The state has been administering more than a third of oil-and-gas royalties from the Utah portion of the Navajo Nation for the past 75 years.

But the arrangement, which even some state lawmakers concede is condescending toward the Navajo, has led to federal lawsuits alleging the state mishandled funds costing the Navajos millions. The most recent suit is pending in federal court in Salt Lake City.

"Utah has the right and the power to resign as trustee," says the Navajos' attorney Brian Barnard.

Even if the state successfully resigns as trustee, he said, it would not affect the lawsuit, which alleges Utah mismanaged the fund from 1955 to 1991. During that time, the suit contends, the state has not been able to account for most of the $62 million that flowed into the fund.

"Estimates are that had the trust fund been professionally managed, invested and used wisely, there should have been more than $100 million dollars in that fund as of 1992," Barnard said in an e-mail.

Meanwhile, the Navajo Utah Council called Tuesday's announcement "historic and monumental in tribal-state relations."

The Navajo Trust Fund was created by Congress in 1933 to hold 37 1/2 percent of the royalties from drilling in the Aneth oil fields for the benefit of tribal members living in Utah's San Juan County. The rest of the royalty money, which began coming into the fund in the late 1950s, goes to Navajo Nation headquarters in Window Rock, Ariz. Navajo Speaker Lawrence Morgan said the Navajo Nation Council would work with Utah members to retrieve the funds and help provide strict accountability.

Delegate Kenneth Maryboy, a Utah member, said that under Navajo control, "We must be judicious in spending this money."

Utah Senate President John Valentine said the Navajo and the state are in agreement about one thing at least: Both want Utah out of the Navajos' gas and oil royalty affairs.

"The Navajos are fully able to handle these royalty payments themselves," Valentine said. "We got involved because Congress told us to get involved. We are finally saying this is a no-win situation for us. We don't get anything out of it, and it's an aggravation for the Navajo."

Valentine said when the state's laws controlling the fund expire in July, the federal court will act as trustee until Congress appoints another trustee or devises a better process.

"We are committed to helping the federal government and the Navajos find a more suitable way to distribute the royalties," said Gov. Jon Huntsman Jr.

Because trust law requires a full financial accounting when a trustee resigns, Barnard said the state's action should speed resolution of the lawsuit.