Mr. McCAIN: Mr. President, as chairman of the Committee on Indian Affairs, I rise today to speak in vigorous support of S.1439, the Indian Trust Reform Act of 2005, a bill I introduced in July 2005,…
Mr. McCAIN: Mr. President, as chairman of the Committee on Indian Affairs, I rise today to speak in vigorous support of S.1439, the Indian Trust Reform Act of 2005, a bill I introduced in July 2005, with Senator Dorgan as an original co-sponsor, to address a broad range of Indian trust asset issues and trust management policies and practices. As introduced, this bill was intended only as a starting point for an extended dialogue with interested parties in Indian country and in the Government that would lead us, eventually, to legislation that brings real and lasting improvements in the way Indian trust assets are managed and that resolves the 10-year old class action lawsuit against the United States known as Cobell v. Kempthorne. I want to begin by extending my thanks and great appreciation to Senator Dorgan, who is vice-chairman of the committee and will soon be its chairman in the 110th Congress, for the extraordinary, tireless effort that he and his staff have made in working on this bill over the course of the past 2 years. In accordance with a long-standing tradition of bipartisanship within the Committee on Indian Affairs, Senator Dorgan and his staff have worked hand-in-hand with me and my staff in our attempt to reform the way in which Indian trust lands and resources are managed and to settle the Cobell lawsuit.
By no means did trust reform begin with this bill. I myself have introduced similar legislation in prior Congresses, including S. 1459 in the 108th Congress; in 2004 the Congress enacted the Indian Probate Reform Act, which brought significant reforms to the laws applicable to the probate of individual Indian trust and restricted land; and 10 years before that the American Indian Trust
Fund Management Reform Act of 1994 was enacted into law, which, among other things, created the Office of the Special Trustee for American Indians. While I truly believe that as a result of these and other enactments, and reform initiatives within the Department of the Interior--in part in response to court orders in the Cobell case--there have been improvements in at least some areas of trust management, we still have a very long way to go before the business of Indian trust reform is complete.
I will not even try to recount here the difficult history of the relationship between the United States and its native peoples. But I am pleased to say that the past 25 years have brought significant advancements in the lives of many Indian people as a result of better access to education, health care and housing, and because of economic development in some parts of Indian Country. However, there are still many unacceptable disparities between conditions in many Indian communities and those of non-Indian communities in this country. S. 1439 represents an attempt to address one particular component that affects the economic well-being of many Indian people: the way in which Indian trust and restricted assets--land, minerals, water, timber, crops, and the revenues derived from these resources--are managed by the United States.
The performance of the United States over the past 125 years in its capacity as trustee and manager of Indian trust and restricted lands is not something to be proud of. The policy of allotting Indian tribal lands, which had become the general Federal Indian policy in the 1880s, was one of several federal ``experiments'' in Indian matters that have had regrettable results both for the Indian tribes and for the Government. This policy of the 19th Century has come back to haunt us now in the form of fractionated ownership of allotted lands--where some parcels of land are owned by dozens, often hundreds and in some cases even over a thousand different individual Indian owners. This fractionation of ownership has led to a proliferation of individual Indian money accounts, ``IIM accounts'', which now number in the hundreds of thousands of separate accounts and many of which have very small balances and annual income, all of which the Federal Government has a trust obligation to track and manage--at considerable expense.
The staggering number of tiny fractionated interests--along with decades of mismanagement on the part of Government officials-- contributed to the conditions that led to the filing of the Cobell class action here in the District of Columbia. A lot has happened in that litigation since it was filed 10 years ago, much of it reported in newspapers across the country, but I think it is fair to say that one thing the case has shown is that the United States has not lived up to its duty as a fiduciary to the thousands of Indian beneficiaries of trust lands and funds.
Between 1993 and 2006, the Committee on Indian Affairs has held at least 17 hearings on the matter of Indian trust reform or reorganization of the Bureau of Indian Affairs. In 1994, Congress passed into law the American Indian Trust Fund Management Reform Act, 25 U.S.C. Sec. 4001, et seq., to reform the management of Indian assets, accounts, and resources held in trust and managed by the United States. The 1994 Act was not the final word on trust reform, even in the limited context of Indian trust funds management. Two years after that Act was passed, a class action based in part on the requirements of the Act was filed in the United States District Court for the District of Columbia: the case of Cobell v. Babbitt--redesignated Cobell v. Norton with the appointment of Gale Norton as Secretary of Interior, and again Cobell v. Kempthorne with the appointment of Dirk Kempthorne as Secretary.
