Interior off-pace in getting online

About 90 percent of the Interior Department remains off-line, Interior Secretary Gale Norton testified before the House Resources Committee Feb. 6.

U.S. District Judge Royce Lamberth pulled the plug on Interior's Internet connection in December after a computer security firm broke into its systems and reportedly cut a check from funds held in trust for American Indians.

Norton expects to bring the "core of the dedicated network" into compliance during fiscal 2002.

"It is unfortunate, but true, that through both Democrat and Republican administrations the Interior Department has acted like the Enron of federal agencies when it comes to managing Indian trust assets," Rep. Nick Rahall (D-W.Va.) said in opening remarks at the hearing.

To break the cycle of mismanagement, Norton proposed in November 2001 that trust fund duties be reorganized into a new Bureau of Indian Trust Asset Management (BITAM).

But the concept has met opposition from politicians and trust beneficiaries.

"This plan was developed with no input from Indian tribes or account holders," Rahall said. "It was a huge mistake, causing process to become the issue instead of what really is the matter at hand, which is, whether each individual Indian and tribal account accurately reflects the amount of money it should contain."

Norton contended the plan was proposed as a general idea and Interior is now moving forward to flesh it out in consultation with tribal leaders.

The beneficiaries who filed a lawsuit have asked Lamberth to place individual trust accounts in receivership out of Interior's control. Whether Congress favors BITAM or another approach — for instance, forming a separate entity to take over management of American Indian holdings — a lot of data needs to be sorted.

Trust records have been lost over time, Norton said. A comprehensive historical trust accounting is likely to cost hundreds of millions of dollars, she said.

The Trust Asset and Accounting Management System, which Interior began developing in 1998 from an off-the-shelf program to improve the situation, has been inadequate, Norton said. "Also our IT security measures lack integrity," she added.

Meanwhile, some tribes have created their own systems.

"We have our own accounting system, which has passed stringent accounting audits," said Fred Matt, chairman of the Confederated Salish and Kootenai Tribes of the Flathead Nation. "I believe it's a solution."

The 15-year-old computer system manages at least 6,000 accounts, and Matt said it was able to issue checks to beneficiaries even after Interior was shut down.

In contrast, to make many of its payments, Interior needs to reconnect the Minerals Management Service, which receives royalties from companies extracting from lands held in trust for American Indians.

"It was my hope we would be able to get those systems back online [faster] than we have been able to do so," Norton said.

But Special Master Allan Balaran, a court-appointed investigator, said Interior shouldn't be surprised with the pace.

"Given its disgraceful legacy protecting Indian trust data, Interior could not realistically have envisioned that the special master would not exhaust every reasonable avenue to assure himself and the Court that Indian trust data was as secure as present circumstances allow," Balaran said in his second status report released this week.

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