Proposed Rule: Indian trust management reform

8/14/2019 Proposed Rule: Indian trust management reform

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Tuesday,

August 8, 2006

Part IV

Department of theInteriorBureau of Indian Affairs

25 CFR Parts 15, 18, 150, et al.

43 CFR Parts 4 and 30

Indian Trust Management Reform;Proposed Rule

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45174 Federal Register / Vol. 71, No. 152/ Tuesday, August 8, 2006/ Proposed Rules

DEPARTMENT OF THE INTERIOR

Bureau of Indian Affairs

25 CFR Parts 15, 18, 150, 152, and 179

Office of the Secretary

43 CFR Parts 4 and 30

RIN 1076AE59

Indian Trust Management Reform

AGENCY: Bureau of Indian Affairs, Officeof the Secretary, Interior.

ACTION: Proposed rule.

SUMMARY: The Bureau of Indian Affairs(BIA) and the Office of the Secretarypropose to amend several of theirregulations related to Indian trustmanagement to further fulfill theSecretarys fiduciary responsibilities to

federally recognized tribes andindividual Indians and to meet theIndian trust management policiesarticulated by Congress in the IndianLand Consolidation Act (ILCA), asamended by the American IndianProbate Reform Act of 2004 (AIPRA).These amendments address Indian trustmanagement issues in the areas ofprobate, probate hearings and appeals,tribal probate codes, life estates andfuture interests in Indian land, theIndian land title of record; andconveyances of trust or restricted land.There is also an Application for

Consolidation by Sale form that isassociated with one of theseamendments.

DATES: Please submit your comments byOctober 10, 2006.

ADDRESSES: You may submit comments,identified by the number 1076AE59, byany of the following methods:Federal rulemaking portal: http://

www.regulations.gov.Follow theinstructions for submitting comments.

Web site at http://www.doitrustregs.com.

E-mail:[email protected].

Include the number 1076AE59 in thesubject line of the message.

Fax: (202) 2085320. Include thenumber 1076AE59 in the subject lineof the message.

Mail: U.S. Department of the Interior,1849 C Street, NW., Mail Stop 4141,Washington, DC 20240

Hand delivery: Michele Singer, U.S.Department of the Interior, 1849 CStreet, NW., Washington, DC 20240.Comments on the information

collection burdens, including commentson or requests for copies of theApplication for Consolidation by Sale

form, are separate from those on thesubstance of the rule. Send commentson the information collection burdensto: Interior Desk Officer 1076AE59,Office of Management and Budget, e-mail:[email protected]; or 202/3956566 (fax). Please also send a copy ofyour comments to BIA at the locationspecified under the heading ADDRESSES.FOR FURTHER INFORMATION CONTACT:Michele Singer, Counselor to theAssistant SecretaryIndian Affairs,Department of the Interior, Bureau ofIndian Affairs, 1849 C Street NW., MailStop 4141, Washington, DC 20240,telephone (202) 2734680.SUPPLEMENTARY INFORMATION:

I. Statutory AuthorityII. Background

A. History of the Rule

B. The Need for this Proposed RulemakingC. Development of Proposed Reguatory

LanguageD. Status of Other Indian Trust

Management Reform RegulationsIII. Overview of Proposed RuleIV. Part-by-Part Analysis

A. 25 CFR Part 15B. 25 CFR Part 18C. 25 CFR Part 150

D. 25 CFR Part 152E. 25 CFR Part 179F. 43 CFR Part 4G. 43 CFR Part 30

V. Public CommentsA. Comments Received Prior to This

PublicationB. Directions for Submitting Comments

VI. Procedural RequirementsA. Regulatory Planning and Review

(Executive Order 12866)B. Regulatory Flexibility ActC. Small Business Regulatory Enforcement

and Fairness ActD. Unfunded Mandates Reform Act of 1995E. Governmental Actions and Interference

with Constitutionally Protected PropertyRights (Executive Order 12630)

F. Federalism (Executive Order 13132)G. Civil Justice Reform (Executive Order

12988)H. Paperwork Reduction ActI. National Environmental Policy Act

(NEPA)J. Government-to-Government

Relationships with Tribes (ExecutiveOrder 13175)

K. Energy Effects (Executive Order 13211)

I. Statutory Authority

Regulatory amendments to these parts areproposed under the general authority of theTrust Fund Management Reform Act of 1994,25 U.S.C. 4021 et seq., and the Indian Land

Consolidation Act of 2000 (ILCA) asamended by the American Indian ProbateReform Act of 2004 (AIPRA), 25 U.S.C. 2201et seq. The following table providesadditional statutory authority specific to eachCFR part.

25 CFR part 15 ............................... 5 U.S.C. 301; 25 U.S.C. 2, 9, 37274, 410; 44 U.S.C. 3101 et seq.25 CFR part 18 ...............................NEW-Tribal Probate Codes ............

5 U.S.C. 301; 25 U.S.C. 2, 9, 37274, 410; 44 U.S.C. 3101 et seq.; Pub. L. 108374 (American IndianProbate Reform Act of 2004).

25 CFR part 150 ............................. Act of June 30, 1834 (4 Stat. 738; 25 U.S.C. 9). Act of July 26, 1892 (27 Stat. 272; 25 U.S.C. 5). Reorga-nization Plan No. 3 of 1950 approved June 20, 1949 (64 Stat. 1262). (Act of April 26, 1906 (34 Stat.137); Act of May 27, 1908 (35 Stat. 312); Act of August 1, 1914 (38 Stat. 582, 598) deals specificallywith land records of the Five Civilized Tribes. Act of February 14, 1920 (41 Stat. 415) amendedMarch 1, 1933 (47 Stat. 1417; 25 U.S.C. 413); 5 U.S.C. 552a; and 31 U.S.C. 9701.

25 CFR part 152 ............................. R.S. 161; 5 U.S.C. 301. Interpret or apply sec. 7, 32 Stat. 275, 34 Stat. 1018, sec. 1, 35 Stat. 444, sec. 1and 2, 36 Stat. 855, as amended, 856, as amended, sec. 17, 39 Stat. 127, 40 Stat. 579, 62 Stat. 236,sec. 2, 40 Stat. 606, 68 Stat. 358, 69 Stat. 666: 25 U.S.C. 378, 379, 405, 404, 372, 373, 483, 355, un-less otherwise noted.

25 CFR part 179 ............................. 86 Stat. 530; 86 Stat. 744; 94 Stat. 537; 96 Stat. 2515; 25 U.S.C. 2, 9, 372, 373, 487, 607, and 220111;Pub. L. 108374 (American Indian Probate Reform Act of 2004).

43 CFR part 4 ................................. 5 U.S.C. 301; 43 U.S.C. 1201.43 CFR part 30 ...............................NEWProbate Hearing Proce-

dures.

5 U.S.C. 301; 43 U.S.C. 1201.

http://www.regulations.gov/http://www.regulations.gov/http://www.doitrustregs.com/http://www.doitrustregs.com/mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]://www.doitrustregs.com/http://www.doitrustregs.com/http://www.regulations.gov/http://www.regulations.gov/


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45175Federal Register / Vol. 71, No. 152/ Tuesday, August 8, 2006/ Proposed Rules

II. Background

This rulemaking is a result of acollaborative, multi-year undertaking toidentify a comprehensive strategy forimproving Indian trust management.The Department of the Interior managesIndian trust assets in accordance withits fiduciary trust relationship with

tribes and individual Indians. The termtribes is used in this preamble to referto Federally recognized tribes. Thepurpose of todays proposed rulemakingis to allow the Department of theInterior to better meet its fiduciary trustresponsibilities and to carry out thepolicies established by Congress tostrengthen tribal sovereignty. Thisrulemaking will provide the Departmentwith the tools to more effectively andconsistently manage trust assets and

better serve its trust beneficiaries (i.e.,Indian tribes and individual Indians).

A. History of the Rule

The Department of the Interior hasbeen examining ways to better meet itsfiduciary trust responsibilities since1994, when Congress passed the TrustFund Management Reform Act.Throughout this time, the Departmenthas sought the participation and inputof tribal leaders and individual Indian

beneficiaries to identify ways in whichthe Department can better serve its

beneficiaries.In July 2001, the Secretary of the

Interior (Secretary) issued SecretarialOrders 3231 and 3232. These orderscreated the Office of Historical Trust

Accounting (OHTA) to performhistorical accounting of trust assets andcreated a temporary Office of the IndianTrust Transition (OITT), which wascharged with reorganizing the agency to

better meet beneficiaries needs. TheseSecretarial Orders also stated theSecretarys policy to take a morecoordinated approach to ensure theoverall success of trust reform.

