A-7677, APRIL 21, 1926, 5 COMP. GEN. 839

A-7677: Apr 21, 1926

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

ARE NOT PROPERLY FOR CREDIT TO THE TRUST FUND "INDIAN MONEYS. " EXCEPT IN CASES WHERE THE MONEYS INVOLVED AS PRINCIPAL WERE ORIGINALLY OF THE CLASS SPECIFICALLY AUTHORIZED BY LAW TO BE COVERED INTO THE TREASURY TO THE CREDIT OF THAT TRUST FUND. THE MONEYS WITHDRAWN FROM THE TREASURY AND DEPOSITED IN SUCH BANKS HAVE NOT BEEN SEGREGATED INTO INDIVIDUAL SHARES AS AUTHORIZED BY THE FIRST DIVISION OF THAT SECTION. " WILL NOT. IT BEING UNDERSTOOD THAT THE TOTAL AMOUNTS OF EXPENDITURES THEREFROM WILL NOT EXCEED THE AMOUNTS AUTHORIZED TO BE EXPENDED FROM TRIBAL FUNDS PURSUANT TO THE PROVISIONS OF SECTION 27 OF THE ACT OF MAY 18. 1926: I HAVE YOUR LETTER OF MARCH 16. ARE NOT FOR CREDIT TO THE TRUST FUND.

A-7677, APRIL 21, 1926, 5 COMP. GEN. 839

ACCOUNTING - TRUST FUNDS - INDIAN MONEYS, PROCEEDS OF LABOR REVENUES DERIVED FROM INTEREST ON TRIBAL FUNDS AND DEPOSITED IN BANKS PURSUANT TO THE PROVISIONS OF SECTION 28 OF THE ACT OF MAY 25, 1918, 40 STAT. 591, ARE NOT PROPERLY FOR CREDIT TO THE TRUST FUND "INDIAN MONEYS, PROCEEDS OF LABOR," EXCEPT IN CASES WHERE THE MONEYS INVOLVED AS PRINCIPAL WERE ORIGINALLY OF THE CLASS SPECIFICALLY AUTHORIZED BY LAW TO BE COVERED INTO THE TREASURY TO THE CREDIT OF THAT TRUST FUND, AND THE MONEYS WITHDRAWN FROM THE TREASURY AND DEPOSITED IN SUCH BANKS HAVE NOT BEEN SEGREGATED INTO INDIVIDUAL SHARES AS AUTHORIZED BY THE FIRST DIVISION OF THAT SECTION. THE CREDITING OF SUCH INTEREST REVENUES TO "INDIAN MONEYS, PROCEEDS OF LABOR," WILL NOT, HOWEVER, BE FURTHER QUESTIONED DURING THE PRESENT FISCAL YEAR ENDING JUNE 30, 1926, IT BEING UNDERSTOOD THAT THE TOTAL AMOUNTS OF EXPENDITURES THEREFROM WILL NOT EXCEED THE AMOUNTS AUTHORIZED TO BE EXPENDED FROM TRIBAL FUNDS PURSUANT TO THE PROVISIONS OF SECTION 27 OF THE ACT OF MAY 18, 1916, 39 STAT. 158.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE INTERIOR, APRIL 21, 1926:

I HAVE YOUR LETTER OF MARCH 16, 1926, REQUESTING RECONSIDERATION OF THAT PART OF DECISION OF THIS OFFICE DATED FEBRUARY 11, 1926, A-7677, HOLDING THAT REVENUES DERIVED FROM INTEREST ON TRIBAL FUNDS DEPOSITED IN BANKS PURSUANT TO THE PROVISIONS OF THE ACT OF MAY 25, 1918, 40 STAT. 591, ARE NOT FOR CREDIT TO THE TRUST FUND,"INDIAN MONEYS, PROCEEDS OF LABOR," BUT SHOULD BE CREDITED TO THE PRINCIPAL AMOUNT SO DEPOSITED, SUCH INTEREST HAVING BECOME A PART OF THE MONEYS SEGREGATED AND PLACED ON DEPOSIT.

