Indian Issues: Damages and Compensation for Tribes at Seven Reservations Affected by Dams on the Missouri River
Released: 2007-11-01T00:00:00

Letter

Background

The Flood Control Act of 1944 established a comprehensive plan for flood control and other purposes, such as hydroelectric power production, in the Missouri River Basin. The Pick-Sloan Plan—a joint water development program designed by the U.S. Army Corps of Engineers and the Department of the Interior’s Bureau of Reclamation—included the construction of five dams on the Missouri River, including the Garrison Dam in North Dakota, and the Oahe, Fort Randall, Big Bend, and Gavins Point Dams in South Dakota (see fig. 1). The dams were constructed during a 20-year period from 1946 to 1966.

For tribes at five of the seven reservations, Congress asked us to review the additional compensation proposals developed by tribal consultants. Our reviews for tribes at three reservations—Fort Berthold, Standing Rock, and Cheyenne River—were conducted before Congress authorized their additional compensation. In 1991, we reported on the additional compensation claims for the Three Affiliated Tribes of the Fort Berthold Reservation and the Standing Rock Sioux tribe, and, in 1998, we reported on the additional compensation claims for the Cheyenne River Sioux tribe.

More recently, we reviewed the additional compensation claims for the Crow Creek Sioux and Lower Brule Sioux tribes. The Crow Creek Sioux and Lower Brule Sioux tribes were affected by the Fort Randall and Big Bend dams. The tribes received their original compensation for the damages caused by these two dams in 1958 and 1962. However, the tribes did not consider their original compensation to be sufficient, and they sought additional compensation to address the effects of both dams. As a result, in 1996 and 1997, Congress authorized additional compensation for the Crow Creek Sioux and the Lower Brule Sioux tribes, respectively. In 2003, the Crow Creek Sioux and Lower Brule Sioux tribes hired a consultant to determine if they were due additional compensation based on the method we proposed in our 1991 and 1998 reports. As a result of the consultant’s analysis, the two tribes are currently seeking a third round of compensation. In our 2006 report we assessed whether the tribes’ consultant followed the approach in our prior reports in calculating the compensation for Congress to consider in determining whether additional compensation was warranted for the Crow Creek Sioux and Lower Brule Sioux tribes.

Damages Caused to the Tribes at Seven Reservations as a Result of Dams on the Missouri River

The reservoirs created by the dams on the Missouri River permanently flooded over 350,000 acres of land on seven reservations, ranging from over 150,000 acres flooded on the Fort Berthold Reservation to less than 600 acres flooded on the Santee Reservation (see table 1). In addition to the valuable river bottom land that was lost, the tribes lost any natural resources and structural improvements on the land. The natural resources lost included timber, wildlife, and native plants and berries. The structural improvements lost included such things as homes and ranches. In some cases, entire towns were lost.

The damage that each tribe sustained was unique depending, on the land that was lost, the resources and structures on the land, and the overall impact on the community. For example, the Department of the Interior estimated at one point that 78 percent of the families living on the Fort Berthold reservation, or 289 families, lived in the area that was going to be flooded, a number that was generally two to three times higher than on the other reservations. On the Crow Creek and Lower Brule reservations, the Fort Randall Dam displaced 119 families, and the Big Bend Dam displaced 89 families. In some cases the same families were displaced by both dams. The Crow Creek reservation lost 94 percent of its timberland and the Fort Berthold reservation lost 100 percent of its irrigable land.

In addition to the direct damages, Congress has recognized that the tribes also suffered indirect or intangible damages for the loss of assets of unknown value. These losses included spiritual ties to the lands (for example, cemeteries and tribal monuments); tribal claims to a homeland; and benefits derived from living along the Missouri River.

Compensation Provided to the Tribes on the Missouri River for the Damages Caused by the Dams

The tribes at the seven reservations that lost land due to the flood control projects on the Missouri River originally received compensation for their damages between 1947 and 1962, and they subsequently requested and received additional compensation between 1992 and 2002 (see table 2). For the tribes at the five reservations that we have reported on in the past, the original compensation was based on detailed assessments by the U.S. government and the tribes of the damages caused by the dams and, in some cases, protracted settlement negotiations over how much the tribes should be compensated for their losses. The settlement negotiations for the Cheyenne River Sioux tribe lasted about 4 years from the date settlement negotiations were authorized to the date the settlement legislation was enacted. The settlement negotiations for the Crow Creek Sioux and Lower Brule Sioux tribes involved two dams and stretched over about 9 years, from 1953 through the enactment of their settlement legislation for the Big Bend Dam in 1962. The results of the settlement negotiations were that the U.S. government and the tribes were unable to reach an agreement. As a result, the settlements were left for Congress to decide. For each of the tribes at the five reservations that we have reported on in the past, the original compensation provided was less than what the tribes’ believed their lands were worth.