In accordance with this policy, theDepartment reevaluated its approach totrust reform and, in January 2002,embarked on an examination andreengineering of its Indian trust

management processes. This effortdiffered from prior trust reform effortsbecause it took a comprehensiveapproach to trust reform, linkingindividual trust reform issues to anoverall strategy. To ensure that thestrategy fully considered tribalconcerns, the Department assembled a

Joint Task Force of tribal representativesand representatives from theDepartment.

From members of this Joint TaskForce, a subcommittee of both tribalrepresentatives and Department

representatives was formed. Thesubcommittee met regularly to reviewthe As-Is processes of the way majortrust functions were performed at thattime. From this As-Is model, thesubcommittee identified business goalsand objectives the Department shouldmeet in fulfilling its trustresponsibilities and providing improved

services to trust beneficiaries. It thendeveloped the overall strategy to meetthose goals and objectives, documentedas the Comprehensive TrustManagement (CTM) plan.

The CTM laid the groundwork fortrust reform by providing strategicdirection for development of the To-Be model, known as the FiduciaryTrust Model (FTM). The FTM redesignstrust processes into more efficient,consistent, integrated, and fiscallyresponsible business processes. Indeveloping the FTM, the teamincorporated years of Departmental

consultation with tribes. TheDepartment adopted the FTM inDecember 2004 to guide trust reform.Together with Indian affairs policies,the FTM forms the basis of todaysrulemaking.

B. The Need for This ProposedRulemaking

Since adopting the FTM, theDepartment has formed an FTMImplementation Team with tribalrepresentatives. The FTMImplementation Team is leadinginternal organizational changes forimproving performance and

accountability in management of thetrust. At the beginning of thereengineering process, the Joint TaskForce had anticipated that regulatorychanges would be necessary to fullyimplement trust reform. The Team hassince determined, and the Secretary hasconfirmed, that certain regulatorychanges are indeed needed to enable theDepartment to fully implement theFTM. Todays proposed rule includesmany of these necessary regulatorychanges.

Additionally, Congress enacted theAmerican Indian Probate Reform Act of

2004. AIPRA amends ILCA to bettermeet the trust reform goals for landconsolidation articulated in ILCA.Regulatory changes authorized byAIPRA are included in this proposedrule.

C. Development of Proposed RegulatoryLanguage

This proposed rulemakingencompasses tribal and Departmentalrepresentatives efforts on the Joint TaskForce, as well as the efforts of tribalrepresentatives who have provided

comments throughout the trust reformprocess. These efforts guided in-houseteams in drafting the specific regulatorylanguage included in this proposedrulemaking. The in-house teamsconsisted of Federal personnel fromDepartment headquarters and the field,and included program officers andDepartment attorneys possessing

extensive expertise in probate, landtitles and records, acquisition andconveyance, leasing and grazing, andadministrative appeals. On December27, 2005, the Department sharedadvance copies of the proposedregulatory language (identified aspreliminary drafts throughout thispreamble) with leaders of eachFederally recognized tribal government,as well as additional contacts in Indiancountry, for their input andrecommendations. The Department hasalso presented the preliminary draftsand obtained the input of tribes at two

formal consultation meetings: one inAlbuquerque, New Mexico on February1415, 2006, and one in Portland,Oregon on March 29, 2006. Commentsreceived during these consultations andin the time leading up to thispublication have identified severalissues that the Department consideredin revising the preliminary drafts forpublication as a proposed rule. Inaccordance with the government-to-government relationship with tribes,formal consultations are also beingscheduled to take place during thecomment period that follows this

publication in the Federal Register tofacilitate an informed final rule. SeeSection IV, Public Comments, for detailson upcoming consultations.

D. Status of Other Indian TrustManagement Reform Regulations

The Department is also developingregulatory amendments to landacquisitions (25 CFR part 151), leasing(25 CFR part 162), and grazing (25 CFRpart 166), and developing draftregulatory language addressing trustfund accounting and appeals (new CFRpart), unclaimed moneys/whereabouts

unknown (new CFR part), and fees forservice (new CFR part). Based on inputreceived during the February 1415,2006, Albuquerque tribal consultationsession, the Department has determinedthat these regulations require additionalwork before publication as a proposedrule. The Department plans topromulgate these additional regulationsat some point in the future. Together,these regulatory changes will providethe Department with the tools it needsto better serve beneficiaries and willstandardize procedures for consistent



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execution of fiduciary responsibilitiesacross BIA Regions.

III. Overview of Proposed Rule

The proposed rule amends variousparts of the CFR to further implementIndian trust management reform andmeet the policies expressed by Congressin ILCA, as amended by AIPRA.

Together, these amendments form anintegrated approach to Indian trustmanagement related to probate, landrecords and title documents, andconveyances that allow the Departmentto better meet the needs of its

beneficiaries.The Department has revised many of

these regulations, in accordance withthe Plain Language Initiative (63 FR31885 (June 10, 1998)) to facilitate easeof use and public comprehension.

In addition to making plain languagerevisions, amendments revise theregulations to:

Incorporate AIPRA changes to

probate: AIPRA created a uniformprobate code to standardize intestatesuccession rules for trust and restrictedproperty. The uniform probate codereinforces tribal sovereignty byeliminating the application of state lawsin the probate of trust and restrictedassets while deferring to approved tribalprobate codes. AIPRA also establishednew mechanisms for consolidatingfractionated interests at probate andthrough sale of highly fractionatedtracts. The proposed amendments toprobate regulations would implementAIPRAs provisions by requiring the

additional information needed todetermine heirs and devisees to beincluded in the probate file, and byestablishing the procedures fordirectional disclaimers, purchases atprobate and consolidation agreements.These regulations continue to refer allprobate cases to OHA. The amendmentsstreamline the OHA process byshortening deadlines to more reasonabletime periods. Amendments to life estateprovisions reflect AIPRAs change in thevaluation of a life estate to be withoutregard to waste and base the valuationon the four-year average Single Life

Factor used by the U.S. InternalRevenue Service in Table S of the 7520rate schedule, without regard to gender.

Promote consolidation (reducefractionation) of interests: Allotmentsowned by Indians have becomeincreasingly fractionated with theprobate of each generation, resulting inthe division of the allotment intosmaller and smaller interests. Theseamendments meet the policy expressed

by Congress to reduce fractionation (i.e.,the exponential increase in the numberof ownership interests in a given parcel

of land) of tribal and individual Indianinterests in trust and restricted propertythrough the use of several tools. Thesetools include the opportunities for tribesto establish a tribal land consolidationplan; purchase interests in land withintheir respective jurisdictions whenoffered for negotiated sale, gift, orexchange; make a tribal tract purchase

(i.e., obtain fractionated interests of non-consenting trust and restricted ownersunder certain circumstances); and unifyownership and consolidate interests ina tract through partition. Theamendments allow both tribes andindividual Indians to obtain highlyfractionated interests through a newmechanism, created by AIPRA:consolidation by sale (called partitionof highly fractionated lands in AIPRA).Additionally, the new AIPRAmechanisms being incorporated inprobate regulations will offeropportunities to reduce fractionation

through the distribution of probateproperty. Improve service to beneficiaries:

Amendments to the Land Titles andRecords Office (LTRO) regulations willupdate and standardize LTRO titlepractices and recordation to ensure theSecretary is able to accurately track andrecord accounting of trust and restrictedinterest owners, allowing the Secretaryto better serve the beneficiaries.Amendments to the probate process areaimed at facilitating the process toreduce the probate backlog and betterserve beneficiaries. By clarifying therequirements and processes for probate,

approval of tribal probate codes,obtaining LTRO services and products,and conveying trust and restrictedproperty, the Department improvescommunication and transparency,allowing better service to beneficiaries.

The Department is committed to fullyexplaining both the purpose andintended effects of these regulations inthis preamble. More detailedexplanations of each part are provided

below, followed by summaries ofcomments received during tribalconsultations on the preliminary draftsof these regulations. The Department

welcomes any questions or commentsrequesting clarification of these parts, aswell as additional comments.Additionally, upon finalization of any ofthese regulations, the Department plansto develop training and otherexplanatory materials, whereappropriate, to facilitate transparency inimplementation of these regulations.

IV. Part-by-Part Analysis

The following sections provide adescription of the amendments withrespect to each CFR part and provide

distribution tables listing what currentCFR sections are proposed for change,the new (i.e., proposed) CFR section,and a description of the proposedchanges. Because this proposed ruleincorporates changes made to thepreliminary drafts, which weredistributed to tribes in December 2005,the following part-by-part analysis

includes a discussion of major changesmade to each preliminary draft of theCFR part in response to comments.

