**Status Report to the Court**

**Number Twenty-Three**

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# For the Period

**July 1, 2005 through September 30, 2005**

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## **November 1, 2005**

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**TABLE OF CONTENTS**

[**I.** **INTRODUCTION** 1](#__RefHeading___Toc118515790)

[**II.** **SECRETARY GALE NORTON'S OBSERVATIONS**
2](#__RefHeading___Toc118515791)

[**A.** **INFORMATION TECHNOLOGY** 4](#__RefHeading___Toc118515792)

[**B.** **CADASTRAL SURVEY** 13](#__RefHeading___Toc118515793)

[**C.** **MINERALS MANAGEMENT SERVICE**
15](#__RefHeading___Toc118515794)

[**D.** **OFFICE OF HISTORICAL TRUST ACCOUNTING**
16](#__RefHeading___Toc118515795)

[**III.** **OFFICE OF THE SPECIAL TRUSTEE FOR AMERICAN INDIANS**
19](#__RefHeading___Toc118515796)

[**A.** **TRUST REVIEW AND AUDIT** 21](#__RefHeading___Toc118515797)

[**B.** **OST-OFFICE OF THE CHIEF INFORMATION OFFICER**
23](#__RefHeading___Toc118515798)

[**1.** **RECORDS MANAGEMENT** 23](#__RefHeading___Toc118515799)

[**C.** **TRUST ACCOUNTABILITY** 26](#__RefHeading___Toc118515800)

[**1.** **TRUST BUSINESS PROCESS MODELING**
26](#__RefHeading___Toc118515801)

[**2.** **TRUST DATA QUALITY AND INTEGRITY**
28](#__RefHeading___Toc118515802)

[**3.** **INDIAN FIDUCIARY TRUST TRAINING PROGRAM**
30](#__RefHeading___Toc118515803)

[**4.** **RISK MANAGEMENT** 32](#__RefHeading___Toc118515804)

[**5.** **REGULATIONS, POLICIES AND PROCEDURES**
33](#__RefHeading___Toc118515805)

[**D.** **FIELD OPERATIONS** 35](#__RefHeading___Toc118515806)

[**1.** **APPRAISAL** 35](#__RefHeading___Toc118515807)

[**E.** **TRUST SERVICES** 38](#__RefHeading___Toc118515808)

[**1.** **CURRENT ACCOUNTING ACTIVITIES**
38](#__RefHeading___Toc118515809)

[**IV.** **BUREAU OF INDIAN AFFAIRS** 43](#__RefHeading___Toc118515810)

[**A.** **TRUST REGULATIONS, POLICIES AND PROCEDURES**
43](#__RefHeading___Toc118515811)

[**B.** **FRACTIONATION** 45](#__RefHeading___Toc118515812)

[**C.** **PROBATE** 47](#__RefHeading___Toc118515813)

[**ACRONYMS AND ABBREVIATIONS** 49](#__RefHeading___Toc118515814)

I.  []{#__RefHeading___Toc118515790 .anchor}**INTRODUCTION**

This *Status Report to the Court Number Twenty-Three* (Report)
represents the period from

July 1, 2005, through September 30, 2005. The Report is presented for
the purpose of informing the Court on the progress of trust reform
activities occurring during this reporting period, and progress of the
historical accounting of individual Indian beneficiary funds managed by
Interior.[^1]

This Report is prepared in a manner consistent with previous reports to
the Court. Each manager in charge of an area of trust administration and
the director of the historical accounting project are submitting reports
on the progress of their respective activities.

The Court's attention is directed to the revised format of the OHTA
report. The report is significantly reduced in size from previous
reports, largely as a result of eliminating several tables. These tables
have been used in the past to distinguish between types of accounts
being reconciled. The report continues to present in text form the
progress of the accounting and related activities during this quarter.

A glossary of acronyms and abbreviations is included in this Report. The
glossary is located at the end of the Report.

II. []{#__RefHeading___Toc118515791 .anchor}**SECRETARY GALE NORTON'S
    OBSERVATIONS**

As this quarterly report details, trust management improvements continue
to be made at local and regional offices of the Bureau of Indian
Affairs. Conversion of systems and business process improvements
required in the Fiduciary Trust Model are reportedly now in progress at
several more BIA agencies in addition to the pilot agencies. FTM
initiatives such as the lockbox for collection of funds due
beneficiaries, the call center offering beneficiaries access to
information about their accounts and land status, the placement of trust
officers at BIA agencies and many other innovations provide greatly
enhanced services and accountability for beneficiaries.

Implementation of the FTM includes conversion of many stand-alone trust
systems to new interactive systems at all BIA agencies and regions. This
requires BIA agency superintendents to rely on new BIA and Interior
computer systems to accomplish work that was formerly done through the
use of independent local operating systems. The new systems and business
processes are designed to have information encoded on a "real-time"
basis. Bringing data current in legacy systems in order to convert to
new systems requires thousands of hours of contractor support and
rigorous quality control. As the FTM is installed throughout the
agencies, we are certain to encounter new challenges. The Special
Trustee has estimated this work will consume most of the next two years
to accomplish. However, our goal of operating in a modern IT environment
with consistent practices across all agencies and regions will
ultimately improve the overall management of the trust.

As previously reported, Interior is engaged in a significant regulatory
initiative to bring our trust and trust-related regulations into
compliance with changes in the law and update those regulations that are
part of the implementation of trust improvements. This is a significant
project that we expect to be completed after consultation is conducted
with tribes and the regulations are adopted.

During this reporting period, appropriations for FY2006 were passed by
Congress. We did not receive the full amount we requested for historical
accounting. Congress appropriated only \$58 million, and indicated that
the difference between our request and the appropriated amount was
allocated to other Indian affairs and Indian health programs. The
remaining requests for funding trust programs in Interior were left
intact. However, as a result of the limited funding for the second year
in a row, the historical accounting project will necessarily be extended
beyond the initially projected completion date.

On July 26, 2005, the Senate Indian Affairs Committee held a hearing on
S. 1439, proposed legislation (sponsored by Senators McCain and Dorgan)
to legislatively resolve issues regarding the individual Indian trust.
Special Trustee Ross Swimmer and Associate Deputy Secretary Jim Cason
testified for the Department. They noted that "the introduction of S.
1439 is the first serious Congressional effort we have seen to
comprehensively resolve the issues involved in the Cobell lawsuit. While
many details remain to be negotiated and clarified, the bill represents
an important step towards bringing the parties together for a meaningful
effort to seek closure on this matter." Other witnesses represented
tribes and the [Cobell v. Norton]{.underline} plaintiffs. There has not
been any formal action on this bill.

I have been informed that, as of September 30, 2005, the Office of
Historical Trust Accounting had fully reconciled an additional 6,538
judgment and per capita accounts (including some with no current
balance). As I mentioned in the last quarterly report, OHTA is awaiting
permission from the Court to send the results to 28,107 account holders.
A submission to the Court for authorization to mail the results of these
account reconciliations was filed on March 24, 2005.

During this reporting period, Interior prepared *Historical Accounting
for Individual Indian Monies: A Progress Report,* highlighting
Interior\'s historical accounting progress in several areas. The
*Progress Report* notes that Interior has consolidated, indexed, and
stored over 120,000 boxes of records at the state-of-the-art American
Indian Records Repository in Lenexa, Kansas, preserving the records
effectively while keeping them accessible and searchable. OHTA reported
that it has reconciled over 17,000 transactions in land-based IIM
accounts, including over 99% of transactions sampled in the Litigation
Support Accounting project. Based on a report dated September 30, 2005,
from NORC, the statistical consultant, these numbers should be
sufficient to allow statistically valid conclusions to be drawn; namely,
about 1% of all deposit and disbursement transactions from 1985 through
2000 are different from the expected amount, and posting errors
constitute less than 1% of the dollars reconciled. The *Progress Report*
also noted that Interior has reconciled over 53,000 Judgment and per
capita IIM accounts, has mailed more than 12,000 historical statements
of account to judgment IIM account holders, and has distributed over
\$36 million in residual balances from special deposit accounts.

I am told by our security experts that every Internet based system is
vulnerable to threats of hackers as well as other malicious activity.
Certainly, one of my goals has been to reduce the threat to our systems.
As part of that commitment, Interior bureaus and offices continue to
have their computer systems examined and challenged for security by the
Office of the Inspector General, outside contractors and their own
internal security analysts. From this testing, I hope our
vulnerabilities can be identified and corrected. While I am encouraged
by the improvements during the past four years, I recognize that risks
remain, not only to Indian trust data, but to Interior systems
generally. However, in spite of these risks, we also have to conduct
day-to-day operations. While risks are being eliminated, these risks can
also be mitigated in order to allow systems to operate. Our challenge is
to adequately protect systems within limits of our budget and other
constraints.

During this reporting period, NARA disclosed to Interior that certain
records under the legal and physical custody of NARA as the permanent
records of the United States, including some Indian related records,
were found in trash containers at the National Archives building in
Washington, D.C. NARA officials have advised us that this matter has
been referred to their Inspector General for investigation. While these
records are under neither my control nor the control of anyone else at
Interior, I am concerned about the potential loss of such records and
will be monitoring the situation as information from NARA becomes
available.

A.  []{#__RefHeading___Toc118515792 .anchor}**INFORMATION TECHNOLOGY**

**[Introduction]{.underline}**

This section describes the status of Interior IT systems, particularly
the systems that house or provide access to IITD or provide various
computing capabilities, including functions critical to the proper
administration of the individual Indian trust responsibilities within
Interior. In addition, this section describes various efforts being made
to improve IITD security within Interior, pursuant to OMB Circular A-130
Appendix III, and the status of Internet connectivity.

**[Accomplishments and Completions]{.underline}**

**Computer Security:**

Interior continues to make progress in ensuring IT security. A primary
focus for this reporting period has been implementing corrective actions
for weaknesses identified by the Interior penetration tests and audit of
financial systems. Additional efforts were focused on:

-   Performing continuous monitoring of Internet-accessible systems;

-   Preparing submission of the annual FISMA report;

-   Conducting annual IT security awareness and role-based training;

-   Submission of annual assurance statements required to complete the
    annual PAR; and,

-   Continuing to validate and improve the C&A packages completed
    previously.

> The most noteworthy accomplishments and completions during the
> reporting period are described below.

***Prevention and Monitoring***

-   Interior continued its extended vulnerability scan testing of
    Internet-accessible systems. The extended testing checks for
    approximately 7,400 different types of vulnerabilities, in addition
    to the SANS Top 20 vulnerabilities of previous testing. Since the
    last reporting period, Interior tested over 5,000
    Internet-accessible network devices (for example, servers, routers,
    switches.) Initial results from January to April 2005 indicated over
    5,000 potential vulnerabilities, but included many false positives
    and duplications. By the end of this reporting period, potential
    vulnerabilities were substantially reduced. This reduction results
    from routinely scanning network devices for potential
    vulnerabilities and working toward correcting or mitigating
    identified weaknesses. 121 vulnerabilities remained and continued to
    be mitigated as of the end of the reporting period.

-   Potential incidents that were reported to DOI-CIRC during this
    reporting period include 22 successful incidents. None appears to
    have resulted in any known compromise of IITD. Successful incidents
    are those that were not prevented or blocked by Interior at the time
    of their occurrence.

