Cobell lawsuit settlement will affect Montana tribes

By Lailani Upham

WASHINGTON, D.C. — It’s been a week and half since the settlement agreement was announced between Elouise Cobell, lead plaintiff in the Cobell v. Salazar class action lawsuit over federal mismanagement of individual Indian trust fund accounts.

The settlement agreement totaled about $3.4 billion, of that, $1.4 million would be disbursed to IIM account holders. The remaining $2 billion would be used to consolidate tribal lands by purchasing “fractionated” land interests.

Before dispersing money, the settlement agreement must be approved by Congress and a federal district court, according to Senator Byron Dorgan (D-ND) Chairman of the Senate Committee on Indian Affairs. “Ultimately, Congress must approve implementation of this settlement. I am committed to ensuring that the settlement is fair and equitable, and to Congress considering it expeditiously,” Dorgan said during a press release last week.

According to a report in the Billings Gazette, Montana tribal members will receive about $27 million from the proposed settlement.

Public Affairs Specialist for the Office of the Special Trustee, Debby Pafel explained, “There are two classes created in the settlement agreement. A person could belong to both classes and, therefore, receive $1,000 as a member of the Historical Accounting Class, and $500 as a member of the Trust Administration Class.”

According to definitions in the settlement agreement, members in the first category, the historical accounting class, include anyone who had an IIM account between Oct. 25, 1994, and Sept. 30, 2009, and anyone whose account has at least one cash transaction at any time.

The Trust Administration class defines it as, anyone who has or had an IIM account in the Electronic Ledger Era starting in 1985, or anyone who can demonstrate ownership interest in trust land, regardless of the existence of an IIM and regardless of the proceeds, if any, from the land. Account holders in this category will receive $500.

Not all tribal members have IIM accounts or qualifying land interests, but thousands on Montana’s seven reservations will benefit.

After Congress approves implementation of the settlement, notifications to the class members will be sent out and the settlement funds will be deposited with the trust department of a private bank selected by the plaintiffs based on criteria set forth in the Agreement.

According to the Department of Interior, the notifications will go out to several hundred thousand class members stating: an explanation, a description of the settlement, procedures for distributing the settlement fund, the amount of attorneys’ fees, the manner in which a person can opt out of the settlement, and contact information for inquiries. The members will have time to review and understand the settlement, and have 60 days to decide whether to opt out of the settlement. The District Court Judge will then determine if the notice and opt out process was fair. After that, the judge reviews the entire process. Upon his approval, the settlement becomes effective.

According to DOI information gathered by the Gazette the following are breakdowns of the number of IIM accounts within Montana tribes: the Blackfeet Nation have a total of 3,721 accounts; the Crow have 3,089; the Fort Peck Tribes have 3,026; the Salish and Kootenai Confederation have 2,606; the Northern Cheyenne have 1,629; the Fort Belknap reservation has 1,485; and the Chippewa Cree Tribe has 350.

Senator Max Baucus stated after the announced settlement agreement, “I’m happy that there has been an agreement reached on the Cobell lawsuit. Montana Indians have been waiting for years for this. For too long, Native Americans have been denied fair and full compensation for the timber production, leasing of mineral rights, and grazing on tribal trust lands. While Congress must still pass authorizing legislation to enact the settlement, this is a critical first step. I applaud Elouise Cobell for her unwavering fight to correct the unfair accounting practices that negatively affected Indians with Individual Indian Money accounts for decades.”

Although the settlement is good news for the tribes across the nation, the “fractionation” of land interests that succeeded through generations dating back to 1887 is one of the root causes of the lawsuit because it made accounting for land interests nearly impossible.

The Dawes Act of 1887 allotted individual tribal members lands on their reservation that were divided into small parcels. When an original allottee died, usually without a will, his or her land was divided among the heirs and through several generations; up until today, fractionation has rendered many of those interests so small that it became a management nightmare rendering the value of the land practically worthless, and the problem grew whenever land was passed on.

The settlement establishes a $2 billion fund to provide individual tribal members the opportunity to receive cash payments for divided land interest and free up land for tribal communities on a voluntary buy-back and consolidation of fractionated land interests.

The reduction in individual trust accounts enables the U.S to greatly reduce on-going administrative expenses and future accounting-related disputes.

Through the settlement, the Interior Department will set aside up $60 million of the interests into a college and vocational school scholarship fund for American Indian students.

Senator Jon Tester, a member of the Senate Indian Affairs Committee stated in response to the Cobell class-action lawsuit settlement, “This is milestone for all folks in Indian Country, and I’m proud of the Montanans who made history by working together for years to reach this agreement. We still have a long way to go, but as a member of the Indian Affairs Committee, I’ll keep working with folks on the ground to empower Montana’s sovereign tribes and make sure the federal government meets its trust responsibilities.”

Elouise Cobell, an enrolled member of the Blackfeet Tribe filed the lawsuit 13 years ago alleging that the federal government mismanaged trust funds for hundreds of thousands of American Indians.