Procedural Handbook - Leasing And Permitting Chapter 1 - General Information - Department Of The Interior Bureau Of Indian Affairs - 2006 Page 11
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13Leasing and Permitting Chapter 1 – General Information
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2.10 Leasing Of Undivided Fee Interests Policy
Reserved
2.11 Advance Payment Policy
Pursuant to 25 USC § 415 (b) “No rent or other consideration for the use of land leased under
sections 396 and 415 to 415d of this title shall be paid or collected more than one year in
advance, unless so provided in the lease.”
3.0 OTHER CONSIDERATIONS
3.1
Essential Parts of a Lease
Names of the parties - Includes the name of the person(s) or entity owning the land and the
name of the person or other entity that is being granted the right to use the land. The Secretary of
the Interior may act for and on behalf of Indian beneficiaries. The party granting the lease is
called the lessor and the party receiving the lease is called the lessee.
Possession and/or rights conveyed - Describes the possessory right of the lessee and the rights
conveyed. In most cases, the following words are used: “… the lessor hereby leases to the lessee
…”
Land description – In many cases, the leased premise is described by not only the legal
description, but by the tract or allotment number as well. Real estate can be described in several
ways; (e.g. by aliquot parts of the section, range and township; by metes and bounds; by
reference to plat, lot number or map; or by giving the street address in the case of urban
property). (See
Exhibit 5 - How to Read a Land
Description.)
The terms and duration - This clause provides the effective date, the length of the term and the
ending date. For leases on trust land, the duration of the lease is regulated by various statues and
regulations and may vary from location to location and for the type of lease involved.
The rental rates, payment, compensation - Specifies the amount of rent to be paid to the lessor
and the times and method of payment.
Provisions and stipulations - Consists of a series of provisions that cover such things as
maintenance and improvement of the premises; limitations on use; default actions; late payment
penalties, insurance and bonding requirements, conservation stipulations, when assignment and
modification can be performed with or without landowner consent as agreed upon, and other
such provisions required by statute or regulation. Provisions are discussed further in Section 4.0
and the Exhibits Section of this handbook.
Signature, acknowledgements, and the date of the agreement - Most Indian trust leases must
be authorized by the Secretary of the Interior or by his/her duly authorized representative. The
lessee must sign the lease or the signature must be by a person authorized to act on behalf of
another or an entity. The person may be required to furnish documents that verify the authority
of the party to act, such as a resolution of the Board of Directors empowering the agent to sign
on behalf of a corporation or a power of attorney prepared in accordance with state law.
Issued: March 6, 2006
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