Fredericks Peebles & Morgan LLP
Advertise:   712.224.5420

Norton lobbies Congress on trust fund accounting

Interior Secretary Gale Norton urged Congress on Thursday to get involved in the battle over an historical accounting that the Bush administration is taking to a federal appeals court.

In testimony before a Senate Appropriations subcommittee, Norton sounded a warning about an injunction reinstated by U.S. District Judge Royce Lamberth last month. She said the court ordered the department to undertake a costly accounting of the Individual Indian Money (IIM) trust.

"This order requires us to back to 1887 to verify every single transaction since that time," Norton said.

Norton said the effort will require the federal government to subpoena and compile records from oil and gas companies, individual Indians and tribal governments. "The department has estimated that the total cost of this accounting work will be $10 to $12 billion," she testified.

Norton did not suggest a course of action for the lawmakers at the hearing, who appeared more interested in cuts for tribal colleges and construction of Bureau of Indian Affairs schools than the trust. Only one lawmaker, Sen. Conrad Burns (R-Montana), the chairman of the subcommittee, brought up the issue when he said the government was "pouring money down a black hole."

"Between you and judges and everything else, it's got most of us up here on the Hill sort of confused," he said of the $135 million request, an increase of $78 million, for ongoing accounting activities.

But Norton's decision to lead off her testimony with a lengthy statement about the court order signaled the Bush administration's stance on the issue. The Department of Justice filed an emergency motion to stay Lamberth's ruling pending an appeal.

Hours after Norton finished her testimony, the D.C. Circuit Court of Appeals declined to issue the stay. Instead, the court asked the Cobell plaintiffs to provide a response by March 17. The Bush administration's final brief is due March 24.

"It appears the Court of Appeals is getting the message: justice delayed is justice denied," lead plaintiff Elouise Cobell said in a statement. "We welcome the opportunity to make our case before the appeals court, and believe that the accounting ordered by the district court will proceed."

The activity sets the stage for another battle on the lawsuit in the halls of Congress. The Senate Indian Affairs Committee and the House Resources Committee are jointly pursuing efforts to settle the case and provide a fix to the system.

Some lawmakers, however, are considering reinstating the "midnight rider" that halted the accounting last year. The Cobell plaintiffs, tribes and a large contingent of House members led by Rep. Richard Pombo (R-California) tried to defeat the rider but were unsuccessful.

The issue was raised earlier this month after Norton brought up Lamberth's order at a hearing of the House Interior Appropriations subcommittee. Over the past three years, Reps. Charles Taylor (R-North Carolina) and Norm Dicks (D-Washington), the chairman and ranking member of the subcommittee, have tried to force a settlement of the Cobell case by inserting language in Interior's appropriations bill.

Interior officials repeatedly denied involvement with the effort but the White House last year supported the midnight rider. And Norton's used it to seek a stay of the original accounting order that Lamberth had issued in September 2003.

The D.C. Circuit eventually set aside Lamberth's order but, as Norton noted yesterday, did not reach the merits of the rider. That led Lamberth to reissue the broad historical accounting injunction late last month.

The Bush administration is currently performing an accounting much more limited in scope. The Office of Historical Trust Accounting is not verifying land holdings, probates or leases and is only examining accounts that were open as of 1994

According to Norton, the effort has shown that errors in individual and tribal accounts are "infrequent and small." Although the project is not complete, she said there have only been $1.5 million in discrepancies on a throughput of more than $15 billion in individual and tribal trust funds.

The Cobell plaintiffs welcome a settlement, Native American Rights Fund attorney Keith Harper said in Senate testimony on Wednesday. But the two sides differ on the potential amount owed to individual Indians -- department officials suggest it would be in the "low millions" rather than billions.

Listen to Testimony on Trust:
MP3: Secretary Gale Norton (1.91 MB)

Court Order:
Cobell v. Norton (March 10, 2005)

Relevant Links:
Indian Trust: Cobell v. Norton -
Cobell v. Norton, Department of Justice -
Indian Trust, Department of Interior -