[Federal Register Volume 59, Number 156 (Monday, August 15, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-19860]


[[Page Unknown]]

[Federal Register: August 15, 1994]


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Part VIII





Department of the Interior





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Bureau of Indian Affairs



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25 CFR Part 115




Individual Indian Money Accounts; Proposed Rule




DEPARTMENT OF THE INTERIOR

Bureau of Indian Affairs

25 CFR Part 115

RIN 1076-AC65

 
Individual Indian Money Accounts

AGENCY: Bureau of Indian Affairs, Interior.

ACTION: Proposed rule.

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SUMMARY: The Bureau of Indian Affairs (BIA) is proposing to revise and 
replace the existing regulations contained in 25 CFR Part 115 governing 
the establishment, management, control, closure and deletion of 
Individual Indian Money (IIM) accounts, by the Secretary of the 
Interior. The growth in the number of IIM accounts maintained by the 
BIA makes it necessary and desirable for the Secretary of the Interior 
to promulgate revised regulations that will secure the integrity of the 
system and ensure that the IIM accounts will be maintained in an 
efficient and accountable manner.
    The proposed regulations clarify and expand upon current 
regulations, and to the extent practicable, incorporate and standardize 
BIA practices for maintaining and administering IIM accounts.

DATES: Comments must be received on before October 14, 1994.

ADDRESSES: Written comments should be directed to the Bureau of Indian 
Affairs, Office of Trust Funds Management, 505 Marquette N.W., Suite 
700, Albuquerque, New Mexico 87102.

FOR FURTHER INFORMATION CONTACT: Mr. Jim Parris, Bureau of Indian 
Affairs, Office of Trust Funds Management, 505 Marquette NW, Suite 700, 
Albuquerque, New Mexico 87102, telephone number 505-766-3233.

