FROM THE ARCHIVE
Trust fund decision blasted
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JANUARY 25, 2001

The plaintiffs in the billion-dollar trust fund lawsuit against the government on Wednesday criticized one of the final actions of Bruce Babbitt, the now-departed Secretary of Interior.

Saying it will waste up to $70 million in taxpayer funds, the group said Babbitt's plan to conduct a sampling of an estimated 300,000 Individual Indian Money (IIM) accounts has little chance of fixing the historically mismanaged system. Babbitt issued a memorandum to conduct a statistical analysis on December 29, 2000, about two weeks before he left office.

"This is another desperate effort to distract the Courts and Congress from their utter inability to complete a full and accurate accounting, as required by law,” said Elouise Cobell, a Blackfeet Nation of Montana banker and lead plaintiff. "I certainly hope the Bush Administration can get control of the Justice Department, obey the law and the federal judge's orders and start to restore some integrity to this disgrace."

If Republican lawmakers get their wish, Cobell might soon get hers should the full Senate confirm Gale Norton to head the Department of Interior. The Senate Committee on Energy and Natural Resources yesterday voted to approve her nomination and during her testimony last week, the former Colorado Attorney General said would work to see the issue resolved "at some point in the future."

"It's alarming to hear that we have such large amounts of money that ought to belong to the Indian people themselves that has become lost somewhere in the bureaucracy of the Department of the Interior," said Norton. "And I will do what I can to work to straighten that out."

In the meantime, Cobell and the other plaintiffs are opposing Babbitt's recent action. Although the government doesn't know how long such a project would take and has acknowledged that the overwhelming majority of account holders who participated in public hearings last year want a transaction-by-transaction report, the Interior decided to conduct a statistical analysis because of money, time, and staff restraints.

In a memorandum, former Assistant Secretary Kevin Gover last month said Congress would need to double its $27.6 million trust reform budget and the BIA would need to "significantly" increase its staff dedicated to the issue. Gover also noted a transaction-by-transaction report would cost hundreds of millions of dollars the Interior doesn't have.

Still, the Interior doesn't know how much their sampling plan would cost. The Special Trustee for American Indians, the office charged with trust responsibilities, has only come up with "rough" estimates.

The office estimates it would sample just 350 accounts, only about 0.01 percent of the estimated 300,000 accounts. It could cost between $50,000 to $200,000 per account, leading to a total cost of anywhere between $17.5 million and $70 million to carry out Babbitt's decision.

Charging it has a mandate from Congress through the American Indian Trust Fund Management Reform Act of 1994, the office is also limiting its sample to the time period from 1952 to 1993. Although the government says the General Accounting Office (GAO) has settled the accounts prior to that date, Cobell and the other plaintiffs said such a decision is "arbitrary" and that a court ruling requires them to account for funds dating back to 1887.

Read Recent Documents on the Sampling Plan:
Babbitt, Gover, Office of Special Trust Memorandums [PDF]

Relevant Links:
The Department of Interior - www.doi.gov
Trust Management Improvement Project, BIA - www.doi.gov/bia/trust/tmip.htm
Indian Trust: Cobell v. Babbitt - www.indiantrust.org

Only on Indianz.Com:
The Trust Fund Fiasco (Smoke Signals 1999)

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Records a continued source of problems in lawsuit (Tribal Law 1/18)
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Trust documents reported destroyed (1/17)
Trust fund battle heats up (Tribal Law 12/04)
Report: Trust fund settlement killed (Tribal Law 11/20)
Treasury wants report kept secret (Tribal Law 11/03)
Congress wants settlement of trust suit (Money Matters 10/27)
US: Trust reform project behind schedule (Tribal Law 09/19)
Trust fund case back in court (Tribal Law 09/05)
COMMENTARY: The Trust Fund (The Talking Circle 09/07)
Trust fund update (Tribal Law 08/07)

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