not addressed, among other things, the township’s jurisdictional and land use concerns in its decision. The township argued that the proposed acquisition would create “an island (of trust land) in the middle of the township in a prime commercial corridor” that might be subject to different zoning and building regulations and that this might create “serious difficulties for rational land use planning.” BIA’s decision stated only that primary law enforcement and fire protection would be provided by the tribe and that the tribal council has good relations with local planning officials and made no mention of the township’s concerns. The Midwest Regional Director agreed that the decision had not adequately addressed the issues raised by Union Township and returned the applications to the Superintendent of the Michigan Agency to better address those concerns. In addition, the Midwest Regional Director determined that the Michigan Agency had not provided sufficient information on environmental compliance.

Criteria in the Regulations Provide BIA Wide Discretion Because They Are Not Specific and Do Not Include Guidelines for How BIA Should Apply Them

In general, we found that the criteria in the regulations provide BIA with wide discretion in deciding to take land in trust, primarily because they are not specific, and BIA has not provided clear guidelines for applying them. For example, one criterion requires BIA to consider the impact of lost tax revenues on state and local governments. However, the criterion does not indicate a threshold for what might constitute an unacceptable level of lost tax revenue and, therefore, a denial of an application. Furthermore, BIA does not provide guidance on how to evaluate lost tax revenue, such as comparing lost revenue with a county’s total budget or evaluating the lost revenue’s impact on particular tax-based services, such as police and fire services. In addition, the criterion does not require deciding officials to consider the cumulative impact of tax losses resulting from multiple parcels taken in trust over time—a practice some state and local governments would like to see instituted. Table 1 shows our analysis of the criteria.

In addition, the criteria are not pass/fail questions and, therefore, the responses to the criteria do not necessarily result in an approval or denial of an application. For example, should BIA decide that an application has “failed” to meet one or more of the criteria, the BIA deciding official still has discretionary authority under the regulations to approve the application. However, we found no instances in which an official decided that an applicant did not meet one or more criteria but still approved the application.

Revisions to the regulations under consideration make it clearer that, because it is difficult to develop specific thresholds for most criteria, BIA intends to assume that most on-reservation applications will eventually receive approval unless a major failing is evident, such as an environmental hazard on a property that would leave the federal government liable to environmental clean-up costs. Conversely, the draft changes make it more difficult to approve off-reservation applications.

One BIA Office Did Not Properly Document Its Decisions and Two Other Offices Have Entered Into Agreements with Tribes That Have Raised Concerns

While we found that BIA procedurally followed the regulations for the 87 applications with decisions in fiscal year 2005, there were two areas not specifically addressed in the regulations that raised concerns.

First, BIA’s Fort Peck Agency, in the Rocky Mountain Region, did not document its decision-making process for two applications decided in fiscal year 2005, including the consideration of the criteria in the regulations. Although not in the regulations, BIA policy calls for offices to include an analysis of each of the criteria in their decision letters for approving or denying applications. This policy stems from a 1999 IBIA statement that failure to provide an analysis of the criteria to interested parties would potentially lead to the IBIA vacating future decisions. BIA realty staff at the Fort Peck Agency were unable to provide us with documentation showing they considered the criteria for two applications approved in fiscal year 2005. The Fort Peck Agency reported it also has some pending applications as of the end of fiscal year 2005. By not documenting its consideration of the applicable criteria, the Fort Peck Agency is not fully disclosing its rationale for its decisions and is, therefore, making the process less transparent.

Two separate agreements between groups of tribes and two BIA regional offices designed to expedite the processing of certain applications were under investigation by Interior’s Office of Inspector General at the time of our review. Specifically, agreements signed by tribes and BIA regional offices in the Pacific and Midwest regions created land in trust consortiums. In both cases, consortium tribes agreed to use a portion of their budget to pay for additional staff positions at BIA dedicated to processing consortium members’ land in trust applications. According to staff with the Inspector General’s office, the Pacific Region’s land in trust consortium agreement was not reviewed or approved by Interior’s Office of the Solicitor before BIA entered into it. The staff further stated that the Midwest Region’s agreement, created several years after the Pacific Region’s agreement, did undergo review and approval by the Solicitor’s Office. Interior’s Office of Inspector General was conducting an investigation of these consortium arrangements to determine whether the tribes’ allocation of money to fund the consortiums was legally authorized and whether BIA was favoring land in trust applications from those tribes.

