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28468 PDF 2006

S. HRG. 109–579

NATIVE AMERICAN INDIAN HOUSING PROGRAMS

HEARING

BEFORE THE

COMMITTEE ON INDIAN AFFAIRS

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

ON

OVERSIGHT HEARING TO REVIEW THE NATIVE AMERICAN INDIAN

HOUSING PROGRAMS

JUNE 28, 2006

WASHINGTON, DC

(
COMMITTEE ON INDIAN AFFAIRS

JOHN McCAIN, Arizona, Chairman

BYRON L. DORGAN, North Dakota, Vice Chairman

PETE V. DOMENICI, New Mexico

CRAIG THOMAS, Wyoming

GORDON SMITH, Oregon

LISA MURKOWSKI, Alaska

MICHAEL D. CRAPO, Idaho

RICHARD BURR, North Carolina

TOM COBURN, M.D., Oklahoma

DANIEL K. INOUYE, Hawaii

KENT CONRAD, North Dakota

DANIEL K. AKAKA, Hawaii

TIM JOHNSON, South Dakota

MARIA CANTWELL, Washington

JOHN TAHSUDA, III, Majority Staff Director

SARA G. GARLAND, Minority Staff Director

(II)
(III)

C O N T E N T S

Page

Statements:

Adams, Jason, executive director, Salish and Kootenai Housing Authority ................................................................................................................... 17

Boyd, Rodger, deputy assistant secretary, Native American Programs,

Department of Housing and Urban Development ...................................... 3

Cabrera, Orlando J., assistant secretary, Office of Public and Indian

Housing, Department of Housing and Urban Development ...................... 3

Dorgan, Hon. Byron L., U.S. Senator from North Dakota, vice chairman,

Committee on Indian Affairs ....................................................................... 1

Ellis, A.D., principal chief, Muscogee Creek Nation, Okmulgee, OK ........... 16

Green, Pattye, senior business manager for Rural Native American Initiatives, Fannie Mae, Tishomingo, OK ............................................................ 5

McCain, Hon. John, U.S. Senator from Arizona, chairman, Committee

on Indian Affairs ........................................................................................... 1

Murkowski, Hon. Lisa, U.S. Senator from Alaska ......................................... 2

Shuravloff, Marty, chairman, National American Indian Housing Council,

Washington, DC ............................................................................................ 13

Steele, James Jr., chairman, Confederated Salish and Kootenai Tribes

of the Flathead Indian Nation ..................................................................... 17

APPENDIX

Prepared statements:

Cabrera, Orlando J. .......................................................................................... 25

Ellis, A.D. .......................................................................................................... 23

Green, Pattye (with attachment) ..................................................................... 43

Shuravloff, Marty ............................................................................................. 54

Steele, James Jr. (with attachment) ............................................................... 58

(1)

NATIVE AMERICAN HOUSING PROGRAMS

WEDNESDAY, JUNE 28, 2006

U.S. SENATE, COMMITTEE ON INDIAN AFFAIRS, Washington, DC.

The committee met, pursuant to notice, at 9:30 a.m. in room 485,

Senate Russell Office Building, Hon. John McCain (chairman of the

committee) presiding.

Present: Senators McCain, Dorgan, and Murkowski.

STATEMENT OF HON. JOHN MCCAIN, U.S. SENATOR FROM

ARIZONA, CHAIRMAN, COMMITTEE ON INDIAN AFFAIRS

The CHAIRMAN. Good morning. The committee will come to order.

Welcome to the oversight hearing on Indian housing. It has been

nearly 10 years since Congress first passed the Native American

Housing Assistance and Self-Determination Act. Since then, we

have seen progress in home construction and ownership. Yet the

Committee is troubled to hear that overcrowding and homelessness

still exist in Indian communities. Indeed, the president of the

NCAI reported to this committee at our budget hearing in February that in some cases, as many as 25 to 30 people were living

in homes with no more than 3 bedrooms.

As chairman of this committee, I am concerned that these conditions may have far-reaching negative impacts on other important

aspects of the lives of Indian people, such as education, economic

development, and health. Adequate housing is a fundamental need

that must be met to support improvements in these other areas.

I welcome the witnesses and look forward to their testimony.

Senator Dorgan.

STATEMENT OF HON. BYRON L. DORGAN, U.S. SENATOR FROM

NORTH DAKOTA, VICE CHAIRMAN, COMMITTEE ON INDIAN

AFFAIRS

Senator DORGAN. Mr. Chairman, first of all, thank you for calling

this hearing. I extend a welcome to our witnesses and appreciate

their being with us.

As I have indicated before, I think there is a bona fide crisis in

health care, housing and education. Today we are talking about

housing on Indian reservations. The U.S. Commission on Civil

Rights has indicated that 40 percent of the on-reservation housing

structures are substandard. That compares with 6 percent nationwide.
2

One in five reservation homes lacks complete plumbing; 90,000

Indian families are homeless or under-housed. I have toured some

housing developments on some Indian reservations that are absolutely shocking with respect to their disrepair. I have told the story

about Sarah Swifthawk who died in her house because she froze

to death in a home that didn’t have windows. They had plastic

sheeting, for windows at tempertures of 35, 40 below zero, while

sleeping on a cot. That is not America. That is not the best of what

we ought to be offering in America, to all Americans.

So we deal today with housing, housing policy, with respect to

Native Americans. We need to consider reauthorization of the Native American Housing Assistance and Self-Determination Act of

1996. This hearing will provide some very important groundwork

for those deliberations.

So Mr. Chairman, I look forward to, as always, working with you

on these issues, and thank you for conducting these hearings.

The CHAIRMAN. Thank you very much.

Our first panel is Orlando J. Cabrera, who is the assistant secretary of the Office of Public and Indian Housing, Department of

Housing and Urban Development. He is accompanied by Paula

Blunt, general deputy assistant secretary, Office of Public and Indian Housing, and Rodger Boyd, deputy assistant secretary of Native American Programs.

If they would like to come to the witness table, you are welcome

to do so. Do you want them there or not, Mr. Cabrera?

Mr. Cabrera. No, Mr. Chairman; Ms. Blunt has a medical emergency, nothing critical, and my staff is with me.

The CHAIRMAN. I am sorry to hear that, and please send our best

and our condolences to Ms. Blunt.

The CHAIRMAN. Thank you.

And Pattye Green, who is a senior business manager for Native

American Initiatives of Fannie Mae. Before I ask you to proceed,

I would ask Senator Murkowski if she has any opening comments

she would like to make.

STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM

ALASKA

Senator MURKOWSKI. Thank you, Mr. Chairman, and good morning. I appreciate your calling the hearing today and appreciate

those who have taken their time this morning to present to us.

As you know, we have some issues in my State of Alaska that

we care about a great deal. We have issues that relate to the high

cost of housing primarily caused by transportation issues, as is specific up in Barrow, which is the northernmost community in the

State. You essentially have one barge a year coming in to bring the

supplies. If you miss the barge, the only way to get it there is to

fly it hundreds and hundreds of miles, adding to the expense. So

we have some logistical issues that cause us concern.

So the NAHASDA funding is very, very critical to my State, as

well as it is to the rest of the Nation. So I am pleased that we are

seeing some increases or some improvements in there.

I also want to just mention briefly, it is not just the expenses associated with the construction of the homes, but in many of our remote Alaska Native communities, we have water and sewer condi-
3

tions that often rival third world countries. And we have great concerns with how we provide potable water, how we provide sewer facilities for those in the communities. I have talked in this committee and in others about an unsophisticated sewage system which

consists of a honey bucket, nothing more than a bucket with a toilet seat on top of it, and the disposal of the waste is walking it

down somewhere outside the community, usually in a lagoon and

dumping it there.

Federal funding for water and sewer projects in rural Alaska is

separate from NAHASDA, but I want to mention these as challenges that we deal with on a daily basis, to really underscore the

very unique challenges that we face in providing housing and related service.

I do appreciate the fact that the National American Indian Housing Council led a delegation of Congressional staffers to several of

these remote communities last year. I think it is important that we

be able to observe first-hand some of the conditions. I am thankful

that they were able to attend, and would certainly welcome any of

you to come up on a similar field trip.

Mr. Chairman, again, I appreciate your conducting the hearing,

and I look forward to the testimony of the witnesses.

The CHAIRMAN. Thank you very much.

Mr. Cabrera, please proceed. Welcome.

STATEMENT OF ORLANDO J. CABRERA, ASSISTANT SECRETARY, OFFICE OF PUBLIC AND INDIAN HOUSING,

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT,

ACCOMPANIED BY RODGER BOYD, DEPUTY ASSISTANT

SECRETARY, NATIVE AMERICAN PROGRAMS

Mr. CABRERA. Thank you, Mr. Chairman.

Mr. Chairman, Mr. Vice Chairman, and members of the committee, good morning and thank you for inviting me to comment on

HUD’s Indian Housing and Community Development programs.

