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. Last Updated: 07/27/2016

U.S., Iranians Settle Downed Plane Claims

WASHINGTON -- At a time when the United States is trying to defuse tensions with Iran, the U.S. government has announced that it will pay almost $62 million to families of 248 Iranians killed when an American warship shot down an Iran Air passenger plane over the Persian Gulf in 1988.

No money will go to the Iranian government.

The settlement announced Thursday does not signal a change in relations with Iran, said State Department spokesman Nicholas Burns.

Yet it comes as President Bill Clinton's administration, alarmed that the United States and Iran may be slipping toward some kind of collision, is sending strong signals to Tehran that it does not want any kind of showdown, according to administration officials.

The accident settlement ends a long dispute. The past three U.S. administrations claimed the action, which killed 290 people, was defensive. But the Iranian airbus was clearly a civilian flight.

Under the settlement, which came after Iran agreed to drop its case at the International Court of Justice, the United States will pay $300,000 for each wage-earner killed and $150,000 for each nonwage-earner, Burns said.

One recent cause of the deteriorating relationship between the United States and Iran came last week in Bosnia-Herzegovina, where NATO troops arrested two Iranians who appeared to be running an extremist cell.

The administration also has been "deeply disturbed'' about increasing Iranian surveillance of U.S. diplomatic personnel and facilities in the Middle East, the Balkans and Central Asia, the Pentagon official said.

Other factors have also sparked growing U.S. concern. First, Iran is expanding production of long-range missiles and chemical weapons, the Pentagon reports. Second, most of Iran's recently purchased conventional weaponry is offensive systems that could disrupt Persian Gulf shipping.

Iran is also the most active opponent of the U.S.-orchestrated Middle East peace process, U.S. officials said.