-   OIG completed a FISMA documentation review for OST, with no
    deficiencies noted during the review. The draft or final report has
    not been received.

-   BLM conducted two significant, separate table-top contingency
    exercises of MAs and the enclave GSS. BLM conducted an exercise of
    the ALIS contingency plan on August 9, 2005. Multiple other MAs
    participated in a contingency plan exercise on September 14, 2005.

-   As reported to the court on September 2, 2005, a limited amount of
    IITD was discovered in BLM's LR2000 database on August 18, 2005.
    Internal access to LR2000 was immediately blocked. A data quality
    review was conducted by BLM. All IITD was removed from LR2000. The
    security module was modified to include access disclaimers requiring
    users to refrain from using LR2000 for any Indian trust-related
    work. Additional scans were completed on August 24, 2005. BLM's DAA
    approved access restoration on an internal basis as of August 26,
    2005.

-   MMS conducted monthly network vulnerability scans on internal
    servers and network devices. Due to the hurricane impacts to the
    Gulf of Mexico, including severe damage to MMS facilities, limited
    remediation occurred for the August and September scan results. The
    tracking system in New Orleans was not restored until after the end
    of the reporting period.

-   As reported to the Court on August 25, 2005, MMS detected an
    unauthorized change of an administrator password on the MRMSS
    externally-hosted portal in August 2005. The incident is still under
    investigation with the OIG and FBI. Based upon the investigation to
    date, there is no reason to believe the integrity of any data was
    compromised. Changes have been made to increase event monitoring at
    both the perimeter firewalls and application. Security scans of the
    application have been conducted, additional scans are scheduled.
    Final security scans and a security review are expected to be
    conducted by an independent third party contractor.

-   NBC initiated remediation activities to address vulnerabilities
    identified in the second OIG penetration testing conducted on NBC
    systems in July. Personnel data was accessed, in the course of
    testing NPS systems. Immediate action was taken on critical
    vulnerabilities and NBC continues to track progress of remaining
    tasks from both penetration testing exercises.

***Policies and Guidance***

-   The Interior CIO issued OCIO Directive 2005-012, "Wireless Network
    Security," to the bureau and office chief information officers on
    July 29, 2005. This directive outlines the security requirements for
    wireless networking devices within Interior and requires adherence
    to "Wireless Security Technical Implementation Guide," Version 2.0,
    July 21, 2005. The CIO also approved the "DOI Wireless Data
    Communications Strategy" on August 3, 2005.

-   The Interior CIO issued a memorandum, "Implementing OCIO Directive
    2005-007 for 4^th^ Quarter Plans of Action and Milestones (POA&M)
    and 4^th^ Quarter Federal Information Security Management Act
    (FISMA) Performance Measures," to the heads of bureaus and offices
    on August 18, 2005. This memorandum provides guidance in completing
    POA&Ms and FISMA performance measures in accordance with OMB
    requirements and Interior OCIO Directive 2005-007.

-   The Interior CIO issued a memorandum, "External Vulnerability Scans
    -- MCI Service," to the Deputy Secretary, assistant secretaries and
    heads of bureaus and offices on September 12, 2005. This memorandum
    outlines the vulnerability scanning program conducted by MCI. It
    requires bureaus to address systems with critical vulnerabilities
    first, and to isolate from the Internet vulnerable systems or
    services until the issue can be resolved, if the vulnerabilities can
    not be immediately remediated or identified as false positives.

-   The Interior CIO issued a memorandum, "Temporary Approval of
    Wireless Technologies Waiver Requests to Support Emergency Efforts,"
    to the assistant secretaries and heads of bureaus and offices on
    September 23, 2005. This memorandum provides specific criteria and
    conditions regarding the use of wireless technologies or access to
    non-Interior provided wireless networks to enable efficient
    implementation of the Federal National Response Plan.

-   The Interior CIO issued OCIO Directive 2005-015, "Information
    Technology (IT) Audit Findings and Corrective Actions," to the heads
    of bureaus and offices on September 26, 2005. This directive
    supplements existing policies and guidance to improve the overall
    quality of IT audit findings and responses.

***Training and Awareness***

-   Overall, 98% of Interior employees and contractors who use or access
    Interior computer systems completed the Interior FY2005 required
    annual end user Federal information systems security awareness
    training. 66% of employees with significant IT security
    responsibilities received specialized training, as described in NIST
    Special Publication 800-16 *Information Technology Security Training
    Requirements: A Role- and Performance-Based Model*.

    -   All required BLM, MMS, SOL, OHA, Office of the Secretary and
        Office of the Assistant Secretary -- Indian Affairs employees
        and contractors completed the end user training. 98% of the
        required OST employees and contractors completed the Interior
        FY2005 annual training. 97% of BIA staff completed the training.
        The remaining BIA staff who did not receive training (289 Indian
        Education employees) do not require computer access, or left BIA
        employment prior to the reporting deadline.

    -   The BLM, MMS and OHA employees and contractors with significant
        IT security responsibilities received specialized training. 97%
        of Office of the Secretary, 66% of SOL and 58% of OST employees
        with significant IT security responsibilities received
        specialized training

-   In September 2005, the Deputy Assistant Secretary -- Indian
    Affairs/CIO sponsored three workshops on recent and evolving NIST
    security requirements, specifically covering FIPS 199 and NIST SP
    800-53 guidance for system characterization and for selecting
    appropriate security controls. A total of 50 BIA and other Interior
    bureau staff (including both Federal employees and contractors)
    attended the three sessions offered.

-   The quarterly Fall 2005 MMS Information Security Awareness
    Newsletter was distributed to MMS employees and contractors on
    September 23, 2005, to keep users abreast of IT security issues.

**Plans of Action and Milestones:**

Interior tracked 1,730 POA&M recorded weaknesses, of which 529
weaknesses were identified this quarter and 1,201 (reported incorrectly
in the previous status report as 1,206 due to a data transposition
error) weaknesses were carried over from the third quarter. Interior
remediated and closed out 416 weaknesses this quarter. Interior is
currently tracking 1,314 open weaknesses. All bureaus and offices with
trust systems certified the completion of POA&M corrective actions.

**A-130 Certification and Accreditation:**

Ninety-eight percent of Interior systems have full authority to operate
(ATO) status. The C&A packages for all of those systems have been
reviewed by a qualified third party for compliance with A-130 standards
and requirements. 74% of the reviewed packages received passing scores.
C&A packages that had not met minimum compliance review scores on
initial reviews continue to be improved.

OST completed an update of its IT contingency plan, its disaster
recovery plans for 5 minor applications running within OSTNet, and its
SSP for OSTNet. OST updated its ST&E Guide for OSTNet to incorporate
FIPS 199 and NIST SP 800-53 requirements. OST evaluated OSTNet using the
updated ST&E, which resulted in an update to the OSTNet risk assessment.
OST conducted a table-top disaster recovery and continuity of operations
exercise.

Due to the recent implementation of Active Directory and new security
controls, OHA initiated a re-certification and accreditation of OHANet.
As part of this process, OHA validated the information types,
information security categorization, and corresponding system
characterization.

SOL completed its first C&A and received full authority to operate
SOLNet.

**IT Systems Architecture:**

Interior completed a Departmental Solution Development Life Cycle
document, which more tightly couples EA, CPIC, and security requirements
during development or acquisition of IT systems.

EA is dynamic. As systems are deployed and others are decommissioned,
the architecture changes. Therefore, the updating, population and
maintenance of the DEAR is a continual process that occurs every
quarterly reporting period. Bureaus are required to keep the repository
accurate and current.

***DOI Land and Resource Management System (DLRM)***

As previously reported, the DLRM system is expected to provide a
long-term solution for the legacy functionality of the CGI leasing
software module, formerly a part of the TAAMS project. A
pre-solicitation notice for DLRM was published on August 21, 2005, but
the solicitation was subsequently cancelled. In order to go forward with
the project, functional requirements for all Interior land and resource
management mission areas need to be validated to define a comprehensive
enterprise capability and funding strategy.

**ESN:**

-   MMS completed the connection to the ESN Internet gateway for the
    Herndon, VA, and Denver offices this reporting period. The New
    Orleans Regional Office was connected to ESN in mid-October, having
    been delayed due to the recent hurricanes in the Gulf.

-   NBC, NPS and OSM were connected to the ESN Internet gateway this
    reporting period.

**[Current Status]{.underline}**

**ZANTAZ**

-   ZStage refers to a ZANTAZ software indicator which shows whether an
    e-mail message has been properly processed. Interior addressed the
    ZStage issue in a September 11, 2005, filing and at a September 15,
    2005, status conference.

-   During this reporting period, OST discovered a limited processing
    problem identified by reviewing ZStage data and took steps to
    mitigate it. OST is expecting to send 160 tapes to ZANTAZ to recover
    missing data from February 19, 2005, to September 8, 2005. OST
    engaged an independent third party contractor to conduct a complete
    review of the OST electronic mail environment, identify any ZANTAZ
    issues or problems, and develop corrective actions. Receipt of
    analysis reports and corrective actions plans is pending.

-   NBC determined that the incident discovered on June 21, 2005, noted
    in the previous reporting period, will require 419 back-up tapes to
    be sent from DC to ZANTAZ for processing. The incident covered the
    period of August 28, 2004, through August 13, 2005, when a fix was
    implemented. NBC Denver has not yet resolved the incident, but
    estimates 46 back-up tapes will need to be sent for processing.

-   On October 7, 2005, SOL's configuration was corrected by ZANTAZ. All
    messages are now going to the Digital Safe. SOL expects to send 96
    tapes to ZANTAZ to recover missing data from February 22, 2005 to
    October 7, 2005. []{.mark}

-   BIA expects to send 280 backup tapes to ZANTAZ to recover missing
    data from October 25, 2003 through January 27, 2005. Tapes covering
    earlier periods were previously sent to ZANTAZ (the last tape
    processed by ZANTAZ was on October 24, 2003, which included the
    Juneau server.)

-   Tape delivery and subsequent restoration cannot proceed until
    Interior has completed its contract negotiations with ZANTAZ.
    Accordingly, the OCIO cannot at this time estimate a date for the
    delivery of the tapes to ZANTAZ.

**Reports:**

These reports are likely to be of interest to the Court, including
several that were issued following the end of this reporting period.

-   Interior anticipates filing the FISMA report and the OIG annual
    evaluation with the Court in the near future.

-   OIG issued *The Department of the Interior\'s Process to Manage
    Information Technology Security Weaknesses*, Report No.
    A-EV-MOA-0001-2005, on September 23, 2005. OIG recommended that
    Interior declare a material weakness with respect to the POA&M
    process based on its review of POA&Ms from September and
    November 2004. OIG sampled 133 corrective actions that were reported
    as having been completed, and opined that 48% of those actions had
    not been implemented to his satisfaction.

> As noted in this OIG report, the CIO concluded that Interior's
> existing POA&M process is adequate, and that the OIG assessment of
> POA&Ms was based on reviews conducted early in FY2005 and did not
> reflect subsequent improvements implemented to correct noted issues.
> These improvements included requiring additional verification and
> validation of completed corrective actions. For each quarterly POA&M
> submission, bureau and office CIOs review the completed POA&M
> corrective actions, and attest to their implementation prior to noting
> the action as closed on the POA&M.

