Historic water rights settlement for Tule River Tribe advances

• S. 689 secures 5,828 acre-feet of water annually for the Tule River Tribe.
• The bill establishes a $695 million trust fund, expected to grow with interest.
• Ownership of the fund will transfer to the tribe once settlement terms are met.
• Federal land—over 11,000 acres—will be added to the Tule River Reservation.
• Estimated cost to taxpayers totals $902 million over 10 years.

Wednesday, May 28, 2025 — A recently released Congressional Budget Office (CBO) report evaluates the fiscal impact of the Tule River Tribe Reserved Water Rights Settlement Act of 2025 (S. 689), a long-awaited effort to resolve the Tule River Tribe’s claims to water in California’s Tulare County. The bill, as reported by the Senate Committee on Indian Affairs on May 12, will formally recognize a 2007 agreement among the Tule River Tribe, the Tule River Association, and the South Tule Independent Ditch Company.

The legislation will authorize up to 5,828 acre-feet of water annually for the tribe and create the Tule River Indian Tribe Settlement Trust Fund to support water development and maintenance projects.

Funding and Federal Commitment.

The bill will appropriate $695 million to the trust fund, including $568 million for water infrastructure and $127 million to account for inflation since 2020. According to CBO, “the tribe would have immediate access to $20 million from the trust fund to complete technical studies for future water infrastructure projects.”

While the Department of the Interior will initially oversee the fund, full ownership, including accrued interest estimated at $207 million, will transfer to the tribe around 2033, assuming that legal conditions and required approvals are satisfied. The total cost to the federal government, including interest, is projected to be $902 million over the 2025–2035 period.

Land Transfer and Environmental Oversight.

Beyond water rights, S. 689 authorizes the transfer of 11,640 acres of federal and tribal land to be held in trust for the Tule River Reservation. This includes more than 9,000 acres from the U.S. Forest Service, 765 acres from the Bureau of Land Management, and 1,837 acres already owned by the tribe.

The report notes a minimal fiscal impact from the loss of federal grazing fees on Forest Service land, and spending related to environmental oversight and land transfer is expected to total $1 million over five years.

Mandates and Limitations.

The bill includes several intergovernmental mandates. The Tule River Tribe will be required to waive certain legal claims related to past water losses and is prohibited from permanently selling or gifting its water rights. Additionally, Tulare County and other local jurisdictions will lose approximately $100,000 per year in tax revenue from land converted to federal trust status.

The cost of the legal claim waivers cannot be precisely estimated. CBO was unable to determine whether the overall mandates would exceed the annual threshold set by the Unfunded Mandates Reform Act.

Effect on Budget.

CBO concluded that “enacting S. 689 would not significantly increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2036.” However, statutory pay-as-you-go procedures do apply, and federal expenditures related to this settlement are expected to peak around the time the trust fund is transferred to the tribe in 2033.

For more details, the full CBO report is available at: https://www.cbo.gov/publication/61428

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