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Trump Troubles?

Off-reservation land for casinos will slow under the new president

Trump Troubles?

American Indian efforts to reacquire and place in federal trust their ancestral lands—particularly acreage earmarked for new government casinos—will slow dramatically under the administration of President Donald Trump, Capitol Hill sources say.

Trump appointees with the Department of the Interior and Bureau of Indian Affairs (BIA) are rescinding tribal-friendly land-trust policies under Democratic President Barack Obama intended to help indigenous communities strengthen their governments and grow economies.

An April memo from newly appointed Interior Secretary Ryan Zinke ordered that all off-reservation land-trust applications be routed to Washington, D.C. headquarters for scrutiny by acting Deputy Secretary James Cason.

Cason, who served under former President George W. Bush, was the architect of stringent land-trust policies that caused a logjam of applications, particularly those for casinos on newly acquired lands.

Republican House and Senate leaders are also weighing in on what they call a need to make more strict Interior policy and regulations on placing land in federal trust for tribes.

Rep. Raul Labrador (R-Idaho), chairman of the House Subcommittee on Oversight and Investigations, accuses Interior of violating a 2009 Supreme Court decision in Carcieri v. Salazar. The ruling limits Interior’s authority to place land in trust for tribes not “under federal jurisdiction” with passage of the Indian Reorganization Act (IRA) of 1934.

Meanwhile, Rep. Rob Bishop (R-Utah), chairman of the House Resources Committee, in a February 17 letter to Cason demanded a freeze to “troubling determinations” by Interior on off-reservation casinos during the Obama-Trump transition.

“While the last-minute nature of these actions does not necessarily imply wrongdoing, it begs scrutiny,” Bishop said of land-trust decisions made in the last days of the Obama administration and soon after Trump’s election.

Interior approvals of trust land for casinos in the waning days of the Obama administration came with “little or no transparency” or notification of committee members who, Bishop said, “are on record expressing concerns with off-reservation gambling.”


Major Shift In Federal Indian Policy

Many Indian advocates fear Trump’s Interior—combined with congressional pushback to Obama land-trust policies—signals a major shift in tribal-federal relations that may diminish the sovereignty of indigenous governments.

They were particularly alarmed when Zinke, speaking at a May energy summit, called for an “off ramp” for natural resource tribes seeking to transition from governments under federal trusteeships to corporations.

“If tribes would have a choice of leaving Indian trust lands and becoming a corporation, tribes would take it,” Zinke said, noting that some 220 Alaska Native villages are organized as corporations.

Zinke’s remark harkens to past federal policies of terminating tribes and allotting land to individual Indians. More than 90 million acres of Indian land was lost in the allotment era that began in 1887 and ended with enactment of IRA in 1934.

“The confluence now—with Trump’s Interior and others in Congress wanting to make changes in the laws—is going to spell real trouble for us,” says attorney Bryan Newland, a former Interior counsel under Obama.


Tribal-Friendly Land-Trust Policies Are Ending

Some 630,000 acres were taken into federal trust for Indian governments and individuals during the Obama administration, according to Interior officials, bringing the nationwide total to 56.2 million acres. There also was a spike in the approval of land-trust applications for casinos.

With Trump taking office, tribal-friendly policies on land-trust decisions are ending.

“Taking off-reservation land into trust is going to be more scrutinized by the current administration, for gaming or any other purpose,” attorney and former Interior official George Skibine says.

“I think they’re just going to take a more cautious approach,” a Capitol Hill insider says of Interior officials. “They’re going to be careful. I don’t think they necessarily agree with Obama’s approach.”

Meanwhile, continued failure to get a legislative remedy to the controversial 2009 Supreme Court ruling in Carcieri v. Salazar makes the land-trust process more difficult.

“There is no movement on the legislation and we don’t expect it to happen anytime soon,” says Teresa Davis, communications director for Rep. Tom Cole (R-Oklahoma), who is leading the effort to get a congressional “fix” to the high court ruling.