A. 25 CFR Part 15

The purpose of this part is to describethe authorities, policies and proceduresthe BIA (or tribe that has contracted orcompacted to fulfill probate functions)uses to prepare a probate file for anIndian decedents trust estate, except forrestricted land derived from allotmentsmade to members of the Five CivilizedTribes (Cherokee, Choctaw, Chickasaw,Creek and Seminole) in Oklahoma.

Amendments to this part reviseseveral subsections to ensure that theprobate file delivered to OHA foradjudication is as complete as possible.By requiring a certification by BIA thatthey have examined certain sources ofinformation and that the file is ascomplete as possible based on thosesources of information, the amendmentswill prevent multiple transfers of theprobate file between BIA and OHA,facilitating the process. Additionalchanges to the records requirements,such as deleting the requirement for a

birth certificate, are also intended tofacilitate the probate process.

The amendments ensure thatinformation is included in the probatefile to determine whether heirs anddevisees meet the AIPRA definition ofIndian. The amendments alsoincorporate definitions regardingAIPRAs new methods for consolidatinginterests at probate:

Consolidation agreements, whichare agreements by the decedents heirsand devisees to consolidate theirinherited/devised interests in trust andrestricted land or consolidate theirinherited/devised interests in land withother interests they already own in trust

and restricted land; and Purchase options at probate, whichallow eligible purchasers to purchase orexchange a decedents interest in trustor restricted land.

Amendments to this part ensure thatthe probate file contains informationnecessary for implementation ofstatutory solutions to fractionation setout in 43 CFR part 4, which addressesOHA probate hearings. Part 15prescribes what must be included in aprobate package and how it will becompiled.



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Changes From Preliminary Draft

Several tribal commenters questionedwhy 25 CFR part 15 and 43 CFR part 4,which both address the probate process,are in separate CFR titles. TheDepartment has determined that

because these two parts addressdifferent agencies25 CFR part 15

addresses BIA preparation of theprobate file, and 43 CFR part 4addresses adjudication of the probatefile once OHA receives it from BIAthese parts are best kept in theirrespective titles.

Several commenters suggested thatthe definitions in both 25 CFR part 15and 43 CFR part 4 should track thedefinitions as set out in ILCA, asamended by AIPRA. The Departmenthas reviewed the regulatory definitions,and amended them as appropriate toensure that they are consistent withAIPRA and with 43 CFR parts 4, 30.

The Department examined andchanged terms, as appropriate, to ensure

consistency with definition of terms in43 CFR parts 4, 30. The Department alsoamended other terminology as a resultof issues raised by tribal commenters:for example, it changed trust financialassets and cash assets to trustpersonalty to encompass both cash andsecurities, and it changedbeneficiaries to devisees, which is

a more precise term including onlythose who receive under a will. Insection 15.8, the Department clarifiedwhat is meant by a self-proved will.

In response to tribal comments, theDepartment also significantly amendedsection 15.14. In the preliminary draft,this section had provided that, pendingprobate, the Secretary could takecustody and control of the estate andtake any action he or she determined to

be necessary for the benefit of the estate,including sale of the land. The versionof this section being proposed todayinstead provides limited emergency

actions that BIA may take when assetsin an estate may be significantly

diminished or destroyed while theprobate is pending. Each of theemergency actions require a request toor hearing before OHA, so no unilateralaction may be taken to sell land pendingprobate under this provision.

At least one tribal commenterobjected to the last provision in section15.106 of the preliminary draft, allowingthe Secretary to request any additionalinformation in support of the probatefile. The Department has deleted theprovision allowing the Secretary torequire additional information insupport of the probate file.

The Department also clarified whenclaims against an estate may be filedand the deadline for filing such claimsin section 15.202.

Distribution Table25 CFR Part 15

The following distribution tableindicates where each of the current

regulatory sections in 25 CFR part 15 islocated in the proposed 25 CFR part 15.

Current citation New citation Title Remarks

15.1 ................................ 15.1 What is the purpose of this part? No change.15.2 ................................ 15.2 What terms do I need to know? Additional definitions.

15.3 Who can make a will disposing of trust or re-stricted land or trust personalty?

New section.

15.4 What are the requirements for my will? New section.15.5 Can I revoke my will? New section.15.6 Can my will be deemed revoked by the operation

of the law of any state?New section.

15.7 What is a self-proved will? New section.15.8 Can I make my will, codicil, or revocation self-

proved?New section.

15.9 Do affidavits for my self-proved will, codicil, or

revocation have to be in a certain format?

New section.

15.3 ................................ 15.10 Will the Secretary probate all the land or assets inan estate?

Clarifies that the Secretary will probate only thetrust or restricted property in an estate.

15.4 ................................ 15.11 How does the probate process work? Administrative changes.15.12 What happens if assets in a trust estate may be

diminished or destroyed while the probate ispending?

New section.

15.101 ............................ 15.103 How do I begin the probate process? Clarifies whom to contact at BIA to inform of adeath.

15.104 Does BIA need a death certificate to prepare aprobate file?

Clarifies that a death certificate should be pro-vided and lists information and documents thatmust be provided if no death certificate is avail-able.

15.102 ............................ 15.102 Who may notify BIA of a death? Plain language.15.103 ............................ 15.101 When should I notify BIA of a death? Plain language.15.104, 15.105 ............... 15.105 What other documents does BIA need to prepare

a probate file?

Clarifies that certain documents may come from

an authority other than a court. Adds require-ment for: orders requiring payment of spousalsupport; identification of person or entity inwhose favor an interest is renounced; court

judgments regarding creditor claims; and placeof enrollment and tribal enrollment or censusnumber of the decedent and potential heirs andbeneficiaries. Deletes requirement for birth cer-tificate.

15.106 ............................ 15.201 Can I get funds from the decedents IIM accountfor funeral services?

Plain language.

15.107 ............................ 15.107 Who prepares a probate file? Incorporates new probate staff definition.15.108 ............................ 15.108 If the decedent was not an enrolled member of a

tribe or was a member of more than one tribe,who prepares the probate file?

Redesignated. Plain language.



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15.106 Can a probate case be opened when an owner ofan interest has been absent?

New section.

15.201 ............................ 15.301 What will BIA do with the documents that I pro-vide?

Clarifies that BIA will also examine other docu-ments and information (beyond those provided)to prepare a complete probate file and willtransfer the probate file to OHA.

15.202 ............................ 15.202 If the decedent owed me money, how do I file aclaim against the estate?

Adds requirements to provide certain additionalinformation in support of claim. Changes dead-line for filing a claim to the conclusion of thefirst hearing rather than 60 days of verificationof death.

15.203 ............................ 15.302 What items must BIA include in the probate file? Clarifies what the certified inventory of trust or re-stricted real property should contain. Adds re-quirements for supporting documents.

15.303 When is a probate file complete? New section.15.301 ............................ 15.401 What happens after BIA prepares the probate

file?Redesignated. Deletes notification to interested

parties.15.302 ............................ 15.402 What happens after the probate file is referred to

OHA?Adds provisions describing how BIA will handle

claims it receives after it refers the probate fileto OHA.

15.303 ............................ 15.403 What happens after the probate decision ismade?

Establishes a 30-day time period to file a writtenrequest for de novo review, a request for re-hearing with the OHA deciding official, or anappeal. Establishes that BIA will not pay claims,transfer title, or distribute assets pending a denovo review, rehearing, or appeal.

15.401 ............................ 15.501 How can I find out the status of a probate? Clarifies that interested parties may contact theBIA agency or regional office.

15.402 ............................ 15.502 Who owns the records associated with this part? Clarifies that records made by or on behalf of theUnited States are owned by the United States.

15.403 ............................ 15.503 How must records associated with this part bepreserved?

Redesignated. Plain language.

15.504 Who may inspect these records? Redesignated. Plain language.15.505 What information must tribes provide BIA to com-

plete the probate file?Establishes that tribes must provide certain infor-

mation when necessary to complete a probatefile.

15.506 How does the Paperwork Reduction Act affectthis part?

New section.

B. 25 CFR Part 18 [NEW]Tribal

Probate Codes

This new CFR part addresses theprocess for obtaining Secretarialapproval of a tribal probate code andlists factors the Secretary will considerin reviewing the tribal probate code forapproval. While tribes have had theauthority to adopt their own tribalprobate codes governing descent anddistribution of trust and restricted landslocated within the tribes respectivereservations or otherwise subject to thetribes jurisdiction, part 18 clarifies thata tribe must obtain Secretarial approvalof the code. This part lists the factorsthe Secretary will consider in reviewinga tribal probate code and establisheswhen an approved code, repeal, oramendment becomes effective. Uponapproval, this part requires the tribe tonotify tribal members of the tribalprobate code.


