loan programs

$380 million remaining in Native American Farmer Colony

SIOUX FALLS, SD — A federal judge will hear opinions Monday on what to do with $380 million left over from a settlement that sought to reimburse Native Americans who were discriminated against by the U.S. Department of Agriculture.

District Judge Emmet Sullivan received hundreds of comments, mostly from Native Americans who argue the money should be distributed in another round of payments — a move the federal government opposes.

The money comes from a 2010 settlement with the USDA. In 1999, a group of Native Americans sued the government, arguing that the USDA was discriminating against Indian farmers and ranchers who applied for loans from the department. The USDA paid $680 million and another $80 million in debt relief to settle Keepseagle vs. Vilsacka similar decision made by the department to settle other lawsuits filed by minority groups.

The settlement established a claims process for Native Americans who alleged discrimination, and it included a provision that any remaining money would be distributed to nonprofit groups that help Native American farmers and ranchers.

At the time, the parties believed that only about $1 million would be left after the claims were settled, said Joseph Sellers, the class attorney. But in the end, there were only about 3,600 successful applicants, far fewer than originally expected.

“We realized we would have a lot more money left over,” Sellers said.

Some of the claimants who received payments wanted another round of payouts. But the government resisted another round of payments because officials didn’t want Native American farmers and ranchers to receive more money than what blacks, Hispanics and other minorities were receiving in their settlements, a said Sellers.

Gwen Sparks, a USDA spokeswoman, declined to comment.

After negotiations, the government agreed to allow the remaining money to be placed in a trust. If approved, 10% would be distributed to nonprofits by an advisory board, and the remaining 90% would be distributed over the next 20 years by a foundation to nonprofits that help ranchers and Indian farmers.

In the absence of an agreement, the federal government could have demanded that the remaining money be returned, Sellers said.

But the deal is deeply unpopular with many Indians who received payments. They argue that as victims of discrimination they should recover the remaining money.

In a petition filed last month, Marilyn Keepseagle, one of the parties behind the class action lawsuit, said Native American farmers and ranchers were discriminated against, not the charities that would receive the money. Keepseagle proposed that the money either be paid out to the 3,600 successful claimants or that another claims period be opened up for Native Americans who did not file a claim the first time around.

“The ends of justice demand that this money be distributed to class members instead of providing historic and unwarranted payment to charities,” Keepseagle said in its motion.

Marshall Matz, an attorney representing Keepseagle and other Native Americans who want another payout,

predicted that no matter what, there would probably be a call.

“I don’t know why you would need a foundation – to create a foundation – to do unspecified good things when you can give money to people who can prove they’ve been damaged,” he said. Matz.

Ellis also reports for the (Sioux Falls, SD) Argus-Leader