Many Land in Trust Applications Have Not Been Processed in a Timely Manner

While BIA’s current regulations do not set a specific time frame for making an initial decision on an application, BIA is considering revisions to the regulations that would impose a time frame of 120-business days, or about 6 months, for making a decision for both on- and off-reservation applications once an application is complete. According to our analysis of three categories of land in trust applications, BIA did not decide most applications within the proposed time frames the agency is now considering, or within existing time frames for appeals. First, for the 87 applications with decisions in fiscal year 2005, the median length of time from submission of an application to a BIA decision was a little over 1 year. Second, the 28 complete off-reservation applications currently awaiting review have been at the BIA Central Office for an average of 1.4 years, as of the end of fiscal year 2005. Finally, for applications on appeal, current federal regulations call for regional directors to rule on an appeal within 60 days after all time for pleadings has expired. For the 34 appealed applications awaiting a BIA decision that we reviewed, the average time pending from the BIA decision to the end of fiscal year 2005 was almost 3 years.

Some Applications with Decisions in Fiscal Year 2005 Were Decided in a Timely Manner, While Others Took an Exceedingly Long Time

While the current land in trust regulations do not provide a time frame for BIA’s review of land in trust applications, BIA is considering revisions to the regulations that would establish a time frame of 120 business days, or about 6 months, for BIA to issue a decision once a complete application has been assembled. For the 87 applications with decisions in fiscal year 2005, the median length of time from submission of an application to a BIA decision was 1.2 years, twice as long as the proposed time frame. Using the time frame under consideration as a guide, and allowing 30 days for state and local governments to provide comments, we determined that at least 10 of the 87 applications we reviewed were processed in a timely manner. Additional applications may have been decided in a timely manner, but the files we reviewed did not clearly document the date when an application was complete. Figure 2 shows the amount of time BIA took to process applications with decisions in fiscal year 2005.

Table 2 shows the processing times for the 87 applications we reviewed by region. As the table shows, the shortest processing time—58 days— occurred in the Midwest Region, while the longest processing time— almost 19 years—occurred in the Pacific Region. (App. III provides additional details on the 87 land in trust applications with decisions in fiscal year 2005.)

According to our analysis of BIA files, processing times for applications with decisions in fiscal year 2005 were lengthened by inaction on the part of either the applicant or BIA. For example, according to BIA files, the Pacific Region application that took almost 19 years to process was submitted in 1986 by an individual tribal member to place 5.42 acres of land in trust. BIA found that the application lacked required documents and, therefore, could not process the application until it received these documents. The applicant did not provide the necessary documents until 1991. While the application was deemed complete in 1991, according to our file review, the regional office did not issue a notice to interested parties of the proposed trust acquisition until 2002. However, in the same year, the BIA Pacific Regional Director ordered processing stopped on the application because the applicant’s tribal affiliation was uncertain. BIA and the applicant worked to resolve this issue, and BIA approved the application on February 25, 2005, almost 19 years after its submission. While the BIA file stated clearly that processing on the file was halted initially due to inaction on the part of the applicant, it did not provide an explanation regarding why the application was not acted upon by the BIA from 1991 to 2002. In other cases processed at the Horton Agency Office in Kansas, our file review showed several applications were closed by the agency in 2005 because of inaction on the part of the tribe; one of these applications had been submitted in 1991. BIA officials also noted that access to the Internet would increase their ability to process land in trust applications in a timely manner.

Off-Reservation Applications Have Not Been Processed in a Timely Manner

Off-reservation applications awaiting review by BIA’s Central Office have not been processed in a timely manner. Again, BIA is considering imposing a 120-business day time frame, or about 6 months, for issuing a decision on off-reservation applications once an application is complete. According to BIA Central Office staff, there was nearly a 2-year period between December 2003 and November 2005 when no off-reservation land in trust applications were cleared by the Assistant Secretary. On average, the 28 off-reservation applications we reviewed had been pending in the Central Office for 1.4 years by the end of fiscal year 2005—almost three times longer than the 6-month time frame under consideration. Using the time frame under consideration as a guide, and allowing 30 days for state and local comments, we found that at least 22 of the 28 off-reservation applications pending at the Central Office were not processed in a timely manner. The most recent application forwarded to the Central Office had been pending for about 1 month, while the oldest application had been pending for over 3 years.

This analysis is based solely on the time the applications were pending at the BIA Central Office and does not include the time the applications spent at a BIA agency or regional office before they were forwarded to the Central Office. In total, from the time of their initial submission at a BIA agency or regional office until the end of fiscal year 2005, these applications had been pending an average of 4.6 years. These applications originated from 17 tribes covering 1,832 acres of land in 11 states, primarily in BIA’s Northwest and Southern Plains Regions. (See app. IV for more detailed information on these 28 applications.)