My name is Orlando Cabrera, and I am HUD’s assistant secretary

for Public and Indian Housing. It is a pleasure to appear before you

again, and I wanted to express my appreciation for your continuing

efforts to improve the housing conditions of American Indian, Alaska Native, and Native Hawaiian peoples.

From HUD’s perspective, much progress is being made. Momentum needs to be sustained as we continue to work together toward

creating a better living environment throughout Indian country. At

the outset, let me reaffirm HUD’s support for the core principle of

government to government relations, with federally-recognized Indian tribes. HUD is committed to honoring this fundamental concept in our work with American Indians and Alaska Natives.

I would like to share with you my perspective on how to help

tribal communities succeed. My background is in housing, so I

would like to focus most of my tools on my profession, I should say

my former profession.

Today there are more ways to leverage Federal funds than ever

before. Tribes should look beyond HUD’s Indian Housing Block

Grant and title VI programs. All these new efforts involve some

risk, but without risk fewer families are assisted. We have engaged

in marketing and outreach activities designed to make tribes and
4

TDHEs more familiar with our programs, particularly those with

Federal guarantees to lower the risks that have traditionally made

the private sector shy away from partnering with tribes.

We are also examining a bond financing initiative that has

worked well for public housing authorities, to see if it can do the

same for tribes. Another way we seek to help is by encouraging

TDHEs to leverage private sector capital to create more housing on

reservations.

President Bush and Secretary Jackson have made their commitment to home ownership clear. Home ownership and the ability to

build equity in one’s home is an important component in the development of strong tribal communities for generations to come.

Creating home ownership opportunities continues to rank at the

top of the Administration’s priorities for the American people. And

nowhere is this more important than in the Native American community.

HUD section 184, Indian Housing Loan Guarantee program, has

made a significant contribution to the overall success of the Administration’s home ownership initiatives. Section 184 activity for the

past fiscal year shows that tribes and TDHEs are using this program with increasing frequency. In total, HUD has completed $380

million in loan guarantees through the inception of the 184 program.

During the first 8 months of fiscal year 2006, HUD approved 804

loans, obligating $123.8 million, representing a 400-percent increase in volume since 2001. The rate of loan obligations, which we

estimate to reach $180 million to $200 million by the end of the

fiscal year, for this fiscal year, confirms that the section 184 program is bringing home ownership to more and more tribal members at very little cost to the Federal taxpayer.

When I think of leveraging, the word collaboration comes to

mind. NAHASDA’s Indian Housing Block Grant program continues

to be the largest single source of housing capital in Indian country.

The IHBG program, which came online at the beginning of the fiscal year 1998, has now distributed over $5.7 billion in funding to

tribes or their TDHEs.

But relying on IHBG funding alone without leveraging those dollars misses a significant opportunity. We are committed to exploring new ways to combine HUD resources with those of other Federal agencies, the States and the private sector.

In a combined effort to increase the home ownership rate in Indian country, address affordable housing needs and promote mortgage financing, PIH’s former assistant secretary, BIA’s assistant

secretary and USDA’s rural development acting under secretary

signed a memorandum of understanding to work together with

tribes to provide housing development and related assistance to all

sectors of the Native American community. A major aim of the

memorandum of understanding, which was signed in September of

2004, was to obtain a commitment from the BIA to expedite the

production of title status reports, or TSRs, a necessary document

for mortgaging of trust or restricted Indian lands.

Despite these advances, the TSR approval process is not where

we want it to be. In an effort to reach our common goals, I am
5

meeting tomorrow with Interior Deputy Associate Secretary Cason

to determine if there is more that we can do together.

Land assignment law is a big issue for us. In an effort to use the

government to government relationship collaboratively and to increase the private sector housing market presence on reservations,

ONAP and the BIA have worked with the Mashantucket-Pequot

Tribe to establish a tribal land assignment law. Interior’s Solicitor’s

office has approved the process and issued an opinion that individual assignments governed by tribal land assignment law do not require BIA approval or recordation. ONAP will issue program guidance on land assignments for the section 184 program in the coming months, and we expect other tribes to take advantage of this

process.

This concludes my prepare remarks. Again, thank you for your

time. Thank you for allowing me to testify. Again, I encourage the

active participation of all tribes to share innovative approaches to

housing development in Indian country.

I would be happy to answer any questions that you may have.

[Prepared statement of Mr. Cabrera appears in appendix.]

The CHAIRMAN. Thank you very much.

Ms. Green, welcome.

STATEMENT OF PATTYE GREEN, SENIOR BUSINESS MANAGER

FOR RURAL NATIVE AMERICAN INITIATIVES, FANNIE MAE,

TISHOMINGO, OK

Ms. GREEN. Thank you, Chairman McCain, Vice Chairman Dorgan and members of the committee. My name is Pattye Green, and

I am the senior business manager for Rural Native American Initiatives with Fannie Mae, and I have over 28 years of mortgage

lending experience. Prior to coming to Fannie Mae, I was the home

finance director of the Housing Authority of the Choctaw Nation of

Oklahoma, and I am a member of the Choctaw Nation of Oklahoma.

I am pleased to be here today to discuss the barriers to capital

access that we see on tribal lands and to share with you the steps

that Fannie Mae is taking to help overcome those barriers, expand

home ownership and affordable housing for rental opportunities in

tribal communities. Fannie Mae’s Congressionally granted mission,

to create affordable housing opportunities for Native American

families living on tribal lands, is one of the toughest challenges we

face. According to the National American Indian Housing Council,

we have seen some improvement, but we still see homes on tribal

lands that are overcrowded, that are not connected to public sewer

systems, lack indoor plumbing. Almost one-half of Indian households pay more than 30 percent of their income for housing expenses, compared to 23 percent of all households in the United

States.

The home ownership rate on reservations are 41 percent and

stated by NAIHC, is 33 percent, well below the national average

of approximately 68 percent. An absence of conventional mortgage

lending is a major factor behind the gap. The most stubborn and

overwhelming barrier to capital access in Indian country is a lack

of economic opportunity. Poverty rates are 26 percent for Native

Americans, over double the national average of 12 percent.
6

In Navajo country, 43 percent of people live below the poverty level. The average per capita income is $7,300 and the unemployment rate reaches almost 25 percent.

In light of these severe socio-economic conditions, Fannie Mae is

taking a three-pronged approach to expanding affordable housing

on tribal lands. First, by developing the right mortgage products

that make it easier for our lender partners to do business on the

tribal lands. Second, by working with developers and tribal housing

authorities to address the critical shortage of affordable housing

units that currently exist. And finally, to develop broad partnership

throughout the housing finance and tribal communities to focus on

the long-term, systematic barriers to housing and community development that exists in Indian country today.

One of the groups that is important to this effort is the National

American Indian Housing Council. We would like to encourage you

to continue Congressional funding to this group. Against this backdrop of extreme poverty, it is not surprising that the Native American home ownership rate lags far behind the national rate, and

that Native Americans are pessimistic about the lending process.

A 2000 survey by the Treasury Department found that 65 percent of tribal members viewed conventional home mortgages as difficult or very difficult to obtain. Fannie Mae has customized its

suites of community lending products to respond to the unique

needs of Native American communities. Our community lending

products are designed to help borrowers overcome the two primary

barriers to home ownership: Lack of down payment funds and

qualifying income, through lower cash requirements for down payment and closing, reduced qualifying income requirements and

higher acceptable debt to income and loan to value ratios that are

required for traditional, conventional mortgages.

We have worked with tribes to add unique features to this product, including tribally provided home buyer eduction, down payment assistance programs and intervention programs for borrowers

who get into trouble. We work with each individual tribe to understand their culture and to help them to understand the needs that

they have and to customize programs that are necessary for their

tribes.

We currently have relationships with 112 lenders to make loans

to Native Americans on tribal lands. Since 2001, Fannie Mae has

helped our lender partners serve over 8,535 Native American families by providing more than $839 million in affordable mortgage financing on tribal lands.

Perhaps the most serious challenge to affordable housing in the

near term is the critical shortage of affordable housing on tribal

lands. According to the National American Indian Housing Council,

there is an immediate shortage of 200,000 units on tribal lands.

The Navajo Housing Authority estimates that it alone needs 21,000

new housing units to satisfy the unmet needs of all Navajo families, including 12,000 new homes for purchase.

Fannie Mae has worked closely with tribes and other housing

partners, such as the Blackfeet Reservation in Montana, the Standing Rock Reservation in South and North Dakota, both with the

construction of new units and rehabilitation of existing units

through investments in low income housing tax credit investments,
7

collateralized revenue bonds and HUD-guaranteed Native American Housing Assistance and Self-Determination Title VI loans. We

have also begun to provide tribal housing authorities with additional financing via our community lending business channel to

help bridge funding gaps through the construction phase of their

development.

