Bush plan ignored historical accounting doubts

TUESDAY, JULY 16, 2002

The federal government's top trust reform official last month refused to sign off on a project the Bush administration used to justify its costly and controversial historical accounting plan.

Special Trustee Tom Slonaker, a Clinton appointee, was asked to certify work performed on 8,000 trust fund accounts. The Office of Historical Trust Accounting, an initiative of Secretary Gale Norton, claimed $22.7 million in funds was reconciled for a group of Indian Indian Money (IIM) beneficiaries.

But Slonaker didn't agree with the assessment. "Absent an overall historical accounting definition for all IIM accounts or a specific definition by account type ," he wrote on June 5, "I cannot concur that the reconciliation of the judgment accounts constitutes an historical accounting."

Slonaker's objections, however, never made it into the $2.4 billion, 10-year plan the Department of Interior released one month later. OHTA Director Bert T. Edwards instead said the reconciliation was proof that a full accounting was realistic.

"Based on a pilot project to reconcile a number of judgment and per capita accounts," the July 3 plan stated, "Interior believes that accurate, reliable historical accountings can be performed on these accounts."

The work in question goes back to late 2001, when OHTA enlisted a number of firms -- including the convicted Arthur Andersen -- to perform several tests. It was envisioned the projects would help determine the cost and time needed to perform the entire accounting.

Those expectations were questionable from the start, as noted by a court official watching over the debacle. Court monitor Joseph S. Kieffer last week said the plan confirmed Slonaker's "worst fears."

Some lawmakers also had doubts and last week approved a spending bill that limits funds for the undertaking. In fiscal year 2003, the House Appropriations Committee said it would only provide $15 million for an accounting covering the years 1985 to 2000.

The department on the other hand estimates a cost of $907 million for that same time period. Going back to the inception of the IIM trust in 1887 requires an additional $1.5 billion, OHTA said.

The accounting has generated controversy. The leaders of the Congressional Native American Caucus, a bipartisan group of 99 lawmakers, said they would fight the limitations.

Rep. Nick Rahall (D-W.Va.), the ranking member of the House Resources Committee, added his disapproval yesterday. "This provision in the Interior Appropriations bill is like telling people to forget what balance they had in their checking accounts before 1985 and trust the bank to estimate an accurate balance regardless of any records you have proving otherwise," he said.

"Congress will never be able to fulfill its trust responsibility to Indian Country if we do not commit the necessary financial resources to address the trust fund crisis," he added. "This provision is unacceptable and I will fight it on the House floor."

Rahall wrote a letter to House rulemakers to challenge the bill. Debate on the floor could come as early as today.

Relevant Documents:
Rahall Letter (7/15) | Hayworth-Kildee Letter (7/12) | 8th Court Monitor Report (7/11) | House Committee Report (7/9) | Senate Committee Report (6/27)

Relevant Bills:
H.R.5093 | S.2708

Relevant Links:
Indian Trust, Department of Interior - http://www.doi.gov/indiantrust
Indian Trust: Cobell v. Norton - http://www.indiantrust.com
Trust Reform, NCAI - http://www.ncai.org/main/pages/
issues/other_issues/trust_reform.asp