Norton revamps trust fund system

FROM THE ARCHIVE

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WEDNESDAY, JULY 11, 2001

Acknowledging confusion within the ranks and a need to become more accountable to Congress, the courts, and American Indians, Secretary of Interior Gale Norton on Tuesday announced plans to revamp how her department handles and fixes the broken trust fund system.

In a memorandum addressed to her top advisers, including recently sworn in Indian Affairs Assistant Secretary Neal McCaleb, Norton outlines two major trust fund initiatives. One is intended to resolve "frustration and concerns" over management of trust reform while the other focuses on adequate resolution of the Cobell v. Norton class action lawsuit.

"My actions today," said Norton, "are meant to signal my unequivocal commitment to ensuring the progress of effective trust reform and to advance the Departmental responsibility to provide a historical accounting to IIM beneficiaries."

Norton's decisions represent her first major attempt to put the Bush administration's imprint on trust reform. They come a day after Indianz.Com reported she has decided to drop a costly and controversial plan to sample the trust accounts, which had been approved by the Clinton administration.

But while the Interior is positioning the new initiatives as a means of streamlining her trust responsibilities to an estimated 300,000 American Indians throughout the country, the Cobell plaintiffs aren't welcoming them with open arms.

"If they set up another office, I am going to be so angry," said lead plaintiff Elouise Cobell a few hours before Norton announced the creation of the Office of Historical Trust Accounting.

"The plaintiffs in this litigation have fought for five years for effective reform of the trust," she said later upon hearing the news. "However, our experience over the past five years gives us little confidence that reform from within is possible."

To carry out her goals, Norton yesterday signed two Secretarial orders. The first gives Special Trustee Tom Slonaker, a Clinton appointee whom the Bush administration has retained to oversee the trust accounts, more power to manage trust reform projects.

Recognizing shortcomings at the Interior, the order also authorizes Slonaker to use an outside contractor to assess the government's management problems. An Interior official told Indianz.Com EDS Corporation has been given nearly $1 million to "assist us us in evaluating what we need to do now in helping keep this project on track."

The contract will run until the end of the current fiscal year, with the option of being renewed. Fiscal year 2002 begins on October 1.

The second order creates an additional office whose sole goal will be providing a full, historical accounting to the Individual Indian Money (IIM) account holders. Within the next two months, the office will come up a reconciliation plan and will consult with all affected parties on what steps to take next.

"It's pretty clear we are going to have to do a full accounting as [US District Judge Royce Lamberth] ordered and as the appeals court said in February," the official said. "It's going to be a tremendous job."

The new office is to be headed by Bert T. Edwards, who will report directly to Norton. Edwards is a former Clinton official who served as Chief Financial Officer to the Department of State and Assistant Secretary for the Bureau of Financial Management and Policy under former Secretary Madeleine Albright. He is also a former partner with Arthur Anderson LLP, an accounting and auditing firm.

Get Trust Fund Documents:
Action regarding Trust Reform and Historical Accounting (7/10)
ORDER NO. 3231: Establishment of the Office of Historical Trust Accounting (7/10)
ORDER NO. 3232: Trust Reform (7/10)

Today on Indianz.Com:
Latest trust fund system a 'failure' (7/11)

Relevant Links:
EDS Corporation - http://www.eds.com
Office of the Special Trustee - http://www.ost.doi.gov
Trust Management Improvement Project - http://www.doi.gov/bia/trust/tmip.htm
Indian Trust: Cobell v. Norton - http://www.indiantrust.com