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74–030 PDF 2012

S. HRG. 112–423

INTERNET INFRASTRUCTURE IN NATIVE

COMMUNITIES: EQUAL ACCESS TO E–

COMMERCE, JOBS AND THE GLOBAL

MARKETPLACE

HEARING

BEFORE THE

COMMITTEE ON INDIAN AFFAIRS 

UNITED STATES SENATE

ONE HUNDRED TWELFTH CONGRESS

FIRST SESSION

OCTOBER 6, 2011

Printed for the use of the Committee on Indian Affairs

(

(II)

COMMITTEE ON INDIAN AFFAIRS 

DANIEL K. AKAKA, Hawaii, Chairman 

JOHN BARRASSO, Wyoming, Vice Chairman 

DANIEL K. INOUYE, Hawaii 

KENT CONRAD, North Dakota 

TIM JOHNSON, South Dakota 

MARIA CANTWELL, Washington 

JON TESTER, Montana 

TOM UDALL, New Mexico 

AL FRANKEN, Minnesota 

JOHN MCCAIN, Arizona 

LISA MURKOWSKI, Alaska 

JOHN HOEVEN, North Dakota 

MIKE CRAPO, Idaho 

MIKE JOHANNS, Nebraska 

LORETTA A. TUELL, Majority Staff Director and Chief Counsel 

DAVID A. MULLON JR., Minority Staff Director and Chief Counsel 

(III)

C O N T E N T S 

Page 

Hearing held on October 6, 2011 ............................................................................ 1

Statement of Senator Akaka ................................................................................... 1 

Statement of Senator Franken ............................................................................... 3

Statement of Senator Murkowski ........................................................................... 34

Statement of Senator Tester ................................................................................... 2

Statement of Senator Udall .................................................................................... 3

WITNESSES

Blackwell, Geoffrey C., Chief, Office of Native Affairs and Policy, Federal 

Communications Commission ............................................................................. 4

Prepared statement with attachment ............................................................. 6

Danner, Robin Puanani, President/CEO, Council for Native Hawaiian Advancement ............................................................................................................. 77

Prepared statement .......................................................................................... 79

Gray-Proctor, Margo, Board Chairwoman, National Center for American Indian Enterprise Development ............................................................................. 41

Prepared statement with attachment ............................................................. 43

Hays, Howard, M.D., M.S.P.H., Acting Chief Information Officer, Indian 

Health Service, U.S. Department of Health and Human Services .................. 22

Prepared statement .......................................................................................... 25

Marrs, Carl, CEO, Old Harbor Native Corporation and the Kodiak-Kenai 

Cable Company .................................................................................................... 67

Prepared statement .......................................................................................... 69

Morgan, Lance G., Ceo, Ho-Chunk, Inc. ................................................................ 36

Prepared statement .......................................................................................... 38

Pollock, Michael J., Managing Director, Spectrum Gaming Group LLC ............ 55

Prepared statement .......................................................................................... 56

Porter, Hon. Robert Odawi, President, Seneca Nation of Indians ....................... 60

Prepared statement .......................................................................................... 63

APPENDIX

Akaka, Daniel K., letter, dated October 21, 2011 to the FCC ............................. 110

Gerlaugh, Darrell, Chairman, National Tribal Telecommunications Association, prepared statement ..................................................................................... 89

Mejia, Hon. Margie, Chairwoman, Lytton Rancheria, prepared statement ....... 99

Sneve, Shirley K., Executive Director, Native American Public Telecommunications ................................................................................................................... 101

Valandra, Joseph, Chairman, Tehan Woglake, Inc., prepared statement with 

attachment ............................................................................................................ 104

(1)

INTERNET INFRASTRUCTURE IN NATIVE 

COMMUNITIES: EQUAL ACCESS TO E–

COMMERCE, JOBS AND THE GLOBAL

MARKETPLACE 

THURSDAY, OCTOBER 6, 2011

U.S. SENATE, 

COMMITTEE ON INDIAN AFFAIRS, 

Washington, DC. 

The Committee met, pursuant to notice, at 2:15 p.m. in room 

628, Dirksen Senate Office Building, Hon. Daniel K. Akaka,

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. DANIEL K. AKAKA,

U.S. SENATOR FROM HAWAII 

The CHAIRMAN. I call this hearing of the Committee on Indian 

Affairs to order. Aloha and thank you all for being with us at this 

hearing today, which is on Internet Infrastructure in Native Communities: Equal Access to E–Commerce, Jobs and the Global Marketplace. 

I am very pleased to chair this hearing, because investing in telecommunications infrastructure is the best way we can help remote 

Native communities participate in the global marketplace while 

maintaining the unique character and culture of their homelands. 

In Hawaii, we live in the most remote location on Earth, alone 

in the middle of the Pacific Ocean. We rely on telecommunications 

infrastructure to keep us connected to the rest of the world and to 

help keep our economy running. Within our State, we have Hawaiian Home Lands, similar to Indian reservations or Alaska Native 

communities. These communities, like many Native communities, 

had little access to critical health, educational and economic development opportunities available in more urban locations where 

Internet and related telecommunications infrastructure are readily 

available. 

With an investment by FCC the majority of the Hawaiian Home 

Lands communities are now connected with fiber optic cable, the 

infrastructure necessary to deliver equitable access to Internet and 

the global marketplace today and for years to come. 

Many Native people have had to choose between staying home 

and connected to their language, culture and relations, or leaving 

home to pursue economic opportunity and jobs. Now in the information age and with the right investments in infrastructure, we 

have a real opportunity to remove this barrier. We can close disVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 S:\DOCS\74030.TXT JACK
2

tances in ways we have never been able to do before so Native communities can create economic, professional and educational opportunities at home. 

As this chart clearly shows, there is a need for Internet infrastructure in Native communities. 

I want to extend a special mahalo, or thank you, to all of those 

who have traveled far to join us today. Now I would like to turn 

to my colleagues, beginning with Senator Tester. 

STATEMENT OF HON. JON TESTER,

U.S. SENATOR FROM MONTANA 

Senator TESTER. Thank you, Mr. Chairman. I appreciate your 

holding this hearing on improving telecommunications in Indian 

Country. And I want to thank the witnesses for being here. We 

look forward to hearing what you have to say. 

In these days, cell phone and the Internet affects just about everything that we do. That should Indian Country more than it does 

right now. In fact, there is probably a greater need for telecom access across Indian Country, particularly in geographically isolated 

parts of Indian Country, such as those in rural Montana. For example, hospitals and medical clinics increasingly use technology to 

take advantage of tele-medicine opportunities that are improving 

and saving lives. 

Of course, our top priority here in the Senate, job creation Although cell service and the Internet by itself doesn’t create many 

jobs, access to it is critical. Without access, businesses cannot compete in today’s global economy. 

Access is also critical for public safety. Last week in this room 

we talked about improving public safety in Indian Country. As I 

know from living in rural Montana, too many people don’t have access to public safety, because they don’t have access to the phone 

service they need to cal 911 or anybody else who can help. 

And of course, education. To be competitive in today’s job market, 

the student who graduate from our schools need a well-rounded 

education. That includes both lessons of their culture and about the 

rest of the world. Internet access can bring the world to our reservations. And it can also bring lessons about our reservations to 

the rest of the world. 

I am proud of the Confederated Salish and Kootenai and the Fort 

Peck Tribes in Montana on this front. The Salish Kootenai College 

is a national leaded in using technology to create online curriculum 

and include their traditional culture to their students, students 

throughout the world. 

The situation is slowly getting better, but we still have a long 

way to go. This Committee has been working to improve access for 

a decade, but serious disparities still exist. I look forward to hearing from our witnesses today. We have studied the problem for 

years, and we know a lot about barriers. What we need today are 

solutions. I look forward to hearing your ideas. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you very much, Senator Tester. 

Senator Udall? 

3

STATEMENT OF HON. TOM UDALL,

U.S. SENATOR FROM NEW MEXICO 

Senator UDALL. Thank you, Senator Akaka, for holding this 

hearing on this important issue to Native American communities 

and to Native Hawaiian communities. 

Members of this Committee have traveled throughout Indian 

Country and witnessed many of the hardships on Tribal lands. This 

hearing is an important opportunity to call attention to a communications crisis, a crisis that most Americans are not aware of. 

Most people probably cannot imagine life without a telephone. 

Yet today more than 30 percent of households in Indian Country 

do not have access to basic telephone service. For members of the 

Navajo Nation in particular, the situation is even worse. Statistics 

do not adequately convey the hardships created by this lack of telephone service. Not having a land line or cell phone reception can 

mean the difference between life and death. Imagine not being able 

to call an ambulance when you or your loved one is in medical danger. 

A man outside Gallup, New Mexico missed two opportunities for 

a lifesaving kidney transplant because he lacked telephone service 

at home and could not be contacted in time. Members of this community know how essential it is that our Nation’s Tribal lands are 

not bypassed when broadband networks are built across the Nation. 

Although they are among the least connected, these areas are 

precisely where broadband technology can help the most. By overcoming physical distance and geographic isolation, broadband can 

help improve economic development, education and access to health 

care. 

I am pleased that FCC Chairman Genachowski is paying particular attention to this communications crisis that all the FCC 

commissioners have pledged their support for addressing this appalling digital divide affecting Native Americans. Today, draft proposals for Universal Service Fund reform will become available. I 

intend to carefully review them. Despite spending more than $8 

billion last year, the universal service fund has failed Indian Country when it comes to ensuring basic telephone service. We cannot 

fail again when it comes to building modern broadband networks. 

Thank you again, Chairman Akaka, and I yield back 

The CHAIRMAN. Thank you, Senator Udall. 

Senator Franken? 

STATEMENT OF HON. AL FRANKEN,

U.S. SENATOR FROM MINNESOTA 

Senator FRANKEN. Thank you, Mr. Chairman, for holding this 

very important hearing. I thank the witnesses in advance, I have 

read your testimony and I want to thank you for your work. 

Before we begin today, I think it is important to recognize the 

passing of one of the greatest technology visionaries of the last century, Steve Jobs. I was watching the news coverage last night. I 

couldn’t help but take note of just the tremendous outpouring that 

has surrounded his passing. I think this outpouring is in large part 

because the technology that Steve Jobs developed has transformed 

how we live and work in this community. I am guessing many of 

4

you have iPods or iPads and iPhones on you today. And I would 

put them on vibrate during the hearing. 

[Laughter.] 

Senator FRANKEN. But I think it is important to remember that 

Steve Jobs started building devices in his garage. Young entrepreneurs and innovators who are starting out like Steve Jobs did 

many decades ago need Internet access to have a shot at developing the latest cutting edge device or gadget or web-based business. It shouldn’t matter if that entrepreneur is working out of a 

garage in the Bay Area or out of a garage on the Red Lake Reservation in Minnesota. Both people should have equal access to 

high speed broadband and equal access to the American dream. 

The Internet is not a luxury item any more. It is a necessity 

today, and it is only going to become an even greater necessity in 

the years to come. Unfortunately, Native American communities 

continue to lag way behind in broadband access. This puts these 

at a huge disadvantage in an already troubled economic climate. 

I am happy that we have the opportunity today, thanks to the 

Chairman, to examine the causes of the Native American digital divide and determine what we in Congress and what the FCC can 

do to remedy this problem. We have several distinguished witnesses appearing before the Committee today, and again, I would 

like to thank the first panel and the second for taking time to discuss this important issue. I look forward to hearing from our witnesses about how we can improve Internet infrastructure in Native 

American communities. 

Thanks again, Mr. Chairman. 

The CHAIRMAN. Thank you very much, Senator Franken. 

As Chairman, it is my goal to ensure that we hear from all who 

want to contribute to the discussion. The hearing record, therefore, 

will be open for two weeks from today and I encourage everyone 

to submit your comments through written testimony. 

I want to remind the witnesses to please limit your oral testimony to five minutes today. 

Serving in our first panel is Mr. Geoffrey Blackwell, Chief of the 

Office of Native Affairs and Policy, within the Consumer and Governmental Affairs Bureau at the Federal Communications Commission, located in Washington, D.C. And Dr. Howard Hays, Acting 

Chief Information Officer at the Indian Health Service within the 

Department of Health and Human Services, also located in Washington, D.C. 

Welcome to you on our first panel to this hearing. Mr. Blackwell, 

will you please proceed with your testimony? 

STATEMENT OF GEOFFREY C. BLACKWELL, CHIEF, OFFICE OF 

NATIVE AFFAIRS AND POLICY, FEDERAL COMMUNICATIONS 

COMMISSION 

Mr. BLACKWELL. Chairman Akaka, Senator Tester, Senator 

Udall, Senator Franken, members of the Committee, aloha and 

thank you for the opportunity to testify today. 

The lack of communications service in Native America is alarming. The most recent reliable census data indicates that only 67.9 

percent of Tribal homes have basic telephone service. More troubling, less than 10 percent have access to broadband, the lifeblood 

5

of our 21st century economy, education, health care and public 

safety. 

Broadband can do much to level the negative impacts of history 

on Native communities. But it must be available, affordable and accessible to meet its promise. Diverse and comprehensive needs 

make it clear that one size fits none, and almost no critical infrastructure has come to Tribal lands without Federal investment, 

oversight and regulation. The enormity of our mission is vast. 

The purpose of the Office of Native Affairs and Policy is to 

change the way we approach these problems. We are one year old 

now, and we are charged with developing and driving a Native 

agenda across the Commission. But, changing our rules alone is 

not enough. Complex problems require new approaches and mechanisms, and as well as active efforts both in Washington and far 

into the field to develop well though-out solutions. 

Under Chairman Genachowski’s leadership, with the longstanding support of Commissioner Copps and throughout the entire 

Commission and all of its bureaus and offices, there is a new way 

of doing Native business at the FCC. Native nations are central in 

that new paradigm. Our work with them is a strategic partnership 

in which we exercise the Commission’s trust relationship with Native nations. 

To fulfill our mission, we are fostering the Commission’s government to government dialogue directly with Native nations to understand their needs and empower their solutions. Our approach is to 

work together to identify and remove barriers and build models 

that engage their anchor institutions. We seek to place Tribal nations and Native communities themselves in the center of those solutions, whether through self-provisioning of services or through 

new Tribal-centric methods of deployment with industry, public or 

private partners. 

Our work with the new FCC Native Nations Broadband Task 

Force will ensure that Native concerns are considered in all relevant Commission proceedings and that new recommendations are 

developed. This active, invested involvement of Native nations is 

critically important to finding lasting solutions. 

To transform the landscape, our office cannot be just another 

outsider from Washington. Instead, it must be a knowledgeable 

and respected Indian Country insider. Upon being established, we 

actually rolled out the Office in Native America, while also working 

across the Commission to surface actions and proposals. During our 

first year of operation, we continued our commitment to working 

with Native leaders where the challenges occur, logging thousands 

of miles from here west to the Hawaiian Home Lands. We have 

gone deep into Tribal lands and Native communities, traveling to 

places the Commission has never been before, and seeking the 

input of American Indian, Alaska Native and Native Hawaiian 

leaders. 

Several times on Tribal lands, we have had to reset our phones 

and log off and log back in. In distance diagnosis sessions and 

classrooms at the Native end of the signals, we saw the human element of the lack of services and the limitations of connectivity, 

speed and reliability. Now we have that knowledge in hand and we 

are acting on it. 

6

Under the Chairman’s leadership, the Commission launched a 

series of groundbreaking proceedings at its March 3rd meeting 

named Native Nations Day. From rules expanding Tribal priority 

broadcasting opportunities to proposed rule for new mobile wireless 

licensing to an omnibus inquiry on a range of issues related to 

broadband adoption and deployment, the proceedings of Native Nations Day serve as a foundation for consultation and critical 

rulemakings. These include an inquiry on a Native Nations priority 

to remove barriers to entry within our rules, the creation of a Native Nations broadband fund for a myriad of deployment purposes, 

and a Commission-wide uniform definition of Tribal lands. 

