Recent proposed regulations seek to streamline and reduce costs for tribal land into trust applications and clarify parameters for negotiation and approval of tribal-state gaming compacts.

The administrative process by which tribal nations obtain trust status for land to conduct off-reservation gaming or other activities has been criticized by some as cumbersome, lengthy, and overly burdensome.^[1] The process of negotiating and approving compacts that tribes must enter into with states to conduct gaming activity has also received its share of criticism.^[2] With recent proposed regulatory amendments to 25 Code of Federal Regulations (CFR) parts 151 and 293, the Biden Administration seeks to make both of these processes more favorable to tribes and to economic development through gaming.

Background

In 1934, Congress gave the U.S. Department of the Interior (DOI) the power to take land into trust for individual Native persons or tribes through the Indian Reorganization Act (IRA).^[3] The purpose of this Act was to allow tribes to reclaim lands that may have been removed from tribal ownership to be used to “strengthen self-determination and sovereignty.”^[4] The land into trust or fee-to-trust process allows DOI to hold land that the tribe owns for the tribe’s benefit, essentially converting it into the tribe’s reservation.^[5] The benefits of trust status include sovereign immunity within the bounds of the land; freedom from state and local jurisdiction; exemption from taxation of the land; new market tax credits; Indian employment tax credits; tax-exempt financing; discounted leasing rates; federal contracting preferences; foreign trade zone customers duty deferral, elimination or reduction; state/county land use exemptions; and accelerated depreciation for business property on the land.^[6] Trust land is particularly important for tribes looking to conduct gaming activity: a tribe can only conduct Class III (Las Vegas-style) gaming activities on non-reservation lands acquired after 1988 which are taken into trust and which otherwise satisfy the Indian Gaming Regulatory Act (IGRA).^[7]

In order to be eligible for trust land, a tribe must be federally recognized and have been “under Federal jurisdiction” in 1934.^[8] Regulations codified at 25 CFR part 151 govern this land into trust process, and require a detailed application demonstrating eligibility for trust land through historic evidence, consultation with state and local officials with regulatory jurisdiction over the land to be acquired, and compliance with the National Environmental Policy Act (NEPA). They also give the public an opportunity to comment on socioeconomic impacts during the NEPA process.^[9]

Once a tribe has secured trust status for its land, it must comply with IGRA to conduct Class III gaming on the land.^[10] Under IGRA, regardless of whether the land is in trust or part of the tribe’s reservation, a tribe must enter into a business agreement or “compact” with the state where the gaming activity is to take place.^[11] 

The Proposed Regulations

On Dec. 5, 2022, DOI’s Office of the Assistant Secretary for Indian Affairs published proposed amendments to the regulations governing the land into trust process (25 CFR part 151) and Class III tribal-state gaming compacts (25 CFR part 293) after consideration of comments from the tribal community. These proposed revisions were first announced at the 2022 White House Tribal Nations Summit, held on Nov. 30 and Dec. 1, 2022. Secretary Bryan Newland stated that the goal of both sets of proposed amendments is to make this process “easier” for tribes that have faced barriers with the system, whether they be costs, delays, or the complexity of the decision-making process.^[12] This proposal builds upon the Secretary of the Interior, Deb Haaland’s approach, which contrasts with that of the prior administration, to streamline the land into trust process by returning approval authority to the Bureau of Indian Affairs (BIA) regional directors and provide clarity on the compacting process.^[13]  

Land into Trust Process

The proposed revisions to the land into trust process impose a mandatory maximum of 120 days for DOI to decide on a completed application; a new, more supportive method of acquisition called “initial Indian acquisition” for tribes who do not currently possess any trust land; and a scaling back of obstacles and review criteria for applicants, such as anticipating only one Phase I Environmental Site Assessment.^[14] Under the existing regulations, there was no prescribed length of time for a decision,^[15] so this new expediency is significant, particularly for tribes that have waited years, and sometimes decades, to have their land taken into trust. For example, in 2020, the Cayuga Nation sued DOI in federal court while awaiting a decision on an application submitted in 2005.^[16] 