Tribal Support For Change

The additional scrutiny of casino-related trust applications is embraced not only by state, county and municipal officials, but several tribes concerned with competition created by a mature and increasingly crowded Indian casino market.

“Are they going to be taking a closer look at some of these land-trust applications, particularly for off-reservation gaming? I think they are,” Larry Rosenthal, partner in Spirit Rock Consulting, says of Interior and BIA officials. “I don’t think off-reservation applications for non-gaming will be that much harder. But clearly, when it comes to gaming there will be more scrutiny. And for many tribes that will be a welcome relief.”

Tribal government gambling, a $30 billion industry, remains a catalyst for economic growth in Indian Country. But trust land for non-gambling purposes is also crucial to tribal self-governance. And many tribal lawyers and lobbyists loathe the end to Obama policies.

“I’m pessimistic,” says tribal attorney Michael McBride, “and the first point of pessimism is Michael Black,” the interim assistant secretary for Indian affairs who drafted the Zinke memo.

Black announced in April that off-reservation land-trust applications—for casinos or otherwise—would be routed through Interior’s Washington headquarters rather than processed in BIA regional offices. Only fee-to-trust applications for lands within reservation borders will be processed by regional offices.

“That’s a huge funnel that’s going to restrict the flow of those applications,” McBride says. “There have been so many resignations—and I don’t know about firings—that the office is not adequately staffed to handle the backlog of pending applications, much less the new ones.”

“I’m hopeful the administration continues the (fee-to-trust) process,” says an outgoing Interior official who requested anonymity. “I know there’s a lot of concern. The regional BIA offices were processing the vast majority of applications without much controversy. A lot of the non-gaming applications we didn’t get sued on.”

Newland says policies and regulations being discussed would essentially freeze Indian trust lands at their current levels. That would create hardships, particularly for tribes with limited land for housing, governmental infrastructure and economic development.

“They’re looking to remake the trust responsibility for tribes,” Newland says of Interior officials and members of Congress critical of Obama policies.

“The pressure is building to swing the pendulum back the other way. They’re looking to change things when it comes to Indian lands in a way that will hurt us.”

The fears expressed by Newland and others were heightened when Trump proposed draconian 10 percent budget cuts to BIA, Indian Health Service and housing programs for Indian communities, many crippled by cyclical poverty. Education programs are also slashed.

“President Obama may have spurred a backlash” against tribes, Kevin Washburn, assistant secretary of Indian affairs under Obama, says of Trump budget cuts and land-trust policies.

“Though tribes and the BIA now have a more than a half-million acres of new lands to manage, Trump seeks to slash $15 million from the real estate staff managing such lands,” Washburn says. “This will frustrate economic development by slowing approvals for leases and rights-of-ways. Trump would also slice $23 million from human services programs, including Indian child welfare.”

Skibine is less skeptical.

“There will be different priorities,” he says. “But the role of the Interior Department as trustee for the tribes will continue. The programs the new administration will generate as policy are going to generally try to help tribes achieve greater self-sufficiency.”


Land/Trust Progress Despite Carcieri

Washburn and his predecessor Larry Echo Hawk were applauded by Indian leaders for crafting an expedited land-trust process aimed at breaking a logjam created under the administration of President Bush. Bush was faulted for stonewalling decisions.

Washburn and Echo Hawk devised procedures to circumvent the 2009 U.S. Supreme Court ruling in Carcieri v. Salazar. Justices in Carcieri ruled that Interior could not place land in trust for tribes not “under federal jurisdiction” with passage of IRA in 1934. Justices did not define “under federal jurisdiction.”

The ruling impacted dozens of tribes granted federal recognition after IRA. Carcieri also prompted litigation tying up a number of land-trust applications.

Washburn delegated non-gambling land-trust decisions to BIA regional offices, which conducted legal determinations to meet Carcieri guidelines. Land-trust applications for casinos were routed directly to headquarters in Washington, D.C. for a ruling by Interior’s Office of the Solicitor.

Former Interior Solicitor Hilary Tompkins—one of several Native Americans serving in key positions with Obama’s administration—helped the process along by issuing a two-part review process for tribes granted federal recognition after 1934.

