IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA _________________________________ ELOUISE PEPION COBELL, et al., ) Plaintiffs, v. ) ) ) ) ) GALE A. NORTON, Secretary of the Interior, et al., ) )) ) Defendants. _________________________________) NOTICE OF FILING OF INTERIOR DEFENDANTS' SEVENTEENTH STATUS REPORT Interior Defendants hereby give notice of the filing of their seventeenth report due in accordance with the Order of December 21, 1999. A copy of the report is attached hereto. Dated: May 3, 2004 Case No. 1:96CV01285 (Judge Lamberth) Respectfully submitted, ROBERT D. McCALLUM, JR. Associate Attorney General PETER D. KEISLER Assistant Attorney General STUART E. SCHIFFER Deputy Assistant Attorney General J. CHRISTOPHER KOHN Director SANDRA P. SPOONER Deputy Director DC Bar No. 261495 /s/ John T. Stemplewicz JOHN T. STEMPLEWICZ Senior Trial Counsel Commercial Litigation Branch Civil Division P.O. Box 875 Ben Franklin Station Washington, D.C. 20044-0875 (202) 307-1104 CERTIFICATE OF SERVICE I hereby certify that, on May 3, 2004 the foregoing Notice of Filing of Interior Defendants’ Seventeenth Status Report as served by Electronic Case Filing, and on the following who is not registered for Electronic Case Filing, by facsimile: Earl Old Person (Pro se) Blackfeet Tribe P.O. Box 850 Browning, MT 59417 Fax (406) 338-7530 /s/ Kevin P. Kingston Kevin P. Kingston Status Report to the Court Number Seventeen For the Period January 1, 2004 through March 31, 2004 TN S DEPART M E U T HE I NTERIOR MARCH 3, 184 9 May 3, 2004 1 STATUS REPORT TO THE COURT NUMBER SEVENTEEN May 3, 2004 SECRETARY GALE NORTON’S OBSERVATIONS................................................. 3 TABLE OF CONTENTS I. INTRODUCTION............................................................................................................. 2 II. A. INFORMATION TECHNOLOGY................................................................................. 5 B. CADASTRAL SURVEY................................................................................................ 10 C. MINERALS MANAGEMENT SERVICE................................................................... 14 D. OFFICE OF HISTORICAL TRUST ACCOUNTING ............................................... 16 III. OFFICE OF THE SPECIAL TRUSTEE FOR AMERICAN INDIANS................... 25 A. TRUST REVIEW AND AUDIT.................................................................................... 28 B. OFFICE OF THE CHIEF INFORMATION OFFICER............................................ 31 1. RECORDS MANAGEMENT.................................................................................... 31 C. TRUST ACCOUNTABILITY....................................................................................... 34 1. TRUST BUSINESS PROCESS MODELING.......................................................... 34 2. TRUST DATA QUALITY AND INTEGRITY........................................................ 37 3. INDIAN FIDUCIARY TRUST TRAINING PROGRAM...................................... 40 4. RISK MANAGEMENT.............................................................................................. 42 5. REGULATIONS, POLICIES AND PROCEDURES.............................................. 44 D. FIELD OPERATIONS................................................................................................... 47 1. APPRAISAL................................................................................................................ 47 E. TRUST SERVICES ........................................................................................................ 50 1. CURRENT ACCOUNTING ACTIVITIES ............................................................. 50 IV. BUREAU OF INDIAN AFFAIRS................................................................................. 55 A. TRUST REGULATIONS, POLICIES AND PROCEDURES ................................... 55 B. FRACTIONATION........................................................................................................ 58 C. PROBATE ....................................................................................................................... 60 ACRONYMS AND ABBREVIATIONS................................................................................... 63 1 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Introduction May 3, 2004 INTRODUCTION I. This Status Report to the Court Number Seventeen (Report) represents the period from January 1, 2004, through March 31, 2004. 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 progress of their respective activities. In previous reports, a separate section was provided on the implementation of the Comprehensive Trust Management Plan. Beginning with this Report, a separate CTM section will not be included. CTM is a guide for trust reform, and is being implemented through the work of the managers. If there are significant changes in CTM in the future, these changes will be brought to the Court’s attention in the OST section of the Report. CTM also is being implemented through the development of the “To-Be” process that is examining all trust business processes in order to create the most effective and efficient way of delivering trust services. Implementation of the “To-Be” business processes will continue to be reported in the Trust Accountability sections. The deadline for receipt of comments on the “To-Be” draft model was March 31, 2004. Comments are expected to be considered for incorporation into the final model that is due by the end of May 2004. The proposed FY2005 Interior budget was announced during this reporting period. A substantial increase in funds to resolve fractionation and perform historical accounting is included. As the Court is aware, limitations were put on expenditures for historical accounting in the FY2004 budget. The Interior budget for historical accounting was reduced by nearly two thirds from the request to Congress. Funding to accomplish historical accounting is proposed for FY2005 and has been submitted to Congress for consideration. In addition, substantial increases in the budget for reducing fractionated ownership of Indian lands are being requested for FY2005. Although the certification for the IT section of this report again has been signed by the Associate Deputy Secretary, Mr. James E. Cason, it is expected that future reports will be signed by Interior’s Chief Information Officer. Due to the complexity of IT issues in the various bureaus and offices of Interior that affect the Indian trust, it is believed that the CIO is the most appropriate person to report on the status of these programs. A glossary of acronyms and abbreviations is included in this Report. The glossary is located at the end of the Report. 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. 2 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Secretary Gale Norton’s Observations May 3, 2004 II. SECRETARY GALE NORTON’S OBSERVATIONS Introduction The first three months of 2004 have seen some noteworthy movement in trust reform and the course of this litigation. After several meetings with plaintiffs and staff from the Congressional authorizing committees, two mediators were selected. The mediators are to work with both parties in an effort to seek a middle ground in this litigation. The “To-Be” comments from Tribes and the public are in and will be carefully considered during the next two months at which time Interior plans to commence the most significant reengineering of trust business processes in years. Fiduciary trust officers are being deployed in Indian country, marking the first time trust beneficiaries will have a trust officer dedicated to responding to their land and financial issues. David Anderson, whose background was described in one of our previous reports, took office as Assistant Secretary - Indian Affairs. To-Be Model The draft “To-Be” Model is in its final stages. Although this Model is expected to bring a major change in the way the fiduciary trust business is conducted, it will not solve all the problems associated with the Indian trust. The structural problems of the trust will remain. The lack of a normal cost-benefit paradigm within the trust perpetuates administrative responsibilities that are not cost effective or materially helpful to Indian beneficiaries. For example, fractionation of land titles will continue to require Interior to account for ever increasing numbers of accounts with decreasing balances. We now have over 21,000 accounts containing less than one dollar, and the number of these accounts is growing. Moreover, we have now reached the point where the cost of administrating the trust often exceeds the return being received by the individual beneficiary. Congress, Interior, and beneficiaries must work together to address this imbalance so that Interior may better steward its appropriated funds for the benefit of Indian country and overall Indian programs. Interior is, for example, working with Congress on legislation to improve the probate process. Information Technology During this reporting period, the Court again ordered Interior to disconnect from the Internet. The stay entered by the Court of Appeals permits some of Interior to use Internet-based tools for a host of important missions (although the Bureau of Indian Affairs, the Office of the Special Trustee for American Indians and the Solicitor’s Office generally remain offline). Monthly scanning results have demonstrated the significant reduction in potential risk associated with unauthorized access from the Internet. The Internet is critical to Interior, for it allows us to do everything from accepting national park reservations to providing research tools in Indian schools to disbursing millions of dollars in oil and gas revenue to states, Indian Tribes, and individual Indians. 3 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Secretary Gale Norton’s Observations May 3, 2004 Congressional Activity During this reporting period, Interior, plaintiffs and the House and Senate authorizing committees’ staffs, on a bipartisan basis, have been very involved in seeking a mediated solution to the Cobell litigation. During the preparation of this Report, the parties agreed upon two mediators: Charles Renfrew, recommended by the plaintiffs as a “stature” mediator, and John Bickerman, recommended by Interior as a “professional” mediator. Substantive discussions also recently began, and Interior is hopeful that the mediators will be able to facilitate a mutually acceptable resolution of the pending issues. In the meantime, we are requesting that Congress continue funding the initiatives necessary to meet our trust administrative functions and to continue the accounting effort. In the latter case, Congress reduced our FY2004 appropriation request from $130 million to $45 million. In addition, restrictive language was added directing the accounting towards certain areas of work. Our 2005 budget request includes $109 million for historical accounting, including tribal accounts, and $75 million to support a large increase in the Indian land consolidation effort. Trust Initiatives for the 21st Century Throughout this Report, managers are reporting on activities that happened during the previous three months. Nearly every section of this report contains references to trust initiatives, either as a result of improving the organizational model of BIA and OST or moving forward on the “To- Be” Model development. The Assistant Secretary - Indian Affairs and the Special Trustee have agreed that these initiatives, taken together, should facilitate improved management as we move into the 21st Century. For the first time since the trust was established in 1887, beneficiaries will be able to direct their concerns to a dedicated fiduciary trust officer. Moreover, streamlining BIA’s administrative processes will allow for better organizational management of accounting, budget and information technology. It will also provide a separate organizational structure for the fiduciary trust, thus partially separating the management of the fiduciary trust responsibilities from conflicting priorities and needs within BIA. Conclusion Trust reform remains a high priority for Interior, as it has been throughout my tenure. Interior welcomes the chance to dialogue with the participants in the mediation process. Interior also hopes to confer with Congress on the imbalance between the cost of administering the trust and the return received by individual beneficiaries. Through these initiatives and through refinement of the To-Be Model, deployment of trust officers throughout Indian country, and wise use of Information Technology resources, Interior expects to continue improving its services to trust beneficiaries. 4 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Information Technology May 3, 2004 A. INFORMATION TECHNOLOGY Introduction This section describes the status of Interior IT systems, particularly the systems that house or provide access to Individual Indian Trust Data 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, as required by OMB A-130 Appendix III, and the status of Internet connectivity. Accomplishments and Completions Computer Security: Interior continues to make progress in ensuring IT security and, in particular, measures to address the potential risks associated with unauthorized access, from the Internet, to IITD. The most noteworthy accomplishments and completions during this reporting period are described below. The Interior CIO attained the Certified Information System Security Professional (CISSP) certification, which brings the total number of Interior employees with a CISSP certificate to fifty-two. Through the end of this reporting period, FISMA requirements for annual IT security awareness training for system users had been completed by approximately 21,000 (28.9%) employees and contractors. Also during this reporting period, several Interior employees attended the RSA Conference on IT systems security. During the past year, Interior established a Computer Security Incident Response Capability (CSIRC), which is available 24 hours a day, seven days a week. Recently, Interior’s incident response program incorporated a CSIRC web portal to facilitate incident reporting as required by FISMA. Interior continued testing its wide area networks (WAN) against an operational security profile based on the “SysAdmin, Audit, Network, Security (SANS)/FBI Top 20” vulnerability list. The scanning process was changed to account for false positives in the reports. Bureaus identify and correct false positives before the final monthly report is produced. In the March 2004 report, there were no high-risk SANS/FBI Top 20 vulnerabilities identified in the perimeter telecommunications equipment exposed to the Internet. BLM refined the setting on its virus scanning software to improve detection and trapping of malicious software. New settings in SpamAssassin (BLM’s email spam blocking tool) blocked thousands of files which may have contained viruses in attachments. 