Interior Secretary Gale Norton:
10 years and at least $2.4 billion to account for Indian Money

ROBERT GEHRKE / AP 3jul02

WASHINGTON -- It will take 10 years and at least $2.4 billion to sort out more than a century's worth of transactions from a mismanaged trust fund system handling royalties from Indian-owned land, Interior Department officials said Wednesday.

The cost is six times more than what Interior Secretary Gale Norton told Congress in February it would be. The new figure is likely to get a cool reception from a cash-strapped Congress.

The department's plan offers "a full accounting, a robust transaction-by-transaction analysis ... and we fully anticipate there will be some commentary or other direction by Congress," Interior spokesman Eric Ruff said.

The expense reflects the enormous task of accounting for every cent of an estimated $13 billion that has passed through as many as 500,000 individual trust accounts between 1887 and 2000, agency officials said.

The process includes reviewing 25 million electronic transactions and 500 million paper records, many deteriorating and damaged by time.

The trust fund stems from Congress' decision in 1887 to designate small allotments of land to individual Indians and assign the Interior Department to manage the grazing, timber and oil and gas rights.

But the money was poorly managed and an unknown amount was stolen, misappropriated or never collected.

In 1994, Congress ordered the department to account for the Indian money. Five years later, U.S. District Judge Royce Lamberth, presiding in a class action lawsuit, said the accounting must be a transaction-by-transaction reconciliation dating back to the origination of the accounts.

Plaintiffs in the case say Interior Department mismanagement has cost the Indian accountholders at least $10 billion and possibly several times that amount, but no thorough accounting has been done.

A decision is awaited from Lamberth on whether to hold Norton in contempt for failing to comply with his order to conduct an accounting and for misrepresenting progress on the project.

Ruff said the new report -- which includes a margin of error that could allow the cost to reach $3 billion -- represents the department's best estimate for how much it would cost to do that accounting.

The rising dollar figure is not expected to be received well by Congress. Last year, House appropriators suggested Congress "may have to consider a legislative remedy" if the department could not find a cost-effective way to handle the accounting.

The department's annual budget -- including operation of 385 national parks and recreation sites and management of 451 million acres of federal land -- is $10.6 billion.

Interior officials said they are implementing the plan with money they received in the current budget year and have balanced more than 8,000 of the 500,000 accounts.

Dennis Gingold, attorney for the Indian plaintiffs, said the report assumes all the data in the department's electronic systems are correct while also stating there likely are errors.

"You can't take these people seriously if they're assuming the data in the system is accurate," he said.

• Interior Department Indian trust site: www.doi.gov/indiantrust
• Indian plaintiffs: www.indiantrust.com