Turnover in the position of the Assistant Secretary for Indian Affairs may have contributed to the length of time involved in processing off- reservation applications. The current Central Office review process was instituted in February 2002. According to the February 2002 memorandum instituting this process, “very effort will be made to complete the overview within one week.” The Assistant Secretary who instituted this process held the position for about 1-1/2 years before retiring in December 2002. Since then, the position of Assistant Secretary of Indian Affairs has been held by three different people: an acting Assistant Secretary; a permanent Assistant Secretary; and, since February 2005, an Associate Deputy Secretary at Interior has served as the Acting Assistant Secretary.

It Appears that Appeals Have Not Been Resolved in a Timely Manner by BIA Regional Directors

Federal regulations require regional directors to “render written decisions in all cases appealed to them within 60 days after all time for pleadings (including all extensions granted) have expired.” According to our review of 34 appealed decisions awaiting resolution by a BIA regional director, the average time pending from the time of the decision to the end of fiscal year 2005 was 2.8 years. While our file review did not allow us to determine at what point “all time for pleadings” had expired in each case, it appears, based on the lengthy time period, that none of the 34 appealed decisions awaiting a regional director’s ruling were resolved in a timely manner. However, in cases in which a ruling has not been rendered by a regional director within the required time frame, the regulations provide a process to appeal the inaction of the regional director to the IBIA. Under these circumstances, the IBIA has stated that it could use its authority to order a Regional Director to issue a final decision on a tribe’s trust acquisition request. Typically, however, the IBIA has instead ordered the regional director to provide a status report on the requested action. If satisfied that the matter is being addressed or has already been resolved by the regional director, the IBIA has dismissed the appeal. Most of the appealed decisions we reviewed originated from BIA’s Southern Plains Region. (App. V provides additional details on these applications.)

When applications are not processed in a timely manner because of delays by BIA or the applicant, information in the applications can become outdated, particularly environmental assessments, comments from state and local governments, and tax data. When this happens, BIA must devote additional resources to obtain updated information and reprocess the applications—an inefficient and time-consuming process for BIA, Indian applicants, and state and local governments. The applicants also bear a direct financial cost because they continue to pay property taxes on the land while BIA is processing their applications. The applicant may face additional financial burdens due to processing delays, such as the opportunity costs associated with delayed economic development activities.

Citing Taxes and Jurisdictional Issues, State and Local Governments Opposed Applications in Fiscal Year 2005

When opposing land in trust applications or appealing decisions, state and local governments principally cited concerns about lost tax revenues and jurisdictional issues. In commenting on applications prior to decisions made in fiscal year 2005, state and local governments opposed 12 of 87 applications, or about 14 percent, mainly citing concerns about lost tax revenues and jurisdictional issues. State and local governments have also opposed some applications through administrative appeals, again primarily citing lost tax revenues and jurisdictional issues. As of the end of fiscal year 2005, a total of 45 decisions were pending review on appeal, including 5 decisions from fiscal year 2005. Although we found little opposition to the applications with decisions in fiscal year 2005, some state and local governments we contacted said (1) they did not have access to sufficient information about the land in trust applications and (2) the 30-day comment period was not sufficient time in which to comment.

Citing Primarily Taxes and Jurisdictional Issues, State and Local Governments Opposed Only a Small Percentage of the Applications with Decisions in Fiscal Year 2005

For the 87 land in trust applications with decisions in fiscal year 2005, state and local governments opposed or raised concerns—primarily involving taxes and jurisdictional issues—on 12 applications prior to BIA’s decision. For example, the state of Kansas opposed the Kickapoo tribe’s application for placing about 75 acres in trust because trust status would cause a loss of tax revenue, which amounted to $172 for the county in 2000. Despite the tax loss, Kansas said its local government would still bear the cost of continuing to provide services, such as road maintenance and fire protection. The county of jurisdiction—Brown County, Kansas—opposed trust status, saying “…further erosion of the real estate base is always a concern.” The tribe responded in a letter to BIA in 2001, saying it disagreed with the state’s arguments. In April 2005, the Superintendent of BIA’s Horton Agency in the Southern Plains Region closed the application because the tribe did not respond to BIA’s requests for additional information for several years.

BIA generally reviewed the comments it received on pending applications and considered them in its decision-making process. Table 3 describes the Indian tribe, the acreage, proposed use of land to be taken in trust, and the tax losses state and local governments expressed concern about prior to BIA’s decision on 12 applications.

