DENVER – When environmental laws were enacted in the 1970s, people had no idea what they would later entail, an Indian law practice attorney told an energy conference.

“I don’t think they understood that environmental statements could go on for three or four years and involve millions of dollars,” Douglas C. MacCourt said in an address to Tribal Energy Program attendees.

The level of public involvement and National Environmental Policy Act compliance is significant, and that is a factor when considering Tribal Energy Resource Agreements, he said.

MacCourt addressed tribal leaders and others who attended a conference on tribal renewable energy business development and financing July 27 – 29, sponsored by the Department of Energy’s National Renewable Energy Laboratory in Golden, which adjoins Denver.

He analyzed business structures and joint ventures to capture tribal opportunities, and said DOE’s Tribal Energy Program can help tribes evaluate what role they want to play in energy development projects.

Under TERA, it is assumed that the tribe has a NEPA-like process in place and that it is “small and nimble enough” to get the project accomplished in a timely way.

TERA may be helpful if there are several projects that require environmental impacts evaluation, because conventional, tiered environmental impact statements can take a long time for completion and approval, he said.

Although TERA may diminish federal oversight, involvement of the Department of the Interior and NEPA might be triggered if the project tangentially involved a federal power plant, for example, it was noted.

TERA, authorized under the 2005 Energy Policy Act, was to make it possible for tribal nations to submit voluntary umbrella resource development plans to the BIA, bypassing lengthy case-by-case approvals required in the past.

The process evolved from a multi-tribal initiative to reduce the red tape around applications for energy development on tribal lands, where delay sometimes resulted in lost business opportunities. Under TERA, however, tribal nations assume some of the risk and responsibility formerly held by the BIA and they may bear the financial cost of TERA administration.

MacCourt took conferees through the nuts and bolts process of tribal energy development with tribal and non-tribal entities, describing the advantages and limitations of working through corporations, partnerships, or limited liability corporations, the last described as the most common form of tribal/non-tribal collaboration.

The LLC as a joint venture entity is the most common between tribes and non-tribal businesses because it “combines the limited personal liability of corporate status with the pass-through tax feature of partnerships” though it does not enjoy sovereign immunity.

Key sticking points in collaboration may include issues of sovereign immunity, exhaustion of remedies in tribal courts, and arbitration versus litigation, he said.

Sovereign immunity can be waived in a limited way that does not put the tribe at risk by limiting it to specific assets, and it can be tied to the dispute resolution clause in the joint agreement under the authority to compel arbitration instead of litigation in state courts.

Giving up sovereignty would be like giving up the right to vote, both constituting a “very sacred principle,” he said, but a limited waiver may be acceptable.

Business development is a long-term strategy, and successful ventures, no matter how large or small, require efficient business structures and “enforceable, fair and balanced contracts,” he said.

The ventures also need “standardized and fair regulatory processes administered by reliable, stable and transparent government authorities.

“Once a level playing field is established, these three elements can foster a wide variety of economic opportunities.”

Tribal objectives include strengthening sovereignty, protecting tribal assets, and expanding tribal employment and contracting, including tribal preference.

The objectives include “enhanced tribal capacity for conducting business, attracting investment, and planning options for future economic development,” said MacCourt, of Ater Wynne LLP and chair of the executive committee, Indian Law Section, Oregon State Bar Association.

“Every successful venture requires a team coordinated by the tribe. The team must have financial, legal, political and public relations experience.”

Those who were invited to address the conference included officials from tribal nations, the Department of Energy, NREL, law firms, the BIA, IHS, and other agencies and organizations.