SUPPLEMENTARY INFORMATION: This proposed rulemaking action will revise 
Part 115 to Chapter 1 of Title 25 of the Code of Federal Regulations, 
which contains general regulations governing Individual Indian Money 
(IIM) accounts, to set forth authorities, policy, and procedures to be 
followed governing the establishment, management, control, closure, and 
deletion of Individual Indian Money (IIM) accounts, by the Secretary of 
the Interior, with certain exceptions which are set forth in 25 CFR 
Parts 16 and 116 (Five Civilized Tribes), 25 CFR Parts 17 and 117 
(Osage).
    Section 115.1  This section sets forth the purpose and scope of 
these regulations. The Secretary of the Interior is obligated by 
statute to establish, manage, and control individual Indian money 
accounts, and has been granted the authority to promulgate regulations 
to implement such responsibilities.
    Section 115.2  This section revises former Sec. 115.1 and expands 
upon the definitions for the purpose of clarification, standardization, 
and to avoid ambiguities in the implementation of Part 115.
    Section 115.3  This section is new and sets forth the authority and 
procedures for establishing IIM accounts.
    Section 115.3(a)  This paragraph formalizes the authority of the 
Secretary to establish IIM accounts. To avoid potential duplication of 
IIM accounts and resulting inconsistencies in the management of an 
individual's trust funds, this paragraph authorizes only one IIM 
account per account holder.
    Section 115.3(b)  This paragraph specifies the Bureau of Indian 
Affairs agency is responsible for establishing and maintaining an IIM 
account.
    Section 115.3(c)  This paragraph requires that the social security 
number for the account holder be furnished to the Secretary thereby 
enabling the Secretary to meet the requirement to comply with the 
reporting and filing requirements set forth by the Internal Revenue 
Code, including the Tax Equity and Fiscal Responsibility Act of 1982, 
and those of the various states. See Sec. 115.10.
    Section 115.4  This is a new section which formally recognizes the 
authority of the Secretary to close and delete certain IIM accounts. It 
is noted that the closure or deletion of an IIM account does not 
preclude the Secretary from reopening or re-establishing such account.
    Section 115.4(a)  This paragraph establishes the circumstances 
under which the Secretary will close an IIM account.
    Section 115.4(b)  This paragraph provides for deletion of an IIM 
account from the system after one year from the date of closure, thus 
allowing for the Secretary to meet tax reporting and filing 
requirements.
    Section 115.5  This section revises former Sec. 115.6. Conditions 
do arise requiring the Secretary to accept and place monies which are 
not derived from trust resources, tribal judgment awards, or other 
Federal Agencies in IIM accounts to meet critical situations as defined 
in Sec. 115(8)(c).
    Section 115.6  This section is new and recognizes the statutory 
authority of the Secretary to invest funds for the benefit of account 
holders.
    Section 115.7  This section is new and provides direction and 
standardization of the disbursement policy and procedures for IIM 
funds. Section 115.7(a) This paragraph requires that funds will be 
automatically disbursed unless otherwise provided by this part.
    Section 115.7(b)  This paragraph formally recognizes the general 
statutory prohibition of payment of judgments and/or levies, or 
placement of liens against funds from IIM accounts, unless such levies 
and/or liens are specifically permitted by statute or Title 25 of the 
Code of Federal Regulations. This paragraph also recognizes the 
authority of the Secretary to apply an account holder's funds against 
delinquent debts due the United States and/or the account holder's 
tribe, subject to certain limitations and conditions.
    Section 115.7(c)  This paragraph recognizes the Secretary's 
authority to supervise certain categories of IIM accounts and to place 
conditions on disbursements pursuant to Sec. 115.8.
    Section 115.7(d)  This paragraph recognizes the Secretary's 
authority to correct posting and recording errors which are clerical in 
nature, provided corrections are made prior to disbursement of funds. 
Where the posting error has resulted in a wrongful disbursement, the 
Secretary may place restrictions on the accounts affected by the 
disbursement until such time that the wrongful disbursement is 
rectified. In these cases, the regulation affords opportunity for 
notice and hearing to the affected account holder pursuant to 
Sec. 115.12.
    Section 115.7(e)  This paragraph recognizes the authority of the 
Secretary to place restrictions on an IIM account to which 
distributions of estate proceeds have been made pursuant to the probate 
order of the administrative law judge, and subsequent modifications to 
the order require reallocation of the initial distribution. The account 
holder so affected is given an opportunity to dispute the equity of the 
restrictions.
    Section 115.7(f)  This paragraph provides for prompt payment to be 
made to rightful owner(s) within an specified time when an erroneous 
disbursement has occurred.
    Section 115.8  This section revises former Sec. 115.4 and 
recognizes the authority of Federal agencies to deposit monies into the 
IIM account for the benefit of minors or adults, non compos mentis or 
under other legal disability, for whom no legal guardian or fiduciary 
has been appointed. This section provides for the supervision of IIM 
accounts for six categories of account holders.
    Section 115.8(a)  This paragraph denotes ``Minors'' as supervised 
account holders.
    Section 115.8(a)(1)  This subparagraph revises former Sec. 115.4(a) 
and provides for the supervision of funds of a minor, except for those 
funds derived from per capita shares of tribal judgment awards.
    Section 115.8(a)(2)  This subparagraph revises former Sec. 115.4(b) 
and provides for the supervision of funds of a minor which have been 
derived from per capita shares of tribal judgment awards. The 
limitation on the amount of funds disbursed and reference to 