As table 3 shows, while most lost annual tax revenue was less than $1,000, Santa Barbara County, California, opposed the Santa Ynez Band of Chumash Mission Indians’ application for 6.9 acres to be placed in trust because of a tax loss of about $43,000 per year. Before the decision, the county held a public hearing in June 2004 on the environmental assessment for the proposed trust acquisition. More than 50 speakers commented, mostly in opposition to the application. BIA and county officials held a joint meeting to discuss the issues the county raised. BIA ultimately approved the trust application in January 2005, and the county did not oppose the decision at that time. However, several citizen groups appealed the decision, and in August 2005 the county filed a motion to intervene or alternatively file an amicus brief. The IBIA dismissed the motion for intervention as untimely and dismissed the citizens’ appeals for lack of jurisdiction in February 2006.

State or Local Governments Have Also Cited Primarily Tax and Jurisdictional Issues When Opposing BIA Land in Trust Decisions through Administrative Appeals

As of September 30, 2005, 45 appeals were pending either before BIA regional directors or the IBIA. All but two appeals involved decisions approving land in trust applications, and all but three appeals were filed by state or local governments. These appeals echo the tax, jurisdiction, and other types of issues that were raised before BIA’s decision. Most of the pending appeals were made by a state or local government that frequently or routinely appeal BIA’s decisions on land in trust applications. BIA’s Southern Plains Region had the highest number of appeals that were pending as of September 30, 2005. (See table 4.) The appeals in the Southern Plains Region generally involve the state of Kansas and Jackson County, Kansas.

See appendix V for detailed information on the 34 appeals awaiting resolution by a BIA regional director and table 5 for detailed information on the 11 appeals awaiting resolution by the IBIA.

The following example illustrates the types of concerns raised on appeal. In 2002, the state of Kansas appealed a decision by the Horton Agency Superintendent to allow 7.85 acres in trust on the Sac & Fox reservation. The state argued that BIA’s decision (1) reduces the tax rolls by $492; (2) violates the Tenth Amendment to the Constitution, since states surrendered many powers to the federal government but retained residual sovereignty; and (3) violates the Act for Admission of Kansas into the United States because it would compel the state to relinquish its sovereign jurisdiction over the land. The tribe stated that (1) Brown County, the recipient of the $492 per year in taxes, did not file an appeal and the amount is insubstantial; (2) the Regional Director, like the IBIA, lacked jurisdiction to declare federal statutes unconstitutional, and this issue has been addressed in several other appeals to the IBIA; and (3) Kansas had accepted admission into the United States on the condition that the federal government retained its power to regulate Indian affairs; therefore, BIA did not infringe on the state’s sovereignty. The Southern Plains Regional Director was still considering the appeal as of June 8, 2006.

Similar arguments about loss of tax revenues and jurisdictional issues have been made in appeals before the IBIA. For example, Cass County and the City of Cass Lake, Minnesota, appealed three decisions of the Minnesota Agency Superintendent to place 1.28 acres of land of the Minnesota Chippewa Tribe (Leech Lake Band) in trust in 2001. The land was to be used for residential housing, women’s services programs, and a tribal health office. The county and the city said the loss of the land would have a negative impact on the tax rolls and that the land might not be within the reservation boundaries; consequently, the applications would be subject to additional criteria. When the matter was appealed to the Regional Director, he concluded that the tax loss of about $5,000 annually was not significant and that the tribe’s services to the entire community, including non-Indians, reduced the financial burden on local governments.

State and Local Governments Want More Information about Applications as Early as Possible and More Time to Comment

Some state and local government officials want more information about applications early in the process, and they want more time to comment. In a July 2005 paper, the National Governors Association stated that any new regulations should include, among other things, a requirement that states and local governments be able to review tribal submissions and evidence, just as tribes are able to review state submissions. The governors also said that language in the regulations should ensure that states have the right to provide data challenging assertions made in the proposals to take land in trust. According to some state and county officials, the current process does not work well in providing them with information and an opportunity to comment. During a meeting with staff of various state governors, arranged by the National Governors Association, an attorney with the South Dakota Office of the Attorney General told us that while the governor’s office receives notification of land in trust applications, the state does not have access to a tribe’s application except through a Freedom of Information Act request, which often takes too long. He said BIA does not consistently allow for extensions in these cases. In a meeting with county officials arranged by the National Association of Counties, a representative from a New York county said that BIA’s process was unfamiliar, so the state, the two counties involved, and other local governments paid for extra legal, economic, and environmental consultants. However, he said it was not possible for these government entities to respond adequately to the initial BIA notice within 30 days. BIA provided an extension of time for the county to respond.

