NCPA - National Center for Policy Analysis

Interests of Indian Property Owners and Tribes Diverge

February 10, 2003

The 1887 Dawes Act allowed the break up of tribal lands into individual allotments and their assignment to individual Indian property owners. However, the federal government took the authority to lease out mining, drilling and lumbering rights without the consent of the new landowners.

The Individual Indian Money (IIM) trust fund was created to manage proceeds from the leases. It has collected the royalties to be paid into the relevant IIM accounts, and then to individual Indians on a regular basis. However, for decades the Bureau of Indian Affairs (BIA) has been inconsistent in its payments, and it cannot produce an accurate historical accounting of who has or hasn't been paid and what they're owed.

  • The unpaid royalties may date back more than 100 years, encompassing 300,000 accounts and 56 million acres, and with interest have grown to an estimated $10 billion to $100 billion.
  • A class-action lawsuit by Indian landowners against the U.S. Department of Interior -- currently named Cobell v. Norton -- has been going on for nearly seven years.
  • The plaintiffs want the IIM accounts taken out of BIA's hands and placed into receivership.

One problem with resolving the issue is that Indian landowners and tribal governments don't have quite the same interests.

  • BIA is the conduit for federal funds that the tribes receive for law enforcement, elections and government operations; and the Bureau oversees the granting (or withholding) of federal recognition of each tribe's existence and self-government rights.
  • The tribes (unlike IIM account-holders) have the legal authority to take their lands out of the trust system and handle the leases and royalties themselves; several have done so.

So tribal governments have an incentive to maintain good relations with the BIA, and little motivation to resolve the issue, say observers.

Source: Jacob T. Levy, "Broken Trust," New Republic Online, January 29, 2003.

 

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