Posted by Tierra Marks.

Barnhouse Keegan Solimon & West LLP (“BKSW”) is pleased to announce that Jesse Heibel has joined the firm as an associate attorney.

Jesse is a graduate of the University of Nebraska at Omaha and University of Colorado Law School in Boulder, Colorado.  Jesse began his career in Colorado where he worked both as an attorney for a national Indian law firm and as an attorney for a major research center focusing on natural resources, energy, and the environmental issues in the western United States.  In these roles, Jesse gained years of experience representing tribal clients in all areas of Indian law, including civil litigation; water law; energy law; health law; and commercial, tax, and employment law.

Through Indian Law, Jesse can pursue his goals of using the law to make a tangible difference in people’s lives.  Jesse enjoys representing tribal sovereign governments and practicing Indian law because it touches every imaginable area of the law.  This not only makes each day interesting but helps meet the unique demands and legal issues of tribal clients.

BKSW is excited for Jesse to join its team.  In addition to Jesse’s comprehensive knowledge of the law, he has also made impressive written contributions in Indian law, including his 2018 co-authored publication in the University of Colorado Law Review, Standing Rock, the Sioux Treaties, and the Limits of the Supremacy Clause.  When asked what he likes about writing, Jesse says: “it is a process of self-examination that can always be improved upon.  Whether its persuasiveness, use of citations, or just general grammar, there are always ways in which an attorney can develop their legal writing skills to become a more effective advocate for their clients.”  BKSW could not agree more.

While not necessarily new to Albuquerque, this is the first time Jesse has lived in Albuquerque.  While Jesse loves New Mexico green chile, he is also a big fan of red chile.  Jesse enjoys hiking, biking, and being outdoors as well as preparing new recipes for his partner Hannah.  Although apprehensive, he also likes watching for tarantulas that migrate in the northern Albuquerque area, including through his house, during the fall for their mating season.

Welcome to the BKSW team Jesse Heibel!

Posted by: Sean Balkin, Randolph Barnhouse, Kelli Keegan,
John Koeppel, Lee Redeye and Michael Rossetti.

Prior to the COVID-19 Pandemic, as a result of successes in economic investments in gaming, hospitality and other industries, Native American tribes had seen significant increases in revenues over the last several years.  Unfortunately, in addition to the significant social and cultural burdens shouldered by tribes as a result of the COVID-19 pandemic, it has caused significant negative financial impacts across the hospitality sector, driving down the very revenues that fund services to tribal members.

While this is certainly an unfortunate turn of events in the short term, it has given many tribes an opportunity to re-evaluate their investment strategies to ensure that economic development does not hinge upon the health of a single sector.  Many tribes are evaluating the benefit of diversifying and expanding (or in certain cases, beginning) the holding of alternative investments, including private equity funds, venture capital funds, and other direct investment opportunities.  This article discusses three key investment approaches for tribes.

1. Indirect Investments

One alternative investment option for tribes is to make indirect investments in buyout, venture capital, real estate, and other investments funds. This passive style of investing can offer the tribe a chance to diversify its investment portfolio (and ultimately revenue streams) while relying on the industry-specific investment knowledge of fund managers.  One example of an indirect investment is the Native American Venture Fund, which invests capital from tribes and other investors in areas such as free trade zones, opportunity zones, logistics, pharmaceuticals, cannabis, and carbon credits.  From the tribe’s perspective, the threshold necessary to make these investments is relatively low – the tribe must simply have assets sufficient to qualify to make the investment and it must be able to feel comfortable evaluating the underlying economics of the investment (which, in addition to independent evaluation, in many cases, can be determined by looking at the track record of the fund with which the tribe is investing).  The downside is that the tribe will be a passive investor and, as a result, will have limited (if any) control over the specific investments made by the fund outside protections in the fund’s operating documents limiting the scope of potential investments.  When evaluating this sort of alternative investment, it is helpful to engage sophisticated advisors to assist the tribe in drafting investment guidelines and ensuring that the investment documents provided are on market terms.