withdrawals upon reaching the age of majority have been removed so as 
to avoid potential conflict with any congressional plan associated with 
the judgment award.
    Section 115.8(b)  This paragraph revises former Sec. 115.5 and 
denotes ``Adults, non compos mentis or under other legal disability'' 
as supervised account holders. This paragraph provides for conditions 
of disbursement similar to those of minor account holders.
    Section 115.8(c)  This paragraph is new and denotes ``Account 
holders requesting and requiring assistance'' as supervised account 
holders. This paragraph references Sec. 115.3(d) which clarifies the 
right of those account holders, whose IIM accounts are not otherwise 
restricted under this part, to place conditions of disbursement upon 
their IIM accounts. Under this new paragraph, such conditions of 
disbursement shall not take effect unless approved by the Secretary.
    Section 115.8(d)  This paragraph is new and denotes ``Account 
holders--Whereabouts unknown'' as supervised account holders.
    Section 115.8(e)  This paragraph replaces Sec. 115.11 and revises 
the language to read ``Deceased account holders other than those of the 
Five Civilized Tribes and the Osage Tribe'' as supervised account 
holders. Part 15 of this chapter was modified to add ``the Osage 
Tribe'' and this paragraph will revise the language to include the 
addition of the Osage Tribe also. This paragraph references 25 CFR Part 
15 which in turn references 43 CFR Part 4, Subpart D. When the 
provisions governing the administration of these IIM accounts were 
incorporated into 43 CFR part 4, Subpart D, in 1971, the language 
appearing in Sec. 115.11 was not modified accordingly. This paragraph 
will correct that oversight.
    Section 115.8(f)  This paragraph denotes ``Deceased account holders 
of the Five Civilized Tribes'' as supervised account holders and 
revises former Sec. 115.12. The substance of this regulation has not 
been significantly changed.
    Section 115.8(g)  This paragraph is new and provides restoration of 
unclaimed IIM monies to tribal ownership or deposit to the general fund 
of the U.S. Treasury after six (6) years.
    Section 115.8(h)  This paragraph is new and provides guidance in 
handling proceeds of sale of capital assets in compliance with proposed 
use plans approved by the Secretary or authorized representative prior 
to sale.
    Section 115.8(i)  This paragraphs is new and provides direction in 
dealing with creditor claims against an account holder.
    Section 115.9  This paragraph is new and sets forth authority for 
providing statements to IIM account holders.
    Section 115.9(a)  This paragraph formalizes the authority of the 
Secretary to provide periodic statements of IIM accounts to account 
holders.
    Section 115.9(b)  This paragraph formalizes the authority of the 
Secretary to provide account statements to minors and adults, non 
compos mentis or under other legal disability.
    Section 115.9(c)  This paragraph recognizes the statutory 
obligation of the Secretary to provide explanation of payments of oil 
and gas royalties to respective account holders, as required by 30 
U.S.C. 1701.
    Section 115.10  This section is new and recognizes the reporting 
requirements imposed upon the Secretary by the Internal Revenue Code 
and regulations promulgated thereunder. This section also authorizes 
the Secretary to meet the filing requirements of the Internal Revenue 
Service, and the various states, for and on behalf of supervised 
account holders.
    Section 115.11  This is a new section which incorporates, by cross 
reference, 25 CFR Part 103, Sec. 103.33 Assignment of Income, into this 
part.
    Section 115.12  This section revises former Sec. 115.10 and 
clarifies and elaborates upon the application of the notice and hearing 
requirements of the Administrative Procedure Act, for the purposes of 
this part.
    Section 115.13  This section revises former Sec. 115.13 and brings 
the regulation into compliance with 25 U.S.C. 954(e).
    Section 115.14  This section revises former Sec. 115.14 and updates 
the reference to Sec. 115.12.
    The policy of the Department of the Interior is, whenever, 
practical, to afford the public an opportunity to participate in the 
rulemaking process. Accordingly, interested persons may submit written 
comments regarding the proposed rule to the locations identified in the 
Addresses section of this preamble.
    The Department of the Interior has determined that this rule is not 
a significant regulatory action under Executive Order 12866, and 
therefore will not be reviewed by the Office of Management and Budget. 
This rule will not have a significant economic impact on a substantial 
number of small entities under the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.).
    The Department of the Interior has determined that this proposed 
rule does not constitute a major Federal action significantly affecting 
the quality of the human environment and that no detailed statement is 
required pursuant to the National Environmental Policy Act of 1969.
    The Department of the Interior has certified to the Office of 
Management and Budget that this proposed regulation meets the 
applicable standards provided in Sections 2(a) and 2(b)(2) of Executive 
Order 12778.
    The Department of the Interior has determined that this proposed 
rule does not have significant takings implications.
    The Department of the Interior has determined that this proposed 
rule does not have significant federalism effects.
    This rule does not contain information collection requirements 
which require approval of the Office of Management and Budget under 44 
U.S.C. 3501 et seq.
    The primary author of this proposed rule is William F. Benjamin, 
Jr., Chief, Branch of Payments, Bureau of Indian Affairs, Division of 
Accounting Management, Office of Management and Administration. 
However, personnel from other offices of the Bureau of Indian Affairs, 
the Department of the Interior, Office of the Solicitor--Indian Affairs 
and tribal representatives participated in the developing of the 
regulations both on matters of substance and style.

