FEIS Appendices

July 2002 APPENDIX A JURISDICTION OVER ENERGY RESOURCE DEVELOPMENT ON THE SOUTHERN UTE INDIAN RESERVATION by: Thomas H. Shipps1 INTRODUCTION The coordinated undertaking of the Bureau of Land Management (BLM), Bureau of Indian Affairs (BIA), and Southern Ute Indian Tribe (SUIT) to prepare a comprehensive study of environmental impacts associated with tribal energy mineral development poses numerous challenges, not the least of which is mastering the complex jurisdictional principles at work on the Reservation. Some aspects of the Southern Ute jurisdictional maze are associated with developments in Indian law that are national in scope. Others derive from the unique history of the SUIT people and their reservation. A snapshot of the jurisdictional roles of federal, tribal, state and local governmental entities in relation to energy resource development on the Reservation may be helpful to those reviewing this document; however, debate or disagreement may accompany opinions about the precise limits of their governmental authority. While neither exhaustive nor definitive, this appendix is intended as a guide to those seeking a greater understanding of the jurisdictional aspects of federal development of reservation land and resources. THE FEDERAL TRUST RESPONSIBILITY Because of the pervasive role of the federal government in Indian affairs, a discussion of jurisdiction must include consideration of the federal trust responsibility. From the inception of the United States, the relationship between Indians and non-Indians has been a distinctly federal, rather than a state, governmental matter.2 The United States Constitution vests in the national government exclusive regulatory authority over commerce with Indian tribes.3 Judicial decisions construing that authority, as well as subsequent congressional enactments, have recognized a correlative federal duty of protection of Indian tribes, the “federal trust responsibility.” Thus, it is legally well established 1The author is a partner in the law firm of Maynes, Bradford, Shipps & Sheftel, which serves as general legal counsel for the SUIT. As the principal legal advisor to the SUIT on energy related issues, Mr. Shipps has participated in cases, administrative proceedings, negotiations and legislative drafting related to jurisdictional issues on the Southern Ute Indian Reservation. Additionally, he has been appointed under both the Bush and Clinton Administrations as a tribal representative on the Department of the Interior’s Royalty Management Advisory Committee. He also serves on the Indian Gas Valuation Negotiated Rulemaking Committee and the Secretary’s Royalty Policy Committee. 2 See Worcester v. Georgia, 31 U.S. (6 Pet.) 515, 561 (1832). 3 U.S. Const. art. I, § 8, cl. 3. Oil and Gas Development Final Environmental Impact Statement on the Southern Ute Indian Reservation A-1 Appendix A July 2002 that Indian tribes, in exchange for ceding vast territories and relinquishing their inherent powers of war and foreign diplomacy, secured federal governmental protection of tribal lands, much of which is legally held in trust by the United States for the benefit of specific tribes.4 Additionally, as quasi- sovereigns, tribes continue to possess the power to control their internal affairs, subject only to ultimate defeasance by Congress.5 Federal protection of tribal lands and the laws and regulations implementing that protection directly affect the manner in which tribal energy resources may be developed. Statutes initially enacted as far back as the 1790s continue to render void any sale or lease of tribal land, unless accomplished pursuant to treaty or congressional act.6 The Indian Mineral Leasing Act of 19387 and Indian Mineral Development Act of 19828 are two key statutes authorizing the leasing and development of tribal mineral resources. Under both of these acts, Congress requires tribal consent as a condition to the leasing of tribal lands. Under the earlier act, standard form leases written by the Department of the Interior were utilized in conjunction with an auction or bonus bid process in which interested industry representatives could compete for tribal mineral lease acreage. Under the Indian Mineral Development Act of 1982, tribes are encouraged to negotiate directly with industry companies. The customized minerals agreements generated by tribes under that act include everything from complex joint venture arrangements between companies and tribes to simple, negotiated leases similar to those authorized under the 1938 act. In addition to tribal leasing statutes, Congress has also authorized the leasing of Indian allotted land.9 These properties are held under trust patents by the United States or restricted patents under United States supervision for the benefit of individual Indians. The allotment process, which was discontinued by Congress in 1934, had been the bulwark of federal Indian policy for almost half a century. 