5 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Information Technology May 3, 2004 MMS implemented Microsoft System Update Servers (SUS) and System Management Servers (SMS) to deploy critical security patches to servers and desktops. OST hired a permanent IT Security Manager. The IT Security Manager initiated information security assessments of the OST local area network and wide area network (LAN/WAN). A-130 Certification and Accreditation: To ensure continued progress in the C&A of Internet IT systems, Interior awarded contracts to 10 vendors to conduct C&A tasks. Most major applications and general support systems have received an Interim Approval to Operate (IATO). Approximately 20% of Interior’s major applications and general support systems have completed the C&A process. IT Systems Architecture: The DOI Enterprise Architecture Repository (DEAR) is operational and accessible by Interior bureaus and offices. DEAR contains Interior’s official inventory of IT systems. DEAR is being used as a decision support system for Interior's enterprise architecture program by determining opportunities for consolidating redundant systems, improving data sharing between systems and analyzing the underlying infrastructure of Interior's systems to improve interoperability and overall infrastructure management. As the official inventory of Interior's IT systems, DEAR currently tracks the security certification and accreditation status of Interior's systems. Interior is continuing efforts to implement a newer version of the CGI land title records system. The C&A assessment of the system was completed and the system received a recommendation for certification from independent vendors. The Trust Enterprise Architect and data standardization support contractor continued efforts to develop a data dictionary for trust data elements. The effort includes identifying common data elements to facilitate data exchanges between systems. The contractor mapped more than 5,700 standardized data elements. The Trust Data Dictionary serves as the control for the effort to standardize data elements. Current Status Audit Findings Database: The audit findings database contains a consolidated list of audit findings and recommendations for the key Interior bureaus and offices involved in individual Indian trust management. The database is being subdivided into two separate databases, one to reflect the key findings and recommendations cited or referenced in the Special Master’s November 2001 report and one to capture similar items in other IT reports. 6 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Information Technology May 3, 2004 The affected bureaus and offices report that more than 95% of the findings and recommendations in both databases have been addressed and resolved. An initial staff review indicates that none of the remaining open items pertain to the potential for unauthorized access from the Internet to IITD. Preliminary Injunction & Reconnection to the Internet: On March 15, 2004, the U.S. District Court issued a preliminary injunction that ordered most Interior IT systems to be disconnected from the Internet. On March 24, 2004, the U.S. Court of Appeals for the District of Columbia Circuit granted an administrative stay of the preliminary injunction. On April 7, 2004, the Court of Appeals granted a permanent stay pending appeal of the March 15 preliminary injunction. The Court of Appeals stay permitted Interior to reconnect selected IT systems to the Internet. Other Interior IT systems, serving BIA, OST, OHA and SOL, have been disconnected from the Internet since December 5, 2001. Continued disconnection from the Internet adversely impacts the operations of each of the affected entities. At the conclusion of this reporting period, these bureaus and offices had not been permitted access to the Internet for well over two years. Interior has appealed the July 28, 2003, and March 15, 2004, preliminary injunctions. On April 1, 2004, the Court of Appeals consolidated the government appeals. Oral argument is currently scheduled for September 14, 2004. A-130 Certification and Accreditation: In response to OMB guidance, Interior has been engaged in an effort to identify and catalogue its IT systems and applications in preparation for subsequent C&A activities. A subset of Interior’s systems and applications involve IITD. More than two thirds of those systems involving IITD are operated by bureaus or offices that have been without Internet connectivity since December 5, 2001, and most of those systems have received an IATO. The bureaus and offices housing the remaining approximately one third of systems with IITD were evaluated by the Special Master and permitted to reconnect to the Internet. All of these systems have received IATO. Full certification and accreditation work is ongoing for these reconnected systems. Architecture: ProTrac, Interior’s new probate case management system, underwent user acceptance testing during this reporting period. Representatives from BIA, OHA and OST jointly conducted the user acceptance testing. Interior is evaluating options for meeting short and long term needs for realty management systems. In accordance with the Federal Acquisition Regulation, Part 10, Interior conducted a market research meeting to determine if there are commercial sources available to satisfy Interior requirements. Using the referrals gathered from online research of vendors, nine companies 7 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Information Technology May 3, 2004 were invited to participate in a face-to-face information exchange meeting. The Trust Enterprise Architect and Interior subject matter experts are expected to use the information obtained during the meeting to improve the quality of the requirements specification for the upcoming government solicitation. Interior is also evaluating the relative capabilities and shortcomings of the realty software developed pursuant to the TAAMS program to determine if any other components besides the title portion can be salvaged for interim use. Reports: The OIG issued an audit report entitled “Improvements Needed in Managing Information Technology System Security National Park Service” Report No. A-IN-NPS-0074-2003, March 2004. As the Court has acknowledged that NPS does not house or provide access to IITD, the report may or may not be of interest to the Court. Delays and Obstacles There are many challenges that must be addressed regarding the integration, performance, funding, security, and data integrity of Interior IT systems. Interior initiated or completed steps to address some of the challenges reported in previous reporting periods. However, delays and obstacles listed here still impede progress to achieving Interior’s IT management goals:  Employee fears about becoming personally implicated in the Cobell litigation are undermining creativity and decision-making. This continues to be an impediment within Interior as contempt or other disciplinary actions against individuals working on this issue continue to be sought by plaintiffs.  Information system technical leadership and support staffs are insufficient. Bureau and office IT staffs are insufficient, and through normal attrition and budget restraints, the OCIO has several leadership and staff vacancies.  Funding availability will continue to dictate the timing of IT-related initiatives. Interior’s FY2004 budget will require Interior to manage a variety of IT-related requirements and tradeoffs. The government continually has to evaluate current funding requirements.  Interior is conducting a business process reengineering effort to standardize and streamline trust business processes. The “As-Is” portion of that process has been completed and the “To-Be” reengineering efforts are underway. IT systems specifications, design and procurement may depend upon the timing and results of the reengineering effort and available funding.  Several Interior bureaus and offices (BIA, OHA, OST, 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. 8 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Information Technology May 3, 2004  The additional resources (time, personnel and funding) provided for IT security have limited funding for a wide variety of other IT-related responsibilities, which may adversely impact overall systems performance and reform. Tradeoffs for an increased security posture may include adverse impacts on hiring skilled personnel for other aspects of Interior’s IT programs, funding for lifecycle replacement of hardware and software, or the ability to undertake IT-related initiatives. Assurance Statement I concur with the content of the information contained in the Information Technology section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. I plan to transition the responsibility for the preparation of this section of subsequent status reports to Interior’s Chief Information Officer. Date: April 30, 2004 Name: Signature on File James E. Cason Associate Deputy Secretary 9 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Cadastral Survey May 3, 2004 B. CADASTRAL SURVEY Introduction Cadastral surveys provide assurance that land boundaries for individual Indian trust and tribal lands are identified appropriately. By federal law, surveys of Indian lands are to be performed under BLM’s direction and control. Official surveys are conducted to identify the location of land boundaries of Indian trust assets, and to determine official acreage. The official surveys are integral to resource management activities, litigation support and the federal system of patent 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 Refinement of Survey Priorities During this reporting period, OST approved the refined priority driver ranking system, presented by BIA and BLM, in order to reflect the highest priority needs for cadastral services in FY2005. These priority drivers reflect the underlying reasons for performing a particular survey, and include such things as type of survey, economic benefit for different types of resource activities, and administrative needs. Each request for services is assigned a numerical value within CARS. These values produced by CARS, using the refined priority drivers, are being used in this reporting period to rank the cadastral service requests submitted for FY2005, FY2006 and FY2007. BIA and BLM Coordination Working as a team, BIA and BLM held a joint meeting in February 2004 to address issues associated with providing survey and GIS boundary services in Indian country. Issues discussed included: survey backlog, regional funding needs, CARS improvements, GCDB proposed projects, requests for emergency funds, timeline for survey services requested for FY2005, the new priority scoring sheet used by CARS for survey services requested and improving communication. As a result of the meeting, a timeline was established for submitting survey requests for FY2005, FY2006 and FY2007. The team also held a joint conference call each month of this reporting period. Training The latest LTIC class was held during this reporting period. There were 47 individuals enrolled in the class from BIA, BLM and tribal governments across the country. The enrollees were a mix of cadastral surveyors, realty specialists/officers, resource managers, legal counsel, selfgovernance specialists, leasing compliance officers/managers, accountants, paralegal specialists, natural resource specialists, public service directors, probate clerks, and agency superintendents. 10 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Cadastral Survey May 3, 2004 Two Advanced Cadastral Survey courses, designed primarily for surveyors, were taught during this reporting period. The approximately 60 surveyors attending these classes now should have a better knowledge of the process and procedures required for conducting official surveys in Indian country. The BLM Cadastral Indian Program Manager and Cadastral Survey Training Coordinator expect to continue to assist the OST curriculum committee and BIA in the development and implementation of future land tenure and boundary management trust training courses. Assistance in Interior Reengineering Efforts The draft cadastral elements of the “To-Be” reengineering efforts were presented to Interior managers at the joint BIA and BLM cadastral meeting and at the “To-Be” business model presentations during this reporting period. Current Status Interior Indian Trust Lands Boundary Standards (Draft) BIA, BLM and OST have scheduled a joint working group meeting for April 13-14, 2004, in Washington, DC, to examine land boundary standards and provide recommendations for changes and implementation. The standards address existing activities that are currently conducted under ad hoc and non-standardized procedures. GCDB Data Collection for High Priority Areas GCDB is a computerized graphic portrayal of the PLSS and is derived from a compilation of best available survey and title records. This representation of the boundaries is extremely useful in the management of trust assets. The BIA regional offices are expected to submit GCDB project proposals to BLM by April 9, 2004. Two pilot projects are expected to be selected. One of the pilot projects would be in an area where no GCDB information exists. The second pilot project would be in an area where the basic structure of GCDB information is already collected for the PLSS but a need exists for further collection of allotment parcel data. During the next reporting period, a proposal is expected to be prepared and presented to OST and BIA for consideration of approval and funding of the two pilot projects that are selected. Delays and Obstacles Disconnection from the Internet by Court Order and BLM Intranet Shutdown The March 15, 2004, Court-ordered disconnection from the Internet has adversely impacted the way communications are handled between BLM, BIA, OST and the public. Internal BLM communications also were impacted adversely as a result of its Internet and intranet connections. The Court order hampered the way CARS is being implemented by reducing effective 11 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Cadastral Survey May 3, 2004 communications among BIA, BLM and OST. The disconnection produced numerous delays and obstacles including:  External customers were not able to access the BLM cadastral website, estimated at 1,200 customers over the 4 day period.  Current surveyor and survey technician job vacancy announcements were not able to be viewed by potential applicants. A number of these positions are of great interest throughout Indian country.  Not having access to the web required information that normally is obtained instantly, and for free, to be purchased and delivered. This information includes private survey plats, deeds to create GCDB parcel level data on Indian reservations, assessor’s maps to verify fractionating parcels, geodetic control for GCDB computations, and GPS data.  GPS survey activities dependent upon data accessed via the Internet were greatly reduced and even nonexistent in some areas.  