Nationwide, we have invested over $160 million in low income

housing tax credits. We have helped with over $51 million in title

VI loans and $1.5 million in additional financing to support construction and rehabilitation units in tribal land since 2001.

Finally, financial experience poses a barrier to capital access for

Native Americans. Many Native Americans do not have banking

relationships, and in many Native American economies, financial

transactions have long been conducted in cash. As a result, many

Native Americans have little regular familiarity with banking,

credit reporting and the loan qualification process and standards.

And unsurprisingly, they have difficulty obtaining credit through

traditional means.

In 2002, the conventional loan denial rate for Native Americans

was 23 percent. The lack of experience and familiarity with bank

practices and products also leaves many Native American communities vulnerable to unscrupulous financial practices that undermine communities. In 2003, 53 respondents believed that lenders

based on race and identified predatory lending and that is why

they were being denied.

Lastly, Mr. Chairman, I would like to briefly mention our own

efforts to institutionalize our commitment to Native American

housing issues. In January of this year, Fannie Mae created a new

business unit that focuses on addressing the toughest housing challenges in our distressed urban areas, rural communities and tribal

lands. In addition to supporting our business units, as they seek

to make investments in these areas, we are also developing targeted, place-based strategies to create long-term solutions that are

both transformative and scaleable.

Ultimately, our goal is not to just make investments in shortterm, but also to play a meaningful role in transforming these distressed areas into healthy and vibrant markets where access to private capital is indistinguishable from other, more established areas

of the United States. I hope that with these comments, Fannie Mae

has begun to make progress in expanding home ownership for Native Americans. But it is important to recognize that we have so

much more to do, and we will continue to listen closely to Indian

country leaders to build long-term partnerships and to address the

tough housing and economic challenges facing Native American

communities today.

Thank you and I would be happy to answer any questions.

[Prepared statement of Ms. Green appears in appendix.]

The CHAIRMAN. Thank you very much.

Secretary Cabrera, I understand you recently notified tribal leaders that HUD will not process any further fiscal year 2006 Indian

Housing Block Grant awards until a stay is ordered in the Fort

Peck Housing Authority v. HUD case, wherein the court ordered

HUD to take such action necessary to include certain housing units
8

in determining funding formulas for only Fort Peck. What is the

impact of not processing these awards?

Mr. CABRERA. The impact is that currently there are no awards,

no money going to any of the tribes until one of two things happen.

I think the second is more likely than the first.

The first is to get a stay from a Federal judge in Colorado, which

we suspect we probably would not get, at least that is what our

legal counsel is telling us. The second is to come to essentially a

stipulation with the plaintiff in this case, Fort Peck, in which case

that would give us the room that we would need to go ahead and

allocate. We believe that is a more likely outcome. We certainly

hope it is a more likely outcome.

Yesterday afternoon, I received word that they are close but not

perfectly aligned and most of the issue has to do with a commitment that HUD was asked to make with respect to 2007 appropriation that we cannot, because it would essentially infringe upon this

prerogative, which is the budget. I think that can be bridged. So

my sense of life is we are closer than not.

The CHAIRMAN. Well, I am not sure that if you agree to request

certain funds from the Congress that that would be an infringement upon our prerogatives. There is no budget that is submitted

that is not subject to the review or modification by the Congress.

Mr. CABRERA. No; I am sorry, Mr. Chairman, I wasn’t clear. This

isn’t about an amount of money. What they were asking us to do

was essentially commit to an amount of money in the context of a

legal settlement where we can, certainly we can preface it, and I

believe that is what our lawyers are going to do, they are going to

do precisely what you have just recommended, which is to say, if

Congress approves something, then great. But we can’t have a

breached settlement by virtue of it being a predicate to the settlement.

The CHAIRMAN. How many tribes or housing entities are being

affected by this?

Mr. CABRERA. As I recall, all 561.

The CHAIRMAN. Whew. It seems to me that would lend some urgency to resolving this situation.

Mr. CABRERA. Very much so. I would love to resolve this situation.

The CHAIRMAN. What kind of help are you getting?

Mr. CABRERA. We have, our legal counsel and the Department of

Justice are working very intently with Fort Peck’s counsel in order

to come to some resolution.

The CHAIRMAN. How much money are we talking about here in

the Fort Peck situation?

Mr. CABRERA. Mr. Chairman, may I please consult with my staff?

The CHAIRMAN. Yes; sure. Roughly.

If your staff would just like——

Mr. CABRERA. It is okay, I am sorry. It is $400,000. And I believe

there are a few other tribes, one that comes to mind is Arapaho,

that also agrees with Fort Peck’s position on this. I don’t recall

what that number is.

The CHAIRMAN. You are talking about $400,000?

Mr. CABRERA. Yes.

The CHAIRMAN. Holding up hundreds of millions of dollars?
9

Mr. CABRERA. Yes; because the issue is the way that the formula

grant is administered. So by virtue of undertaking the lawsuit and

getting this particular order, that is the regrettable precise effect.

The CHAIRMAN. Senator Dorgan.

Senator DORGAN. Mr. Chairman, let me also ask the same line

of questions. You would not be required to hold up funding to other

tribes. I am sure because this deals with Fort Peck and a decision

with respect to Fort Peck. I understand that you may have to recalculate the funds. But you could assume, create reserves that would

allow you to do that at some point, such as reserve a body of funds

and at least distribute some portion of the housing funds, could you

not?

Mr. CABRERA. As I understand it from our legal counsel, the very

incomplete answer to that is no. And the reason is because of the

nature of the formula distribution inside of the appropriation. I remember actually expressly asking that question, and the answer

was that this particular order throws the entire formula into question.

Senator DORGAN. Tell me the quantity that is now frozen? Do

you know off-hand?

Mr. CABRERA. Mr. Vice Chairman, may I again consult with my

staff?

Senator DORGAN. Yes; please.

Mr. CABRERA. Thank you. Approximately $300 million.

Senator DORGAN. You know, I don’t understand the answer you

have received from lawyers, nor why you would accept that answer.

A $400,000 discrepancy issue here is holding up in, did you say in,

did you say $300 million?

Mr. CABRERA. Yes.

Senator DORGAN. In a $300-million pool of money, you are certainly able to reconcile whatever is judged to be done to recalculate

that formula within the context of a portion of that $300 million.

But there is no reason at all to be holding up all of the housing

money in anticipation of having to find an answer here. You certainly could be moving some of that housing money out now. Are

you saying you are prevented by your attorneys from doing that?

Mr. CABRERA. No; I am saying that our attorneys are counseling

that based upon this particular Federal judge’s order, that if we

did, we would be in contravention of the order. And more to the

point, the issue, and I respect that, I respect the idea that proportionally, the $400,000 in terms of the relative amount, the

$400,000, no, the $300 million, it appears very small.

The issue isn’t the money. The issue is the formula.

Senator DORGAN. I understand.

Mr. CABRERA. And this particular order basically said, the entire

administrative mechanism that you are using is invalid.

Senator DORGAN. I understand all of that. But do you think the

judge would have anticipated that you should hold up all of the

funding going out for housing in order to reconcile the $400,000?

Mr. CABRERA. Forgive me, I didn’t mean to interrupt.

I think what the judge thought was that this was just a Fort

Peck issue. And so I don’t think that, I think that is why we have

some hope on this day, but we are not certain on this day, and that
10

is because I am not entirely sure the judge was aware that it would

affect basically the other 560 tribes. That is why we are seeking

the stay and that is why we would like to resolve this.

Senator DORGAN. But do you agree it would minimally affect

most of the other tribes?

Mr. CABRERA. No; in some cases it is a significant effect. As I recall, there is a significant effect to both the Cherokee and the Navajo Tribe.

Senator DORGAN. How many tribes do we have in this country

that are eligible for housing funds?

Mr. CABRERA. 561.

Senator DORGAN. So you are saying that three of them would be

affected?

Mr. CABRERA. No; those are the only ones that I remember.

Senator DORGAN. Oh, all of them because of the formula distribution?

Mr. CABRERA. Yes; it would basically redistribute the way the

formula is undertaken.

Senator DORGAN. What if you don’t get this resolved in the coming days or weeks? You just hold up all the housing funds for Native Americans for the rest of the year?

Mr. CABRERA. No; I think what I would ask, or I have asked our

lawyers to do is visit the idea of asking the judge for greater clarity

with respect to how it is he would have us proceed.

Senator DORGAN. Why hasn’t that been done already?

Mr. CABRERA. I believe it has. I believe that effort has begun.

Senator DORGAN. How has the judge responded?

Mr. CABRERA. I don’t know. That I don’t know as of today. I believe the other major effort really has been to have the parties deal

with it and then go to the judge and say, look, we agree, we can

proceed.

