Does the legal structure of Native American land holdings limit economic opportunities?

Thursday, December 3, 2020
By Christopher Hutton

On Native American reservations, 95% of the land is held in tribal or individual trust, meaning that while tribes and individuals are granted "beneficial interest" in the land the U.S. government retains legal title. As a result, Native Americans cannot buy or sell trust land, nor borrow against it. The structure dates back to Supreme Court decisions in the 1830s.

The 20% of the trust land held in individual trust is divided among an individual's heirs once they pass away. Over time, this land is split among many descendants, leading to "fractionation." The Interior Department says that "creates jurisdictional challenges and ties up land within the reservation boundaries, making it difficult to pursue economic development and infrastructure projects." A March 2020 study found that "fractionation suppressed long-run income generation from mid-quality land."

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