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The Institute for Indian Estate Planning and Probate. A project of the Indian Land Tenure Foundation At Seattle University School of Law Opened doors on August 1, 2006. The Institute for Indian Estate Planning and Probate.

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the institute for indian estate planning and probate
The Institute for Indian Estate Planning and Probate
  • A project of the Indian Land Tenure Foundation
  • At Seattle University School of Law
  • Opened doors on August 1, 2006

www.indianwills.org

the institute for indian estate planning and probate3
The Institute for Indian Estate Planning and Probate
  • The mission of the Institute for Indian Estate Planning and Probate is to assist Indian people in making informed decisions about their property by:1. Establishing legal service projects that provide free and reduced cost estate planning services to individual tribal members2. Providing training to tribal members, governmental officials and the legal community3. Serving as a clearinghouse for the latest information on the American Indian Probate Reform Act

www.indianwills.org

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www.indianwills.org

www.indianwills.org

the american indian probate reform act of 2004 legislative and regulatory updates
The American Indian Probate Reform Act of 2004Legislative and Regulatory Updates

www.indianwills.org

three statutes
Three Statutes

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slide7
Original ILCA– Enacted/amended 1983-1984;

Largely dependent on Tribes and unimplemented, except for the self-executing “2% Rule” which was held unconstitutional by the U.S. Supreme Court in Irving (1987) and Youpee (1997)

  • ILCA 2000 – Enacted November 7, 2000;

Purported to establish sweeping Inheritance Restrictions (including very narrow Definition of “Indian”), authorized Buyback Program as a “Pilot,” and modified Rules on Day-to-Day Title and Land Use Transactions

  • AIPRA (P.L. 108-374) - Enacted October 27, 2004, with Technical Amendments enacted December 30, 2005 (P.L. 109-157) and May 12, 2006 (P.L. 109-298, Title V);

Supersedes never-effective Probate Provisions in ILCA 2000, permanently authorizes and broadens Applicability of Buyback Program, and provides DOI and Owners with new Tract Consolidation “Tools”

www.indianwills.org

proposed technical amendment
Proposed Technical Amendment
  • Senate Bill S. 3526 dated November 13, 2006
  • Died at end of last Congressional session
  • Would have altered the definition of land, delayed implementation of purchase option at probate provisions and enhanced provisions for lineal descendant's and spouses
  • Currently being reviewed by new Senate Majority Counsel Allison Binney

www.indianwills.org

ilca provisions removed
ILCA provisions removed
  • No 2% Rule such as the one held unconstitutional in Irving and Youpee – Even after Youpee, “Escheat” Provisions had been included in draft Bills that preceded the Enactment of ILCA 2000, based on a narrow reading of the Supreme Court’s Decisions, but those Provisions were ultimately rejected by Congress

www.indianwills.org

ilca provisions removed10
ILCA provisions removed
  • No Tribal Court Probate Jurisdiction for Trust Property, even where Tribe has adopted its own Probate Code, probate will occur in federal court and the tribal code will be applied
  • No Federal Inheritance Restrictionsbased on Membership in Tribe on whose Reservation the Land is located (though Tribe can still adopt its own Probate Code to impose such Restrictions)

www.indianwills.org

slide11

ILCA provisions removed

  • No “Passive Trust” Form of Ownership,
  • No Different Inheritance Rules for Acquired vs. Inherited Interests of Decedents, and
  • No Condemnation Authority that would facilitate the Consolidation of Fee Interests

These Provisions were in ILCA 2000 Amendments passed by the Senate in 2002, but never taken up by the House of Representatives

www.indianwills.org

examples of provisions in ilca that remain effective
Examples of provisions in ILCA that remain effective
  • Flexibility in Transfer/Exchange of Tribal Land (for any Combination of Cash and Land equal to 90% of FMV), with Proceeds earmarked for Acquisition of other Land identified in Tribal Land Consolidation Plan – BIA’s Role: Plan Approval required by Section 204, which has seen Minimal Changes since Enactment of Original ILCA

www.indianwills.org

examples of provisions in ilca that remain effective13
Examples of provisions in ILCA that remain effective
  • Tribal Tract Purchases at no less than FMV, with Majority (now 50%) Consent or Ownership – BIA’s Role: Transfer of Interests of Non-Consenting Owners required by Sections 205(a)-(b), which have seen Minimal Changes since Enactment of Original ILCA

www.indianwills.org

purpose of aipra
Purpose of AIPRA

Preserves Trust Status and Tribal Jurisdiction by:

  • Restrictions on Non-Indian Inheritance (in Fee Status) and Processing of Trust-to-Fee Applications, imposed directly by Federal Law;
  • Further tribal authority to adopt Tribal Probate Codes and thereby restrict Non-Member (Indian) Inheritance, to ensure Tribal Jurisdiction, with such Tribal Restrictions to be administered by OHA, as Federal Law

www.indianwills.org

purpose continued
Purpose continued

To Empower Tribes and Individual Indian Landowners by:

  • Streamlines Trust-to-Trust Consolidation,
  • Encourages Negotiated Land Use Transactions,
  • Authorizes “Owner Management” of Agricultural Land, and
  • Provides Tribes with Flexibility in dealing with Tribal Land

www.indianwills.org

purpose continued16
Purpose continued

To Attack Fractionation (a DOI Priority) by:

  • Cuts off Collateral Heir Inheritance and limits further Fractionation in Intestacy via “Single Heir Rule”;
  • Earmarks Federal Funds for Tribal Consolidation via the Buyback Program,
  • Authorizes Tribal Tract Purchase with Majority Consent of Ownership (50%)
  • Allows Competitive Sale of “Highly Fractionated” Tracts upon Application of any one Owner

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the regulations

The Regulations

Proposed to Implement AIPRA

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regulations
Regulations
  • New proposed federal regulations implementing AIPRA published August 8, 2006 –
  • Federal Register, Vol. 71, No. 152, 45205 - 45244
  • Comment period ended March 12, 2007

www.indianwills.org

25 cfr
25 CFR
  • Part 15 - Probate of Indian Estates, except for members of the Five Civilized Tribes
  • Part 18 – Tribal Probate Codes
  • Part 150 – Indian Land Record of Title
  • Part 152 – Conveyances of Trust or Restricted Indian Land; Removal of Trust or Restricted Status

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43 cfr
43 CFR
  • Part 4 – Department Hearings and Appeals Procedures
  • Part 30 – Indian Probate Hearings Procedures

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appraisal
Appraisal

Determination of fair market value of interest to be sold at probate:

Original and early draft regulations provided it would be based upon an appraisal of the entire parcel without consideration of the fractionation of ownership of the parcel.

www.indianwills.org

appraisal22
Appraisal

43 CFR 30.168 – August 8, 2006, Draft

Provides that fair market value of interest to be sold at probate must be based upon an appraisal which gives appropriate consideration to the fractionated ownership interest in the parcel.

www.indianwills.org

appraisal23
Appraisal

Application of Discounting to all Appraisals?

Recommendation contained in John Widoss Report – May 5, 2006

Research on “Appraisal of Highly Fractionated Interests on Indian Lands.”

www.indianwills.org

appraisal24
Appraisal
  • Recommends that interests that are 10% or less be discounted 100% - meaning they would have no value

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appraisal25
Appraisal
  • Analysis of Widoss Report by Independent Appraiser:

“Approximately 70% to 90% of land interests in the Great Plains Region are less than 2%. The Interests that are less than 10% is even greater. Using John Widoss recommendations most land interests (at least 90% or more) would be appraised as zero value.

www.indianwills.org

appraisal26
Appraisal
  • Potentially effects:
    • Any sale or purchase of interest in trust land;
    • Fee to trust transfers
    • Leases and right of ways
    • Land value for collateral

www.indianwills.org

www indianwills org or contact 901 12 th avenue po box 222000 seattle wa 98122 206 398 4284
www.indianwills.orgor contact901 12th AvenuePO Box 222000Seattle, WA 98122(206) 398-4284

www.indianwills.org