Pull the plug: Utah should resign as trustee of Navajo fund

It's time to pull the plug on the Navajo Trust. Utah's governor and legislative leadership are right to suggest that the state resign as trustee next July.

The Navajo Trust Fund was created by Congress in 1933. It receives 37.5 percent of oil and gas royalties from Utah Navajo Reservation lands; the balance of those royalties go to the Navajo Nation's tribal government in Window Rock, Ariz. Oil from the Aneth field has been the primary source of revenues. Congress designated Utah as trustee of the fund.

But that relationship has been rocky over the years. Though the trust has provided many worthwhile services to the Navajo people, a legislative audit in 1991 revealed that a Development Council partially funded by the trust had mismanaged its money, and a for-profit business subsidiary had lost millions of dollars.

Members of the tribe filed suit to recover losses that occurred under the state's watch between 1955 and 1991, alleging that the state could not account for most of $62 million. That lawsuit is pending.

A three-member board of trustees that includes the state treasurer and director of finance currently oversees the trust. It is empowered to appoint a trust administrator. They are advised by a Dineh Committee of tribal members nominated by Utah chapters of the tribe and appointed by the governor.

This arrangement smacks of paternalism, but that's only part of the story. Some of Utah's Navajo are reluctant to see all royalties turned over to the tribal government in Window Rock because they don't want to see Utah resources drained away by the central government to the detriment of Utah members of the tribe. The Utah Navajo are a minority faction on the nation's tribal council, and are not in a strong political position to protect their interest.

If Utah state government resigns as trustee, Congress must appoint another or devise some other solution. In the meantime, a court could act as trustee. Gov. Jon Huntsman, Congressman Jim Matheson and members of the tribe have had preliminary discussions.

With the Utah law that manages the fund set to expire July 1, the clock is ticking.