[Congressional Record (Bound Edition), Volume 148 (2002), Part 17]
[Senate]
[Pages 23341-23342]
[From the U.S. Government Publishing Office, www.gpo.gov]




                     INDIAN TRUST FUNDS MANAGEMENT

  Mr. McCAIN. Mr. President, I would like to make a brief statement for 
the Record regarding an issue of significant importance to me, and that 
is the fiduciary and trust responsibility of the United States toward 
Native Americans for management of trust assets and trust funds.
  Earlier this year, I introduced S. 2212, the Indian Trust Asset and 
Trust Fund Management and Reform Act of 2002. This legislation would 
have amended the 1994 American Indian Trust Fund Management Reform Act 
to initiate further reform of the administration and management of the 
assets and funds held by the United States in trust for federally 
recognized Indian tribes and individual Indians. I was pleased to be 
joined in this effort by my distinguished colleagues, the two Senators 
from South Dakota, Mr. Daschle and Mr. Johnson, and I appreciate the 
time and effort they have expended as we have tried to move the bill 
toward enactment.
  I also thank the chairman of the Committee on Indian Affairs, Senator 
Inouye, for holding a hearing on S. 2212 in July. As a result of the 
testimony received in the hearing and the comments from many of the 
Indian tribes that would be affected by this legislation, we developed 
an amendment in the nature of a substitute which significantly improved 
the original bill. Many tribal leaders shared comments and offered 
recommendations to us in the process and were grateful for their 
efforts.
  By sponsoring this legislation, Senators Daschle, Johnson, and I 
intended to express congressional support and provide direction for 
reform of the Federal Government's management of Indian trust funds and 
assets, which has for some time been subject to intense criticism and 
scrutiny by the Federal courts. High-level Government officials have 
been held in civil contempt twice by the U.S. District Court here in 
Washington, DC, for their abject breach of fiduciary duties as well as 
the continuing failure to comply with statutory mandates and court 
orders.
  S. 2212 focused on two primary changes to the 1994 American Indian 
Trust Fund Management Reform Act, the underlying law governing Indian 
trust funds management. First, it would have created a single line of 
authority in the Interior Department by establishing a Deputy Secretary 
for Trust Management and Reform; and second, the bill would have 
strengthened provisions for Indian tribes and beneficiaries to directly 
manage or comanage with the Interior Secretary trust funds and assets, 
based on successful self-determination policies.
  Based on comments received from tribes, we amended S. 2212 to affirm 
the fiduciary standards to be applied to the management of Indian trust 
funds and assets, as well as to abolish the Office of Special Trustee 
and establish the Office of Trust Reform under the new Deputy 
Secretary. The Advisory Committee to the Special Trustee would have 
been replaced with a task force composed of representatives of the 
tribes and the Department who would work with the new Deputy Secretary 
to develop recommendations for further necessary changes to the laws 
governing the management of trust assets and trust funds.
  The changes represented in S. 2212 were modest, but important. It 
could have formed the basis for a stronger partnership between the 
tribal beneficiaries and the Interior Department, instituting 
congressional requirements for development of consensus policies 
governing trust standards and additional management reforms. Such a 
partnership would have set the Department and the tribes on a course 
toward resolution of the problems that have plagued the management of 
the trust funds and assets for more than a century.
  Unfortunately, we are at the end of the 107th Congress and no further 
action will be taken on S. 2212. A sufficient consensus could not be 
reached among the tribes as well as between the tribes and the 
Department of the Interior to allow us to move forward to enact the 
bill. By failing to enact legislation like S. 2212 this year, the 
Congress is not fulfilling its responsibility to the Indian tribes and 
individuals who have suffered from decades of Federal mismanagement.
  For most of this year, tribal representatives have been working on a 
range of possible reforms through a special task force established by 
Secretary Norton after the tribes resoundingly rejected her 
administrative reform proposal during 2001. Despite the efforts of the 
tribes, the discussions with the Interior Department culminated in an 
impasse and an end to the Department's participation in the task force.
  The Department's latest action is unfortunate, but it is certainly 
not the first time the tribes and the Department have been unable to 
agree. It should not pose an insurmountable hurdle for the Congress to 
act. In fact, it merely adds impetus to the need for amendments to the 
1994 act, particularly to ensure through legislative language that the 
Interior Department would be required to consult and work with the 
affected beneficiaries on any reforms or changes to its management. 
Court requirements may now compel the Interior Department to once again 
develop its own management reforms without the consultation or 
agreement of the affected beneficiaries.
  The sponsors of S. 2212 were told that we shouldn't act on this 
legislation in this session because of the lack of agreement between 
the tribes and the Department of the Interior. At the same time, 
several efforts ensued by the Department and some tribal 
representatives to add legislative riders to appropriations bills or 
other must-pass legislation. These were efforts I could not support as 
I continue to abide by the principle of legislating through the open 
processes of the Congress.
  It is certainly true that no one fully agreed with everything in S. 
2212. That fact suggests to me that the bill deserved our full and fair 
consideration because it represented a balanced approach. S. 2212 was 
intended to foster a process of further reform in the years ahead and 
not to impose some sort of ``quick fix'' or ``final remedy'' that is 
not fully embraced by all interested and affected parties.
  Senators Daschle, Johnson, and I worked very hard to achieve 
consensus

[[Page 23342]]

on S. 2212 and while we garnered significant tribal support for this 
legislative remedy, we abided by the wishes of the tribal task force 
leadership to withhold from further action on the bill. Without 
legislative reform this year, I am very much concerned that trust 
duties will effectively be redefined and reassigned by the courts and 
the Department without the input or approval of the Congress and the 
affected beneficiaries.
  I have no doubt that the Congress will be urged to act again in the 
108th Congress as the matter of trust fund management will continue to 
require legislative review and reform. I believe a significant 
opportunity may have been lost by not enacting S. 2212, but I remain 
committed to ensure that the Federal Government's responsibility to the 
individual and tribal beneficiaries will be fulfilled.

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