The land into trust revisions create a new “presumption” of approval of a trust land application for on-reservation acquisitions, acquisitions contiguous to a reservation, and initial acquisitions, which will simplify and streamline the process for tribes looking to acquire land already set aside by the federal government for their tribe or for those looking to acquire trust land for the first time, even if off-reservation.^[17] This is intended to affirm that the land is for the welfare and use of the tribe, as well as to address the historical impact of removal of reservation land by the U.S. government.^[18] Under the proposed revisions, DOI will no longer invite state and local government comment for on-reservation acquisitions only.^[19] In making all trust land determinations under the proposed scheme, DOI will give “great weight” to important purposes for tribal welfare, e.g., protecting tribal homelands.^[20] 

For off-reservation (non-contiguous) acquisitions, DOI proposes to dispense with the so-called “bungee cord” approach of limiting approval the further the land extends from a tribe’s reservation.^[21] Location will be considered in the Secretary’s “holistic analysis” in consideration of state and local government comments.^[22] Initial acquisitions will no longer include any consideration of location except in response to state and local comments.^[23] If these proposed changes go into effect, they are likely to give more significance to IGRA’s requirements around proximity to a tribe’s historic lands, reservation, or other trust land in the tribal gaming context.^[24]

These revisions to the land into trust process attempt to clarify the term “under Federal jurisdiction” in the IRA’s definition of eligible Indians, which has been the subject of protracted litigation.^[25] By way of background, in the DOI Solicitor’s Office Opinion M-37029 (the M-Opinion), which was revoked by the prior presidential administration and reinstated on April 27, 2021, DOI outlined its guidance for what it means to be “under federal jurisdiction” in response to the seminal U.S. Supreme Court opinion in Carcieri v. Salazar.^[26] Carcieri held that the Secretary of the Interior could not take land into a trust for the Narragansett Tribe because it was not under federal jurisdiction in 1934 at the time of the IRA’s passing.^[27] Under the M-Opinion, to be considered “under Federal jurisdiction,” a tribe must (1) have been subject to an action or series of actions “that generally reflect federal obligations, duties, responsibility for or authority over the tribe by the Federal Government” and (2) had active jurisdictional status in 1934.^[28] The M-Opinion discusses specific examples of evidence that would be considered probative of a tribe’s jurisdictional status to varying degrees.^[29] However, application of these evidentiary guidelines from the M-Opinion has not always been consistent, leading to judicial intervention and review further delaying the approval process for tribes.^[30]

The proposed revisions to Section 151.4 include three ways of demonstrating a tribe’s jurisdictional status under the IRA vis-à-vis the federal government:

1. Conclusive evidence, such as a treaty ratified by the United States and still in effect in 1934 or a vote under Section 18 of the IRA (no further analysis needed);

2. Presumptive evidence, which includes evidence of treaty negotiations with the United States or federal legislation for a specific tribe acknowledging a government-to-government relationship in or before 1934 (further analysis only as to evidence of existence of Federal jurisdiction in 1934); and

3. Probative evidence, which is an act or series of acts that when viewed in concert establish Federal responsibility or authority over the tribe that remained intact in 1934, e.g., attendance of tribal members at BIA operated schools or the provision of health and social services to a tribe or tribal members. Once this evidence has been provided, it is the responsibility of the Secretary to determine whether the tribe has (1) been subject to federal obligation or authority and (2) had an active jurisdictional status in 1934.^[31]

These categories are more specific than the M-Opinion guidance, although the third category still allows for the type of broad discretion that DOI has been employing for this determination under current practice. If this test goes into effect, it will not disturb prior determinations that a particular tribe was under Federal jurisdiction per the IRA.^[32] Tribes with pending applications will be able to opt to proceed under the proposed regulations, but will not get the benefit of the 120-day timeline.^[33]

In addition, the proposed revisions make clear that judicial and legislative trust land determinations are not subject to the part 151 process.^[34]

Tribal-State Gaming Compact Process

The proposed revisions to the Class III tribal-state gaming compacts regulation synthesize the current practices and policies of the BIA to clarify the existing negotiation and approval process. DOI seeks to accomplish this by: 

• adding seven new definitions: gaming activity or gaming activities, gaming facility, gaming spaces, IGRA, meaningful concession, substantial economic benefit, and Tribe;

• creating a process for determining if a document is an “agreement” or an “amendment”;

• requiring that an intergovernmental agreement to extend the term of the agreement must be published in the Federal Register to be in effect;

