ROADBLOCKS TO SURFACE USE IN INDIAN COUNTRY: A DISCUSSION OF LEGAL ISSUES RELATED TO SURFACE USE FOR MINERAL DEVELOPMENT ON INDIAN LANDS

• Jurisdiction: United States

Natural Resources Development on Indian Lands
(Mar 2011)
CHAPTER 7B
ROADBLOCKS TO SURFACE USE IN INDIAN COUNTRY: A DISCUSSION OF LEGAL ISSUES RELATED TO SURFACE USE FOR MINERAL DEVELOPMENT ON INDIAN LANDS
Curt R. Sholar ^*
Department of the Interior
Office of the Solicitor
Billings, Montana

CURT R. SHOLAR is an Attorney-Advisor with the Office of the Solicitor, Rocky Mountain Region (Billings). Before joining the Office of the Solicitor, Curt advocated for Blackfeet tribal members as an attorney for Montana Legal Services Association. Early in his career Curt served as a VISTA volunteer to the Akhiok-Kaguyak Tribe in Akhiok, Alaska located on the southeastern end of Kodiak Island. Curt is a graduate of the University of Oklahoma College of Law, with a certification in American Indian Law and Policy, and served as a published member of the American Indian Law Review.

I. Introduction

A tribe's determination of whether to enter into a lease or consent to a right-of-way across its land for mineral development is an exercise of its sovereignty and comports with the federal government's policy of tribal self-determination.¹ But, when a tribe chooses to enter into a lease or consent to a right-of-way affecting their lands, the Secretary of the Interior (Secretary) has a concomitant trust duty to ensure that the lease or right-of-way is in the best interest of the tribe and tribal members.² This trust duty is exercised through the Secretary's approval authority over leases and grants of rights-of-way across Indian lands, with deference to and promotion of tribal control and self-determination.³

Congress has provided an extensive legislative framework for the approval of leases and grants of rights-of-way across Indian lands.⁴ In addition, the Department of the Interior (DOI) has developed detailed regulations that set forth the process of obtaining leases and rights-of-way on Indian lands that charge DOI with specific responsibilities during the approval process.⁵ Nevertheless, these same statutory and regulatory requirements that are designed to protect and allow efficient federal administration of Indian lands can present a myriad of legal issues that

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must be considered when entering into leases and rights-of-way that grant access to Indian country.

This paper considers particular legal issues related to surface use that may arise during the course of mineral development on Indian lands; more specifically the application of the federal government's pervasive trust obligation to leases and rights-of-way involving Indian interests, the federal government's review and approval authority over Indian Mineral Development Act agreements and the potential effects of the National Environmental Policy Act on these agreements, access across Indian lands that are not encompassed by the terms of a negotiated lease or right-of-way, and the federal government's immunity to suit based upon a property's status as trust or restricted Indian lands under the Quiet Title Act.

Part II provides a general overview of acquiring an interest in Indian lands and the role of the federal government in the process. Part II also explains the common law and statutorily prescribed trust obligations that the federal government owes to tribes and individual Indians when approving the acquisition of an interest in Indian lands. Part III considers negotiated surface use in Indian Mineral Development Act agreements and the impact that non-No Surface Occupancy lease classifications under the National Environmental Policy Act can have on a lessee's surface use. Part IV explores the federal government's immunity to suits under the Quiet Title Act that seek to challenge the status of private roads on Indian lands that are within the exterior boundaries of a reservation but outside the lands subject to a mineral lease.

II. Rights-of-Way Across Indian Lands and the Role and Responsibility of the Federal Government

a. The Federal Government's Statutory and Regulatory Authority to Grant Rights-of-Way Across Indian Lands

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Anyone receiving a right or interest in Indian lands only receives those rights specifically granted to them by the federal government.⁶ All questions with respect to rights of occupancy in land, the manner, time, and conditions of extinguishment of Indian title are solely for consideration of the federal government.⁷ It follows that third parties acquire only rights and interests in Indian lands as may be specifically granted to them by the federal government.⁸ Any intent to deprive Indian tribes of rights in land must be clearly and unequivocally stated and language appearing in such grants and statutes is not to be construed to the prejudice of Indians.⁹ As the Ninth Circuit stated in Imperial Granite Co. v. Pala Band of Mission Indians, "[t]he whole purpose of trust land is to protect the land from unauthorized alienation."¹⁰ Moreover, Congress has expressly provided statutory methods for obtaining grants of easements and rights-of-way across Indian lands.¹¹ Those statutory provisions require consent of the tribe or individual allottee before a right-of-way can be granted.¹²