-   OIG, through its contractor, was unsuccessful in its efforts to
    penetrate the MMS systems. OIG Report *NSM-EV-MMS-0021-2005 MMS
    Penetration Testing* noted that no significant vulnerabilities were
    discovered that would allow penetration into MMS networks or
    unauthorized access to information. MMS is reviewing the final
    report for inclusion of identified weaknesses on the POA&M.

-   As reported to the Court on September 28, 2005, OIG issued the
    results of its Phase 3 penetration testing on September 6, 2005.
    Phase 3, conducted between May and mid-August 2005, included
    penetration testing on FWS, NPS and OSM. The report also included
    the completion of BOR National Critical Infrastructure Information
    Systems reviews. Phase 3 test results show that OIG was not able to
    penetrate FWS and OSM, but that a penetration of NPS allowed testers
    to traverse to NBC's systems without detection. OIG also found that
    "the SCADA systems are operating in relative safety from potentially
    catastrophic cyber-security threats."

-   GAO issued "Information Security: Weaknesses Persist at Federal
    Agencies Despite Progress Made in Implementing Related Statutory
    Requirements" (GAO-05-552). This report is based on agency reports
    of FY2003 and FY2004 and related GAO reports from FY2003 through
    FY2005. Although it notes that the government is making progress in
    implementing FISMA, it finds pervasive weaknesses in information
    security policies and practices across all major agencies. As this
    report assesses the challenges in implementing IT security programs
    government-wide, it may or may not be of interest to the Court.

**[Delays and Obstacles]{.underline}**

There are many challenges that must be addressed regarding the
integration, performance, funding, security, and data integrity of IT
systems generally. Like other federal agencies, Interior must address
these challenges for its IT systems. Interior initiated or completed
steps to address some of the challenges reported in this and previous
reporting periods. However, delays and obstacles listed here impede
progress in achieving Interior's IT management goals:

**Hurricane Katrina**

-   Hurricane Katrina has had severe impacts on resources. Key staff
    members for MMS IT security are based out of the New Orleans office,
    and were unable to work or only able to work sporadically since the
    event. MMS temporarily shut down its computing facility in New
    Orleans. This facility will be restored to service as soon as
    conditions warrant and resources are available. Essential systems
    have been relocated and/or restored at other MMS sites and are
    available. A temporary office was established in Houston that may
    operate for up to one year. The results of these efforts
    demonstrated the workability of the MMS business continuity plan.

**Litigation**

-   Collection and production of documents and court appearances
    continued to place significant strain on available staff and
    contractor resources throughout much of this reporting period,
    resulting in substantial delays in accomplishing planned and
    required work. The extent of the effort required for this document
    production resulted in significant backlogs and rescheduling that
    will hamper Interior's efforts for months to come. Production of
    documents has exceeded 4.5 million pages. This litigation continued
    to impact:

    -   FISMA compliance actions

    -   Interior's financial audit

    -   OMB and Congressional reporting requirements

    -   Migration to a single e-mail messaging system

    -   Migration to a single Active Directory system

    -   Complying with HSPD-12 for implementing E-Authentication in
        Interior

    -   Delay in moving Interior bureaus and offices to a single WAN

    -   Updating Interior policies to fully comply with issued guidance
        and regulations

-   Employee fears about becoming personally implicated in the *Cobell*
    litigation continued to be heightened as individuals from varying
    levels in Interior were required to testify at the evidentiary
    hearing. These fears continue to undermine communication and
    decision-making, and along with burn-out from demands for volumes of
    document production, are contributing factors to low employee
    morale.

**Staffing**

Interior is experiencing high staff and management turnover in critical
IT positions, particularly IT security. For example, the Department's
Chief Information Security Officer resigned on October 11, 2005.
Resulting impacts to communication, efficiency, and oversight are
impeding IT security service area functions.

**Funding and Resources**

-   Considerable expense was incurred as a result of collecting and
    producing over 4.5 million pages of material for the litigation.
    This expense diminished the funding available for security
    improvement and program evaluation.

-   With the significant increase in FISMA reporting required by OIG,
    the resources (time, personnel, and funding) provided for IT
    security-related activities were diminished. Interior continues to
    prioritize its FISMA needs in its budget requests within fiscal
    constraints.

-   Funding availability will continue to dictate the timing of
    IT-related initiatives. Interior's FY2006 budget will require
    managing a variety of IT-related requirements and tradeoffs.

**Denied Internet Access**

-   Several Interior bureaus and offices (BIA, OHA, OST and SOL) have
    not been permitted by the Court to have Internet access since
    December 5, 2001. Lack of Internet access impedes work processes and
    the ability to communicate effectively, both internally and
    externally. For example, lack of connectivity hampers internal
    communication among bureaus providing customer service to individual
    Indians at FIMO located in the BLM Farmington Field Office.

-   Maintaining security on internal systems is more difficult without
    access to the Internet for research, reporting, and patch
    management. Similarly, promulgation of policy and training is
    substantially hampered by the lack of interconnectivity and Internet
    access.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the
Information Technology section of the *Status Report to the Court Number
Twenty-Three*. The information provided in this section is accurate to
the best of my knowledge.

Date: October 31, 2005

Name: *Signature on File*

W. Hord Tipton

Interior Chief Information Officer

A.  []{#__RefHeading___Toc118515793 .anchor}**CADASTRAL SURVEY**

**[Introduction]{.underline}**

Cadastral surveys provide assurance that land boundaries for individual
Indian and tribal trust lands are identified appropriately. By federal
law, surveys of Indian lands are to be performed under BLM's direction
and control. Official surveys, whether preexisting or new, identify the
location of land boundaries of Indian trust assets and determine
official acreage. The official surveys are integral to realty
transactions, resource management activities, litigation support and the
federal system of patent, allotment and survey records maintained by
BLM. Ownership information, distribution of trust assets, and management
of trust accounts may be related to or based upon information recorded
in official surveys.

**[Accomplishments and Completions]{.underline}**

**Educational Opportunity and Outreach**

During this reporting period, BLM and the Oregon Institute of Technology
began an outreach effort with the private sector to support the existing
cooperative partnership. The objective of this partnership is to
emphasize the public land surveying curriculum and to partner with
American Indian Tribes and organizations to promote and encourage survey
education for individual Indians.

**[Current Status]{.underline}**

**Interior Indian Trust Lands Boundary Standards (Draft)**

The Draft Boundary Standards continue to be reviewed and revised based
upon comments received by SOL. Upon completion of SOL review, an updated
draft will be provided to Interior bureaus, offices and other affected
parties.

**Funding of the Recommendations Outlined in the FTM**

During this reporting period, information was developed to justify
funding of the FTM goals as they relate to the four cadastral survey
initiatives. These four initiatives include: (1) funding for the 12 BLM
Indian lands surveyors located in the BIA Regions; (2) creation of the
CFedS program (where state licensed land surveyors can be certified to
perform commercial activities under the direction and control of BLM);
(3) improving the maintenance of the PLSS within Indian Country; and (4)
creation of one standardized source of land status information based on
cadastral data that delineates the official legal land descriptions. BLM
has funding in FY2006 for the regional surveyors and the CFedS program.

The BLM Indian lands surveyors for the Eastern Oklahoma and Great Plains
Regions are hired and have reported to their respective duty locations.
The BLM Indian lands surveyors for the Midwest and Northwest Regions are
actively working with BIA staff and others in addressing survey boundary
issues. The Southern Plains lands surveyor is scheduled to report during
the next reporting period. The remaining seven BLM Indian lands surveyor
positions were advertised at the end of this reporting period and it is
anticipated that these individuals will be selected during the next
reporting period.

During this reporting period, the CFedS project manager position was
filled at the BLM National Training Center. Briefings on the CFedS
project were presented to Interior bureaus and offices.

**[Delays and Obstacles]{.underline}**

**Disconnection from the Internet**

The Court-ordered disconnection from the Internet continues to adversely
impact the way communications are handled between BLM, BIA, OST and SOL,
including the way CARS is being implemented and the review of the
Interior Indian Trust Lands Boundary Standards**.** BLM's productivity
has decreased, and the cost associated with dual networks has caused the
cost of survey services to increase. This issue continues to impact
BLM's ability to provide cadastral services in an effective and cost
efficient manner to clients.

**Funding of the FTM**

Planning and scheduling of out-year FTM work is dependent on future
funding.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Cadastral
Survey section of the *Status Report to the Court Number Twenty-Three*.
The information provided in this section is accurate to the best of my
knowledge.

Date: October 27, 2005

Name: *Signature on File*

Donald A. Buhler

Chief Cadastral Surveyor

Bureau of Land Management

B.  []{#__RefHeading___Toc118515794 .anchor}**MINERALS MANAGEMENT
    SERVICE**

**[Introduction]{.underline}**

Minerals Revenue Management, an MMS program, is responsible for
collecting, accounting for, and distributing mineral revenues from both
federal and Indian mineral leases, and for evaluating industry
compliance with laws, regulations and lease terms. MRM maintains
reported information and distributes revenues at the lease level. BIA
maintains individual Indian ownership records that are used to provide
information to OST for disbursement of the lease revenues to individual
Indian beneficiaries.

**[Current Status]{.underline}**

**Indian Oil Rule**

MMS continued with the rulemaking process for the valuation of oil
produced from tribal and allotted Indian lands. The proposed rule for
valuing crude oil produced from Indian leases now is expected to be
published in January 2006.

**Payment Receipt Date Verification**

As previously reported, MMS completed the PeopleSoft upgrade in January
2005; and as of

July 31, 2005, all software changes were successfully tested and
incorporated into MRM's financial system. With the implementation of the
changes, future errors should be prevented. MMS is working with its
contractor to determine when system modifications can be made that
should allow MMS to identify any prior errors in the Indian mineral
revenue distribution file. Any potential additional interest that may be
due to recipients would be identified upon review and analysis of the
data produced from the system modifications.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Minerals
Management Service section of the *Status Report to the Court Number
Twenty-Three*. The information provided in this section is accurate to
the best of my knowledge.

Date: October 19, 2005

Name: *Signature on File*

Cathy J. Hamilton

Chief of Staff

Minerals Revenue Management

Minerals Management Service

C.  []{#__RefHeading___Toc118515795 .anchor}**OFFICE OF HISTORICAL TRUST
    ACCOUNTING**

**[Introduction]{.underline}**

OHTA was established by Secretarial Order No. 3231 on July 10, 2001, and
is charged with planning, organizing, directing and executing the
historical accounting of IIM and tribal trust accounts.

**[Current Status]{.underline}**

**Judgment and Per Capita IIM Accounts**

OHTA continues to perform historical accounting procedures on Judgment
and Per Capita IIM accounts. OHTA received the electronic IIM
transaction data files it uses for the Judgment and Per Capita IIM
account historical accounting in 2003 from one of its contractors, which
had received the data files directly from OST in 1999; the data files
were received by OHTA from a system that was not connected to the
Internet. Since its 2001 inception, neither OHTA nor its contractors
have stored the data on a system connected to the Internet.

During this reporting period, OHTA completely reconciled an additional
3,852 Judgment IIM accounts and 3,521 Per Capita IIM accounts.

**Mailings to Judgment and Per Capita IIM Account Holders**

A submission to mail 28,107 additional Historical Statements of Account,
filed with the Court on March 24, 2005, is still pending approval.
Consequently, OHTA has not mailed these Historical Statements of Account
during this reporting period.