List of Subjects in 25 CFR Part 115

    Indians--business and finance; Administrative practices and 
procedures.

    For the reasons set out in the preamble, 25 CFR part 115 is 
proposed to be revised to read as follows.

PART 115--INDIVIDUAL INDIAN MONEY ACCOUNTS

Table of Contents

Sec.
115.1  Purpose, scope and information collection.
115.2  Definitions.
115.3  Establishing IIM accounts.
115.4  Closure and deletion of accounts.
115.5  Voluntary deposits.
115.6  Investment of IIM funds.
115.7  Disbursement policy and procedures.
115.8  Supervised IIM accounts.
115.9  Statement of IIM account.
115.10  Tax requirements.
115.11  Assignment of income.
115.12  Notice and hearing.
115.13  Assets of members of the Aqua Caliente Band of Cahuilla 
Indians.
115.14  Appeals.

    Authority: 5 U.S.C. 301; 25 U.S.C. 2, 9; 25 U.S.C. 954(e); 43 
U.S.C. 1457.


Sec. 115.1  Purpose, scope and information collection.

    (a) These regulations set forth the authorities, policy, and 
procedures governing the establishment, management, control, closure, 
and deletion of Individual Indian Money (IIM) accounts, by the 
Secretary of the Interior. Certain exceptions to these rules are set 
forth in 25 CFR Parts 16 and 116 (Five Civilized Tribes) and 25 CFR 
Parts 17 and 117 (Osage).
    (b) These regulations do not contain information collection 
requirements that require the approval of the Office of Management and 
Budget under 44 U.S.C. 3501 et seq.
    (c) Disclosure of any account information from IIM Ledgers and 
Cards and IIM Case Files systems is controlled by the Privacy Act of 
1974, as amended, 5 U.S.C. 522a.


Sec. 115.2  Definitions.

    Account holder means a beneficiary of an IIM account.
    Adult means an account holder who has reached the age of 18.
    Agency means an Indian agency or other field unit of the Bureau of 
Indian Affairs having trust or restricted Indian land under its 
immediate jurisdiction.
    Closure means placing an IIM account in a status whereby such 
account is no longer accessible for accounting activity.
    Deletion means elimination of an account from the IIM accounting 
system.
    Funds means monies deposited and/or held in an IIM account whether 
derived from trust and restricted resources, Federal entities, tribal 
judgment awards or voluntary deposits.
    Inactive means there has been no posting into or out of an IIM 
account for 13 months.
    Individual Indian Money (IIM) account means a U.S. Treasury account 
established and controlled by the Secretary of the Interior for the 
purpose of depositing, maintaining and disbursing funds for the benefit 
of an individual recognized by the Secretary as an Indian or Alaskan 
Native to whom the United States owes a trust and/or fiduciary 
responsibility.
    Interest means the earnings derived from the investment of IIM 
funds during the time they are in the custody of the Secretary.
    ISSDA means Indian Service Special Disbursing Agent.
    Minor means an account holder who has not reached the age of 18.
    Secretary means the Secretary of the Interior or authorized 
representative, and, for purposes of Sec. 115.13, means the officer in 
charge of the Palm Springs Office, Bureau of Indian Affairs.
    Supervised IIM account means an IIM account administered by the 
Secretary for a minor, an account holder declared non compos mentis or 
under other legal disability, an account holder requesting or requiring 
assistance with the management of his/her funds, an account holder 
whose whereabouts are unknown, or a deceased account holder.
    Voluntary deposit means acceptance of a deposit of money by the 
Secretary or authorized representative from an account holder, or any 
person or entity, into an IIM account. Monies deposited by a Federal 
entity pursuant to 25 U.S.C. 14 or by a tribe are authorized deposits 
and shall not be considered voluntary deposits.


Sec. 115.3  Establishing IIM accounts.

    (a) The Secretary is authorized to establish one IIM account per 
account holder except as otherwise provided by statute.
    (b) The Secretary shall establish an IIM account at the agency as 
indicated by the respective account holder's identification number. The 
responsible agency is normally the agency that serves the tribe in 
which the account holder is enrolled.
    (c) Prior to the establishment of an IIM account, the account 
holder's social security number shall be provided to the Secretary.


Sec. 115.4  Closure and deletion of accounts.

    (a) The Secretary may close an IIM account under the following 
circumstances:
    (1) Upon determination that an account is inactive for one or more 
of the following reasons:
    (i) Readily available evidence indicates that no further trust 
income is forthcoming;
    (ii) The account holder does not own any trust assets; or
    (iii) The account has a balance of less than $15 that has not been 
disbursed during the year due to administrative policy. In this case, 
the funds shall be disbursed at year end closing regardless of amount 
and the account closed provided the conditions of (i) and/or (ii) above 
apply. The provisions of Sec. 115.8 (d) and (g) shall apply for an 
account holder whose whereabouts are unknown.
    (2) Upon fulfillment of the orders of the Administrative Law Judge, 
Office of Hearings and Appeals, the restoration to tribal ownership as 
provided Sec. 115.8(g) or like authority as provided by statute;
    (b) After an IIM account has been closed for a period of one year, 
the Secretary will delete the account from the IIM accounting system 
within the following six month period.


