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Accounting for Indian Lands

Readers write to say who's really in charge of accounting for American Indian land, how financial centers benefit second-tier cities, and why national health-care organizations fail to provide what locals need.
CFO Staff, CFO Magazine
November 1, 2007

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The historical accounting in the Cobell case (The Long Trail) is being performed by the Office of Historical Trust Accounting, which reports to the Special Trustee. The Office of the Special Trustee for American Indians (OST) assists and cooperates with the OHTA, but is not performing the historical accounting.

Further, the Court has ordered the Department of the Interior to perform an accounting, not determine liability. The accounting is — and will be — the reporting to Indians of the complete transaction history in their account, and includes reporting on known errors in the account.

Jeff Zippin
Deputy Director
Office of Historical Trust Accounting
Via E-mail

Editor's Response:
Mr. Zippin is right. The actual accounting work in the Cobell case is being performed by the OHTA. But as he also notes, that division of the Interior Department reports to the OST, the agency specifically created by Congress to oversee all issues related to Native American trusts. Indeed, the OHTA's funding is an item in the OST budget. It's hard for us to imagine officials at the OHTA making any major decision without conferring with — or getting approval from — the OST. When we spoke to an engagement partner at one of the accounting firms working directly on the project, the partner declined to comment, then directed us to the office of the Special Trustee, not the OHTA. Still, we should have credited the OHTA, and for that lapse we apologize.

As for Mr. Zippin's other points: the thrust of the story is that many tribal leaders believe the Historical Trust Accounting Project is not a true accounting project but an attempt to limit liability in the Cobell (and other) lawsuits. And while Mr. Zippin is correct — known errors will be indicated in reports to beneficiaries — the level of documentation needed to verify the transactions remains controversial.


I learned a lot from your article, but I do have one semantic issue. In the sidebar, "Divide and Conquer," you wrote: "That legislation, ostensibly an attempt to assimilate Native Americans, gave each member of a recognized tribe up to 160 acres of land, to be held in trust by the government."

The reservations were actually already tribal property held in common, sometimes as a federal reservation of former tribal lands, or, under the Indian Removal Act of 1830, held as common tribal title under a Fee Patent issued by the President.

While it may seem accurate to divide tribal lands among the individual living members, it was still a "taking" from the future members of the tribes. But since the lands were tribal lands, the word "gave" is inaccurate. It's kind of like dissolving a corporation by giving one stockholder a desk and another a computer screen and another a box of paper. And it should be noted that the lands were allotted to individuals without any consideration of the capital investment required to improve the lands, putting pressure on many families to either lease their lands out or sell a portion of them in order to be able to afford to live on the remainder.

Rob Trepp
Via E-mail


Second-Tier Benefits

As a commercial real estate adviser, I found the subject of your October Insight ("If You Build It, Will They Come?") intriguing and the analysis spot-on. Emerging collaboration tools and rapidly accelerating communications infrastructure are significantly affecting how employees work with their colleagues internally and business partners externally.

In addition to your analysis on the changing landscape of financial centers, I would like to expand on economists Nicholas Crafts and Anthony Venables's quote regarding back-office relocation. As firms slough off their back-office employees from their flagship offices in the financial centers, those "depleted manufacturing cities" that you mentioned are receiving significant benefits as second-tier office markets that can accept those divisions of firms. We have seen it in our industry, with cities like Hoboken, Milwaukee, and Duluth accepting back-office teams from firms with front-office operations in Manhattan, Chicago, and Minneapolis, respectively. Thankfully for those second- and third-tier cities, this phenomenon is providing a nice trickle-down benefit.


Jacob Cynamon
Via E-mail


Health Care Is Local

"Critical Condition" (September) is an understatement in describing the plight of national hospital chains. Let's face it: health care is local, because to be in touch with the local community and its needs, the decisions and the decision-makers must be local.

The arguments in favor of large hospital organizations include the benefits of "economy of scale" and "state-of-the-art" or "benchmark" care. But the example of Tenet Healthcare certainly doesn't support that. There obviously is no semblance of economy of scale. If that were true, Tenet's facilities would not have made a list of the top 100 most-expensive hospitals in the United States.

Doctors and practitioners do not want to be involved in an organization that makes decisions that affect their reputation or ability to provide care. They want to be able to assess a situation, make a decision, and act upon it. Their reputation should be based on their decisions — not some administrator or executive making a poor decision "up the chain."

Local health-care practitioners are reacting to this blatant neglect of the large national health-care organizations. Every institution or practitioner cannot be everything to everyone. A focus on delivering the best patient care will provide quality and promote cost savings. Some call this cherry-picking; I call it common sense.

Karen Costa-Natario
Via E-mail




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