**Land-Based IIM Accounts**

A Litigation Support Accounting Project for the Electronic Records Era
(1985 -- 2000) for the land-based IIM accounts was begun in 2004. This
Project involved reconciliation work on High-Dollar transactions (those
equal to or in excess of \$100,000) and on a National Sample of
transactions (statistically selected from those under \$100,000) in
Land-Based IIM accounts. A report on this work was delivered to OHTA on
September 30, 2005. Over 99% of the random sample of transactions have
been reconciled to the supporting documentation for all 12 BIA Regions.

The report highlights include:

> **Debits (principally, cash disbursements)**

-   Reconciliation results show the debit difference rate to be 0.4%.
    With an assurance level of 99%, the difference rate for all debits
    is no more than 1.3%. The estimated rate of differences
    disadvantageous to the IIM account holders with an assurance level
    of 99% is 0.7%. This disadvantageous difference rate at a 95%
    assurance level is 0.6%.

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-   With an assurance level of 99%, the estimated dollar exposure for
    debit differences disadvantageous to IIM account holders is no more
    than \$4 million. At a 95% assurance level, the dollar exposure is
    slightly over \$2 million.

> **Credits (principally, cash receipts)**

-   Reconciliation results show the credit difference rate to be 1.3%.
    With an assurance level of 99%, the difference rate for all credits
    less than \$100,000 is no more than 7.0%. The estimated rate of
    differences disadvantageous to the IIM account holders with an
    assurance level of 99% is under 4.0%. This disadvantageous
    difference rate at a 95% assurance level is 3.0%.

-   With an assurance level of 99%, the estimated dollar exposure for
    credit differences disadvantageous to the IIM account holders is no
    more than \$86 million. At a 95% assurance level, the dollar
    exposure is \$42 million.

Statistically, no evidence was found to suggest that under- and
over-payments were different. That is, the under- and over-payments
occur at about the same rate and the distribution of the difference
amount is statistically equivalent (whether the differences were under
or over the recorded amount).

**OHTA SDA Distribution Project**

In previous reports to the Court, the SDA balances remaining to be
distributed included net principal and interest activity that occurred
subsequent to December 31, 2002. The SDA balance reported in *Status
Report to the Court Number Twenty-Two* has been reduced by the principal
receipts (net of disbursements thereof) and interest activity posted to
the OHTA SDA population since January 1, 2003, a total reduction of
\$5,540,163. This change in the basis of reporting will more accurately
reflect the balances remaining to be distributed in the OHTA SDA
Distribution Project.

During this reporting period, 258 SDAs involving \$1,345,082 were
resolved. There remain 11,963 SDAs involving \$20,574,115 to distribute.

**Interest Recalculation**

Interior plans to recalculate expected interest payments for each IIM
account. During this reporting period, OHTA completed an interest
recalculation effort for Alaska Region Land-Based IIM accounts for
transactions occurring during the Electronic Records Era (1985 -- 2000).
Completion of the interest recalculation effort for all Regions will
account for approximately 40% of the total number of transactions in
Land-Based IIM accounts and will help facilitate the identification and
resolution of data gaps in the electronic records.

**Imaging/Coding -- Individual Indian Trust Documents**

During this reporting period, OHTA completed scanning 928,680 pages,
coding 48,349 documents and loading 50,176 documents into the Accounting
Reconciliation Tool.

**[Delays and Obstacles]{.underline}**

Enacted appropriations for FY2003 through FY2005 have been below the
President's requests. This has prevented OHTA from making the progress
it projected in the January 6, 2003, Plan filed with the Court.

**[Assurance Statement]{.underline}**

I concur with the contents of the information contained in the Office of
Historical Trust Accounting section of the *Status Report to the Court
Number Twenty-Three*. The information provided in this section is
accurate to the best of my knowledge.

Date: October 31, 2005

Name: *Signature on File*

> Bert T. Edwards, Executive Director
>
> Office of Historical Trust Accounting

III. []{#__RefHeading___Toc118515796 .anchor}**OFFICE OF THE SPECIAL
     TRUSTEE FOR AMERICAN INDIANS**

**[Introduction]{.underline}**

The Office of the Special Trustee for American Indians was created by
the American Indian Trust Fund Management Reform Act of 1994. The 1994
Act provides direction to the Department of the Interior on accounting
for Indian trust funds and reforming the operation of the Indian
fiduciary trust. The Special Trustee's responsibilities under the Act
include creating a comprehensive strategic plan for the operation of the
trust and providing oversight of the accounting for Indian trust funds
and the reform of the trust. In addition to other trust

reform-related duties assigned by the Secretary, the Special Trustee
accepted the transfer of the Office of Appraisal Services from BIA to
OST.

**[Special Trustee's Observations]{.underline}**

**Trust Initiatives for the 21^st^ Century**

Work was completed at the pilot agencies to enable the first mailings to
beneficiaries of comprehensive account statements as required by the
1994 Act. In addition, a schedule was agreed upon to incorporate the new
systems, to perform quality reviews of information contained in data
files, making corrections where necessary, and to record backlogged
information into the appropriate systems at the remaining BIA agencies,
field offices and LTROs. This effort is expected to be approximately 85%
complete by the end of CY2006, with all agencies fully converted by the
end of CY2007.

Interior Regulatory Initiative working groups continue to draft language
to further the implementation of the FTM, comply with requirements of
AIPRA and streamline business processes. The draft language will be the
subject of various consultation sessions with Tribes and other
stakeholders. This consultation process is expected to begin by the end
of the first quarter of CY2006.

Implementation of the FTM is a massive project. It requires conversion
of systems, upgrading BIA processes and coordinating this work with
other Interior bureaus and offices. When completed, this effort should
result in a much more efficient, accurate and timely processing of
information and in enhanced accountability to trust beneficiaries.

**American Indian Probate Reform Act**

During this reporting period, BIA awarded a grant to a non-profit
organization to develop training courses for attorneys engaged in
writing wills for Indian people with trust assets. This grant also
includes community outreach on estate planning and helping Indian trust
beneficiaries understand AIPRA.

**[Conclusion]{.underline}**

Implementation of the FTM continues on a track to be completed by the
end of CY2007. Promulgating new regulations, recording backlogged
information, and developing new lease forms and business processes (such
as desk operating procedures) are challenging. Nevertheless, it is now
possible to see, almost daily, the improvements to the management of the
trust and interaction with beneficiaries. However, fractionation will be
a continuing problem, requiring expenditures far beyond the revenue
generated from trust assets each year. It is imperative that further
legislative solutions come from Congress to solve the fractionation
problem.

**[Assurance Statement]{.underline}**

The comments and observations are provided by the Special Trustee for
American Indians and reflect the opinion of the Special Trustee only.

Date: October 20, 2005

Name: *Signature on File*

Ross O. Swimmer

Special Trustee for American Indians

A.  []{#__RefHeading___Toc118515797 .anchor}**TRUST REVIEW AND AUDIT**

**[Introduction]{.underline}**

OTRA reports directly to the Special Trustee for American Indians. OTRA
was created by OST as a response to trust initiatives developed during
the tribal consultation process of 2002. OTRA conducts performance
audits, examinations and reviews of Interior entities as well as Tribes
that manage fiduciary trust activities. Examinations are routinely
conducted at locations that perform trust operations, and are planned to
result in a performance rating.

**[Current Status]{.underline}**

**Indian Trust Examinations**

During this reporting period, OTRA performed 22 trust reviews.
Twenty-four draft reports were issued for comment and seven final
reports were issued.

OTRA completed 11 trust record assessments and issued 22 final reports
during this reporting period.

**Annual Interior Indian Trust Funds Financial Statement Audit**

The Indian trust funds financial statement audit, required by the
American Indian Trust Fund Management Reform Act of 1994, is conducted
by an independent auditor under OIG management. The independent auditor
continued work on the FY2005 audit during this reporting period and is
expected to complete work during the first quarter of FY2006.

OTRA completed the contracting process for the FY2006 Indian trust funds
financial statement audit. The independent auditors will begin work
early in CY2006.

**Compliance Reviews**

Compliance reviews are generated by information received from
beneficiaries, employees and the public. The reviews usually concern the
adequacy or status of fiduciary activities of Interior. During this
reporting period, eight cases were in inventory. Two cases were added to
the inventory and two cases were closed. Field work or report drafting
continued on the remaining eight.

**[Delays and Obstacles]{.underline}**

Lack of Internet access impedes OTRA's work processes and its ability to
communicate effectively, both internally and externally.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Trust
Review and Audit section of the *Status Report to the Court Number
Twenty-Three*. The information provided in this section is accurate to
the best of my knowledge.

Date: October 21, 2005

Name: *Signature on File*

D. Jeff Lords

Acting Director, Office of Trust Review and Audit

Office of the Special Trustee for American Indians

B.  []{#__RefHeading___Toc118515798 .anchor}**OST-OFFICE OF THE CHIEF
    INFORMATION OFFICER**

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1.  []{#__RefHeading___Toc118515799 .anchor}**RECORDS MANAGEMENT**

**[Introduction]{.underline}**

The Office of Trust Records was established in 1999 to develop and
implement a program for the economical and efficient management of trust
records, consistent with the 1994 Act, the Federal Records Act and other
statutes and implementing regulations. The OTR records management
program has been developed and implemented, and continues to evolve, to
ensure that necessary Indian records are maintained, records retention
schedules are consistent with retention needs, and records are
safeguarded throughout their life-cycles.

As reported in the *Status Report to the Court Number Eleven*, the line
authority for supervision and management of OTR was vested in the
Assistant Deputy Secretary by the Deputy Secretary by memorandum dated
September 5, 2002. On September 30, 2005, the memorandum was rescinded
by the Associate Deputy Secretary. Accordingly, effective

October 1, 2005, OTR reports to the Chief Information Officer, OST, in
accordance with the pertinent provision of the Departmental Manual.

**[Accomplishments and Completions]{.underline}**

**American Indian Records Repository**

Approximately 122,420 indexed boxes are located in the AIRR as of the
end of this reporting period. As previously reported, OTR has
historically reported the number of boxes transferred to AIRR for
storage. However, NARA uses cubic feet as the measure for records
stored. Thus far, NARA reports that they are currently storing 128,790
cubic feet of indexed inactive records at AIRR. Some boxes are larger
than one cubic foot (e.g., map boxes).

**Records Indexing Project**

Indexing of approximately 124,325 boxes has been completed as of the end
of this reporting period. The number of completed boxes (indexed and
quality reviewed) differs from the number of boxes stored at AIRR
because not all completed boxes were sent to AIRR from the Annex before
the end of the reporting period.

Approximately 6,745 boxes of inactive records were moved from BIA/OST
field locations to the Lenexa Annex for indexing during this reporting
period. Once indexed, these boxes will be stored in the AIRR.

As previously reported, the electronic BISS was classified as a Privacy
Act system of records by Interior. The Privacy Act notice for this
system was published in the Federal Register on

July 29, 2005. The notice provided that the classification would be
effective as proposed, unless comments requiring a contrary
determination were received within the 40-day comment period. No
comments were received by the end of the 40-day comment period.

**Training**

OTR provided records management training for 261 BIA and OST identified
records contacts and 13 tribal employees during this reporting period.