Sec. 115.5  Voluntary deposits.

    Voluntary deposits for the sole purpose of investment will not be 
accepted by the Secretary. Voluntary deposits shall be excepted under 
the following conditions:
    (a) Monies received from Federal agencies pursuant to 25 U.S.C. 14 
for the benefit of a minor or adult, non compos mentis or under other 
legal disability, for whom no legal guardian or fiduciary has been 
appointed may be deposited into the account holder's IIM account; or
    (b) Monies from any source may be deposited into an account when 
the account holder has been determined to be in need of assistance by 
the Secretary in accordance with the provisions of Sec. 115.8(c), or to 
avoid a substantial hardship explained in a recorded written 
justification approved by the Secretary and maintained in the records 
of the account holder.


Sec. 115.6  Investment of IIM funds.

    The Secretary is authorized, in his/her discretion, to invest IIM 
funds in accordance with 25 U.S.C. 162a during the time they are in the 
custody of the Bureau of Indian Affairs.


Sec. 115.7  Disbursement policy and procedures.

    (a) Except as otherwise provided in this part, the Secretary shall 
automatically disburse to the account holder funds and accrued interest 
funds held in an unrestricted, unsupervised IIM account. All 
disbursements shall be made at times and places the Secretary may 
designate.
    (b) Funds shall not be disbursed for the payment of judgments, 
levies, and/or liens, absent specific authorization by statute and/or 
Title 25 of the Code of Federal Regulations except as provided in 
paragraph (c) of this section.
    (c) Funds of an account holder may be applied by the Secretary 
against delinquent debts to the United States or to the tribe of which 
the account holder is a member, unless such payments are prohibited by 
acts of Congress; and against money judgments rendered by Courts of 
Indian Offenses or any ordinances or codes of the tribe not prohibited 
by Federal laws.
    (1) A temporary restriction shall be placed on the affected IIM 
account on receipt of an order of execution of a Court of Indian 
Offenses money judgment pending final determination of collection 
action by the Secretary.
    (2) Notice of the proposed collection action shall be provided to 
the account holder pursuant to Sec. 115.12 at the time the temporary 
restriction is placed.
    (d) Funds of an account holder that have been placed under 
supervision pursuant to the authorities set forth in Sec. 115.8 (a), 
(b), (c), (d), (e) or (f) shall be disbursed in strict accordance with 
the provisions of the applicable authority. Although a restriction may 
be placed on an adult's IIM account at the time supervision is approved 
by the Secretary under authority of Sec. 115.8 (b), (c) or (d), notice 
must be provided to the account holder as required in Sec. 115.12.
    (e) Posting and/or recording errors may be corrected at the 
Secretary's discretion, provided disbursement has not been made. If an 
erroneous disbursement is made, corrective action will be taken 
pursuant to Sec. 115.7(f).
    (f) If an IIM account(s) is credited pursuant to a probate order of 
an administrative law judge and that order is subsequently modified to 
effect a different distribution of the estate, a temporary restriction 
will be placed on the affected IIM account(s) immediately upon receipt 
of the modification. The restriction shall remain effective until the 
Secretary determines the final collection action to be taken. The 
Secretary shall notify the affected account holder(s), pursuant to 
Sec. 115.12, at the time the temporary restriction is placed.
    (g) In no instance shall an erroneous disbursement delay prompt 
payment to the rightful owner.
    (1) Within five working days after discovery that an erroneous 
disbursement has been made from an IIM account, the deputy ISSDA shall 
transmit a complete report of the incident to the ISSDA, and the Agency 
Superintendent shall place a restriction on the IIM account of the 
beneficiary of the error.
    (2) The report shall indicate: the cause of the error; recommended 
corrective action; impact on account holder; and when collection of any 
overpayment might be expected and its source.
    (3) The ISSDA shall, within ten working days of receipt of the 
report: authorize payment to the rightful owner from available 
appropriated funds subject to the Secretary's delegated authority, 
place a restriction on the IIM account of the erroneous beneficiary 
and/or direct any other remedial action as he/she determines required 
or appropriate.
    (4) Upon receipt of instruction from the ISSDA, the Agency 
Superintendent shall immediately issue the notice of the proposed 
collection action to the erroneous beneficiary in accordance with 
Sec. 115.12.


