I
103D CONGRESS
1ST SESSION
H. R. 1846
To require the Secretary of the Interior to pay interest on Indian funds
invested, to authorize demonstrations of new approaches for the manage-
ment of Indian trust funds, to clarify the trust responsibility of the
United States with respect to Indians, to establish a program for the
training and recruitment of Indians in the management of trust funds,
to account for daily and annual balances on and to require periodic
statements for Indian trust funds, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 22, 1993
Mr. SYNAR introduced the following bill; which was referred to the Committee
on Natural Resources
A BILL
To require the Secretary of the Interior to pay interest
on Indian funds invested, to authorize demonstrations
of new approaches for the management of Indian trust
funds, to clarify the trust responsibility of the United
States with respect to Indians, to establish a program
for the training and recruitment of Indians in the man-
agement of trust funds, to account for daily and annual
balances on and to require periodic statements for Indian
trust funds, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Native American Trust
Fund Accounting and Management Reform Act of 1993’’.
SEC. 2. DEFINITIONS.
For purposes of this Act—
(1) the term ‘‘Secretary’’ means the Secretary
of the Interior; and
(2) the term ‘‘Bureau’’ means the Bureau of
Indian Affairs of the Department of the Interior.
TITLE I—TRUST FUND INTEREST
PAYMENTS
SEC. 101. PAYMENT OF INTEREST ON FUNDS INVESTED.
(a) PAYMENT OF INTEREST.—(1) The fourth proviso
of subsection (a) of the first section of the Act of June
24, 1938 (25 U.S.C. 162a), is amended by striking ‘‘may
invest’’ and inserting ‘‘shall invest’’.
(2) The first section of the Act of June 24, 1938 (25
U.S.C. 162a), is amended by adding at the end the follow-
ing new subsection:
‘‘(d) Amounts deposited or invested under subsection
(a) shall earn interest at the appropriate rates, taking into
consideration the type of deposit or investment. The Sec-
retary shall periodically pay such interest to the appro-
priate Indian tribe or individual Indian or, at the election
of the Indian tribe or individual Indian, add such interest
to the principal so deposited or invested.’’.
(b) TECHNICAL
CORRECTION.—The second sub-
section (b) of the first section of the Act of June 24, 1938
(25 U.S.C. 162a), as added by section 302 of Public Law
101–644 (104 Stat. 4667), is hereby redesignated as sub-
section (c).
(c) REPEAL OF LIMITATION ON UNITED STATES LI-
ABILITY.—Paragraph (2) of subsection (c) of the first sec-
tion of the Act of June 24, 1938, as amended by sub-
section (b), is amended to read as follows:
‘‘(2) Amounts deposited or invested under this sub-
section shall generate earnings at the appropriate rates,
taking into consideration the type of investment con-
cerned. The Secretary shall periodically pay such earnings
to the appropriate Indian tribe or individual Indian or,
at the election of the Indian tribe or individual Indian,
add such earnings to the principal of such funds so
invested.’’.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to interest earned on amounts de-
posited or invested on or after the date of the enactment
of this Act.
SEC. 102. AUTHORITY FOR PAYMENT OF CLAIMS FOR IN-
TEREST OWED.
The Secretary is authorized to make payments to an
Indian tribe or an individual Indian—
(1) in full satisfaction of any claim of such In-
dian tribe or individual Indian for interest on
amounts deposited or invested on behalf of such In-
dian tribe or individual Indian before the date of en-
actment of this Act under the Act of June 24, 1938
(25 U.S.C. 162a), and who was not paid the appro-
priate amount of interest on such funds; and
(2) in an amount equal to the interest which
would have been earned if funds of such Indian tribe
or individual Indians which were subject to the Act
of June 24, 1938 (25 U.S.C. 162a), had been depos-
ited or invested in accordance with such Act.
TITLE II—INDIAN TRUST FUND
MANAGEMENT 
DEMONSTRA-
TION PROGRAM
SEC. 201. PURPOSE.
The purpose of this title is to demonstrate new ap-
proaches for the management of tribal and individual In-
dian funds held in trust by the United States and man-
aged by the Secretary through the Bureau, that, consist-
ent with the trust responsibility of the United States and
the principles of self-determination, will—
(1) give Indian tribal governments and individ-
ual Indian account holders greater control over the
management of such trust funds;
(2) pursuant to tribal instructions, involve in-
vestment of such trust funds by the Secretary in a
manner that will also help to promote economic
development in Indian communities; or
(3) otherwise demonstrate how the principles of
self-determination can work with respect to the man-
agement of such trust funds, in a manner consistent
with the trust responsibility of the United States.
SEC. 202. DEFINITION.