Critical to the work of our office is our close coordination with 

others across the Commission, and we will continue to provide 

guidance on a variety of other rulemakings and actions. During 

both our travels and in many meetings here in Washington, we 

have heard many comments, priorities and concerns. One such priority is the accurate measurement of the actual state of broadband 

availability on Tribal lands. Many tribes have articulated concerns 

about both the depth and accuracy of this data on their lands. 

Increased coordination among relevant Federal agencies and a 

meaningful involvement of the Native Nations, embracing them as 

partners, would address potential unintended barriers to entry. 

In conclusion, we have heard several recurring themes from Native leaders: continue to meet and listen to us, to use what we tell 

you to bring connectivity to our communities. The overarching message is that if consultations and training sessions are to be productive, and if efforts to place Native nations at the center of the process are to succeed, we must see the problems first-hand, work 

where they exist and endeavor to find solutions in concert. We welcome this challenge. 

Thank you again for the opportunity to testify this afternoon. 

Mahalo. I look forward to any questions you may have. 

[The prepared statement of Mr. Blackwell follows:]

PREPARED STATEMENT OF GEOFFREY C. BLACKWELL, CHIEF, OFFICE OF NATIVE

AFFAIRS AND POLICY, FEDERAL COMMUNICATIONS COMMISSION

Chairman Akaka, Vice Chairman Barrasso, and Members of the Committee, 

thank you for the opportunity to testify today about the importance of broadband 

infrastructures in Native Nations and Communities, and the Commission’s efforts 

to work with Native leaders to find viable solutions. 

The lack of all communications services in Indian Country is alarming. Our most 

recent reliable census data indicates that over 70 years of development and expansion of the telecommunications industry has resulted in only 67.9 percent of residents of Tribal lands enjoying basic telephone service. The statistics for broadband 

penetration are even more troubling—less than 10 percent of residents of Native 

Nations have access to the lifeblood of our 21st century economy, educational opportunities, health care, and public safety. 

This past April, I told the Senate Commerce Committee what many on the Senate 

Committee on Indian Affairs already know—that these too familiar statistics paint 

only part of the picture and behind them lurks a stark and complex reality. The 

negative impacts of history fell particularly hard on Tribal and Native Communities. 

One result of this history is an endemic lack of many critical infrastructures. In fact, 

almost no critical infrastructure has come to Tribal lands without federal investment, oversight, and regulation. Broadband opportunities can do much to level this 

history in bringing health care, education, jobs, and the opportunities of hope to Native Nations, but broadband must be available, accessible, and affordable to meet 

its great promise. 

7

The purpose of the Office of Native Affairs and Policy is to change the approach 

to the communications problems of Native America. Our work with Native Nations 

is a new strategic partnership, one in which we effectuate and exercise the trust 

relationship that the Commission shares with Native Nations. There are numerous 

and comprehensive communications needs throughout Indian Country, and there is 

great diversity within those critical needs. The need for telemedicine is greatest for 

some Tribal Nations, while the needs for educational technology or public safety are 

paramount for others. In many Native places, Indian Reservations for instance, 

connectivity often occurs only in border towns and along major transportation routes 

crossing over Tribal lands. It is clear that one size fits none, and the enormity of 

our mission is vast. Changing our rules alone is not enough. Complex problems require new approaches and mechanisms, and active efforts both in Washington and 

in far into the field to develop and coordinate well thought-out solutions. 

Created by a unanimous vote of the Commission on August 12, 2010 and implementing a recommendation of the National Broadband Plan, the Office of Native Affairs and Policy is now just over a year old. The Office is responsible for developing 

and driving a Tribal agenda at the Commission and serves as the Commission’s primary point of contact on all Native issues. The Office is charged with bringing the 

benefits of a modern communications infrastructure to all Native communities by, 

among other things, ensuring robust government-to-government consultation with 

Federally-recognized Tribal governments and other Native organizations; working 

with Commissioners, Bureaus, and Offices, as well as with other government agencies and private organizations, to develop and implement policies for assisting Native communities; and ensuring that Native concerns and voices are considered in 

all relevant Commission proceedings and initiatives. Under Chairman 

Genachowski’s leadership, and with the involvement of the entire Commission and 

all of its Bureaus and Offices, there is a new way of doing Native business at the 

Commission, and Native Nations are central in that new paradigm. 

The Efforts of the Office of Native Affairs and Policy 

Our approach is to work together to identify and remove barriers to solutions and 

build models with Native Nations that engage their core community or anchor institutions. We seek to place Native Nations themselves in the center of those solutions, 

whether it is through actual self-provisioning of communications services or through 

new ‘‘Tribal-centric’’ or ‘‘Nativecentric’’ methods of deployment with industry, public, 

or private partners. These models must respect the cultural values and sovereign 

priorities of Native communities and be infused with the local knowledge that will 

lead to better local involvement and opportunities for success. As Tribes govern with 

a unique understanding of their communities, their vested and active involvement 

is critically important to finding lasting solutions in their communities. 

To fulfill its mission, the Office is fostering the Commission’s ongoing governmentto-government dialogue with Native Nations by working directly with them to understand their needs and empower them to provide their own solutions. New opportunities must be created for Native Nations and those who work with them to find 

sustainable solutions. To fulfill our mission and transform the communications landscape, our Office cannot be just another outsider from Washington. Instead, the Office must be a knowledgeable and respected Indian Country insider. We must foster 

and maintain an expert understanding and familiarity with Tribal lands and Native 

Communities. Collectively, our four senior staff members have over 40 years of experience working in the trenches of the Commission and directly with Native Nations. We are adding to those ranks and we stand ready for the challenge. 

One year ago, immediately upon being established, we hit the ground running. We 

actually rolled out the introduction of our new Office in Native America on a ‘‘listening tour,’’ while at the same time working across the Commission to surface actions 

and proposals. We have continued with our commitment to working with Native 

leaders in their own reservations and homelands, where the problems actually exist. 

Side-by-side with our Native Nation colleagues, we have ‘‘kicked the dirt’’ within numerous Native Nations, and discussed how we can help them with their development and deployment plans. Several times, we have had to reset our phones and 

blackberries, log off and log back in, and set our out-of-office automatic reply messages to let folks know we are traveling in very unconnected regions. 

Within our first year of operations, we traveled to and met with Tribal leaders 

in Arizona, California, Idaho, Montana, Nevada, New Mexico, North Dakota, Oklahoma, South Dakota, Utah, and Washington, as well as within Hawaiian Home 

Lands. Other remote and underserved areas of the country, including those within 

Alaska, are at the top of our future travel priorities. We logged thousands of miles 

and traveled to places where the Commission has never been before, experiencing 

the lack of connectivity from the other end of the digital divide, and seeking the 

8

input of American Indian, Alaska Native, and Native Hawaiian leaders. We will 

continue to go deep into the Native Nations, meeting collectively and individually 

with Tribal leaders, Tribal Councils, Native associations, Tribally-owned and operated communications providers, Tribal broadcasters and broadband providers, as 

well as with Native consumers and businesses. 

To obtain a firsthand view of the complexity of the problems, we have been to 

some of the most unserved areas of the Nation. To see the challenges Native Nations face, we visited some of the most remote schools in the country, such as the 

Jack Norton School on the Yurok Reservation in California, which is the only school 

in the state that still operates on a diesel generator. The school is planned to receive 

its first ever Internet service in a new build out based on an experimental license 

the Commission granted and one-time federal grant money from the Rural Utilities 

Service’s Community Connect program. We learned more about the important and 

life-changing impact of broadband when we engaged in distance education discussions from classrooms at the Native end of the signals. We learned the true value 

of high speed Internet connections on the island of Moloka’i, where we accepted the 

gracious invitation of an oncology patient at the Native end of the line and sat in 

on her diagnosis session with her doctors in Honolulu. Hearing the somber diagnosis, like her, we too struggled to read the expressions on the doctors’ faces with 

the lower speed and, therefore, lower resolution connection. In Native Communities, 

one sees the human element of the lack of communications and broadband services, 

and the limitations of connectivity, speed, and reliability. 

On many occasions we saw impressive solutions juxtaposed with overwhelming 

great need. For example, on the Cheyenne River Sioux Reservation, we saw the oldest Tribally-owned and operated wireline telecommunications company, the Cheyenne River Sioux Tribe Telephone Authority, deploying fiber to a remote internal 

valley in their lands. At the Standing Rock Sioux Tribe, we met with their leaders 

and the management of the Tribe’s exciting new wireless company, Standing Rock 

Telecom, Inc. Two weeks later, we spoke with elected leaders and educators of the 

Karuk Tribe in the upriver region of the Klamath River in far northern California, 

who experience little or no wireline or wireless telephone connectivity on their 

lands. High speed Internet is available only at a local computer center. While in 

Utah some weeks earlier, we met with the leaders of the Confederated Tribes of the 

Goshute Indian Reservation, who explained that they have been operating for over 

eight years under a communications state-of-emergency articulated by their Tribal 

Council—with few comprehensive and immediate solutions in sight. Similar examples exist throughout Indian Country and Native Communities. 

In addition to our travels to Tribal lands, we have met with many dozen Native 

Nations and entities at the Commission’s headquarters on a myriad of issues involving broadband, broadcast, and telephony matters. On both our travels and in Washington, we have heard many common priorities and concerns. One such priority is 

the accurate measurement of the actual state of broadband availability on Tribal 

lands. Many Tribes have articulated concerns about both the depth and accuracy of 

the data on the state of services on their lands. Tribal and Native community leaders have asked how this data is verified by the state and federal agencies involved. 

In the case of the Goshute Confederated Tribes, during the late September Native 

American Summit in Salt Lake City, we witnessed their explanation to the Utah 

state broadband mapping manager that the gross overestimation of the wireless 

broadband coverage on their reservation actually precluded them from applying for 

federal grants and loans for a Tribal project that would address the lack of services. 

The Utah state broadband mapping coordinator explained that the federal grant did 

not have funding to verify the data. Increased coordination among the relevant federal agencies and a meaningful involvement of the Native Nations, embracing them 

as partners, would begin to address these unintended barriers-to-entry. 

The Proceedings of March 3, 2011—’’Native Nations Day’’—New Commission 

Approaches 

Under the Chairman’s leadership, the Commission launched a series of 

groundbreaking endeavors at its March 3rd Open Meeting, on a day the Commission 

named ‘‘Native Nations Day.’’ It was a day of ‘‘firsts’’— the first time that the Commission used its meeting agenda to address matters entirely and specifically developed for Native Nations; the first time that Tribal leaders formally addressed the 

Commission at the start of an Open Meeting; and the first time that the Commission initiated a comprehensive inquiry and rulemaking proceeding focused exclusively on Native communications needs. 

From rules expanding broadcast opportunities, to proposed rules for new mobile 

wireless licensing opportunities, to an omnibus inquiry on a range of issues related 

to broadband adoption and deployment on Tribal lands, the proceedings of Native 

9

Nations Day will in part serve as the foundation for the nation-to-nation consultation with Native Nations that is a critical component of the Commission’s rulemaking process. 

The Rural Radio Tribal Priority Order. Native Nations want to provide information and community news to their people, and are looking at radio programming to 

promote and preserve Native culture and language, and to advance cultural dialogue. KUYI on the Hopi Reservation, KLND on the Standing Rock Reservation, and 

KIDE on the Hoopa Valley Reservation are prime examples of such cultural enterprise. Last year, the Commission took steps to address the imbalance in the number 

of radio stations licensed to Native Nations and communities, as compared to the 

rest of the country, when it adopted an historic Tribal Priority designed to award 

a decisive preference to any federally recognized American Indian Tribe or Alaska 

Native Village seeking to establish its first non-commercial radio station on its Tribal lands. The Tribal Priority was greeted with enthusiasm by Native Nations, but 

it was noted that certain Native Nations, because of their historical or geographic 

circumstances, might not be able to take advantage of the priority. In a Second Report and Order adopted on Native Nations Day, the Commission addressed these 

special circumstances by adopting provisions to address the needs of non-landed Native Nations and those with small or irregularly shaped lands that make it difficult 

to meet some of the requirements of the Tribal Priority. In addition, the Commission 

adopted a Notice of Proposed Rulemaking seeking comment on proposals to apply 

the Tribal Priority to certain commercial FM channel allotments and potentially obviating the need to go to auction. This proceeding is pending at the Commission, 

and the hope is that these new mechanisms can help Native Nations deploy services 

in this critical and widely adopted media technology, as they also build designs and 

resources for new advanced broadband platforms. 

The Wireless Spectrum Tribal Lands Notice of Proposed Rulemaking. While competitive market forces have spurred robust wireless communications services in 

many areas of our country, wireless connectivity for Native Nations remains at significantly lower levels. Native Nations have expressed to us many concerns that the 

situations they face at home involve the very basics of public safety—the inability 

to make a wireless call in an emergency. Native Nations have asked the Commission for greater access to robust wireless spectrum to meet the challenges of terrain 

and distance that many Native communities face and, for some time now, the need 

for this action has been critical. On Native Nations Day, the Commission adopted 

a Notice of Proposed Rulemaking to promote greater use of spectrum to help close 

the communications gap on Tribal lands and to ensure that Native Nations are at 

the center of the decisionmaking process. This NPRM, one of the most important 

requests from Native Nations in the last decade, strives to put licenses in the hands 

of those who will value the spectrum and build out on Tribal lands. This proceeding 

is pending at the Commission. Three of the five proposals launched in the NPRM 

would create new opportunities for Native Nations to gain access to spectrum 

through Commercial Mobile Radio Services licenses, while the other two proposals 

are designed to create new incentives for existing licensees to deploy wireless services. 

The Native Nations Notice of Inquiry. The Commission has said on many occasions that broadband is indispensable infrastructure for economic growth and job 

creation, and nowhere is that need more acutely felt than on Tribal lands. The lack 

of robust broadband services—and, in fact, even basic communications services—

contributes to the challenges Native Nations face in building strong economies with 

diverse businesses and development projects. On Native Nations Day, therefore, the 

Commission launched a broad-based inquiry into a wide range of communications 

issues facing Native Nations—an inquiry that will provide a foundation for updating 

the Commission’s rules and policies to provide greater economic, market entry, and 

communications adoption opportunities and incentives for Native Nations. The result of a broad collaborative effort across the Commission, led by the Office of Native Affairs and Policy, the Notice will lay the groundwork for policies that can help 

Native Nations build economic and educational opportunities for their own Tribal 

lands. The Notice seeks comment on the best ways to support sustainable 

broadband deployment, adoption, and digital literacy training on Tribal lands. 

Among other important questions, the Commission asks about the possibility of expanding the Tribal Priority concept into a Native Nations Priority, to identify and 

remove barriers to entry, rather than using a case-by-case waiver approach, thus 

making it easier for Native Nations to provide other services—wireless, wireline, 

and satellite—to their communities. The Commission also asks about opportunities 

to use communications services to help Native Nations address public safety challenges on Tribal lands, including the broad lack of 911 and E–911 services, and the 

needs of persons with disabilities on Tribal lands. 

10

Recognizing that, given their unique challenges and significant obstacles to 

broadband deployment, Native Nations need substantially greater financial support 

than is presently available, the Notice of Inquiry also seeks comment on a recommendation of the National Broadband Plan to establish a Native Nations 

Broadband Fund. The National Broadband Plan notes that grants from a new Native Nations Broadband Fund could be used for a variety of purposes, including 

bringing high-capacity connectivity to governmental headquarters or other anchor 

institutions, deployment planning, infrastructure build out, feasibility studies, technical assistance, business plan development and implementation, digital literacy, 

and outreach. In the Notice of Inquiry adopted on Native Nations Day, the Commission seeks comment on a number of issues associated with the establishment of the 

Native Nations Broadband Fund, including the need for such a fund, the purposes 

for which it would be used, and the level of funding. The public comment period for 

the Notice recently ended, and we are in the process of assessing the record and 

determining next steps for each of the issues addressed in the Notice. 