Senator DORGAN. You know, I bet these lawyers that are giving

you this advice are pretty well housed. So the issue here is the urgency to get housing money to Native Americans. And we have authorized and appropriated funding for housing. I am not trying to

badger you here. I think you have gotten some bad advice from

some place. And I think there must be room administratively to

continue a program, especially a program that responds to an urgent need, even if you probably hold a reserve back to recalculate

this formula at some point.

I can’t believe the judge would render a decision that says, okay,

in order to resolve this, you need to hold up all the housing funds

nationally. I can’t believe that would be the intent of the Federal

court.

Mr. CABRERA. No; and that is what I was trying to say earlier,

maybe I didn’t say it as perfectly as I should have. We believe that

the judge’s order focused on these two particular parties, and that

is why we want to revisit the issue of the order with the judge.

We are working on a separate and equivalent track to deal with

it within the parties themselves. We are hopeful that that would

happen. But certainly we are trying to resolve this issue. Once we

get clarity, as I noted earlier, we would very much like to proceed.

Our issue is not feeling comfortable with what or how the order ap-
11

proaches the entire formula issue. It only deals really with Fort

Peck.

And at the same time, maybe, hopefully, probably, Fort Peck and

HUD would come to some agreement on how to proceed in the interim, so that we can go ahead and move. In either case, we are

moving quickly.

Senator DORGAN. Mr. Cabrera, I confess I don’t understand the

formula or perhaps the nuances of the judge’s order. But I do know

that the housing funds that we have provided have now been shut

off for a month. Indian leaders are very concerned about that, and

should be, because they are, in their Government, trying to develop

housing programs to deal with a very serious problem. One only

needs to look at some of the housing stock that exists to see how

much disrepair there is, and then understand how many people

need housing and don’t have access to it.

So I hope you will understand the urgency of this and I hope that

the agency will go back to those lawyers who have told you that

you have to hold it all up. I can’t conceive that would be the case.

I hope you will report back on a weekly basis to this committee.

My hope is the first weekly report will be to say that we have resolved this and we have gotten the money out there and are starting to build housing stock.

Mr. CABRERA. Mr. Vice Chairman, if that report would come this

afternoon, nobody would be happier than me. I would like to resolve this. I have an enormous amount of empathy for the situation. But at the end of the day, we are moving steadfastly to resolve this. And I will be happy to report weekly on this. I deal with

Fort Peck or the Fort Peck situation if not every day, then very

nearly every other day. So we are moving diligently to resolve this

in the best legal way possible.

Senator DORGAN. Ms. Green, just briefly, Mr. Chairman, Ms.

Green, thank you for your testimony. I know that you have a program you have been doing with respect to North and South Dakota

at the Standing Rock Reservation.

Ms. GREEN. Yes.

Senator DORGAN. Could you just give us a very brief description

of that program and your results?

Ms. GREEN. Yes; at the Standing Rock Reservation is one of what

we are calling our deep dives, where we are going into the reservations and bringing in all of our parts of Fannie Mae, where we do

single family projects. We are doing low income housing, bringing

in multi-family, bringing in bridge loans, whatever we can do to

help the reservations to bring in whatever they need to transform

their reservations, any type of housing needs.

Standing Rock is a great example of what we are doing there.

For example, we have done low income housing tax credits, we

have done a single family project there. For instance, we have done

248 units on Standing Rock Reservation, affordable rental housing

in the past 5 years. That has been a great, great project that we

are doing there. We are there for a long term, we are not just going

in and doing a one time project. We are there for 10 years, 20

years, whatever they need us for. So we go back every year and do

an update.
12

Our CBC there is working on an ongoing basis with Standing

Rock. We have done grants, we give them grants for revolving loan

projects, whatever it is that they need to do. But as of date, we

have helped them, investing with the 248 rental projects that they

have got going there.

Senator DORGAN. Thank you very much, Ms. Green.

Mr. Cabrera, thank you for being with us today as well.

Mr. CABRERA. Thank you, Senator.

The CHAIRMAN. Senator Murkowski.

Senator MURKOWSKI. Thank you, Mr. Chairman.

I just want to follow up very briefly on the comments made by

my colleagues about the litigation and the status of it. I think it

has been made clear the urgency to this. I guess I am somewhat

surprised that perhaps the judge is not aware of the ramifications,

potentially, to all of these tribes, 500 some odd tribes out there. I

would certainly hope that that clarification is made very, very

quickly.

Just one quick question for you, Mr. Cabrera. I wanted to ask

you about the Indian housing, the cost study, which is already underway, a study that is certainly going to have a long-term effect

on the allocation of Indian housing nationwide. We are a little bit

concerned, from Alaska’s perspective. Because if the housing study

goes in a way that unfortunately we feel it might, it could have a

very negative impact to the housing authorities in the State of

Alaska. As I mentioned in my opening statement, we have some

unique challenges that we face when it comes to construction of

housing in the State. And so it is very important for HUD to be

taking a look at this very wide cross-section of data from the various housing authorities in the State.

We also recognize that it is very important from the national perspective to be getting a wide cross-section of data. Recognizing that

compilation of all this can take some time, has there been any

thought given to allocating additional time to complete the study,

to ensure that the study is going to be very complete, accurate and

fair?

Mr. CABRERA. Yes; as I recall, it was already extended by another 6 months. Further, Senator, I think that we have had the

University of Illinois Urban Center working very closely with Blake

Azama, as I recall, and other corporations or corporation representatives in Alaska on this issue. So I believe that there has been

progress. I understand precisely how seriously you take the issue.

Senator MURKOWSKI. Well, we understand that you are looking

to come up to the State some time in August, so hopefully we

would have an opportunity to talk with you a little bit more about

the issue and to give you the first-hand tour of some of the issues.

We appreciate your willingness to come up.

Mr. CABRERA. I look forward to it, thank you.

Senator MURKOWSKI. Thank you.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you very much.

Mr. Cabrera, we will be trying to get involved in this, because

we think that it needs to be resolved quickly. We are going to begin

by, Senator Dorgan and I, and other members of the committee,

sending a letter to the Secretary saying we want his personal in-
13

volvement in this. We can’t hold up housing for 500 tribes because

of a $400,000-dispute.

And I understand it is more complicated than that. I fully understand that. It is a policy problem. But we just can’t do that. We

owe more than that to Native Americans.

So we are going to start out with a letter, and then we are going

to have to maybe look at something legislatively or something, I

don’t know exactly what, but we need to explore all the options to

get this issue resolved quickly. I hope you will join us in that effort.

Mr. CABRERA. Mr. Chairman, absolutely. I would say this is not

relating to the letter, but with respect to the legislation. I think

that by the time this gets resolved, either in the context of getting

a clarified order or getting an arrangement with Fort Peck, whatever that might be, that will probably preempt any need for legislation. This is not an unreasonable judge, this is someone whom most

practicing lawyers respect greatly, including me.

So I think at the end of the day this will probably work out. I

know in the interim it is painful, not the least of which for me. I

just wanted to make sure you were aware, I will report weekly

going forward.

Senator DORGAN. Could I, Mr. Chairman, say, and I can’t speak

for the Chairman, I don’t believe there ought to be an interim. In

the interim, there should not be a shut-off of funds. These are critically needed funds for housing and we can recalculate or you can

recalculate some sort of reserve to deal with this formula issue. But

the funding should not have been shut off to hundreds of tribes.

Mr. CABRERA. I understand.

The CHAIRMAN. And unfortunately, probably is not good enough.

So we urge you to act as quickly as possible, and we will be paying

close attention. I thank you very much. Thank the witnesses.

Our next panel is Marty Shuravloff, who is the chairman of the

National American Indian Housing Council; A.D. Ellis, principal

chief of the Muscogee Creek Nation; and James Steele, who is the

chairman of the Confederated Salish and Kootenai Tribes of the

Flathead Reservation, and Mr. Steele is accompanied by Jason

Adams, who is the executive director of the Housing Authority.

Mr. Shuravloff, am I pronouncing your name correctly?

Mr. SHURAVLOFF. You are, Mr. Chairman.

The CHAIRMAN. Thank you. Please proceed.

STATEMENT OF MARTY SHURAVLOFF, CHAIRMAN, NATIONAL

AMERICAN INDIAN HOUSING COUNCIL, WASHINGTON, DC

Mr. SHURAVLOFF. Good morning, Chairman McCain, Vice Chairman Dorgan, Senator Murkowski and distinguished members of

the Senate Committee on Indian Affairs.

My name is Marty Shuravloff, and I am honored to appear before

you today as the recently elected chair of the National American

Indian Housing Council, the oldest and largest Indian housing organization in the Nation, representing the housing interests of

more than 460 tribes. I am an enrolled member of the Village of

Leisnol and also serve as the executive director of the Kodiak Island Housing Authority.

