A bill to provide for the settlement of the water rights claims of the Fort Belknap Indian Community STATEMENT OF BRYAN NEWLAND ASSISTANT SECRETARY FOR INDIAN AFFAIRS, UNITED STATES DEPARTMENT OF THE INTERIOR BEFORE THE COMMITTEE ON INDIAN AFFAIRS UNITED STATES SENATE July 12, 2023 Aanii (Hello)! Good afternoon, Chairman Schatz, Vice Chairman Murkowski, and Members of the Committee. My name is Bryan Newland. I am the Assistant Secretary for Indian Affairs at the Department of the Interior (Department). Thank you for the opportunity to present testimony regarding S. 1987, Fort Belknap Indian Community Water Rights Settlement Act of 2023. The Department supports S. 1987 and suggests some technical changes to aid in its implementation. Introduction The United States acts as a trustee for the land and water rights of Tribes, American Indians, and Alaska Natives. The United States has a trust responsibility to Indian Tribes and Indian people and consistent with that has charged itself with moral obligations of the highest responsibility and trust. These obligations are at their greatest when it comes to protecting the ability of Tribes, and their citizens, to maintain their existence on lands the United States holds in trust for their benefit. The Biden Administration recognizes that water is essential for people to lead healthy, safe, and fulfilling lives on Tribal lands. Water is the among the most sacred and valuable resources for Tribal nations. The Administration further recognizes that long-standing water crises continue to undermine public health and economic development in Indian Country. The Administration strongly supports the resolution of Indian reserved water rights claims through negotiated settlements. Indian water settlements protect the senior water rights reserved by Tribal Nations and help ensure that the citizens of these Nations have reliable and safe water for drinking, cooking, and sanitation; improve the public health and environment on reservations; enable economic growth; promote Tribal sovereignty and self-sufficiency; and help fulfill the United States’ trust responsibility to Tribes. At the same time, water rights settlements have the potential to end decades of conflict and contention among Tribal Nations and neighboring communities and promote cooperation in the management of water resources. Congress plays an important role by enacting legislation to ratify Indian water rights settlements. We stand ready to work with this Committee and Members of Congress to advance Indian water rights settlements and uphold our sacred trust obligations to Indian country. We have a clear charge from the President and Secretary Haaland to protect Tribal reserved water rights and improve water access and water quality on Tribal lands. To that end, the Biden Administration’s policy on negotiated Indian water settlements continues to be based on the following principles: the United States will participate in settlements consistent with its trust responsibilities to Tribal Nations; Tribes should receive equivalent benefits for rights which they, and the United States as trustee, may release as part of the settlement; Tribes should realize value from confirmed water rights resulting from a settlement; and settlements should contain appropriate cost-sharing proportionate to the benefits received by all parties benefiting from the settlement. In addition, settlements should provide finality and certainty to all parties involved. I. S. 1987 S. 1987, Fort Belknap Indian Community Water Rights Settlement Act of 2023 would approve and provide authorizations to carry out the settlement of the Tribes’ water rights in the State of Montana (State). The Department supports resolving the Tribes’ water rights claims through a comprehensive settlement. a. Reservation and Historical Background Congress established the Fort Belknap Indian Reservation (Reservation) in 1888 to secure a homeland for what are now the Assiniboine (Nakoda) and Gros Ventre (Aaniih) Tribes (the Tribes). This homeland in Montana is just a small portion of the Tribes’ ancestral homelands. Not long after the Reservation was established, the Federal Government filed a lawsuit to protect the Tribes’ right to water on its homelands. That lawsuit eventually reached the Supreme Court in 1908. The Supreme Court determined that the establishment of the Reservation included the senior right to water on the Reservation. Winters v. United States, 207 U.S. 564. In its opinion, the Court explained that the Reservation would be inadequate to fulfill the needs of the Tribes and the policy goals of the United States “without a change of conditions.” The Court also noted, [t]he lands were arid and, without irrigation, were practically valueless.” The Winters case has had far-reaching and long-lasting consequences for all of Indian country. It