The Low-Income Program Notice of Proposed Rulemaking. The Low-Income program of the universal service fund, commonly known as Lifeline and Link Up, has 

been, and continues to be, a critically important component in extending the reach 

of communications services to Native Nations. But with a telephone penetration rate 

hovering below 70 percent and a broadband penetration rate well below ten percent, 

much remains to be done. According to Gila River Telecommunications, Inc., a Tribally-owned telecommunications company, the telephone penetration rate for the Gila 

River Indian Community stands at 86 percent, still well below the national average 

of 98 percent but significantly above the average on Tribal lands. Gila River attributes its success in expanding the reach of telephone service largely to Lifeline, 

given that roughly 91 percent of the Community’s elders participate in Lifeline. At 

the afternoon session of its March 3rd Open Meeting, the Commission adopted a Notice of Proposed Rulemaking in which it proposes to reform and modernize Lifeline 

and Link Up—issues of great interest to Native Nations. The Commission is preparing to take action in the near future to address many of the issues raised in the 

Notice of Proposed Rulemaking. 

Universal Service Reform—The Connect America Fund and The Mobility Fund. As 

part of a major rulemaking procedure, the Commission is preparing in the very near 

future to reform and modernize the High Cost component of the universal service 

fund, with a proposed transition to a Connect America Fund, including a Mobility 

Fund. The Office of Native Affairs and Policy is working closely with the Wireline 

Competition Bureau and the Wireless Telecommunications Bureau to finalize policies that will increase broadband availability—including mobile broadband—in Native Nations, while preserving existing services. In finalizing reforms, we are focused on the unique challenges facing Native Nations, which may not be suitable 

for a one-size-fits-all solution. 

The FCC-Native Nations Broadband Task Force. One of the top requests from Native Nations in the National Broadband Plan was the creation of a new FCC-Native 

Nations Broadband Task Force that would ensure that the Commission’s consultation with Native Nations is an ongoing, continuous dialogue and a shared effort between partners. Chairman Genachowski fulfilled this request when, on Native Nations Day, he appointed to the Task Force 19 members representing Native Nations 

and 11 members representing Bureaus and Offices across the Commission. The 

Task Force has met twice since its inception—once via conference call and once in 

person—and is formulating plans to meet again in the near term. The Task Force 

will ensure that Native concerns are considered in all relevant Commission proceedings and will work to develop additional recommendations for promoting 

broadband deployment and adoption on Tribal lands. The Task Force will also coordinate with external entities, including other federal departments and agencies. 

These efforts will culminate in more efficient ways of working with our Native Nation partners, the industries, and the institutions of Native Nations. 

Conclusion 

The Office of Native Affairs and Policy is ready to continue rolling up our sleeves 

and pulling out our laptops as we continue our mission. Native Nations Day was 

a success, and the Commission is proud of the work it has done so far. However, 

we must build on that success and the success of our other activities since the creation of the Office a mere 14 months ago. Among other things, one of our top priorities is to overhaul, update, and increase the collaborative value of the Commission’s 

Indian Telecom Initiatives, or ITI, program, moving it from version 2.0 to version 

10.0 and even beyond. We look forward to increasing the effectiveness and value of 

these regional workshops, trainings, consultation, and networking events. We also 

look forward to establishing, by the end of the year, a federal interagency broadband 

11

working group that engages other federal agencies concerned with Native Nations 

and with missions on Tribal lands related to broadband and communications deployment, such as education, health, public safety, energy, cultural preservation, and 

economic empowerment. With a new inter-agency initiative on Native broadband, 

the Federal Government can coordinate both internally and directly with Native Nations on broadband-related policies and programs. 

Internally, we look forward to working with colleagues across the Commission to 

increase the value of the information tools that the Commission has for Native Nations and Communities. For example, the Commission’s Spectrum Dashboard 2.0, 

which was unveiled in March, allows users to view the licenses and spectrum leases 

that cover specific or all Tribal lands. We plan to continue holding meetings with 

Native Nations to discuss how this and other Commission information tools can be 

improved and more responsive to the needs of Tribal communications planners. We 

also look forward to reviving an internal training and speaker series for decision 

makers and colleagues across the Commission on how to work with Native Nations 

and the basics of how to coordinate and conduct consultations with Native Nations. 

In conclusion, we have heard several recurring themes in our conversations with 

Native leaders—continue to meet with us, listen to us, and use what we tell you 

to bring communications on Tribal lands into the 21st century. The overarching 

message is that, if consultations are to be successful, if future education and training sessions are to be well-attended and productive, and if efforts to inform, educate, 

and put Native Nations at the center of the decisionmaking process are to succeed, 

we must do our work with Native Nations largely within their Native communities. 

Native Nations are aware of our Office’s abilities and many have told us that, in 

order to best help them solve communications problems, we must work with them 

where the problems exist, see the problems first-hand, and endeavor to find the solutions in concert with them. We welcome all of these opportunities. 

Thank you again for the opportunity to testify this afternoon. I look forward to 

answering any questions you may have. 

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The CHAIRMAN. Thank you very much, Mr. Blackwell. 

Dr. Hays, will you please proceed with your testimony? 

STATEMENT OF HOWARD HAYS, M.D., M.S.P.H., ACTING CHIEF 

INFORMATION OFFICER, INDIAN HEALTH SERVICE, U.S.

DEPARTMENT OF HEALTH AND HUMAN SERVICES 

Dr. HAYS. Mr. Chairman and members of the Committee, good 

afternoon. I am Dr. Howard Hays, Acting Chief Information Officer 

for the Indian Health Service. 

I am pleased to have the opportunity to testify on innovation in 

health care technology within the Indian Health System and its 

benefits to Native communities with respect to e-commerce, jobs 

and the global marketplace. 

As you know, the Indian Health Service offers a comprehensive 

health care delivery system to 1.9 million members of federally-recVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00026 Fmt 6633 Sfmt 6601 S:\DOCS\74030.TXT JACK

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ognized American Indian and Alaska Native tribes through federally and Tribally operated hospitals and clinics and urban Indian 

health programs in 35 States. The mission of the agency is to raise 

the physical, mental, social and spiritual health of American Indian 

and Alaska Native people to the highest level in partnership with 

the tribes and the communities that we serve. 

The Indian Health Service is a health care agency, and our testimony today will focus on technology infrastructure in Indian communities in the context of health care, tele-medicine in particular, 

both its current state and the potential for the future. 

Despite improvements in health status for a number of conditions over the decades, American Indians and Alaska Natives continue to face disparities in access to care, preventable morbidity 

and mortality, and the burden of chronic disease. The prevalence 

of heart disease and diabetes remains considerably higher among 

the Native populations, as does the risk from certain mental health 

disorders compared to other racial and ethnic groups. The distribution of the American Indian and Alaska Native populations and our 

health care facilities over some of the most beautiful but isolated 

and under-served parts of the Country increases the challenges of 

health care delivery, especially where specialty care and consultation are concerned. 

This is where tele-health services can have their greatest impact. 

Tele-health is an increasingly critical part of patient-centered care. 

The diverse tool kit of tele-health includes real-time teleconferencing, store and forward consultation, remote patient monitoring, 

and mobile health, or m-health. These rapidly evolving tools and 

capabilities enhance timely consultation, diagnosis and treatment, 

supporting best practice approaches to care. They also enable new 

models of care that emphasize relationships and communication 

while facilitating improved quality, cost effectiveness and value. 

The IHS has embraced tele-health since the 1970s when a collaboration among the IHS, NASA, the Department of Health, Education and Welfare, and the Papago, or Tohono O’odham, Tribe created the STARPAHC project. STARPAHC provided realtime satellite-based communication across the very large Tohono O’odham 

Reservation in Southern Arizona. 

More recent examples of IHS success with tele-health service delivery innovation include the Alaska Federal Health Care Access 

Network, or AFHCAN, and the IHS Joslin Vision Network TeleOphthalmology Program. AFHCAN started in 2001 and provides 

tele-health services to over 300 Alaska villages and Federal sites. 

Over 106,000 tele-health cases have been created in AFHCAN over 

the past decade. Using store and forward technology, AFHCAN has 

been shown to greatly reduce waiting times for specialty care and 

dramatically reduce travel costs. 

The Joslin Vision Network Tele-Ophthalmology Program now 

serves 78 sites in 22 States. JVN sends retinal photographs to a 

central reading center where specialists can diagnose early diabetic 

retinopathy and recommend interventions to reduce the risk of 

blindness. Over 50,000 patient examinations have been completed 

through the JVN program, including 10,000 patients in 2010 who 

had never previously been screened. 

24

Tele-behavior health services are growing rapidly across the Indian Health Care system with many facilities relying on tele-health 

to reach mental health providers that would not otherwise be available to patients. Our partners in tele-behavioral health service delivery include the University of New Mexico and the University of 

Colorado. 

Chronic disease management using tele-health technologies is 

being implemented by 12 IHS and Tribal facilities participating in 

our Improving Patient Care initiative. These sites will use remote 

home blood pressure monitoring to enhance care coordination of patients with diabetes and poorly-controlled blood pressure. Also, a 

new tele-trauma collaboration between IHS and the University of 

New Mexico Regional Trauma Center provides timely consultation 

and evaluation of CT scans for patients seen at the Gallup Indian 

Medical Center, improving the early and accurate evaluation of patients with head injuries and helping to decrease unnecessary patient transfers. 

Other services such as dermatology, cardiology, nutrition, radiology and pharmacy are provided by tele-health in certain Indian 

Health locations. But few of these services are available systemwide, and substantial variation exists across Indian Health regarding the availability of tele-health tools and the infrastructure to 

support using them. Network infrastructure in many locations is 

insufficient and requires upgrading. Operational capacity for expanded implementation, training and technical support is often 

sub-optimal. And many programs lack the clinical and support staff 

to coordinate and perform the services. Secure interfaces between 

systems need to be developed and the policies and standard that 

will permit the leveraging of new mobile health technologies in 

many cases remains to be established. 

Finally, reimbursement policies for tele-health services lags behind the available technologies, constraining the availability of Indian Health facilities to promote adoption and change. The variability in system capabilities and utilization of tele-health tools hampers the ability of the Indian Health System to expand regional 

successes into national models of care. With strategic use of innovation on a scale that can extend quality health care, public health 

support and learning capacity to all American Indian and Alaska 

Native communities. 

The expansion and success of tele-medicine in Indian communities is linked to their economies as well. More jobs are needed to 

support health care and related technologies in a 21st century 

economy. These jobs require new skills and many of the skills 

needed to support tele-health are similar to those required to support community services, education and businesses. 

Moreover, the infrastructure that supports tele-health also supports video conferencing and online training, expanding access to 

education and advanced degrees. Investment in Internet infrastructure and bandwidth will produce positive results for both health 

care and economic growth in Indian communities. The IHS and its 

Tribal partners embrace innovation in health care delivery for Native communities. Health information technology holds great promise for our models of care in the expanded educational and ecoVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00028 Fmt 6633 Sfmt 6601 S:\DOCS\74030.TXT JACK
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1Trends in Indian Health, 2002–2003 Edition. Available at http://www.ihs.gov/

NonMedicalPrograms/IHSlstats/index.cfm?module=hqPubTrends03 2 Barnes, P. M., P. F. Adams, and E. Powell-Griner. Health Characteristics of the American 

Indian or Alaska Native Adult Population: United States, 2004–2008. National Health Statistics 

Reports 20. Hyattsville, MD: National Center for Health Statistics, 2010. 

nomic needs of the communities we serve. We look forward to the 

opportunity to work together to help reach this goal. 

Mr. Chairman, this concludes my testimony. I will be happy to 

answer any questions the Committee may have. 

[The prepared statement of Dr. Hays follows:]

PREPARED STATEMENT OF HOWARD HAYS, M.D., M.S.P.H., ACTING CHIEF

INFORMATION OFFICER, INDIAN HEALTH SERVICE, U.S. DEPARTMENT OF HEALTH

AND HUMAN SERVICES

Mr. Chairman and Members of the Committee: 

Good afternoon, I am Dr. Howard Hays, Acting Chief Information Officer for the 

Indian Health Service (IHS). I am pleased to have this opportunity to testify on the 

Indian health system’s use of health care technology innovation, and the potential 

for such innovation to improve access in Native communities to e-commerce, jobs, 

and the global marketplace. 

The IHS plays a unique role in the U.S. Department of Health and Human Services to meet the Federal trust responsibility to provide health care to American Indians and Alaska Natives. The IHS provides comprehensive health service delivery to 

1.9 million members of Federally-recognized American Indian and Alaska Native 

(AI/AN) Tribes through a system of Federal and Tribally operated health facilities 

and Urban health programs based on treaties, judicial determinations, and Acts of 

Congress. The mission of the agency is to raise the physical, mental, social, and 

spiritual health of AI/ANs to the highest level, in partnership with the population 

we serve. The agency aims to assure that comprehensive, culturally acceptable personal and public health services are available and accessible to the service population. Our foundation is to promote healthy AI/AN people, communities, and cultures, and to honor the inherent sovereign rights of Tribes. 

The IHS works in partnership with the Tribal governments and communities it 

serves and benefits from the guidance of local, regional and national Indian health 

boards in all aspects of the Indian health care delivery system. Additionally, under 

the Indian Self-Determination and Education Assistance Act (ISDEAA), many 

Tribes across the country have assumed full authority for all or part of health care 

delivery within their communities, including hospital operations. 

Access to Quality Healthcare 

Over the past 40 years, there have been many improvements in health status for 

American Indians and Alaska Natives. For example, mortality from unintentional 

injuries, homicides, alcohol-related deaths, and tuberculosis have significantly decreased. 1 Despite these improvements, disparities in access to care, preventable 

morbidity and mortality, and the burden of chronic disease persist. For example, the 

prevalence of heart disease and diabetes is considerably higher among AI/ANs compared with the rest of the U.S. population. 2 American Indians and Alaska Natives 

are also at higher risk for certain mental health disorders compared with other racial/ethnic groups. 

Such challenges make innovation a vital priority within Indian healthcare. Innovative processes and tools enable our care delivery system to adapt and help meet 

the changing needs of the communities we serve. National efforts, such as the Improving Patient Care initiative, exemplify the IHS’s commitment to performance improvement in health care delivery. This commitment is also demonstrated by the expanding use of health information technology. Health Information Technology (HIT) 

is a key category of innovation in health care; in Indian health, HIT supports and 

facilitates an array of activities focused on effective healthcare delivery and efficient 

resource management. In partnership with Tribes and Tribal programs, and with 

priorities set by the joint Tribal/Federal Information Systems Advisory Committee 

(ISAC), the IHS emphasizes the timely use of health information technology and delivery system innovation to address the preventive and treatment needs of our patients, families, and communities. While HIT innovation takes many forms, such as 

electronic health records, personal health records, and related information systems, 

I would like to speak today specifically about telehealth service delivery, an imporVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00029 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
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3 Hofstetter, P. J., J. Kokesh, A. S. Ferguson, and L. J. Hood. ‘‘The Impact of Telehealth on 

Wait Time for ENT Specialty Care.’’ Telemedicine and e-Health 16, no. 5 (2010): 551–56. 4Kokesh, J., A. S. Ferguson, and C. Patricoski. ‘‘The Alaska Experience Using Store-and-Forward Telemedicine for ENT Care in Alaska.’’ Otolaryngologic Clinics of North America in press. 5 Centers for Disease Control and Prevention. 2007 National Diabetes Fact Sheet. Available 

at http://www.cdc.gov/diabetes/pubs/estimates07.htm#4

tant example of the IHS emphasis on access and quality in our service delivery 

model. 

