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Cobell Settlement to Begin Paying Out by Christmas

Secretary of the Interior Ken Salazar announced this week that the federal government was set to release funds designated for the approximately 350,00

The checks are soon to be in the mail.

Those long-awaited words for many in Indian country came from Secretary of the Interior Ken Salazar when he announced this week that the federal government was set to release funds designated for the approximately 350,000 Indian class members affected by the $3.4 billion Cobell settlement.

The agreement between the federal government and the Cobell lawyers and lead plaintiffs was first announced in December 2009. It cleared Congress in 2010, and made it through an appeals process that included review by the U.S. Supreme Court on November 24.

“With the settlement now final, we can put years of discord behind us and start a new chapter in our nation-to-nation relationship,” Salazar said in a press release. “Today marks another historic step forward in President [Barack] Obama’s agenda of reconciliation and empowerment for Indian country and begins a new era of trust administration.”

Obama also released his own statement hailing the end of the contentious case and settlement.

“I welcome the final approval of the Cobell settlement agreement, clearing the way for reconciliation between the trust beneficiaries and the federal government,” the president said. “While Elouise Cobell, the named plaintiff in this case is no longer with us, her legacy will be a renewed commitment to our trust relationship with Indian country. I thank her for her honorable work, and also want to thank the leaders at the Departments of the Interior, Justice and Treasury who helped reach this conclusion.”

The president is expected to talk about the case and settlement on December 5 at his fourth White House Tribal Nations Conference since taking office.

Cobell passed away in October 2011 after having battled an unnamed type of cancer. The Blackfeet citizen began the case in 1996, arguing that the Interior Department has mismanaged billions of dollars in Indian trust funds and accounts.

Dennis Gingold, lead lawyer for the Cobell legal team, has told class members that they could begin receiving checks by Christmas.

"We all are happy that this settlement can finally be implemented," Gingold said in a statement. "We deeply regret that Ms. Cobell did not live to see this day."

Lawyers for the Cobell plaintiffs are scheduled to receive approximately $100 million under the deal. Most class members will receive less than $2,000.

Included in the $3.4 billion settlement is a $1.9 billion set-aside for the Interior Department to start a land consolidation program that will allow for the voluntary sale of individual land interests that have fractionated, or split among owners, over years of complex federal policy.

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The rest of the money – $1.5 billion, less lawyers’ fees – will be divided among the Indian class members.

“This marks the historic conclusion of a contentious and long running period of litigation,” Hilary Tompkins, Solicitor for the Department of the Interior, added in a statement. “Through the hard work and good will of plaintiffs, Interior and Treasury officials and Department of Justice counsel, we are turning a new page and look forward to collaboratively working with Indian country to manage these important funds and assets.”

The Department of the Interior offered the following details on payments:

Payments to Claimants

The Claims Administrator will now begin overseeing disbursement of the $1.5 billion to nearly 500,000 class members. The court previously approved GCG, Inc., as the Claims Administrator. The Department of the Treasury will transfer the $1.5 billion to an account at JP Morgan Chase, a bank approved by the court. Per the terms of the settlement agreement, Interior’s Office of the Special Trustee (OST) has assisted GCG with its database by supplying contact information of individual class members from its records.

“We will continue to work with GCG to ensure it has the information it needs to make expeditious and accurate payments,” Deputy Secretary of the Interior David J. Hayes said. “At the same time, we’re focused on making meaningful improvements to our trust administration so that we’re more transparent, responsive and accountable in managing these substantial funds and assets.”

Trust Land Consolidation Program

The Department of the Interior will use $1.9 billion from the Trust Land Consolidation Fund to acquire interests in trust and restricted lands that have “fractionated” over successive generations since the 1880s.

Individual owners will be paid fair market value for such interests with the understanding that the acquired interests will remain in trust and be consolidated for beneficial use by tribal communities. Interested sellers may convey their fractional interests on a voluntary basis. Currently, there are over 2.9 million fractional interests owned by approximately 260,000 individuals.

While the settlement was pending, Interior held a series of consultation meetings with tribes in 2011 to ensure that this landmark program incorporates tribal priorities and promotes tribal participation in reducing land fractionation in a timely and efficient way. These discussions informed a draft land consolidation plan released in February of 2012. Interior is incorporating public comments and expects to release an updated plan by the end of the year for additional consultation.

“The land consolidation program is our chance to begin to solve a fractionation problem that has plagued Indian country for decades,” said Interior Assistant Secretary of Indian Affairs Kevin K. Washburn. “We are anxious to get started. We know that Interior’s continued outreach through consultations with Indian Country is a crucial component to accomplishing truly open government-to-government communication”

Information about payments should be directed to GCG, Inc. at 1-800-961-6109 or via e-mail at, Interior officials said.