May 12, 1998 
Testimony of Senator Joseph Lieberman on Indian Affairs 

Thank you Mr. Chairman. Let me start by thanking you, both for inviting me to testify before the Committee today and for your willingness to examine this extraordinarily important and difficult issue. As you may know, I have been concerned for a long time about the way our trust acquisition laws are being implemented, because of the impact those laws have had in my home State of Connecticut.
Original Purpose of Land-In-Trust Process

I’d like share with you what has happened in Connecticut, but before I turn to that, let me emphasize from the outset that I strongly believe that trust acquisitions, as originally conceived and authorized by Congress in the Indian Reorganization Act of 1934, still play an important, vital and valid role in federal Indian policy. As you know, when Congress passed the 1934 Act, the landholdings of some tribes had dwindled down to acres. Tribes and their members were selling and losing land to foreclosures, tax arrearages, and the like. Without land, many tribes had neither the means to maintain their culture nor the ability to earn a living. In response, Congress gave the Secretary of Interior the authority to take land into trust for tribes -- that is to say, to take title to land on behalf of tribes to ensure that those lands would not be sold or otherwise lost.

Impact of Taking Land Into Trust

Since 1934, the land-in-trust process has been of great benefit to many tribes. But it has is not without its costs to others. Once the United States takes land into trust for a tribe, the land is largely removed from State and local control. State and local governments no longer have broad jurisdiction over the land, and it is removed from those governments’ tax, zoning and police powers unless specifically provided, or agreed, otherwise.

In the vast majority of cases in which the Secretary has taken land into trust, those are costs I believe are worth bearing, because the societal benefit of fulfilling our obligation to help Indian tribes maintain their culture and achieve economic self-sufficiency outweighs the significant impact the acquisition may have on the communities from whose control the land is taken.

Connecticut Experience

But as our experience in Connecticut shows, that is not always the case. In a few, but significant, instances, the trust acquisition process may be being used for purposes that bear little, if any, resemblance to what Congress had in mind when it passed the 1934 Act. This is largely due to the Indian Gaming Regulatory Act of 1988, or “IGRA,” which has spurred a significant growth in Indian gaming.

Most tribes have not become wealthy from gaming, but some have, particularly in my home State. One of the most successful casinos in the country is located in southeastern Connecticut and is owned and operated by the Mashantucket Pequot Tribe. Annual casino revenues for the Tribe reportedly approach $1 billion. I don’t begrudge the Tribe success. It has been in many ways a very good and generous neighbor and has brought much needed jobs and economic development to these communities.

Given the Tribe’s tremendous financial success, it is not at all surprising that it has decided to buy land near its reservation in order to expand and diversify its businesses. According to press accounts, the Tribe owns over 3,500 acres outside of the boundaries of its reservation, in addition to the approximately 1,320 acres that is held in trust on its behalf within the reservation. The Tribe is now the largest private landowner in southeastern Connecticut, and tribal leaders have at various times talked of building a theme park and golf courses on the Tribe’s off-reservation land.

The Tribe should be free to develop this off-reservation land as any other property owner might. But unlike other property owners -- who must develop their land in compliance with State and local zoning laws and other regulations and who must pay taxes on the land and on the businesses conducted on the land -- the Tribe has exercised their option, under the 1934 Act, to ask the Department of Interior to take that land into trust on the Tribe’s behalf.

Since 1992, the Department of Interior has granted two applications from the Tribe to take into trust land located outside the Tribe’s reservation boundaries in the neighboring towns of Ledyard, North Stonington and Preston. The affected towns and the Connecticut attorney general have challenged one of those acquisitions in federal court, where the case is still pending. A third request to take off-reservation land into trust was sent back to the Tribe because of legal deficiencies in the application, but reapplication by the Tribe is expected, and past statements by Tribal leaders suggest that more applications may be filed in the future.

The effect of the Tribe’s and the Department of Interior’s decisions involving off-reservation lands has been unsettling, to say the least, on the Tribe’s neighbors -- the residents of the small towns that border the reservation. Many of those residents are afraid that if the tribe is able to continue taking off-reservation land off the local tax rolls and immunize it from local zoning control, they will not have any control over the future of their towns.

And, I must say, I cannot assure them that their fears are unfounded. Ledyard, North Stonington and Preston are small communities whose combined population is about 25,000 -- less than half the number of visitors the casino receives on a good day. The Towns have a combined annual tax revenue of approximately $25 million -- less than one-third the amount of revenue the casino generates in one month alone. Obviously, towns of this size cannot absorb a business of this size without there being consequences. As a result of the casino’s success, the character of the towns has been permanently altered, and the costs of local government -- from crime prevention to road maintenance to countless other things -- have increased.