Similarly, some state and local governments raised the following access and timing issues in comments on the applications that we reviewed: In 1999, Cass County told the Minnesota Agency Superintendent that further documentation on the application from the Minnesota Chippewa Tribe (Leech Lake Band) was needed for the county to provide specific comments other than the amount of taxes. The county asked for more documents under the Freedom of Information Act and for an additional 60 days to comment following receipt of the documents. BIA provided the documents and more time.

In June 2001, Santa Barbara County, California, responded to a notice of an application that, without information regarding how the Santa Ynez Band of Chumash Mission Indians of the Santa Ynez Reservation intended to regulate activity on trust land, the county could only speculate that jurisdictional and land use conflicts would arise.

In December 2002, an assistant legal counsel to the governor of Kansas wrote to the BIA representative in the Horton, Kansas, field office that to effectively represent the state, it was necessary to have each tribe’s resolution plan that accompanies the initial application for land to be taken into trust.

Also, in a January 2005 letter, the General Counsel to the Governor of Minnesota told BIA that it could not fully comment on an application by the Minnesota Chippewa Tribe (Grand Portage Band) without an opportunity to review the proposed purpose for conversion and potential uses.

In the revisions to the regulations, Interior is considering providing some additional information to state and local governments and lengthening the period for comments. One provision under consideration would require that a tribe complete a form called a “request for trust acquisition.” BIA would provide the form, along with a description of the land and the proposed use of the land, to the state and local governments having jurisdiction. Another provision would lengthen the time period for state and local governments to comment after BIA provided notice of an application. The time periods would change from 30 days to 60 days for on- reservation applications and to 90 days for off-reservation applications.

BIA’s Land in Trust Database Is Incomplete and Inaccurate, and BIA is Planning to Redesign It

During the course of our review, we found the data in BIA’s land in trust database, which was implemented agencywide in August 2004, were frequently incomplete and inaccurate. As a result, the data are of questionable value to Interior and BIA management, and we did not rely on it. BIA has already recognized some shortcomings and initiated an effort to re-evaluate and redesign the database, as necessary. The database was hastily developed and deployed without defining and documenting user requirements throughout the agency and clearly defining data fields. Staff with Interior’s Office of Information Development said a contractor developed the database in about a month to address the information needs of the Deputy Assistant Secretary for Indian Affairs in the summer of 2004. In a June 2005 memo, almost a year after the system was put in place, BIA’s Deputy Director for Trust Services noted that only 4 of the possible 11 regions had entered any data into the database, and the memo directed each BIA regional and agency office to enter all of its land in trust applications into the database within 5 days. By the end of fiscal year 2005, the database contained more than 1,000 applications.

We found that not all of the applications had been entered into the database, and the status of an application, as either approved, denied, or pending, was frequently incorrect in the database. Specifically, we found the following issues: Not all of the applications had been entered into the database. Twenty- nine of the 87 applications with decisions in fiscal year 2005, or 33 percent, were not in the database. About half of these applications not in the database, 13, were from the Eastern Oklahoma Region’s Chickasaw Agency. No one at the office had access to the database when we initially inquired and, therefore, they could not enter information. Also 9 applications at the Pacific Region were not in the database, and no one there had access when we inquired. We also found instances at the Midwest and Southwest Regions where some pending applications had not been entered into the database. The high rate of applications that had not been entered into the database is one of the factors that led us to conclude that database information was unreliable.

Status of applications was frequently incorrect. During the course of our review, we found that 30 of the 41 applications identified as denied in the database were miscoded, an error rate of almost 75 percent. Most of the remaining “denied” applications were applications that were closed by realty staff with the Southern Plains Region’s Horton Agency because the tribal applicants had not responded for more than a year to BIA’s requests for the additional information needed to process the applications. The applications were not processed and denied based on the criteria in the regulations; rather, they were closed due to inactivity. However, as currently designed, there is no category in the database to show this type of resolution other than denied. In addition, we found that some offices interpreted “approved” differently. For example, two agency offices in BIA’s Rocky Mountain Region used an application form that required the agency superintendent to approve the application for filing and processing. As defined by these offices, some applications being processed had been “approved,” but they were actually pending applications. Other BIA offices considered an application approved when the superintendent actually approved taking the land in trust. While some of the problems we encountered with the status of the applications in the database were simply data entry errors, others were the result of systematic problems, such as the lack of common definitions for key terms.