stands for the principle that the establishment of a reservation for a Tribe includes the reservation of waters necessary to make the reservation a livable homeland. The Winters doctrine protects Tribal rights and homelands, safeguarding the rights and interests of Tribes across the United States. Despite their legal victory in the Winters case, Tribes of the Fort Belknap Indian Reservation have not been able to fully put their reserved water rights to use. Today, the Reservation is comprised of approximately 605,338 acres, including lands held in Trust for the Tribes and allotments held in trust for individual Indians, situated mainly in the Milk River Basin in north central Montana. The Milk River forms the Reservation’s northern boundary. The southern boundary is from 25 to 35 miles south of the Milk River, extending on either side of the northern crest of the Little Rocky Mountains. The low rainfall on most of the Reservation severely limits what can be grown without irrigation. Not surprisingly, the major water use on the Reservation is the Fort Belknap Indian Irrigation Project (FBIIP). The BIA owns the FBIIP, which diverts water from the Milk River and two tributaries, Threemile Creek and White Bear Creek, and includes a 634 acre-feet (af) reservoir on Threemile Creek. The FBIIP serves 10,475 assessed acres, 92 percent of which are held in trust by the United States for the benefit of the Tribes or allottees. Groundwater wells on the Reservation are primarily used for domestic and municipal purposes and, to a lesser extent, stock watering. According to Bureau of Indian Affairs (BIA) and Tribal data, 3,351 Tribal members currently live on the Reservation. The total Tribal membership in August 2021, including members living off the Reservation, was 8,609. Most on-Reservation residents reside in three main towns: Fort Belknap Agency on the northern boundary of the Reservation, and Lodge Pole and Hays on the southern portion of the Reservation. The primary sources of employment on the Reservation are Tribal and Federal government services. The main industry is agriculture, consisting of cattle ranches, raising alfalfa hay for feed, and larger dryland farms. The unemployment rate on the Reservation is nearly 50%, according to a 2019 Montana State University study. b. Proposed Fort Belknap Indian Community Settlement Legislation In its role as Trustee, the United States filed water rights claims for Reservation lands in the Milk River and Missouri River basins in the ongoing statewide water rights adjudication. Since 1990, the Tribes, State, and United States have engaged in negotiations to resolve the Tribes’ and allotees’ water rights within the State. In 2001, the Montana legislature approved the Montana-Fort Belknap Indian Community Water Rights Compact (Compact). Congressional approval is necessary before the United States may join in the Compact. S. 1987 would authorize, ratify, and confirm the Compact to the extent it is consistent with S. 1987. This would resolve the Tribes’ water rights claims in Montana by recognizing the Tribal Water Right, which is defined by and established in the Compact. The Tribal Water Right entitles the Tribes to over 446,000 acre-feet per year (afy) of surface water, plus groundwater. Consistent with Federal law, S. 1987 protects the rights of allottees to use a portion of the Tribal Water Right for agricultural, domestic, and related uses on their allotments. In addition to the Tribal Water Rights provided by the Compact, S. 1987 includes a 20,000 afy allocation of storage from Lake Elwell, a Bureau of Reclamation (Reclamation) facility on the Marias River, also known as Tiber Reservoir. S. 1987 would also authorize funds to implement the provisions of the Compact and S. 1987. S. 1987 authorizes $1.17 billion in Federal appropriations for three general purposes: rehabilitation of the Fort Belknap Indian Irrigation Project; administration and development of the Tribes’ water rights; and mitigation for the impacts on water users outside the Reservation. S. 1987 is a mixed project- and fund-based settlement. S. 1987 includes two specific projects that the Department is charged with planning, designing, and constructing: (1) the rehabilitation, modernization, and expansion of the existing FBIIP; and (2) the rehabilitation and expansion of certain Milk River Project facilities to satisfy the Compact required mitigation negotiated by the Tribes and the State. S. 1987 authorizes the appropriation of up to $415.8 million for the rehabilitation, modernization, and expansion of the FBIIP. The Department supports rehabilitating and expanding the FBIIP to serve additional lands susceptible of sustained and economically viable irrigation. Without a feasibility level study, however, the costs of such a project cannot be reliably determined. The Tribes believe that