• requiring submission of additional documents, including any agreements between a tribe and a state that require the tribe to make payments to the state or restrict or regulate its use of Indian Lands, with gaming compacts or amendments;

• codifying the issuance of letters notifying parties of acceptance by law after 45 days in accordance with IGRA, that, when applicable, will provide guidance on provisions that are inconsistent with the Department’s interpretation of IGRA, thus allowing the consistent provisions to become effective upon publishing in the Federal Register; and

• adding 15 new sections codifying the narrow scope of compact negotiations, considering the limited list of topics appropriate for a tribal-state gaming compact as outlined in IGRA.^[35]

Additionally, DOI introduced a notable policy to promote the modernization of tribal gaming through remote wagering and internet gaming (together, i-gaming) by tribes in these proposed revisions.^[36] This is in part a response to a recent federal district court decision invalidating a compact between the state of Florida and the Seminole Tribe for allowing mobile betting in violation of IGRA.^[37] DOI proposed a new section in the regulations that would allow compacts between states and tribes to include provisions addressing and allowing i-gaming. Specifically, the proposed revision allows for i-gaming outside of Indian Lands if:

1. state law, the compact, or an amendment deem the gaming to be taking place on the tribe’s Indian lands where the server accepting the bets is located;

2. the tribe regulates the gaming; and

3. the participant initiating the wager is not located on another tribe’s land.

This new i-gaming policy could create a potential conflict with IGRA, as IGRA only allows the Secretary to approve gaming on Indian Lands.^[38] In West Flagler Associates v. Haaland, the plaintiffs argued that the State of Florida and the Seminole Tribe improperly circumvented IGRA in their tribal-state compact by “deeming” that all mobile bets would take place on the Tribe’s reservation land so long as they passed through the Tribe’s servers on such land, even when they were placed on non-reservation lands.^[39] The U.S. District Court for the District of Columbia held that the Secretary lacked authority to approve the compact because it authorized gaming off of tribal lands.^[40] The case is currently pending decision of the U.S. Court of Appeals for the D.C. Circuit.^[41] 

As in the compact at issue in West Flagler, the proposed tribal-state gaming compact regulation revisions similarly appear to authorize gaming outside the scope of IGRA.^[42] DOI is taking the position that its proposed i-gaming provision is permissible (at least when a player is not physically on another tribe’s Indian lands) because IGRA allows negotiation related to the application of criminal and civil laws and allocation of criminal and civil jurisdiction.^[43] If adopted, this proposed provision appears ripe for further litigation in this area.

The Path Forward

The proposed revisions to the land-to-trust and tribal-state gaming compact regulations share the common objective of making it easier for tribes to acquire trust land and pursue the development of a gaming establishment. These changes will not remove the risk of litigation over trust land acquisitions, however, especially in the gaming context. While DOI’s offer to limit the decision-making period for trust land is a positive step for tribes, Administrative Procedure Act challenges by citizens or competitors and other legal disputes can still cause significant delays in the ability to use trust land and develop gaming facilities once acquired. 

As a next step, the BIA will host three total Tribal consultation sessions, two virtual and one in-person, to obtain input on the proposed regulatory changes. They will be open to tribal leadership and representatives from federally recognized Indian Tribes and Alaska Native Corporations. The BIA is also soliciting feedback from the public through email (consultation@bia.gov) until 11:59 p.m. EST on March 1, 2023.^[44]

With more than 950 attorneys across its 31 offices and counting, Nelson Mullins has an experienced team of American Indian law, gaming and government relations attorneys who regularly advise clients on these types of matters. Tribes, Native organizations, and individuals that are interested in commenting on these proposed regulations or applying for a land into trust application or Class III tribal state gaming compact should retain qualified counsel to assist them with the process and ensure compliance with applicable law.

FOOTNOTES

^[1] E.g., Land, Trust, and Natural Resource Management: Hearing Before the H. Approp. Comm., Subcomm. on Interior, Env’t, and Related Agencies, 116th Cong. 1 (2020) (statement of Gov. Reggie Wassana, Cheyenne and Arapaho Tribes); U.S. Dept. of Int., Bureau of Indian Aff., Indian Affairs proposes new regulations to improve fee-to-trust, gaming compact processes (Dec. 5, 2022), https://www.bia.gov/news/indian-affairs-proposes-new-regulations-improve-fee-trust-gaming-compact-processes; Philip Marcelo, WBUR, Massachusetts Tribe Earns Federal Land In Trust Status (Sept. 18, 2015), https://www.wbur.org/news/2015/09/18/mashpee-land-approval; Cayuga Nation of New York, Indian Nation Sues Federal Government for 15-Year Delay on Trust Land Application, Cayuga Nation News (June 16, 2020), https://cayuganation-nsn.gov/news/indian-nation-sues-federal-government-for-15-year-delay-on-trust-land-application.