Furthermore, at the time of our review, regional and agency realty staff did not use the new database as the primary tool for managing their applications. According to BIA regional and agency realty staff, they do not use or do not like to use the database because it is cumbersome, slow, and does not meet their needs. They continue to use their office-specific spreadsheets to manage and track their applications. These office spreadsheets were one of the tools we used to try and verify the information in the database. However, trying to reconcile the office spreadsheets with the database was difficult because the office spreadsheets usually identified applications only by parcel name, whereas the database identified applications with different unique identification numbers by region, agency, and tribe.

We believe that data need to be accurate, valid, complete, consistent, and timely enough to document performance, support decision making, and respond to the needs of internal and external stakeholders. According to Interior officials, the database has been used to respond to questions about the program from various levels of management and from Congress. Further, data quality depends on how readily users can access data, aided by clear data definitions and user-friendly software. When significant data limitations exist, it is important to make stakeholders and Congress aware of the limitations so they can judge the credibility of the data for their use. During the course of our review, BIA recognized that the database has limitations, and it asked Interior’s Office of Information Development to improve the database. In April 2006, the Deputy Director for Information Development conducted a 3-day workshop for program managers on BIA’s land in trust database. The session served as a basis for making improvements and, in May 2006, the office was preparing a plan to (1) involve regional and headquarters officials in changing the database, (2) better define terms and fields, and (3) increase the number of fields in the database. A properly designed and implemented database with accurate data would provide BIA with important information to help better manage the land in trust process.

Conclusions

The land in trust regulations were intended to provide a clear, uniform, and objective approach for Interior to evaluate land in trust applications. However, the regulations provide wide discretion to the decision maker because the criteria are not specific, and BIA has not provided clear guidelines for applying them. Given the wide discretion that exists and the increased scrutiny that the land in trust process has come under with the growth of Indian gaming, it is important that the process be as open and transparent as possible. Clearly documenting each decision and providing that information to state and local governments is a critical component of having an open and transparent process. However, contrary to BIA policy and admonishments from the IBIA, we found one BIA office that did not document its consideration of the criteria in the regulations. While this office only accounted for 2 of the 87 decisions in fiscal year 2005, it omitted documentation of the most important part of the process. State and local governments need information on how BIA reaches its decisions to effectively execute their role in the process, including holding the federal government accountable for its decisions and having adequate information to decide whether or not to appeal a decision if it believes that the federal government did not adequately follow the process.

A lack of specific time frames for BIA to make decisions on land in trust applications results in a lack of predictability about the process and contributes to the perception, on the part of Indian applicants and state and local governments, that the process is not open and transparent. Lengthy application processing times can place a burden on BIA, Indian applicants, and state and local governments. If applications are not processed in a timely manner because of delays by BIA or the applicant, information in the applications can become outdated, particularly environmental assessments, comments from state and local governments, and tax data. When this happens, BIA must devote additional resources to obtaining updated information and reprocessing the applications—an inefficient and time-consuming process for BIA, Indian applicants, and state and local governments. To the extent that BIA is the cause of some of these delays, imposing specific time frames on the decision-making process should improve the processing of the land in trust applications. In addition, some state and local governments have been unable to adequately participate in the process because they did not have enough information on the pending applications or the necessary length of time to provide substantive comments. Interior is considering changes to the regulations that would address these issues.

Finally, federal agencies need data that are accurate, valid, complete, consistent, and timely enough to document performance, support decision making, and respond to the needs of internal and external stakeholders. During the course of our review, BIA recognized the shortcomings with the data in its land in trust database and initiated a process to improve the database. A properly designed and implemented database with accurate data would provide important information to (1) BIA to help it better manage the land in trust process and (2) other stakeholders, particularly Congress, to help carry out oversight of the land in trust process.

Recommendations for Executive Action

To improve timeliness and transparency and ensure better management of BIA’s land in trust process, we recommend that the Secretary of the Interior direct the Assistant Secretary for Indian Affairs to take the following three actions: reinforce the requirement that all decisions be fully documented; move forward with adopting revisions to the land in trust regulations that include (1) specific time frames for BIA to make a decision once an application is complete and (2) guidelines for providing state and local governments more information on the applications and a longer period of time to provide meaningful comments on the applications; and institute internal controls to help ensure the accuracy and reliability of the data in the land in trust database, as part of the redesign of the existing system.

