Indian Energy Grants Are Nice, But Tribal Sovereignty is Where the Money’s At

Under 25 U.S.C. § 415, every lease of a tribe’s lands must undergo federal review and approval by the Secretary of the Interior under a sprawling, burdensome set of regulations.  Approval is also subject to the National Environmental Policy Act (“NEPA”), 42 U.S.C. § 4321, et seq., along with the usual delays and court controversies that protract the process.  It is not unheard of for several years to pass before Indian land can be leased, if ever.  Thus, a tribe who wishes to govern its trust lands under free market principles cannot, in practice, do so. In 2005, Congress enacted 25 U.S.C. § 3504, which included provisions for implementation of a Tribal Energy Resource Agreement (“TERA”).  The TERA (1) allows tribes to enter into a master agreement (the TERA) with the Secretary of the Interior, which then (2) grants the tribe the ability to enter into leases and to grant rights of way across tribal lands without Secretarial approval.

Since the TERA’s inception in 2005, however, not a single tribe has entered into a TERA.  For many tribes, the cost simply outweighs the benefits – TERAs allow tribes the leeway to skip Secretarial approval, “but only on terms dictated by the federal government,” which includes the creation of a NEPA-like environmental review process that complies “with all applicable environmental laws.”  As it stands, tribes simply do not have the resources necessary to fulfill the host of NEPA requirements, which impose an extremely heavy burden on tribal governments to demonstrate that they have the requisite expertise, experience, laws, and administrative structures in place to assume the responsibility of a TERA.

Last week Assistant Secretary Washburn announced $9.4 Million in grants to develop tribal energy.   Not a single grant, though, was aimed at funding a TERA.  Although Assistant Secretary Washburn believes that the failure of the TERA is “not for lack of effort” by the Office of Indian Energy and Economic Development (“OIEED”), it sure doesn’t help that, apparently, OIEED has given up on the program entirely.

As laudable as the grants are, it appears that much of the money will be used in efforts to comply with the NEPA and a vast array of other federal laws triggered by 25 U.S.C. § 415.  While the gesture is greatly appreciated, and may be a boon to the recipients, in the grand scheme of things it is an inefficient use of grant monies.  Until tribes are able to implement energy projects on their own land, unfettered from the vast array of burdensome federal red tape, the development of tribal energy will never truly bourgeon.


Ryan Dreveskracht is an Associate at Galanda Broadman, PLLC.  His practice focuses on representing businesses and tribal governments in public affairs, energy, gaming, taxation, and general economic development.  He can be reached at 206.909.3842 or ryan