The Department made several plainlanguage changes to the preliminarydraft, which has resulted in combiningcertain sections and rearranging the

sections to some degree. The

Department added a new subsection (b)to section 18.1 to clarify that a tribalprobate code may provide for a singleheir rule that differs from the oneprovided in AIPRA.

The Department also clarified section18.8(b) (section 18.9 in the preliminarydraft) to provide that a tribal probatecode or amendment will be applied tothe estates of decedents who die on orafter the effective date, rather than thedate of approval, of the tribal probatecode or amendment.

Finally, tribal commenters objected to

section 18.12 of the preliminary draft,which provided how tribes shouldnotify their members of a tribal probatecode or amendment, as an inappropriateincursion into tribal sovereignty. TheDepartment has deleted this section inits entirety.

Note: A distribution table is not includedhere because these provisions are entirelynew.

C. 25 CFR Part 150Indian Land

Record of Title

The LTRO determines, maintains, andcertifies the title status of Indian landand provides various land title productsand services to individual Indians,tribes, and other members of the publicfor land held in trust or restricted status

by the United States. Trust status meansthat title is held by the United States intrust for the benefit of an individualIndian or tribe. Restricted status meansownership of the property is subject toFederal restrictions against alienationand/or encumbrance.

The proposed rule replaces 25 CFRpart 150, Land Records and TitleDocuments, in its entirety, to provideclarification of LTROs procedures andincrease the ability of the LTRO toprovide services and products toIndians, tribes, and the publiccomparable to those provided by stateand local land records offices. Thechanges are described subpart bysubpart, below.

Subpart A of the proposed rule,Purpose, Definitions, and PublicInformation, clarifies that the



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Department will provide access to theinformation in the Indian Land Recordof Title to individual Indians, tribes,and the public, except in thoseinstances where access would violatelaw or policy restricting access to suchrecords. The definition ofIndian landis clarified to include only lands in trustor restricted status and Federalgovernment-owned land that is underthe jurisdiction of the BIA, and not landheld in fee by Indians or fee land subjectto the rights, occupancy, and use ofIndians.

Subpart B of the proposed rule, TheIndian Land Record of Title Designationas the Official Record of Indian Land,designates the Indian Land Record ofTitle as the official record of titleinstruments affecting Indian land. Theproposed rule clarifies that constructivenotice of the existence of the titleinstrument is provided by recording the

instrument in the Indian Land Record ofTitle. Recording instruments with otherFederal or state offices does not provideconstructive notice with regard toIndian land.

Subpart C of the proposed rule, LTROProcedures and Requirements to RecordInstruments in the Indian Land Recordof Title, designates the LTRO as theorganization within the Federalgovernment that has the responsibilityto maintain the Indian Land Record ofTitle. This subpart describes the LTROprocess for receiving and recording titleand the process for correcting an error

or omission in an LTRO product orservice.

Subpart D of the proposed rule,Services and Products of the LTRO,describes the types of services andproducts offered by the LTRO. SubpartD also proposes charging fees to certainparties for the services and productsprovided by LTRO. The proposed feesimplement the authority contained in 25U.S.C. 413 and address a Congressionaldirective, in 31 U.S.C. 9701, for agenciesto begin charging fees that are fair andreasonable based upon the value of theservice provided by the Federal office.

Under 25 U.S.C. 14b, the Secretary mayorder that such funds be directed to theappropriation account for the LTRO. Afee schedule will be published as anotice separate from this proposed rule.The proposed rule specifies exceptionsto the fee.

These proposed provisions willprovide a greater benefit to individualIndians, tribes, and the public throughclarification of LTRO procedures andwill improve LTROs ability to serve

beneficiaries.


Since distribution of the preliminarydraft, the Department made severalchanges to part 150. For example, theDepartment added cross-references to 43CFR part 30 in proposed sections150.206 and 150.207, relating tocorrections of final probate records. The

proposed part 150 also moves twosections regarding how to notify theLTRO of an error or omission in aservice or product from subpart D tosubpart C, for clarity. (See proposedsection 150.208). The Departmentdeleted the section in the preliminarydraft, What certified products does theLTRO produce, and added the section,What services and products may Iorder from the LTRO. Additionalchanges and issues are discussed below.

Terminology: The Department addedlanguage to clarify several definitions,including interest,Land Titles andRecords Office,title, and title

instrument. The Department alsorewrote the definition for tribe to beconsistent with existing regulatorydefinitions for this term.

Throughout the rule, the Departmenthas modified the terminology to clarifythat the rights of the individual

beneficiary and tribe relate to an interestin trust (see also 25 CFR part 179).

Effect on Tribes that Compact orContract LTRO Functions: Several tribalcommenters requested clarification onhow this rule affects tribes that performLTRO functions under a contract orcompact. Records maintained by tribes

under such a contract or compact arepart of the Indian Land Record of Titleand must be maintained under the samestandards and policies. As such, theregulation includes compact andcontract tribes under the definition ofthe Land Titles and Records Office forgrammatical and textual conveniencepurposes. The inclusion of compact andcontract tribes under this definition isnot intended to reflect a limitation onthe sovereignty of these tribes. Certainfunctions performed by the LTRO areinherently Federal functions and canonly be performed by a government

agency. The inclusion of the compactand contract tribes in this definition isnot intended to authorize any such tribeto perform any inherently Federalfunction.

Access to the Indian Land Record ofTitle: Several Indian commenters raisedthe issue of access to LTRO information.Specifically, these commenters pointedout that they are being denied access toLTRO information, sometimes under theauspices of the Privacy Act. The ruleclarifies that the Indian Land Record ofTitle is a public record but that access

is subject to the Privacy Act, Freedomof Information Act, and other law orpolicy restricting access. In someinstances, portions of a copy of the titleinstruments must be redacted under thePrivacy Act to eliminate personalinformation not otherwise included inthe Indian Land Record of Title.Additionally, the Department may

restrict access to reports prepared forthe Secretary. The LTRO performsfunctions other than enteringinformation into the Indian Land Recordof Title and providing copies of mapsand title instrumentsthe LTRO alsotakes the information from the record,reviews and examines and drawsconclusions about it in preparation of areport. Where the LTRO prepares areport for the benefit of the Secretary,the Secretary has the discretion torestrict access to the report. Forexample, the public may not obtain acopy of the Probate Inventory Report

until OHA opens the probate case.While access to the Indian Land Recordof Title may be restricted by theFreedom of Information Act, PrivacyAct, or other law or policy, theDepartment believes that in most cases,neither law or policy will restrict accessto these records by individual Indians ortribes. Generally, information includedin the Indian Land Record of Title will

be available to the public withoutrestriction. The Department has alsoclarified that owners of an interest intrust or restricted land within the samereservation, the tribe or any person thatis leasing, using, or consolidating, or is

applying to lease, use, or consolidate,such trust or restricted land or theinterest in trust or restricted lands mayobtain the following informationwithout regard to the Privacy Act andany exemption contained in theFreedom of Information Act: The names,mailing addresses, information on thelocation of the parcel, and percentage ofthe parcel owned by each individual.

Who Approves Title Instruments: TheDepartment has deleted as unnecessarythe section regarding who the Federalofficials are that approve titleinstruments.

Fees: Based on input received on thepreliminary drafts, the Departmentrecognizes that there is strongopposition to requiring Indians andtribes to pay for LTRO services andproducts. Several tribal commentersalso expressed a preference for chargingfees exclusively to non-Indians becausethey believe that providing LTROproducts and services to non-Indianswithout charge burdens the LTRO anddiverts monies from other Indian andtribal programs. The Departmentwelcomes continued feedback on the



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proposal for charging fees for LTROproducts and services. The Departmentwill continue to review ways tomaximize the efficiency andeffectiveness of the products andservices provided by the LTRO andconsider whether charging fees canassist with this effort. The Departmenthas removed the fee schedule from the

text of the regulation and will publishit in a separate notice. This will allowthe Department to revise the feeswithout having to amend the rule.

LTRO Response Time: During tribalconsultations, several tribal commentersexpressed their frustration at what they

characterized as the slowness of theLTRO in responding to requests toprovide services and products. TheDepartment is currently undergoingimplementation of a technologicalsystem that will provide a centralizeddatabase of the Indian Land Record ofTitle. It is the Departments belief thatthis system will increase the LTROs

ability to respond to requests forproducts and services in a more timelymanner. Several tribal commenterssuggested imposing timelines on theLTRO to respond to requests. Due to thecomplexity and variety of titleinstruments and reports generated from

the information in the Indian LandRecord of Title, the Department isunable to establish a baseline timeperiod. Additionally, the Department

believes that establishing time frameswithin this regulation would limit theflexibility to amend those time frames toreflect changes in processes.


The following distribution tableindicates where each of the currentregulatory sections in 25 CFR part 150is located in the proposed 25 CFR part150.


