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McCain and Dorgan introduce trust reform legislation
Thursday, July 21, 2005

Sens. John McCain (R-Arizona) and Byron Dorgan (D-North Dakota), the chairman and vice chairman of the Senate Indian Affairs Committee introduced a comprehensive trust reform bill on Wednesday. Here is a title by title explanation of S.1439, the Indian Trust Reform Act of 2005.

Title I
This section would provide a mechanism to settle the Cobell v. Norton trust fund lawsuit. It doesn't provide a dollar amount but says the settlement fund would be distributed by the Department of Treasury and a Special Master, appointed by Treasury.

The fund will be distributed in two ways. First, a portion would be distributed equally to every Individual Indian Money (IIM) beneficiary. Then, each account holder would receive money based on the type of activity that occurred on his or her land.

A portion of the fund would also be used for attorneys fees, administrating the settlement and for successful court challenges by individual Indians who dispute their settlement amounts.

Title II
This section creates an Indian Trust Asset Management Policy Review Commission of 12 members to review all current trust resource management laws and the Interior Department's trust resource management practices. The commission would then submit a report to Congress with recommendations for improving trust asset management.

Title III
This section creates an eight-year Indian Trust Resource Management Demonstration Project. Tribes would be able to negotiate their own management plans with the Interior Department in accordance with the federal trust responsibility and certain standards.

Title IV
This section allows the Interior Department "to offer more than fair market value" for fractional interests. It allows the department to "settle any and all mismanagement claims" associated with the land. However, the settlement is not mandatory.

This section also allows the department to make offers for "extremely fractionated land" parcels through the mail. If a landowner doesn't respond within 90 days, the offer will be deemed accepted.

Title V
This section creates a new Under Secretary for Indian Affairs at the Interior Department. The under secretary would assume control over the Bureau of Indian Affairs and the Office of the Special Trustee for American Indians. But OST would be "abolished" by December 31, 2008, and a new Office of Trust Reform Implementation and Oversight would be created.

The section makes sure that Indian preference will apply to the new under secretary's office.

Title VI
This section requires the Government Accountability Office to perform a yearly audit of the Individual Indian Money (IIM) trust and each individual tribal trust account.

McCain's statement to the Senate floor cited the "regrettable" management of the Indian trust. He said the Cobell case, filed in 1996, has shown "that the United States has not lived up to its duty as a fiduciary to the thousands of Indian beneficiaries of IIM accounts."

In his statement, Dorgan said the bill is not "perfect." "Rather, it is intended to be a starting point for substantive and productive dialogue between the parties," he said.

Tex Hall, the president of the National Congress of American Indians, said the bill "needs to go further." "There is an old saying amongst the elders in Hidatsa Country," he said. "It goes like this, 'Show me the money!' Today, all of Indian Country is asking the same question, 'where is the money?'"

Hall is scheduled to testify before the Senate committee's hearing on the bill next Tuesday, July 26.

Senate Documents:
John McCain Statement | Byron Dorgan Statement | Full Text of Bill as Introduced

Relevant Documents:
Trust Reform and Cobell Settlement Workgroup Principles for Legislation (June 2005)

Related Story:
Federal official: Native trust fund accounts vulnerable (The Lincoln Journal Star 7/21)

Relevant Links:
Indian Trust: Cobell v. Norton - http://www.indiantrust.com
Cobell v. Norton, Department of Justice - http://www.usdoj.gov/civil/cases/cobell/index.htm
National Congress of American Indians - http://www.ncai.org
Intertribal Trust Fund Monitoring Association - http://www.itmatrustfunds.org

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