^[2] See Class III Tribal Gaming Compacts, 87 Fed. Reg. 74916, 74917-18 (Dec. 6, 2022) (discussing comments on proposed rulemaking).

^[3] Indian Reorganization Act of 1934, 25 U.S.C. §§ 5101-5129 (2022).                                                                                  

^[4] Land Acquisitions, 87 Fed. Reg. 74334, 74341 (Dec. 5, 2022) (to be codified at 25 CFR pt. 151).

^[5] 25 U.S.C. §§ 5108 and 5110.

^[6] U.S. Dept. of Int., Bureau of Indian Aff., Benefits of Trust Land Acquisition (Fee to Trust), https://www.bia.gov/service/trust-land-acquisition/benefits-trust-land-acquisition; U.S. Dept. of Int., Bureau of Indian Aff., Fee to Trust Land Acquisitions, https://www.bia.gov/bia/ots/fee-to-trust.

^[7] IGRA, 25 U.S.C. § 2719 (2022).

^[8] 25 U.S.C. § 5129.  Alternatively, tribes may be descendants of members who were federally recognized and under Federal jurisdiction in 1934 or of “one-half or more Indian blood.”  Id.

^[9] 25 C.F.R. § 151.8 (2022).

^[10] 25 U.S.C. § 29.2710(d).

^[11] 25 U.S.C. § 29.2703.

^[12] U.S. Dept. of Int., Bureau of Indian Aff., Indian Affairs proposes new regulations to improve fee-to-trust, gaming compact processes (Dec. 5, 2022), https://www.bia.gov/news/indian-affairs-proposes-new-regulations-improve-fee-trust-gaming-compact-processes.

^[13] U.S. Dept. of Int., Office of the Secretary, Order No. 3400, Delegation of Authority for Non-Gaming Off-Reservation Fee-to-Trust Acquisitions (April 27, 2022); U.S. Dept. of Int., Bureau of Indian Aff., Indian Affairs to Host Tribal Consultations on Changes to Fee-to-Trust & Gaming Compact Regulations (Mar. 29, 2022), https://www.bia.gov/news/indian-affairs-host-tribal-consultations-changes-fee-trust-gaming-compact-regulations.

^[14] Land Acquisitions, 87 Fed. Reg. 74334, 74335 (Dec. 5, 2022).

[15] See id.

^[16] Cayuga Nation of New York, Indian Nation Sues Federal Government for 15-Year Delay on Trust Land Application, Cayuga Nation News (June 16, 2020), https://cayuganation-nsn.gov/news/indian-nation-sues-federal-government-for-15-year-delay-on-trust-land-application.

^[17] See Land Acquisitions, 87 Fed. Reg. 74334, 74336 & 74344 (Dec. 5, 2022) (proposed 25 CFR § 151.3).  In addition, no policy reasons are required for the acquisition where the tribe already owns an interest in the land.  Id.

^[18] See id. at 74337-38 (proposed 25 CFR § 151.9).

^[19] See id. at 74338.

^[20] See id. (proposed 25 CFR § 151.10-12).

^[21] See id. (proposed 25 CFR § 151.11).

^[22] See id.

^[23] See id.

^[24] See 25 U.S.C. § 2719.