Agency Comments

Interior’s Associate Deputy Secretary commented on a draft of this report in a letter dated July 12, 2006 (see app. VI). In general, Interior agreed with our findings, conclusions, and recommendations. The Associate Deputy Secretary commented that BIA is working to address the recommendations and that a corrective action plan will be developed and implemented in response to the report. Specifically, BIA is taking steps to finalize the regulations under consideration. After the regulations are completed, BIA will develop a handbook to ensure consistent application of the regulations. The handbook will also include specific internal control procedures to ensure all decisions are properly and completely documented, as well as entered into the land in trust database accurately and in a timely manner.

We are sending copies of this report to interested congressional committees, the Secretary of the Interior, the Assistant Secretary for Indian Affairs, BIA regional and agency offices we visited, and other interested parties. We will also make copies available to others upon request. In addition, the report will be available at no charge on the GAO Web site at http://www.gao.gov.

If you or your staff have any questions about this report, please contact me at (202) 512-3841 or nazzaror@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 VII.

Objectives, Scope, and Methodology

The fiscal year 2006 House Appropriations Committee Report for the Department of the Interior’s (Interior) appropriation bill directed GAO to study the Bureau of Indian Affairs (BIA) procedures and practices in implementing the land in trust regulations. In response to this direction and subsequent discussions with congressional staff, we (1) assessed the extent to which BIA’s processing of land in trust applications followed its regulations, (2) determined the extent to which applications were processed in a timely manner, and (3) identified any state and local government concerns about land in trust applications and how they were addressed in BIA’s decision-making process.

For all of the objectives, we reviewed applicable laws, regulations, and land in trust applications. We reviewed applications at six BIA regional offices— Eastern, Midwest, Northwest, Pacific, Southern Plains, and Southwest— and eight BIA agency offices—Blackfeet (Browning, Montana), Chickasaw (Ada, Oklahoma), Great Lakes (Ashland, Wisconsin), Horton (Horton, Kansas), Minnesota (Bemidji, Minnesota), Siletz (Siletz, Oregon), Warm Springs (Warm Springs, Oregon), and Wind River (Fort Washakie, Wyoming). We selected those offices because our general intent was to visit all BIA offices with 10 or more land in trust applications described as approved or denied in BIA’s land in trust database. However, interviews with realty officials at these offices and at the Western, Great Plains, Navajo, and Rocky Mountain Regions and our examination of documents they provided led us to conclude that the database was frequently incomplete and inaccurate. During the course of our work, we found many examples of inaccuracies in the database that showed data were missing, incorrectly described, or inconsistently reported. Therefore, our scope was limited to the groups of applications in which we had greater confidence that we had obtained all of the applications. We examined (1) 87 discretionary nongaming land in trust applications with decisions in fiscal year 2005, (2) 28 off-reservation applications awaiting comments from the Office of the Assistant Secretary for Indian Affairs, (3) 34 appealed decisions pending before BIA regional directors at the end of fiscal year 2005, and (4) 11 appealed decisions pending before the Interior Board of Indian Appeals (IBIA) at the end of fiscal year 2005. In an effort to collect all of the applications in these categories, we relied on interviews with BIA realty officials in the relevant offices, examination of their localized spreadsheets for tracking applications, and some comparisons with other BIA databases. To identify the pending appeals at the IBIA, we relied on these methods and the selections provided by the Chief Judge and an examination of the IBIA’s informal log.

We collected 67 of the 87 discretionary nongaming land in trust applications with decisions in fiscal year 2005, or 77 percent, during our site visits. From telephone discussions with realty staff, we identified the remaining relevant applications at five agencies—Colville (Colville, Washington), Fort Peck (Fort Peck, Montana), Michigan (Sault Ste. Marie, Michigan), Southern California (Riverside, California), and Puget Sound (Everett, Washington). Staff at locations we did not visit made copies of an additional 18 applications and mailed them to us. We contacted realty officials at the Navajo Region and the Great Plains Region, including its agencies—Rosebud (Rosebud, South Dakota), Lower Brule (Lower Brule, South Dakota) and Pine Ridge (Pine Ridge, South Dakota) and verified that they had no applications with decisions in fiscal year 2005. In addition, we obtained applications that were appealed to BIA regional directors and pending in fiscal year 2005 based on discussions with realty officials in the various field offices and regions and from examining their files. We used a similar method to identify and collect applications appealed to the IBIA that were pending at the end of fiscal year 2005. Also, we interviewed the Chief Judge of the IBIA to identify pending applications; he provided copies of relevant applications. In doing so, we obtained information on the two remaining applications with BIA decisions in fiscal year 2005.