In November 2001, in response to the Cobell litigation, the Department of Interior submitted a reprogramming request to the Senate and House Appropriations Subcommittees on Interior and Related Agencies to establish a new ``Bureau of Indian Trust Asset Management'', BITAM, within the Department to be administered by a new appointed official, an ``Assistant Secretary--Indian Trust Asset Management.''
The BITAM proposal was very poorly received by Indian country, and soon thereafter the Senate Appropriations Subcommittee on Interior and Related Agencies asked the Department to resubmit its reprogramming request at a later date pending further consultation and further review of the management and organization of the Department's trust program.
Over the course of 2002, the Department convened and participated in a series of consultations and other meetings with Tribal officials and representatives across the country to discuss Indian trust asset management and reform. The principal mechanism for this consultation was a ``Joint Tribal Leader/Department of Interior Task Force on Trust Reform'' composed of Tribal leaders from around the country and Department officials. The joint task force reviewed and documented trust asset management functions and processes at all levels within the Bureau, and eventually identified numerous features of the Bureau's trust system and organization that required reform. The joint task force also studied several restructuring proposals developed by Indian tribes around the country.
Ultimately, the joint task force reached an agreement in principle on a restructuring proposal that would create a new position of Under Secretary for Indian Affairs. The Under Secretary would report directly to the Secretary of Interior and have authority over all aspects of Indian affairs within the Department, including the management of tribal and individual Indian trust assets, including both financial and natural resource trust assets. Under this proposal, the Office of the Special Trustee would eventually be phased out. However, although Tribal leaders and Department officials on the task force also reached agreement on other significant matters relating to trust reform and restructuring, they were unable to agree on certain key elements of the legislative proposal. In October of 2002, the joint task force was disbanded.
Mr. President, I wish I could say that our efforts in the 109th Congress bridged all of the gaps between the Government, the tribes and individual Indians, but I cannot. That does not mean that we did not make significant progress. In the course of the past 18 to 20 months all parties have acquired a much better understanding of the issues and of each other's positions. The Committee and its staff have also acquired a better understanding and appreciation of the issues as well. Again, I want to thank Senator Dorgan for his insights, efforts, and commitment of time and staff in this truly bi-partisan effort. The majority and minority staff of the Committee on Indian Affairs met extensively with representatives of Indian tribes, tribal organizations and individual Indian organizations in an effort to get a solid understanding of what Indian country wants to get out of trust reform. The staff of both sides of the committee also met and conferred extensively with various components of the administration and representatives of the plaintiffs in the Cobell case to discuss S. 1439 and the settlement of claims in the lawsuit. I know this outreach and the information it produced will be extremely useful to this body as the Indian trust reform initiative goes forward in the 110th Congress.
One significant outcome of our efforts during this Congress is the fact that the administration made a counter-proposal in October of this year which spells out its views of what should be done to reform the management of Indian trust assets, and I am submitting a summary of that proposal along with this statement. Their proposal has four major components: consolidation of ownership of fractioned tracts within the next 10 years; a transition to beneficiary-managed ownership of trust lands within the next 10 years; resolution of tribal trust claims--in addition to individual Indian trust claims; and some limitations on the liability of the Government for claims that may arise during and after the 10 year transition period to a system of beneficiary management.
Not surprisingly, the reaction of Indian country to the administration's proposal was, for the most part, quite negative. Much of the opposition focused on the timing of the proposal: it
was made with only weeks of legislative days left in our calendar, not nearly enough time to consider, debate or even understand the far- reaching implications of the administration's ideas.
On the other hand, while many tribes and individuals criticized the proposal taken as a whole, many were not completely opposed to all aspects of the proposal and, indeed, some even agreed with certain aspects of the administration's ideas. For example, there was widespread acknowledgment that fractionated ownership of individual Indian lands has been a real, ever-worsening problem that has plagued the system for many decades--one that Indian country must confront and deal with now and not later--and that dealing with the problem will require solutions that are not altogether pleasant. And even though some commentators seemed to oppose any system of beneficiary-driven management decisions for trust lands, others recognized that the Indian tribes and Indian landowners can and will make better decisions regarding the use of their own lands than the Bureau of Indian Affairs if they are given the appropriate resources to do so. I am also submitting for the record a copy of a recent editorial that appeared in a widely read Indian periodical, Indian Country Today. The editorial suggests that certain aspects of the administration's proposals are in fact reasonable, including the idea that Indian beneficiaries will make good managers of their land, and it challenges Indian country to engage with the administration on its ideas and ``come back with an improved set of proposals based on them'' rather than just reject them out of hand.