**Equipment Purchases**

91 pieces of fireproof filing equipment were delivered to BIA and OST
offices during this reporting period. Additional requests will be
responded to as received.

**[Current Status]{.underline}**

**Safeguarding Records**

As reported, 283 boxes of inactive records that were or may have been
damaged or contaminated by mold, mildew, mouse droppings or other
adverse elements were shipped to NARA for remediation in the previous
reporting period. All boxes have been reviewed and cleaned. There are
approximately 30 boxes which NARA has determined require further care.
These records were previously exposed to fire and water. It is
anticipated that these records will receive further attention in the
next reporting period.

**Record Keeping Requirements**

The "Final Decision Regarding Self-Determination and Self-Governance
Funding Agreement Language on Fiduciary Trust Records Management" was
published in the Federal Register on August 29, 2005. The Final Decision
states that "the Department decided not to institute the proposed policy
on fiduciary trust records management for Title I and Title IV
Tribes/Consortia; rather, the Department will negotiate with each
Tribe/Consortium a specific section in the funding agreement that
addresses the Tribe's/Consortium's and the Secretary's respective
responsibilities regarding the management of fiduciary trust records."
The notice did provide specific language for fiduciary trust records
management which was to be negotiated into the agreements for FY2006.

**National Archives Records**

As reported in the OTR Activity Report for August 2005 (filed on
September 19, 2005), OTR received a copy of a letter dated September 13,
2005, from NARA to the Assistant Deputy Secretary of the Interior
regarding an incident involving records at the Main Archives in
Washington, DC. OTR also received a copy from the Assistant Deputy
Secretary of a letter dated September 28, 2005, from NARA to Dennis
Gingold, Esq.

**Records Retention Schedules**

OTR has not yet received approval from the Archivist of the United
States of the following electronic systems records schedules that were
submitted in the previous reporting period: Anadarko REM, InfoDat and
CFI. OTR is working with BIA to provide NARA with additional technical
analysis related to the GIS schedule. The BISS records schedule was
submitted to NARA during the previous reporting period and was
inadvertently not included in the previous report. NARA requested that
certain changes be made to the BISS records schedule and it was
resubmitted on September 29, 2005 after the changes were made.

The following five BIA electronic systems records schedules were
submitted to NARA for appraisal and approval on September 29, 2005:
MADS, Keyfile System, GLADS, Alaska Title Plant Database, and Land Title
Mapper.

**Records Evaluation**

As previously reported, 31 boxes set aside for evaluation remain at OTR
in Albuquerque pursuant to a litigation hold. There has been no change
during this reporting period.

**[Delays and Obstacles]{.underline}**

Lack of Internet access continues to hinder OTR's ability to provide
remote access to the record index database for authorized users of the
records. If Internet access were available, authorized researchers could
conduct their searches from their respective work sites and only visit
AIRR when necessary to inspect specific boxes.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Records
Management section of the *Status Report to the Court Number
Twenty-Three.* The information provided in this section is accurate to
the best of my knowledge.

Date: October 17, 2005

Name: *Signature on File*

Ethel J. Abeita

Director, Office of Trust Records

Office of the Special Trustee for American Indians

A.  []{#__RefHeading___Toc118515800 .anchor}**TRUST ACCOUNTABILITY**

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1.  []{#__RefHeading___Toc118515801 .anchor}**TRUST BUSINESS PROCESS
    MODELING**

**[Introduction]{.underline}**

Interior is working to build a highly effective fiduciary trust services
organization by implementing the business objectives contained in the
CTM. Those business objectives are being used to guide implementation of
the FTM. Implementation of the FTM is a collaborative effort of BIA,
OST, BLM, MMS and OHA, and is integrated with Interior's other trust
reform initiatives. The FTM is being implemented to transform the
current trust business processes into more efficient, consistent,
integrated and fiscally responsible business processes that meet the
needs and priorities of the beneficiaries.

**[Current Status]{.underline}**

**FTM - General**

Work is continuing toward implementation of the FTM at the pilot
agencies now that the conversion of software systems is complete. The
availability of the new data systems supports streamlining of business
processes, such as leasing, collections, title, probates, and expanded
beneficiary services.

As previously reported, an FTM training task deliverable is being
developed. During this reporting period, an additional site visit was
performed to obtain input regarding training preferences and
methodologies.

Reengineering staff continued to participate in the Regulatory
Initiative effort during this reporting period. Preliminary language
supporting the initiative has been prepared and is being circulated
within the work groups to solicit comments and identify cross-cutting
issues.

During this reporting period, draft handbooks for LTRO, probate,
rights-of-way, and leasing and permitting were submitted for review to
BIA.

**Universal Support Function**

A process to automate processing of CSS work tickets was presented to
senior management. Site visits to the pilot agencies to assess
opportunities for improving financial transaction work flow are expected
to occur during the next reporting period. The process will then be
revised, as needed, to reflect how business will be conducted in the
future.

**[Delays and Obstacles]{.underline}**

Lack of Internet access impedes communication with other trust bureaus
and offices, and hinders the expansion of reengineered processes that
utilize the Internet. This exacerbates the sheer complexity of
reengineering the existing trust business processes.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Trust
Business Process Modeling section of the *Status Report to the Court
Number* *Twenty-Three.* The information provided in this section is
accurate to the best of my knowledge.

Date: October 27, 2005

Name: *Signature on File*

John Bennett

Acting Deputy Special Trustee, Trust Accountability

Office of the Special Trustee for American Indians

2.  []{#__RefHeading___Toc118515802 .anchor}**TRUST DATA QUALITY AND
    INTEGRITY**

**[Introduction]{.underline}**

The success of trust reform depends, in part, on the accuracy of data
generated from the maintenance of trust assets, ownership of trust
assets, distribution of trust income, and management of trust accounts.
The DQ&I project focuses on three primary initiatives: (1) assisting BIA
with document encoding into the trust systems, (2) validating/correcting
CDE to their respective source documents and (3) implementing Post-QA
processes.

**[Accomplishments and Completions]{.underline}**

During this reporting period, TPMC\'s contractors:

-   Scanned trust conveyance documents necessary to perform CDE
    validation/correction for the Standing Rock Agency.

-   Assisted PRO-LTRO with land title system conversion cleanup. 172
    trust patent documents were updated during the quarter, completing
    all of 272.

-   Scanned trust encumbrance files at the Horton, Shawnee and Pawnee
    Agencies necessary to perform CDE validation/correction, TAAMS lease
    encoding and performance bond inventory tasks.

-   Scanned trust right-of-way files at the SPRO-LTRO that are necessary
    to perform CDE validation/correction and TAAMS lease encoding for
    the Horton, Shawnee and Pawnee Agencies.

-   Performed Post-QA on correcting entries for the remaining 12 Concho
    and 42 Anadarko CDE title variances outstanding from the CDE
    validation/correction task.

**[Current Status]{.underline}**

The DQ&I project continued for: (1) SPRO-LTRO, (2) GPRO-LTRO, (3) Pima
Agency and (4) PRO-LTRO.

During this reporting period, TPMC:

-   Assisted Concho Agency to reduce RDRS data entry backlogs by
    encoding 16 probate orders, 2 oil and gas leases, and 23 landowner
    ID changes.

-   Initiated the CDE validation/correction task for Shawnee Agency.

-   Analyzed variances in tract ownership between the land title system
    and legacy realty system. Provided results and recommendations for
    166 of 261 Concho and 323 of 342 Anadarko tracts.

-   Researched and updated landowner ID numbers in the land title system
    at the PRO-LTRO. 194 BIA-certified ID numbers were completed during
    the quarter, for a cumulative total of 209 of a second phase total
    of 1,043 BIA-certified ID numbers.

-   Performed global ID changes in the SPRO land title system. Scanned
    owner ID documentation for 404 individual owners, completed research
    for 207 owners and performed encoding for 123 owners.

-   Verified beneficiary ID numbers to support SPRO-LTRO encoding of
    backlogged probates and modifications for Shawnee, Pawnee and Horton
    Agencies. Researched ID numbers associated with 89 probates and
    performed initial encoding in the land title system.

**[Delays and Obstacles]{.underline}**

-   Securing timely BIA trust system logon IDs.

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-   Lack of access to the Internet has resulted in: (1) communication
    delays; (2) adverse project coordination issues; (3) increased
    administrative program costs; and (4) the overall DQ&I project being
    unable to take full advantage of available information technology.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Trust Data
Quality and Integrity section of the *Status Report to the Court Number
Twenty-Three.* The information provided in this section is accurate to
the best of my knowledge.

Date: October 28, 2005

Name: *Signature on File*

John E. White

Trust Reform Officer

Office of the Special Trustee for American Indians

3.  []{#__RefHeading___Toc118515803 .anchor}**INDIAN FIDUCIARY TRUST
    TRAINING PROGRAM**

**[Introduction]{.underline}**

Interior has a continuing responsibility to provide adequate staffing,
supervision and training for trust fund management and accounting
activities. Fiduciary trust training is essential to the success of
Interior's trust reform efforts and forms an integral part of all
training for Interior employees who are involved in the management of
Indian trust assets.

**[Accomplishments and Completions]{.underline}**

OST offered one session of the course, *Fiduciary Overview Program*,
presented by Cannon Financial Institute, with 14 OST, BIA and tribal
personnel attending during this reporting period. A total of 684 people
have attended this course since March 2003. This course compares and
contrasts the federal Indian trust administered through Interior with
private sector trusts administered through banks and other financial
institutions.

During this reporting period, Cannon Financial Institute personnel also
presented the *Risk Management, Guardianship, Fiduciary Behavior* and
*Asset Management* specialty courses to 145 OST, BIA and tribal
personnel. These four courses are part of the previously reported
certification program. Additional sessions of *Risk Management, Wills &
Probate, Accounting and Asset* Management are expected to be presented
during the next reporting period.

During this reporting period, OST training staff conducted 4 sessions to
provide training in TFAS, CSS, StrataVision and the historical query
database to 41 OST, BIA and contractor staff.

OST and BIA staff presented the three-day course, *Trust Fundamentals,*
to 30 OST, BIA and tribal staff. This course includes such topics as the
history and policy of Indian trust, current trust reform activities, job
roles and responsibilities, and organization and working relationships.
This course is expected to be presented again during the next reporting
period.

During this reporting period, OST training staff conducted 9 sessions to
provide Lockbox process training to 250 OST, BIA and contractor staff.

**[Current Status]{.underline}**

Construction continues on the NIPTC in Albuquerque and is expected to be
completed by the end of CY2005. The first NIPTC governance board meeting
was held this reporting period. The governance board consists of
employees from OST, BIA, MMS, BLM, the U.S. Fish and Wildlife Service
National Conservation Training Center and DOI University. At this
meeting, the board discussed its roles, responsibilities and objectives.
It plans to meet on a quarterly basis.

**[Delays and Obstacles]{.underline}**

The lack of Internet access inhibits electronic communication with other
governmental agencies and contractors, hinders the research of training
tools and potential contractors, and restricts OST's ability to access
online training programs.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Indian
Fiduciary Trust Training Program section of the *Status Report to the
Court Number Twenty-Three.* The information provided in this section is
accurate to the best of my knowledge.