2. Co-Investments

A second alternative for tribes is to act as co-investors alongside a traditional investment firm in a specific deal or transaction.  To do so, a tribe should first identify the types of deals in which it wants to participate – whether commercial real estate, hospitality, clean energy, or some other type of investment.  Once it has done so, the tribe should be able to identify specific investment firms willing to co-invest in one-off deals alongside the tribe.  The benefit to the tribe in this sort of transaction is that it can get a direct piece of the action (and likely an increased slice of the upside) for bringing in a large chunk of capital, while also partnering with a firm with industry-specific knowledge.  One option in this vein may be to partner with a boutique independent sponsor style private equity firm to purchase a controlling stake in an operating business, with a plan to grow and sell the business in a three-to-five year window.  Independent sponsors are often excellent partners with access to transactions or deals in industries in which they have extensive experience and operational ability, but that need a capital partner to close the deal.

In evaluating this style of investment, and in addition to considering the underlying fundamental economics of any particular deal, it is crucial that the tribe as co-investor pay careful attention to the documentation of both its partnership with its co-investor, as well as any investment or purchase and sale documents related to the underlying investment.  These documents will not only determine how the economics of the deal will be split, but will also address crucial operational issues like how decisions will be made at investee companies and how the tribe’s interest in the investment can be transferred or liquidated.

3. Direct Investments

Finally, tribes may choose to make direct investments by purchasing commercial real estate, forming a business, or acquiring an existing business on its own.  Many tribes already are experienced in this type of investment through formation of their own Section 17 corporations or wholly owned tribal business entities (e.g., gas stations, convenience stores, or casinos).  This form of investment can require meaningful infrastructure and upfront time-and-money investments from the tribe including commitment of resources to handle deal sourcing, valuation models, building operations teams, and developing industry expertise.  But this type of investment also may offer the highest potential upside as the tribe will own, and control, the entirety of the business in which it is making its investment.  In considering this style of investment, a tribe is fully in the driver’s seat and may wish to partner with sophisticated advisors to assist with conducting due diligence on any target investment to identify material legal and other issues with the target, structuring the initial acquisition (including evaluating forms of consideration or purchase price), and negotiating the key legal terms of the transaction (such as indemnification, representations and warranties, and closing conditions).

In evaluating the investment options above, it is important to note that each option has the benefit of increasing the diversity of the investing tribe’s portfolio – ideally creating a well balanced and healthy financial picture.  The ultimate question for tribal leaders is “what is right for our tribe” and which includes the need for balancing potential upside against how involved the tribe wants to be in the “cradle to grave” investment process.  Investments may also provide important non-monetary benefits to tribal governments.  Tribes can use the revenues derived from their investments to consolidate off-reservation land holdings, strengthen culture and tradition, and protect tribal intellectual property through use.  Investment revenues, or the investment itself, can also be utilized to protect and/or preserve a tribe’s natural resources.  In short, tribal investments can provide a range of benefits that go beyond simply generating revenue.

For more information on investment options or any other Native American tribal matter, please contact any of the attorneys below. This article was written in collaboration with Lippes Mathias and Barnhouse Keegan Solimon & West LLP.

Related Team:

Sean Balkin
Senior Associate
Lippes Mathias
716.853.5100 x1264

Randolph Barnhouse
Partner
Barnhouse Keegan
Solimon & West LLP
505.842.6123

Kelli Keegan
Managing Partner
Barnhouse Keegan
Solimon & West LLP
505.842.6123

John Koeppel
Partner
Lippes Mathias
716.262.9330

Lee Redeye
Associate
Lippes Mathias
716.853.5100 x1382

Michael Rossetti
Partner
Lippes Mathias
202.888.7610 x1601

Posted by Cole Bauman.