So indeed, Mr. President, while I am disappointed that S. 1439 was not passed into law, I am also encouraged by the progress we have made in our understanding of trust management problems and in the willingness of the Indian tribes, individual Indians, representatives of the class action plaintiffs and the administration to engage in meaningful discussions on how to fix this system. I am hopeful that in the 110th Congress the Committee begins where we left off in this bill and that it will not shy away from the difficult issues of Indian trust reform.
Mr. President, I ask that the aforementioned documents be printed in the Record. The documents follow.
Newly Proposed Provisions for Senate Bill 1439 The Indian Trust Reform
Act
Senate bill 1439, the Indian Trust Reform Act of 2005,
would resolve the Cobell v. Kempthorne case and make reforms
to the way the United States manages Indian trust funds and
assets. The bill was introduced in July 2005 and Committee
staffs have been meeting with representatives from the
plaintiffs, the Administration, and Indian tribes to decide
what changes, if any, should be made to the bill. This paper
highlights several proposals that have come out of some of
those discussions.
To gain support for a multi-billion dollar bill, it may be
necessary to incorporate significant changes to the
management system for Indian trust assets. As proposed, these
changes would not remove the trust status of Indian lands,
but would reallocate significant decision-making authority
and legal responsibility from the Federal government to the
Indian tribes and individuals. The proposed changes are
generally described below.
The Chair and Vice-Chair of the Committee have not approved
these proposed changes to S. 1439, but have asked their
respective staff to seek input from Indian Country before
they make a decision on these proposals and how to proceed
with the bill.
Land fractionation--consolidate all 128,000 individual Indian
allotments into ownership of no more than 10 individuals
per tract of land within 10 years
The highly fractionated nature of many individual Indian
lands has made it difficult for the United States to manage
these lands and the revenues generated from them. There are
currently 128,000 individual Indian allotments and 3.6
million fractionated interests. One proposal to address this
issue has been to develop aggressive mechanisms to
consolidate all allotments into 10 or fewer owners for each
tract of land within the next 10 years.
All land would remain in Indian title with individual
Indian or tribal owners.
Consolidation would include voluntary and involuntary
mechanisms, but large interest owners would have a first
opportunity to buy out the smaller interest owners would have
a first opportunity to buy out the smaller interest owners
before an entire tract is put up for sale to either the tribe
or a member of that tribe.
Consolidation of tracts with 100 or more owners would be
prioritized.
Funding for the proposed consolidation mechanisms would be
assured by inclusion in the funding levels of the bill.
Beneficiary-managed trust--transition of all individual
Indian and tribal land to a beneficiary-managed trust
system within 10 years
After fractionated lands are consolidated, it is proposed
to convert the current management system for all individual
Indian and tribal land into a new system within a 10 year
timeframe. The lands would remain in trust and not be subject
to taxation, but the individual or tribal owner of the lands
would have most of the privileges and responsibilities of
property management.
The landowners would make nearly all decisions on land use
within certain broad parameters.
All revenues generated from the land would go directly to
the landowners (direct pay).
The landowners would negotiate their own long-tern leases
and land use agreements, without Secretarial approval.
The BIA would provide ``management'' financial support and
technical assistance during a transition period to assist
owners in becoming efficient property owners and managers.
The federal government would remain responsible for:
preventing involuntary alienation of land; approving
transfers of land title; maintaining land title records; and
probating trust estates.
Resolution of tribal claims related to the mismanagement of
trust funds, lands and resources
In addition to resolving all individual Indian claims
related to the United States' mismanagement of trust funds,
lands and resources, it has been proposed to resolve all
tribal claims for the same matters. Possible suggestions for
addressing this issue include:
All mismanagement claims for tribal monies, lands, and
resources would be resolved and settled.
A settlement fund would be established and each tribe would
receive a distribution based on a formula that would take
into account the amount of land a tribe owns and the amount
of revenues that were generated from that land for a
specified period of time.
All historical accounting claims against the United States
would be settled.
Account balances for Indian trust accounts would be deemed
accurate as of the date of passage of Senate bill 1439.
The bill would not settle takings claims for land or
related resources, claims to establish the right to possess
or the ownership of tribal land, or claims arising under
Federal environmental laws.
Limitation on liability of the United States during and after
transition period
In order to facilitate the proposed reforms, it has also
been proposed that during the period of time for land
consolidation and transition of the trust management system
into a beneficiary-managed trust there would be some
limitations on the liability of the United States in regard
to the management of trust resources.
After the transition period, the Federal government would
remain responsible for correcting errors, but without damage
claims against the government for its residual
responsibilities.