Date: October 20, 2005

Name: *Signature on File*

Dianne M. Moran

Director, Trust Training

Office of the Special Trustee for American Indians

4.  []{#__RefHeading___Toc118515804 .anchor}**RISK MANAGEMENT**

**Introduction**

The objectives of the risk management initiative are to design, deliver,
and implement a comprehensive risk management program that includes
extensive management controls for monitoring and evaluating Interior's
Indian trust asset management program. The risk management program
continues to be implemented by TPMC. OTRA monitors and evaluates
management corrective action plans to mitigate control deficiencies.

**[Accomplishments and Completions]{.underline}**

During this reporting period:

-   Training was provided to staff with responsibilities for conducting
    risk self-assessments at OST, MMS and the BIA pilot agencies.

-   OST (with the exception of the Trust Beneficiary Call Center)
    completed risk self-assessments utilizing RM-PLUS.

-   The new BIA processes were incorporated into the RM-PLUS tool and
    both Concho and Anadarko agencies completed their risk
    self-assessments utilizing RM-PLUS.

-   MMS completed manual risk self-assessment.

**[Current Status]{.underline}**

OST continues to work with OSM and BLM on the use of the RM-PLUS tool.

**[Delays and Obstacles]{.underline}**

The lack of Internet access complicates the implementation and use of
RM-PLUS, since it is designed as a web-based application.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Risk
Management section of the *Status Report to the Court Number
Twenty-Three*. The information provided in this section is accurate to
the best of my knowledge.

Date: October 27, 2005

Name: *Signature on File*

John Bennett

Acting Deputy Special Trustee, Trust Accountability

Office of the Special Trustee for American Indians

5.  []{#__RefHeading___Toc118515805 .anchor}**REGULATIONS, POLICIES AND
    PROCEDURES**

**[Introduction]{.underline}**

OTP in OST was established on April 21, 2003, to assist Interior in
establishing "consistent, written policies and procedures for trust fund
management and accounting" as stated in the 1994 Act. OTP oversees and
facilitates the development, promulgation and coordination of
trust-related regulations, policies, procedures and other materials to
guide the proper discharge of Interior's fiduciary responsibilities. OTP
is separate from BIA's PPA, which is responsible for policies,
procedures and regulations affecting all BIA activities. PPA activities
thus are reported in the BIA section of the reports to the Court.

**[Accomplishments and Completions]{.underline}**

**25 CFR 124 -- Deposits of Proceeds of Lands Withdrawn for Native
Selection under the Alaska Native Claims Settlement Act.** The final
rule was published in the Federal Register early in this reporting
period.

The Disbursing DOP was completed and issued.

**[Current Status]{.underline}**

OTP continues to develop the draft OST Directives System Handbook.
Publication of the handbook now is expected by the end of the second
quarter of FY2006.

Work continues on the Reporting and Reconciliation DOP. Completion and
issuance now is expected during the next reporting period. Work,
including a site visit to the Osage Nation, continued on an Osage DOP
for account maintenance and disbursement because of statutes and
regulations unique to the Osage Tribe. Completion is expected by the end
of CY2005.

**25 CFR 1200 -- American Indian Trust Fund Management Reform Act.**
Technical amendments to this rule have been prepared and are awaiting
final internal approval. Publication is expected by the end of CY2005.

**[Delays and Obstacles]{.underline}**

Lack of access to the Internet and its repository of online statutes,
the Federal Register and other resources continues to present challenges
to this office.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Office of
Trust Regulations, Policies and Procedures section of the *Status Report
to the Court Number Twenty-Three*. The information provided in this
section is accurate to the best of my knowledge.

Date: October 19, 2005

Name: *Signature on File*

Philip Viles, Director

Office of Trust Regulations, Policies and Procedures

Office of the Special Trustee for American Indians

A.  []{#__RefHeading___Toc118515806 .anchor}**FIELD OPERATIONS**

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1.  []{#__RefHeading___Toc118515807 .anchor}**APPRAISAL**

**[Introduction]{.underline}**

The Office of Appraisal Services, under a management contract with
NBC-ASD, is responsible for Indian land valuations. The contract was
established to provide impartial estimates of market value for a variety
of real property interests on land owned in trust or restricted status
by individual Indians, Alaska Natives, and Indian Tribes. Various
regulations governing Indian trust lands require valuations. To meet
this requirement, an appraisal or other valuation method is used to
determine fair market value of Indian lands.

**[Accomplishments and Completions]{.underline}**

The position of Regional Supervisory Appraiser for the Eastern Region
was filled during this reporting period. OAS filled three permanent
review appraiser positions in the Great Plains and Northwest Regions.
Selection is pending for a permanent review appraiser position in the
Rocky Mountain Region.

The Chief Appraiser has received approval to proceed with the creation
of the Office of Minerals Evaluation within ASD (previously reported as
the Indian Minerals Valuation Unit). OME will establish the line of
authority for mineral appraisals and will perform mineral evaluation
services for clients in support of ILCA.

A national appraisal conference for all OAS appraisers and staff was
held in August 2005. This conference included continuing appraisal
education concerning the Uniform Appraisal Standards for Federal Land
Acquisitions as well as presentations concerning valuations of
rights-of-way, minerals evaluations and records management.

**[Current Status]{.underline}**

The Deputy Chief Appraiser position was re-advertised during this
reporting period and a selection is expected during the next reporting
period.

ASD, in coordination with OST, continues to conduct a comprehensive
analysis of OAS staff and training requirements. Temporary review
appraiser positions are being added in the Alaska, Rocky Mountain and
Western Regions, to help reduce the backlog in those areas. In addition,
budgetary and workload analysis is being conducted to determine the
appropriate number of permanent review appraisers.

An updated department-wide appraisal handbook, which incorporates the
OAS handbook section, was completed in draft form and is now being
circulated for comment within Interior.

Work continued on the cooperative effort between OAS and NBC to
establish regional contracts with independent contractors to perform
appraisals and alleviate backlogs. Efforts continue to streamline the
requisition and outsourcing process. The scope of work for the
previously-reported blanket purchase order for the Northwest Region was
completed, and is being expanded into a multi-region approach.

**Appraisal Backlog**

As of this reporting period, the appraisal backlogs are as follows:

+-----------------------+-----------------------+-----------------------+
|                       | **Appraisal Backlog** | **Appraisal Backlog   |
|                       |                       | \***                  |
|                       | **As of 6/30/05**     |                       |
|                       |                       | **As of 9/30/05**     |
+-----------------------+-----------------------+-----------------------+
| Northwest             | 402                   | 470                   |
+-----------------------+-----------------------+-----------------------+
| Rocky Mountain        | 592                   | 811                   |
+-----------------------+-----------------------+-----------------------+
| Midwest               | 38                    | 43                    |
+-----------------------+-----------------------+-----------------------+
| Western               | 42                    | 37                    |
+-----------------------+-----------------------+-----------------------+
| Southwest             | 27                    | 13                    |
+-----------------------+-----------------------+-----------------------+
| Eastern Oklahoma      | 51                    | 68                    |
+-----------------------+-----------------------+-----------------------+
| Navajo                | 21                    | 15                    |
+-----------------------+-----------------------+-----------------------+
| Pacific               | 2                     | 0                     |
+-----------------------+-----------------------+-----------------------+
| Alaska                | 293                   | 325                   |
+-----------------------+-----------------------+-----------------------+
| Eastern               | 0                     | 0                     |
+-----------------------+-----------------------+-----------------------+
| Southern Plains       | 11                    | 4                     |
+-----------------------+-----------------------+-----------------------+
| Great Plains          | 10                    | 10                    |
+-----------------------+-----------------------+-----------------------+
| **TOTAL**             | **1,489**             | **1,796**             |
+-----------------------+-----------------------+-----------------------+

> \* The backlog includes all appraisal requests from BIA whether or not
> they are required for a proposed transaction. The requests are
> addressed in priority order based on factors such as court-ordered
> transactions, economic transactions, and rights-of-way transactions.
> The remaining requests for which no transaction is pending may appear
> on the backlog list until appraisal staff has completed priority
> assignments.

This table does not include appraisal backlog information from the
compacted and contracted Tribes. The MOUs that are currently being
negotiated with Tribes require quarterly reporting of backlog
information. This information is expected to be incorporated into future
reports to the Court.

**[Delays and Obstacles]{.underline}**

The inability to utilize the Internet as a tool to communicate with
outside contacts to research comparable sales and other information is a
continuing hardship.

Difficulties continue in recruiting qualified appraisers for permanent,
temporary and contract positions, particularly in remote locations.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Appraisal
section of the *Status Report to the Court Number Twenty-Three.* The
information provided in this section is accurate to the best of my
knowledge.

Date: October 20, 2005

Name: *Signature on File*

Brian M. Holly, MAI

Appraisal Services Directorate

National Business Center

A.  []{#__RefHeading___Toc118515808 .anchor}**TRUST SERVICES**

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1.  []{#__RefHeading___Toc118515809 .anchor}**CURRENT ACCOUNTING
    ACTIVITIES**

**[Introduction]{.underline}**

Current accounting activities focus on: a) whereabouts unknown accounts;
b) trust funds accounting system; c) special deposit accounts; d) small
balance accounts; and e) accounting discrepancies.

WAU are classified as such for various reasons, including (a) new
accounts established without an address, (b) mail returned for invalid
address and (c) account holder refused or did not claim mail. A variety
of methods and means are used to locate WAU account holders.

TFAS is a generic term for a COTS trust fund accounting system that
provides the basic receipt, accounting, investment, disbursing and
reporting functions common to commercial trust funds management
operations.

SDA are temporary accounts for the deposit of trust funds that cannot
immediately be credited to the proper account holders. As explained in
the BIA/OST Interagency Procedures Handbook, this type of account is to
be used only as an exception to the rule that trust funds immediately be
deposited to the credit of, and then distributed as soon as practicable
to, the individual and tribal beneficiaries. The SDA project has two
sub-projects: the retrospective (pre-January 1, 2003 receipts) and the
prospective (post-December 31, 2002 receipts) phases. OHTA has
responsibility for "resolution" (i.e., research and distribution of
funds) of the retrospective phase, while BIA has comparable
responsibility for the prospective phase. This section of the report to
the Court thus addresses only the prospective phase.

Small balance accounts are defined as those with balances of \$.01 -
\$1.00 and no activity in the preceding eighteen months. Management
expenses for these accounts are considerable, in part because (as
directed by Congress) annual statements must be sent to these account
holders.

Various accounting discrepancies that existed prior to the conversion to
TFAS still need research and resolution. Some may impact individual
accounts. At present, OST has a daily and monthly reconciliation process
in place to ensure that transactional reporting to Treasury is accurate
and that any discrepancies are researched and reconciled during the next
accounting period. While this process ensures resolution of current
discrepancies in timely fashion, separate research and reconciliation
efforts are needed to address the pre-TFAS discrepancies.

a.  **Whereabouts Unknown Accounts**

**[Accomplishments and Completions]{.underline}**

During this reporting period, TPMC staff conducted one WAU beneficiary
outreach at the Daybreak Pow Wow in Seattle, WA. As a result of this
outreach effort, TPMC received current addresses for 36 WAU account
holders.

OST hired a contractor during the last reporting period to focus on
securing current addresses for, or determining the status of, WAU
accounts with the large account balances.

**[Current Status]{.underline}**

Priority continues to be placed on securing current addresses for
account holders of the rolling top 100 highest dollar balance WAU
accounts. During this reporting period, 16 of the top 100 WAU accounts,
with combined account balances in excess of \$1.5 million, were updated
with current addresses.