Sec. 115.8  Supervised IIM accounts.

    (a) Minors. (1) Funds of a minor, except as otherwise provided in 
paragraph (a)(2) of this section, shall be disbursed, in amounts deemed 
by the Secretary to be necessary in the best interest of the minor for 
the minor's support, health, education, and/or welfare. Disbursements 
shall be made upon such conditions as the Secretary may prescribe to 
parents, legal guardians, fiduciaries, or persons having the control 
and custody of the minor, or to the minor directly, under a written 
plan approved by the Secretary. The Secretary may modify an approved 
plan whenever he/she deems modification to be in the best interest of 
the minor.
    (2) A minor's per capita share of a tribal judgment award, 
including accrued interest, shall be disbursed in accordance with the 
congressionally approved distribution plan and 25 CFR Sec. 87.10.
    (b) Adults under legal disability. The funds of an adult who is non 
compos mentis or under other legal disability shall be disbursed in 
amounts deemed by the Secretary to be in the best interest of the 
adult. Disbursements shall be made for the adult's support, health, 
education, and/or welfare. Funds shall be disbursed upon such 
conditions as the Secretary may prescribe to legal guardians, 
fiduciaries, or persons having the control and custody of the adult; or 
to the adult directly, under a written plan approved by the Secretary. 
The Secretary may modify the approved plan whenever he/she deems 
modification to be in the best interest of the adult.
    (c) Accounts in need of assistance. The funds of adults who are not 
non compos mentis or under other legal disability, whom the Secretary 
finds to be in need of assistance in the management of their affairs, 
may be disbursed on the basis of an approved written plan containing 
terms and conditions requested by the adult or prescribed by the 
Secretary.
    (1) Disbursement plans are authorized to protect the interests of 
the elderly, handicapped, addicted, imprisoned, children, and spouses 
affected by divorce or separation or those who suffer other social or 
physical problems and impairments.
    (2) When this action is taken at the written request of the account 
holder, he/she shall authorize the Secretary to waive all terms and 
conditions in emergencies where the account holder may become unable to 
nullify them because of illness or incapacity.
    (3) The Secretary or authorized representative may modify an 
approved plan wherever it is deemed in the best interest of the adult, 
but shall record all such changes.
    (4) All disbursement plans shall be supported by a social services 
summary and recommendation, approved by the Secretary, justifying the 
determination of need. The recommendation will be maintained in the 
account holder's social services case file.
    (d) Whereabouts unknown. The IIM account of an account holder whose 
whereabouts are unknown shall be supervised until closed pursuant to 
Sec. 115.4. Agency supervision of the account shall include continuing 
and diligent search for the account holder and shall be done with 
oversight and assistance from the Office of Trust Funds Management.
    (e) Deceased other than Five Civilized Tribes and the Osage Tribe. 
The account of a deceased Indian other than those of the Five Civilized 
Tribes and the Osage Tribe shall be supervised under 25 CFR 15. Funds 
from the account may be disbursed for:
    (1) Payment of obligations previously authorized, including 
authorized expenses for last illness;
    (2) Authorized funeral expenses;
    (3) Support of dependent members of the family of the decedent in 
amounts deemed necessary to avoid hardship and consistent with the 
value of the estate and the interests of probable heirs;
    (4) Necessary expenses to conserve the estate pending the 
completion of probate proceedings; and
    (5) Probate fees and claims allowed pursuant to part 15 of this 
chapter.
    (f) Deceased--Five Civilized Tribes. Funds of a deceased account 
holder who was a member of one of the Five Civilized Tribes may be 
disbursed for: payment of ad valorem and personal property taxes; 
obligations approved by the Secretary prior to the death of the account 
holder; expenses of last illness and burial; claims found to be just 
and reasonable that are not barred by the statute of limitations; the 
cost of determining heirs to restricted property or funds by the State 
courts; and claims allowed pursuant to 25 CFR 16.
    (g) Restorations and deposits to general fund. The following types 
of funds and accrued interest shall be restored to tribal ownership or 
deposited to the general fund of the Treasury in accordance with 25 USC 
164, 165:
    (1) Unclaimed per capita shares or other distributions; and
    (2) Individualization, segregation, or proration of Indian tribal 
or group funds redeposited to an individual's IIM account and held in 
trust by the United States for a period of six years from the date of 
the administrative directive to make the payment.
    (h) Sale of capital assets. Funds of an adult that are derived from 
the sale of capital assets shall be expended only for those specific 
purposes agreed to and approved by the Secretary prior to sale. The 
proposed use plan will normally be presented in conjunction with an 
application for sale of trust property submitted for approval.
    (i) Creditor claims. In accordance with Sec. 115.11, funds may not 
be disbursed to satisfy creditor claims against an account holder for 
purposes not approved in advance by the Secretary, except as provided 
in Sec. 115.7(b).