For the purposes of this title, except for the purposes
of section 208, the terms ‘‘Indian tribe’’ and ‘‘tribe’’
mean—
(1) an Indian tribe;
(2) a consortia of Indian tribes; or
(3) an association of Indians holding individual
Indian trust fund accounts managed by the Sec-
retary through the Bureau.
SEC. 203. DEMONSTRATION PLANS.
An Indian tribe may submit to the Secretary a plan
to demonstrate a new approach for the management of
tribal or individual Indian funds held in trust by the Unit-
ed States for such tribe or the members of such tribe, and
as of the date of the enactment of this Act, managed by
the Secretary through the Bureau. Such plan may provide
for the following:
(1) Management of such funds directly by the
Indian tribe in financial institutions selected by the
tribe, subject to supervision and oversight by the
Secretary. For the purposes of this section, the term
‘‘management’’ may include one or more of the func-
tions carried out, as of the date of the enactment of
this Act, by the Secretary through the Bureau in
managing such funds, such as collection, disburse-
ment, and investment functions.
(2) Management of such funds by the Secretary
in a manner that—
(A) involves investment of such funds in fi-
nancial institutions on or near the reservation;
(B) increases tribal access to such institu-
tions;
(C) promotes economic development activi-
ties on the reservation; or
(D) otherwise promotes tribal priorities.
(3) Management of such funds at the local level
through contracts with local financial institutions
that meet the purposes of this title.
(4) Such other approaches, as determined by
the Secretary, that meet the purpose of this title.
SEC. 204. APPROVAL OF PLANS BY THE SECRETARY.
(a) IN GENERAL.—The Secretary shall approve and
implement, or provide for the implementation by an Indian
tribe of, a plan that meets the following conditions:
(1) Such plan has been approved by the appro-
priate Indian tribe, as follows:
(A) For a plan involving tribal trust funds,
such plan is accompanied by a resolution from
the tribal governing body approving the plan.
(B) For a plan submitted by an Indian
tribe (as defined in paragraphs (1) and (2) of
section 202) involving individual Indian money
accounts, where most or all of the account hold-
ers are members of the submitting tribe, it is
accompanied by a resolution from the tribal
governing body approving the plan, along with
a certification that the tribe held no fewer than
2 public meetings to provide an opportunity for
account holders to comment on the plan.
(C) For a plan submitted by an Indian
tribe (as defined in paragraph (3) of section
202), it is accompanied by a written approval
signed by each participating account holder,
along with a certification that the tribe on
whose reservation the trust asset that is the
source of the funds is located, has been con-
sulted regarding the plan.
(2) The Secretary determines such plan to be
consistent with standards of reasonable prudence,
after considering all appropriate factors, including
but not limited to the following:
(A) The capability and experience of the
individuals or institutions that will be managing
the trust funds.
(B) The protection against substantial loss
of principal.
(C) The rate of return, provided that the
plan need not produce the highest rate of re-
turn possible if the Indian tribe chooses to ac-
cept a lower rate in return for other benefits
such as the benefits from investing in local fi-
nancial institutions.
(D) The ability of the Secretary to effec-
tively monitor the demonstration, pursuant to
the trust responsibility of the United States as
specified in section 205.
(3) The duration of the plan does not exceed 5
years.
(b) INVESTMENT IN EQUITIES.—Nothing in this sec-
tion shall prohibit an Indian tribe submitting a plan for
(b) DECREASE IN INTEREST AND LOSS OF PRIN-
CIPAL.—If a plan for a demonstration submitted under
this title and approved by the Secretary provides for the
implementation of such demonstration by the Secretary,
the United States shall not be liable, during the period
of such demonstration, for any decrease in interest rate
or any loss of principal that is proximately caused by the
Secretary’s prudent implementation of such demonstra-
tion.
(c) AGREEMENT.—Prior to the implementation of
any demonstration under this title, the Indian tribe in-
volved shall sign a written statement indicating that it un-
derstands and accepts the limitations on the trust respon-
sibility of the United States as provided in this section.
SEC. 206. TECHNICAL AND FINANCIAL ASSISTANCE.
The Secretary shall, directly or by contract, provide
Indian tribes with technical and financial assistance in de-
veloping, implementing, and managing plans for dem-
onstrations under this title.
SEC. 207. NO INCOME TAX CONSEQUENCES.
Funds managed pursuant to a demonstration pro-
gram under this title, and distributions made from such
funds, shall, for purposes of the Internal Revenue Code
of 1986, be treated in the same manner as such funds
would be treated if such funds were managed directly by
the Secretary, through the Bureau.
SEC. 208. VOLUNTARY WITHDRAWAL FROM TRUST FUND
PROGRAM.
(a) IN GENERAL.—An Indian tribe may, in accord-
ance with this section, submit a plan to withdraw some
or all funds held in trust for such tribe by the United
States and managed by the Secretary through the Bureau.