The Secretary has certain statutorily imposed duties concerning rights-of-way on Indian lands. In 1899, Congress gave the Secretary the power to grant rights-of-way for railroad, telegraph, and phone lines on Indian lands.¹³ While not specifically requiring consent of the Indian landowner, the statute has certain limitations on the grant of a right-of-way. For example, rights-of-way can only be granted if an applicant made the request in good faith.¹⁴ Furthermore,

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if an Indian landowner objects to the grant, they are to be afforded a full opportunity to be heard on the matter.¹⁵

In 1901 Congress passed a law authorizing the Secretary to grant rights-of-way to state or local authorities for the purpose of constructing public highways on Indian lands.¹⁶ This statute constrains grants to terms the Secretary deems appropriate and further requires that, at a minimum, state laws governing the establishment of public highways be followed.¹⁷

In 1948, Congress authorized the Secretary to grant rights-of-way over Indian lands for any purpose, codified at 25 U.S.C. § 323.¹⁸ A conspicuous condition on these grants, however, is that tribal or majority beneficial owner consent must be obtained.¹⁹

Arguably, the significant network of statutes that govern the granting of specific and general types of rights-of-way over Indian lands is confirmation that grants of rights-of-way over Indian lands must be grounded in an authorizing statute. An interest in Indian land held in trust by the United States cannot be obtained via a public works statute or common law theories governing long-term use, adverse possession, or prescription.²⁰

The regulations governing rights-of-way over Indian lands, 25 C.F.R. pt. 169, include requirements for rights-of-way for specific purposes; such as service lines, railroads, oil and gas pipelines, telephone and telegraph lines, other communication facilities, power projects, and public highways.²¹ The general provisions of these rights-of-way regulations, located at 25 C.F.R. §§ 169.1 - .21, apply to rights-of-way for specific purposes. The general provisions

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include requirements for the application process, tribal and allottee consent to grant or renew rights-of-way, permission to survey, maps, field notes, public surveys, consideration and damages for right-of-way grants, termination of rights-of-way, and condemnation actions involving individually owned lands.²²

b. The Role of the Federal Government Under the Indian Long-Term Leasing Act of 1955 and Accompanying Regulations

The Indian Long-Term Leasing Act of 1955, 25 U.S.C. § 415, grants the Secretary broad leasing authority, for particular purposes, on tribal and allotted Indian land and is the primary authority for leasing tribal and allotted lands for non-agricultural purposes.²³ 25 U.S.C. § 415 is the specific statutory authority for the Secretary to approve business leases on Indian land involving "the development or utilization of natural resources in connection with operations under such leases."²⁴ 25 U.S.C. § 415 authorizes leases for up to 25 years, with one renewal authorized for another 25 years for leases for public, religious, educational, recreational, residential, or business purposes. The statute also grants 99-year leasing authority to a number of tribes listed in the statute.²⁵

The regulations governing non-agricultural leases are found at 25 C.F.R. §§ 162.600.623 .²⁶ 25 C.F.R. § 162.604(g)(1) necessitates that a lessee's obligations under a lease are owed to the United States as well as to the owners of the land.²⁷ The BIA requires that this language be included in any non-agricultural lease entered into pursuant to its regulations. But, the

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regulatory language required to be included in all leases of Indian property does not indicate that the government intended to become contractually obligated as a party to the lease.²⁸ In Saguaro Chevrolet v. United States, the Court of Federal Claims concluded that the regulations pertaining to non-agricultural leases are nothing more than regulatory provisions that allow the United States to act in its long-standing role as guardian of Indian property.²⁹

Similarly, federal courts have consistently held that the exercise of the government's plenary power to safeguard Indian property does not involve the assumption of contractual obligations by the government.³⁰ In McNabb v. United States, the court stressed that the applicable statutes and regulations do not authorize the BIA to become a party to leases of trust land, but only provide the BIA with approval authority over those leases.³¹ In Saguaro Chevrolet, the court specifically stated that the non-agricultural leasing regulations do not create a "dual landlord provision."³² Rather, the...