As a result, 630,000 acres was placed in federal trust for Indian governments and individuals. The total includes fee-to-trust lands within reservation borders, off-reservation land acquisitions and transfers of Bureau of Land Management (BLM) property to tribal authority.

House and Senate leaders are now seeking to trash Tompkins’ guidelines and replace them with regulations more in line with the Carcieri ruling. Labrador says Obama land-trust policies violated the congressional intent of IRA as interpreted in Carcieri.

“For too long, federal agencies have been permitted to disregard congressional intent and implement the laws Congress passes sometimes ignoring the law’s original purpose,” he says. “We must curb abuse by the executive branch and reassert power over the unelected bureaucracy.”

House Resources is also ending a $1.9 billion Interior land buy-back program aimed at consolidating and purchasing for tribal governments fractionized interest in reservation parcels. Obama and Trump officials dispute the effectiveness of the program.


Tribal Casino Growth Under Obama

Of the more than 2,400 land-trust applications processed under Obama, only about two dozen involved casinos.

The Indian Gaming Regulatory Act (IGRA) largely limits casinos to lands held in federal trust when the act was passed in 1988. There are some 480 Indian casinos nationwide.

There are, however, exceptions in Section 20 of IGRA to the 1988 limitations.

A “two-part determination” process allows tribes to open casinos on off-reservation trust lands with the approval of state governors. Tribes must prove off-reservation casinos benefit the tribe and are not detrimental to surrounding Indian and non-indigenous communities.

There also are “equal footing” exemptions in IGRA for newly recognized and restored tribes, land adjacent to existing reservations and property acquired through federal land settlements.


A Slow, Arduous Process

Getting trust land for casinos through any of the IGRA exemptions is an often difficult and expensive endeavor fraught with politics.

“While some tribes have been able to open new gaming facilities on land taken into trust, it can be a lengthy, costly and contentious process, with no guarantee of success,” says economist Alan Meister, author of the annual Indian Gaming Industry Report.

Since IGRA was enacted nearly 30 years ago, the BIA has processed 75 applications for new trust lands for casinos under Section 20 exemptions, according to Meister’s report.

Twenty-seven of the applications were approved during the Obama administration, Meister’s report says, including nine in 2015. Some decisions in California, Washington state, Arizona and elsewhere were opposed by non-Indian and tribal governments.

“Under the Obama administration, there was a higher rate of approvals of land-trust applications for gaming than in previous administrations,” Meister says. “That coincides with the anecdotal evidence that the administration was friendlier toward tribes.

“With the Trump administration there is no clear picture of how things are going to go. I think there is some uncertainty.”

Meister notes, however, that gambling land-trust applications are notoriously difficult regardless of presidential politics. This is particularly true with off-reservation, two-part determinations, which are more political.

“Almost 50 percent (of land-trust applications for gambling) fall into the category of off-reservation casinos, which are generally contested and harder to get approved,” Meister says. “They are going to have a difficult path, regardless of what the administration policy is.”

Twenty-three land-trust applications for gambling were pending with Interior as of March. Ten fit the category of off-reservation gambling. There were four applications for casinos on land contiguous to existing reservations, four for acreage acquired through federal land settlements and three from newly restored tribes.


An Ominous Policy

It’s not clear if Zinke’s memo foreshadows future Interior policy or whether it serves as a “placeholder” strategy pending the appointment of an assistant secretary and other high-ranking positions.

“There’s no political leadership there right now,” a lobbyist says. “They’re treading water. Nobody is ready to make policy decisions.”

“Zinke needs to have his full team there,” says the outgoing Interior official. “Once he has a full team we’ll see where they go with policies.”

Placing additional scrutiny on land-trust decisions should not be construed as being anti-Indian, sources say, particularly in light of the opposition from tribes to additional Indian casinos.

“I don’t think there is going to be a knee-jerk, anti-Indian posture from this administration,” Rosenthal says. “There are obviously going to be some different policy views with this administration. But Interior is not going to turn off the spigot on land-trust applications.