150.1 ................. 150.1 What is the purpose of this part? Clarifies purpose by expanding on the servicesand products LTRO provides.

150.2 ................. 150.2 What terms do I need to know? Adds several definitions for clarification.150.4 Do I have to be an Indian or a tribe to obtain

products or services from the Lands Titlesand Records Office?

New section.

150.101 Must all title instruments affecting Indian landbe recorded in the Indian Land Record ofTitle?

Designates the Indian Land Record of title asthe official record of title instruments affectingIndian land. Clarifies that recording with theIndian Land Record of Title serves as con-structive notice that the title instrument exists.

150.102 Do I have to check with any other governmentaloffice to find title instruments to Indian land?

Clarifies that the Indian Record of Land Title isthe source of all recorded instruments.

150.3 .... ... .. ... .. ... 150.201 Who maintains the Indian Land Record of Tit le? Establishes the LTRO as the off ice responsiblefor maintaining the Indian Land Record ofTitle.

150.4 ................. 150.202 Where is the LTRO located? Indicates that the LTRO has locations through-out the United States, and that Bureau officesmaintain contact information.

150.5 ................. ........................................ ............................................................................. Deleted.150.6 .... ... .. ... .. ... 150.203 Who submits the t itle instruments for recording? Clarifies that BIA and other government offices

may submit title documents for recording. De-letes specific reference to the AdministrativeLaw Judge submitting probate documents.

150.204 What does the LTRO do with the instrumentsthat it receives?

Restates the steps LTRO takes when it re-ceives documents.

150.205 What are the minimum requirements for record-ing a title instrument?

Clarifies requirements for recording.

150.7 ................. 150.206 What if the LTRO discovers a defect or error ina document?

Specifies LTRO procedures to address defectsor errors discovered after recording.

150.207 What if a defect or error in a final probaterecord cannot be corrected?.

Restates requirement for LTRO notification todeciding official for non-clerical errors in pro-bate records. Establishes that the correcteddocument will be filed in the Indian LandRecord of Title. Deletes reference to Super-intendent and Administrative Law Judges.

150.208 How do I correct an error or omission in a titleinstrument or LTRO product or service?

New section.

150.209 What instruments qualify for recording in with

the LTRO?

New section.

150.210 Does the LTRO maintain the original title instru-ments?

New section.

150.211 May I obtain a copy of the title instrument fromthe LTRO?

New section.

150.301 What services and products may I order fromthe LTRO?

New section.

150.8 ................. 150.302 How do I order services and products from theLTRO?

Discusses how to order any of LTROs servicesand products.

150.303 Does BIA charge fees for any of the servicesprovided by, or products produced by, theLTRO?

New section.

150.304 What will the LTRO do if the instrument con-tains information that is privileged or pro-tected?

New section.



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150.305 How does the Paperwork Reduction Act affectthis part?

New section.

150.9 ................. ........................................ ............................................................................. Deleted.150.10 ............... 150.212 Is there any benefit of obtaining a certified copy

of the title?Restates that a certified copy can be used in

place of an original in court or elsewhere.150.11 ............... 150.3 When can I see land and title information from

the Indian Land Record of Title?Clarifies Department policy to allow public ac-

cess to the Indian Land Record of Title. De-letes provision regarding nondisclosure ofmonetary consideration and provision.

D. 25 CFR Part 152Conveyances

This part establishes the authorities,policy, and procedures governing theconveyance of trust or restricted land.Amendments reorganize this part toclarify the different procedures andrequirements applicable to each type ofconveyance. The reorganized sectionsincorporate statutory solutions aimed atreducing fractionation of interests. Onesuch solution, consolidation by sale, is

newly established by AIPRA.Consolidation by sale allows one ormore eligible bidders to consolidatehighly fractionated land by buying thehighly fractionated interests at fairmarket value through a sale conducted

by the Secretary. The amendments also: Provide instances where consent of

the trust or restricted co-owner is notrequired to convey a fractional interest,making it easier to consolidate interests;

Allow conveyance of land within atribes jurisdiction without tribalconsent where the grantor owns 100%of the tract;

Allow tribes to purchase fractional

interests of non-consenting trust andrestricted owners at fair market value(tribal tract purchases); and

Clarify that the Secretary will havea lien on income derived from anyinterest purchased for a tribe under theIndian Land Consolidation program inthe amount of the purchase price, untilthe lien is satisfied or removed by theSecretary.

The reorganization divides this partinto various subparts. Proposed subpartA, General Provisions, provides relevantdefinitions, describes to whom theSecretary will provide ownership

information related to conveyance inthis part, and establishes the scope ofthe regulations.

Subpart B, Sales and Exchanges ofTribal Trust or Restricted Land,addresses sales and exchanges of triballand pursuant to an approved tribalconsolidation plan and certainexchanges of tribal land. This subpartdescribes what a tribal consolidationplan is, how to obtain approval of sucha plan, and how to obtain approval ofa sale or exchange in the absence oftribal consolidation plan.

Subpart C, Negotiated Sales, Gifts,and Exchanges of Individually OwnedLands, addresses conveyances ofindividually owned trust or restrictedlands. This subpart provides for a tribaloption to purchase any trust orrestricted interests proposed for sale,gift, or exchange to unrestricted feestatus.

Subpart D, Tribal Parcel Purchase,allows tribes to purchase tracts of trustor restricted lands where the tribe eitherowns at least 50% of the undividedinterests in the tract or has obtained theconsent of the co-owners of at least 50%of the undivided interests in the tract,subject to the right of an individualowner in possession of the tract topreempt the purchase.

Subpart E, Consolidation by Sale ofHighly Fractionated Parcels,incorporates the new consolidationmechanism authorized by AIPRA.Consolidation by sale allows eligible

bidders to consolidate interests inhighly fractionated parcels wherecertain consents are obtained. Thissubpart also provides the procedures forconducting the sale by public auction orsealed bid. There is an Application forConsolidation by Sale form associatedwith this subpart. To obtain a copy ofthe information collection requestsubmission to OMB or a copy of theform, send your request to the addressrelated to information collections listedin ADDRESSES.

Subpart F, Partitions in Kind,authorizes the Secretary to subdividetrust and restricted land with multipleowners into smaller tracts in which theinterests of the owners are unified or

consolidated. This subpart allows anyowner of a fractionated interest to applyto the Secretary for partition.

Subpart G, Mortgages and Deeds ofTrust, allows the Secretary to approvemortgages or deeds of trust encumberingindividually owned land under certaincircumstances.

Much of the current regulatorylanguage is redesignated into subpart H,Patents in Fee, Certificates ofCompetency, and Orders RemovingRestrictions, and subpart I, Special

Provisions applicable to Osage and theFive Civilized Tribes.


The Department made several changesto the preliminary draft of 25 CFR part152. Many of the changes are intendedto clarify and make terminologyconsistent.

Definitions: The Department deletedthe definitions for competent andcontiguous and added definitions for

fair market value,family farm, andowner(s). The Department revised thedefinition for Indian.

Land Consolidation Plans: Thepreliminary draft had included a sectionstating that a tribal land consolidationplan may identify for purchase onlylands contiguous to the reservation orotherwise subject to tribal jurisdiction.Several tribal commenters objected tothe provision stating that the tribal landconsolidation plan may identify forpurchase only those lands that arelocated within or contiguous to thetribes reservation boundaries, or

otherwise subject to tribal jurisdiction.One tribal commenter stated thatbecause it does not have fixed exteriorreservation boundaries, this provisionwould prevent it from acquiring otherlands which are in the vicinity of itsseparate trust parcels, but which are notwithin or contiguous to that tribesreservation boundaries. A few tribalcommenters stated that this limitation issubstantive and is not contained inILCA section 2203, and therefore shouldnot be imposed by regulation. Anothertribal commenter stated that thisseverely limits the unrestricted fee lands

the tribe can purchase. The Departmenthas deleted this restriction.Additionally, the Department hasdeleted the definition ofcontiguoussince this deleted provision was theonly appearance of the termcontiguous in the regulation.

Several tribal commenters also notedthat the tribal land consolidation planconditions effectively require tribes topre-identify every transaction to becarried out under the planwhether forsale, purchase, or exchange. Thesecommenters noted that this requirement



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would cause the tribe to submit newplans or plan amendments for everysuch transaction. These commentersalso asserted that this requirement willresult in significant price inflation andforce tribes to pay more for thosetargeted tracts than would be the casewithout the proposed pre-identificationrequirement. The Department has

replaced the requirement for specificallyidentifying sales, purchases, andexchanges with a requirement that theplan include a description and map ofthe general area of the sales, purchases,and exchanges.