The writing, drafting, and review of survey plats and notes also were reduced or not performed, delaying the production of official surveys. GCDB Funding Proposal The funding proposal for the two GCDB pilot projects was not presented to OST and BIA during this reporting period. Delays associated with providing the data needed for proposed projects has caused the BIA regional offices’ submittal date to be pushed back to April 9, 2004. Limited Resources The cost to perform all requested cadastral services would be approximately 68 million dollars. The current budget of eight million dollars per year only addresses the most urgent needs. Furthermore, an estimated two to three million dollars in new cadastral requests are generated each year. Carefully allocating cadastral services for the highest priority surveys, developing CGIS, implementing the Interior Indian Trust Lands Boundary Standards, and incorporating the numerous recommendations in the “As-Is” report should help alleviate the projected backlog of high-priority cadastral service needs. Missing BIA Indian Service Survey Records and Unofficial Survey Records BLM cadastral surveyors often have been able to gather only portions of the records of unofficial surveys conducted by the BIA Indian Service surveyors from the 19th and 20th centuries, as well as unofficial surveys performed by other federal agencies or their agents. These unofficial surveys are known to exist in at least 12 states and on 42 reservations. Incomplete records can lead to errors in current official surveys and impair the bona fide rights of individual Indians, tribes and fee land owners. Evidence of unofficial surveys is discovered by BLM surveyors in the course of performing official surveys. Once the existence of on-the-ground unofficial surveys is identified, a search is made for the missing records. BIA is in the process of developing an inventory of its Indian Service records that relate to land surveys. 12 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Cadastral Survey May 3, 2004 Assurance Statement I concur with the content of the information contained in the Cadastral Survey section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 28, 2004 Name: Signature on File Donald A. Buhler Chief Cadastral Surveyor Bureau of Land Management 13 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Minerals Management Service May 3, 2004 C. MINERALS MANAGEMENT SERVICE Introduction Minerals Revenue Management (MRM), 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 Document Procedures Regarding Royalties Disbursement As previously reported, MMS is working with BIA and OST to prepare Memoranda of Understanding documenting inter-bureau procedures regarding information exchanges associated with mineral revenue disbursements. During this reporting period, MMS provided BIA and OST draft MOU containing proposed formats along with MMS-relevant mineral revenue disbursement procedures. MMS also requested that BIA and OST provide a point of contact to help expedite the review and execution of the MOU. Responses were due March 31, 2004. OST has responded, and BIA’s response is expected during the next reporting period. The target date for completing the MOU remains June 30, 2004. Indian Oil Rule As previously reported, the proposed rule for valuing crude oil produced from Indian leases is being considered. Issues associated with the proposed rule are under review by SOL. A timeline for implementation of the new rule has not been established. Payment Receipt Date Verification MRM recently determined that certain infrequent conditions cause its financial system to occasionally display an incorrect payment type, number and/or payment receipt date on the Indian mineral revenue distribution file that it creates and sends to BIA for use in the Indian mineral revenue distribution process. MRM and its contractor continue to research the cause of the incorrect information and expect to develop an action plan to address this issue based on the results of the research. Proposed software enhancements will be extensively tested prior to implementation. Implementation is scheduled for July 2004. As part of its action plan to address this issue, MRM should be able to identify the occurrences of the incorrect information. Once determined, the information will be provided to BIA and OST in order to make any necessary corrections to beneficiary accounts. Once the software change is implemented, MMS expects to provide a completion date for this project. 14 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Minerals Management Service May 3, 2004 Cathy J. Hamilton Chief of Staff Minerals Revenue Management Delays and Obstacles The March 15, 2004, Internet disconnection and subsequent reconnection required an extensive effort with substantial overtime in order to maintain reasonably timely payments to Indian beneficiaries. Any Internet disconnection for an extended period of time will cause substantial delays in payments to Indian account holders. Assurance Statement I concur with the content of the information contained in the Minerals Management Service section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 30, 2004 Name: Signature on File Minerals Management Service 15 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 D. OFFICE OF HISTORICAL TRUST ACCOUNTING Introduction 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 Third-Party Document Collection During this reporting period, OHTA requested from OST a list of entities that have trust-related contracts or other financial relationships with an individual Indian or a Tribe. As reported in the Status Report to the Court Number Sixteen, OHTA sent a similar request to BIA during the last reporting period. OHTA sent a second request during this reporting period to BIA. The purpose of these communications is to develop a list of potential holders of third–party records. Judgment IIM Accounts OHTA continues to perform historical accounting procedures on Judgment IIM accounts. As this work has progressed, the scope of the work reported has been expanded as summarized in the table below. See Status Report to the Court Number Fifteen for a more detailed description. OHTA completed the reconciliation of all the Subgroup A2 accounts last quarter, as previously reported. During this reporting period, OHTA’s effort focused on reconciling Judgment IIM accounts. To reconcile accounts identified in Subgroups B, C and D, OHTA obtained access to OST systems housing electronic check registers, which should allow accelerated disbursement testing. This work has enabled OHTA to achieve progress toward completing Judgment IIM account disbursement reconciliations. The results of reconciling the disbursements should be reflected by moving a substantial number of Subgroup B, C and D accounts from “Partially Reconciled” into the “Completely Reconciled” section in the next reporting period. 2 Subgroup A contains Judgment IIM accounts with a single receipt deposit and monthly interest postings through December 31, 2000, and no disbursement of funds. Subgroup B contains only Judgment IIM accounts with a single receipt deposit and monthly interest postings with a single disbursement. Subgroup C contains only Judgment IIM accounts with a single receipt deposit and monthly interest postings with multiple disbursements. Subgroup D contains accounts with both (1) Judgment transactions with the single receipt deposit and monthly interest postings, and (2) land-based transactions (income from land interests owned by the account holder). 16 -- $50,488,975 4,332 $7,954,390 $4,867,294 4,338 $7,954,390 $4,877,505 $28,789,940 -- -- STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 Status of Work Judgment IIM Accounts Open as of 12/31/00 -- Number of Accounts: 33,205 Balances Total: $80,839,699 Throughput Total: $140,694,346 Subgroup A Subgroup B Subgroup C Subgroup D Totals Completely Reconciled Number of Accounts 17,685 -- -- 17,685 -- $50,488,975 -- $ Balances Reconciled 4 -- $6,796 0 -- -- 2 -- $3,415 $17,682 $11,347 $28,760,911 11,182 $22,396,334 $ Throughput Reconciled $50,749,367 -- -- -- $50,749,367 Partially Reconciled Number of Accounts $ Balances Reconciled $ Throughput Reconciled* $ Throughput to be Reconciled** Paper Era Reconstruction Number of Accounts*** $ Balances To Be Reconciled* $ Throughput to be Reconciled** $56,277,534 Judgment IIM Accounts Open as of or after 10/25/94 but closed prior to 12/31/00 NA NA -- -- -- Number of Accounts: 47,334 Balances Total: $0 Throughput Total: $499,956,704 Subgroup A Subgroup B Subgroup C Subgroup D Totals Completely Reconciled Number of Accounts 2,697 2,697 $ Balances Reconciled -- -- $ Throughput Reconciled NA $14,795,420 -- $14,795,420 17 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 9,936 -- $12,875,433 -- 27,111,291 9,422 -- 11,239,682 1,138 -- 2,996,176 24,141 -- Partially Reconciled Number of Accounts NA 20,496 $ Balances Reconciled NA $ Throughput Reconciled* NA $ Throughput To Be Reconciled** -- $39,620,285 $8,031,429 $107,523,588 $155,175,302 Paper Era Reconstruction Number of Accounts*** $ Balances Reconciled $ Throughput to be Reconciled $302,874,691 * Reconciled throughput, where throughput is defined as the sum of the receipts and disbursements in the electronic era portion of an account. ** Throughput relating to respective accounts to be reconciled. *** Distribution of reconstructed paper era accounts unknown. OHTA has completed some Judgment IIM disbursement work. This work required that Treasury develop a report of checks issued and negotiated from March 1987 (earliest date Treasury information is available) through December 31, 2002, and electronic funds transfers completed from October 1997 (earliest date Treasury information is available) through December 31, 2002. This work was completed during this reporting period. OHTA expects that the foregoing disbursement reconciliation work will be submitted for quality control review when completely reconciled accounts within Subgroups B and C, and judgment-related transactions in Subgroup D, are delivered. The majority of the remaining Judgment IIM accounts (as well as some Per Capita IIM accounts) require conversion of transaction data recorded in manual ledgers into electronic format. OHTA has searched approximately 1,500 boxes of stored records for manual ledgers required to complete the account history for Judgment and Per Capita IIM accounts that originated in the “Paper Records Era.” Approximately 41,000 transactions for 6,200 accounts have been located and entered into electronic format as a result of this effort. Per Capita IIM Accounts OHTA continues to perform historical accounting procedures on Per Capita IIM accounts. As this work has progressed, the scope of the work reported has been expanded as summarized in the table below. See Status Report to the Court Number Fifteen for a more detailed description. 18 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 OHTA completed the reconciliation of all the Subgroup A3 accounts last quarter, as previously reported. During this reporting period, OHTA’s effort focused on reconciling Per Capita IIM accounts. To reconcile accounts identified in Subgroups B, C and D, OHTA obtained access to OST systems housing electronic check registers, which should allow accelerated disbursement testing. This work has enabled OHTA to achieve progress on completing Per Capita IIM account disbursement reconciliations. The results of reconciling the disbursements should be reflected by moving a substantial number of Subgroup B, C and D accounts from the “Partially Reconciled” into the “Completely Reconciled” column in the next reporting period. 5,199 $42,037,401 $26,875,178 493 $5,902,269 $5,734,522 6,436 $56,821,414 $42,542,144 $40,630,741 744 $8,881,744 $9,932,444 $4,181,422 -- -- -- -- Status of Work Per Capita IIM Accounts Open as of 12/31/00 Number of Accounts: 9,013 Balances Total: $ 69,486,684 Throughput Total: $ 98,208,350 Subgroup A Subgroup B Subgroup C Subgroup D Totals Completely Reconciled Number of Accounts 1,146 -- -- -- 1,146 $ Balances Reconciled $9,288,374 -- -- -- $9,288,374 $ Throughput Reconciled $10,686,311 -- -- -- $10,686,311 Partially Reconciled Number of Accounts $ Balances Reconciled $ Throughput Reconciled* $ Throughput To Be Reconciled** $1,884,446 $34,564,873 3 Subgroup A contains Per Capita IIM accounts with a single receipt deposit and monthly interest postings through December 31, 2000, and no disbursement of funds. Subgroup B contains only Per Capita IIM accounts with a single receipt deposit and monthly interest postings with a single disbursement. Subgroup C contains only Per Capita IIM accounts with a single receipt deposit and monthly interest postings with multiple disbursements. Subgroup D contains accounts with both (1) Per Capita transactions with the single receipt deposit and monthly interest postings, and (2) land-based transactions (income from land interests owned by the account holder). 19 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 1,431 $3,376,896 Paper Era Reconstruction Number of Accounts*** $ Balances To Be Reconciled $ Throughput To Be Reconciled 0 81 264 -- 183 -- NA NA 3,924 748 2,922 NA NA NA $30,251,061 $15,817,206 $4,657,616 $9,776,239 2,162 -- $4,349,154 Per Capita IIM Accounts Open as of or after 10/25/94 but closed prior to 12/31/00 Number of Accounts: 10,020 Balances Total: $0 Throughput Total: $93,733,222 Subgroup A Subgroup B Subgroup C Subgroup D Totals Completely Reconciled Number of Accounts $ Balances Reconciled -- -- $ Throughput Reconciled NA $2,483,917 $1,161,877 -- $3,645,794 Partially Reconciled Number of Accounts 7,594 $ Balances Reconciled -- -- -- -- $ Throughput Reconciled* $ Throughput To Be Reconciled** NA $19,442,921 $6,876,582 $32,156,049 $58,475,552 Paper Era Reconstruction Number of Accounts*** $ Balances Reconciled $ Throughput to be Reconciled $1,360,815 * Reconciled throughput, where throughput is defined as the sum of the receipts and disbursements in the electronic era portion of an account. ** Throughput relating to respective accounts to be reconciled. *** Distribution of reconstructed paper era accounts unknown. 