During this reporting period, 2,040 accounts with a combined balance of
\$1 million were added to the WAU list, and 4,601 account holders with a
combined balance of \$6 million were located. As of September 30, 2005,
there were 46,630 WAU accounts with a combined balance of \$65,247,914.
The following table illustrates the number of accounts stratified by
account balance and WAU category:

+----------------+-------------+--------+-----------+-----------+------+
| **Account      | **Corres    | **Acc  | **A       | **R       | *    |
| balance**      | pondence/** | ount** | waiting** | efused/** | *Tot |
|                |             |        |           |           | al** |
|                | **Check     | **S    | **Address | **Un      |      |
|                | Returned**  | etup** | Confi     | claimed** |      |
|                |             |        | rmation** |           |      |
|                |             | **No** |           | **Mail**  |      |
|                |             |        |           |           |      |
|                |             | **Add  |           |           |      |
|                |             | ress** |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Equal to or    | 18          | 9      | 0         | 0         | 27   |
| over \$100,000 |             |        |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Under          | 34          | 13     | 0         | 0         | 47   |
| \$100,000 and  |             |        |           |           |      |
| equal to or    |             |        |           |           |      |
| over \$50,000  |             |        |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Under \$50,000 | 2,072       | 805    | 0         | 1         | 2    |
| and equal to   |             |        |           |           | ,878 |
| or over        |             |        |           |           |      |
| \$5,000        |             |        |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Under \$5,000  | 6,568       | 1,579  | 2         | 8         | 8    |
| and equal to   |             |        |           |           | ,157 |
| or over        |             |        |           |           |      |
| \$1,000        |             |        |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Under \$1,000  | 8,222       | 3,279  | 3         | 2         | 11   |
| and equal to   |             |        |           |           | ,506 |
| or over \$100  |             |        |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Under \$100    | 11,842      | 4,767  | 9         | 5         | 16   |
| and equal to   |             |        |           |           | ,623 |
| or over \$1    |             |        |           |           |      |
+----------------+-------------+--------+-----------+-----------+------+
| Under \$1      | 3,373       | 4,005  | 10        | 4         | 7    |
|                |             |        |           |           | ,392 |
+----------------+-------------+--------+-----------+-----------+------+
| **Total**      | 32,129      | 14,457 | 24        | 20        | 46   |
|                |             |        |           |           | ,630 |
+----------------+-------------+--------+-----------+-----------+------+

**[Delays and Obstacles]{.underline}**

The influx of WAU accounts categorized as "Account Setup No Address"
causes the total number of WAU accounts to remain relatively constant.
These accounts primarily result from a lack of current addresses for
individual heirs named in probate orders or recipients of per capita
distributions. Also, accounts are being created in TFAS for
non-financial asset owners in order to generate asset statements. Many
of these owners do not have current addresses. As a result, the total
number of WAUs is expected to increase significantly.

There presently are 17,836 supervised IIM account holders (minors,
emancipated minors, adults in need of assistance, and non-compos mentis)
coded as WAU. Updating supervised account addresses coded as WAU
presents a challenge, since BIA Social Services must verify and update
the address changes to these accounts.

The lack of Internet access limits communication effectiveness. OST and
its contractor must rely primarily on mail and telephone communication
with IIM account holders.

b.  **Trust Funds Accounting System**

**[Accomplishments and Completions]{.underline}**

On June 30, 2005, a conversion of the real property asset information
for the Concho and Anadarko pilot agencies was completed. During this
reporting period, asset statements for those individuals who have real
property held in trust at Concho and Anadarko were produced and mailed
in conjunction with the quarterly IIM account statements to the
accountholders who have a valid address on TFAS.

**[Current Status]{.underline}**

Testing commenced using TFAS to do the real property income allocation
based upon the beneficial title interest recorded in TAAMS. It is
anticipated that this process will be put into production during the
next reporting period.

> **c. Special Deposit Account Activity**

**[Current Status]{.underline}**

BIA has the responsibility for distribution of SDA funds received since
January 1, 2003 (prospective receipts). It is the policy of BIA to
distribute funds within 30 days of receipt into SDA. During this
reporting period, there were 4,587 receipt transactions posted to SDA.
Of these, 177 were undistributed and aged more than 30 days as of
September 30, 2005.

During this reporting period, aged funds were held in 278 fewer SDA than
in the previous reporting period. Undistributed aged receipts decreased
by 3,011 and the combined dollar amount decreased by \$1,589,630.45. As
of September 30, 2005, funds were held in SDA with a combined dollar
amount of \$1,542,462.69, which represented 1,398 undistributed receipts
aged over 30 days from January 1, 2003, through September 30, 2005. As
of September 30, 2005, there were 556 receipts in 170 SDA aged more than
one year for a combined dollar amount of \$586,362.89.

During this reporting period, OST concentrated on assisting BIA staff in
performing work necessary to distribute aged receipts (over 30 days) at
the Fort Belknap, Pima, Yakama, Fort Hall and Eastern Navajo agencies.
OST staff and contractors spent a combined eight weeks at these
agencies. Through these efforts, in coordination with the efforts of
BIA, aged receipts totaling \$622,000 were distributed from SDA during
the reporting period.

During this reporting period, OST contractors also continued to assist
the Fort Belknap Agency to reduce its backlogs by encoding probate
orders into BIA's IRMS. Reducing backlogs assists agencies with their
SDA distribution efforts.

**[Delays and Obstacles]{.underline}**

Some BIA agencies still are not utilizing StrataVision to obtain current
aging reports to assist in the monitoring and management of their SDA
receipt activity. OST continues to make training available to encourage
the use of StrataVision.

d.  **Small Balance Accounts**

As of September 30, 2005, there were 14,995 accounts that have a \$.01 -
\$1.00 balance with no activity for the previous 18 months. The total
sum included in those accounts is \$2,043.58. Statements are sent to
account holders for these accounts on an annual basis pursuant to
direction from Congress.

**e. Accounting Discrepancies**

Interior has submitted an OMB approved legislative proposal to resolve
the difference between the subsidiary account ledger (liabilities) and
the IIM investment pool (assets), of approximately \$6 million. However,
the proposal has not been acted upon by Congress.

**[Assurance Statements]{.underline}**

I concur with the content of the information contained in the Accounting
Discrepancies subsection of the Current Accounting Activities section of
the *Status Report to the Court Number Twenty-Three*. The information
provided in this subsection is accurate to the best of my knowledge.

Date: October 27, 2005

Name: *Signature on File*

Margaret Williams

Deputy Special Trustee, Trust Services

Office of the Special Trustee for American Indians

I express no opinion on the content of the Accounting Discrepancies
subsection, above. I concur with the content of the information
contained in the balance of the Current Accounting Activities section of
the *Status Report to the Court Number Twenty-Three*, and this
information is accurate to the best of my knowledge.

Date: October 27, 2005

Name: *Signature on File*

John Bennett

Acting Deputy Special Trustee, Trust Accountability

Office of the Special Trustee for American Indians

IV. []{#__RefHeading___Toc118515810 .anchor}**BUREAU OF INDIAN AFFAIRS**

    A.  []{#__RefHeading___Toc118515811 .anchor}**TRUST REGULATIONS,
        POLICIES AND PROCEDURES**

**[Introduction]{.underline}**

The Office of Planning and Policy Analysis (PPA) in the Office of the
Assistant Secretary -- Indian Affairs was established on April 21, 2003.
PPA is responsible for developing and promulgating Indian Affairs
directives. PPA is separate from OST\'s Office of Trust Regulations,
Policies and Procedures, whose activities are reported in the OST
section of the status reports to the Court.

**[Accomplishments and Completions]{.underline}**

**Indian Forest Management Handbook, Volume 4 (Permit Sales of Forest
Products) --** The handbook supporting 53 IAM was published during the
reporting period and is referenced at

53 IAM 4-H, Permit Sales of Forest Products.

**[Current Status]{.underline}**

The following previously-reported regulations are included in the
Regulatory Initiative:

-   **25 CFR 151 -- Land Acquisitions --** The proposed revisions are
    expected to be published during CY2006.

-   **25 CFR 162 -- Leases and Permits, Subparts B, G, and H --** The
    proposed revision of Subpart B and addition of Subparts G and H are
    expected to be published during CY2006.

-   **25 CFR 166 -- Grazing Permits --** The proposed revisions are
    expected to be published during CY2006.

-   **25 CFR 216 -- Surface Exploration, Mining, and Reclamation of
    Lands --** A draft of the proposed revisions is expected during
    CY2006.

**25 CFR 161 -- Navajo Partitioned Lands Grazing Permits --** The final
rule was published in the Federal Register on October 7, 2005. This rule
is effective January 5, 2006.

**25 CFR 162 -- Leases and Permits, Subparts C and D -- Residential
Leases and Business Leases --** The final rule is expected to be
published during the first quarter of CY2006.

**25 CFR 169 -- Rights-of-Way Over Indian Lands --** The handbook is
expected to be published by the end of CY2005.

**25 CFR 243 -- Reindeer in Alaska --** The final rule is expected to be
published by the end of CY2005.

**35 BIAM Information Resources Management --** Revisions have been
incorporated into a new 60 IAM. Publication has been delayed due to
internal review, which resulted in additional revisions. Assistant
Secretary -- Indian Affairs approval is expected by the end of CY2005.
The handbook supporting 60 IAM is now expected to be published during
CY2006.

**[Delays and Obstacles]{.underline}**

Lack of access to the Internet has hindered PPA's ability to research
statutes and departmental manuals and makes distribution of documents
for review by Tribes more difficult and costly.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Trust
Regulations, Policies and Procedures -- BIA section of the *Status
Report to the Court Number Twenty-Three*. The information provided in
this section is accurate to the best of my knowledge.

Date: October 24, 2005

Name: *Signature on File*

Bruce Blanchard

Director, Office of Planning and Policy Analysis

Bureau of Indian Affairs

A.  []{#__RefHeading___Toc118515812 .anchor}**FRACTIONATION**

**[Introduction]{.underline}**

Fractionation of Indian trust and restricted land stems from the federal
Indian policy of the 19^th^ Century. Fractionation occurs as land passes
from one generation to the next and more and more heirs or devisees
acquire an undivided interest in the land. This is a complex and
potentially emotionally-charged issue, due primarily to cultural
differences, historical legacy and family associations of the present
owners with the original Indian owners of those lands. Efforts to
address this complex issue are coordinated primarily through the BIA
Indian Land Consolidation Office, which seeks to help Tribes make use of
the opportunities offered by the Indian Land Consolidation Act, as
amended in 2004. ILCO is operating several acquisition projects and,
from there, a nationwide plan is being implemented to promote
consolidation of the ownership of Indian land.

**[Accomplishments and Completions]{.underline}**

-   Acquired 21,403 fractional interests during this reporting period,
    for a cumulative total of 183,992 interests for ILCP in the Midwest,
    Northwest, Western, Eastern Oklahoma, Navajo, Rocky Mountain and
    Great Plains Regions.

-   Of the total interests acquired, 87% were interests of less than 2%
    ownership in the respective tracts of land.

-   Acquired a cumulative total equivalent of 191,603.67 acres for the
    project reservations.