Telehealth Innovation 

Telehealth is an increasingly critical part of patient-centered care—within a community orientation and population health perspective. The diverse ‘‘toolkit’’ of telehealth includes real-time videoconferencing, ‘‘store-and-forward’’ consultation, remote patient monitoring, and ‘‘mHealth’’ or mobile health. These rapidly-evolving 

tools and capabilities enhance timely consultation, diagnosis, and treatment, supporting best practice approaches to care. They enable new models of quality service 

delivery, models that emphasize relationships and communication while facilitating 

improved health care quality, cost-effectiveness, and value. In the IHS, delivering 

the right care in the right place at the right time is a top priority. But telehealth 

permits two additional ‘‘rights’’: the use of right innovation tools in ways that promote the right patient-care team relationships. 

The use of telehealth is not new to Indian country. In the early 1970s, the IHS 

pioneered mobile telehealth service through the ‘‘Space Technology Applied to Rural 

Papago Advanced Health Care’’ (STARPAHC) project. A collaboration among the 

IHS, National Aeronautics and Space Administration, Health Education and Welfare, and the Papago (Tohono O’odham) Tribe, STARPAHC represented a novel use 

of leading edge technology and communications to provide mobile outreach to Tribal 

communities in southern Arizona. Over 25 years later, Indian health again demonstrated leadership in telehealth service delivery innovation, through the collaborative development of the Alaska Federal Health Care Access Network (AFHCAN) 

and the IHS Joslin Vison Network Tele-Ophthalmology Program. Both of these recent programs evidence the continued commitment to innovation within Indian 

health. Both have demonstrated the vital role of collaboration in service delivery. 

Both have also shown impressive results. 

Operational since 2001, the AFHCAN provides telehealth services to over 300 

Alaska villages and federal sites across Alaska. In the past decade, more than 

106,000 telehealth cases have been created within the Alaska Tribal Health System 

alone, for primary and specialty care. This secure system of timely ‘‘store-and-forward’’ consultation has improved access to quality care, reduced costs, and improved 

efficiency in measurable ways. For example, the use of tele-consultation via the 

AFHCAN telehealth solution has significantly reduced waiting times for Ear, Nose 

and Throat (ENT) specialist evaluations, decreasing the percentage of patients who 

wait 4 or more months for an ENT evaluation in one Alaska village community from 

48 percent, before telehealth, to less than 3 percent after telehealth began. 3 It has 

resulted in earlier diagnosis of treatable conditions and an improvement in specialist efficiency. 4 Almost 75 percent of tele-consultations at the Alaska Native Medical Center are now completed in one business day. The expanded us of telehealth 

in Alaska has increased access to health care while significantly decreasing patient 

related travel costs. Such savings create opportunities for additional care. 

Similarly, the IHS Joslin Vision Network (JVN) Tele-Ophthalmology Program has 

demonstrated impressive results. Diabetes is 2.2 times more prevalent among AI/

ANs than among the general U.S. population. 5 The IHS JVN solution is deployed 

throughout Indian country for the remote diagnosis and management of diabetic retinopathy, the leading cause of blindness in the United States. To date, the IHS JVN 

solution has been installed at 78 sites in 22 states, with additional communities 

served through a portable deployment strategy. Since the program’s inception, almost 50,000 patient examinations have been completed. Of note, in 2010, over 

10,000 patients with diabetes who had not previously received an annual retinal examination received such an examination. Published data documents both the diagnostic accuracy and cost-efficiency of this important innovation. 

Telehealth has been used in Indian health to support primary and specialty 

health care in over 30 clinical disciplines. Its utilization in Indian health continues 

to expand. Additional examples of care models undergoing change as a result of telehealth include:

• Behavioral health. Telehealth visits in behavioral health are growing at a significant rate across Indian health, with many Indian health facilities now relying on mental health and behavioral health service through telehealth. This 

27

service is providing access to care that was either previously unavailable or only 

available through significant travel and expense. The IHS Tele-Behavioral 

Health Center of Excellence in Albuquerque supports such behavioral health 

service expansion through direct care via videoconferencing, assistance with 

standards and operational specifications, and partnerships with expertise at the 

University of New Mexico Center for Rural and Community Behavioral Health 

and the University of Colorado Health Sciences Center.

• Chronic disease management. Through the Improving Patient Care initiative, 12 

IHS and Tribal facilities are piloting the use of home blood pressure monitoring, 

as part of a new model of care coordination for patients with diabetes and poorly controlled blood pressure.

• Nutrition. Over four years, tele-nutrition services from a single program office 

in Arizona have provided real-time medical nutrition therapy in over 1600 patient visits, in 6 Native communities, across 3 states—patients who otherwise 

would not have received such services. In addition, over 150 hours of nutrition 

training have been provided to community-based diabetes outreach workers and 

fitness instructors.

• Specialty services. Dermatology, cardiology, radiology, pharmacy, and many 

other services are increasingly provided via telehealth. One novel project involves remote neurosurgical consultation for head trauma. A collaboration between the IHS Navajo Area and the University of New Mexico Regional Trauma 

Center, this service has improved timely consultation for head trauma management to the Gallup Indian Medical Center, resulting in rapid and accurate evaluation of head injury and a significant decrease in unnecessary patient transfers.

Each year, an increasing number of IHS, Tribal, and Urban health facilities and 

programs gain using telehealth and related innovation. As noted, this experience 

spans many clinical disciplines. But it also supports educational and other health 

system needs. Of special note, telehealth tools facilitate new approaches to e-learning and training. Web-based tools, video-conferencing, and emerging capabilities via 

cellular and smart phones are revolutionizing access to medical information and 

training. Such capabilities hold significant promise for health education, health promotion and disease prevention, epidemiology and communicable disease tracking, 

social support, and human resource development. These tools are an increasingly 

important part of workforce development; on-line coursework permits many employees and community members to remain in their local communities. This avoids expensive travel, job displacement, and extended leave from or relocation of families. 

In addition, it facilitates leadership succession planning, allowing capable employees 

to remain in their jobs, within Indian health, while pursuing advanced degrees and 

training. 

Challenges 

Despite such successes, not all AI/AN communities benefit from emerging telehealth-enabled service models. Critical variation exists across Indian health regarding the availability of telehealth tools and the infrastructure to use them. Of note:

• Proven telehealth solutions, such as AFHCAN and JVN, are not available to all;

• Operational capacity for expanded implementation, training, and technical support is insufficient;

• Critical clinical and program support staff is limited;

• Diverse information systems require secure integration of patient health information;

• Network infrastructure requires upgrading;

• New mobile health capability demands updated security standards and policies; 

and

• Lagging insurance reimbursement policy for telehealth services constrains the 

ability of Indian health facilities to promote change.

These challenges result in variability in system capacities and the use of innovative tools. Such variability hampers the ability to expand regional successes into national models of care. The inability to develop such models of care restricts strategic 

use of innovation on a scale that can extend quality health care, public health support, and learning capacity to all AI/AN communities. 

Health Care Innovation and E-Commerce 

The IHS is committed to delivering the highest quality care to American Indians 

and Alaska Natives. Importantly, we recognize that the challenges and barriers to 

28

health care innovation are also challenges and barriers to other priorities in the 

communities we serve. And these other priorities—jobs, economic opportunity, safety and emergency services—are vital to personal health and a community’s health 

status. 

Investment in health information technology and telehealth capability may help 

address multiple priorities. In addition to enabling improved access to quality health 

care, telehealth tools can enable economic opportunity for Native communities as 

well. More jobs are needed in local communities to support health care needs in a 

21st century economy. These jobs require new skills; many of the skills needed to 

support telehealth are similar skills for other community services, schools and social 

services, and small businesses. As already noted, telehealth tools such as 

videoconferencing and on-line training can expand access to education and advanced 

degrees. Such training decreases unnecessary travel, saving money for communities 

and community members. It increases the ability of local hospitals and businesses 

to recruit and retain staff that otherwise may be required to leave communities to 

pursue their education and training. It aids Indian health in leadership succession 

planning. It even allows Tribal health programs to develop service models in which 

the expertise can be provided by those programs to other regions and geographies, 

rather than the often-experienced situation in which Native communities are dependent on expertise from specialty groups in urban environments. For example, 

some of the best experience in the U.S. in specialist tele-consultation lies within Indian health care. The opportunity to share such experience—across Indian health 

and with other health care organizations—may represent a strategic business opportunity for Tribal programs, one that could be realized if some of the already noted 

infrastructure requirements were addressed. 

A Dynamic Environment 

New technology such as the smart phone is changing our world. This change 

brings exciting opportunities for health care. It also drives reconsideration of service 

models, resource needs, and partnership possibilities. Technology innovation, of 

course, is only part of the answer. How the technology is used, what changes are 

needed to maximize that use, what service models best leverage new technological 

capabilities—these are the types of questions that necessitate careful review and resource support. It will also be important to identify the similarities and differences 

in how new infrastructure may support diverse community needs. For example, expanded broadband infrastructure will benefit many organizations and activities in 

Native American communities. New 3G and 4G cellular networks will enable health 

programs to extend care into patients’ homes. But security and privacy may mandate that the same health program’s telecommunication network be appropriately 

partitioned, rather than shared. Consequently, a total community requirement for 

broadband should be considered so that sufficient capacity can be obtained to meet 

collective needs, rather than a situation in which there is competition within Native 

communities for limited broadband capacity. 

Summary 

The IHS and its Tribal partners actively embrace the expanded use of innovation 

in health care delivery for Native communities. Health information technology, such 

as telehealth, holds great promise for our models of care and the expanded educational and economic needs of the communities we serve. The realization of this 

promise necessitates additional policy and resource assistance so that barriers to the 

appropriate use of such innovation may be reduced or eliminated. We look forward 

to the opportunity to work together to help reach this goal. 

Mr. Chairman this concludes my testimony. I will be happy to answer any questions the committee may have. Thank you for the opportunity to speak with you 

today.

The CHAIRMAN. Thank you very much, Dr. Hays. 

I know that some of my colleagues are limited in how long they 

will be able to stay for today’s hearing. So I am going to ask each 

of the witnesses on the first panel one question and then defer to 

my colleagues to ask their questions. If time permits, I will have 

a second round. Otherwise, I will submit additional questions in 

writing for the record. 

Mr. Blackwell, one of the major concerns that has been identified 

by tribes and by the General Accounting Office is the lack of accurate data about infrastructure in Indian Country. Is this something 

29

the FCC is aware of? And what are your recommendations for collecting such accurate data? 

Mr. BLACKWELL. Yes, Mr. Chairman, this is something we are 

aware of. Many of the tribes we met with, both here in Washington 

and in the field, have voiced their concerns about the accuracy and 

the depth of the data concerning the state of deployment of 

broadband on their lands. The Broadband Data Improvement Act 

and the State Broadband Data and Development Program are 

housed within the National Telecommunications Information Administration within the Department of Commerce. We have a 

memorandum of understanding, we have an MOU with them to 

provide technical assistance to them. 

We have coordinated with them in our office, the folks who are 

working on that mapping. In our office, we believe that through 

some targeted interagency coordination and including Tribal governments themselves, we can discuss that further, come to an understanding of where the tribes’ concerns are and perhaps begin to 

address some of those basic, underlying realities. 

The CHAIRMAN. Thank you. 

Dr. Hays, as you know, IHS provides health service delivery to 

565 federally-recognized tribes. Do all of these tribe have equal access to tele-medicine? If not, what is IHS doing to address this 

issue? 

Dr. HAYS. As I outlined in my statement, the access is an issue 

across many of these locations. The reasons for that may include 

infrastructure, the Internet infrastructure that is the subject of this 

hearing, as well as the availability of the staff to carry out and provide and coordinate these services. And one of the other barriers 

is the reimbursement policies that don’t actually allow for reimbursement for certain of the services. That makes it difficult for the 

programs to institute these types of services, if they can’t make the 

business case that they will be able to support the services through 

appropriate reimbursement policies. 

The various IHS programs are making information about these 

technologies available. Each program will determine, each location 

will determine what is most appropriate for the services that they 

deliver and will institute them as they are able to, given the limitations of the technologies and availability of services that exist. 

The CHAIRMAN. Thank you, Dr. Hays 

Senator Tester? 

Senator TESTER. Thank you, Mr. Chairman. Mr. Blackwell, we 

will start out. You tell me if this goal is what we are trying to 

achieve here, and that is to connect every household and every location in Indian Country. Is that where we want to head? 

Mr. BLACKWELL. That is certainly where the tribes want to head. 

That is what they are telling us. 

Senator TESTER. Okay. And I think that is a laudable goal, I 

think there are some real benefits in that. In Indian Country in 

Montana and I think in a lot of places throughout the Country, 

where you have a lot of unemployment, so you have situations 

where people have to decide between food, sometime medicine, absolutely heating in a place like Montana, transportation. These 

services don’t come for free. So even if the service is laid there, how 

30

are we going to address those kinds of issues? Have we thought 

that far ahead? 

I am not saying negative, what I am saying is, these are challenges that are real. And the Internet can offer some opportunities 

to stop the unemployment part of it, about jobs. So I just wondered, 

how does this maze of pieces line up in the end, do you see? 

Mr. BLACKWELL. That is a very good question. The extreme economic challenge of deploying such a capital-intensive critical infrastructure is different in every region of Indian Country. One of the 

things that has been a constant theme, and what the Commission 

has learned over the last 10 years, is that the inclusion of Tribal 

nations themselves into the model often gives a much greater 

chance of success of that model taking root. 

To draw upon what you have just said, one of the most eye-opening experiences I had several years ago was when I met the oldest 

Tribally owned and operated telephone company in the United 

States, the Cheyenne River Sioux Tribe Telephone Authority. Within their umbrella of companies is a propane company. And the reason why the Tribal government put that there is so that in winter, 

when the propane dollar is as important as the telephone dollar, 

as you alluded to, the company can deliver the propane and power 

the service to a lifeline level of assistance and then be able to keep 

the phone on and keep the propane flowing at the same time. 

Senator TESTER. Okay. Dr. Hays, let’s approach it from a health 

care standpoint. Health care professionals are hard to get in rural 

America, they are particularly hard to get in Indian Country. I am 

of the belief that with tele-health, you can deliver a product, it may 

not be as good as the eyeball to eyeball product, but in some cases 

it could be better, depending on the level of professionalism at the 

other end. 

Has IHS done any, and you guys are hard pressed for dough, I 

know that, because I hear about it regularly, life or limb, all that 

stuff. Has IHS done any sort of projecting on how much money, or 

how much further they could make the dollar work if there was 

good tele-health availability in many of the hospitals around the 

Country, particularly as it applies to Indian Country? 

Dr. HAYS. We have looked at the possibilities for tele-health expansion. I can’t say that we have a dollar figure tied to that, although we have looked at, because each program has to determine 

what is the best way to deliver the services that they have and 

which technologies they would have to use. We have spent some effort looking at what are the possibilities. But I am not aware of a 

dollar figure that we could apply to those technologies. There are 

a lot of possibilities there. We would be happy to provide more detail for the record if you would like. 

Senator TESTER. If you have them. I don’t want you to spend 

your lifetime doing them, but by the same token, I think there is 

an opportunity here to make the dollars go further in areas where 

we are in tight budget times. I know for a fact IHS never has 

enough money, for whatever reason. I also know for a fact that we 

can’t get health care professionals in many parts of rural America. 

In Indian Country, it is exponentially even worse. 

It would just seem to me that there is an opportunity here, once 

the infrastructure is built, that that pay-back could be pretty sigVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00034 Fmt 6633 Sfmt 6601 S:\DOCS\74030.TXT JACK
31

nificant through better health care and through better opportunities to have access to health care, particularly in Indian Country. 

That is just a little soap box stuff. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you very much, Senator Tester. 

Senator Franken, your questions? 

Senator FRANKEN. Thank you, Mr. Chairman. 

