Lease / Permit Bond - Bureau of Indian Affairs in All States
Table of Contents
Brief Summary
BIA does not set one bond amount for leases on Indian land. Your figure is built from your lease: at least a year's rent plus improvements, irrigation charges and reclamation. Once you have that number from the lease or the BIA realty office, a surety bond lets you post it without locking up cash or a CD for the whole term.
The Bureau of Indian Affairs requires a performance bond or other security from tenants on agricultural, business and wind and solar leases of Indian trust or restricted land, and from permittees on grazing permits, under 25 CFR parts 162 and 166. The amount is set lease by lease and must cover at least one year's rent plus required improvements, operation and maintenance charges and restoration. A surety bond must come from a company approved by the U.S. Treasury.
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How to Apply for a Lease / Permit Bond:
- Get the bond amount from the lease or the BIA or tribal realty office with jurisdiction over the land.
- Have the lease or permit number, the land description and the lessee's legal name exactly as shown on the lease.
- Complete the bond application with personal and business credit information.
- Provide financial statements if the bond covers large improvements or reclamation.
- Execute the bond naming the Bureau of Indian Affairs, or the tribe if the lease allows, as obligee.
- Deliver the bond to the BIA or tribal realty office and keep it in force for the lease term.
Detailed Information About the All States Lease / Permit Bond:
How the amount is set
There is no flat bond amount. For business leases (25 CFR 162.434) and wind and solar resource leases (25 CFR 162.559) the security must be no less than the highest annual rental in the lease, or another amount BIA sets with the tribe or landowners if rent is not paid annually. It must also cover construction of required improvements, operation and maintenance charges for land inside an irrigation project, and restoration of the premises. Agricultural leases (25 CFR 162.234) are secured for one year's rental, required improvements, other lease obligations and reclamation. Grazing permits under 25 CFR 166.601 follow the same pattern, based on one year's grazing rental, improvements, other obligations and reclamation. The lease itself spells out when BIA can adjust the amount.
Who is exempt
Residential leases and wind energy evaluation leases do not need a bond under 25 CFR 162.334 and 162.525. BIA may waive the bond on a business or WSR lease when the lease is for religious, educational, recreational, cultural or other public purposes, or when the Indian landowners request it and BIA finds the waiver in their interest. On agricultural leases the bond can be waived at the request of owners of a majority interest, or a tribe can set its own rule. Grazing permit bonds can be waived on request of an Indian landowner. Tribes with approved HEARTH Act regulations may run their own leasing rules for tribal land.
Permits for use of Indian land do not need BIA approval under 25 CFR 162.007, but they must be submitted to the BIA office for its records. If BIA decides the document grants a legal interest in the land, a lease is required instead.
Obligee and form
The bond is deposited with and payable to BIA, and cannot be modified without BIA approval. For tribal land, the lease may allow the bond to be deposited with and payable to the tribe. Surety bonds must be issued by a company approved by the U.S. Department of the Treasury. On business and WSR leases the bond must require the surety to give BIA at least 60 days notice before cancelling, and failing to replace it is a lease violation. BIA may ask the surety for documents showing the bond is enforceable. Confirm the bond form and filing steps with the BIA or tribal realty office that handles your lease.
Release
When the lease ends, the lessee asks BIA in writing to release the bond. BIA checks with the tribe or landowners that all obligations were met before releasing it.
Cost
The premium depends on the bond amount, the length of the lease, the improvements and reclamation it covers, and the principal's credit and financial strength.
Eligibility and Requirements for an All States Lease / Permit Bond:
- Surety company approved by the U.S. Department of the Treasury.
- Amount at least equal to the highest annual rental plus improvements, irrigation charges and reclamation as the lease provides.
- Bond payable only to BIA, or to the tribe for tribal land when the lease says so.
- At least 60 days written notice to BIA before the surety cancels on business and WSR leases.
- No modification or withdrawal without BIA approval.
- Replacement security if BIA draws on the bond for a violation.
All States Lease / Permit Bond FAQs:
It depends on your lease. The minimum is generally one year's rent, plus the cost of required improvements, irrigation operation and maintenance charges, and restoring the land. The lease or the BIA realty office will give you the figure.
No. 25 CFR 162.334 says BIA will not require a performance bond for a residential lease. Wind energy evaluation leases are also exempt.
Yes, in many cases. Business and WSR lease bonds can be waived at the landowners' request if BIA agrees it is in their interest, or for public purpose leases. Agricultural lease bonds can be waived at the request of a majority interest. Grazing permit bonds can be waived on an Indian landowner's request.
Not for business or WSR leases, where 25 CFR 162.435 bars cash bonds. Agricultural leases and grazing permits do allow cash. A Treasury approved surety bond is accepted on all of them.
After the lease expires or ends, send BIA a written request. BIA confirms with the tribe or landowners that you met all lease obligations and then releases the bond.