Now in its 32d year, the NAIHC is the major capacity building

organization providing guidance, technical assistance, training and
14

other services. NAIHC trains thousands of Indian housing and

other staff per year, offering most of its training for free. NAIHC

also uses state of the art technology to save tribes time and travel

costs, by offering training by webcast and video. In addition,

NAIHC provides scholarships that help offset travel costs, ensuring

that the poorest tribes receive training. In 2005, 200 different

tribes and TDHEs benefitted from 751 scholarships granted by

NAIHC.

For 32 years, NAIHC has provided invaluable assistance to Indian tribes and TDHEs, and in no small way has made the difficult

implementation phase of NAHASDA a success. Along the way,

NAIHC has endured many difficulties, including a Federal housing

agency that may, due to paternalistic tendencies, create the opposite of self-determination. Additionally, NAIHC has dealt with Congressional appropriators who are unaware of, or worse, unmoved

by, the dire economic conditions that characterize Native communities.

The impact of Federal funding for the Native American block

grant has been steadily eroded by inflation. It has gone from $600

million in 1998 to $624 million this fiscal year, an actual decline

when adjusted for inflation. During the same time, Federal funding

made available to the NAIHC for technical assistance and training

to Indian tribes and their TDHEs has also declined, threatening its

very existence.

The Department of Housing and Urban Development maintains

that NAIHC has undisbursed funds left over from fiscal year 2004

and 2005, and unobligated funds left over from fiscal year 2006

that somehow NAIHC is unable or unwilling to spend. The truth

of the matter is that NAIHC expends funds on a reimbursement

schedule and what HUD says is in the pipeline has been expended

but not yet billed to HUD as of March 2006.

If NAIHC continues to expend funds at the same rate as in 2005,

the pipeline funds will be completely gone by February 2007. The

erroneous perceptions have been caused by the many administrative delays in NAIHC’s work contract with HUD. NAIHC receives

its funds on a reimbursement basis, after incurring costs for HUDapproved activities. NAIHC’s current contract with HUD took

months to complete. While HUD shows these funds as unused,

NAIHC can show that the funds will be exhausted by the work of

the NAIHC throughout the year.

If House-passed levels of technical assistance funding prevail,

NAIHC shuts down. It is that simple. For fiscal year 2007, the

House has proposed $990,000 for technical assistance and training

services for NAIHC. And it is no exaggeration to say that with this

or a similar level of funding in the next fiscal year, NAIHC will

close its doors in or around January 2007. We hope this committee

will not let this happen.

Under the leadership of Senator McCain, NAHASDA was created

and rests on a firm foundation of Indian self-determination, reflecting the time tested principles of local tribal decision making and

tribal economic self-sufficiency. That means that Indian tribes

themselves, not HUD, design, implement and conduct housing and

related programs for their members.
15

In passing NAHASDA, Congress intended HUD’s role to be minimally intrusive. NAIHC, tribes and TDHEs have established a legislative working group to identify and address legislative and regulatory issues of tribal concern with the statute as it now stands.

Their issues include the impediments of the program assessment

rating tool process and how to improve the data collection and reporting elements.

The severe problem with methamphetamine in Indian communities, the insufficient or non-existent infrastructure in Indian communities, addressing the problem of mold in federally-assisted tribal homes, the establishing of development reserve accounts as an

eligible activity under NAHASDA, replacing the 30 percent income

rule with fair market rents, Federal procurement issues related to

housing materials, the elimination of Secretarial approval for longterm leases, and overdue and necessary reforms to the Bureau of

Indian Affairs tribal status report process.

NAIHC is committed to finding resolutions to these problems. To

address the infrastructure deficiencies in Indian country, NAIHC is

collaborating with Federal agencies in the development of an infrastructure memorandum of understanding that will encourage agencies to assist tribes with infrastructure development. Additionally,

NAIHC has established two internal working groups to deal with

issues related to NAHASDA reauthorization and the formula allocation.

The Native American Block Grant program is the main program

for funding tribal housing under NAHASDA. Historically, decennial

census numbers have been one element in the calculation of distribution of Native American housing block grant funds. A change

in the census collection technique in the 2000 census led to a

change in distribution patterns, causing a question to be raised regarding the use of a specific set of census data.

A failure of the negotiated rulemaking committee to arrive at a

consensus on which census data to use caused HUD to use a data

set that has led to a disagreement among tribes concerning the formula. To help resolve this issue, NAIHC has established a task

force with the goal of arriving at a position that is agreeable to all

tribes regarding the accounting of American Indian and Alaska Natives in the formula.

And finally, Mr. Chairman, members of the committee, NAIHC

also is gravely concerned about HUD’s recent decision to potentially withhold allocation of the remaining fiscal year 2006 funds

if the Department is unable to obtain a stay pending appeal of the

court’s decision in the Fort Peck Housing Authority v. U.S. Department of Housing and Urban Development. While we understand the

difficulties presented by the Fort Peck decision, this decision could

cause severe hardships on recipients whose funding may be inappropriately withheld.

As you are aware, most tribal and TDHE recipients are dependent on such funding to continue operating and providing services

to their low income members. Such disruption in funding could

lead to some completely shutting down.

Additionally, many tribes have pledged their Native American

Housing Block Grant funds as security for title VI or section 184

loans, and HUD’s proposed course of action could result in default
16

on these loans, requiring the United States to assume the payment

of these loans. NAIHC urges this committee to persuade HUD to

reconsider its decision and seek an alternative solution, if at all

possible.

In conclusion, I would like to thank you for giving us this opportunity to speak. We look forward to working with the committee on

all issues affecting Indian housing programs.

[Prepared statement of Mr. Shuravloff appears in appendix.]

The CHAIRMAN. Thank you.

Chief Ellis.

STATEMENT OF A.D. ELLIS, PRINCIPAL CHIEF, MUSCOGEE

CREEK NATION, OKMULGEE, OK

Mr. ELLIS. Good morning, Mr. Chairman, distinguished committee. It is a great honor to be invited here this morning to represent

my nation.

My name is A.D. Ellis, I am presently principal chief of the

Muscogee Creek Nation, the fourth largest tribe in America, with

over 62,000 members. Our housing program has basically been a

successful program. We now have over 100 employees in our housing division. Since 1970, we have built 2,900 homes, 240 low rent

apartments and the biggest thing that has helped the tribe was the

initiation of NAHASDA.

Before that, I heard the Vice Chairman mention reservations.

The misconception is all Federal funding goes to reservation tribes.

The distinction of the Oklahoma tribes is different. Out of the 39

tribes in Oklahoma, 38 of them do not have reservations.

All the housing authorities in Oklahoma fall under State of Oklahoma law. All the Housing Authority employees, the board of directors and funds, up until NAHASDA, was submitted to the Housing

Authority. In the last 3 years I came into office, I petitioned the

State of Oklahoma to exercise the sovereignty of the Muscogee Nation. We got the Senate and House of Representative to agree. In

March of this year, the Governor signed a bill relinquishing all

State housing laws and assets to the Muscogee Nation. We received

$43 million in assets and cash and the State of Oklahoma no

longer exists in the Creek Housing Authority.

Now, the Housing Authority is run by tribal government, totally

tribal government, no interference. We know what our people need.

We live among them. I received a HUD home in 1988. I waited 6

years to get the house. I ran into all the roadblocks. I know what

the people need, I know what they go through in trying to get

these.

Since the NAHASDA program was initiated, in the last two

years we have gone from tribal boundaries to statewide mortgage

assistance program. At the present time, we purchase modular

homes from an Oklahoma prison system at a great reduction in

price.

In Oklahoma, most of our people are under one-quarter blood.

Out of our 62,000 people, about 42,000 are less than one-quarter.

So what we call the full-blood people are very reluctant to ask for

anything. We put them first choice, referencing the elderly. We use

proceeds of sale that the State turned over to us for emergency

next-day assistance.
17

We now build homes on restricted lands. We are purchasing a

building company to build our own modular homes. And I didn’t

bring my housing director with me today due to budget sessions,

but I assure you, I am not an expert in housing, I only control the

housing.

But he did say that we oppose the voting that the housing council took in Hawaii previously on the using the census of the count

of tribal members. I think if it passes, I think the Navajo Nation

will probably accumulate another 7 million. The tribes in Oklahoma will probably lose about 15 million. So we are going to address that a little later.

Again, Mr. Chairman, I appreciate being here on behalf of the

Oklahoma tribes. Thank you, sir.

[Prepared statement of Mr. Ellis appears in appendix.]

The CHAIRMAN. Thank you very much, Chief.

Chairman Steele, welcome.

STATEMENT OF JAMES STEELE, JR., CHAIRMAN, CONFEDERATED SALISH AND KOOTENAI TRIBES OF THE FLATHEAD

INDIAN NATION, ACCOMPANIED BY JASON ADAMS, EXECUTIVE DIRECTOR, HOUSING AUTHORITY

Mr. STEELE. Good morning. I would like to greet you in the language of the Salish and Kootenai Tribes. [Greeting in native

tongue.]