the requested authorization will cover the costs. S. 1987 contains a provision providing that the Secretary’s obligations to rehabilitate, modernize, and expand the FBIIP will be deemed satisfied if despite diligent efforts, the project cannot be completed as contemplated due solely to the authorized appropriation being insufficient. S. 1987 identifies the Bureau of Indian Affairs (BIA) as the lead agency for the rehabilitation, modernization, and expansion of FBIIP, while providing the Tribes the opportunity to perform these activities through self-determination contracts. The identification of BIA as the lead agency for the rehabilitation, modernization, and expansion of FBIIP is unusual. Previously enacted Indian water rights settlements that have required the Secretary to plan, design, and construct major infrastructure have identified Reclamation as the lead agency for such purposes. Reclamation has the staffing and expertise and a demonstrated history of success in planning, designing, and constructing infrastructure. For these reasons and to ensure successful implementation of S. 1987, the Department suggests that Reclamation is better suited to lead the rehabilitation, modernization, and expansion of the FBIIP as well as the Milk River Project rehabilitation and expansion discussed below. S. 1987 authorizes the appropriation of up to $300 million to rehabilitate and expand certain Milk River Project facilities to implement the mitigation measures required by the Compact. S. 1987 identifies Reclamation as the lead agency to implement these mitigation projects. The Department testified in the 117th Congress about practical concerns regarding its ability to satisfy Compact provisions requiring mitigation of impacts on junior non-Indian and Milk River Project water users caused by the development of the Tribal Water Right. However, since the time of that testimony, Reclamation completed modeling that identifies viable alternatives to satisfy the Compact’s mitigation requirement. Based on Reclamation’s modeling, the Department determined that rehabilitation of the St. Mary Canal and the expansion of the Dodson South Canal will provide the 35,000 afy of mitigation required by the Compact. Again, without a feasibility level study, reliable costs of such a project cannot be determined. In an effort to avoid cost gap issues, S. 1987 provides that the Secretary’s obligations to complete Milk River Project mitigation projects will be deemed satisfied if despite diligent efforts, the projects cannot be completed as contemplated due solely to the authorized appropriations being insufficient. Because the St. Mary Canal is located on the Blackfeet Reservation, S. 1987 requires Reclamation to complete the canal’s rehabilitation in coordination with the Blackfeet Tribe. In addition to the project-based components described above, S. 1987 establishes a $454 million trust fund for the Tribes to be used for various purposes. Some of these purposes, such as the development of domestic water infrastructure and establishment of a Tribal water resources department to administer the Tribal Water Right, are commonplace in Indian water rights settlements. S. 1987 specifically would authorize the Tribes to use their trust fund to plan, design, and construct a pipeline to transport Lake Elwell water from an off-Reservation point of diversion on the Missouri River to the southern portion of the Reservation. The Department understands that the Tribes would be required to comply with all applicable Federal and State laws when implementing this and all other provisions in the settlement. Finally, S. 1987 transfers 10,322.58 acres of federal land and 3,519.3 acres of land currently owned by the Tribes into trust for the Tribes as part of the Reservation. In addition, S. 1987 directs the Secretary of the Interior and the Secretary of Agriculture to negotiate with the State to exchange certain State lands within the boundaries of the Reservation for federal lands elsewhere in the State. c. Conclusion The Department recognizes that the Tribes and State of Montana have worked hard to negotiate this settlement. The Department believes that this legislation is consistent with the Administration’s priorities of protecting Tribal homelands and meeting our trust responsibility. It would also bring meaning to the legal victory the Tribes and the United States secured more than a century ago in the Winters case. We support S. 1987, but note that the Department still needs to conduct additional analysis of this settlement agreement. We also note that we recommend some technical changes to aid in its implementation. Thank you again for the opportunity to appear before this Committee to provide the Department’s views on S. 1987. We look forward to continuing working with the Committee in support of Indian water rights settlements.