Inappropriate Use of an Indian Trust Fund To Subsidize BIA Activities

Gao ID: FGMSD-80-78 October 7, 1980

The Indian Moneys, Proceeds of Labor Trust Fund is supposed to finance the Bureau of Indian Affairs' (BIA) operation of Indian schools and agencies which should generate the trust fund's revenue. However, BIA uses the fund to support other administrative activities that are funded directly by appropriations. Contrary to law, trust fund revenue is generated from sources unrelated to authorized trust fund activities.

Although the fund should not finance BIA operating expenses, it was used for such purposes. It was also used as a revolving fund to finance activities that support BIA operations, other federal agencies, and/or private organizations. BIA officials told GAO that the trust fund was used for administrative expenses when appropriated funds ran out. By doing so, BIA used the fund to circumvent attempts by Congress to reduce BIA administrative costs. BIA appropriations accounting structure has procedures for handling reimbursements for goods and services. The trust fund is no longer needed to account for expenses and revenue of Indian agencies and schools operated by BIA.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: John F. Simonette Team: General Accounting Office: Financial and General Management Studies Division Phone: (202) 275-1581


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