20 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 OHTA has completed some Per Capita IIM disbursement work. This work required that Treasury develop a report of checks issued and negotiated from March 1987 (earliest date Treasury information is available) through December 31, 2002, and electronic funds transfers completed from October 1997 (earliest date Treasury information is available) through December 31, 2002. OHTA expects that the foregoing disbursement reconciliation work will be submitted for quality control review when completely reconciled accounts within Subgroups B and C, and judgment-related transactions in Subgroup D, are delivered. Results of quality control reviews will be reported in future reporting periods. Land-based IIM Accounts Although OHTA continues to perform limited land-based historical accounting, the scope of the work reported has been expanded as summarized in the table below. See Status Report to the Court Number Fifteen for a more detailed description. Summary of Scope Expansion of Land-based IIM Accounts Total Balances Total Throughput $3,334,595,339 $198,000,000 2,586,740,445 -- Number of Accounts 193,766 46,341 December 31, 2000 open accounts, as reported in July 2, 2002 Report to Congress Accounts open as of or after October 25, 1994 (enactment of the 1994 Act), and closed prior to December 31, 2000 240,107 $198,000,000 $5,921,335,784 Expanded Account Data Totals OHTA has completed the land-based IIM account reconciliations for the 37 accounts of the five named plaintiffs and their predecessors-in-interest. An aggregate of 48 receipt errors were found with a value totaling $3,181.00 (ranging from $1.01 to $500.08) resulting in overpayments to the IIM account holders plus three disbursement errors totaling $36.00 (ranging from $5.00 to $21.47) also resulting in insufficient deductions against the IIM account holders. The accounting also identified a single receipt transaction of $60.94 that was incorrectly credited to another IIM account. During this reporting period, OHTA began collecting necessary documentation to reconcile all transactions exceeding $100,000 in the electronic era. OHTA is in the process of reconciling those transactions for which the documentation was located. In addition, OHTA drew a random sample of land-based IIM accounts and is in the process of collecting needed documents to reconcile randomly drawn transactions from this sample. OHTA finalized a report during this reporting period for the historical accounting project for 289 Eastern Region land-based IIM transactions valued at $126,362. The report stated that the reconciled transactions were performed in accordance with requirements of OHTA’s Accounting Standards Manual. OHTA expects to finalize a quality control review of the final report during 21 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004 the next reporting period. Further, work is being done to reconcile transactions from Alaska Region land-based IIM accounts. Special Deposit Accounts Clean-Up Project The SDA Clean-Up Project continues to identify the proper ownership of residual funds in SDA. The objective is to identify or transfer funds held in SDA and distribute monies to proper IIM accounts, tribal accounts, or non-trust owners. The results of the SDA Clean-Up Project for the three-month period ending March 31, 2004, are provided in the following table. SDA Resolution Progress Dollars Number of Accounts $67,900,000 (12,407,265) SDA as of 12/31/00 SDA resolved from January 1, 2001, through December 31, 2002 SDA as of January 1, 2003 21,415 (3,687) 17,728 55,492,735 Interest posted on undistributed SDA and additional collections (net of disbursements thereof) credited to SDA from January 1 through December 31, 2003 -- 4,942,530 13,968 SDA resolved from January 1 through December 31, 2003 (3,537) (17,263,863) SDA that remain to be resolved as of December 31, 2003 - Reported in the Status Report to the Court Number Sixteen 14,191 43,171,402 Interest posted on undisbursed SDA and additional collections (net of disbursements thereof) credited to SDA during the reporting period ending March 31, 2004 -- 1,035,479 SDA resolved from January 1, 2004, through March 31, 2004 (223) (3,869,615) SDA remaining to be resolved as of March 31, 2004 $40,337,266 OHTA continues to coordinate its SDA work with BIA. During this reporting period, OHTA prepared SDA materials to clean up SDA at 24 agency, regional and tribal offices. For the reporting period ending December 31, 2003, OHTA prepared 380 Recommended Action Forms (RAF) associated with 118 OHTA SDA that addressed ownership of SDA residual funds. The disposition of these 380 RAF follows. 22 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Office of Historical Trust Accounting May 3, 2004  192 RAF are included in the above SDA resolved from January 1, 2004, through March 31, 2004, and resulted in distributions of $17,336 to IIM account holders, tribal accounts and non-trust owners, and transfers of $108,501 to the appropriate IIM account(s).  188 RAF are not included in the SDA resolved from January 1, 2004, through March 31, 2004, and either require an SOL opinion, or await BIA or OST approval, prior to final resolution. During this reporting period, OHTA distributed 202 copies of the OHTA SDA Cleanup Procedures Guide to provide uniform guidance on the SDA Clean-Up Project for OHTA, BIA, OST and contractor staff. Imaging/Coding – Indian Trust Documents OHTA’s imaging and coding efforts continued during this reporting period. As of the end of this reporting period, OHTA had completed the following imaging and coding work. Imaging and Coding Progress Documents Loaded into Accounting Reconciliation Tool Documents Coded Pages Scanned Work results from July 9, 2003, to December 31, 2003 Work results from January 1, 2004, to March 31, 2004 25,203 101,826 127,029 97,515 48,928 146,443 Cumulative results from July 9, 2003, to March 31, 2004 1,550,108 2,063,339 3,613,447 Delays and Obstacles On March 15, 2004, the Court issued a preliminary injunction to disconnect Interior’s computer systems from the Internet. On March 24, 2004, the D.C. Circuit Court of Appeals issued a stay of the preliminary injunction. This restriction on Internet access adversely impacted OHTA’s historical accounting work by removing electronic connectivity with its contractors and causing delays in obtaining critical information from Interior bureaus and offices. OHTA is working to eliminate backlogs caused by this delay. 23 STATUS REPORT TO THE COURT NUMBER SEVENTEEN May 3, 2004 Assurance Statement 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 Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: May 3, 2004 Name: 24 Office of Historical Trust Accounting Signature on File Bert T. Edwards, Executive Director Office of the Historical Trust Accounting STATUS REPORT TO THE COURT NUMBER SEVENTEEN May 3, 2004 Office of the Special Trustee for American Indians III. OFFICE OF THE SPECIAL TRUSTEE FOR AMERICAN INDIANS Introduction 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 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 the role of the Special Trustee set forth in the Act, the Secretary assigned other duties to the Special Trustee, including accounting and investing of collected funds, developing a risk management program, managing a reengineering effort of the trust business processes and creating an audit and review function to grade the performance of various Interior bureaus and offices and Tribes that perform fiduciary trust functions. Special Trustee’s Observations Accomplishments and Completions The following are highlights of some of the activities accomplished during this reporting period. Reengineering (“To-Be”) The draft model comment period ended on March 31, 2004. The due date for a final model is May 31, 2004. The implementation plan is expected to be developed by June 30, 2004. Private sector comments on the draft model were received during this reporting period and are expected to be considered with other comments received through March 31, 2004. Trust Review and Audit Field testing of the trust examination procedures and processes began during this reporting period. An examination of compacted fiduciary trust management processes of the Cherokee Nation in Oklahoma was performed during this reporting period. Results of that examination are expected to lead to the development of a corrective action plan to be agreed upon with the Cherokee Nation. During the next reporting period, examinations of fiduciary trust activities performed at BIA agencies are expected to begin and may extend to additional Tribes having trust management responsibilities. Information Technology The CGI title system version 1.49 was approved as a replacement for the BIA legacy Land Records Information System during this reporting period. Action to install and convert legacy title systems now is underway and is expected to be completed by the end of the first quarter of 25 STATUS REPORT TO THE COURT NUMBER SEVENTEEN May 3, 2004 Office of the Special Trustee for American Indians CY2005. In addition, efforts are underway to develop a realty/leasing system that is compatible with the TFAS system as an interim replacement for existing, multiple legacy systems. Advisory Board The first meeting of the new Special Trustee Advisory Board was held during this reporting period. At this meeting, project managers briefed the Board on their respective activities. Additional meetings are scheduled quarterly. Comprehensive Trust Management Plan As CTM was completed in March 2003, plan activities now are the responsibility of each manager. The TRAC system is now in use to track the actions necessary to implement CTM. It is expected that CTM will continue to evolve and change as the final “To-Be” Model is developed and as trust reform efforts continue. Further developments regarding CTM will be reported in the Special Trustee’s observations in each Status Report to the Court, rather than in a separate section of the report. Current Status Reorganization A major initiative to perform Interior’s fiduciary trust role is to employ trust officers at BIA agencies. Although solicitations were announced during this reporting period, there was not sufficient response from qualified people with trust experience to fill the positions. A new effort was made during this reporting period to expand the solicitation to include direct mailings to banks, trust companies and other trust-related organizations in an attempt to recruit from a broader audience. The managers are confident that qualified people can be recruited for these positions. The sixth trust administrator position is being advertised and is expected to be filled during the next reporting period. Proposals for investment management of IIM funds were received during this reporting period. Selection of an investment firm now is expected during the next reporting period. Legislation Work continued with the Senate Committee on Indian Affairs on proposed legislation, S. 1721, which contains proposed amendments to ILCA and a uniform Indian probate code. Extensive work has been done on this legislative initiative by various Indian groups as well as Interior. It is expected that this proposed legislation will be marked up and voted on before Congress adjourns this fall. 26 STATUS REPORT TO THE COURT NUMBER SEVENTEEN May 3, 2004 Office of the Special Trustee for American Indians Delays and Obstacles Obstacles to trust reform include lack of access to the Internet by Interior trust managers and staff, required handling of very small IIM accounts, and obtaining cooperation from Tribes for the reorganization and reengineering effort. Several Great Plains Tribes have signed a resolution that advises Interior not to place trust officers or deputy superintendents on their reservations at BIA locations. No action has been taken regarding the resolution, but attempts are expected to be made during the next reporting period for consultation with the affected Tribes to resolve the issue. The reengineering of trust business processes also may become more of an obstacle as the reengineered processes begin to be introduced into day-to-day activities of Interior’s bureaus and offices. The reengineered business processes are expected to result in major changes in the way Interior does business, and, as a result, will require full cooperation throughout Interior if the changes are to be implemented. However, it also is expected that the changes can create substantial productivity improvements in the way Interior delivers services and meets the needs of the Tribes and individual Indian beneficiaries. Assurance Statement The comments and observations are provided by the Special Trustee for American Indians and reflect the opinion of the Special Trustee only. Date: April 30, 2004 Name: Signature on File Ross O. Swimmer Special Trustee for American Indians 27 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Review and Audit May 3, 2004 A. TRUST REVIEW AND AUDIT Introduction The Office of Trust Review and Audit reports directly to the Special Trustee. The Office was created by OST as a response to trust initiatives developed during the tribal consultation process of 2002. OTRA conducts performance audits of Interior entities as well as Tribes that manage fiduciary trust activities. These reviews are planned to result in a performance rating. OTRA also conducts audits and reviews that may be requested by individual account holders, Tribes, the Special Trustee and Interior staff. Priorities for review are determined by the locations with the greatest volume of trust activities. Accomplishments and Completions Annual Interior Indian Trust Funds Financial Statement Audit The Indian trust funds financial statement audit is required by the American Indian Trust Fund Management Reform Act of 1994, and is conducted by an independent third party under OIG management. The FY2003 audit report was issued by OIG during the last reporting period. The notice to account holders advising them that the audit has been completed and is available for their review was not distributed during this reporting period as planned. However, it is expected to be distributed with account statements during the next reporting period. Current Status Compliance Reviews Compliance reviews result from inquiries by beneficiaries or other interested groups and usually question the adequacy or status of trust and fiduciary activities of Interior. OTRA assigns the inquiries to internal audit staff to investigate and, when needed, recommends appropriate corrective actions. OIG determined that a reimbursable cooperative agreement for investigation assistance between OIG and OST (as discussed in the previous report) was not necessary because of their current statutory and budget authority. Alternatively, OIG committed to provide investigation assistance for these reviews, as is provided to other Interior bureaus and offices. During this reporting period, 22 cases were in inventory. For the 22 in inventory, field work is underway on four and draft reports are being prepared and reviewed on nine. Seven cases were completed with reports and two cases were cancelled after determining the allegations were unfounded. Examinations of Self-Governance Demonstration Tribes The FY2004 appropriations act exempted ten self-governance Tribes (three individual Tribes and a consortium of seven Tribes) from the impacts of trust reform and reorganization. However, their exemption is conditioned upon their operating trust programs in accordance with the same fiduciary standards to which the Secretary is held and satisfying the Secretary that they have the 28 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Review and Audit May 3, 2004 capability to do so. OTRA continued its reviews of these groups this reporting period and drafted reports discussing the extent to which these Tribes are meeting the fiduciary standards. The purpose of these reviews is not to disqualify any Tribe from contracting or compacting, but rather to assist the Tribes in understanding and meeting their fiduciary trust obligations. Four draft reports were issued this reporting period and comments from the Tribes are due early next reporting period. Final reports are expected to be completed by the end of the next reporting period. Annual Audit Corrective Actions OST developed corrective action plans for its outstanding audit findings and recommendations. Monthly progress reports on implementation of actions to resolve material weaknesses are being provided to senior Interior officials. Several of the corrective actions necessary to resolve portions of one material weakness were completed by OST this reporting period. Indian Trust Rating System Development of the rating system continues with the assistance of a senior examiner from the Office of the Comptroller of the Currency. The purpose of the rating system will be to measure performance of fiduciary trust activities accomplished in whole or part by the respective Interior offices or the Indian Tribes that have compacted or contracted various activities. Currently, OTRA is testing the process for examining operations to review management systems with the objective of determining the level of due diligence in the administration of the trust programs in order to develop a fair performance rating system. The examination process and procedures to evaluate trust performance are being developed for review by the Special Trustee prior to a presentation to the Indian Tribes and Nations at their May 2004 Self-Governance Conference. The Director of Trust Review and Audit plans to report on the revised evaluation process at this conference. One pilot test of the new examination process was conducted this period in cooperation with the Cherokee Nation, a large selfgovernance Tribe, and another pilot test is scheduled at the BIA Concho Agency next reporting period. The examination process and procedures will stay in draft development while field testing and discussion with Interior entities and consultation with Indian leadership continues. 