On March 15, 2021, the United States Senate voted to confirm Debra Haaland, a 35th generation New Mexican and enrolled citizen of the Pueblo of Laguna, as the 54th United States Secretary of the Interior.

The vote concluded with 51 Senators “for” and 40 “against” with support not only from Democratic Senators, but also from Republican Senators Susan Collins, Lisa Murkowski, Dan Sullivan and Lindsey Graham.

Secretary Haaland is the first Native American to serve as Secretary of the Interior, an institution formed 172 years ago in 1849.  Her confirmation is further remarkable in that Secretary Haaland serves now as the first Native American Cabinet secretary in the history of the United States.

Where once there had never been a representative of Indian country, now stands Crushed Turquoise in a position to serve all Americans.

*“Crushed Turquoise” – Congresswoman Deb Haaland Captured in Wet Plate Collodion by Shane Balkowitsch.  Secretary Haaland has explained that “Crushed Turquoise” is her traditional name translated from the Keres language.

During her tenure, Secretary Haaland will be asked to pave a difficult path.  When she served in the House of Representatives, then-Representative Haaland was recognized as a progressive force.  In early 2020, she sponsored H.Res. 835, a bill that, were it to have become law, would have set the country on a path to protecting and conserving 30% of its land and 30% of its oceans by 2030.  As a member of President Biden’s Cabinet, though, Secretary Haaland has committed to find ways to work cooperatively with all members of Congress to balance America’s energy interests, including fossil fuels.

However difficult the road ahead may be in overseeing this country’s public lands, natural resources, and various bureaus within the Department of the Interior, including the Bureau of Indian Affairs and the Bureau of Indian Education, Secretary Haaland will bring a new perspective and new solutions.  During her first day on the job, Secretary Haaland explained:

we must engage tribal nations with an all-of-agency approach because for far too long, Indian issues were relegated to just the Indian Affairs bureaus. If we’re going to make sure that tribal communities thrive, that tribal sovereignty is respected and strengthened, and if we are truly to repair our nation-to nation-relationships, then that means every bureau and every office needs to be thinking about our obligations to Indian tribes across the country

Secretary Haaland’s historic confirmation has changed the landscape of the Department of the Interior, and she has “hit the ground running” in her new role.  We congratulate Secretary Haaland on her confirmation!

Posted by Michelle Miano.

In a year defined by hardship, there is cause for celebration.  This month, president-elect Joe Biden nominated Rep. Deb Haaland (D-NM), one of two Native American women currently serving in the U.S. House of Representatives, to the position of Secretary of Interior.  Once confirmed, Rep. Haaland, an enrolled member of the Pueblo of Laguna, will not only be the first Native American to hold that position, but will also be the first Native American in the history of the country to serve in a presidential Cabinet-level position.

As Rep. Haaland stated:

A voice like mine has never been a Cabinet secretary or at the head of the Department of Interior.  Growing up in my mother’s Pueblo household made me fierce.  I’ll be fierce for all of us, our planet, and all of our protected land.  I am honored and ready to serve.

Secretary of Interior designate Haaland will oversee the 70,000-person U.S. Department of Interior, which includes the Bureau of Indian of Affairs, the Bureau of Indian Education, the Bureau of Land Management, the Bureau of Ocean Energy Management, the Bureau of Reclamation, the Bureau of Safety and Environmental Enforcement, the Bureau of Trust Funds Administration, the National Park Service, the Office of Surface Mining Reclamation and Enforcement, the U.S. Fish and Wildlife Service, the U.S. Geological Survey, and a number of other offices, including the Office of the Solicitor.

We all look forward to the leadership that Secretary of Interior designate Haaland will bring to the Department of Interior.  BKSW has decades of experience working with the Department, including land into trust matters, rights-of-way, land leases, Indian water rights and natural resource issues, and representing clients before the Department’s administrative agencies.  We appreciate how important good Department leadership is.  Congratulations to Secretary of Interior designate Haaland for this historic and well-deserved nomination!

Photo courtesy of debforcongress.com