Sec. 115.9  Statement of IIM account.

    (a) Statements of IIM accounts shall be provided to account 
holders, at least quarterly. An account holder may request current 
account status reports at any time at his/her Agency office.
    (b) Statements of IIM accounts for minors and non compos mentis or 
otherwise legally disabled adults, shall be furnished to parents, legal 
guardians, fiduciaries or persons having control and/or custody of the 
account holder, or to the account holder directly, under a plan 
approved by the Secretary.
    (c) A separate explanation shall be provided to an account holder 
at the time of disbursement of oil and gas royalties from the account. 
An account holder may request further explanation and assistance on oil 
and gas disbursements at any time at the Agency office.


Sec. 115.10  Tax requirements.

    (a) The Secretary shall comply with all applicable reporting 
requirements of the Internal Revenue Service and the various States.
    (b) The Secretary is authorized to meet all filing requirements of 
the Internal Revenue Service and the various States for and on behalf 
of supervised account holders.


Sec. 115.11  Assignment of income.

    (a) Any assignment of future trust income shall require a 
contractual agreement to be executed between a non-Federal/tribal 
creditor and an account holder. The assignment agreement shall be made 
at the time a loan arrangement is consummated. The agreement shall be 
approved by the Secretary in advance of the receipt of the income into 
the account.
    (b) Future income obligated under an approved agreement shall be 
disbursed only in accordance with the terms of the agreement, subject 
to any deductions specifically authorized or directed by acts of 
Congress or modifications thereof. An approved agreement can be 
withdrawn or modified prior to fulfillment only with the approval of 
the Secretary. Assignments of income shall be administered in 
accordance with the provisions of Sec. 103.33.


Sec. 115.12  Notice and hearing.

    (a) If, under Sec. 115.7(b), (d) (e) or (f) or Sec. 115.8(b), (c), 
or (d), the disbursement of funds to an account holder is restricted, 
or it is proposed that these funds be used to pay creditors, the 
account holder must be notified in writing as follows:
    (1) Notice must be given at the commencement of the restrictions or 
at least 40 calendar days prior to the proposed disbursement of funds 
from the IIM account.
    (2) The notice must state the reasons for the restrictions or 
proposed disbursement.
    (3) The notice shall inform the account holder of the right to a 
hearing and that a written request for a hearing must be received by 
the Secretary within 30 calendar days of the account holder's receiving 
the notice of the proposed action.
    (4) The notice of proposed action shall be delivered to the account 
holder in person, by Certified Mail-Return Receipt Requested, or if 
this is not possible, it shall be published in a newspaper of general 
circulation likely to be accessible to the account holder. The date 
indicating delivery of the notice, which shall commence the 40 or 30 
day periods, shall be confirmed by one of the following:
    (i) Signed receipt;
    (ii) Affidavit of delivery; or
    (iii) Publication in a newspaper of general circulation if personal 
delivery cannot be made.
    (5) The notice shall include a statement of the rights listed in 
paragraph (c) of this section.
    (6) The notice shall advise that, if the account holder wishes to 
have the delinquent debt or money judgment paid without delay and 
without a hearing, he/she can sign a form furnished with the notice.
    (7) If the amount of funds in account holder's IIM account exceeds 
the amount to be disbursed in accordance with the notice, the excess 
shall be disbursed to the account holder without delay.
    (b) If the account holder fails to request a hearing within 30 
days, he/she is deemed to consent to the restrictions on the 
disbursement of funds from the IIM account and to the disbursement, if 
any, in accordance with the notice.
    (c) The Secretary shall conduct a hearing, if requested as 
specified above, to determine whether to continue the restrictions on 
disbursement, and/or allow disbursements in accordance with the notice. 
The following are requirements for a fair and equitable hearing in 
accordance with 25 USC 164, 165:
    (1) The hearing shall be held within ten (10) working days of the 
Secretary's receipt of the account holder's request for a hearing.
    (2) The account holder shall be given the opportunity to be heard 
orally and/or in writing.
    (3) The account holder shall be allowed: to hear the case for the 
proposed action; to present testimony, arguments, and evidence; to 
present witnesses, and to question and rebut opposing witnesses.
    (4) The account holder may be heard on why the restrictions on 
disbursement, and/or disbursement in accordance with the notice, should 
not be made. The account holder may not re-litigate the facts and 
circumstances giving rise to the restrictions on his/her IIM account.
    (5) The account holder may retain an attorney or other 
representative at his/her expense.
    (6) The decision to uphold or overturn the proposed action shall be 
made by the Secretary and must be based upon information presented or 
referred to at the hearing.
    (7) The Secretary shall make provisions for recording the hearing 
and shall preserve the record for the duration of any applicable appeal 
process. Tape recording the hearing is sufficient.
    (8) The decision of the Secretary shall be provided in writing to 
all parties concerned within ten working days following the hearing.
    (d) No funds, except as provided in subsection (b) of this section, 
shall be paid or disbursed from an IIM account or applied against a 
debt, or a judgment of a tribal court or court of Indian offenses, 
until the decision has become final in accordance with the appeal 
procedures provided for in Sec. 115.14.