29 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Review and Audit May 3, 2004 Assurance Statement I concur with the content of the information contained in the Trust Review and Audit section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 29, 2004 Name: Signature on File William P. Ragsdale Director, Office of Trust Review and Audit Office of the Special Trustee for American Indians 30 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Records Management May 3, 2004 OFFICE OF THE CHIEF INFORMATION OFFICER B. 1. RECORDS MANAGEMENT Introduction 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 record 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. Accomplishments and Completions Records Retention Schedules NARA approved the following electronic records retention schedules during this reporting period: IRMS Lease/Lease Distribute/Range/Owner Module; IRMS – Individual Indian Monies; IRMS People/Per Capita Modules; Royalty Distribution and Reporting System; Osage Annuity System; Land Records Information System. 1. 2. 3. 4. 5. 6. American Indian Records Repository (AIRR) The archival quality records storage facility was completed during this reporting period. Approximately 20,000 boxes of indexed records have been relocated from the Lee’s Summit Federal Records Center and OTR Albuquerque to AIRR. Records Management Liaisons OTR conducted training for three records management liaisons during this reporting period. All records management liaisons now have been trained and are providing records management technical assistance to BIA and OST field personnel. In the next reporting period, OTR expects to advertise a records management specialist position to support the Central Office programs on records management. 31 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Records Management May 3, 2004 Development of Policies and Procedures OTR distributed to BIA and OST the last three chapters of its Indian Affairs Records Management Manual. The manual contains the policies and procedures that OTR expects to use to provide records management guidance and assistance. Training OTR provided records management training for 277 BIA/OST identified records contacts and provided records management orientation for 192 BIA line officers during this reporting period. Current Status Record Keeping Requirements The following bureaus have notified OTR that records have been assessed and no record series have been identified as containing Indian fiduciary trust records: the National Park Service, U.S. Geological Survey, and the Fish and Wildlife Service. The following bureaus and offices have notified OTR that records have been assessed and steps taken to prevent destruction of the trust records: Office of Surface Mining, Bureau of Land Management, Bureau of Reclamation and Minerals Management Service. The National Business Center is working with offices under the Office of the Secretary to assess and identify record series at this time. In the Status Report to the Court Number Sixteen, OTR reported that a meeting with the tribal/federal records management work group was anticipated. The meeting did not take place during the reporting period. During this reporting period, OTR received a letter from a union representing certain OTR employees. The union questioned a proposed records move to Kansas and accused OTR of improper record keeping procedures. Through a reply letter to the union, OTR’s Director responded to the union’s allegations. Records Retention Schedules In the next reporting period, OTR expects to begin working with BIA and OST to implement the NARA-approved 4000 records series of 16 BIAM and the electronic records schedules, which will then become part of the IAM for the BIA. Records Retrieval/Indexing Project OTR’s contractor continued indexing boxes of Indian records in Albuquerque, NM and Kansas City, MO. The total number of boxes indexed through March 31, 2004, is approximately 54,000. As previously reported, the index is designed to serve as a finding aid to research boxes of records. It provides a box and file level index of all boxes; that is, within each box, the title on each folder is captured along with the date range, and region or agency that created the records. In the case of financial records, a document type also is captured. The indexing project does not 32 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Records Management May 3, 2004 include the imaging of individual documents. Priority for the indexing of boxes of Indian records continues to be those boxes of records potentially responsive to tribal trust litigation, and now also includes boxes required by OHTA to meet the requirements of OHTA litigation support projects. In support of the historical accounting effort, Interior utilized available OTR and OHTA staff and contractor resources to search for selected records during the reporting period. As a result, OTR estimates a two-month delay in the completion of the indexing of the initial phase of 76,000 boxes. It was estimated that Phase I would be completed during the second quarter of CY2004. It now is estimated that Phase I will be completed during the third quarter of CY2004. Delays and Obstacles Lack of Internet access continues to hinder OTR’s ability to provide access to the record index database by client agencies and authorized users of the records. If Internet access were available, authorized researchers could conduct their searches remotely from their respective work sites and only visit OTR when necessary to inspect specific boxes. Use of the limited space in OTR facilities intensified and continued to affect OTR’s daily work activities as OTR staff attempted to respond to requests for access to records from federal attorneys, plaintiffs’ tribal trust litigation attorneys and their contractors, and federal agencies and their contractors. Assurance Statement I concur with the content of the information contained in the Records Management section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: May 3, 2004 Name: Signature on File Ethel J. Abeita Director, Office of Trust Records Office of the Special Trustee for American Indians 33 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Business Process Modeling May 3, 2004 C. TRUST ACCOUNTABILITY 1. TRUST BUSINESS PROCESS MODELING Introduction 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 development of the “To-Be” Model during the redesign referred to as the “To-Be” reengineering effort. The “To-Be” Model is structured around the following major trust business processes:  Financial Operations – To assure the timely identification, collection, deposit, investment and distribution of income due or held on behalf of tribal and individual beneficiary account holders.  Beneficiary Relationship Development and Management – To provide beneficiaries with accurate and timely trust asset information and counseling on asset management and use options. This is accomplished by incorporating the Secretary’s Trust Principles and the concepts outlined in the CTM into the process.  Ownership – To ensure the inventory of trust or restricted ownership interests is current, accurate and accessible. This process ensures the identification of all beneficiary ownership interests for accurate and timely distribution of income, as well as distribution of trust assets to current and future beneficiaries.  Land and Natural Resources Planning – To provide beneficiaries with support necessary to develop wide-area plans that enhance and expedite the management and utilization of trust land and natural resources.  Land and Natural Resources Use and Management – To ensure lands are productive and managed in accordance with accepted conservation and preservation practices. Land use is monitored for compliance with and enforcement of established agreements to protect trust assets. When implemented, the “To-Be” Model should 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. Accomplishments and Completions During this reporting period, TPMC continued the reengineering activity required to refine the draft “To-Be” Model. To acquire input from stakeholders, TPMC conducted the fifth and final “To-Be” informational meeting in Rapid City, SD. As with the previous meetings, stakeholders had an opportunity to review and comment on the draft “To-Be” Model. Informational presentations of the “To-Be” Model also were made to the MMS Quality Steering Committee 34 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Business Process Modeling May 3, 2004 and the BIA Office of Trust Services. In response to tribal requests, the due date for submitting comments and recommendations was extended to March 31, 2004. Accordingly, the final “To- Be” Model due date has been extended to May 31, 2004, with the final implementation plan due June 30, 2004. During this reporting period, TPMC mailed a copy of the CD containing the draft “To-Be” Model to each Tribe. The draft “To-Be” Model also was made available on Interior’s website at www.ost.doi.gov. TPMC expanded the “To-Be” Gap Analysis, which identifies the implementation requirements for transitioning from the “As-Is” state to the “To-Be” state. This portion of the “To-Be” Gap Analysis defines implementation steps to close the gaps and identifies the dependencies between business processes and the Universal Support Functions that will be required for implementation. Once the “To-Be” Gap Analysis is finalized, it will play a critical role in the implementation plan for the “To-Be” Model. Private sector review of the draft “To-Be” Model was completed during this reporting period. The comparative analysis, provided by two separate banking institutions, identified the operational and fiduciary differences between the “To-Be” Model and private sector trust business processes. The information contained in the analysis will be taken into consideration during the continuous process of refining the “To-Be” Model. TPMC completed a Change Management Plan that addresses the human aspects of change, both prior to and throughout implementation of the “To-Be” Model. The plan identifies change management strategies and initiatives as well as target audiences. Implementation of the Change Management Plan is expected to create an environment that is receptive to the transition that will occur when the “To-Be” Model is implemented. Current Status Using the comments and recommendations received to date, TPMC continues to refine the draft “To-Be” Model for each of the five business processes. The refinement process includes updating the business process flow diagrams and informational templates as required. In addition, TPMC completed the process of linking the business process flow diagrams with interprocess dependencies. The refinement process will continue until the final “To-Be” Model is produced. TPMC has drafted an implementation strategy which will serve as the foundation for the detailed implementation plan. The implementation strategy focuses on implementing in phases and conducting pilot projects so that roll-out of the “To-Be” Model achieves the highest probability of success. To ensure that implementation of the “To-Be” Model is integrated with other trust initiatives for the 21st century and their respective schedules, TPMC is monitoring and keeping abreast of other trust reform activities. As other initiatives are being implemented and new systems are being 35 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Business Process Modeling May 3, 2004 developed, TPMC plans to ensure that the “To-Be” Model is consistent with any new procedures and schedules. Delays and Obstacles Major obstacles affecting the ability of Interior to build a trust services delivery model include:  lack of Internet access;  sheer complexity of reengineering the existing trust business processes to achieve integrated and consistent business processes. Assurance Statement I concur with the content of the information contained in the Trust Business Process Modeling section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 30, 2004 Name: Signature on File D. Jeff Lords Acting Deputy Special Trustee Trust Accountability 36 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Data Quality and Integrity May 3, 2004 2. TRUST DATA QUALITY AND INTEGRITY Introduction 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 tasks of the trust data quality and integrity project are to validate/correct a set of standardized trust data elements, implement quality controls that will ensure trust data is accurate, current, and secure and provide trust transaction and real property asset statements to beneficiaries. The DQ&I pilot agency project focuses on accomplishing two initiatives: (1) implementing Post-QA processes at the BIA Anadarko Agency, Concho Agency and their servicing SPROLTRO, and (2) validating/correcting current CDE to their respective source documents. CDE are defined as those trust data elements that are needed to provide: (1) timely and accurate payments to beneficiaries, (2) timely and accurate transaction listings and asset inventories to beneficiaries, and (3) effective management of the assets. Examples of CDE are beneficiary name, account number, tract identification number, and land ownership interests. The implementation of the Post-QA processes has been accomplished. The current CDE are in the process of being validated/corrected, on a tract-by-tract basis, to their source input documents. Once CDE validation/correction is completed for these locations, the Post-QA process is expected to remain to help ensure that CDE updates are accurate. Accomplishments and Completions During this reporting period, the following were completed by TPMC:  Compiled and provided weekly Post-QA review information to the Anadarko Agency, Concho Agency, and SPRO management. This information showed the number of documents that: (1) went through Post-QA review; (2) went through Post-QA review that were encoded accurately into the respective land title and realty systems; and (3) were returned to the originating office due to discrepancies between the document encoding and source document.  