January 18, 2023
- Marsha Cotton, Attorney Commercial Litigation Group, Snell and Wilmer
- Heidi McNeil Staudenmaier, Partner Coordinator of Native American Law & Gaming Law Services, Snell and Wilmer
The impact of historic land acquisition on tribal gaming in Alaska
A 2022 opinion from the Department of the Interior could have a profound effect on the ability of Alaskan tribes to open tribal casinos. Marsha Cotton and Heidi McNeil Staudenmaier report
The history of gaming in the United States is complex, particularly in the State of Alaska. Until recently, certain Alaskan Native Tribes have struggled to participate in the profitable Class II and III tribal gaming industry. In large part, unclear legislation concerning the United States government’s ability to hold “Indian Lands” in trust on behalf of Alaskan Native Tribes – a precondition for many tribes seeking to offer gaming on their lands under the Federal Indian Gaming Regulatory Act (“IGRA”) – has proved to be a roadblock. This article outlines the turbulent history of the land into trust acquisition process in Alaska, and how recent developments may finally provide Alaskan Native Tribes the opportunity to expand gaming on their lands.
Land into trust background
First, it is helpful to understand the Native American land into trust process as distinct from traditional property ownership principles. Most commonly, individuals and entities hold title to land as “fee land.” Fee land is under complete control of the owner/titleholder, who can be an individual or an entity, and allows the owner to use the land for any legal purpose. In contrast, “trust” land is a territorial arrangement, whereby one party agrees to hold title to the property for the benefit of another party. Specific to Native American lands, the land into trust process involves the United States Department of the Interior (“DOI”) acquiring the title to a land parcel and then holding that parcel “in trust” for the benefit of the tribe or an individual tribal member.
The land into trust process was generally created in response to the devastating effects of the Dawes Act, also known as the General Allotment Act (“GAA”). Passed in 1887, the GAA divided tribal lands, allotted parcels to individual tribal members, and provided for the public sale of any surplus tribal lands remaining after allotment. This led to many negative and harmful consequences, including the dramatic reduction of land ownership by Native American tribes in both the lower 48 states and Alaska.
In 1934, Congress enacted the Indian Reorganization Act (“IRA”), which for practical purposes, terminated the allotment system. Years later, in 1980, the DOI established regulations governing the land to trust process in an effort to help tribes regain lost lands and promote tribal self-determination. Through the DOI trust process, tribes have the ability to establish a land base for tribal communities, reacquire lands within or near their reservations, and clarify jurisdiction over their lands. Acquiring land into trust also helps to maximize a tribe’s eligibility for federal services and programs, including opportunities for gaming. Most tribal lands in the United States are currently held as trust lands.
Alaska legislative and administrative history
On November 16, 2022, the DOI Solicitor issued Opinion M-37076 (“2022 Opinion”), clarifying that the DOI Secretary does in fact have authority to acquire land into trust within the State of Alaska. The next day, the DOI Assistant Secretary for Indian Affairs announced the approval of a land into trust acquisition for the Central Council of Tlingit and Haida Indian Tribes of Alaska. The acquisition on behalf of the Tlingit and Haida Tribes is only the second land into trust acquisition in Alaska since the passage of the 1971 Alaska Native Claims Settlement Act (“ANCSA”), and the first acquisition in five years.
The acquisition is significant because the DOI had historically maintained that it lacked authority to acquire trust lands in Alaska, based on the ANCSA and a hodgepodge of federal statutes including the IRA and Alaska Indian Reorganization Act (“Alaska IRA”). It was not until recently that the DOI changed its course. To understand how this change will likely impact tribal gaming in Alaska, the convoluted history of the IRA and Alaska IRA are briefly discussed below.
Congress enacted the IRA in 1934, in part, to establish an opportunity for tribes to assume a greater degree of self-government, both politically and economically, by allowing conservation and development of Indian Lands through the land into trust process. Section 5 of the IRA generally authorizes the DOI Secretary to acquire land into trust across the United States. However, confusion over the Secretary’s ability to acquire land into trust specifically within Alaska has plagued interpretation of the IRA from the beginning.
Originally, Section 5 of the IRA authorized the Secretary to acquire land into trust for “Indians” and provided that, for the purposes of the IRA, Eskimos and other aboriginal people of Alaska are considered “Indians.” At the same time, however, the IRA was explicitly inapplicable to any U.S. Territory, which at the time included Alaska.