“The Obama administration made some decisions that were controversial. There was a call from Indian Country to bring more scrutiny to these trust applications.

“Most of the scrutiny will be toward off-reservation gaming,” Rosenthal says. “There are applications all over the country. Look at Michigan, California, Oklahoma, Arizona and New Mexico. This is clearly an issue that is not going away.”

Skibine also believes it is hasty to characterize the Zinke Interior as anti-Indian because of its heightened scrutiny of land-trust applications.

“I wouldn’t call it a political decision. I would call it policy decision,” he says. “When a new assistant secretary for Indian affairs comes on board, that person will set the tone.”


Taking On Carcieri

Congressman Cole, who is leading the fight to get a congressional “fix” to Carcieri, faces opposition from House and Senate leaders opposed to Indian casinos and others pressing for more local government involvement in the fee-to-trust process.

One of two Cole-sponsored bills would have merely affirmed the status of land recently taken into federal trust, preventing court challenges. Cole also sponsored legislation that would give Interior authority to place land in trust for tribes. Both bills generated strong opposition.

The federal courts in recent cases involving the Mashpee Wampanoag Indians of Massachusetts and the Cowlitz Tribe of Washington state issued contradictory decisions as to whether Interior has the authority to place land in trust for tribes recognized after IRA.

Cowlitz was recognized in 2002 and Mashpee in 2007. Both tribes contend they were “under federal jurisdiction” before 1934.

Skibine says the lack of a legislative “fix” to Carcieri creates “haves and have-nots” among the 567 federally recognized tribes and Alaska Native villages in Indian Country. But Dean Katherine Rand, of the University of North Dakota Law School, says the decision is embraced by congressional leaders opposed to Indian casinos.

“Folks put forward a fix, but it never gained traction in Congress, mainly because of the brakes this decision put on Indian gaming,” Rand told the Concord Journal. “I’d suggest the reasons are as political as they are legal. In today’s environment, any tribe looking to get land taken into trust is probably looking for a casino.”


Federal Indian Policy Going Forward

Indigenous leaders and lobbyists had expressed hope tribal economic progress would continue to grow under Zinke.

Those hopes were dashed with Trump’s proposed 2018 Interior budget, which slashes 10 percent—roughly $300 million—from Indian programs.

“President Trump’s budget proposal for programs affecting Indian Country is extremely troubling because of its disregard for the federal government’s responsibilities and its troubling lack of understanding of the challenges facing tribal communities,” Senator Tom Udall (D-New Mexico) said in a press release.

“I’m concerned that it would violate the federal government’s trust and treaty obligations to provide even basic health, education, public safety and other core services” to indigenous Americans, Udall said.

But a number of natural resource and energy tribes support Zinke policies. Interior officials point out that Zinke has more knowledge of indigenous governments than outgoing Interior Secretary Sally Jewell.

Skibine says Trump’s Interior has made rulings helpful to tribal governments, noting that Cason recently drafted a letter supporting efforts by the Mohegan and Mashantucket Pequot tribes to build a commercial casino in Connecticut.

“I think except for the off-reservation land acquisitions, where things may slow down, I’m not sure in any other areas there will be an anti-Indian approach,” Skibine says. “The Pequot-Mohegan letter would indicate that.”

Indian policy theorists note that it is the goal of Indian self-determination that tribes eventually free themselves of the paternalistic trust policies of Interior and the BIA.

And Indian advocates find solace that federal policy encouraging tribal self-determination has remained steadfast under several Republication administrations dating back to the late President Richard Nixon, who served from 1969 to 1974.

“Historically it’s been the Republican philosophy that the government closest to the people is the most efficient,” says a Washington lobbyist who requested anonymity. “That’s been a strong aspect of the Republican approach to tribal self-governance.

“Certainly in Congress there has been a strong level of support for that concept.”

Dave Palermo is an award-winning metropolitan newspaper reporter. He has written about American Indian governments for more than 20 years, working as an advocate for several tribes and tribal associations. He also has co-authored books on gambling and gambling law. He can be reached at