Several tribal commenters opposedthe requirement for approval of a triballand consolidation plan as an intrusionon tribal sovereignty. Submission of atribal land consolidation plan isoptional and within the tribesdiscretion. However, an approved landconsolidation plan will allow a tribe tosell parcels of its trust land in

connection with an overall plan toconsolidate its land holdings and/ordecrease fractionation. Pursuant tofederal law, sales under an approvedconsolidation plan may also be atslightly less than fair market value. Ifthe tribe has no plans to sell its trustland, though, there is no need for it toprepare or submit a land consolidationplan for approval.

Finally, the Department clarified theprocess for sales and exchanges with aland consolidation plan and without aland consolidation plan.

Sales and Exchanges: The Departmentrevised section 152.210 (section 152.211

of the preliminary draft) to clarify thata grantor may waive the right to benotified of fair market value only if thegrantee is Indian, among the othercriteria. The Department also deletedsection 152.212 of the preliminary draft,addressing requirements for appraisalsto determine fair market value becausethe proposed draft instead incorporatesthe requirements into the new definitionoffair market value.

Several tribal commenters questionedthe meaning of the provision, trust orrestricted land may only be conveyed toa grantee in unrestricted fee status,

where all of the trust or restrictedinterests in the tract are beingconveyed in section 152.205 (section152.206 of the preliminary draft). The

Department has deleted this phrase andclarified that the Indian tribe withjurisdiction will receive notice and hasthe option to purchase.

The preliminary draft provided thattribal consent for conveyance would berequired if a law affecting probate andinheritance rights was in effect. TheDepartment revised this section to

clarify that tribal consent of aconveyance is required if the tribeenacted a law requiring consent.

The preliminary draft required thetribe to purchase the fractional interestwhere it fails to promptly consent to thesale. The Department has removed thatprovision from the regulation.

Several tribal commenters questioneduse of the U.S. Department of Justice(DOJ) title standards. The Departmentdeleted this reference and instead refersgenerally to Department of the Interior

boundary standards.Several tribal commenters objected to

the proposed provision allowing theSecretary to liquidate off-reservationinterests and allow a tribe to purchasean on-reservation interest where thetransfer creates a different pattern ofjurisdiction or aggravates existingjurisdictional conflicts. This commenterstated that this is contrary to the Federalpolicy of Indian self-determination.Another commenter stated that adistinction should be made betweentrust interests and restricted interests

because tribes have a jurisdictionalresponsibility upon acquisition of the

beneficial interest in trust parcels. TheDepartment has deleted this section.

Tribal Tract Purchases: Two tribalcommenters expressed confusion overthe provision stating that tribal tractpurchase authority does not extend topurchases that are limited to any suchfractional interests held in unrestrictedfee status. The Department has deletedthis provision and clarified that tribaltract purchases may includeconveyances to the tribe of interestsheld in fee and that fee interests areincluded in the calculation to determinewhether the tribe owns at least 50% ofthe tract. With regard to providingnotice of a tribal tract purchase to

owners whose whereabouts areunknown, the Department haslengthened the time before the closingof the sale that publication in a paper

can occur from 30 days to 90 days. TheDepartment has also clarified whataction it will take if it does not approvethe appraisal for a tribal tract purchase.

Consolidation by Sale: Several tribalrepresentatives commented on the factthat an individual holding the largestownership interest in the tract, and 20%

or greater of the ownership interests inthe tract, has a right to match thehighest bid. The Department has notmade any substantive changes to theseprovisions because they are prescribed

by AIPRA. One tribal commenter statedthat the regulation should clarify that

both trust and fee interests are subjectto consolidation by sale. TheDepartment has clarified this in section152.402. Another tribal commenterasked whether a fee interest ownerwould be able to trigger a consolidation

by sale. Proposed section 152.403entitles only eligible bidders tosubmit applications for consolidation bysale. A fee owner may submit anapplication if he or she meets one of thecategories for eligible bidder. Finally,the Department revised the definition ofbona fide and made otherclarifications.

Partition in Kind: The Departmentsimplified section 152.501, establishingwhat tracts may be partitioned anddeleted the provision excludingpartitions of restricted land in Alaska.The preliminary draft included aprovision at section 152.606(b) statingthat the tribe will not have the right of

first refusal where encumbered land ispurchased as a result of a foreclosure orsale proceeding. Several tribalcommenters asserted that the tribeshould have the right to purchaseinterests that are to be foreclosed andare to be taken into unrestricted feestatus. The Department has deleted thisprovision and instead states that titlewill be taken in accordance with lawsapplicable to the foreclosure or saleproceeding.


The following distribution table

indicates where each of the currentregulatory sections in 25 CFR part 152is located in the proposed 25 CFR part152.

Currentcitation

New citation Title Remarks

152.1 What does this part do? New section.

152.1 ............ 152.2 What terms do I need to know? Adds and amends definitions.

152.3 Will the Secretary provide ownership information? New section.

152.4 To whom will the Secretary provide ownership informa-tion?

New section.

152.5 Which subparts do not apply to Alaska? New section.



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Currentcitation


152.2 ............ 152.101 What transactions are covered by this subpart? Incorporates AIPRA principles by clarifying that theSecretary will only approve sales of tribal land whenmade in accordance with a consolidation plan.

152.102 What must a land consolidation plan include? New section. Lists items that must be included in a trib-al land consolidation plan.

152.103 Are there any restrictions on a land consolidation plan? New section.152.104 How does the Secretary approve a land consolidation

plan?

New section.

152.105 How does a tribe receive approval for a sale or ex-change under a land consolidation plan?

New section.

152.106 How may the tribe use the proceeds of a sale or ex-change?

New section.

152.107 In the absence of an approved land consolidation plan,how does a tribe get approval for an exchange oftribal land?

New section.

152.108 What criteria will the Secretary use to determine wheth-er to approve an exchange?

New section.

152.3 ............ .................... .......................................................................................... Deleted.152.4 ............ 152.701 Application for patent in fee ............................................ Redesignated.152.5 ............ 152.702 Issuance of patent in fee ................................................ Redesignated.152.6 ............ 152.703 Issuance of patents in fee to non-Indians and Indians

with whom a special relationship does not exist.Redesignated.

152.7 ............ 152.704 Application for certificate of competency ........................ Redesignated.152.8 ............ 152.705 Issuance of certificate of competency ............................ Redesignated.152.9 ............ 152.801 Certificates of competency to certain Osage adults ....... Redesignated.152.10 .......... 152.802 Application for orders removing restrictions, except Five

Civilized Tribes.Redesignated.

152.11 .......... 152.803 Issuance of orders removing restrictions, except FiveCivilized Tribes.

Redesignated.

152.12 .......... 152.804 Removal of restrictions, Five Civilized Tribes, after ap-plication under authority other than section 2(a) ofthe Act of August 11, 1955.

Redesignated.

152.13 .......... 152.805 Removal of restrictions, Five Civilized Tribes, after ap-plication under authority of section 2(a) of the Act ofAugust 11, 1955.

Redesignated.

152.14 .......... 152.806 Removal of restrictions, Five Civilized Tribes, withoutapplication.

Redesignated.

152.15 .......... 152.807 Judicial review of removal restrictions, Five CivilizedTribes, without application.

Redesignated.

152.16 .......... 152.808 Effect of order removing restrictions, Five Civilized

Tribes.

Redesignated.

152.17,(152.18).

152.203 Who may convey an interest in trust or restricted land? Clarifies who may convey interests with Secretarial ap-proval.

152.19 .......... .................... .......................................................................................... Deleted.152.20 .......... .................... .......................................................................................... Deleted.152.21 .......... 152.201 What lands are covered by this subpart? Clarifies scope of subpart.

152.202 What transactions are covered by this subpart? Clarifies scope of subpart.152.22 .......... .................... .......................................................................................... Deleted.

152.204 Who can receive an interest in trust or restricted lands? New section.152.205 What restrictions apply to a conveyance of trust or re-

stricted land to fee status?New section.

152.23 .......... 152.206 How does an owner initiate a negotiated sale, gift, orexchange?

Clarifies what a written request for negotiated sale, gift,or exchange must include.

152.207 Does a conveyance of a fractional interest require theconsent of the co-owner(s)?

New section.

152.208 Is tribal consent required to convey an interest in trustor restricted land located within the tribe s jurisdic-

tion?

New section.

152.24 .......... 152.210 When must fair market value be determined and pro-vided to the grantor?

Establishes circumstances in which grantor may waiveright to be provided with information as to the fairmarket value.

152.25 .......... 152.209 Is payment required for a negotiated sale, exchange, orgift?

Removes restrictions for conveyances at less than fairmarket value because 152.210 entitles the grantor tofull information regarding the fair market value.