10 It involved the distribution of small parcels of tribal acreage to individual tribal members for agricultural development. The balance of Reservation lands, known as “surplus” land, was then opened for non-Indian homesteading on many reservations. 4See, e.g., County of Oneida v. Oneida Indian Nation, 470 U.S. 226 (1985). 5 See generally Felix S. Cohen, Handbook of Federal Indian Law 229-257 (2d ed. 1982) (“Cohen”). 6 Nonintercourse Act of 1793 (codified as 25 U.S.C. § 177). 725 U.S.C. § § 396a, et seq. 825 U.S.C. § § 2101, et seq. 9 See, e.g., Act of March 3, 1909, 35 Stat. 781 (codified as 25 U.S.C. § 396). 10 Cohen at 127-143. Oil and Gas Development Final Environmental Impact Statement on the Southern Ute Indian Reservation A-2 Appendix A July 2002 Regardless of the particular statutory scheme, however, administration of Indian mineral leasing and development has been delegated by Congress to the Secretary of the Interior and is subject to a set of comprehensive federal regulations.11 Approval of leases and land record documents, such as assignments and communitization agreements, is the responsibility of the BIA.12 The BLM approves well density, underground activities, well operations, and resource measurement.13 A third Interior agency, the Minerals Management Service (MMS) oversees production, valuation accounting, and auditing. 14 Federal statutes15, regulations16, executive orders17, and case decisions18 require that tribes be given an opportunity to expand their governmental presence in all phases of Indian mineral development in cooperation with each of these federal agencies. Additionally, in keeping with the principle that tribes retained inherent authority to control their internal affairs unless divested by Congress, tribes have significant supplemental powers related to mineral development, including those of taxation and land use control.19 11 25 C.F.R. Parts 211, 212, 225 (1996). 12 25 C.F.R. § § 211.20 , 211.29, 225.22, 225.33 (1996). 13 25 C.F.R. § 211.3 (citing 43 C.F.R. Parts 3160, 3180, 3260, 3280, 3480 and 3590). 14 See Federal Oil and Gas Royalty Management Act of 1982 , 96 Stat. 2448 (codified as 30 U.S.C. § § 1701, et seq.). 15 E.g., 30 U.S.C. § 1732 (authorizing cooperative audit agreements between MMS and tribes regarding tribal lands); e.g., Indian Self-Determination Act of 1975, Pub. L. No. 93-638 (codified at 25 U.S.C. § § 450f-450n) (permitting tribes to contract to perform Indian program services of the Departments of the Interior and Health and Human Services). 16 E.g., 25 C.F.R. § 211.29 (authorizing Indian Reorganization Act tribes to enact tribal laws superseding those contained in 25 C.F.R. Part 211). 17 E.g., United States President, Memorandum for the Heads of Executive Departments and Agencies (Apr. 29, 1994); United States Department of the Interior, Departmental Responsibilities for Indian Trust Resources, Order No. 3175 (Nov. 8, 1993) (requiring consultation with tribes prior to issuing policy directives affecting tribes and their resources). 18 E.g., City of Albuquerque v. Browner,97 F.3d 415 (10th Cir. 1996) (recognizing authority of Pueblo of Isleta to promulgate water quality standards applicable to upstream municipality). 19 E.g., Merrion v. Jicarilla Apache Tribe, 455 U.S. 130 (1982). Oil and Gas Development Final Environmental Impact Statement on the Southern Ute Indian Reservation A-3 Appendix A July 2002 Thus, the basic structure of Indian mineral leasing and development flows from the power and responsibility of the federal government to protect Indian lands and to take such action as serves the best interests of Indian constituents. Tribes are encouraged to assume an increasing role in the day- to-day and long-range management of their own resources. In that regard, over the last decade, the SUIT has taken major steps to manage development of its energy resources in cooperation with its federal trustee. THE SOUTHERN UTE INDIAN RESERVATION The present-day Reservation is a remnant of a much larger territory: approximately the western third of the state of Colorado, which was set aside for the confederated Ute bands in 1868.20 Expanding western settlement throughout the late nineteenth and early twentieth centuries, coupled with ever- changing federal Indian policies, resulted in the substantially reduced current Reservation.21 By federal statute, all lands within the boundaries of an Indian reservation, regardless of ownership, are deemed to be part of “Indian Country,”22 the territory within which Indian tribes may exercise certain governmental powers.23 Determining the boundaries of reservations

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