Legislation removes Interior Department from Navajo Nation leasing decisions

WINDOW ROCK—Business site leasing on the Navajo Nation will soon become a little easier, thanks to approval of S. 2665 by the Senate Indian Affairs Committee, September 28.

Introduced by Senator Jon Kyl (R-AZ), the bill, also known as the Navajo Nation Trust Leasing Act, was marked up and favorably reported to the full Senate.

The legislation establishes a streamlined process for the Navajo Nation to lease trust lands without having to obtain the approval of the Secretary of the Interior.

Tony Skrelunas, executive director of the Navajo Nation Division of Economic Development, said, “The Navajo Nation is proceeding with legislation in congress to amend Section 415 and get the BIA out of the business leasing process—this will enable the Navajo Nation to develop business friendly regulations.”

Said Kyl, “The current leasing process simply doesn’t work very well. It can be cumbersome and lengthy because of the need to obtain approval from both the Nation and the Interior Department. That can discourage many businesses from even considering locating to the Navajo Reservation.”

“There’s no longer a need for the Secretary to be involved in routine leasing decisions that can and should be made by the Nation itself.”

Changes in the bill are intended to speed up the process of issuing leases by at least 50 percent, create predictable procedures for leasing trust land and create incentives for businesses to open and operate in on the Navajo Nation. This new authority would apply to individual leases, expect leases for the exploration, development or extraction of any mineral resources.

The legislation would also help improve the management of tribal property and promote economic development within the 100 chapters of the Navajo Nation.

For example, Skrelunas said, the Navajo Nation can augment its economy if it charges rental rate that is based on the value of the land and reward businesses for improving the value of the land. Moreover, Skrelunas said, the Navajo Nation can identify areas which are “hot” or prime properties and charge a rental rate based on the higher values of other properties in the area.

Additionally, Skrelunas said businesses that are situated within a Enterprise Zone area can be charged lower rates until the economic conditions of the area improve. To professionally manage leases like they are managed off the off the reservation, Skrelunas said, the Navajo Nation will either develop a section 17 business real estate development corporation or contract out this function so that it is professionally handled with incentives for high performance.

The company, he said, would identify the best sites on the Navajo Nation, enter into agreements with local chapters, do all the land withdrawals and clearances, complete the infrastructure master lease sites, sublease to tenants, and manage the property.

“This organization, after re-couping its investment, can charge a minimal management fee to the chapters that are LGA certified,” he said. “This would be a unique public/private partnership and address many of the processing problems we currently encounter with leasing including the financing of infrastructure, which can be accomplished quickly through such an entity.”

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