Sec. 115.13  Assets of members of the Agua Caliente Band of Cahuilla 
Indians.

    (a) The Secretary is authorized, in his/her discretion, to invest 
funds of members of the Agua Caliente Band of Cahuilla Indians in 
accordance with 25 U.S.C. 954(e).
    (b) The provisions of this section apply to money or other personal 
property held by the United States in trust for members of the Agua 
Caliente Band of Cahuilla Indians, which, with the consent of its 
members, may be used, advanced, expended, exchanged, deposited, 
disposed of, invested, and reinvested by the officer in charge of the 
Palm Springs office, Bureau of Indian Affairs, in accordance with 25 
U.S.C. 954(e). Consent shall not be required if the Secretary 
determines a member to be incompetent by reason of minority or 
otherwise, or where the estate of a deceased member remains unprobated.
    (c) An adult member of the Agua Caliente Band shall be presumed 
competent unless and until proven incompetent in accordance with the 
procedures in this section.
    (1) When the Secretary believes, based upon relevant and reliable 
evidence, that an adult member of the Agua Caliente Band is incompetent 
to participate in the management of funds, the Secretary shall request 
the Director, Office of Hearings and Appeals, to appoint an 
Administrative Law Judge to conduct a hearing for the purpose of 
determining the competency of the member.
    (2) At the same time the hearing request is made to the Office of 
Hearings and Appeals, the Secretary shall provide notice to the member 
that a hearing is being requested. The notice shall be in writing and 
shall be served on the member, personally or by certified mail. The 
Secretary shall assist the member in preparing for the hearing, and 
shall assist him/her to retain an attorney, at the member's expense, if 
he/she wishes to be represented by counsel.
    (3) The Administrative Law Judge shall conduct a hearing in the 
State of California within sixty days of the date of notice, unless the 
member requests and/or consents to a reasonable alternative place and/
or date. The hearing shall be conducted in accordance with the 
requirements of the Administrative Procedure Act, 5 U.S.C. 554. The 
burden of proving incompetency of the member shall be on the Secretary.
    (4) Within 30 days after the hearing, the Administrative Law Judge 
shall submit a recommended decision as to the member's incompetency and 
shall transmit it, together with the record of the proceedings, 
including the hearing transcript, to the Board of Indian Appeals. 
Within 90 days of receipt of the recommended decision and record, the 
Board of Indian Appeals shall render a decision on the member's 
competency, based upon federal law, which shall be final for the 
Department of the Interior.
    (5) Following a final Departmental determination that a member is 
incompetent, the member's consent shall not be a condition to the 
Secretary's use, advance, expenditure, exchange, deposit, disposal, 
investment, or reinvestment of the member's funds.
    (d) Investments made by the Secretary shall be limited to those 
investments of principal and interest that are guaranteed by the United 
States as provided in 25 U.S.C. 162a.
    (e) The investment of funds in a deceased member's estate account 
shall be limited to periods of one year or less.


Sec. 115.14  Appeals.

    Appeals from an action taken by an official of the Bureau of Indian 
Affairs may be taken pursuant to 25 CFR Part 2, subject to the terms of 
Sec. 115.12 where applicable.
Ada E. Deer,
Assistant Secretary--Indian Affairs.
[FR Doc. 94-19860 Filed 8-12-94; 8:45 am]
BILLING CODE 4310-02-P