Let me again emphasize that the casino has also brought much good with it -- most importantly jobs and economic development for a region that had lost many defense-related positions in recent years. But given the financial resources of the Tribe and the apparent willingness of the Department of Interior to take land into trust on their behalf regardless of any evidence that the Tribe needs additional trust lands, many residents wonder where this will lead. I too question the policy justification for the United States to change the boundaries of three Connecticut towns unilaterally so that a wealthy tribe can expand its gaming or other business enterprises, free of taxes and local land-use controls.

Although Connecticut may have been one of the first States to deal with this issue, we will not be the last one. I understand a similar situation is going on in Minnesota, where a very wealthy tribe is seeking to take a significant amount of off-reservation land into trust so that it can build a shopping center and light industrial park. I have no doubt that as more tribes become wealthy through gaming, they too will seek to expand their businesses through this process.

It is time, I believe, for us in Congress to reevaluate this process, to make sure that trust acquisitions are made only for the worthwhile purposes Congress originally intended.

Suggestions for Reforming the Process

I have proposed one way of addressing this problem. My Indian Trust Lands Reform Act (S. 1329) would amend the Indian Reorganization Act to prohibit the Secretary of Interior from taking any lands located outside an Indian reservation into trust on behalf of an economically self-sufficient Indian tribe, if those lands are to be used for gaming or any other commercial purpose, rather than for noncommercial purposes such as for tribal housing, government or education. My proposal directs the Secretary of Interior to determine whether a tribe is economically self-sufficient and to set by regulation the criteria he will use in making the self-sufficiency determination.

Put simply, my bill would ensure that tribes needing land to obtain economic self-sufficiency can still do so. It would not affect the ability of any tribe to take land into trust within its reservation’s boundaries or even outside its reservation’s boundaries if the land is to be used for non-commercial purposes, like tribal housing or the reclamation of ancestral burial grounds. The only thing my bill would do is require tribes who are economically self-sufficient and who wish to engage in commercial activity outside of their reservation’s boundaries to do so in compliance with the same local land-use and tax laws applied to every other land holder.

Let me emphasize that although I firmly believe something must be done about the land-in-trust process, I am not wed to the details of my particular proposal and would welcome the opportunity to work with the members of the Committee to address this problem.

I know Senator Campbell, for example, has a proposal. As I said at the beginning, I truly appreciate your willingness to take a fresh look at this issue. I have several concerns about your bill that I would like to share with you.

First, I have noted that your bill does not affect the 1934 Act, but only IGRA’s provision on taking land into trust for gaming purposes. As the Connecticut and Minnesota experiences show, effectively addressing this issue requires looking beyond IGRA’s land-in-trust provision. As gaming makes a small number of tribes wealthy, some of those tribes are diversifying their businesses and seeking to acquire land for non-gaming purposes. Although a shopping center or golf course may not bring with them all of the problems associated with gaming, they still can change the character of a community, and taking land into trust for those purposes still removes precious acreage from a community’s tax rolls and deprives it of control over the community’s future development and growth. Any review of the land-in-trust process that is limited to IGRA is destined to provide an incomplete solution to this problem.

Second, although I believe that your proposal to require States’ consent to taking land in trust for gambling is a very positive step forward, in one sense, it is also a step backward, because it removes from the current provision any direct and specified role for the local communities most affected by the potential trust acquisition. As you know, IGRA currently requires the Department of Interior to consider the local impact of a trust acquisition. By deleting that requirement and instead just requiring a State-Tribal agreement or compact, your bill would leave it up to the State government alone to decide whether to allow local communities a role in trust decisions. Although I would like to presume that State governments always fairly represent the interests of their localities, it is not hard to imagine a situation where a State could in the aggregate benefit from gaming -- by, for example, getting tribal agreement to pay the State hundreds of millions of dollars annually -- while the localities in which the gaming occurred would be detrimentally impacted.

Finally, as I already have noted, I would add to your proposal Congressional recognition that the trust acquisition process must apply differently to wealthy tribes and tribes that are not wealthy. Again, I firmly believe that the land-in-trust process should remain available to achieve its original goals of helping tribes obtain land on which to live as a community and gain economic self-sufficiency. It should not, however, be used to help any wealthy land owner -- Native American or otherwise -- to take off-reservation land out of the control of the rest of the community simply to serve its own commercial interests.

In closing, Mr. Chairman, let me once again thank you not only for the opportunity to testify on an issue that is truly of great importance to me, but also for your willingness to seriously examine this very difficult issue. As you move forward with your legislation, I would welcome the opportunity to work with you and your staff on this issue.