Good morning, Chairman McCain, Vice Chairman Dorgan, Senator Murkowski, and members of the committee. My name is

James Steele. I am the chairman of the Confederated Salish and

Kootenai Tribes of the Flathead Indian Nation in present day western Montana. I appreciate the opportunity to speak before you

today. With me here today is Jason Adams, executive director of

the Salish and Kootenai Housing Authority.

I have submitted a detailed written statement and will now summarize my remarks.

The Confederated Salish and Kootenai Tribes are one of the

original 10 self-governance tribes in the United States, and we are

the only tribes in the country to operate both our IAM program and

our title plant. We were the first tribe in the country to organize

under the Indian Reorganization Act.

My testimony discusses two interesting things we are doing on

the reservation involving the issuance of private mortgages by utilizing the HUD 184 program. Our housing authority has partnered

with several of the local lenders on the Flathead Reservation to

provide this home ownership program to our membership. We have

over 80 mortgages that have been completed, with the majority of

those loans being on trust land.

In all of the transactions, the tribal council placed our housing

authority in a position of essentially an additional guarantor over

and above HUD’s guarantee. We are also quite proud of our home

buyer education program. In the last year, we have had over 80

families graduate from the classes with 56 of those families going

on to obtain a mortgage through either the HUD 184 program or

our own tribal credit program.

The housing issues that I would like to touch on today are the

Native American Housing Assistance and Self-Determination Act
18

reauthorization, the NAHASDA funding formula and funding levels

for fiscal year 2007, the funding level for the National American Indian Housing Council and the issue of HUD freezing NAHASDA

funds to recipients that have not received their fiscal year 2006

funds.

When you reauthorize NAHASDA, it is important that you address the 30 percent rule. The 30 percent rule is a mandate in the

act that requires all tenants in units supported by NAHASDA

funds to have to pay no more than 30 percent of their adjusted income in rent. The intent behind this rule may have been admirable, but as cited in my testimony, is simply not working, in great

part because it is too rigid. Our position is that our tribes could

benefit from discretion in this regard, and that we could design and

implement a rental fee schedule that provides an incentive to those

who have lived in poverty historically and who then go on to work.

From a tribal leader’s perspective, the problem is that the rule

doesn’t allow us to self-determine the structure of the housing program that we provide. We think that the assistant secretary of

HUD erred in 2003 when he arbitrarily changed the use of census

data from the single race data set to the multi-race data set. As

I understand, this decision was made without consulting with

tribes and without giving tribes the opportunity to provide input

back to HUD on the effects that such a decision would have to the

recipients of NAHASDA.

I am encouraged by the work that has begun at NAIHC to work

within its membership to convene a task force to study this issue

and work toward common ground with its membership to find an

answer to this issue. I believe that when tribes come to the table

with the expectation for solving an issue themselves, it will happen.

I would ask this committee to assist the NAIHC with the proposal that comes forth from the task force. The funding level for

NAHASDA is totally inadequate. I would ask that this committee

support a substantial increase in the fiscal year 2007 appropriation

far above what the President’s budget proposal contains.

If funding levels from fiscal year 2002 had been maintained with

modest inflation, the fiscal year 2007 appropriation for NAHASDA

should be approximately $748 million, not $625 million as contained in the President’s budget. Without some increase in funding,

housing authorities and many others are forced to make tough decisions on cutting programs, decreasing the level of maintenance of

existing units and not being able to leverage funding to create new,

affordable housing opportunities.

I support funding for the National American Indian Housing

Council. It is very discouraging to see that the President’s budget

proposal does not contain any funding for the council. I would ask

that this committee fully support funding for the council and its

membership of 265 tribes, including funds needed to keep up with

the cost of providing the services.

The final issue I would like to discuss today is the recent decision

from HUD to freeze all allocation of the NAHASDA block grant

funds to those tribes that have not yet received their fiscal year

2006 funding. HUD is apparently reacting to a court decision stemming from a lawsuit filed by the Fort Peck Housing Authority. The
19

court ruling declared a NAHASDA regulation invalid, which therefore changed the NAHASDA funding formula. I understand HUD

is appealing the decision and has decided to freeze funding until

the outcome of their appeal.

While we understand HUD’s need to protect itself, should they

lose this lawsuit, freezing all unobligated NAHASDA funding to

141 tribes is not the answer. It is not clear how these tribal housing authorities are going to operate without this funding. We ask

this committee to promptly consult with the Appropriations Subcommittee on HUD, the Banking, Housing and Urban Affairs Committee, about a possibility of a joint communication to HUD to obligate these funds. If HUD loses this lawsuit, they should be required to submit a supplemental appropriations request or to access the DOJ judgment fund, the same way any other agency

would if they lost a lawsuit

It has been an honor to be invited to testify before this committee. Thank you for having this hearing and for providing an opportunity for a panel of tribal representatives to come and give our

perspective on some of the important issues facing Indian Country

in the area of housing. Thank you.

[Prepared statement of Mr. Steele appears in appendix.]

Senator MURKOWSKI [presiding]. Thank you, Mr. Steele, and

thank you to all of you who have joined us here this morning.

The chairman had to excuse himself, he had another committee

that began at 10:30, and he had to make an introduction of another

individual. So he apologizes that he had to leave before the hearing

was able to conclude.

But I do appreciate the perspective that the three of you have

been able to give us, and to hear the concerns raised by the panel

as to the effect that tying up these funds through the Fort Peck

situation can have. We recognize that, and the Chairman and Vice

Chairman clearly stated the need to act in this area and to do so

very quickly.

Mr. Shuravloff, you had mentioned the working groups or the

task force that has been pulled together in anticipation of the

NAHASDA reauthorization coming up. I understand that you have

been working, or NAIHC has been working with the Native housing authorities nationwide to gather some suggested changes to

this act. I do understand that you have not yet formalized the report. Can you give us any preliminary insight as to the findings

that you can disclose at this point in time?

Mr. SHURAVLOFF. Senator Murkowski, at this point we are in the

process of gathering both regulatory and statutory issues that we

may want to look at during the reauthorization of the act. We hope

to have that concluded here in the very near future.

Senator MURKOWSKI. What does that mean, in the very near future? When do you anticipate you will be done with this?

Mr. SHURAVLOFF. Well, what the work product, the product that

is coming out is, we hope to have done it within the next couple

of months. Then in our December meeting, we hope to have a business meeting to ratify any amendments that the membership

would like to move forward with the reauthorization process.

Senator MURKOWSKI. So at this point, it is too early, too premature to indicate what some of the preliminary findings might be?
20

Mr. SHURAVLOFF. Yes; it is.

Senator MURKOWSKI. All right. You mentioned in your comments

the issue of mold. We are finding that, particularly in many of our

villages in western Alaska, mold is a tough issue for us, it is a significant issue. Can you give me some indication the extent of the

problem, beyond what I am aware of, in Alaska? How big of an

issue is this as it relates to our housing for Native Americans and

Alaska Natives?

Mr. SHURAVLOFF. It has become a large issue nationwide. I think

we see it a lot in Alaska, especially because of our housing building

techniques. I think most people realize that mold is a product of

not enough air movement through the house, and the moisture that

gathers, of course, creates the mold.

I know in Alaska there is a study that has been going on and

I think is being concluded on developing some different building

techniques. But I have been hearing of problems all across the

Country on mold issues. It is definitely a big issue.

In terms of numbers, I don’t have that available. But I know

across the country everybody seems to be dealing with it in just

about every State.

Senator MURKOWSKI. Certainly from the health perspective, it is

something that should cause us concern. We don’t want to be building housing that is going to cause health problems for those that

are living in them. We know that when you have any significant

degree of mold in a home, it can.

We had a hearing about 11⁄2years ago on teacher housing out in

rural Alaska, and heard testimony from a young woman that became very ill and learned that it was not necessarily the housing

techniques that had failed, they had installed the vapor barrier inside out or on the wrong side. So what had happened was a level

of mold buildup in the house, the house looked pretty good from the

outside. But it was not a liveable structure, because of some of the

construction issues.

So yes, we need to work to make sure that we have got good construction techniques. But we also need to remember that we can’t

move forward with just shoddy workmanship, either. I think in

that situation, that was exactly what was happening.

Mr. SHURAVLOFF. Yes, Senator; if I might add, I think a lot of

the problem is education on the homeowner’s part. Ventilation is

one of the main issues when you deal with mold. One of the things

we have found is that our own residents continually have to be

educated on the requirements of leaving windows open or turning

fans on to keep some ventilation within the unit.

That seems to be one of the big problems we are dealing with,

is education. It may not necessarily be the building itself, but just

the education of the residents within the unit.

Senator MURKOWSKI. Well, the education is certainly important.