152.211 When must the Secretary receive payment for the con-veyance of the land?

New section.

152.212 How does the Secretary decide to approve a nego-tiated sale, gift, or exchange?

New section.

152.213 How does the negotiated sale or exchange occur? New section.152.214 When is a negotiated sale, gift, or exchange effective? New section.152.215 How does an Indian Land Consolidation Program lien

attach?New section.



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Currentcitation


152.216 How is an Indian Land Consolidation Program lien re-moved?

New section.

152.217 When can a co-owner acquire an interest previouslyacquired on behalf of the tribe?

New section.

152.218 What if there are liens or other encumbrances on thelands to be conveyed?

New section.

152.301 What lands are covered by this subpart? New section.

152.302 What transactions are covered by this subpart? New section.152.303 How does a tribe apply for a parcel purchase? New section.152.304 How and when will owners be notified of an application

for tribal parcel purchase?New section.

152.305 Can an individual owner preempt and succeed a tribesright to purchase?

New section.

152.306 How and when will the Secretary review an applicationfor parcel purchase?

New section.

152.307 How and when will the conveyance instrument be exe-cuted?

New section.

152.401 What terms do I need to know? New section.152.402 What lands are subject to consolidation by sale? New section.152.403 How do I apply to consolidate a parcel by sale? New section.152.404 What must the Secretary do before acting on an appli-

cation for consolidation by sale?New section.

152.405 What consents are necessary for a consolidation bysale?

New section.

152.406 How will the Secretary notify owners of the consolida-tion proceeding?

New section.

152.407 What action does the Secretary take on comments orobjections?

New section.

152.408 What happens if the Secretary orders a new appraisal? New section.152.409 How can an owner appeal a consolidation by sale pro-

ceeding?Limits discussion of advertising to consolidation by

sale.152.26 .......... 152.410 How will the Secretary notify owners of a sale after ap-

peals have been decided?Limits discussion of advertised sale to consolidation by

sale.152.27 .......... 152.411 Who may participate in an auction or sealed bid sale? New section.

152.412 How does a tribe reserve its right to match the highestbid?

New section.

152.28 .......... 152.413 How will the Secretary determine the successful bid-der?

New section.

152.29 .......... 152.414 What happens if no bid matches the fair market value? Deletes provisions allowing the Secretary to reject bids.152.30 .......... .................... .......................................................................................... Deleted.

152.415 When must the highest bidder pay for the purchase? New section.

152.416 How will proceeds be distributed? New section.152.417 Is Federal financial assistance available to support abidders purchase?

New section.

152.418 What title is acquired? New section.152.31 .......... .................... .......................................................................................... Deleted.152.32 .......... 152.219 How does a transaction affect collection of construction

costs for irrigation projects?Plain language.

152.33 .......... .................... .......................................................................................... Deleted. See subpart F.152.34 .......... .................... .......................................................................................... Deleted. See subpart G.152.35 .......... .................... .......................................................................................... Deleted.

Subpart FPartitions in Kind

152.501 What lands are covered by this subpart? New section152.502 When does this subpart apply? New section.152.503 How can an owner initiate a partition action? New section.152.504 How will we notify the applicants co-owners of an ap-

plication for partition?New section.

152.505 How and when will we review an application? New section.152.506 When will we execute the conveyance instruments? New section.

Subpart GMortgages and Deeds of Trust

152.601 What does this subpart do? New section.152.602 How do owners submit an application for approval of a

mortgage or deed of trust?New section.

152.603 How will the Secretary review the application? New section.152.604 How may the mortgage or deed of trust be enforced? New section.152.605 Does the land remain in trust as a result of foreclosure

or sale?New section.

152.606 How does the Paperwork Reduction Act affect thispart?

New section.



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E. 25 CFR Part 179Life Estates andPresent and Future Interests

This regulation sets forth theauthorities, policy and proceduresgoverning the administration of lifeestates and future interests in Indianlands by the Secretary of the Interior.

Amendments to this part explicitlyidentify the rights and responsibilitiesof the life tenant, and define the lifetenants share of income, contract

bonuses, and royalties derived from theuse of the land and the extraction ofminerals or other resources from theland. AIPRA established that life estatesare without regard to waste, meaningthat the life tenant is entitled to allincome, contract bonuses, and royaltiesderived from use of the land andextraction of resources. Theamendments to this part incorporatethis change, providing that all lifeestates created after June 20, 2006, will

be entitled to all income, contract

bonuses, and royalties, in the absence ofan order, conveyance document, orwritten agreement specifying otherwise.

The amendments delete the SingleLife Factor table for determining therespective values of a life estate andremainder share and instead refer toActuarial Table S, Valuation ofAnnuities, obtained from 26 CFR20.2031. The amendments alsoeliminate the distinction between thegenders in determining the value of alife estate; the current regulationsgenerally value life estates held byfemales higher than those held bymales.

New sections address several topicsthat allow the Department to determinethe type of estate and interest in whicha beneficial interest may be held, toensure that the holder of a life estate,the measuring life for a life estate, theholder of a future interest, and classmembers can be ascertained in all cases,including when the conveyancedocument or probate order includesconditions. The amendments alsoaddress the termination andrenunciation of life estates, establishwhy notification to BIA of the death ofa life tenant is important, and establish

that term estates will be treated in thesame manner as life estates for thepurposes of distributing income, cash

bonus, and principal.


The Department added several newdefinitions, including class,condition,contingent remainder,conveyance document,estate,executory interest,extant person,grantee,grantor,holder,lifetenant,open class,order,present

interest,remainderman,reversionary interest,Secretary,term estate, and vested. TheDepartment also added several sectionsand expanded others since it releasedthe preliminary draft of part 179.

Effect of State Law: The preliminarydraft stated that the Department wouldlook to state law for guidance in the

absence of Federal law or Federallyapproved tribal law. This section has

been deleted because the Office ofHearings and Appeals will determinewhen it is appropriate to look to statelaw.

Ascertaining Beneficial Interests andClasses: The Department has addedseveral provisions that ensure that theDepartment can determine the type ofestate and interest in which a beneficialinterest may be held. For example,proposed section 179.3 ensures that theinterest in a life estate vests only inspecific, living persons, withoutconditions. Proposed section 179.4ensures that the measuring life for alife estate is a specific person who isliving at the time the conveyancedocument is approved or testator dies.Proposed section 179.5 ensures that theinterest in future interest holders vestsonly in specific, extant persons, and ifthere are conditions, that thoseconditions can be satisfied before theSecretarys approval of the conveyancedocument, if the future interests arecreated by conveyance document, or bythe death of the testator, if the futureinterests are created by will. Thissection will, in practice, forbid

successive future interest in personswho are non-specific, non-livingpersons. Likewise, proposed sections179.6, 179.7 and 179.8 indicate that,where the conveyance or will grants aninterest to a class, the class will closeand any conditions must be satisfiedupon approval of the conveyancedocument or death of the testator.Proposed section 179.8 also describesthe circumstances in which theSecretary may close or open a class.These changes allow the Secretary toknow, at the time of approval ofconveyance document or death of the

testator, who holds the beneficialinterests.Without Regard to Waste: During

tribal consultations and during theperiod leading up to the publication ofthis proposed rule, several tribalcommenters expressed concern with thepreliminary drafts definition ofwithout regard to waste and thephrases effect on protection of theremaindermans interest from abusivepractices of the life tenant. AIPRA statesthat all life estates created on or after

June 20, 2006, shall be without regardto waste and defines this phrase asmeaning that the life tenant shall beentitled to all income, including

bonuses and royalties, to such land tothe exclusion of the remaindermen. TheDepartment has incorporated thisconcept into the regulations at proposedsection 179.12, which provides that,

where the order, conveyance document,or written agreement does not specifyotherwise, life tenants will be entitled toall income, principal, contract bonuses,and royalties where the life estate wascreated by a conveyance document afterthe effective date of this regulation or byan order in a probate case where thetestator died on or after June 20, 2006.

The Department has also addedsections 179.9, 179.10 and 179.11,which respectively establish theprivileges of a life tenant, theresponsibilities a life tenant has to theremainderman, and action aremainderman may take to stop a lifetenant from damaging and substantiallydiminishing property. Section 179.10specifically states that, with respect tolife estates created by probate order after

June 20, 2006, or by conveyancedocument after the passage of thisregulation, the life tenant may notdestroy the estate, commit maliciouswaste, or fail to reasonably manage theland in a manner consistent with long-term utilization and trust status of theland.

Sale or Leasing of Interests: TheDepartment has clarified in proposedsection 179.9 that the life tenant mayrent or sell the life estate interest tosomeone else. Additionally, section179.10 notes that provisions regardingthe relationship between a life tenantand remainderman do not restrict oramend the authority of the Secretary toconsent on behalf of interest owners tothe leasing or transfer of Indian land.

