By KEVIN FREKING
Associated Press

WASHINGTON - Payments of at least $1,500 each will go to the vast majority of American Indians participating in a long-running lawsuit against the federal government, and many will receive considerably more. It may not sound like much in the nation's capital, but for many recipients, the payment will feed a family for a few months.

With that admonition, Elouise Cobell of Browning, Mont., urged senators Dec. 17 to quickly sign off on a $3.4 billion settlement that would bring a partial remedy to hundreds of thousands for the government's mismanagement of Indian trust funds.

"We are compelled to settle now by the sobering reality that our class grows smaller each year, each month and every day," said Cobell, the lead plaintiff in a lawsuit filed in June 1996. "We also face the uncomfortable but unavoidable fact that a large number of individual Indian-trust beneficiaries are among the most vulnerable people in this country, existing in sheer poverty."

The Interior Department manages about 56 million acres of land. It leases the land for mining, grazing and oil and gas production. It also collects money from those leases and distributes it to more than 384,000 individual Indian accounts and about 2,700 tribal accounts.

In the lawsuit, the plaintiffs said the government had breached its responsibility to manage assets belonging to American Indians and that it refused to fix a flawed accounting system that led to billions of dollars being lost without explanation.

Sen. Byron Dorgan, D-N.D., used harsher language, saying the government "bilked" many trust-account holders. He expects lawmakers overwhelmingly to sign off on the settlement, but wasn't sure it could be done before the end of the year, as the term's settlement dictates. He said Congress may need an extension.

"I support the decision. I think it was a wise choice," he told Cobell. "It will bring substantial benefit to those who have been injured."

Dorgan is chairman of the Senate Indian Affairs Committee, which held the first hearing on the settlement since it was announced last week. Under terms of the settlement, a fund totaling $1.4 billion will compensate participants for past accounting problems and resolve potential claims that assets were mismanaged. Legal fees also will be paid out through the $1.4 billion fund.

Another $2 billion will be used to buy back fractional land interests from voluntary sellers. Often, hundreds of people, even thousands, own a single parcel of land, which makes it difficult for the U.S. to administer the program. The consolidation effort is designed to give individual Indians money for their fractional land interests and help the U.S. cut down on future administration expenses and accounting woes.

Interior Secretary Ken Salazar said the lawsuit was a blight on the government. A settlement was necessary to help establish the kind of trust and cooperation that will be needed to deal with such issues as improving education and law enforcement on reservations, he said.

Senators asked how much will be paid out in attorneys fees. The amount, ranging from $50 million to $99.9 million will be left to a judge, officials said.