**[Current Status]{.underline}**

ILCO continued to manage active acquisition programs for 18 reservations
within seven BIA regions until the end of the fiscal year. ILCO had
expended all funding available to acquire fractionated interests by June
1, 2005. ILCO received \$10.22 million from OST to continue acquisition
activities. Presently, all acquisition sites are wrapping up activities
for FY2005 and preparing for acquisitions during the next fiscal year,
subject to available funding.

Due to the volume of beneficiary requests to sell their land interests,
the annual appropriations for purchases are expected to be exhausted
before the end of the FY2006. If funds are exhausted, ILCO expects to
seek additional funding and use its program staff to prepare for
acquisitions during FY2007.

Current ILCP activities include:

-   Preparing to implement ILCO's national expansion strategy in FY2006;

-   Preparing to target and acquire additional *Youpee* interests in
    FY2006;

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-   Field testing of LCTS was completed on October 4, 2005. ILCO is
    working with AS-IA CIO to finalize acceptance and resolve any
    remaining developmental issues. ILCO has scheduled staff training to
    begin the last week of October 2005. Full implementation is expected
    by the end of the first quarter of FY2006.

-   Testing of the MAD/LCP has been completed for all twelve
    reservations in the Great Plains Region.

**[Delays and Obstacles]{.underline}**

-   Required support from ILCO to the GPRO and SWRO LTROs to assist with
    recording ILCP deeds, re-vesting *Youpee* interests, researching
    ownership files and recording to ownership records reduces the
    availability of ILCP funds for acquisitions of land interests.

-   Probate backlog and *Youpee* issues continue to impede the
    land-purchase transaction process.

-   Lack of Internet access results in slower processing of applications
    from potential sellers and hinders searches for WAU account holders.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the
Fractionation section of the *Status Report to the Court Number
Twenty-Three.* The information provided in this section is accurate to
the best of my knowledge.

Date: October 17, 2005

Name: *Signature on File*

Robert R. Jaeger

Director, Indian Land Consolidation Office

Bureau of Indian Affairs

A.  []{#__RefHeading___Toc118515813 .anchor}**PROBATE**

**[Introduction]{.underline}**

Federal law permits Indian owners to pass title to their trust assets by
testamentary devise or by intestate succession, and imposes upon
Interior the duty of determining the legal heirs. In order to perform
this duty, BIA, OHA and OST must coordinate their work to accomplish the
probate process.

**[Accomplishments and Completions]{.underline}**

**Case Preparation**

As of the end of this reporting period, 8,300 probate cases were in the
case preparation stage.

**Case Adjudication**

In this reporting period, deciding officials received 1,873 cases and
issued decisions in 1,573 cases.

**Case Closure**

At the end of this reporting period, 5,221 cases were in the closing
stage. Cases in the closing stage are ones that have been adjudicated
but not distributed either in TFAS or LTRO.

**Financial Case Closure**

In this reporting period, OST distributed funds, and closed 1,528
accounts in TFAS representing 1,496 estates. As of the end of September
2005, TFAS contained 30,236 open estate accounts, which is an increase
of 93 from the 30,143 estate accounts at the end of the last reporting
period.

**[Current Status]{.underline}**

**Probate Case Management and Tracking System**

Each BIA regional office and corresponding agency continued the process
of encoding new cases, examining "initial load" cases and making
corrections. Data cleanup continued for this period, with ProTrac now
the source of probate data.

**Probate Handbook**

During this reporting period, a Regulatory Initiative working group
drafted language implementing the probate provisions of AIPRA. Until
this initiative is completed, publication of the probate handbook is
expected to be deferred.

**[Delays and Obstacles]{.underline}**

The following obstacles have been identified as having an impact on the
progress of the probate program:

-   Lack of access to the Internet, which includes the inability to use
    electronic mail communication between OHA and BIA/OST;

-   Continued fractionation of ownership of Indian lands;

-   Numerous initiatives competing for resources (e.g., *Youpee*
    revestitures, *Cobell* requirements);

-   Cultural diversities regarding the subject of death;

-   Completion of implementation of the probate reorganization.

**[Assurance Statement]{.underline}**

I concur with the content of the information contained in the Probate
section of the *Status Report to the Court Number Twenty-Three*. The
information provided in this section is accurate to the best of my
knowledge.

Date: October 26, 2005

Name: *Signature on File*

William Titchywy

Acting Special Projects Director

Western Region

Bureau of Indian Affairs

[]{#__RefHeading___Toc118515814 .anchor}**ACRONYMS AND ABBREVIATIONS**

1994 Act (or Act) American Indian Trust Fund Management Reform Act of
1994

A-130 Office of Management and Budget Circular A-130 Appendix III

ADM Attorney Decision Makers

AFMSS Automated Fluid Mineral Support System

AIPRA American Indian Probate Reform Act

AIRR American Indian Records Repository

ALIS Alaska Land Information System

ALJ Administrative Law Judges

ARO Alaska Region office

ART Accounting Reconciliation Tool

AS-IA Assistant Secretary-Indian Affairs

ASD Appraisal Services Directorate

ATO authority to operate

BIA Bureau of Indian Affairs

BIAM Bureau of Indian Affairs Manual

BISS Box Index Search System

BLM Bureau of Land Management

BOR Bureau of Reclamation

BPA Blanket Purchase Agreement

BRM Business Reference Model

C&A Certification and Accreditation

CARS Cadastral Automated Request System

CDE Critical Data Elements

CFedS Certified Federal Surveyor

CFI Continuous Forest Inventory

CGI Software vendor successor to TAAMS vendor

CGIS Cadastral Geographic Information Systems

CIFTA Certified Indian Fiduciary Trust Analyst

CIFTS Certified Indian Fiduciary Trust Specialist

CIO Chief Information Officer

CIRC Computer Incidents Response Center

CISSP Certified Information System Security Professional

CMS Credential Management System

COTS Commercial off-the-shelf

CPIC Capital Planning and Investment Control

CSIRC Computer Security Incident Response Capability

CSIRT Computer Security Incident Response Team

CSS Customer StrataStation

CTM Comprehensive Trust Management Plan

DAA Designated Approving Authority

DEAR DOI Enterprise Architecture Repository

DDoS Distributed Denial of Service

DLRM DOI Land and Resource Management

DM Departmental Manual

DNS Domain Name Server

DOI Department of the Interior

DOP Desk Operating Procedure

DoS Denial of Service

DQ&I Data Quality and Integrity

DRM Data Reference Model

EA Enterprise Architecture

ENA Eastern Navajo Agency

EORO Eastern Oklahoma Region office

ERO Eastern Region office

ESN Enterprise Services Network

FAMS Facilities Asset Management System

FAR Federal Acquisition Regulation

FIMO Farmington Indian Minerals Office

FIPS Federal Information Processing Standards

FISMA Federal Information Security Management Act

FRC Federal Records Center

FRD Functional Requirements Document

FTM Fiduciary Trust Model

FTO Fiduciary Trust Officer

GAO Government Accountability Office

GCDB Geographic Coordinate Data Base

GIS Geographic Information System

GLADS Great Lakes Agency Database System

GPRO Great Plains Region office

GPS Global Positioning System

GSA General Services Administration

GSS General Support Systems

HSPD-12 Homeland Security Presidential Directive 12

IAM Indian Affairs Manual

IATO Interim Approval to Operate

IEA Interior Enterprise Architecture

IFTR Indian Fiduciary Trust Records

IG Inspector General

IIM Individual Indian Money

IITD Individual Indian Trust Data

ILCA Indian Land Consolidation Act

ILCO Indian Land Consolidation Office

ILCP Indian Land Consolidation Project

InfoDat Indian Forestry Database

Interior Department of the Interior

IP Internet Protocol

IPJ Indian Probate Judges

IPv6 Internet Protocol Version 6

IQCS Incidence Qualification and Certification System

IRM Information Resources Management

IRMS Integrated Records Management System

IRS Internal Revenue Service

ISA Information Security Assessment

IT Information Technology

IV&V independent verification and validation

LAN Local area network

LCTS Land Consolidation Tracking System

LR2000 Legacy Rehost 2000 System

LRIS Land Records Information System

LTIC Land Tenure in Indian Country

LTRO Land Titles and Records Office

MA Major Applications

MAD/LCP Management Accounting Distribution/Land Consolidation Program

MADS Management Accounting Distribution System

MMD Missing Mandatory Documents for Unrestricted Accounts

MMS Minerals Management Service

MOU Memorandum or Memoranda of Understanding

MRM Minerals Revenue Management

MRMSS Minerals Revenue Management Support System

MWRO Midwest Region office

NARA National Archives and Records Administration

NBC National Business Center

NILS National Integrated Lands System

NIPTC National Indian Programs Training Center

NIST National Institute of Standards and Technology

NPS National Park Service

NRO Navajo Region office

NWRO Northwest Region office

O&G Oil and Gas

OAS Office of Appraisal Services

OCIO Office of the Chief Information Officer

OHA Office of Hearings and Appeals

OHTA Office of Historical Trust Accounting

OIG Office of the Inspector General

OME Office of Minerals Evaluation

OMB Office of Management and Budget

OSM Office of Surface Mining

OST Office of the Special Trustee for American Indians

OTFM Office of Trust Funds Management

OTP Office of Trust Regulations, Policies and Procedures

OTR Office of Trust Records

OTRA Office of Trust Review and Audit

PAR Performance Accountability Report

PLSS Public Land Survey System

PMSO Project Management Support Office

POA&M Plans of Actions and Milestones

Post-QA Post Quality Assurance

PPA Office of Planning and Policy Analysis

PRIS Production and Response Information System

PRO Pacific Region office

ProTrac Probate Case Management and Tracking System

QA Quality Assurance

QC Quality Control

RAF Recommended Action Forms

RAS Rangeland Administration System

RDRS Royalty Distribution and Reporting System

REM Real Estate Module

RFP Request for Proposal

RM-PLUS Risk Management Assessment/Evaluation tool

RMRO Rocky Mountain Region office

ROW Rights-of-Way

SANS SysAdmin, Audit, Network, Security

SCADA Supervisory Control and Data Acquisition

SDA Special Deposit Accounts

SDLC System Development Life Cycle

SMEs Subject Matter Experts

SMS System Management Servers

SOL Office of the Solicitor

SPRO Southern Plains Region office

SSA Social Security Administration

SSM System Security Manager

SSP System Security Plan

ST&E Security Test and Evaluation

STIGs Security Technical Implementation Guides

SUS System Update Servers

SWRO Southwest Region office

TAAMS Trust Asset and Accounting Management System

TAP Technical Architecture Profile

TBCC Trust Beneficiary Call Center

TESC Trust Executive Steering Committee

TFAS Trust Fund Accounting System

TPMC Trust Program Management Center

TRAC Trust Tracking and Coordination

Treasury Department of the Treasury

TRM Technical Reference Model

TRO Temporary Restraining Order

UAT User Acceptance Testing

USGS United States Geological Survey

USPAP Uniform Standards of Professional Appraisal Practice

VBNS Very High Performance Backbone Network Service

VPN Virtual Private Network

WAN Wide area network

WAU Whereabouts Unknown

WRO Western Region office

[^1]: This report contains information on the broad trust reform efforts
    underway at Interior. Accordingly, it may include information on
    reform efforts that are not within the scope of the *Cobell*
    litigation.