Value of Current Life Estate andRemainder: Several tribal commentersidentified an issue with placing theSingle Life Factor chart directly into thetext of the regulation, stating that it will

be difficult to update. The Departmenthas addressed this issue by deleting theSingle Life Factor chart from the text ofthe regulation and instead referring toan existing chart that is frequentlyupdated.


The following distribution tableindicates where each of the currentregulatory sections in 25 CFR part 179is located in the proposed 25 CFR part179.



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Currentcitation


179.1 ............ 179.1 What is the purpose of this part? Clarifies that these regulations do not apply to any Fed-eral statutory rights to purchase.

179.2 ............ 179.2 What terms do I need to know? Adds several definitions.179.3 ............ .................... .......................................................................................... Deleted.

179.3 Who can hold a life estate? New section.179.4 Who can be the measuring life for a life estate? New section.179.5 Who can be designated as a future interest holder? New section.

179.6 Who can be members of a class? New section.179.7 How are interest holders determined if the conveyance

document or order contains conditions?New section.

179.8 How are members to be determined if there is an openclass?

New section.

179.9 What are the privileges of a life tenant? New section.179.10 What is the life tenants responsibility to the remain-

derman?New section.

179.11 How can a future interest holder stop the life tenantfrom damaging his/her interest and substantially di-minishing its value?

New section.

179.4 ............ 179.12 How will the Secretary distribute income and principalbetween the life tenant and the remainderman?

Incorporates AIPRA provisions for life estates createdafter AIPRAs effective date, providing that these lifetenants are entitled to all income, principal, contractbonuses, and royalties.

179.5 ............ 179.13 How will the value of a current life estate and remain-der be determined?

Replaces existing life estate value tables with a ref-erence to one table. Deletes gender as factor affect-

ing life estate values.179.14 How does a life estate terminate? New section.179.15 What if I do not want an interest in a life estate? New section.179.16 Why do I need to notify the Secretary about the death

of a life tenant?New section.

179.17 How will term estates be treated? New section.179.6 ............ .................... .......................................................................................... Deleted.

F. 43 CFR Part 4, Subpart D

Currently, subpart D of 43 CFR part 4addresses how OHA adjudicates theprobate file that BIA prepares under 25CFR part 15. The amendments removethe probate hearing procedures to a new

part 30. See the discussion of thesechanges below.

G. 43 CFR Part 30

The amendments make manyadministrative changes to the part to

better meet plain language requirementsand make the OHA probate process astransparent as possible. In addition, theamendments make several substantivechanges. Amendments to this partclarify the two types of probateproceedings (summary and formal),simplify the deadline for filing a claimagainst an estate, and clarify the

authority of administrative law judges,Indian probate judges, and attorneydecision makers.

Other amendments reduce the impactof fractionation on trust and restrictedlands and expand land consolidationoptions by incorporating administrativeprocedures to implement AIPRAprovisions related to consolidationagreements, renunciations in favor of adesignated recipient, and purchaseoptions at probate. Consolidationagreements permit heirs and devisees toexchange interests in trust or restricted

lands for the purpose of consolidatingownership. Renunciations in favor of adesignated recipient enable heirs ordevisees that would have inherited atrust or restricted interest to renouncethat interest in favor of another eligible

party. The availability of the option topurchase a decedents trust or restrictedinterests has been expanded to allowtribes, eligible family members, and co-owners of trust or restricted interests toexercise the option.


Because a significant number of issueson 43 CFR part 4 were identified intribal comments, the followingdiscussion addresses the issues bysubheading in the new 43 CFR part 30.

Overall: The Department reorganizedsome sections in this subpart to provide

a better logical flow. For example, theDepartment moved former sections4.382 and 4.383, related to the omissionand improper inclusion of property inan estate, to sections 30.126 and 30.127under the Judicial Authority andDuties subheading. Additionally,former section 4.216, related to whathappens when a person dies without awill and has no heirs, has been movedto section 30.254 under theMiscellaneous subheading. Section4.217, related to settlement agreements,has been moved to section 30.150,

under the new subheadingConsolidation and SettlementAgreements (formerly, this subheadingincluded only consolidationagreements). Provisions related to tribalpurchase of interests under special

statutes (sections 4.290 through 4.304 ofthe preliminary draft) have been movedto sections 30.260 through 30.274. TheDepartment also added a few sectionsunder the Renunciation of Interestsand Summary Probate Proceedingssubheadings for clarity.

The Department and tribalcommenters identified potentialconfusion regarding references toallocated market value,estimatedmarket value, and appraised marketvalue. The Department has addressedthis issue by deleting references toallocated and estimated marketvalue and replaced them withappraised market value.

Several tribal commenters noted thatwhile the preliminary drafts establishedtimelines for filing an appeal, they didnot impose any timelines on OHA toact. For example, several tribalcommenters suggested placing adeadline on OHA for designating a caseas appropriate for summary or formalhearing and assigning a case to a judge10 days after receiving the file from BIA.Other tribal commenters suggestedimposing a timeframe on notifying



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potential heirs that a probate case hasbeen assigned to a judge. Another tribalcommenter recommended setting timeperiods for holding the hearing andissuing a final decision in a probatecase. The Department has determinedthat, given the variation in complexityand resources available, establishing settimelines for judges would not be

feasible.Definitions: In response to tribal

comments, the Department modified thecurrent definition ofinterested partiesto ensure that tribes and co-owners withthe option to purchase are included inthe definition. Several tribalcommenters were concerned that thedefinition in the preliminary draft wastoo narrow, and would not providenotice to persons with an interest. Therevised definition includes tribes andpersons with the option to purchase atprobate and all co-owners. (Seeproposed section 30.102).

Additionally, the Department revisedseveral definitions included in thepreliminary draft to ensure consistencywith AIPRA and 25 CFR part 15. TheDepartment amended the definition ofchild to include adopted children, inresponse to tribal comments that

biological and adopted children shouldbe treated equally in the distribution ofproperty at probate. The Departmentalso amended other terms for precision:for example, it changed trust financialassets and cash assets to trustpersonalty to encompass both cash andsecurities; it changed beneficiaries todevisees, which is a more precise

term including only those who receiveunder a will; it revised the definitionsfor per stirpes and de novo forclarity; and it deleted the placeholdersfor definitions for residing on andpretermitted spouse, havingdetermined that meanings for theseterms are subject to judicialdetermination based on fact-specificcircumstances.

Commencement of ProbateProceedings: The Department clarifiedin section 30.114 that OHA will providenotice of the formal or summary probateproceeding and eliminated the

requirement for BIA to notify potentialheirs and devisees when it forwards theprobate file to OHA for consideration

because sufficient notice is provided byOHA upon designation of the case for aformal or summary probate proceeding.

Judicial Authority: The Departmentamended section 4.220 of thepreliminary draft, relating to the judgesgeneral authority. It is now designatedas section 30.120. In proposedsubsection (f), the Department clarifiesthat the probate decision and order, notthe terms of the sale, determine how the

sale at probate and distribution ofinterests will occur. The Departmentalso clarifies in proposed subsection (i)that the judge first determines whetherthe tribe has jurisdiction over the trustor restricted property at issue.

The Department clarified the standardagainst which a judge may determine aperson to be dead based upon an

extended unexplained absence. Therevisions require credible evidence toestablish, by a clear and convincingstandard, that the person has had noknown contact with any person or entityduring the six-year period preceding thehearing. (See proposed section 30.124).

Claims: Tribal commenters pointedout that deadlines for filing claims were

both unclear and potentially conflicting.The Department significantly amendedthe provisions related to deadlines forfiling claims to simplify the deadlineand make consistent with 25 CFR part15. The deadlines established in the

preliminary draft complicated thematter of determining timeliness ofclaims and introduced both factual andlegal issues, including choice of lawissues, to determine when the creditorwas chargeable with notice.Additionally, the preliminary draftcontinued the current requirement thatthe creditor file with BIA rather thanOHA. This requirement is no longerappropriate since BIA no longerconducts any probate hearings. For thisreason, the Department is allowingfiling of claims with BIA while theprobate file is being prepared, or with

the OHA once the probate file has beentransferred to the OHA. The Departmenthas also clarified what must be includedin a claim and eliminated therequirement for filing in triplicate.Additionally, the Department deletedthe section related to priority andgeneral claims (what had been sections4.245 and 4.248 in the preliminarydraft).

Settlement and ConsolidationAgreements: The Department placedprovisions relating to settlementagreements with those relating toconsolidation agreements. Revisions to

the sections on consolidatio

Proposed Rule: Indian trust management reform

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