Implemented Post-QA review processes for IRMS encoding at the Pima Agency.  Developed, in coordination with BIA, a streamlined process for accessing BIA trust systems. This process is intended to minimize the time it takes for the contractor to receive logon IDs and secure the set-up of security profiles for access to the BIA trust systems.  Initiated CDE validation/correction on Anadarko Agency tracts.  Encoded in IRMS 111 Pima Agency probate orders, which resulted in the agency being able to distribute funds held in special deposit accounts. 37 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Data Quality and Integrity May 3, 2004  Compiled a list of Anadarko Agency and Concho Agency encumbrances in support of the OST lock box implementation initiative. In addition, as reported by OST’s contractors, during this reporting period the following assigned tasks, which eliminated backlogs, were completed:  Encoded remaining balance of 1,792 Eastern Navajo Agency encumbrances in LRIS.  Organized remaining balance of 147 Concho Agency homesite and business lease files. Current Status During this reporting period, besides the contractor's DQ&I pilot project tasks, the contractor also continued to support:  Verification of land owner ID numbers for Concho Agency probate orders prior to their encoding in the land title system.  Encoding Pine Ridge Agency probate orders that reverse escheated interests in the land title system.  Encoding Alaska Region land title documents (i.e., trust patents, conveyances, encumbrance documents, etc.) in the land title system. Data Quality and Integrity Pilot Agency Project During the reporting period, the DQ&I pilot agency project was expanded to the Pima Agency and the Palm Springs Field Office. Due to the start-up of ILCP and the GPRO’s conversion from LRIS to the CGI title system, the implementation of the DQ&I pilot agency project for the Pine Ridge Agency was deferred until October 31, 2004. Implementation of the DQ&I pilot agency project for the Eastern Navajo Agency was impeded due to the unavailability of office space at that agency and the moving of the SWRO-LTRO (the servicing LTRO). In addition, the project implementation schedule was modified, so that when feasible, the DQ&I pilot agency project would be implemented throughout a BIA region, rather than at specific agencies within a region, in order to minimize the disruption to BIA operations. Subsequently, for the remainder of FY2004, the DQ&I pilot agency project is scheduled to be implemented at the three remaining locations (Pawnee Agency, Horton Agency and the Shawnee Field Office) within the jurisdiction of the SPRO and at all four locations (Palm Springs Field Office, Southern California Agency, Central California Agency and Northern California Agency) within the jurisdiction of the PRO. 38 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Data Quality and Integrity May 3, 2004 Delays and Obstacles Securing timely access to the BIA trust systems continues to be the primary delay/obstacle to the DQ&I pilot agency project. Although OST and BIA developed a streamlined process for securing access to the BIA trust systems, it has not been satisfactorily implemented. 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 pilot agency project being unable to take full advantage of available information technology. Assurance Statement I concur with the content of the information contained in this Trust Data Quality and Integrity section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 28, 2004 Name: Signature on File John E. White Trust Reform Officer Office of the Special Trustee for American Indians 39 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Indian Fiduciary Trust Training Program May 3, 2004 3. INDIAN FIDUCIARY TRUST TRAINING PROGRAM Introduction 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 OST offered two sessions of the course, Fiduciary Overview Program, presented by Cannon Financial Institute, with 63 BIA, OST, MMS and tribal personnel attending during this reporting period. A total of 373 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. Three sessions are scheduled to be held during the next reporting period. During this reporting period, OST training staff conducted twelve sessions to provide training in TFAS, Stratavision and Historical Query to 127 OST, BIA and contractor staff. Current Status As previously reported, OST has contracted for the development of a CD version of the Fiduciary Trust Foundations: An Introduction to Trust Reform and Change course. The CD version is expected to provide trust personnel with a basic understanding of the federal government’s fiduciary responsibilities. SOL reviewed the draft, provided comments and is working with OST training staff to incorporate the changes during the next reporting period. An inventory of training that was offered during the last three years to OST and BIA employees was received from the contractor. This inventory is intended to identify training deficiencies and identify existing courses. OST training staff did not present the findings to senior management this reporting period due to scheduling conflicts but expects to present it during the next reporting period. The draft Manager’s Handbook for New Hires was completed and is being circulated for comment. This handbook is intended to be a guide for managers to introduce new employees to the office and help managers cover issues such as internal controls and expectations of the employee. It also will include the Fiduciary Trust Foundations CD. The final version of the handbook is expected to be completed during the next reporting period. OST and BIA training staff are working to develop a comprehensive orientation program tailored to meet the needs of employees in trust-related positions. The program currently being developed is a three-day course that includes such topics as the history and policy of Indian trust, trust reform, current reform activities, job roles and responsibilities, organization and working relationships. OST training staff did not present the pilot class to senior management this 40 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Indian Fiduciary Trust Training Program May 3, 2004 reporting period due to scheduling conflicts but is expected to present it during the next reporting period. This course is expected to be taught three to four times a year by regional BIA/OST employees. OST staff began work on the training strategy for the five “To-Be” Business Processes, with the first being the Beneficiary Relationship Development Management process. The draft training strategy and curriculum development plan is expected to be completed during the next reporting period. Delays and Obstacles The lack of Internet access inhibits electronic communication with other governmental agencies and contractors, and hinders the research of training tools and potential contractors. Assurance Statement 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 Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 27, 2004 Name: Signature on File Dianne M. Moran Director, Trust Training Office of the Special Trustee for American Indians 41 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Risk Management May 3, 2004 4. 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. Once the risk management program has been implemented by TPMC, OTRA will monitor and evaluate it, and recommend resolutions of any management control deficiencies. Accomplishments and Completions OST has completed the training phase of the comprehensive risk management program and the Risk Management Assessment/Evaluation tool (RM-PLUS) at the twelve BIA regions. During this reporting period, the web-based version of RM-PLUS (version 1.2) was certified and accredited for BIA use. Current Status During this reporting period, the development contract for RM-PLUS ended. OST is working on obtaining a new contract for implementation of RM-PLUS. OST expects to have a new contract in the next reporting period. Once a new contract is awarded, OST expects to:  Field test RM-PLUS at six BIA pilot sites prior to implementing the application nationwide.  Initiate the risk management process with OST agency-wide.  Continue working on the risk management process for Indian trust-related programs within BLM. Delays and Obstacles The lack of Internet access complicated the development of RM-PLUS since it is a web-based application. 42 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Risk Management May 3, 2004 Assurance Statement I concur with the content of the information contained in the Risk Management section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 30, 2004 Name: Signature on File D. Jeff Lords Acting Deputy Special Trustee, Trust Accountability Office of the Special Trustee for American Indians 43 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Regulations, Policies and Procedures May 3, 2004 5. REGULATIONS, POLICIES AND PROCEDURES Introduction 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 trustrelated 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 The Interior Fiduciary Library is being stocked. Categories of information were established and selected items in each category were posted, thereby making the information easily available to OST personnel in Albuquerque, Washington, and field locations. Major categories (or items) now found in the Library include:  Appendix F from the “As-Is” Model, entitled “List of Obligations”  BLM Policies and Procedures  Court opinions  Congressional testimony  Court orders  Informational press releases  Status Reports to the Court  Departmental Manual Chapters  United States Code  1994 Act  Departmental Manual, Part 303, Chapter 2 Indian Trust Responsibilities - Principles for Managing Indian Trust Assets  Secretarial Order 3215, Principles for the Discharge of the Secretary's Trust Policy Responsibility (replaced by DM Part 303, Chapter 2). Policy and procedure information provided by the OTP liaison group (as identified in previous reports to the Court) is expected to be combined with information from the “As-Is” and “To-Be” projects. The goal is to use the Library to make this information available throughout Interior and to the public. The following policies and procedures were signed by the appropriate officials during this reporting period: Acceptance of Address Change from a Third Party for an Unsupervised IIM Account Desk Operating Procedure Income Interest Factor Process 44 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Regulations, Policies and Procedures May 3, 2004 Desk Operating Procedure Fax Cover Sheet and Instructions for TFAS Transactions Desk Operating Procedure Establishing an IIM Account Current Status The OTP liaison group received a briefing report from OTP during this reporting period. OTP plans to continue sending briefing reports to the liaison group at regular intervals, updating them on SiteScape Enterprise Forum (SiteScape) and on the progress of the “To-Be” Model. Group members were asked again for potential SiteScape users and lists of their existing policies and procedures. On March 31, 2004, OTP personnel held a meeting with BOR and USGS to review areas of interest raised by those two bureaus. OTP continues to work with OST’s OCIO to establish SiteScape as a viable information management and dissemination tool. During this reporting period, OTP extended SiteScape access to the Director of BIA PPA in Washington, DC, and to selected OST staff in Washington, DC. Use of SiteScape at various Interior field locations will be a priority during the next reporting period. 25 CFR 124 – Deposits of Proceeds of Lands Withdrawn for Native Selection Under the Alaska Native Claims Settlement Act. The proposed rule remains on schedule to be published during the third quarter of CY2004. During this reporting period, OTP continued to coordinate the development of a final draft of the Appraisal Handbook for review and approval by OST. The draft handbook, written by OAS, has undergone several revisions and therefore was not released as expected in this reporting period. It is expected to be released for additional Interior bureau and office comments in the next reporting period. Delays and Obstacles Lack of Internet access and its repository of online statutes, the Federal Register and other resources continues to present challenges to this office. Instead of merely using hyperlinks to access a vast number of statutes, regulations, court decisions and the like, we must choose which documents to obtain and place on our Infonet server. 