Mr. Blackwell, the Universal Service Fund currently provides 

funding to schools and libraries for Internet access. The Internet is 

obviously an incredible resource for students. And almost a necessary one right now. 

It is my understanding, however, that libraries in Tribal areas 

have had difficulty accessing these funds because of some States’ 

laws. What work has the FCC done and what work can Congress 

do to ensure that Tribal area libraries and schools have adequate 

Internet access? 

Mr. BLACKWELL. This is a matter we have heard about from certain parts of Indian Country for a few years. I was not completely 

aware that it was still an issue in certain places. One of the things 

we have done in the Office of Native Affairs and Policy is launch 

a comprehensive omnibus notice of inquiry into various issues. 

Through that vehicle, we possibly can take a look into this. But I 

do believe that our Wireland Competition Bureau [phonetically], in 

coordination with our Office of Native Affairs and Policy, we might 

be able to look more deeply into the issue and follow up with you 

and this Committee. 

Senator FRANKEN. Thank you. I would appreciate that. 

You wrote in your testimony, you didn’t do it here in your five 

minute pared down testimony, really a story that really struck me 

about witnessing a tele-medicine procedure in which a Native 

woman was told that she had cancer. And kind of struggling along 

with her, because of the bad hookup. The lack of speed and the 

flickering of the hookup, trying to read the doctors’ faces to see, 

along with her, to see how serious it was. 

Can you just describe that? This really brings a human, it really 

touched me, it brings a real, an actual human being and a real 

human emotion and a real human price to what this inferior kind 

of connectivity brings. Can you talk about that for just a moment? 

Mr. BLACKWELL. Yes, Senator, I can. I appreciate your question, 

because it helps me deliver on a promise that I made to her to 

bring that knowledge back to Washington. 

I had always heard about the generosity of the island people. I 

had never seen it to that extent. That really came true. On the island of Molokai, she asks if we could sit in on her oncology consultation. It was with Queens Hospital at Honolulu. It was during 

that consultation that she learned that she had a relapse. And the 

speed of the connectivity was not fast enough for us. One of the 

things I noticed was that we were all sort of leaning forward, looking at the three doctors at the other end of the line, trying to determine just how grave the look on their face was. 

And afterwards, she immediately began the treatment, but she 

asked for me to come back to the area where she was receiving 

treatment. I thanked her for that. I told her it was really a life experience. And I asked her if she had that experience as well, trouble reading the expression of her doctor. 

32

Senator FRANKEN. You were on the doctor’s end? Which end were 

you on? 

Mr. BLACKWELL. No, sir, I was sitting next to her on Molokai. 

And the doctors were in Honolulu. A plane flight away. And she 

agreed, she said that it was, but that it was better to have her husband by her side and to be able to talk about what was happening 

immediately rather than to have that knowledge and not be able 

to talk with him about it for two days before she returned home. 

So that genuinely was the human side of it 

Senator FRANKEN. Dr. Hays, this does show the human side of 

it. Are you guys coordinating, are Indian Health Service and the 

FCC coordinating to make sure that we optimize this so that telemedicine can come to Indian Country at the right speed, so that 

someone, when they are getting a diagnosis, can read the doctor’s 

face? 

Dr. HAYS. Yes. I have to say that the FCC has been very interested in working with us to understand the needs in the communities and to advocate on behalf of Indian Health Service being 

able to provide better connectivity and better services. So without 

question. 

Senator FRANKEN. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you very much, Senator Franken. 

Mr. Blackwell, earlier today the Chairman of the FCC unveiled 

a proposal to reform and modernize the Universal Service and to 

carry a conversation system. This brings to bear because of the 

question with Senator Franken on the Universal Service Fund. 

My question to you is, what is the FCC’s plan for including tribes 

in the Universal Service Fund? 

Mr. BLACKWELL. I appreciate your question. Modernizing the 

Universal Service Fund and the Intercarrier Compensation Process 

is critical to connecting consumers in Indian Country to 21st century broadband. We have heard many of the same concerns that 

you have heard in many meetings we have had on USF reform 

with Tribal governments and companies serving Native nations. 

Earlier today, the Chairman delivered remarks on proposed reforms. During his remarks, he designed the Connect America Goals 

Fund of ensuring universal availability of mobile broadband 

through a new mobility fund to extend deployment of the state of 

the art mobile broadband to more than 100,00 road miles. I would 

like to quote from his remarks. Actually, he brought a copy of them 

that I would like to submit to the record, because they are the most 

authoritative, hot off the presses, most recent. 

The CHAIRMAN. We will include it in the record. 

Mr. BLACKWELL. Thank you. The Chairman said, ‘‘This will begin 

with a one-time shot in the arm to accelerate deployment of 4G 

networks. Thereafter, the mobility fund will provide significant ongoing support for rural mobile broadband, which will include dedicated support for Tribal areas, where broadband and mobile services remain far behind the national average.’’

Mr. Chairman, a major part of our role in the Office of Native 

Affairs and Policy is to ensure that Native voices are heard and understood throughout the Commission on all of the rulemakings that 

impact them. We will ensure that these concerns and the views of 

Native communities are considered right up until the Commission 

33

makes a decision and promulgates rule and adopts an order in this 

important proceeding. 

The CHAIRMAN. Thank you. It is good to hear. 

Dr. Hays, a 2006 GAO report identifies the issue of inadequate 

data when it comes to telecommunication services in Native communities. The question is, does IHS have a data collection system 

for the tele-medicine programs? 

Dr. HAYS. My understanding, sir, was that that report had mostly to do with telephone service and that sort of thing. As far as 

ours, we collect data, we have the ability to collect data on the 

number of tele-health services that are provided in the context of 

patient care. So if the question is about our ability to know what 

services are being provided through tele-health, the answer to that 

is yes for the most part. 

In terms of our ability to know exactly where tele-health services 

are being delivered, we collect that through conversations and surveys of our areas and our facilities as opposed to data collection. 

The CHAIRMAN. Thank you. 

Are there any further questions? 

Senator TESTER. Yes, Mr. Chairman, if I might. 

The CHAIRMAN. Yes, Senator Tester. 

Senator TESTER. Thank you. I will start with Mr. Blackwell 

again. Through your consultations with the tribes, have you been 

able to determine what the priorities are, whether it is cell phone 

or Internet? 

Mr. BLACKWELL. It differs from tribe to tribe, Senator. Really, 

our office is working with every corner of the Commission possible 

to surface as many opportunities for tribes as they desire. That 

would include TV and radio, as well. 

Senator TESTER. Dr. Hays, kind of peeling off the question that 

the Chairman just asked you, if I heard you answer that correctly, 

you said that you know where the services are provided via telehealth, but you are uncertain what locations have tele-health? 

Dr. HAYS. No. What I intended to say there is that if a service 

is delivered through a tele-health method, and we are able to tell 

from looking at our electronic medical record if it was a tele-health 

service or not, so we can get some data on the number of individual 

service events that are tele-health. That is not universally true, but 

depending on the type of event. But in terms of the number of sites 

at which tele-health is being used, we don’t have a data base of 

that, but we aware through conversations with our areas and discussions with the tribes what types of services they are provdiing. 

Senator TESTER. The reason I asked that as one of my questions 

was, do you know how many sites you have tele-health opportunities. Obviously the answer to that is no? 

Dr. HAYS. I would almost argue that every site has tele-health 

opportunities in terms of the potential to use tele-health. 

Senator TESTER. But if they don’t have the broadband, they 

don’t. 

Dr. HAYS. It depends on the type of technology that you are describing. But the answer to that in general is yes. If there is no 

connectivity to the location, you are going to have trouble delivering tele-health services. 

34

Senator TESTER. Right. So what I kind of wanted to get an idea 

of, and you may or may not be able to answer this question, and 

if you can’t and you can later, I would love to hear the answers. 

I will even just go Montana-specific. How many of the clinics have 

tele-health capabilities? 

Dr. HAYS. There are several facilities in the Billings area in Montana that provide different types of tele-health services. For example, there are seven in the Billings area that actually provide telepsychiatry to the VA. 

Senator TESTER. How about in Indian Country? For instance 

Crow, or Northern Cheyenne? That is in the Billings area. 

Dr. HAYS. Exactly. 

Senator TESTER. If we had a Native American person go down to 

the clinic, and they had, let’s say they had a mental health issue, 

do they have capabilities to access that? I am not concerned about 

Missoula or Billings or Great Falls. But I am concerned about 

Browning, well, I am concerned about those, too, don’t get me 

wrong. But I am concerned more from a connectivity standpoint, 

what is going on in Arden and Browning and places where they 

have clinics. 

Dr. HAYS. Each clinic has different sorts of tele-health available. 

But I could provide more information in detail about them. But 

there are couple provdiing tele-nutrition, for example, others have 

access to tele-dermatology. It depends on what they have set up locally. 

Senator TESTER. I would love to, in just an overall kind of a 

snapshot of what is in the U.S. as far access, in Indian Country, 

on reservations. 

Dr. HAYS. Yes, sir, we will provide that. 

Senator TESTER. That would be great. Thank you very much, Mr. 

Chairman. 

The CHAIRMAN. Thank you very much, Senator Tester. 

Senator Murkowski, if you have any comments or questions to 

this panel, please proceed. 

STATEMENT OF HON. LISA MURKOWSKI,

U.S. SENATOR FROM ALASKA 

Senator MURKOWSKI. Thank you, Mr. Chairman. I appreciate the 

hearing and I apologize that I wasn’t here for your opening comments. 

Senator Tester, if you want to see great tele-medicine in action, 

I am going to invite you up to Alaska. We do some good thing up 

there, and we do it because of necessity. Without having roads that 

connect us, we figured out how to do some good things. 

But we are limited in our capacity to do that when you don’t 

have that broadband. So we need to work on that. But we have 

some good things going. 

Senator TESTER. Can I come up when the salmon are running? 

Senator MURKOWSKI. We will take you any time, and if you want 

to come with the salmon, we will show you where the best salmon 

are. 

Mr. Blackwell, I wanted to ask you a couple of questions, and 

this relates to the Universal Service Fund and the efforts within 

the FCC that propose reforming them. As you know, the Universal 

35

Service Administration company makes payments from a central 

fund to pay for programs like Lifeline, rural health care, schools 

and libraries and the high cost program. The high cost program is 

one where we basically work to ensure that reasonable rates for 

telecom services are comparable to customers in some of the urban 

areas. 

In Alaska, this is pretty important to us. We are primary beneficiary of the high cost program, as are many of the other rural 

areas. But for us, it is really pretty key. Without this funding for 

rural service providers, service rates for our sparsely populated remote areas I think would increase to levels that I don’t think would 

be acceptable. 

I am concerned that the FCC is there looking to reform that they 

have not adequately considered the unique situation that we face 

up there in Alaska, just very remote situations. I do understand 

that you have a report that will outline the FCC reform plan. I 

guess I am looking for some form of assurance here this afternoon 

that Alaska will not be disproportionately affected by these FCC reforms. If you can comment on that, and perhaps give me some kind 

of an assessment, if you will, or a preview of what these new reforms might look like. 

Mr. BLACKWELL. Senator, I can certainly appreciate your concern. This order is, circulation before the Commissioners is imminent, so I have to be careful here. But I can tell you that first, I 

will tell you that I will most certainly take your concerns to the 

Chairman and the Commissioners and make sure that what you 

have asked is heard by them. 

I can tell you through the Office of Native Affairs and Policy, we 

have met with several different folks from Alaska, across Alaska, 

different offices, the Alaska Telecom Association. We met with several rural telephone companies in Alaska that have Native ownership. We have also met with the governor’s office, personally went 

to a meeting of the Alaska Telecom Association. These are all meetings that our Office of Native Affairs and Policy has fostered. We 

have taken all the input that they have given us and put into the 

record in this matter as well. 

The Commission has had a longstanding, for a long time, has 

paid attention in the Universal Service content to Alaska. Upon occasion, we have been involved in things like the waivers of the 

after-hours e-rate rules for schools in Alaska, for community members to be able to use the connectivity after hours. So I can assure 

you that attention is being paid to Alaska. And I will do that again 

in follow-up. 

Senator MURKOWSKI. I appreciate that commitment. I do recognize that this is imminent, that it should be out very, very quickly. 

So you may be constrained. But I guess I do just want to have that 

assurance. And you have indicated that you have been looking at 

it for a long time and I appreciate that. But we are quite concerned 

about what that impact may be. So I appreciate your taking that 

back to the Commission. 

Is the FCC going to continue its commitment to help some of our 

mst disadvantaged Americans as it transforms the Universal Service Fund into this Connect America Fund? How do we maintain 

that commitment there? 

36

Mr. BLACKWELL. One of the things that the Chairman outlined 

earlier is that within the Connect America fund there will be a mobile Connect America fund. A portion of that will be dedicated to 

Tribal lands in the United States, including those Tribal lands 

within Alaska. That would be the first part of the mobility fund, 

it would be a one time disbursement. Then there would be ongoing, 

recurring, dedicated support for Tribal lands. 

Senator MURKOWSKI. So you are ensuring that throughout this 

process, we don’t drop the ball in terms of that commitment, then? 

Mr. BLACKWELL. Yes. 

Senator MURKOWSKI. Okay, good. 

Then just very quickly here, and I mentioned the high cost program and our concerns with that. Do you anticipate suffering much 

in terms of cuts to this high cost program? And I know it is difficult 

to try to forecast that, as we are all trying to figure out what is 

going on here with budget issues. Just give me your sense. 

Mr. BLACKWELL. I am not sure I would be able to do that, Senator, based on where the item stands right now. It is, circulation 

is imminent by the Chairman to the Commissioners for consideration of a vote on October 27th. 

Senator MURKOWSKI. Okay. I think, Mr. Chairman, that is all I 

have. I don’t have anything for Dr. Hays, but appreciate both of 

you gentlemen appearing in this hearing. And I appreciate you, Mr. 

Chairman, bringing it forward. Thank you. 

The CHAIRMAN. Thank you very much, Senator Murkowski. 

I want to thank this panel very much. You have been very informative. We have had some responses that we like, and there are 

others that we have to work on together on this. So I thank you 

again very much for your testimony and your responses. Thank 

you. 

I would like to invite the second panel to the witness table. Serving on our second panel is Mr. Lance Morgan, President and Chief 

Executive Officer of Ho-Chunk, Inc., located in Winnebago, Nebraska; Ms. Margo Gray-Proctor, the Board Chair of the National 

Center for American Indian Enterprise Development, located in 

Mesa, Arizona; and Mr. Michael J. Pollock, Managing Director of 

the Spectrum Gaming Group, located in Linwood, New Jersey. 

I want to welcome all of you here to this hearing. I would like 

to ask Mr. Morgan to please proceed with your testimony. 

STATEMENT OF LANCE G. MORGAN, CEO, HO–CHUNK, INC. 

Mr. MORGAN. Chairman Akaka, thank you for the opportunity to 

address the Senate Indian Affairs Committee. 

I have submitted written testimony that talks about several subjects, and I will just touch on a few of them. One of them is Internet access. We have Internet access on our reservation. Our issue 

is primarily cost-related and capacity. So it is a slightly different 

animal. 

The only story I will tell us that we get a bill from our phone 

company, and in it is an advertisement for the non-Indian communities, offering them the exact same service at 50 percent off. I 

think they were dumb enough to put it in our bill, too. 

37

Those are really our problems. As we grow as a company, we 

have to invest real dollars into that ourselves, because no one else 

will do that. And that is a real problem for us. 