When Ms. Green was testifying, speaking to the fact that there are

so many of our Alaska Natives, Native Americans, who have not

had certain background in financing, understanding the financing,

having built a credit record. Because they basically operate using

cash, having no bank account.

There is an educational process that comes with home ownership

that does not just relate to the management and operation of the
21

home itself, but also even prior to getting into the home. I think

we recognize that we have many issues that we need to deal with.

And we are not going to be able to resolve them all overnight. But

working together, with committed individuals, we will make some

progress.

I appreciate the time that you have taken, and the time that you

have taken to travel here to Washington to give us your perspectives. With that, we will adjourn the Committee. Thank you.

[Whereupon, at 10:40 a.m., the committee was adjourned.]

(23)

APPENDIX

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

PREPARED STATEMENT OF A.D. ELLIS, PRINCIPAL CHIEF, MUSCOGEE NATION,

OKLAHOMA

My name is A. D. Ellis and I am presently Principal Chief of the Muscogee

[Creek] Nation of Oklahoma. I have 15 years in elected office which included 8 years

on the National Council and 4 years as second chief.

Housing and Health issues in the Muscogee Nation are a top priority as it probably is for every tribal nation. With the increased funding in the last 15 years, we

have been able to keep up with the yearly demand but it seems to always have a

waiting list of 500 to 700 people. The Muscogee [Creek] Nation is situated in the

most depressed area in Oklahoma and has had this distinction for many years.

In 1997 with the introduction of the NAHASDA Program and the funding sent

directly to the tribe instead of the Housing Authority, we were able to serve our

peoples needs more efficiently. Unknown to most everyone in Oklahoma and especially State leaders such as Senators, Representatives and even the Governor, all

Tribal Housing Authorities were controlled by State laws. This was a great opportunity for tribal citizens to balk against elected tribal leaders as they served on

housing boards under State law and not tribal law. These housing boards were

formed in the late 1960’s before tribal government and constitutions were formed.

Great amounts of money and other assets were controlled by housing authority

boards that would not cooperate with tribal leaders. Even under these unfavorable

circumstances, we have built approximately 50 new homes per year and probably

another 50 homes purchased, called ‘acquisition homes’.

Another program that came with NAHASDA is the 184 Program and Mortgage

Assistance. Mortgage Assistance provides up to $25,000 for down payment and closing costs for those that qualify for a loan from a lender that participates in the program. This is a no payback benefit if the homebuyer stays in the home for a period

of years.

We have about 100 employees in our new housing division which is a new arm

of my administration. My first year in office I terminated the entire board of directors and top management and formed the new housing division controlled by the

tribal government. This is the third year of trying to exercise our tribal sovereignty

and was successful.

A friendly State Senator carried a specially crafted piece of legislation to the

Oklahoma Senate and House to unanimously pass the legislation to allow the

Muscogee Nation to assume all programs and assets of the Creek Nation Housing

Authority of Oklahoma. The State of Oklahoma ceased to exist with the Creek Nation Housing Authority.

Since assuming complete control we have made many policy changes to better

serve our citizens. One is to lower the income requirements to own a HUD of

NAHASDA home.
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• Previously a person had to earn over $15,000 to qualify. This left out the very

people that needed help the most. By lowering the earning requirements to

$5,000 annually the most needy and lower income people could qualify.

• A policy giving the full blood citizen priority along with tribal elders has been

implemented.

• Mortgage assistance was restricted to tribal boundaries and has been changed

to state boundaries. Now any Creek citizen living in the State of Oklahoma can

receive assistance.

Progress is moving slowly forward and if we continue to receive funds at this level

we plan to serve our present housing needs within 7 years.

Our present funding needs are now being challenged by reservation tribes from

other States. The funding is based on the 2000 census count which was based on

Indian and Multi-race Indians as listed on the census card.

A change in the numbers by a different census count, ‘‘Indian Only’’, could reduce

the funding for all Indians in Oklahoma and increase it for all Reservation Tribes.

The Indian population in Oklahoma is near 600,000 with most belonging to the Five

Tribes of Eastern Oklahoma being the Cherokee, Choctaw, Chickasaw, Seminole,

and Creek. If this formula has to be changed we hope it could wait until the 2010

census count.

Over all the NAHASDA program is working and the Native American population

is being served by a professional and capable housing division dedicated to serve the

Muscogee [Creek] people. Any support from the U.S. Congress and the U.S. Senate

is always appreciated and we need the funding levels to remain as they are or more.
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PREPARED STATEMENT OF MARTY SHURAVLOFF, CHAIRMAN, NATIONAL AMERICAN

INDIAN HOUSING COUNCIL

Good morning Chairman McCain, Vice Chairman Dorgan, Senator Murkowski,

and distinguished members of the Senate Committee on Indian Affairs. My name

is Marty Shuravloff and I am honored to appear before you today to discuss matters

related to the delivery of safe, decent, and affordable homes to Native people from

across our great Nation.

I am also honored to have been elected last month to serve as chairman of the

National American Indian Housing Council [NAIHC] the oldest and largest Indian

housing organization in the Nation, representing the housing interests of more than

460 tribes. I am an enrolled member of the Leisnol Village, serve my people as executive director of the Kodiak Island Housing Authority, and serve all Alaskans by

holding a variety of appointed posts such as with the Alaska Housing Finance Corporation.

Begun in 1974, 4 years after President Nixon issued his now-famous Special Message to Congress on Indian Affairs, the NAIHC is the major capacity building organization for Indian tribes and tribally designated housing entities [TDHEs] by providing guidance, technical assistance, training and related capacity-building services. The NAIHC trains thousands of Indian housing and other staff per year, offering most of its training without charging a fee. The NAIHC provides a full range

of programs and services such as technical assistance to TDHEs and Indian tribes

that include onsite visits, telephone and e-mail assistance, structured training classes for regional associations and housing Boards of Commissioners, and topic-specific

training courses at both its Annual Convention and Legal Symposium. These tailored training courses include a new crime prevention and safety initiative launched

in April 2005.

NAIHC also uses modem technology to save tribes time and travel costs by offering training by both web cast and video. For training courses and services that require travel, NAIHC offers a scholarship program that helps tribes and TDHEs offset the cost of sending individuals to much-needed and beneficial training that they

may not otherwise be able to afford. In 2005, 200 different tribes and TDHEs benefited by the granting of 751 scholarships by the NAIHC. In addition to offering onsite training, NAIHC maintains a comprehensive, highly visited website and is developing a premier state-of-the-art website to help Native people educate themselves

about the benefits and mechanics of homeownership. The ‘‘Native American Homebuyer’’ website and a technical Indian housing library are both scheduled to go online this summer.

Beginning in the early 1990’s, Indian tribes, housing authorities and others came

together to share their vision of how housing and related community development

ought to be carried out in Native communities in the era of Indian Self Determination. The NAIHC was instrumental in shaping these discussions and helping to

draft, in both spirit and letter, what would ultimately become the Native American

Housing Assistance and Self-Determination Act [NAHASDA] 25 U.S.C. §§ 4101 et

seq.

In 1996, this committee—under the leadership of Chairman McCain—approved

legislation that revolutionized the way Federal housing programs and services are

designed and implemented in Native communities. A Republican Congress approved

and President Clinton signed the NAHASDA. The NAHASDA rests on a firm foundation of Indian Self Determination and reflects the time-tested principles of local

tribal decisionmaking and tribal economic self-sufficiency.

Unlike previous Federal housing approaches, the NAHASDA is distinct in four

ways: It stresses the trust responsibility of the U.S. Government to house Native

Americans; it replaces categorical grant programs with a block grant that affords

tribes more flexibility to design housing to meet each community’s unique needs; it

encourages tribes to develop a long-term comprehensive housing strategy through

the preparation of housing plans; and it enables tribes unprecedented opportunities

to use different sources of financing to meet housing needs in their community.

NAHASDA is scheduled for reauthorization in 2007. Although we have made

some great strides since the inception of the act, further refinements are necessary

to make it an even more powerful tool for Native communities. The NAIHC has

taken a proactive role in gathering input from tribes across the Nation on the effectiveness of the act in meeting its intended purpose of providing quality, affordable

housing to Native people. We respectfully request congressional support for reauthorization of the act and this committee’s active and vigorous assistance in eliminating unnecessary and overly burdensome obstacles that frustrate the intent of

Congress and detrimentally impact Indian housing programs.
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For nearly 32 years the NAIHC has provided invaluable assistance to Indian

tribes and TDHEs and in no small measure has made the often-difficult implementation phase of the NAHASDA a success. Along the way, the NAIHC has endured

many difficulties including a Federal housing bureaucracy more concerned with its

own preservation and well-being than in meeting its obligation to Native people; and

Congressional appropriators who are unaware of—or worse, unmoved by—the dire

economic conditions that characterize Native communities.

