$3.4B Indian settlement stuck in Senate filibuster

Caught in the Senate filibuster of a bill to extend unemployment payments is a $3.4 billion government settlement with hundreds of thousands of American Indians over claims that the Interior Department mismanaged their land trust accounts.

Congress must authorize the Obama administration to enter into the class-action settlement 14 years in the making with between 300,000 and 500,000 Indians who have land held in trust by the Bureau of Indian Affairs.

The House gave its approval in May. But the settlement authorization is tucked into the Democrats' jobs-agenda legislation that fell three votes short of breaking a Republican filibuster in the Senate on Thursday, and now the future of the hard-fought agreement is in doubt.

The Blackfeet Indian woman who filed the lawsuit in 1996 said to come this far only to be stymied by what appears to be an unrelated partisan fight is frustrating.

"It's a feeling like you're walking on a cloud and you don't know when you're going to fall. I had such anticipation that the Senate was going to do the right thing," Elouise Cobell of Browning said Friday. "I think the cloud fell last night. I realized just how vulnerable you are when you have to have your life determined by politicians."

The Senate's action - or lack of it - leaves the Indian plaintiffs and the Obama administration with little choice but to wait and see if the Democratic leadership can rally support for another push for a vote on the bill after the July 4 holiday.

"The administration is very committed to passing this legislation and will continue to work with congressional leadership to pass it," Interior Department spokeswoman Kendra Barkoff said Friday.

The Interior Department leases out the land it holds in trust for individual Indians and is supposed to pay them the revenue generated into their Individual Indian Money trust accounts, or IIMs.

Cobell and the other plaintiffs claim the Bureau of Indian Affairs have mismanaged those IIM accounts for more than a century, shortchanging the owners of the land several billion dollars. After more than 3,600 court filings and 80 court decisions, the two sides finally reached a settlement in December.

Under the proposed agreement, $1.4 billion would go to individual Indian account holders. Some $2 billion would be used by the government to buy up fractionated Indian lands from individual owners willing to sell, and then turn those lands over to tribes. Another $60 million would be used for a scholarship fund for young Indians.

Lawsuit participants would receive at least $1,500, and many would receive considerably more.

The plaintiffs asked the U.S. Supreme Court on Monday to dismiss a pending appeal on the lawsuit, believing that appeal was moot because the Senate was about to authorize the settlement, plaintiffs spokesman Bill McAllister said.

"We couldn't go via the Supreme Court and Congress at the same time. We opted to go for Congress because we were told that our provision was likely to be approved. It still offers the promise of a quicker resolution of the lawsuit," McAllister said Friday.

If Congress doesn't approve the settlement, the plaintiffs can bring the issues back to the Supreme Court after a final judgment is entered in the case, he said.

Even if the Senate approves the settlement, it must do so without any changes or it may be considered void, both sides say, and that includes an amendment by Sen. John Barrasso, R-Wyo., who has proposed a $50 million cap on lawyer's fees.

Barrasso also has suggested limiting any incentive awards to the lawsuit's named plaintiffs to unreimbursed expenses and setting aside $50 million of the settlement money for certain lawsuit participants who receive "insufficient or unfair" amounts under the settlement's payment formula, among other changes.

On Friday, Barrasso said he would still like to see the Senate accept his amendment and finalize the settlement, but suggested it may have to be separated from the larger bill that failed Thursday.

That bill would have provided $16 billion in new aid to states and included dozens of tax breaks sought by business lobbyists and tax increases on domestically produced oil and on investment fund managers.

Cobell said the money in the settlement belongs to the Indians and should not fall victim to a dispute over something else altogether.

"We're just a tiny, tiny piece of it. I don't really know what's going to happen next," Cobell said. "We're not going to give up, that's for sure."