Tribal Government Considerations Regarding the New BIA Right-of-Way Regulations
In November 2015, the Bureau of Indian Affairs (BIA) published a final rule adopting updated regulations for rights-of-way on Indian trust and restricted land (New Regulations). 80 Fed. Reg. 72534 (Nov. 19, 2015)(codified at 25 C.F.R. Part 169). The pre-existing regulations had not been updated since 1980. The New Regulations, which went into effect April 21, 2016, apply to tribally owned land as well as individually owned Indian land. The New Regulations support tribal control of trust land through broader consent requirements, increased compliance and enforcement opportunities for tribes, and affirmation of tribal jurisdiction and regulatory authority.
Tribal consent to any new right-of-way crossing tribal trust land has long been a requirement of the regulations; for individually owned Indian lands, landowner consent has also long been required except in certain circumstances. See former 25 C.F.R. § 169.3. The New Regulations have extended this requirement to assignments, mortgages, and piggybacking. If a right-of-way grantee wants to assign or mortgage the right-of-way to another person or entity, the grantee must obtain the consent of the landowner. 25 C.F.R. §§ 169.207, 169.210. Certain amendments of the original right-of-way are also subject to obtaining landowner consent. 25 C.F.R. § 169.204. If the tribe is the landowner, then the grantee must obtain the consent of the tribe.
The BIA has published a guidance document in which it has taken the position that provisions of the New Regulations that are procedural apply retroactively to existing rights-of-way, unless the language of the original right-of-way grant document or the statutory authority provides otherwise. 81 Fed. Reg. 19877 (Apr. 6, 2016). The BIA list includes the provisions governing the assignment or mortgaging of a right-of-way. Many rights-of-way that were granted before the New Regulations came into effect do not address the issues of assignments and mortgages, thus the New Regulation applies to those existing rights-of-way in the same manner as they do for new rights-of-way.
Piggybacking, also known as franchising, also requires landowner consent under the New Regulations. 25 C.F.R. §§ 169.127, 169.128. This rule marks a change in the management of rights-of-way in Indian country. Through piggybacking, right-of-way grantees allow other entities to use the right-of-way for other uses. For example, within an existing right-of-way for a county road, the grantee allows water, sewer, gas, power, and phone or cable lines. Prior precedent held that the grantee could allow piggybacking on rights-of-way on trust land if permissible under state law. Under the New Regulations, however, piggybacking is only authorized with the consent of the landowner. Like mortgages and assignments, this is a procedural rule that applies to existing rights-of-way unless the right-of-way grant or statutory authority allows piggybacking without landowner consent.
Compliance and Enforcement
The New Regulations expressly provide that rights-of-way are subject to tribal law, unless tribal law is inconsistent with applicable federal law; the grant of a right-of-way does not diminish tribal authority to enforce tribal law on rights-of-way on the reservation. 25 C.F.R. §§ 169.9, 169.10. The pre-existing regulations were silent on the subject of tribal lawmaking authority. Tribes can also compact or contract with the federal government under the Indian Self-Determination and Education Assistance Act (25 U.S.C. § 450 et seq.) to investigate and monitor compliance with the terms of the right-of-way grant and federal regulations. 25 C.F.R. § 169.8. In addition, any landowner can pursue remedies for breach of the terms of a right-of-way grant under tribal law under 25 C.F.R. § 169.405(d). This provision reinforces the common law right of the landowner, whether it is a tribal or individual landowner, to bring an action for compliance or enforcement of a right-of-way grant. A few common compliance issues that tribes may want to consider are compliance with the terms of the right-of-way grant, including payment provisions, and compliance with the procedural regulations for assignment, amendment, mortgaging, and piggybacking, as discussed above.