45 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Regulations, Policies and Procedures May 3, 2004 Assurance Statement 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 Seventeen. The information provided in this section is accurate to the best of my knowledge and belief. Date: April 27, 2004 Name: Signature on File Richard V. Fitzgerald, Director Office of Trust Regulations, Policies and Procedures Office of the Special Trustee for American Indians 46 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Appraisal May 3, 2004 D. FIELD OPERATIONS 1. APPRAISAL Introduction The Office of Appraisal Services is responsible for the Indian land valuation program, which 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 land actions require valuations. To meet this requirement, an appraisal or other valuation method is used to ensure that fair and just compensation is received on Indian land transactions. The types of land actions are varied. Major types include commercial, industrial, recreational, agricultural and other types of leases; rights-of-way; land sales and land exchanges; grazing and range permits and assessment of trespass damages. Accomplishments and Completions As previously reported, a decision on whether OAS would join the Interior Appraisal Group was to be made by the end of March 2004. On March 31, 2004, the Special Trustee announced that, rather than being a part of the Interior Appraisal Group’s consolidation effort at this time, OST would instead enter into an agreement with the Interior Appraisal Group for the management of OAS. This agreement will allow OAS to benefit from the expertise of Interior’s Chief Appraiser, while retaining Indian preference in hiring, the ability to contract or compact with Tribes and the current regional presence so important to beneficiaries. Current Status As previously reported, the Assistant Secretary, Policy, Management and Budget, issued a memorandum on August 6, 2003, establishing hiring controls for real estate appraiser positions. During this reporting period, OST received approval to recruit and hire for the three vacant Supervisory Appraiser positions. OST expects to advertise the Supervisory Appraiser positions during the next reporting period. Work continues on the OST-OAS Appraisal Handbook. Following submission of the draft handbook to OTP, it was determined that further revisions were required. In addition, as a result of the new agreement with the Interior Appraisal Group, the draft handbook is expected to be provided to Interior’s Chief Appraiser for further review. As previously reported, BIA and OST have continued to work with SOL on appraisal requirements pertaining to the Eastern Cherokee Agency. During this reporting period, BIA and OST agreed upon a draft policy for the Eastern Band of Cherokee Indians that provides guidance and clarification on certain subleases of tribal land that would not require an appraisal. The policy is under review by SOL. 47 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Appraisal May 3, 2004 As previously reported, OST was seeking an independent contractor to review some right-of-way appraisals that were completed prior to September 2, 2003. The contract was awarded March 11, 2004. As previously reported, second-level reviews were conducted on right-of-way appraisals that were completed from September 2, 2003, through December 31, 2003. The report regarding these second-level reviews is expected to be finalized during the next reporting period. As previously reported, the Special Master for the Cobell litigation made a visit to OAS in Gallup, NM, and the BIA Navajo Realty Office in Window Rock, AZ. The Special Master issued a report regarding his findings. During the previous reporting period, a team of appraisal staff initiated a review of the report and prepared a draft analysis for OST management. The Special Trustee has determined that additional analysis is required and OST expects to contract for such additional analysis during the next reporting period. As previously reported, OAS is developing a Memorandum of Understanding with ILCO regarding ILCP. A draft MOU was developed during this reporting period and is under ILCO review. OAS and ILCO expect to finalize the MOU during the next reporting period. OAS continues to work on the appraisal backlog. During this reporting period, contracts to address the backlog were awarded and others are in the acquisition process. During the next reporting period, OAS and NBC expect to work cooperatively to establish national or regional contracts with independent contractors to perform appraisals. As of this reporting period, the appraisal backlogs are as follows: Appraisal Backlog Appraisal Backlog As of 03-31-04 Region As of 01-01-04 40 517 2 6 3 Northwest 288 Rocky Mountain Midwest 467 1 Western 0 Southwest 0 E. Oklahoma 0 19 Navajo 43 47 *Total: 799 634 *This table does not include appraisal backlog information from the compacted and contracted Tribes. During this reporting period, OAS worked with BIA regarding the compilation of an inventory of Tribes that compact and contract to perform appraisal functions. Upon receipt of this inventory, OST expects to follow up with Tribes to request their appraisal backlog information. 48 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Appraisal May 3, 2004 Delays and Obstacles 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. Assurance Statement I concur with the content of the information contained in the Appraisal section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 28, 2004 Name: Signature on File Gabriel Sneezy Acting Director, Office of Appraisal Services 49 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Current Accounting Activities May 3, 2004 E. TRUST SERVICES 1. CURRENT ACCOUNTING ACTIVITIES Introduction 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 an off-the-shelf, standard trust fund accounting system that provides the basic receipt, accounting, investment, disbursing and reporting functions common to commercial trust funds management operations. IIM accounts all have been converted to this system. SDA are temporary accounts for the deposit of trust funds that cannot immediately be credited to the proper account holders. As explained in BIA/OST Interagency Handbook Procedures, this type of account is to be used only as an exception to the rule that trust funds immediately be deposited and then distributed as soon as practicable to 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 transactional reporting to Treasury is accurate and 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. 50 STATUS REPORT TO THE COURT NUMBER SEVENTEEN May 3, 2004 a. Whereabouts Unknown Accounts Accomplishments and Completions During this reporting period, OST issued a new policy to permit acceptance of an address change from a third party for an unsupervised IIM account. Current Status During this reporting period, 537 accounts were added to the WAU list and 13,821 accounts were removed. As of March 31, 2004, there were 54,331 WAU with a balance of $83,425,073. The following table illustrates the number of accounts stratified by account balance and WAU category: Account balance Equal to or over $100,000 Under $100,000 and equal to or over $50,000 Under $50,000 and equal to or over $5,000 Under $5,000 and equal to or over $1,000 Under $1,000 and equal to or over $100 Under $100 and equal to or over $1 Under $1 Total Delays and Obstacles The regular influx of WAU accounts categorized as “account set up no address” causes the total number of WAU accounts to remain relatively constant. These accounts result primarily from probates that determine heirs that are WAU. Individuals who know they are, or know of someone else who is, on the WAU list but neglect or refuse to update their addresses have proven to be a challenge in reducing the number of WAU accounts. The lack of Internet access limits communication effectiveness. As a result, OST and its contractor must rely primarily on mail and telephone communication with IIM account holders. 51 Current Accounting Activities Total Correspondence/ Check Returned Refused/ Unclaimed Mail Awaiting Address Confirmation Account Setup No Address 22 12 0 0 34 38 15 1 0 54 2 3,864 2,680 1,171 11 5 9,318 6,490 2,764 59 8,688 4,981 301 20 13,990 20 20,279 9 6,792 11,451 8,282 526 3,896 2,748 139 33,265 19,973 1,037 56 54,331 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Current Accounting Activities May 3, 2004 Special Deposit Account Activity b. Trust Funds Accounting System Current Status OST continued working on an enhancement to TFAS to produce account holder statements that identify the source of income and a listing of all assets owned. Due to a delay, the enhancement is scheduled to be tested during the third quarter of CY2004 for the assets held by Concho and Anadarko Agency IIM account holders. OST continued working to further define the processes required to distribute income generated from real property assets to the owners of those assets. Due to delays, OST expects to finalize the technical design during the next reporting period. Testing now is expected to begin during the third or fourth quarter of CY2004. c. Accomplishments and Completions During this reporting period, aged funds were held in 14 additional SDA than in the previous reporting period, which represents an increase of 1,553 undistributed aged receipts and an increase of a combined dollar amount of $496,257.92. As of March 31, 2004, there were funds held in 831 SDA with a combined dollar amount of $3,524,373.25, which represented 4,674 undistributed receipts aged over 30 days from January 1, 2003, through March 31, 2004. TPMC staff members have worked at Rosebud and Fort Belknap Agencies to assist agency staff in performing any work necessary to distribute SDA funds. At Rosebud Agency, OST staff assisted in the research and preparation of journal vouchers to distribute 381 receipts totaling over $5,000 from 43 SDA. At Fort Belknap Agency, OST staff assisted in the distribution of nine receipts for $3,528.39 from nine accounts. In addition to assisting with research, OST staff helped agency staff to access reports on StrataVision. They provided training to agency staff on using the aging reports and navigating through TFAS. OST staff members plan to return to Rosebud in April and to schedule work at additional agencies. Current Status BIA has the responsibility for distribution of SDA funds received since January 1, 2003. It is the policy of BIA to distribute funds within 30 days of receipt into SDA. During this reporting period, TPMC has tracked over 10,000 receipts, offsetting them with distributions, and has aged and reported on 3,862 undistributed receipts. TPMC has researched or contacted the field to obtain lease and allotment numbers for over 15,000 transactions that were not encoded per BIA policy. As of March 31, 2004, there were 212 receipts in 119 SDA for $286,373.20 aged over one year. 52 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Current Accounting Activities May 3, 2004 TPMC and OST OCIO are in the process of moving SDA Pro, the database used for tracking, from MS Access to the MS Sequel platform. This will better facilitate multiple users and the voluminous data for faster processing. Development and testing is complete. Delays and Obstacles Some agencies still are not using Strata Vision to obtain current aging reports. During this reporting period, TPMC began sending a courtesy copy of monthly reports directly to Regional Directors for distribution to the agencies. There were various problems associated with the IRMS that impeded progress, such as the inability to print various reports that the staff needed for verification purposes, the hours of operation to use IRMS, and the number of staff allowed on the system simultaneously with maintenance capability to update ownership. The IRMS issues have been referred to the BIA Office of Information Resource Management in Reston, VA. d. Small Balance Accounts As of March 31, 2004, there were 20,168 accounts that have a $.01 - $1.00 balance with no activity for the previous 18 months. The total sum included in those accounts is $5,830.09. Statements are sent to accountholders for these accounts on an annual basis pursuant to direction from Congress. OST continues to explore options for reducing the administrative burden of these accounts. e. Accounting Discrepancies Accomplishments and Completions During this reporting period, the difference between the subsidiary account ledger and the IIM investment pool was reduced by $126,750 to approximately $5.8 million. The reduction was the result of SDA reconciliation activity that determined entries were made to one system and not the other. Current Status Efforts continue to resolve the $5.8 million difference between the subsidiary account ledger (liabilities) and the IIM investment pool (assets). Interior’s Office of Congressional and Legislative Affairs met with Senate Indian Affairs Committee staff in an attempt to determine the best way to get the legislation introduced. A procedure is being written to transfer non-trust WAU funds to the Unclaimed Moneys Account at Treasury. The transfer is a Treasury requirement (1 TFM 6-3000) for non-trust funds held by departments and agencies of the Government. There are 2,000 accounts in TFAS coded as non- Indian with a value of nearly $4.2 million that are potentially eligible for transfer. The funds to be transferred must be fully documented and identified as non-Indian and meet Treasury requirements before they can be transferred. The transfer is for administrative purposes only and 53 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Current Accounting Activities May 3, 2004 would not change the legal rights of the owners. OST would be required to initiate payment from the Unclaimed Moneys Account to owners who come forward with legitimate claims. The procedure is expected to be finalized and transfers are expected to begin by the end of the next reporting period. Assurance Statement I concur with the content of the information contained in the Current Accounting Activities section of the Status Report to the Count Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 30, 2004 Name: Signature on File D. Jeff Lords Acting Deputy Special Trustee, Trust Accountability Office of the Special Trustee for American Indians 54 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Regulations, Policies and Procedures May 3, 2004 IV. BUREAU OF INDIAN AFFAIRS TRUST REGULATIONS, POLICIES AND PROCEDURES A. Introduction The Office of Planning and Policy Analysis (PPA) in the Office of the Assistant Secretary – Indian Affairs (AS-IA), was established on April 21, 2003. PPA is responsible for ensuring BIA’s knowledge of, access to, and compliance with applicable regulations, policies, and procedures. 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. PPA:  coordinates development of strategic plans and annual performance reports in support of the Government Performance and Results Act;  determines the reliability of performance measures and evaluates the AS-IA and related bureau programs for effectiveness;  provides guidance and technical assistance to all programs under the purview of the Principal Deputy AS-IA to ensure compliance with Administration initiatives;  provides assistance for the development of manuals that set forth Indian Affairs program and administrative policies and handbooks documenting operating procedures;  publishes and maintains the Indian Affairs Manual (IAM), which contains the policies and general procedures that are essential to the efficient administration of Indian Affairs;  reviews applicable notices and rules that are prepared for publication in the Federal Register. Current Status 25 CFR 161 - Navajo Partitioned Lands Grazing Permits – The proposed regulations were published November 11, 2003. Public meetings were held in December 2003. Public comments were received by the February 10, 2004 deadline. BIA now plans to meet with the Navajo Nation in the next reporting period to discuss the comments and any changes that may be necessary, and to seek concurrence to publish a final rule by June 30, 2004. 25 CFR 162 Subparts C & D – Residential Leases and Business Leases – The proposed rule was published in the Federal Register on February 13, 2004. The comment period and tribal consultation is scheduled to be completed by May 10, 2004. The final rule is expected to be published by the end of the second quarter of FY2005. 25 CFR 216 - Surface Exploration, Mining, and Reclamation of Lands – BIA, BLM and SOL met during February 2004 to begin drafting the revised 25 CFR 216. This is an allinclusive minerals and mining regulation review, with possible changes to other CFR parts. Completion of initial reviews and rewrites is expected by the end of the third quarter of FY2004. 