Besides interviews with BIA and Interior officials, we obtained views from various interested parties including representatives of the National Governors Association, the National Association of Counties, National Congress of American Indians, and several individual tribes. The National Governors Association invited their members to meet with us, and they hosted a teleconference, which included representatives from 12 states— Arkansas, California, Colorado, Connecticut, Kentucky, New Mexico, New York, Ohio, Oklahoma, South Carolina, South Dakota, and Washington. The National Association of Counties included a panel session with GAO at their annual meeting in March 2006. The six participants were from the California State Association of Counties; Kitsap County, Washington; Madison County, New York; Navajo County, Arizona; Seneca County, New York; and Ziebach County, South Dakota.

For discussions with tribal leaders, we used a nonprobability sample to select tribes that submitted applications in recent years to BIA locations we visited. We met with representatives of the 13 tribes listed in table 6.

In addition, we obtained Interior’s and Indians’ views on the land in trust process by participating in a panel session on the subject at the Self- Governance Tribes’ Fall Conference in 2005.

For each of the objectives we took the following specific actions: To determine how BIA processed land in trust applications, we reviewed the 87 applications with decisions in fiscal year 2005 and compared how the applications were processed with the requirements in the regulations and departmental guidance. In addition, we interviewed Interior’s field solicitors in Minnesota and Oregon to obtain their perspectives on how BIA followed procedures during their reviews of applications.

To determine whether applications were processed in a timely manner, we compared the processing times for (1) 87 applications with decisions in fiscal year 2005 and (2) 28 complete off-reservation applications awaiting comments from the Office of the Assistant Secretary for Indian Affairs to the 120-business days, or about 6 months, time frame BIA is considering imposing for making decisions on on- and off-reservation land in trust applications. The reported minimum, median, and maximum processing times are for fiscal year 2005 only and might not be indicative of other years. For each of the applications with decisions in fiscal year 2005, we tried to use the date of the application as the initial point to calculate the processing time. For the few applications where we could not determine the date of the application, we used either the date of the tribal resolution requesting that the land be placed in trust or the date BIA notified state and local governments about an application. We used the decision date as the end date for calculating the processing time of these applications. For off-reservation applications, we calculated the time from the date of the draft decision to the end of fiscal year 2005. In addition, we compared the length of time that 34 appealed decisions had been awaiting resolution by BIA regional directors with the current 60-day time frame set forth in the regulations on appeals. For the appealed decisions, we calculated the time from the date of the decision to the end of fiscal year 2005. We also interviewed BIA officials and tribal representatives involved in the process to obtain their views on the time taken for processing applications.

To determine whether state and local governments had concerns, we analyzed the content of comments made by these governments for the 87 applications with decisions in fiscal year 2005 and 45 appeals pending at the end of fiscal year 2005. Moreover, we reviewed the National Governors Association 2005 position paper on revisions to the regulations for processing land in trust, and we obtained draft revisions to the regulations from a Counselor to the Assistant Secretary for Indian Affairs at Interior.

As described above, we decided that the BIA database was not reliable for our purposes. To determine the accuracy and reliability of the database, we compared the information in the database with other data sources, including spreadsheets used by a number of the BIA offices we visited to track land in trust applications, BIA realty reports under the Government Performance and Results Act, and BIA annual acreage reports. We also discussed the development of the current database and the proposed redesign of the database with staff in the Office of the Chief Information Officer within the Office of the Assistant Secretary for Indian Affairs.

We performed our work between August 2005 and June 2006 in accordance with generally accepted government auditing standards.

BIA’s Process for Placing Land in Trust

Remnd In the case of a denial by the superintendent and no appeal, the process would end here.

Processing Times for 87 Land in Trust Applications with Decisions in Fiscal Year 2005

Processing Times for 28 Off-Reservation Land in Trust Applications Awaiting Consideration by BIA Central Office

Processing Times for 34 Appealed Land in Trust Decisions Awaiting Resolution by a BIA Regional Director

Comments from the Department of the Interior

GAO Contact and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the individual named above, Jeffery D. Malcolm, Assistant Director; Jean Cook; Mark Keenan; Daniel J. Semick; Carol Herrnstadt Shulman; and Susan Swearingen made key contributions to this report. Also contributing to the report were Jennifer DuBord, Susanna Kuebler, Greg Marchand, Justin Monroe, George Quinn, Anne Rhodes-Kline, Jena Y. Sinkfield, Ashanta Williams, and Greg Wilmoth.