(b) APPROVAL OF PLAN.—The Secretary shall ap-
prove a plan under this section that meets the require-
ments specified in section 204(a)(1) and subparagraphs
(A) and (B) of section 204(a)(2).
(c) TERMINATION OF TRUST RESPONSIBILITY.—Be-
ginning on the date funds are withdrawn pursuant to this
section, any trust responsibility of the United States with
respect to such funds shall terminate.
SEC. 209. REPORT TO CONGRESS.
The Secretary shall, beginning one year after the date
of the enactment of this Act, submit an annual report to
the Congress on the implementation of demonstration pro-
grams under this title. Such report shall include rec-
ommendations for changes necessary to effectively imple-
ment the purpose of this title.
TITLE III—RECOGNITION OF
TRUST RESPONSIBILITY
SEC. 301. AFFIRMATIVE ACTION REQUIRED.
The first section of the Act of June 24, 1938 (25
U.S.C. 162a), as amended by section 101(a)(2), is
amended by adding at the end the following new sub-
section:
‘‘(e) The Secretary shall properly discharge the trust
responsibilities of the United States under this section
by—
‘‘(1) providing adequate systems for accounting
for and reporting trust fund balances;
‘‘(2) providing adequate controls over receipts
and disbursements;
‘‘(3) providing periodic, timely reconciliations to
assure the accuracy of accounts;
‘‘(4) determining accurate cash balances;
‘‘(5) preparing and supplying account holders
with meaningful periodic statements of their account
balances;
‘‘(6) establishing consistent, written policies and
procedures for trust fund management and account-
ing; and
‘‘(7) providing adequate staffing, supervision,
and training for trust fund management and ac-
counting.’’.
SEC. 302. TRUST RESPONSIBILITY WITH RESPECT TO NATU-
RAL RESOURCES.
The Congress recognizes that the trust responsibility
of the United States extends to tribal and individual In-
dian owners of natural resources located within the bound-
aries of Indian reservations and trust lands. This includes
the fiduciary responsibility to manage funds held in trust
by the United States for Indian tribes and individual Indi-
ans derived from actions including, but not limited to, the
use and sale of leased lands, judgments, mineral leases,
oil and gas leases, timber permits and sales, and water
resources.
TITLE IV—TRAINING AND
PERSONNEL
SEC. 401. TRAINING.
(a) TRAINING PROGRAM.—The Secretary shall estab-
lish a program to assist Indians, including, but not limited
to, employees of the Bureau and members and employees
of Indian tribes, to obtain expertise in the management
of trust funds. Components of such program may include
the following:
(1) An outreach program to encourage and as-
sist Indians to obtain employment with private fi-
nancial institutions.
(2) Agreements with financial institutions and
other entities under which such entities would pro-
vide classroom training, on-the-job training, intern-
ships, and employment opportunities not to exceed 2
years, for employees and prospective employees of
the Bureau.
(b) RECRUITMENT.—
(1) EMPLOYMENT
DESCRIPTIONS.—The Sec-
retary shall ensure that the employment description
for any Federal position related to the management
of Indian trust funds contains requirements nec-
essary to ensure that a person filling such position
would have the necessary skills, based on industry
standards, to fully perform the position’s responsibil-
ities in a manner consistent with the responsibility
of the United States to properly manage Indian
trust funds.
(2) PAY.—The Secretary, in consultation with
the Office of Personnel Management, shall establish
the rate of pay payable for a position related to the
management of Indian trust funds at a level of the
General Schedule appropriate for such position.
(c) INDIAN PREFERENCE.—Nothing in this title shall
authorize or permit any waiver of Indian preference laws
as such term is defined in section 2(f)(2) of Public Law
96–135 (25 U.S.C. 472 et seq.).
TITLE 
V—RESPONSIBILITY 
TO
ACCOUNT FOR INDIAN TRUST
FUNDS
SEC. 501. RESPONSIBILITY OF SECRETARY TO ACCOUNT
FOR THE DAILY AND ANNUAL BALANCES OF
INDIAN TRUST FUNDS.
(a) REQUIREMENT
TO ACCOUNT.—The Secretary
shall account for the daily and annual balance of all funds
held in trust by the United States for the benefit of an
Indian tribe or an individual Indian which are deposited
or invested pursuant to the Act of June 24, 1938 (25
U.S.C. 162a).
(b) PERIODIC STATEMENT OF PERFORMANCE.—Not
later than 10 business days after the close of a calendar
month, the Secretary shall provide a statement of perform-
ance to each Indian tribe and individual with respect to
whom funds are deposited or invested pursuant to the Act
of June 24, 1938 (25 U.S.C. 162a). The statement, for
the period concerned, shall—
(1) identify the source, type, and status of the
funds;