We also run an e-commerce site called Indianz.com, which is primarily a news and information site. I told the story in the written 

testimony, but basically it is a pretty important news and information source in Indian Country. It has been instrumental in getting 

that out there. It is about 20,000 users a day, making it the largest 

Indian-oriented, Native America website 

But I want to spend the bulk of my time talking about the Internet in terms of the commerce aspect of it. First of all, the Internet 

has been an absolute boon for government contracting. I run now 

what is an international corporation from rural Nebraska. Cornfields surround us. We run the company through online services 

like HR, payroll, accounting, Internet, video conferencing. I was 

once on a video conference in my office in Nebraska with our housing company in Minnesota and they came in and kicked me off because there was an emergency with our office in Mexico City. So 

they switched over to that one. So that gives you some kind of 

sense of the issues that we face. 

In the government contracting arena, prior to the Internet, tribes 

didn’t have information. We didn’t have knowledge, we didn’t have 

access. We didn’t have the same abilities as large corporations and 

so we were relegated to the subcontractor arena, where a prime 

contract would get the contract and we would do some task on our 

reservation. If you travel the upper Midwest, it is littered with factories that used to do something and that are struggling to sort of 

be relevant in a modern economy. 

But in 1986, the Government did the Native 8(A) Act. Not much 

happened with that, really, until the Internet boom started in the 

late 1990s. That is when the information became equal. That is 

when our ability to access partners, to access information about 

contracts, to do the kinds of things that big companies had the advantage in before, that is when Tribal contracting actually took off. 

So the Internet actually has been a primary factor in the rise of 

Tribal contracting, which has had a lot of success in our world. I 

know there is some controversy about that, but I think that is another issue for another day. I have been here before on that subject. 

The bigger issue in my perspective, I spend time as a CEO and 

also as a lawyer. I run into the Internet quite a bit. I hadn’t 

thought about it until someone asked me to do this testimony. But 

the Internet is sort of an extension of the battleground that tribes 

face. Now, tribes have been fighting with States since they were 

called colonies, we have been fighting over control, we have been 

fighting over money, power, land, you name it. 

The States themselves have been held at bay lately. They were 

doing pretty good the first couple hundred years, but lately, tribes 

have sovereign immunity. We have been able to keep them away 

from us with that. So what the States do, is they developed a system of indirect control. They threatened those who deal with tribes. 

And tribes do not function in a vacuum, so they have to participate 

in the economy. But the States basically can figure out ways to 

move up the economic chain. 

38

But the Internet is fuzzy. You don’t quite know who is out there. 

You can’t stop it directly. And it has caused them some problems. 

The Internet tobacco issue was a major issue a few years ago. In 

that world, the attorney general of New York went to the FedEx 

and UPS and got them to quit shipping. He went to the credit card 

companies and got them to quit processing. There was no law 

against. He just threatened them and they did it. 

The Post Office didn’t bow to that sort of pressure and hence the 

PACT Act came in and stopped it. That is something new and very 

unusual for us, to see the outsourcing of Federal power to a State 

government causes us some concern, especially when they are dealing directly with us and they have such a poor track record. But 

it is their new play book. They can’t deal with us directly because 

of sovereign immunity. Indirectly they have problems because it is 

fuzzy on the Internet. And tribes are increasingly dealing with 

each other, and they each have sovereign immunity, and that protects each other. 

So now their next solution is to come to Congress and see if they 

can get you to pass something to hurt us. That is a problem for us, 

because tribes are geographically isolated. 

But the Internet levels the playing field in our world. In that 

world, it allows us to do things that are innovative. IT doesn’t have 

to be cigarettes, necessarily, but it could be insurance, it could be 

lending, it could be retail. It could be any sort of innovative thing 

that is out there. 

But what I am worried about is the States can come in, they 

want to control it, they want the money. I am worried that some 

little clever PR person will come up with some slogan, like in the 

PACT Act, we were supporting terrorists, of all things. And they 

will come up with some simple message and they will try to get it 

to you through Congress and take some control over us. We think 

that system probably needs to stop. 

I am going to read you the last couple of sentences from my written testimony in conclusion, because I want to be sure. This type 

of exploitation of tribes needed to be stopped a long time ago. But 

we have so many laws and legal precedents making it legal that 

we can’t unwind these anachronisms. But Congress has the power 

to prevent this same old system from reemerging in the new economy that is made by the Internet. 

I ask that you be vigilant in our defense as we struggle to 

emerge from the depths of generations of exploitation, control and 

poverty. 

Thank you very much. 

[The prepared statement of Mr. Morgan follows:]

PREPARED STATEMENT OF LANCE G. MORGAN, CEO, HO-CHUNK, INC. 

Introduction 

I am the CEO of Ho-Chunk, Inc., a successful Tribal economic development corporation. I am the managing partner of Fredericks, Peebles & Morgan, the largest 

law firm in the country that focuses exclusively on Tribal law, and in my spare time 

I teach Tribal economic policy and law at Arizona State University and the University of Arizona. I mention these jobs because I see the Internet from several perspectives in Indian Country. The Internet in Indian Country is several things. It allows 

my tribe to maintain an international corporation from a previously remote and 

rural location but at a higher relative cost than comparable regions. It also allows 

39

our website Indianz.com to disseminate Tribal news and information at a level and 

speed never seen before. More importantly it is an economic opportunity that is increasingly becoming a battleground over regulation and taxation. 

In this testimony I intend to discuss each issue, but I believe that the emerging 

battleground issue is by far the most important because it has the most potential 

for both growth and for conflict. 

Internet Access Cost 

A lot of the focus of federal resources has been on making sure Indian Country 

has access to the Internet. That is an important goal, but from my tribe’s perspective it is no longer a priority. Our tribe has Internet access from our local phone 

company. However, our economic growth is now constrained by the lack of Internet 

capacity in our community. Also our access costs are about 50 percent more than 

in nearby urban areas where competition is plentiful. Strangely our access is also 

more expensive than comparable non-Indian rural communities from our area. I actually have received advertisements in my Internet bill offering the exact same service at greatly reduced rates in neighboring non-Indian communities from our phone 

company. 

When we started Ho-Chunk, Inc. in 1994, we only had dial up. But when the local 

phone company refused our request to bring DSL service into our community, we 

brought high speed Internet to our company only by leasing lines and creating our 

own access. This potentially made us a competitor to the local rural phone company 

and then they almost immediately started offering DSL service. In a neighboring 

Native community where we have business operations, we basically promised to 

order twice as many lines as we needed to make the service worthwhile to install 

in that community. Now both communities have DSL service, but at higher than 

average rates. 

Since our initial push of the local phone company, we have developed dramatically 

and we severely strain the capacity of our current Internet service. We now have 

multiple T1 lines coming into our corporate headquarters and we beam the Internet 

access by microwave about 1000 yards to our other corporate facilities located in our 

newly developed community called the Ho-Chunk Village. The capacity of this system is now a serious growth constraint and has become an efficiency problem when 

running web based programs. 

We applied for a highly competitive rural innovations HUD grant to cover the cost 

of developing a fiber optic network for high speed Internet and a community wide 

Wi-Fi network. We did not receive the grant. We have now allocated $200,000 from 

our Tribal capital to the project, which strains our resources and takes away from 

other vital social and economic projects. However, we need to upgrade or risk becoming too inefficient to function, much less grow. 

Interestingly, the mere threat of the grant application was enough for the local 

phone company to dramatically reduce the tribe’s Internet access costs (Not HoChunk, Inc.’s), but they required a multi-year commitment, which I presume is intended to limit competition. The local price reduction for the tribe itself didn’t help 

the local home user lower their costs, but it does illustrate how competition in our 

environment can lead to better service and lower costs. 

One last example related to affordability. We provide guest access to some of our 

corporate facilities and it is not uncommon for people to be sitting in their cars 

using our wireless service outside our buildings. 

Indianz.com 

Ho-Chunk, Inc. also owns the Internet news and information site Indianz.com.

Indianz.com was started by three Native Americans in 1999 to aggregate news and 

information about all things Native American on the Internet. In 2000, Ho-Chunk, 

Inc. merged our e-commerce site Allnative.com with Indianz.com.

As part of our original partnership, all editorial and content is controlled by two 

of the original partners. Ho-Chunk, Inc. exercises no control over content because 

it was important to us that the site’s content not be encumbered by our economic 

or political interests. Despite now owning the entire company, the original employees still have absolute control over content and we intend to maintain that editorial 

independence. 

Indianz.com has experienced phenomenal growth and we believe it is the most 

visited and influential Native American oriented site on the Internet. It has 16 million hits per month, 5 million pages views a month and 20,000 unique visits a day. 

Its usage is too high to be hosted by our on-reservation servers, which are already 

capacity constrained. 

Indianz.com is used by most people as a quick reference tool to see the latest Native American issues. Indianz.com does some original reporting, but primarily offers 

40

a brief synopsis of existing articles and provides the link to the corresponding article. It also provides a very helpful list of previous articles on the same subject as 

reference and background information. 

Our goal was that Indianz.com would grow as a news and information site and 

Allnative.com would be a primary advertiser and Indianz.com’s success would drive 

Internet traffic to our ecommerce site. It worked phenomenally for 10 years. 

AllNative.com sold all things Native and distributed over 1 million catalogs over the 

last several years, but its primary product gradually became Native made tobacco 

products. This business was basically destroyed by the PACT Act, which prevented 

the mailing of Tribal tobacco products. Because the tobacco business was 

supplementing the other Native products business like jewelry, art and clothing, we 

completely shut down the products business 1 month after the PACT Act became 

effective. The shutdown hurt dozens of local and regional artists and craftspeople. 

It also put Indianz.com at risk financially. 

Indianz.com is not a large revenue generator for Ho-Chunk, Inc. Without the support of our ecommerce site, it is marginal from a purely financial perspective. Its 

primary revenue sources are now banner ads and job advertisements. 

Internally, Indianz.com is also viewed as a marketing tool for our other corporate 

and affiliated entities. However, it’s impact goes far beyond just the finances. I 

think its primary function has been to consolidate a fragmented news sector into 

one place where those interested in Native issues can quickly and easily survey the 

Native news world and that has a unique value and an important role in Indian 

Country. Information, knowledge and education are what we are now and our company considers that to be very valuable. 

Economic Opportunity and Risks 

The Internet has been a boon for Indian Country in several ways. Ho-Chunk, Inc. 

is headquartered in rural Nebraska, but we have operations in over a dozen states 

and in four foreign countries. We sell houses in Canada and work for the Federal 

Government in Mexico, Iraq and Afghanistan. All of our domestic and international 

operations are run from the Winnebago Tribe of Nebraska’s reservation. All of our 

primary offices are linked by email, web-based accounting and human resource programs, internal Intranets and video conferencing. While sitting in my office in Nebraska, I once got bumped out of a video conference with our sales team for our 

housing company in Northern Minnesota to deal with an emergency issue with our 

government contracting people in Mexico City. 

Government Contracting 

The Internet has made this kind of international company possible on the reservation. Prior to the Internet, a Tribal company wouldn’t have had the resources to 

compete with the reporting, financial, and human resource infrastructure of larger 

companies. The Internet has been especially valuable in the government contracting 

arena where partnerships are common and communication and rapid access to information is vital to success. 

The rise of SBA 8a program in Indian Country has been largely facilitated by the 

Internet. Without it, the large contractors would have all the access to information, 

contracting officers, and potential partners. It has allowed Tribal entities to be 

prime contractors. Prior to the Internet’s development, Tribal government contracting was largely sub contractor work where tribes would be assigned some low 

level task and largely left out of the higher end of the contract due to lack of contacts, lack of information and lack of knowledge. Now a Tribal company can use the 

Internet to have contract information delivered to them each day by email They can 

search for possible partners and advertise their skill sets and past performance on 

the Internet. 

Civil Regulatory Issues and State Control 

There is another area where tribes have used the Internet to develop their economies. They have passed laws to create civil regulatory advantages for economic gain. 

This is not an unusual economic development strategy. States pass laws creating 

varying rules, regulations and tax rates to attract capital and development all the 

time. Tribes have been largely prevented from doing this by powerful state interests 

being influenced by the desire for control, tax revenue or the economic interests of 

non-Tribal competitors. The legal system also has created dozens of exceptions allowing state incursion in our regulatory environment which prevents tribes from 

being too aggressive. Largely due to sovereign immunity, states cannot directly enforce their will upon tribes. Therefore, the states have evolved a system of indirect 

control. Under this indirect system, the states move the incidence of tax to off reservation entities. They regulate the non-Indian company and threaten it will civil 

or even criminal liability if they follow the Tribal law instead of the state. CompaVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00044 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
41

nies are forced to choose between which law to follow or which tax to pay. This can 

result in double taxation or more likely it will result in the reservation being the 

last place to be developed, if at all. Tribes are then forced to make the decision to 

have nothing or to ‘‘take what they can get.’’ This sort of exploitation and control 

is quite common and unfortunately considered quite legal under multiple U.S. Supreme Court opinions. 

The Internet has been the wild card in this nicely established system of state control. The players are not as defined and harder to directly influence by the states. 

Therefore, the state system of controlling tribes indirectly is not nearly as effective. 

Also, a growing number of Tribal companies are interacting with each other and 

typically will have sovereign immunity which further insulates them from state demands. 

Tribes have been establishing their own laws and legal systems outside of state 

control to create an economy. The Native Internet Tobacco business is one example 

of such a development. States wanted control over the tax and Master Settlement 

Agreement revenue, but had no direct way to stop the tribes from selling their products. The products were made on reservations and sold on reservations. All of this 

economic activity took place outside of state jurisdiction and often by Tribally owned 

entities with sovereign immunity. 

There is no limit to how far a state will go in this area. The Attorney General 

of New York, the now infamous Elliot Spitzer, threatened the credit card companies 

and they voluntarily quit processing Tribal credit card transactions. That didn’t stop 

the business so he then threatened UPS and Federal Express and they quit shipping our products. All of this happened without any law or legal case deciding this 

issue. When the U.S. Post Office refused to bow to pressure, the states worked with 

Congress to pass the PACT Act, which prevented the Post Office from shipping Tribal products. This effectively ended the Internet business and put thousands of Native Americans out of work and wiped out large portions of Tribal governments tax 

income. It is ironic to us that it is now almost illegal for us to make, tax and sell 

a product which was invented by tribes. 

Future Civil Regulatory Issues 

States are often highly regulated places. Tribes can now use their own powers to 

pass laws creating regulatory advantages in areas of taxation, insurance, lending, 

and others. The emerging Tribal Internet lending business is just another example 

of this type of growth. The states don’t like it, but they don’t have an easy indirect 

target to threaten, and thereby, isolate and control tribes. 

However, I am concerned because the states now have a new playbook. They requested the Federal Government to pass the PACT ACT giving them indirect control 

over tribes by making it illegal to ship Tribal products and I believe they will try 

this tactic again in other areas. This committee is well positioned to see these 

threats to Tribal economic and political sovereignty and has a responsibility to prevent this type of control from evolving again. 

In summary, the states use a vertical strategy to cut off tribes from the stream 

of commerce by simply moving up the economic chain and passing a law to threaten 

those who deal with tribes. The Internet has largely stumped this strategy. Now 

after their success with the PACT Act, they think they can go all the way to the 

top and have Congress pass laws giving them indirect power and control over tribes. 

This type of exploitation of tribes needed to be stopped a long time ago, but we have 

so many laws and legal precedents making it legal that we can’t unwind these 

anachronisms. But Congress has the power to prevent this same old system from 

reemerging in the new economy that is made possible by the Internet. I ask that 

you be vigilant in our defense as we struggle to emerge from the depths of generations of exploitation, control and poverty. 

Thank you for your consideration.

The CHAIRMAN. Thank you very much, Mr. Morgan, for your testimony. I just wanted to note that your full testimonies will be included in the record for all of the witnesses. 

Ms. Gray-Proctor, will you please proceed with your testimony? 