YOU NOW STATE THAT ALL THE TRIBAL FUNDS WHICH HAVE BEEN WITHDRAWN FROM THE TREASURY AND DEPOSITED IN BONDED BANKS UNDER THE PROVISIONS OF THE ACT REFERRED TO WERE SO WITHDRAWN AND DEPOSITED UNDER THE SECOND PROVISION OF SECTION 28 OF SAID ACT AUTHORIZING THE SECRETARY OF THE INTERIOR TO WITHDRAW FROM THE TREASURY AND DEPOSIT IN BANKS IN THE STATE OR STATES IN WHICH THE TRIBE IS LOCATED TO THE CREDIT OF THE RESPECTIVE TRIBES SUCH COMMON OR COMMUNITY TRUST FUNDS AS ARE NOT SUSCEPTIBLE OF SEGREGATION AND ON WHICH THE UNITED STATES IS NOT OBLIGATED BY LAW TO PAY INTEREST AT HIGHER RATES THAN CAN BE PROCURED FROM THE BANKS. IT IS EVIDENT THAT MONEYS THUS WITHDRAWN AND DEPOSITED UNDER SUCH CIRCUMSTANCES, NOT HAVING BEEN SEGREGATED INTO INDIVIDUAL SHARES, RETAIN THEIR STATUS AS TRIBAL FUNDS AND AS SUCH MAY BE CONSIDERED WHILE ON DEPOSIT AS COMMON OR COMMUNITY TRUST FUNDS BELONGING TO THE TRIBE OR TRIBES INVOLVED. WHAT WAS SAID IN MY LETTER TO YOU OF FEBRUARY 11, 1926, HAD REFERENCE GENERALLY TO ALL FUNDS DEALT WITH IN SECTION 28 OF THE ACT OF MAY 25, 1918, QUOTED THEREIN, BUT MORE PARTICULARLY TO THE FUNDS WHICH HAD BEEN SEGREGATED AND CREDITED TO THE INDIVIDUAL INDIANS. IN SUCH CASES THE ACCRUING INTEREST ON THE SEGREGATED FUNDS IS FOR CREDIT TO THE PRINCIPAL THEREOF AND NOT TO "INDIAN MONEYS, PROCEEDS OF LABOR.' WHERE, HOWEVER, THE CHARACTER OF THE FUNDS HAS NOT BEEN CHANGED BY BEING PLACED ON DEPOSIT WITH A BONDED BANK A SOMEWHAT DIFFERENT SITUATION IS PRESENTED, AND THE MONEY THUS DERIVED AS INTEREST MAY BE CREDITED EITHER TO THE PRINCIPAL IN THE BANK FOR THE SAME FUTURE DISPOSITION AS WILL BE MADE OF THE PRINCIPAL, OR TO THAT PART OF THE FUNDS STILL REMAINING IN THE TREASURY UNLESS BY SPECIAL LEGISLATION SPECIFICALLY APPLICABLE TO THE PARTICULAR FUND THERE IS PRESCRIBED A DIFFERENT DISPOSITION OF THE ACCRUING INTEREST IN ANY GIVEN CASE. THERE WOULD APPEAR TO BE NO AUTHORITY FOR THE CREDITING OF SUCH INTEREST TO "INDIAN MONEYS, PROCEEDS OF LABOR," EXCEPT IN CASES WHERE THE MONEYS INVOLVED AS PRINCIPAL WERE ORIGINALLY OF THE CLASS SPECIFICALLY AUTHORIZED BY LAW TO BE COVERED INTO THE TREASURY TO THE CREDIT OF THAT TRUST FUND, IN WHICH EVENT SUCH FACTS SHOULD BE SPECIFICALLY STATED WHEN REQUEST IS MADE FOR CREDITING SUCH REVENUES THEREUNDER.

IT IS NOTED FROM YOUR LETTER THAT AT THE PRESENT TIME THE ONLY TWO TRIBAL FUNDS WHICH HAVE BEEN WITHDRAWN FROM THE TREASURY AND DEPOSITED IN BONDED BANKS ARE THE RED LAKE 4 PERCENT FUND, ACT OF MAY 18, 1916, 39 STAT. 138, AND THE CHEYENNE RIVER RESERVATION 3 PERCENT FUND, ACT OF MAY 29, 1908, 35 STAT. 463 (SEE ALSO 36 STAT. 608 AND 37 STAT. 653). SINCE, AS YOU STATE, THE INDIAN OFFICE HAS ALLOTTED AND ENCUMBERED THE REVENUES DERIVED AS INTEREST FROM THESE FUNDS FOR THE FISCAL YEAR 1926 AND THAT TO ESTABLISH A DIFFERENT PROCEDURE AT THIS TIME WOULD SERIOUSLY HANDICAP THE INDIAN SERVICE, THE PRACTICE OF CREDITING SUCH INTEREST REVENUE ACCRUING UP TO JUNE 30, 1926, TO "INDIAN MONEYS, PROCEEDS OF LABOR," WILL NOT BE FURTHER QUESTIONED, IT BEING UNDERSTOOD THAT THE TOTAL AMOUNT OF EXPENDITURES THEREFROM WILL NOT EXCEED THE AMOUNTS AUTHORIZED TO BE EXPENDED FROM TRIBAL FUNDS PURSUANT TO THE PROVISIONS OF SECTION 27 OF THE ACT OF MAY 18, 1916, 39 STAT. 158.

THE INTEREST REVENUES HEREIN DISCUSSED, WHETHER DERIVED FROM MONEYS WHICH HAVE ACTUALLY BEEN SEGREGATED INTO INDIVIDUAL SHARES OR FROM MONEYS WHICH RETAIN THEIR STATUS AS TRIBAL FUNDS, ARE NOT PROCEEDS OF PASTURAGE OR SALES OF INDIAN RESERVATION PRODUCTS AND ARE, THEREFORE, NOT PROPERLY FOR CREDIT UNDER THE TRUST FUND "INDIAN MONEYS, PROCEEDS OF LABOR," WITHIN THE INTENT AND MEANING OF THE PROVISIONS OF THE ACT OF MARCH 3, 1883, 22 STAT. 590. SUCH INTEREST REVENUES ACCRUING SUBSEQUENT TO JUNE 30, 1926, MAY NOT BE CREDITED TO, NOR EXPENDED AS,"INDIAN MONEYS, PROCEEDS OF LABOR," UNLESS IN THE MEANTIME SPECIFIC LEGISLATION IS ENACTED AUTHORIZING SUCH DISPOSITION.