Navajo to get $554 million in settlement with US over mismanagement; largest deal of its kind

The Navajo Nation is poised to receive $554 million from the federal government over mismanagement of tribal resources in the largest settlement of its kind for an American Indian tribe.

Much of the land on the 27,000-square-mile reservation has been leased for things like farming, grazing, oil and gas development, mining and housing.

The leases once were largely overseen by the U.S. government, which mismanaged the revenue and failed to properly invest and account for it, according to the tribe.

U.S. Interior Secretary Sally Jewell is scheduled to visit Window Rock on Friday to formally recognize the settlement.

"The historic agreement strengthens the government-to-government relationship between the United States and the Navajo Nation, helps restore a positive working relationship with the Nation's leaders and empowers Navajo communities," Jewell said in a statement Thursday.

Navajo officials hailed the settlement as a positive end to a long ordeal.

"The trust litigation has been a protracted battle and in the end, it was a victory for tribal sovereignty," Tribal President Ben Shelly said in a statement.

The tribe agreed to settle the case earlier this year but was awaiting signatures from federal agencies before the deal could be finalized. The Navajo Nation originally sought $900 million when the lawsuit was filed in 2006.

The Navajo Reservation is larger than any single American Indian land base, covering sections of Arizona, New Mexico and Utah. Almost two-thirds of the 300,000 Navajos live on the reservation that has some of the most iconic landscapes in the Southwest and is rich in natural resources.

Public meetings will be held to seek community input on how the money should be spent, Navajo Nation Council Delegate Lorenzo Curley said. The first meeting is scheduled for October. Some tribal members have suggested that it be set aside for future generations or used for business development, he said.

Deswood Tome, an adviser to Shelly, said the money could help with housing, water, roads, power line extensions and other infrastructure needs.

"There's a critical housing shortage on the Navajo Nation," Tome said.

About 70 percent of the roads on the reservation are unpaved, an estimated 16,000 families don't have electricity and many more don't have telephone service, water or natural gas services, according to the tribal utility provider.

Andrew Sandler, one of the Navajo Nation's attorneys on the case, said the tribe has taken on much of the responsibility for leasing on its land. If further disputes arise with the federal government, the settlement outlines a process to resolve them.

"It was a good result for all parties, an appropriate result for all parties, and it creates finality," Sandler said.

The Navajo Nation includes more than 14 million acres of trust lands, which are leased for grazing, farming, oil and gas development and other purposes. The tribe owns or has ownership interests in more than 100 trust accounts, according to the U.S. Department of Interior. The federal government mismanaged the extraction of natural resources on Navajo land, Sandler said.

In addition, the Navajo Nation didn't get entitled royalties and the U.S. government failed to appropriately invest money that came from natural resource contracts.

Tribes across the country have filed more than 100 breach-of-trust cases against the U.S. government. The Navajo Nation settlement is the largest, exceeding the next highest amount by $170 million, Sandler said.

Meanwhile, hundreds of thousands of Native Americans elsewhere received final cash payments last week in one of the largest settlements involving individual trust funds in U.S. history. The $3.4 billion Cobell settlement, named for Elouise Cobell of Browning, Montana, resolves a class action lawsuit over billions of royalties lost from the accounts of individual Indians.

Sandler called today's Navajo settlement and the Cobell one "probably the two most important resolutions of claims against the U.S. government by American Indians or sovereign tribes."

The Interior Department said it is working to resolve cases with other tribes without going to trial. Since October 2010, the Obama administration has settled about 80 cases, totaling more than $2 billion.

Sandler said the Navajo Nation should receive its money within 60 days.

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Terry Tang reported from Phoenix.