STATEMENT OF MARGO GRAY–PROCTOR, BOARD

CHAIRWOMAN, NATIONAL CENTER FOR AMERICAN INDIAN

ENTERPRISE DEVELOPMENT 

Ms. GRAY-PROCTOR. Chairman Akaka, I am Margo Gray-Proctor, 

President of Horizon Engineering Services Company in Tulsa, 

42

Oklahoma. I am a proud citizen of the Osage Nation and Board 

Chairwoman of the National Center for American Indian Enterprise Development. 

For the National Center and my company, trying to reach clients 

in Indian Country can be difficult and frustrating for us and for 

them. I couldn’t establish my business on the Osage Reservation in 

part because we needed access to better telecommunications and 

high speed Internet to transmit large files of engineering plans and 

grow our business locally and nationally. 

Indian Country has lagged far behind in modern deployment. 

And the digital divide gets wider every day. Without Internet access, according to the National Congress of American Indians, 

about 32 percent of Native Americans have no phone service and 

to echo what Geoffrey Blackwell had said, about 68 percent of the 

Tribal lands have only analog phone service. And only 10 percent 

penetration rate exists for fixed broadband infrastructure for high 

speed Internet access on Tribal lands, compared to a 95 percent 

rate for Americans living in urban areas. This 10 percent Internet 

penetration rate is appalling. 

High speed Internet access is the key to the National Center’s 

work, and it is essential to Tribal self-sufficiency and self-determination. 

The lack of access, especially to Internet service, remains the 

major obstacle to economic growth, job creation and prosperity in 

Indian Country. Without Internet access, Native entrepreneurs and 

businesses can’t reach local, regional, national and global markets. 

They can’t search for jobs or business opportunities. They can’t access SBA’s online entrepreneurial tool kit to learn how to even 

start a business. They can’t create a website, they can’t introduce 

themselves, market and sell their products and services, or advertise for job opportunities. They are basically invisible. 

They can’t complete registration forms required to sell to government agencies or find out contract opportunities or be paid if they 

do sell to the U.S. Government. 

The National Center has served as the longest-serving national 

Native business assistance provider in the U.S. Last year alone, 

the National Service served 5,567 clients. That helped create over 

1,300 jobs and win over $240 million in contracts. And all the other 

economic activity that we created through our events, over the last 

decade, we helped Native companies generate $6.3 billion in contract awards and financing. 

If Native businesses were proportionate to that size, the Native 

population in the U.S., their gross receipts, would exceed $160 billion. That level of business activity could be achieved if all Native 

entrepreneurs and businesses had access to the high speed Internet. The National Center stands ready to make this happen 

through its soon to be 12 centers nationwide. 

We launched our national Native teaming alliance this year. Recently, we are launching the Native American Global Trade Center, 

which will be in Milwaukee. 

Here are some examples of how the Internet access has helped 

National Center clients further their business development. Chickasaw Nation’s high speed Internet access has supported enormous 

growth of its government contracting operations and its interVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00046 Fmt 6633 Sfmt 6601 S:\DOCS\74030.TXT JACK
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national sales of chocolates. Tulalip Tribes used Federal stimulus 

funds to bring high speed Internet to five tribes, reservations and 

rural communities in Washington State to connect locally, nationally, globally through web-based businesses and video conference. 

Red Lake Band launched seven businesses on its reservation due 

to having high speed Internet access. The Coeur d’Alene Tribe in 

Idaho launched its own Internet service provider with broadband 

towers across its reservation to power its government contracting 

and other enterprises. Now it is bringing Internet access by fiber 

optic cable to every home on the reservation. 

But there still are big gaps. One area where the Federal trust 

responsibility has not been fulfilled, and its allocation of the Universal Service Fund fees, to where we are desperately needed, substantially under-served Tribal areas. This fund contains billions of 

dollars collected on an ongoing basis. There is no good reason not 

to dedicate some of this money to finance deployment of broadband 

and Internet infrastructure to under-served areas and other pats of 

the Country. 

By dedicating a portion of these collected fees, this will spur 

Tribal and other Native business development, the FCC can meet 

its Federal trust obligations, foster sovereign solutions for job creation and economic growth. The Congress can also act to enhance 

adequate fund Internet infrastructure deployment to improve Internet service in Indian Country. The National Center just approved 

a policy agenda, and it is attached to my written statement. 

These are just a few of our recommendations to support a full 

broadband Internet telecommunication access in Indian Country. 

To encourage more collaboration amongst the Federal agencies responsible for broadband policies and funding Internet infrastructure deployment. Collect more current data on Internet penetration 

in Indian Country, so that precious Federal funding can be better 

targeted to areas most in need of the Internet access. 

Lastly, we are asking for the prompt enactment of the Carcieri 

fix, to minimize further barriers to Tribal land acquisition for 

Internet infrastructure, energy manufacturing, and other economic 

development. We also ask that there would be developed the Farm 

Bill amendments and the Indian Country Internet access, beef up 

USDA’s Office of Tribal Affairs, create a Native liaison in RUS to 

coordinate outreach and technical assistance for tribes on Internet 

infrastructure deployment, and apply for the SUTA provisions to 

all USDA programs and authorizing specific amounts for SUTA appropriations. 

Thank you. 

[The prepared statement of Ms. Gray-Proctor follows:]

PREPARED STATEMENT OF MARGO GRAY-PROCTOR, BOARD CHAIRWOMAN, NATIONAL

CENTER FOR AMERICAN INDIAN ENTERPRISE DEVELOPMENT

I. Introduction 

Chairman Akaka and Ranking Member Barasso, the National Center for American Indian Enterprise Development (the ‘‘National Center’’ or ‘‘NCAIED’’) commends the Senate Committee on Indian Affairs for convening this important oversight hearing on ‘‘Internet Infrastructure in Native Communities: Equal Access to 

E-Commerce, Jobs and the Global Marketplace.’’ I am Margo Gray Proctor, President of Horizon Engineering Services Company in Tulsa, Oklahoma, and a proud 

44

citizen of the Osage Nation. I present this testimony today on behalf of the National 

Center’s Board of Directors, which I chair. 

From my experience with the National Center, and as a business owner, I know 

that trying to reach clients and potential clients in Indian Country can be an enormous, frustrating challenge—for us and for them. I moved my own business from 

rural Pawhuska, Oklahoma in part because we needed access to better telecommunications and high speed Internet service essential to transmitting large files 

of engineering plans, and growing our business locally and nationally. 

First Americans traded amongst each other long before foreigners settled on Tribal communities’ productive lands and federal treaties reduced Tribal lands to more 

remote areas in exchange for promises of federal protection and support. For centuries since, Indian Country has lagged far behind modern development, and the 

‘‘Digital Divide’’ gets wider by the day without Internet access. According to the National Congress of American Indians (NCAI), about 32 percent of Native Americans 

have no phone service, about 68 percent of Tribal lands have only analog phone 

service, and only a 10 percent penetration rate exists for fixed broadband infrastructure for high speed Internet access on Tribal lands, compared to a 95 percent rate 

for Americans living in housing units with such broadband access. 

Dial-up Internet transmissions take forever, get interrupted easily, and cannot 

transfer documents reliably. Frustration, not business, gets generated. A 10 percent 

Internet penetration rate is appalling when high speed Internet access is so critical 

to Tribal self-sufficiency and self-determination. 

President Obama highlighted broadband as a key component of his plan for ‘‘winning the future’’ and accelerated broadband deployment through the American Reinvestment and Recovery Act. Continued emphasis on high speed Internet access is 

essential to the President’s plan and to the National Center’s mission of business 

development and job creation in Indian Country. 

II. Background on the National Center 

The National Center, organized over 42 years ago, is the longest serving Native 

American business development assistance provider in the United States. It is a national organization, governed by a Native Board of Directors who are leaders in 

their fields. The National Center’s mission to promote and advocate commerce for 

Tribal and private Native businesses, and its vision is American Indian self-sufficiency by leading economic development and promoting commerce in Indian Country. In the past year alone, the National Center served 5,567 clients, helped retain 

or create over 1,300 jobs, win $120 million in contracts, and produce another $120 

million in economic activity. Over the last decade, the National Center’s bid matching at RES and other business assistance activities have helped companies generate 

at least $6.3 billion in contract awards and financings. 

The National Center operates a national network of non-profit centers in Arizona, 

California, Washington (covering Idaho and Oregon), Virginia, Georgia, Mississippi, 

New Mexico, and soon will open offices in Alaska and Wisconsin. These centers assist clients ranging from first generation Native entrepreneurs to sophisticated Tribal enterprises in developing business feasibility studies, business plans, banking relationships and lines of credit, marketing, growth strategies, procurement technical 

assistance, and assistance in lining up financing and bonding. Our federal partners 

include the Department of Commerce’s Minority Business Development Agency 

(MBDA) and the Defense Logistics Agency, and we help them fulfill their missions 

by: providing business development assistance; coaching contractors on completing 

applications for certifications and registrations; finding capable Native companies to 

fulfill federal requirements; and providing contractors guidance on programs administered by various federal, state or Tribal agencies, including financing, contracting, 

bonding, certifications and teaming programs. The National Center’s primary private sector partners serve on its National Resource Council, composed of many Fortune 500 corporations, other major companies, Native-owned enterprises and Alaska 

Native corporations from many different industry sectors. The Resource Council 

members help support National Center operations and offer potential teaming opportunities for the smaller companies we assist in government and commercial contracting. 

Earlier this year, the National Center completed a strategic restructuring process 

in order to reach additional opportunities for Native business, commerce and economic development. We are launching a membership program with its own registered trademark, Native-to-Native (N2N®), to strengthen our national network of 

partners and increase contracting and retail opportunities for Native businesses nationwide and globally. Soon, the National Center will establish a new Native American Global Trade Center in the Midwest that will become a hub involved in building a new national database of Native businesses and products, developing a Tribal 

45

International Trade Manual, identifying international trade opportunities for clients 

to export their products, and coordinating international trade missions for member 

businesses. Recent award of a major Small Business Teaming grant from the Small 

Business Administration (SBA) will enable the National Center to increase its Midwest presence with two National Center Teaming Alliance offices and another elsewhere, for a total of 12 offices nationwide. 

The National Center also produces various national and regional events that 

train, promote and market Native enterprises to the public and private sectors. Its 

premier annual national event is the phenomenally successful Reservation Economic 

Summit & American Indian Business Trade Fair (‘‘RES’’), the largest and longest 

running American Indian Business Conference and Trade Show in the country. A 

noteworthy feature of the conference is the ‘‘Procurement Pavilion,’’ the Nation’s 

largest business matchmaking event for Native owned businesses. At RES 2011, 

nearly 3,000 individuals and 400 exhibiters attended, including tribes, ANCs, Native 

enterprises, Fortune 500 and other major corporate representatives as well as federal, state, local and Tribal political and procurement officials. Trade delegations 

from Canada, Turkey and China also attended. The RES 2011 Procurement Pavilion 

featured 111 buyer tables, with 142 buyers representing 97 buying organizations, 

including federal, state, and Tribal governments, large prime contractors. Leading 

the charge in promoting N2N business relationships, the National Center has encouraged purchasing decision-makers of Tribal governments, Tribally owned businesses, ANCs, and large individually-owned Native companies to utilize Native 

American, minority, and other small businesses for their purchasing requirements. 

Every year, more Native-owned companies and entrepreneurs are participating as 

‘‘Buyers’’ in the RES Procurement Pavilion to find Native- and minority-owned businesses as subcontractors. 

Over the years, the National Center estimates that its operations have assisted 

over 480 Indian tribes and more than 25,000 Native enterprises, and have trained 

over 10,000 Tribal members in various aspects of business development. Its success 

rate—helping to generate over $6.3 billion in contract awards and financings in recent years—jumped significantly with high speed Internet. 

III. ‘‘Access’’ Challenges to Native Business Development 

Estimates place the total American Indian/Alaska Native (AI/AN) population at 

4.12 million (1.5 percent of the total U.S. population), with the highest proportion 

of all AI/AN residents in Alaska (19 percent), Oklahoma (11 percent), followed by 

California, Arizona, Texas and New Mexico. Lack of access to jobs and tools for business and economic growth is a monumental challenge. 

Disproportionately High Unemployment 

Always higher than for non-Native individuals, the unemployment rates for AI/

AN are disproportionately greater in certain regions. A 2010 Economic Policy Institute study reported that, between 2007 and 2010, the AI unemployment rate doubled (7.7 percent to 15.2 percent, 1.6 times more than the non-Native increase) and 

the AN unemployment rate more than tripled (6.3 percent to 21.3 percent). Regional 

AI/AN unemployment rates were highest in Alaska, the Midwest and Northern 

Plains regions. 

Regional Disparities in Business Growth 

The above regions also posted the fewest Native-owned businesses. The U.S. Census Bureau’s latest Survey of Business Owners (2002–2007) showed growth in the 

number of Native-owned non-farm businesses up to 236,967 (up17.7 percent over 

the previous 5 years), employing 184,416 people and generating $34.4 billion in receipts. This Census Survey, taken before the 2008 recession, did not include any 

Tribal-owned businesses. Regions with the largest number of Native businesses 

were California (13 percent), Oklahoma (8.9 percent) and Texas (8 percent), areas 

with benefits conducive to business growth, including much greater Internet access, 

transportation options, infrastructure support, and ample domestic and international business opportunities. 

Significant Internet and Other Access Problems Persist 

Lack of access to Internet service, transportation, infrastructure and financing of 

all sorts (lending, equity investments, surety bonding, bond financing, etc.) remains 

the major obstacle to growth, job creation and prosperity in Indian Country. Not 

surprising, the regions with the fewest Native-owned businesses, and highest AI/AN 

unemployment, are those with the largest expanse of rural or remote areas and 

least access to Internet/telecommunications service, adequate transportation, and infrastructure. According to the National Congress of American Indians (NCAI), while 

98 percent of Americans have access to telephone service, an estimated 32 percent 

46

of AI/AN have none, with analog telephone penetration rates on Tribal lands at only 

67.9 percent. NCAI reports even greater disparity in Internet access on Tribal lands, 

with less than 10 percent penetration compared to 95 percent of Americans living 

in housing units with access to fixed broadband infrastructure. As to transportation, 

Indian reservation roads comprise over 104,000 miles of public roads needing improvements (over 65 percent are unimproved earth and gravel) and 24 percent of 

the bridges are deficient. Poor access to transportation and financing hampers 

tribes’ ability to develop their energy and other natural resources that their Indian 

lands may bear. And, access to capital never seems to improve; in 2001, the Department of Treasury estimated $44 billion in unmet capital needs in Indian Country 

and that figure surely has spiked with the economic downturn since 2008. 

Importance of Internet Access to E-Commerce, Jobs and the Global Marketplace 

Internet access makes business progress and success possible in Native, national 

and global marketplaces. Broadband serves as the engine to overtake and seize the 

opportunities in these markets. The Internet facilitates conducting business, or 

learning how. Companies introduce and market themselves through their websites. 

They sell products and services, and advertise job opportunities, online. If you are 

searching and applying for jobs, learning how to start a business, seeking financing, 

trying to sell to the government, or registering for classes or conferences, you have 

to use the Internet. Nowadays, government contracting depends almost entirely on 

Internet access. To sell to the Federal Government, you must register electronically 

with US Federal Contractor Registration. Central Contractor Registration (CCR) enables a company to learn about federal contract opportunities and to be paid online 

for products and services procured. Companies apply online for various preference 

programs and certifications to do business with federal, state and Tribal government 

agencies. 

Both the Obama Administration and the Congress recognize that developing new 

small businesses is vital to both Indian Country and the national economy, and 

growth potential lies in access to high speed Internet access. The SBA website 

shows that small firms represent 99.7 percent of all employer firms, employ over 

half of all private sector employees, and have combined payrolls making up 44 percent of the total U.S. private payroll. An estimated 3.5 percent of the adult population starts a business each year, according to the Kauffman Index of Entrepreneurial Activity: National Report 1996–2005. AI/AN businesses make up the smallest group of small businesses, however. These businesses can generate impressive 

economic output in the U.S. economy, an estimated $34.4 billion from 2002–2007, 

according to the U.S. Census Bureau, 2007 Survey of Business Owners. The MBDA 

projects that if AI/AN businesses were proportionately represented in the U.S. economy, their gross receipts would exceed $160 billion! That level of business activity 

could be achieved if all Native entrepreneurs and businesses had adequate access to 

high speed Internet service.

