Due to the U.S. Supreme Court’s McGirt ruling, federal officials have informed state agencies that control and oversight of mining and various environmental regulations in eastern Oklahoma are now the domain of the federal government.

That shift is expected to have significant economic consequences for businesses previously regulated by state authorities.

In a release issued this month, the U.S. Department of the Interior’s Office of Surface Mining Reclamation and Enforcement (OSMRE) notified the Oklahoma Department of Mines and the Oklahoma Conservation Commission that because of the McGirt decision “the State may no longer exercise regulatory jurisdiction under the Surface Mining Control and Reclamation Act of 1977 (SMCRA) on Indian Lands within the State.”

The federal agency announced it is working with the Oklahoma state government and the Muscogee (Creek) Nation to provide an “orderly transition of SMCRA responsibilities on the Muscogee (Creek) Reservation to OSMRE.”

In McGirt v. Oklahoma, the U.S. Supreme Court held that the Muscogee (Creek) Nation’s reservation was never disestablished. While the ruling applied only to Creek land and questions of criminal prosecution under the federal Major Crimes Act, its precedent and basis are expected to result in application to numerous other issues, such as taxation and regulation, and also include the land of at least four other tribes—the Choctaw, Chickasaw, Cherokee, and Seminole nations—whose combined territory includes most of eastern Oklahoma. Subsequent court rulings have steadily expanded the decision’s reach as expected.

The full impact of federalized control of much of eastern Oklahoma is not yet fully understood, but reports issued by state agencies last year provide educated predictions on how the McGirt decision could impact the state. Those reports, issued in response to a fact-finding effort launched by Gov. Kevin Stitt, warned of significant disruption to the lives and livelihoods of citizens living in eastern Oklahoma.

The McGirt report issued by the Oklahoma Department of Mines, obtained by the Oklahoma Council of Public Affairs through an open-records request, was substantially redacted due to exemptions allowed by that law.

The redacted sections included potential McGirt fallout for the agency regarding entities “engaging in (non-coal) mining without a permit,” “challenges to state jurisdiction to regulate groundwater use and groundwater quality,” “enforcement of ODM rules and regulations on active mines,” “investigation of complaints and inspection of active mine sites by ODM inspectors,” the “ability of state courts to determine ownership or enforce ODM legal actions,” and “non-mining blasting.”

The non-redacted portions of the Oklahoma Department of Mines report noted that efforts to shift regulation away from the state could be prompted by a desire by some entities to avoid complying with state regulations at one extreme or by efforts to “impose more restrictive regulations or to discourage others from engaging in mining” at the other extreme. If the latter motive is involved, the report noted that “frustration of mining operations could lead to substantial economic harm to individuals and to the State as a whole.”

According to the Oklahoma Department of Mines’ website, there were four coal companies operating seven mines in five Oklahoma counties (Craig, Latimer, LeFlore, Okmulgee, and Rogers counties) in 2017, the most recent year for which data was posted.

Other mining regulated by the agency includes limestone, dimensional stone, sand and gravel, gypsum, clay and shale, granite, caliche, tripoli, salt, iron ore, and chat. As of January 2018, there were 739 non-coal sites permitted with the Department of Mines, although the agency notes that number “is constantly changing as new permits and permit revisions are received on a daily basis from the industry as well as companies applying for bond releases.”

In its McGirt report, issued on July 22, 2020, the Oklahoma Conservation Commission predicted that the “McGirt Worst Case Scenario” for the agency could include elimination “of 40 conservation districts thus impacting landowners and producers, conservation and water quality programs, and approximately 1,000 flood control structures.”

The Oklahoma Conservation Commission’s tasks include efforts to reduce water pollution for which the agency receives federal funding. The commission warned that those federal grants may soon be “spread to other states, or be split amongst the national tribes.”

“Either way, fewer dollars would reach within the traditional boundaries of Oklahoma to assist landowners with protecting natural resources through voluntary programs,” the Oklahoma Conservation Commission report noted.

The Oklahoma Conservation Commission also administers a state program to help improve water quality and control soil erosion and is responsible for prioritization and management of nonpoint source pollution through a federal/state cost-share program.

Post-McGirt, the commission warned, “For the 40 counties located in the Indian Reservations per McGirt, these cost-share programs’ state funds would no longer be available to landowners and producers thus impacting soil and water conservation for these counties until the tribes could establish and fund such programs themselves.”

Oklahoma also has 2,107 upstream flood control dams. The agency reported that there are 129 watershed projects in 64 counties with dams in 121 watersheds in 61 counties providing $81 million in annual estimated benefits from reduced flood damages and other benefits.

Due to McGirt, the Oklahoma Conservation Commission warned that the “operation, maintenance, and inspection of approximately 1,000 of the flood control dams located in 33 counties” may now fall outside of state authority.