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Federal TERA Land Leasing Process (3-FD-h)

Tribes may enter into a Tribal Energy Resource Agreement (TERA) that must be approved by the Secretary of the Interior. 25 U.S.C. 3504 authorizes TERAs to permit tribes to enter into and manage leases, business agreements, and rights-of-way for the purpose of energy resource development on tribal land. Leases may not exceed a term of 30 years. Tribes who have entered into an approved TERA may lease tribal land without obtaining approval from the BIA. Regulations governing TERAs can be found at 25 CFR 224 et seq. This section delineates federal requirements for leases entered into under a TERA that trigger developer or tribal action during the leasing process.


TERA Land Leasing Process Process

3-FD-h.1 – Contact Tribal Representatives Identified in the TERA

25 CFR 224.63(d)(8) requires a TERA to identify the tribal representatives that are authorized to approve leases. The developer should contact the identified representatives as soon as a copy of the TERA is obtained.


3-FD-h.2 – Negotiate Land Lease Directly with Tribe

Once a TERA has been approved, the tribe negotiates directly with the developer. 25 U.S.C. 3504 and 25 CFR 224 et seq. govern some of the lease terms, while others are left up to the parties. Once the terms have been negotiated, the tribe issues the lease without BIA approval.


3-FD-h.3 – Obtain Information Regarding the Project, Economic Return and Developer Qualifications

25 CFR 224.63(d)(1) requires the TERA to contain mechanisms for obtaining “corporate, technical, and financial qualifications of a third party that has applied to enter into a lease…” 25 CFR 224.63(d)(4) requires the TERA to contain mechanisms for obtaining and analyzing information regarding the economic return to the tribe. 25 CFR 224.63(d)(5) requires the TERA to contain mechanisms for obtaining technical information about the project and mechanisms to ensure that activities are performed in compliance with the terms and conditions of the lease.

These mechanisms are used by the tribe to collect relevant information. The information must be preserved in accordance with 25 CFR 224.63(l) in order to facilitate the Secretary’s periodic review, along with other information related to the lease and the performance of the tribe’s activities assumed under the TERA.


3-FD-h.4 – Conduct Environmental Review

25 U.S.C. 3504(e)(2)(C) requires a TERA to establish a tribal environmental review process for the issuance of leases. The Secretary of the Interior may provide financial assistance to the tribe to facilitate the environmental review. The TERA environmental review process may be patterned after the National Environmental Policy Act (NEPA) review process, although it need only meet the minimum requirements found in 25 U.S.C. 3504. In addition, the TERA must include provisions that ensure compliance with the review process.

The process must include, at a minimum:

  • Identification and evaluation of significant environmental effects;
  • Identification of proposed mitigation measures, if any, and incorporation of mitigation measures into the lease;
  • A public comment process and a tribal response to substantive comments before the lease is approved;
  • Sufficient administrative support and technical capability to carry out the environmental review process; and
  • Tribal oversight of other parties to the lease to ensure compliance with the TERA and applicable federal environmental laws.


3-FD-h.5 – Consult with States Affected by Off-Reservation Environmental Impacts

25 U.S.C. 3504(e)(2)(B)(iii)(X) requires the tribe establish a consultation process with any state that is affected by off-reservation environmental and cultural impacts identified pursuant to the environmental review process.


3-FD-h.6 – Solar Land-Use Lease

As stated above, leases will be negotiated directly with the tribe without the need for BIA approval. However, 25 CFR 224.63(d) requires a TERA to contain certain provisions with respect to leases, some of which may affect the lease terms:

  • Mechanisms for obtaining corporate, technical, and financial qualifications of a third party that has applied to enter into a lease, business agreement, or right-of-way;
  • Express limitations on duration that meet the restrictions of 25 U.S.C. 3504(e)(2)(C) 25 CFR §224.86 (the lease may not exceed 30 year unless the tribe authorizes a renewal and the TERA is still in effect);
  • Mechanisms for amendment, transfer, and renewal;
  • Mechanisms for obtaining, reporting, and evaluating the economic return to the tribe;
  • Mechanisms for securing technical information about activities and ensuring that technical activities are performed in compliance with terms and conditions;
  • Assurances of the tribe's compliance with all applicable environmental laws;
  • Requirements that the lessee, operator, or right-of-way grantee will comply with all applicable environmental laws;
  • Identification of tribal representatives with the authority to approve a lease, business agreement, or right-of-way and the related energy development activities that would occur under a lease, business agreement, or right-of-way;
  • Public notification that a lease, business agreement, or right-of-way has received final tribal approval;
  • A process for consultation with affected States regarding off-reservation impacts, if any, identified under paragraph (c) of this section;
  • A description of remedies for breach;
  • A statement that any provision that violates an express term or requirement of the TERA is null and void;
  • A statement that if the Secretary determines that any provision that violates an express term or requirement of the TERA is material, the Secretary may suspend or rescind the lease, business agreement, or right-of-way, or take any action the Secretary determines to be in the best interest of the tribe, including, with the consent of the parties, revising the nonconforming provisions so that they conform to the intent of the applicable portion of the TERA; and
  • A statement that the lease, business agreement, or right-of-way subject to a TERA, unless otherwise provided, goes into effect when the tribe delivers executed copies of the lease, business agreement, or right-of-way to the Director of the BIA by first class mail return receipt requested or express delivery. The parties to a lease, business agreement, or right-of-way may agree in writing that any provision of their contract may have retroactive application.

Some of these requirements may need to be incorporated into the lease terms, while others may be performed prior to the negotiation of the lease. Parties should refer to the applicable TERA to determine how these requirements will be implemented.


3-FD-h.7 – Send Copy of the Lease to the BIA

25 CFR 224.83(b) requires the tribe to send a copy of the executed lease to the BIA within one day of execution. The copy must be sent by certified mail with a return receipt requested or by overnight delivery.


3-FD-h.8 – Inform Public of Lease Approval

25 CFR 224.83(a) requires the tribe to inform the public of the approval of the lease under the TERA. For specific notification procedures, developers should refer to the applicable TERA.


3-FD-h.9 – Submit Information and Documentation of Payments to the BIA

25 CFR 224.63(k) requires the tribe submit information and documentation of payments made directly to the tribe, if any. Required documentation must include proof of payment.






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