Tribes may also want to investgate service line agreements that have been executed on the trust land. The old regulations were somewhat vague as to service line agreements. See pre-existing regulations at 25 C.F.R. § 169.22. The term “service line” was not defined but included distribution lines for telephone, water, electric power, gas, and other utilities. A service line agreement did not require BIA approval but was supposed to be filed with BIA after execution. Under the old regulations, a service line agreement may have been executed in lieu of a right-of-way either because the entity involved used a broad interpretation of the term “service line agreement” or because using a service line agreement avoided the need for BIA approval and was thus deemed a quicker way of providing utility service. Although service line agreements were supposed to be filed with BIA, they often not recorded at the BIA Land Title and Records Office (LTRO), and so may not appear on title records and copies may not be available at LTRO. The New Regulations provide much needed clarification regarding when to use a service line agreement versus when to use a right-of-way, specify issues that should be addressed, and define a process for entering into service line agreements where there had been none. 25 C.F.R. §§ 169.051-169.056. With these changes, there is likely a lot of work that can be done by tribes to identify existing service line agreements, correct any deficiencies, and have them recorded by LTRO, which is now required.
Jurisdiction and Regulatory Authority
Under the New Regulations, BIA recognizes that tribes have law-making authority over rights-of-way on trust land within their reservations and that the grant of a right-of-way does not diminish tribal jurisdiction. 25 C.F.R. §§ 169.9, 169.10. This marks an important interpretation of the holding in Strate v. A-1 Contractors, 520 U.S. 438 (1997). The Court in Strate held that the tribal court did not have jurisdiction over a civil suit that arose from an accident that occurred on a state highway right-of-way on the reservation. As explained in the preamble of the final rule:
In Strate, neither the Federal Government nor the tribe [had] expressly reserved jurisdiction over the land in the grant of the right-of-way. This lack of a ‘gatekeeping right’ led the Supreme Court to consider the right-of-way as aligned, for purposes of jurisdiction, with land alienated to non-Indians. In these regulations, as grantor, is preserving the tribes’ jurisdictions in all right-of-way grants issued under these regulations and is requiring that such grants expressly reserve tribal jurisdiction. Therefore, grants of rights-of-way under these regulations, consistent with the Court’s reasoning in Strate, would not be equivalent to fee land, but would retain the jurisdictional status of the underlying land.
80 Fed. Reg. at 72494 (citations omitted). Thus, for rights-of-way granted under the New Regulations, the holding in Strate does not operate to divest tribes of authority to enforce tribal law on trust land within their reservations, and tribal court civil jurisdiction over rights-of-way should be similarly unaffected.
Tribal power to tax on rights-of-way on trust land on the reservation is also affirmed under the New Regulations, which recognize that improvements and activities within the right-of-way, and the right-of-way interest itself “may be subject to taxation by the Indian tribe with jurisdiction,” unless tribal law is inconsistent with applicable federal law. 25 C.F.R. § 169.11(b). Improvements, activities, and rights of way interests are not subject to state taxation. 25 C.F.R. § 169.11(a). The preamble includes an extensive discussion of relevant decisions of the U.S. Supreme Court, in which, applying the balancing test under White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 143 (1980), BIA concluded, “The Federal statutes and regulations governing rights-of-way on Indian land occupy and preempt the field” such that state taxation is precluded. 80 Fed. Reg. at 72505.
It is important to note that the tax provisions of the New Regulations are quite similar to the tax provisions in the revised BIA regulations governing leasing of Indian trust and restricted lands, which went into effect in January 2013. 25 C.F.R. § 162.017. Like the right-of-way regulations, the tax provisions in the leasing regulations are supported by discussion in the preamble in which BIA applied the Bracker balancing test and found the field to be preempted by the federal statutory and regulatory scheme, precluding taxation by states. 77 Fed. Reg. 72440, 72447 (Dec. 5, 2012). In a case in which the tax provisions of the leasing regulations were challenged, the court treated the BIA’s demonstration of strong federal and tribal interests as entitled to deference in Bracker balancing and ruled in favor of the Tribe. Seminole Tribe v. Stranburg, 799 F. 3d 1324 (11th Cir. 2015).
The New Regulations support tribal self-government through greater opportunities for tribal management and control of trust lands and explicit recognition of tribal authority on the reservation. Tribes would be well served by taking advantage of this opportunity by undertaking a full inventory and analysis of current rights-of-way and service line agreements, and by adopting and implementing tribal tax and regulatory laws on the reservation.
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