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Energy hearing: an analysis

WASHINGTON - It wasn't going to lead the evening news with war planes already in the air, but a subdued drama played out at the March 19 hearing on energy bills before the Senate Committee on Indian Affairs.

By the time it adjourned, a line had been drawn in the red earth of Indian country - a line that may well mark the divide between an initial era of modern tribal self-determination, and an emergent era ushered into being by the March 4 U.S. Supreme Court decision in United States v. Navajo Nation. In rejecting a Navajo claim for damages in breach of trust by the Interior Department in negotiations over a coal lease, the high court ruled that the judiciary cannot enforce the federal trust responsibility in the form of damages or compensation without "express statutory language that imposes liability on the United States," in the words of the Navajo testimony at the March 19 hearing.

To take it a step further, implied liability is no more, at least under the Indian Mineral Leasing Act. Congress must now pass legislation with Indian-specific laws at many levels that assign liability to the government - or tribes will bear the risks and liabilities in tribally managed projects. As evident in sidebar conversations at several junctures during the hearing, many Indian people fear the United States v. Navajo ruling could be the thin end of a wedge that erodes overall federal trust responsibilities toward tribes.

Should events prove this analysis accurate, the initial era of modern tribal self-determination will have been one of a gradual gearing up among tribes of skill sets, technical wherewithal and management capacities for independent project management. But under the broad protection of federal trust obligations that implied a kind of federal liability insurance for tribal losses; whereas the new era announced March 4 will move tribes toward independent project management, with the federal trust role dwindling to that of guarantor over tribal property, leaving market discipline as the primary guarantor of tribal profit.

Given these dramatic tidings, the exchange that delivered them was a quiet affair. Theresa Rosier, the Interior Department's counselor to the assistant secretary for Indian affairs, under questioning from Sen. Ben Nighthorse Campbell, R-Colo., testified that Interior will rely on the Supreme Court's Navajo analysis in determining its responsibilities in tribally managed energy production projects, such as the bills under consideration would encourage.

Sen. Daniel K. Inouye, D-Hawaii, responded by noting that many of the energy resource leases tribes now labor under were negotiated in earlier years, when tribes were very much a junior partner to Interior and private business interests. With tribes called upon post-Navajo to assume full liability for these projects if they want to have any say in their management, Inouye addressed the discrepancy in demanding full self-determination of tribes for leases they became a party to in dependent status.

Rosier replied that under the Navajo analysis, Interior will have no liability where it has no managerial participation.

Then Campbell came around again on further questioning, asking for clarification as to whether Interior has any liability for tribally managed energy projects.

Not by the court's Navajo analysis, Rosier repeated.

And there you have a glimpse of one likely future in Indian affairs: on the one hand Inouye, a long-time champion of Native rights on what might be called the historical model; on the other hand Campbell, increasingly dedicated to directing tribes toward free enterprise and its market disciplines; and between them Interior, or by extension any federal agency, taking its stand on the court ruling in Navajo to insist that tribes are either wholly self-determined or wholly dependent, with little or no in-between.

In any case, a paradigm shift has taken place in the trust responsibility, and it first came out in full at the Senate Committee on Indian Affairs hearing of March 19. "The paradigm has switched for us since March 4," said Arvin S. Trujillo, executive director of the Navajo Nation Division of Natural Resources. Indeed, the Navajo asked for as much time as possible to submit testimony to the record of the hearing - the Nation has had to reconsider its response to the energy bills in light of the high court's latest Indian-specific ruling. Trujillo spoke of coming to grips with a "new philosophy," of the Navajo Nation "moving toward development of an energy policy for ourselves."

Between the first day of the war on Iraq and a paradigm shift in the federal trust responsibility, the actual bills before the committee may have come in for a short hearing. But Campbell agreed to keep the record open for at least two weeks, adding that he would move as quickly as possible thereafter to refine the bills and bring them to a vote of the full committee. The war on Iraq has given U.S. dependence on foreign energy sources a much higher profile in the public arena than usual, according to a top Campbell aide, meaning the time is right to promote the huge potential of tribal energy resources.

S. 522, introduced by Campbell with fellow Senate Republicans Pete Domenici of New Mexico and Craig Thomas of Wyoming as co-sponsors, would encourage tribal energy production enterprises, in part by streamlining the regulatory process for approval of leases and rights of way. This would be accomplished through an "opt in/opt out" clause in the legislation, enabling tribes - but only willing tribes, on a voluntary basis; others could "opt out" - to bypass the Interior Department's approval process under certain circumstances.

S. 424, introduced by Sen. Jeff Bingaman, D-N.M., with Sens. Inouye, Campbell, and Tom Daschle, D-S.D., as co-sponsors, concerns tribal energy facilities and federal purchasing support for energy products, especially electricity, generated by tribes.

In the summary Vernon Hill, chairman of the Eastern Shoshone Business Council of the Wind River Indian Reservation, provided to the committee:

"Under current law, the Secretary of the Interior is required to approve each of these agreements which convey and [sic] interest or otherwise encumber an Indian tribe's energy and natural resources. Both bills propose a framework wherein tribal governments would have the option to promulgate regulations, under tribal law and in accordance with specific conditions or requirements set forth in the bills, and submit these regulations for approval by the Secretary of the Interior. Once approved, the tribal government would have the primary governmental responsibility in approving energy development related leases and rights-of-way without having to submit each proposed agreement to the Secretary for approval. If an Indian tribe opts to develop tribal regulations and secure secretarial approval of them, both bills would completely release the United States from any liability associated with leases or rights-of-way executed under these regulations."

Among the concerns Chairman Hill expressed with the bill was the burden it would place on participating tribes to assume all costs and liabilities pertaining to business lease and right-of-way approvals. It should be noted too that tribes can participate in these streamlining provisions only if they choose to participate. Otherwise, for them, the status quo would remain intact. A larger question is whether that status quo itself will change in light of the United States v. Navajo ruling.

Campbell, Bingaman and Inouye all agreed that once various criticisms and refinements are accounted for, the committee should be able to craft a single bill out of the separate offerings by Campbell and Bingaman, and then get behind it as it moves toward a vote.

S. 424 and 522 can both be reviewed on the Senate Committee on Indian Affairs Web site, http://indian.senate.gov. The Supreme Court's majority opinion in United States v. Navajo can be accessed at http://supct.law.cornell.edu/supct/html/01-1375.ZO.html.