Two years later, in 1936, Congress enacted the Alaska IRA to correct these perceived inconsistencies within the IRA. The Alaska IRA extended the trust authority codified in IRA Section 5 to the Territory of Alaska. However, once Alaska became an official state in 1959, uncertainty arose again over the applicability of both the IRA and Alaska IRA to the State of Alaska (as opposed to the Territory of Alaska), and the DOI took the position that it lacked authority to acquire trust lands in Alaska. Because of this, almost none of the 229 federally recognized tribes in Alaska have ever held “trust-status” land.
After decades of uncertainty, in January 2017, then-Solicitor for the DOI Hilary C. Tompkins published an Opinion (“2017 Opinion”) which concluded that Section 5 of IRA, as applied to Alaska through the Alaska IRA, authorized the Secretary to accept land into trust for Alaskan Native Tribes and individuals. This clarification was short-lived because, in June 2018, her successor as DOI Solicitor Daniel H. Jorjani temporarily withdrew the 2017 Opinion while he investigated the Secretary’s authority for future trust acquisitions in Alaska.
On January 19, 2021, one day before President Joe Biden’s inauguration, then-Solicitor Jorjani permanently withdrew the 2017 Opinion and published a new Opinion (“2021 Opinion”), addressing the Secretary’s authority to acquire land into trust in Alaska. The 2021 Opinion asserted the 2017 Opinion’s legal conclusion that the Secretary is authorized to take land into trust in Alaska was flawed because it did not address the possible effect of the Statehood Act and the ANCSA upon the Secretary’s authority. For almost two years it appeared that the DOI would maintain this position precluding land into trust acquisitions in Alaska.
The recent 2022 Opinion serves as a withdrawal of the 2021 Opinion. The 2022 Opinion concluded that Alaska’s statehood did not alter the applicability of the IRA to Alaska Natives and tribes. The 2022 Opinion further concluded that none of the concerns raised in the 2021 Opinion, mainly the issue of ANCSA applicability, affects the scope of the Secretary’s authority to acquire land into trust under the IRA and Alaska IRA.
Impact On tribal gaming
Due to the complicated history of Alaska and the land into trust process, gaming in Alaska has been very limited since the passage of the IGRA, in contrast to the lower 48 states. The IGRA serves as the comprehensive regulatory scheme for tribal gaming throughout the United States, and it provides that a tribe may only conduct gaming on “Indian Lands.” The IGRA defines “Indian Lands” to include, among other things, any lands outside a reservation which are held in “trust” for the tribe—which (until recently) Alaska tribes have virtually none.
The 2022 Opinion appears to have encouraged a significant shift for Alaskan tribes to move forward with developing gaming operations. For example, on December 8, 2022, the Chairman of the National Indian Gaming Commission (“NIGC”) approved the Klawock Cooperative Association’s Class III Gaming Ordinance amendment as required by the NIGC’s Revised Model Gaming Ordinance. As a result, Klawock Cooperative Association can now expand its existing Class II gaming operations.
Though the 2022 Opinion is being touted as a sign of great progress for Alaskan tribes in the gaming industry, it is important to note that the Opinion is vulnerable to withdrawal just as the 2017 and 2021 Opinions. Recognizing this, the DOI wants to make the trust process clarification provided by the 2022 Opinion less likely to be reversed. On December 5, 2022, the DOI Office of the Assistant Secretary for Indian Affairs published proposed amendments to the regulations governing the land into trust process (25 CFR part 151).
One major change included in these proposed regulations is to create a new category within the trust acquisition process for “initial Indian acquisitions.” This is designed to fast track the process for tribes applying for trust lands for the first time. Such a change is particularly relevant for lands in Alaska, where many of the federally recognized tribes have been precluded from reaping the benefits of lands held “in trust”.
Another major proposed regulation change is the removal of language that carved out Alaskan Natives from the definition of “Individual Indian.” The purpose of this change is to clarify that the regulations do not limit trust acquisition by Alaska Natives and tribes in any way. The DOI has invited representatives of federally recognized Indian Tribes and Alaska Native Corporations to consult on these proposed changes to the land into trust process. Written comments on the proposed rule changes will be accepted until March 1, 2023, and the proposed regulations will be finalized thereafter. If and when the proposed amendments are approved, Alaskan Native Tribes should have an easier path to establishing gaming facilities on their lands.
Since the passage of the IGRA, tribal casinos have thrived on Indian Lands throughout the United States. However, Alaskan Native Tribes have, for the most part, historically been excluded from capitalizing on the gaming industry’s success. Now, with the DOI’s 2022 Opinion in hand, Alaskan Native Tribes may move forward to seek the development and expansion of gaming activities on their lands. Although the final administrative rules for trust acquisitions remain undetermined, at least for the foreseeable future, Alaskan Native Americans are celebrating the opportunity to use the land into trust acquisition process to greatly enhance their economic development opportunities through gaming ventures.