^[25] See, e.g., Carcieri v. Norton, 290 F. Supp. 2d 167 (D.R.I. 2003), aff'd, 398 F.3d 22 (1st Cir. 2005), opinion withdrawn and superseded on reh'g, 423 F.3d 45 (1st Cir. 2005), reh'g en banc granted, opinion withdrawn (Dec. 5, 2006), on reh'g en banc sub nom. Carcieri v. Kempthorne, 497 F.3d 15 (1st Cir. 2007), rev'd sub nom. Carcieri v. Salazar, 555 U.S. 379, 129 S. Ct. 1058, 172 L. Ed. 2d 791 (2009), and aff'd sub nom. Carcieri v. Kempthorne, 497 F.3d 15 (1st Cir. 2007), and rev'd sub nom. Carcieri v. Salazar, 555 U.S. 379 (2009); Confederated Tribes of Grand Ronde Cmty. of Oregon v. Jewell, 75 F. Supp. 3d 387, 401 (D.D.C. 2014), aff'd, 830 F.3d 552 (D.C. Cir. 2016); Littlefield v. U.S. Dept. of Int., 1:22-cv-10273-AK (D. Mass. 2022); Mashpee Tribe v. Zinke, No. CV 18-2242 (RMC), 2019 WL 2569919, *1-8 (D.D.C. June 21, 2019).

^[26] U.S. Dept. of Int., Office of the Solicitor, M-37029, The Meaning of "Under Federal Jurisdiction" for Purposes of the Indian Reorganization Act (2014); 555 U.S. 379 (2009).

^[27] Carcieri, 555 U.S. at 382.

^[28] U.S. Dept. of Int., Office of the Solicitor, M-37029, The Meaning of "Under Federal Jurisdiction" for Purposes of the Indian Reorganization Act, 19 (2014).

[29] See id. at 19-20.

^[30] See, e.g., Mashpee Tribe v. Bernhardt, 466 F. Supp. 3d 199, 235-36 (D.D.C. 2020), appeal dismissed, No. 20-5237, 2021 WL 1049822 (D.C. Cir. Feb. 19, 2021) (holding that Secretary of Interior improperly applied M-Opinion test in decision after remand denying Mashpee Tribe land into trust by viewing evidence of Mashpee students attending BIA schools and receiving federal services there, three different census reports, and federal reports and surveys in isolation rather than “in concert”); Citizens for a Better Way v. U.S. Dep't of Interior, No. 2:12-CV-3021-TLN-AC, 2015 WL 5648925, at *22 (E.D. Cal. Sept. 24, 2015), aff'd sub nom. Cachil Dehe Band of Wintun Indians of Colusa Indian Cmty. v. Zinke, 889 F.3d 584 (9th Cir. 2018) (upholding Secretary of Interior’s determination that the Estom Yumeka Maidu Tribe of the Enterprise Rancheria were under Federal jurisdiction, which applied the M-Opinion test, based in part on evidence of Section 18 election).

^[31] Land Acquisitions, 87 Fed. Reg. 74334, 74342 (Dec. 5, 2022) (proposed 25 CFR § 151.4).

^[32] See id. at 74336 (proposed 25 CFR § 151.4(c)).

^[33] See id. at 74339 (proposed 25 CFR § 151.17).

^[34] See id. at 74336 (proposed 25 CFR § 151.4(e)).

^[35] Class III Tribal State Gaming Compacts, 87 Fed. Reg. 74916, 74916-74947 (Dec. 6, 2022).

^[36] See id. at 74919, 74947 (proposed 25 CFR § 293.29).

^[37] See, e.g., W. Flagler Assocs. v. Haaland, 573 F. Supp. 3d 260, 275 (D.D.C. 2021), appeal filed sub nom. W. Flagler Assocs. v. Haaland, No. 21-5265, 22-5022, (D.C. Cir. Nov. 23, 2022) (holding that compact between Florida and Seminole tribe authorizing i-gaming throughout the state violated IGRA’s “Indian lands” guideline by allowing gaming off of tribal lands).

^[38] See W. Flagler Assocs., 573 F. Supp. 3d at 275; 25 U.S.C. § 2710 (d)(8)(a).

^[39] See W. Flagler Assocs., 573 F. Supp. 3d at 273.

^[40] See id. at 275.

^[41] See W. Flagler Assocs. v. Haaland, No. 21-5265, 22-5022, (D.C. Cir. Nov. 23, 2022).

^[42] See Class III Tribal State Gaming Compacts, 87 Fed. Reg. 74916, 74947 (Dec. 6, 2022).

^[43] See id. at 74919 (proposed 25 CFR § 293.29).

^[44] U.S. Dept. of Int., Bureau of Indian Aff., Indian Affairs proposes new regulations to improve fee-to-trust, gaming compact processes (Dec. 5, 2022), https://www.bia.gov/news/indian-affairs-proposes-new-regulations-improve-fee-trust-gaming-compact-processes.