The Senate has approved funding for a $3.4 billion settlement in a long-running dispute involving the mismanagement of Indian Trust lands and the federal government’s failure to provide a regular accounting for the beneficiary trust funds and assets.

The settlement in the case came Friday in conjunction with a $1.25 billion settlement with black farmers who experienced discrimination from the U.S. Department of Agriculture in receiving farm loans and credit.

“Black farmers and Native American trust account holders have had to wait a long time for justice, but now it will finally be served,” said Senate Majority Leader Harry Reid, D-Nev. “I am heartened that Democrats and Republicans were able to come together to deliver the settlement that these men and women deserve for the discrimination and mismanagement they faced in the past. This issue has been of great importance to me, and I am pleased these long-suffering Americans can now receive the closure that they deserve.”

The $3.4 billion Native American trust settlement came in December 2009 after 14 years of litigation. In 1996, Elouise Cobell and three other named plaintiffs filed a class-action lawsuit against the federal government for failing to properly manage Indian trust assets on behalf of all Indian trust beneficiaries, including over 300,000 account holders.

In its capacity as trustee under the General Allotment Act of 1887, the federal government is supposed to be responsible for approving all leases and sales of natural resources on Indian lands, for collecting payments on behalf of the beneficial Indian owners of the land, and disbursing these funds to the Indians to whom the money belongs. Since that time, the government has collected billions of dollars from farming and grazing leases, timber sales, mining and oil and gas production on Indian lands, which it was required to disburse to Indian owners.

As trustee, the federal government has had a longstanding duty to provide a regular accounting for the beneficiary trust funds and assets but has never provided one, according to the plaintiffs. In an attempt to prod the federal government to discharge its accounting obligation, Congress enacted the American Indian Trust Fund Management Reform Act of 1994, and Cobell and her co-plaintiffs filed suit two years later.

The settlement last December was agreed to by the Interior Department in the class-action lawsuit of Cobell v. Salazar, but the funding for that settlement and the black farmer settlement failed to materialize after they were included in mammoth tax extender bills that so far have not passed in the Senate because of opposition to the tax-raising offsets, such as increasing the taxes on the carried interest income of hedge fund managers. The House has previously approved the settlement twice, but will now need to approve the Senate version before it goes to President Obama’s desk.

“After 14 years in litigation, I am pleased that the Senate today took the next step toward bringing a small measure of justice to Native Americans victimized by the government-run individual Indian Trust,” Cobell said in a statement. “The U.S. House of Representatives still needs to pass the pending legislation. It has passed two previous bills approving the settlement. Once this measure is signed by President Obama we will finally be able to return to the courts to begin the process of restoring funds to Indian people across the nation.”

One of the issues holding up approval of the settlement was the question of how much of the settlement money should go to the attorneys. The Senate eventually sidestepped that question by leaving the decision up to the judge presiding over the case and not specifying a cap on attorney fees. To pay for the settlement, the Senate decided to take money from a surplus in nutrition programs and extend customs user fees.

The bill also included a one-year extension of the Temporary Assistance to Needy Families program, which provides safety-net assistance to American families with dependent children in the form of job training and job search support, child care and transportation in addition to other services that help people transition back to work.

In addition, the bill contained the Crow-Montana Water Rights Compact, which outlines the tribe’s authority over distributing, allocating and leasing water rights. It also provides funding for the development of water resources for irrigation, power and other uses.

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