During our prior reviews, we have recognized the problems with the original settlement negotiations, namely that the tribes may have been at a disadvantage during the negotiations and that they were not willing sellers of their land. We also recognized the inherit difficulties with trying to perform new economic analyses on the damages the tribes sustained 50 years after the fact. In our 1991 and 1998 reports, for the tribes at three reservations, we found the economic analyses used to justify their additional compensation claims to be unreliable, and we suggested that the Congress not rely on them as a basis for providing the tribes with additional compensation. Instead, we suggested that if Congress determined that additional compensation was warranted, it could determine the amount of compensation by calculating the difference between the tribe’s final settlement proposal (referred to in our 2006 report as the tribe’s “final asking price”) and the amount of compensation Congress originally authorized the tribes. We used the inflation rate and an interest rate to adjust the difference to reflect a range of current values, using the inflation rate for the lower end of the range and the interest rate for the higher end. Using this approach, we calculated how much additional compensation it would take today to make up for the difference between the tribes’ final asking prices and the original compensation provided. The three largest additional compensation payments—Cheyenne River, $290.7 million in 2000; Fort Berthold, $149.2 million in 1992; and Standing Rock, $90.6 million in 1992—were all within the ranges we calculated.

The four smaller additional compensation payments were calculated using a different approach. We were not asked by Congress to review the additional compensation claims for the Crow Creek Sioux and Lower Brule Sioux tribes in the 1990s when they received their additional compensation. The Crow Creek Sioux and Lower Brule Sioux tribes did not base their additional compensation claims in the 1990s, on an economic analysis as the tribes did for the three other reservations that we reviewed. Rather, the Crow Creek Sioux and Lower Brule Sioux tribes’ consultant asserted that since the tribes suffered the same type of damages as the Standing Rock Sioux tribe, they should be provided with additional compensation commensurate, on a per-acre basis, with the additional compensation provided to the Standing Rock Sioux tribe in 1992. In our 2006 report, where we reviewed the additional compensation claims by the Crow Creek Sioux and Lower Brule Sioux tribes, we found that the additional compensation provided to the Crow Creek Sioux tribe in 1996 was slightly above the range we calculated and the additional compensation provided to the Lower Brule Sioux tribe in 1997 was within the range we calculated. The additional compensation dollar ranges we calculated for the tribes at five reservations covered in our three prior reports are summarized in figure 2. (The dollar amounts in figure 2 are generally from different years and they should not be added together or compared without first making adjustments for changes in the purchasing power of money over time.)

The additional compensation authorized in 2002 for the Yankton Sioux and Santee Sioux tribes was also partially based on a per-acre calculation. Congress followed a two-part calculation in authorizing additional compensation for the Yankton Sioux and Santee Sioux tribes. The first part involved taking the additional compensation provided to the Lower Brule Sioux Tribe in 1997, on a per-acre basis ($1,763), and multiplying that times the acreage the Yankton Sioux and Santee Sioux tribes lost (Yankton Sioux, $1,763 × 2,851.4 acres = $5.027 million; Santee Sioux, $1,763 × 593.1 acres = $1.046 million). The second part of the calculation involved multiplying the results of the first part by 4.58 to add an amount for severance damages and rehabilitation (Yankton Sioux, $5.027 million × 4.58 = $23.02 million; Santee Sioux, $1.046 million × 4.58 = $4.79 million). We have not performed any reviews of the additional compensation claims for the Yankton Sioux and Santee Sioux tribes.

Rehabilitation funds had been provided to tribes on four of the seven reservations as part of their original compensation in the 1950s and 1960s (see table 3). While rehabilitation was a significant component of the original compensation package for four tribes, we believe it should be considered separately from the comparison for damages because rehabilitation was not directly related to the damage caused by the dams. Funding for rehabilitation, which gained support in the late-1940s, was meant to improve the tribes’ social and economic development and prepare some of the tribes for the termination of federal supervision. From the late-1940s through the early-1960s, Congress considered several bills that would have provided individual tribes with rehabilitation funding. For example, between 1949 and 1950, the House passed seven bills for tribes totaling more than $47 million in authorizations for rehabilitation funding, and considered other bills, one of which would have provided $50 million to several Sioux tribes, including Crow Creek and Lower Brule. Owing to opposition from tribal groups, the termination policy began to lose support with Congress in the late 1950s, and rehabilitation funding for individual tribes during this time was most often authorized by Congress in association with compensation bills for dam projects on the Missouri River. However, the granting of rehabilitation funding for these tribes was inconsistent. Some tribes did not receive rehabilitation funding along with compensation for damages, while others did.

In closing, I would caution against looking solely at the acreage lost and the authorized compensation amounts to try and determine if the tribes were treated consistently. Such comparisons have led to perceived inequities between the tribes. For example, questions could be asked such as, Why was the original compensation for the Standing Rock Sioux tribe almost as much at the original compensation for the Three Affiliated Tribes of the Fort Berthold Reservation when the Fort Berthold reservation lost three times as much land? or Why was the additional compensation provided to the Yankton Sioux tribe almost as much as the additional compensation provided to the Crow Creek Sioux tribe when the Crow Creek reservation lost more than five times as much land? The type of land lost, the resources on the land, the structures on the land, the settlement negotiations, the compensation bills, and the dates when compensation was provided, has varied by tribe. Looking at just the total compensation amounts masks the underlying differences in each of the compensation bills.

Mr. Chairman, this completes my prepared statement. I would be happy to respond to any questions you or other Members of the Committee may have at this time.

Contact and Acknowledgments

For further information, please contact Robin M. Nazzaro on (202) 512- 3841 or nazzaror@gao.gov. Individuals making key contributions to this testimony and our 2006 additional compensation report are Greg Carroll, Tim Guinane, Susanna Kuebler, Jeffery D. Malcolm, and Carol Herrnstadt Shulman.

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