55 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Regulations, Policies and Procedures May 3, 2004 25 CFR 243 - Reindeer in Alaska – The proposed rule was published in the Federal Register on March 11, 2004. The comment period runs until June 9, 2004. The final rule is expected to be published by October 2004. Directives Library – The project continues on schedule, with the electronic library expected to be functional in the first quarter of FY2005. Directives Handbook – The draft handbook is expected to be released to the Regional Offices and Central Office for review by the fourth quarter of FY2004. Publication is expected by the second quarter of FY2005. Surface Leasing (25 CFR 162) Handbook – The draft handbook for surface leasing contains separate parts for business, residential and agricultural leases. It is expected to be updated after the revision of 25 CFR 162 subparts C & D is completed. Final publication of the handbook now is expected by the third quarter of FY2005. Fee-to-Trust Handbook – The handbook, describing how BIA will process fee lands into trust, has been drafted and is expected to be published by the second quarter of FY2005. Trust-to-Trust Handbook – The handbook, describing how BIA will process trust lands acquisitions, has been drafted and is expected to be published by the second quarter of FY2005. Rights-of-Way Handbook – The handbook, describing how BIA will address rights-of-way issues, has been drafted and is expected to be published by the second quarter of FY2005. Grazing Permits (25 CFR 166) Handbook –BIA, SOL and subject matter expert comments have been incorporated into the draft handbook. It mistakenly was reported in the previous report to the Court that public comments were received on this internal BIA publication. BIA plans to publish the handbook for internal comment only. The internal comment period will end by July 1, 2004, with final publication expected by the end of the second quarter of FY2005. National Environmental Policy Act Compliance Handbook –The draft is expected to be provided for internal review and public comment in April 2004, with comments due in June 2004. The final handbook is scheduled for publication by the end of FY2004. IAM Parts 1, 2, 3 and 7 containing delegations of authority – BIA comments have been received and these parts are on schedule for publication in the third quarter of FY2004. IAM Part 13 - Indian Self-Determination – Modifications to the existing part are under review by BIA. Publication of the changes is expected in the fourth quarter of FY2004. IAM Part 25 – Safety and Occupational Health – Modifications to the existing IAM are under review by BIA. Publication of the changes is expected in the fourth quarter of FY2004. 56 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Trust Regulations, Policies and Procedures May 3, 2004 Bureau of Indian Affairs Manual (BIAM) Conversion to IAM – The following list identifies the planned finish dates for converting the remaining BIAM parts to IAM format. BIAM Part Title 19 ACQUISITION AND GRANT AGREEMENT 25 SAFETY MANAGEMENT 35 INFORMATION RESOURCES MANAGEMENT 42 FINANCIAL MANAGEMENT 43 PROPERTY AND SUPPLY MANAGEMENT 46 FACILITIES MANAGEMENT 51 INDIAN RIGHTS PROTECTION 54 RESOURCES/LAND 54 REAL PROPERTY MANAGEMENT 57 ROAD CONSTRUCTION 58 ROAD MAINTENANCE 62 EDUCATION 66 SOCIAL SERVICES Delays and Obstacles Lack of access to the Internet has hindered PPA’s ability to research statutes and departmental manuals. Assurance Statement 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 Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: May 3, 2004 Name: Signature on File Jerold Gidner Director, Office of Planning and Policy Analysis Bureau of Indian Affairs 57 Planned Finish 9/30/2004 7/1/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 12/31/2004 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Fractionation May 3, 2004 B. FRACTIONATION Introduction Fractionation of Indian trust and restricted land stems from the federal Indian policy of the 19th 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 2000. ILCO is operating pilot projects and, from there, a nation-wide plan is being designed to promote consolidation of the ownership of Indian land. Accomplishments and Completions  Acquired 9,383 fractional interests during this reporting period, for a cumulative total of 78,321 interests for the Indian Land Consolidation Project pilot projects in the Midwest and Great Plains Regions through March 31, 2004. Of the total interests acquired, 90% were interests of less than 2% ownership in the respective tracts of land.  Acquired a cumulative total equivalent of 49,155 acres for the pilot project reservations. Current Status As previously reported, ILCP is presently operating within two BIA regions on seven reservations. Current ILCP activities include:  Drafting a national expansion plan that is expected to be completed by the end of FY2004;  Developing an acquisition plan for Youpee interests based on voluntary sales (a draft of this plan is expected to be completed during the next reporting period);  Continuing to process applications and purchase interests;  Developing a case management system in FY2004 to automate application processing and tracking of acquired land interests;  Expanding the pilot program to at least six additional reservation sites in FY2004:  Standing Rock and Pine Ridge in South Dakota, and Winnebago in Nebraska (Great Plains Region);  Gila River in Arizona (Western Region);  Navajo in Utah, Arizona and New Mexico (Navajo Region);  Crow in Montana (Rocky Mountain Region). Delays and Obstacles  The need to reconcile ownership records causes delays in expansion of ILCP. Reconciliation efforts are expected to improve as a result of the ongoing implementation of the CGI title system. 58 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Fractionation May 3, 2004  There is a challenge recruiting qualified staff at remote locations.  Probate backlog and Youpee issues continue to impede the land-purchase transaction process. Assurance Statement I concur with the content of the information contained in the Fractionation section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 27, 2004 Name: Signature on File Robert R. Jaeger Director, Indian Land Consolidation Office Bureau of Indian Affairs 59 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Probate May 3, 2004 C. PROBATE Introduction 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 during the probate process. Accomplishments and Completions Case Preparation Case Preparation is the initial stage of the probate process. During this stage of the process, information is researched and gathered regarding the identity and whereabouts of presumptive heirs, and an inventory of the trust assets of an estate is prepared. As of this reporting period, 15,452 probate cases were in the case preparation stage. Case Adjudication In the Case Adjudication stage, deciding officials are OHA Administrative Law Judges (ALJ), OHA Indian Probate Judges (IPJ) and BIA Attorney Decision Makers (ADM). ADM have authority to probate and determine the heirs in estates containing trust cash assets less than $5,000. In addition, ADM have the authority to probate estates containing land and/or cash assets that do not present questions of law or fact. In the latter instance, where there is an issue of law or fact, the estate must be sent to ALJ or IPJ for adjudication. In this reporting period, BIA deciding officials received 210 cases and issued decisions in 104 cases; OHA deciding officials received 997 cases and issued decisions in 961 cases. Case Closure Case closure is the posting and recording of ownership and distribution of assets after the case has been adjudicated. The posting, distribution and recording is broken into three categories:  Posting and recording of agency ownership records.  Posting and recording of LTRO records that result from probate decisions.  Posting, recording and distribution of financial information in TFAS. In this reporting period, OST distributed and closed 984 accounts representing 949 estates. TFAS, as of the end of March 2004, contains 27,363 open estate accounts, up from 26,659 open estate accounts at the end of the last reporting period. 60 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Fractionation May 3, 2004 Establishment of BIA Probate and Estate Services Branches In January 2004, BIA created a new Probate and Estate Services Branch to be established at each regional office. This reorganization dedicates staff to work on the probate process. The regions have begun implementing this change, which is expected to be completed in early FY 2005. Standardized position descriptions for the probate staff have been circulated and approved and now are being implemented for BIA’s probate staff. The standard position descriptions are expected to provide consistency throughout BIA regarding probate duties and responsibilities. Current Status Probate Case Management and Tracking System The new probate tracking system (ProTrac) was developed to provide probate case tracking information and to assist in the management of probate cases within BIA, OHA and OST. Field testing and user acceptance testing occurred during the reporting period. ProTrac is scheduled for implementation in April 2004 and will replace the spreadsheet report described in previous reports to the Court. Probate Handbook Interior’s draft Handbook of Indian Probate Procedures, dated September 30, 2003, was circulated in final draft form and reviewed by field probate users. As a result, a handbook review team is being established to coordinate the revision of the handbook. The review team expects to begin their efforts during the first part of June 2004. The handbook still is scheduled to be published in CY2004. Probate Process – Small Estates As discussed in previous reports to the Court, there is an ongoing effort to streamline the probate process for small estates. Proposals designed to change and improve the process used for small estates continue to be circulated. Delays and Obstacles The following obstacles have been identified as having an impact on the progress of the probate program:  Lack of consistency in program management, which is being addressed by the establishment of a BIA Probate and Estate Services Branch;  Lack of adequate staffing for probate processing in the field, which is being addressed by designating dedicated personnel and by expanding contractor support;  Lack of a comprehensive case management and tracking system, which is being addressed by the implementation of ProTrac; 61 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Fractionation May 3, 2004  Lack of access to the Internet, which includes the inability to use electronic mail communication between OHA and BIA/OST;  Fractionation of ownership of Indian lands;  Numerous initiatives competing for resources (e.g., Youpee revestitures, Cobell requirements, CGI title conversion, realty system development);  Cultural diversities regarding the subject of death. Assurance Statement I concur with the content of the information contained in the Probate section of the Status Report to the Court Number Seventeen. The information provided in this section is accurate to the best of my knowledge. Date: April 28, 2004 Name: Signature on File Sharlene M. Round Face Realty Specialist Western Region Bureau of Indian Affairs 62 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Acronyms and Abbreviations May 3, 2004 American Indian Trust Fund Management Reform Act of 1994 Office of Management and Budget Circular A-130 Appendix III ACRONYMS AND ABBREVIATIONS 1994 Act (or Act) A-130 ADM Attorney Decision Makers AFMSS Automated Fluid Mineral Support System AIRR American Indian Records Repository ALJ Administrative Law Judges ARO Alaska Regional Office ART Accounting Reconciliation Tool AS-IA Assistant Secretary-Indian Affairs BIA Bureau of Indian Affairs BIAM Bureau of Indian Affairs Manual BLM Bureau of Land Management BOR Bureau of Reclamation BPA Blanket Purchase Agreement C&A Certification and Accreditation CARS Cadastral Automated Request System CDE Critical Data Elements CGI Software vendor successor to TAAMS vendor CGIS Cadastral Geographic Information Systems CIO Chief Information Officer CISSP Certified Information System Security Professional COTS Commercial off-the-shelf CSIRC Computer Security Incident Response Capability CSIRT Computer Security Incident Response Team CTM Comprehensive Trust Management Plan DEAR DOI Enterprise Architecture Repository DM Departmental Manual DOI Department of the Interior DQ&I Data Quality and Integrity ENA Eastern Navajo Agency EORO Eastern Oklahoma Regional Office ERO Eastern Regional Office FAR Federal Acquisition Regulation FIMO Farmington Indian Minerals Office FISMA Federal Information Security Management Act GCDB Geographic Coordinate Data Base GIS Geographic Information System GPRO Great Plains Regional Office GPS Global Positioning System GSS General Support Systems IAM Indian Affairs Manual IATO Interim Approval to Operate IIM Individual Indian Money IITD Individual Indian Trust Data 63 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Acronyms and Abbreviations May 3, 2004 Management & Accounting Distribution System Missing Mandatory Documents for Unrestricted Accounts Midwest Regional Office National Association for Public Health Statistics and Information System National Archives and Records Administration ILCA Indian Land Consolidation Act ILCO Indian Land Consolidation Office ILCP Indian Land Consolidation Project Interior Department of the Interior IPJ Indian Probate Judges IRM Information Resources Management IRMS Integrated Records Management System IRS Internal Revenue Service ISA Information Security Assessment IT Information Technology LAN Local area network LRIS Land Records Information System LTIC Land Tenure in Indian Country LTRO Land Titles and Records Office MA Major Applications MADS MMD MMS Minerals Management Service MOU Memorandum or Memoranda of Understanding MRM Minerals Revenue Management MWRO NAPHSIS NARA NBC National Business Center NIST National Institute of Standards and Technology NPS National Park Service NRO Navajo Regional Office NWRO Northwest Regional 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 OMB Office of Management and Budget 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 PLSS Public Land Survey System PMSO Project Management Support Office Post-QA Post Quality Assurance PPA Office of Planning and Policy Analysis PRO Pacific Regional Office ProTrac Probate Case Management and Tracking System 64 STATUS REPORT TO THE COURT NUMBER SEVENTEEN Acronyms and Abbreviations May 3, 2004 Putnam Report Federal Computer Security Report Card, Committee on Government Reform, U.S. Congress QA Quality Assurance QC Quality Control RAF Recommended Action Forms REM Real Estate Module RFP Request for Proposal RM-PLUS Risk Management Assessment/Evaluation tool RMRO Rocky Mountain Regional Office SANS SysAdmin, Audit, Network, Security SDA Special Deposit Accounts SDLC System Development Life Cycle SMS System Management Servers SOL Office of the Solicitor SPRO Southern Plains Regional Office SSA Social Security Administration SSM System Security Manager SSP System Security Plan ST&E Security Test and Evaluation SUS System Update Servers SWRO Southwest Regional Office TAAMS Trust Asset and Accounting Management System TAP Technical Architecture Profile 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 USGS United States Geological Survey WAN Wide area network WAU Whereabouts Unknown WRO Western Regional Office 65