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F I S C A L I M P A C T R E P O R T

SPONSOR Begaye

DATE TYPED 02/23/05 HB HJM 39

SHORT TITLE Settle Cobell v. Norton Lawsuit

SB

ANALYST Weber

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Indian Affairs Department

SUMMARY

Synopsis of Bill

House Joint Memorial 39 (HJM 39) requests the United States Government to settle the

Cobell v. Norton class action lawsuit.

Significant Issues

The following was supplied by the Indian Affairs Department.

The class action lawsuit was originally filed in 1996 by lead plaintiff Elouise Cobell, who

had tried for years to get an accurate accounting of funds held in trust by the U.S. gov-

ernment for individual Indian-owned land that had been leased by the federal government

for mining, grazing, oil and gas exploration and other uses. In two separate trials, a fed-

eral judge found that the U.S. Department of the Interior and the U.S. Treasury engaged

in “fiscal and governmental irresponsibility in its purest form” in maintaining and ac-

counting for the trust assets belonging to 500,000 individual Indians (allottees), owning

individual Indian allotments.

House Joint Memorial 39 -- Page 2

New Mexico is among the top three states in percentage of land belonging to Indians,

with more than eight 8 million mineral and surface acres that lie on Indian trust land un-

der the trusteeship of the Secretary of the Interior. Few states will be as affected as New

Mexico by the outcome of the litigation because the dollar values of the Individual Indian

Money (IIM) trust accounts for New Mexico individual allottees (from the Navajo Na-

tion, Jicarilla Apache and Laguna Pueblo) are higher than Indians in other states, espe-

cially for Navajos (4000 allotments totaling 694,374 acres). The broken system allows

Indian allottees to receive far less than fair market value for the use of land and resources.

For example, in eastern NM, for every dollar that a Navajo allottee receives in oil and gas

revenues, their non-Indian counterpart receives ten dollars. Jicarilla Apache is the single

largest mineral owner in the basin, excluding the U.S. government. During more than 35

years of gas and oil activity on the reservation, over 2,700 wells were drilled. The 1993

production from 2,200 actives wells was nearly 900,000 barrels of oil and 30 cubic feet

of gas.

The plaintiffs in Cobell are among the poorest citizens in the U.S. After nine years of

litigation and numerous courtroom victories, not one of the estimated 500,000 IIM trust

accounts has been certified.

In August 2004, Indian Affairs Department Cabinet Secretary and members of the Cobell

litigation team met with IIM account holders in the Nageezi Chapter of the Navajo Na-

tion for a one day discussion session. The Secretary and members of the litigation team

heard concerns of the account holders and gave an update on the status of the litigation

and toured the chapter area to view the problems experienced by the allottees, including

the open and exposed pipelines near the homes located on individual allotments. It was

clear from the comments received at this meeting that N.M. citizens are suffering at the

hands of the federal government that will not follow through on its trust responsibility.

Several Navajo citizens voiced their opinion that the case must be settled soon. There

were examples given of individuals dying without receiving their fair share of monies

owed to them for the oil and gas that is pumped from their land. The litigation team indi-

cated that the U.S. Department of Interior was utilizing every possible stall tactic avail-

able and not negotiating a settlement in good faith with the plaintiffs.

HJM 39 could provide support to the plaintiffs in the case, which includes 4,697 individ-

ual allotments made to the Jicarilla Apache tribal members, totaling 1,072,220 acres, and

4,000 allotments to Navajos, totaling 694,374 acres in eastern New Mexico.

MW/lg