The potency of Federal funding for the Native American Block Grant [NAHBG]

has been steadily eroded by inflation. Funding for the NAHBG in the past 9 fiscal

years is as follows:

Fiscal Year 1998 $600 million.

Fiscal Year 1999 $620 million.

Fiscal Year 2000 $620 million.

Fiscal Year 2001 $650 million.

Fiscal Year 2002 $648.2 million.

Fiscal Year 2003 $644.8 million.

Fiscal Year 2004 $650.3 million.

Fiscal Year 2005 $622.0 million.

Fiscal Year 2006 $623.7 million.

During the same time, Federal funding made available to the NAIHC for technical

assistance and training to Indian tribes and their TDHEs has also steadily eroded.

The Department of Housing and Urban Development [HUD] maintains that the

NAIHC has at its disposal $3,921,282.32 in ‘‘undisbursed funds’’ left over from fiscal

year 2004 and fiscal year 2005, and $1, 980.000.00 in ‘‘unobligated funds’’ left over

from fiscal year 2006, adding up to a total of $5,901,282.32 that in the minds of

HUD we are unable or unwilling to spend. The truth of the matter, as you know

Chairman McCain, is often not as simple as the Department would have you believe.

Funds appropriated to the National American Indian Housing Council [NAIHC]

are being used to provide critical housing related services to Indian tribes, TDHEs

and their staff and, just as important, the funds are being expended in a timely

manner. For the most recent fiscal year, the NAIHC expended $5,369,365 on HUDapproved, federally funded programs and services. According to HUD, $5,965,637.28

in prior appropriated funds were ‘‘in the pipeline’’ as of March 2006. At that time,

however, no invoices had been submitted to HUD for 2006 expenditures. If the

NA1HC were to continue to expend funds at the same rate as in 2005, the ‘‘pipeline’’

funds would be fully exhausted by January 2007, and any suggestions that there

is sufficient funding ‘‘in the pipeline’’ to last through the end of fiscal year 2007 are

simply inaccurate.

The main factors contributing to the ‘‘in the pipeline’’ perception are the many administrative delays which accompany the Cooperative Agreement entered into by

HUD and the NAIHC. The NAIHC receives its funds on a reimbursement basis

after incurring costs for HUD-approved activities. The NAIHC’s current Cooperative

Agreement with HUD took 6 months to complete from March 4, 2005, when NAIHC

submitted a Statement of Work to HUD to September 14, 2005, when it was executed. This process includes eight different steps within HUD before approval to the

NAIHC is granted. While HUD shows these funds as unused, NAIHC can show that

the funds will be exhausted by the activities of the NAIHC throughout the year.

If House passed levels of technical assistance funding prevail, NAIHC shuts down,

it is that simple. For fiscal year 2007, the House has proposed $990,000 for technical

assistance and training services for the NAIHC and it is no exaggeration to say

that, with this or a similar level of funding in the next fiscal year, the NAIHC will

close its doors in or around January 2007. Perhaps HUD intends to satisfy the demand for technical assistance and training by tribes and TDHEs thereafter, Mr.

Chairman, but this is the stark reality for the NAIHC.

The NAHASDA defines a clear government-to-government relationship between

the U.S. Government and Indian tribes for purposes of providing housing and sets

forth the trust responsibility of the U.S. Government to assist tribes in providing

housing and improve economic development to their members. Indian Self-determination, to be meaningful, means that the Indian tribes themselves, not HUD, design, implement, and conduct housing and related programs for their members.

Under this policy, tribal governments plan, conduct and administer Indian housing

programs and services for their own people. In passing the NAHASDA, Congress intended HUD’s role to be residual and to be minimally intrusive into tribal decisionmaking when it comes to housing. HUD’s extensive and often heavy-handed oversight of Indian housing programs undermines the ability of tribal governments to

make their own decisions about how to house and protect their people and manage
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their affairs. Rather than promoting Indian Self-Determination, tribes are subjected

to severe and overly burdensome regulations that not only hinder their housing programs but, more significantly, the regulations harm the welfare of their people.

In an attempt to resurrect the original intent of NAHASDA, the NAIHC, tribes

and TDHEs have established a legislative working group to identify and address

legislative and regulatory issues of tribal concern with the statute as it now stands.

Their issues include: the impediments of the Program Assessment Rating Tool

[PART] process and how to improve the data collection and reporting elements as

they relate to Indian housing; the severe problem with methamphetamine in Indian

communities; the insufficient or non-existent infrastructure in Indian communities;

addressing the problem of mold in federally assisted tribal homes; the establishment

of development reserve accounts as an eligible activity under NAHASDA; replacing

the 30 percent income rule with fair market rents; Federal procurement issues relating to housing materials; the elimination of secretarial approval for long term

leases and; overdue and necessary reforms to the Bureau of Indian Affairs Title Status Report process.

The NAIHC is committed to finding resolutions to these problems and is developing creative solutions to deal with these issues. For example, the Title Status Report

process can be improved if tribes were broadly authorized and encouraged to contract these functions such as under the Indian Self-Determination and Education

Assistance Act of 1975, as amended, 25 U.S.C. §§ 450 et seq. NAIHC has offered several training sessions on this topic for its members. In order to address the insufficient or non-existent infrastructure in Indian country, the NAIHC is collaborating

with Federal agencies in the development of an infrastructure Memorandum-of-Understanding that will encourage agencies to assist tribes with infrastructure development. In addition, NAIHC has established a second internal working group to

deal with issues related to the Native American Housing Block Grant Allocation

Formula. The NAIHC recognizes the importance of collaboration and is committed

to working with tribes and TDHEs across the Nation to address these issues and

reach resolutions on them.

The Native American Housing Block Grant program is the main program for

funding tribal housing under NAHASDA. NAHASDA relies on definitions of ‘‘Indian’’, ‘‘Indian tribe’’ and ‘‘Indian area’’ for the purpose of designating allocations.

The definitions of ‘‘Indian’’ and an ‘‘Indian tribe’’ are included in the NAHASDA at

section 4, paragraph 9. The term ‘‘Indian’’ means any person who is a member of

an Indian tribe and the term Indian tribe means a tribe that is federally recognized

or state recognized.

Historically, decennial census numbers have been one element in the calculation

of distribution of Native American Housing Block Grant funds. A change in the census collection technique in the 2000 decennial census led to a change in distribution

patterns causing a question to be raised regarding the use of a specific set of census

data. A failure of the negotiated rulemaking committee to arrive at a consensus on

which census data to use caused HUD to utilize a specific data set and has led to

a disagreement among tribes concerning the formula for distribution.

The NAIHC membership recently passed a resolution to endorse the use of ‘‘single-race data’’ in the formula calculations for the Native American Housing Block

Grant allocation. However, this committee knows that there remains disagreement

among NAIHC membership concerning the way in which American Indians and

Alaska Natives are counted by the U.S. Census Bureau. In an attempt to reach consensus on this issue, the NAIHC has established a Task Force with the goal of arriving at a position that is agreeable to all tribes regarding the counting of American Indian and Alaska Natives in the formula. The Task Force is to formulate a

position which they will then present to the NAIHC membership for approval. Because this issue is unresolved at many levels, we request the active support of the

Committee on Indian Affairs in these efforts.

The NAIHC is gravely concerned about HUD’s recent decision to potentially withhold allocation of the remaining fiscal year 2006 funds if the department is unable

to obtain a stay pending appeal of the Court’s decision in the Fort Peck Housing

Authority v. U.S. Department of Housing and Urban Development (Civ. Action No.

05–CV–00018–RPM–CBS, May 25, 2006). While we understand the difficulties presented by the Fort Peck decision, responding to what is a narrow decision possibly

only affecting the Fort Peck Tribe by withholding funds for hundreds of tribes may

be outside of HUD’s legal authority to do. Even more fundamental is the severe

hardship such a decision by HUD will have on recipients whose funding is inappropriately withheld. As you are aware, many if not most tribal and TDHE recipients

are dependent on such funding to continue operating and providing service to their

low-income members. Disruption of funding will impose substantial limitations on

these tribes and TDHEs, conceivably leading to some completely shutting down.
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Additionally, many tribes have pledged their Native American Housing Block

Grant funds as security for title VI or section 184 loans and HUD’s proposed course

of action would result in default on those loans, requiring the United States to assume the payment of these loans. Placing the tribes and TDHEs at risk of an adverse credit rating is unacceptable. NAIHC urges this committee to persuade HUD

to reconsider its decision and seek an alternative solution for the situation at hand.

In conclusion, I would like to thank you, Chairman McCain, Vice Chairman Dorgan, Senator Murkowski, and the members of the committee for your continuing

support of Native people and their housing programs. The NAIHC is eager to work

with the committee on all the issues affecting Indian housing programs—no matter

how difficult—so that together we can achieve objectives we both share, for example,

more and better housing for Native people, increasing homeownership in Native

communities, and building stronger tribal economies along the way.
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