The above figures reiterate the importance of public and private sector initiatives 

that promote Native and other small businesses’ success. For example, both the SBA 

and the MBDA websites provide access to substantial amounts of information valuable to small businesses, and SBA’s website hosts some great tools and online 

trainings on how to start and operate a business. All the federal contracting agencies, and Fed.Biz.Opps, provide countless opportunities for small business. Without 

Internet access, however, Native entrepreneurs cannot go online to SBA’s Entrepreneurial Tool Box to learn how to start a business. They cannot register with CCR, 

or sell products or services in more than their local marketplace. 

National Center Experiences with Internet Access 

The National Center’s Board of Directors recognizes the importance of Internet access to Native business development, based on our personal experiences. For example:

• Board member, Karlene Hunter founded Lakota Express on the Pine Ridge Reservation where the poverty and unemployment rates exceed most in the United 

States. In the mid 1990s, Lakota Express wanted to open a call center and direct mail operations, but its commercial business purpose could not qualify for 

access to the reservation’s communication lines dedicated to the Tribal government and the Tribal college. With the help of then Senator Tom Daschle, the 

company was able to bring in its own T–1 lines for voice and data transmission 

to make calls and send and receive printed documents. Soon 26 new full-time 

and 30 part-time jobs were created for Tribal and non-Tribal members.

• Board member, Michelle Holiday, just visited Navajo Nation in New Mexico and 

could not get service to use her cell, or email, to reach a Tribal employee at 

Tohajiilee (formerly known as Canoncito). At Navajo, about 60 percent of resiVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00050 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
47

dents lack basic telephone service, and limited Internet service is dial-up only. 

Soon that situation will change, however, because Navajo Nation Telecommunications Regulatory Commission has received a $32.2 million grant from the National Telecommunications and Information Service (NTIA) to achieve 4G 

connectivity throughout the vast reservation within the next two years. The private match was $13.8 million. The Navajo Tribal Utility Authority will be deploying 550 miles of new aerial fiber-optic cable and 59 new or modified microwave towers covering 15,000 square miles in Arizona, Utah and New Mexico. 

This job-creating project, once completed, will bring broadband Internet service 

to about 30,000 households, 1,000 businesses, and 1,100 institutions located 

across Navajo Nation.

National Center clients’ experiences also offer some good examples of how essential Internet access is to Tribal business development:

• Chickasaw Nation has built a powerhouse of successful businesses in a variety 

of industry sectors. The National Center is especially proud of its client, Chickasaw Nation Industries, one of the leading government contracting operations. 

Not only is its high speed Internet access essential to its government contracting (as explained earlier), but it has made possible extraordinary international commercial sales of its company that produces Bedre’ Fine Chocolates.

• The Tulalip Tribes also have been leaders in business and economic development, often in partnership with the National Center. Our centers have helped 

them find Native subcontractors for Tribal construction projects, and they have 

hosted many of our Native American Procurement Conferences over the years. 

In 2009, the Tulalips used federal stimulus funds to bring high-speed Internet 

to five other tribes’ reservations and rural communities in Washington State—

communities that have largely been ignored by cable or telecommunications 

companies. They connected their broadband network to a Seattle-based exchange that gave them a cheaper and faster Internet connection, and generated 

technology jobs. The Tulalips created a nonprofit cooperative and applied $12 

million to push that network into remote parts of the state that have been beyond the reach of broadband. The new Internet access will allow all these tribes 

and rural communities to connect to each other and to areas across the country 

and the globe, and will foster web-based businesses, videoconferencing and 

other technologies.

• The Red Lake Band of Chippewa Indians of Minnesota launched 7 businesses 

on its reservation because they were able to arrange high speed Internet access.

• The Coeur d’Alene Tribe in Idaho launched its own Internet service provider 

with broadband towers across its reservation to power its government contracting and other enterprises. Now the Tribe is bringing Internet access by 

fiber optic cable to every home on the reservation.

The Internet is essential to the National Center as well as to the Native entrepreneurs and businesses we advise on technology tools and assist in navigating web 

portals, electronic application procedures, and E-Commerce sites. As a special webbased tool, the National Center is embarking on a major upgrade of NativeEdge, 

a webportal dedicated to Native American Indian business development. NativeEdge 

was designed to facilitate the attainment of sustainable economic development within Native communities. The website houses a comprehensive inventory of resources, 

information and guidance for Native entrepreneurs, tribes and Tribal entities to promote economic growth in Indian Country. The National Center is enhancing the 

NativeEdge web portal to be fully interactive, with access to a user-friendly search 

engine, so that users can define their interests and the type of assistance they seek 

by registering through an online form. NativeEdge will include the following database management system components:

• Native American Jobs—Career-minded Native Americans can search the job 

database for employment opportunities on a nationwide basis. Tribes, Native 

businesses, corporations, and government entities seeking a diverse employee 

base can post their open positions here.

• Bid Opportunities—Native American suppliers, and buyers looking for them, 

can post bids, RFPs and contracting opportunities here at no cost. New customers, vendors and suppliers can be found, and registered users can search the 

on-line database for available bid opportunities on a nationwide basis.

• National Center Teaming Alliance—The site will be augmented with additional 

services made possible through the Small Business Teaming Pilot Program so 

that small businesses will be able to create partnerships with other small and 

48

larger businesses to pursue larger contracts, bid opportunities and procurements.

To make NativeEdge truly helpful to Indian Country, obviously all of its potential 

users must have access to the Internet. 

Efforts to Improve Internet Infrastructure Deployment in Indian Country 

The Federal Government has made strides in recent years to increase Internet infrastructure deployment in Native communities, especially with the Recovery Act’s 

infusion of funds for broadband deployment through programs of the NTIA, U.S. Department of Agriculture (USDA), and Federal Communications Commission (FCC). 

These federal agencies should be commended for their hard work in expending wisely and rapidly all the broadband resources made available through the Recovery 

Act. In addition, they have redoubled efforts pursuant to Executive Order 13175 to 

conduct Tribal consultations and implement new Tribal Consultation Policies. All 

three agencies have increased their outreach to Indian Country to explain how to 

apply for available grant and loan programs so as to deploy broadband and telecommunications infrastructure and high speed Internet service to Tribal communities and Native businesses. The National Center especially commends Chickasaw 

Nation Tribal member Geoffrey Blackwell for his extraordinary leadership in this 

field, from his service at the FCC during the Clinton Administration, and his 

heightened position in the Obama Administration as the FCC’s Chief of Native Affairs and Policy, Consumer and Governmental Affairs Bureau. 

The National Center has facilitated several of these outreach efforts by hosting 

training sessions, roundtable discussions and consultations at our annual RES conferences. RES 2004 featured a major presentation on ‘‘Indian America—Building 

Economies through Diversification, Tourism and Technology’’ by the FCC’s Wireless 

Telecommunications Bureau Chief. RES 2010 featured a training session on ‘‘Federal Programs to Develop Broadband Infrastructure in Indian Country’’ that promoted USDA’s Broadband Initiatives Program and NTIA’s Broadband Technology 

Opportunities Program (BTOP). Also at RES 2010, USDA’s Rural Utilities Service 

(RUS) conducted a Tribal consultation and listening session on the ‘‘Substantially 

Underserved Trust Areas’’ (SUTA) provisions of the 2008 Farm Bill designed to increase broadband deployment on Tribal reservations. At RES 2011, FCC and USDA 

officials conducted a learning session on ‘‘Broadband Opportunities Enhancing Native Economic Development’’ and the FCC conducted Tribal consultations on 

‘‘Broadband Rollout in Indian Country.’’

The Recovery Act made major contributions to broadband deployment with over 

$4 billion for NTIA’s BTOP grants and over $3.4 billion for RUS’ broadband infrastructure projects. Six Tribal telcom authorities received BTOP grants for infrastructure and public computer projects, and an estimated 65 BTOP projects will 

benefit Tribal communities. RUS awards benefitted 31 Tribal communities. Still, it 

is important to note that both agencies received far more applications than they 

could fund (outstripping BTOP’s available funds tenfold!) As reported in the preamble to RUS’ March 14, 2011 Interim Rule on Rural Broadband, USDA’s Economic 

Research Service analysis concluded that broadband investment in rural areas 

yields significant economic and socio-economic gains:

Analysis suggests that rural economies benefit generally from broadband availability. In comparing counties that had broadband access relatively early (by 

2000) with similarly situated counties that had little or no broadband access as 

of 2000, employment growth was higher and nonfarm private earnings greater 

in counties with a longer history of broadband activity. By 2007, most households (82 percent) with in-home Internet access had a broadband 

connection... however... only 70 percent of rural households with inhome Internet access had a broadband connection...

Most employment growth in the U.S. over the last several decades has been in 

the service sector, a sector especially conducive for broadband applications. 

Broadband allows rural areas to compete for low- and high-end service jobs, 

from call centers to software development... Rural businesses have been 

adopting more e-commerce and Internet practices, improving efficiency and expanding market reach... [B]roadband is a key to economic growth. For rural 

businesses, broadband gives access to national and international markets and 

enables new, small, and home-based businesses to thrive.

Since FY 2002, RUS’s Tribal Community Connect Grants, Rural Broadband Loan 

Program and Telecommunications Infrastructure Loan Program have benefitted 

many Tribal communities, Tribal enterprises and Tribal members’ businesses with 

access to telecommunications and Internet service to conduct their business transVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00052 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
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actions. Many of these Tribal enterprises and Native businesses have been or become National Center clients. Several National Center Board members have witnessed broadband deployment in their own Tribal communities (Navajo, Laguna, 

and Hopi). The new SUTA provisions give the RUS’ Administrator flexibility to facilitate even more Rural Broadband deployment by making available financing with 

interest rates as low as 2 percent with extended repayment terms, waiving anti-duplication provisions and matching fund and equity requirements, and giving highest 

priority to designated projects in substantially underserved trust areas. RUS plans 

to expand SUTA’s application in additional rules now being developed. 

One area where the federal trust responsibility has NOT been fulfilled is in the 

allocation of Universal Service Fund fees to where they are desperately needed—

substantially underserved Tribal areas. This Fund contains billions of dollars collected on an ongoing basis. There is no good reason not to dedicate some of this 

money to finance deployment of broadband and other Internet infrastructure in underserved Tribal areas and other parts of Indian Country. Tribal members should 

not be counted as just additional users of a non-Tribal communications system. 

Service solutions must work for both the end-users and the operator with a business 

model sympathetic to Native concerns, especially when a tribe is the operator. A setaside should be created to fund service to substantially underserved Tribal areas. 

By dedicating a portion of the collected fees, as well as some spectrum, to spur Tribal and other Native business development, the FCC can meet its federal trust obligations and foster sovereign solutions for job creation and economic growth. 

The United Nations recently pronounced recently that access to the Internet is 

a basic human right, as it facilitates civic engagement, assists economic development initiatives, promotes long distance learning and telemedicine, and serves as 

an invaluable source of information. The Obama Administration has acted accordingly through its Tribal Consultations Policies and continues to implement its Internet related initiatives and rules as quickly as possible. The Congress also must rise 

to the occasion and do its part to enhance and adequately fund programs to increase 

Internet infrastructure deployment and improve Internet service to the many Native 

communities where it is long overdue. 

VI. Specific Recommendations for Improvements 

The National Center’s recently released Native Business and Economic Development Policy Agency (attached to this testimony) lists all of our top public policy priorities. Outlined below are some specific recommendations for this Committee and 

others on ways to expand Internet infrastructure and facilitate E-Commerce and job 

creation in our Native communities. 

A. Support Full Broadband and Telecommunications Access in Indian Country 

1. Encourage More Collaboration Among Federal Agencies 

All the federal agencies charged with broadband and telecommunications improvement and deployment in Indian Country (e.g., FCC, RUS, NTIA) must work more 

closely together, coordinate their programs, and make more information available to 

Indian Country about the availability of grants, loans, loan guarantees and other 

financing options to support feasibility studies and technical assistance, as well as 

deployment of Internet infrastructure on Tribal lands. Interagency collaboration on 

alternative financing options (e.g., Indian loan guarantees, Tribal governmental 

bonds, new market tax credits, etc.) should include representatives from the Departments of the Interior and Treasury. 

2. Require Collection of More Current Data on Internet Penetration 

Much of the information collected and reported is outdated and conflicting. To target their precious available funding better, the federal agencies must collect more 

current data on actual penetration of Internet service in Indian Country, rather 

than rely on estimated projections developed years ago. 

3. Develop Farm Bill Amendments Targeted to Indian Country Internet Access 

One such amendment should beef up the USDA Secretary’s Office of Tribal Affairs 

with adequate funding to continue the excellent leadership this office has provided 

on Indian Country issues. Another amendment should authorize an Indian Country 

liaison to work within RUS to help coordinate outreach efforts and technical assistance for tribes on programs for broadband deployment. A third amendment should 

ensure that the SUTA provisions apply to all RUS and Rural Development programs that benefit Indian Country, and are adequately funded. 

4. Create Set-Asides in All Federal Broadband Programs 

The SUTA provisions authorize RUS to prioritize broadband funding for underserved Tribal areas, but they contain no specific amounts to be appropriated. SpeVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00053 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
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cific amounts should be authorized to be appropriated for SUTA broadband deployments, or a certain portion or percentage of the overall amount appropriated for 

broadband and telecommunications infrastructure loans should be set aside for 

SUTA deployments. Another RUS program, the Community Connect Grant Program, is ideally suited to Indian Country because only communities with no 

broadband connections are eligible to apply. As the program is very oversubscribed 

at its current funding level of only $18 million, doubling its funding would result 

in major benefits to Indian Country. A Tribal set-aside or priority funding should 

be considered for the other RUS and NTIA programs as well. 

5. Create a Native Nations Broadband Fund 

Tribal focused funding within the Universal Service Fund (USF) would provide 

targeted funding for broadband deployment in Indian Country. Broadband Internet 

service access and mobility services should be included in the list of services provided by the USF. Allocating spectrum for Tribal communities also should be explored. 

B. Clarify and Streamline Acquisition and Leasing of Trust Lands 

1. Clarify Trust Acquisition Authority 

The National Center thanks the Committee for reporting to the full Senate legislation to eliminate confusion from the Supreme Court decision in Carcieri v. Salazar

by clarifying 1934 Indian Reorganization Act provisions to ensure that all federally 

recognized tribes are eligible for the benefits of Section 5 of the Act, regardless of 

whether they were ‘‘under federal jurisdiction’’ in 1934. We also applaud the Committee’s continuing efforts to educate Senate colleagues of the need to clarify trust 

land status so as not to create barriers to Internet infrastructure deployment, energy, manufacturing and other similar business and economic development projects, 

and law enforcement activities. 

2. Allow Greater Tribal Self-Determination in Leasing Tribal Lands 

Approve legislation to permit any tribe to develop its own leasing regulations and 

seek BIA approval of such regulations so that the tribe will be able to lease Tribal 

lands Internet infrastructure, housing or other community development purposes 

without BIA prior-approval. 

C. Approve Native American Business Development Provisions 

After careful deliberations, last year the Senate Committee on Indian Affairs developed several very signification proposals to enhance business and economic development in Indian Country. Below are the provisions that the National Center urges 

the Committee to take up again and promptly move forward: 

1. Native American Business Development Program 

After several years, there is now consensus on provisions (most recently contained 

in last year’s S. 3534) to authorize the SBA’s Office of Native American Affairs 

(ONAA), headed by an Associate Administrator, and grants for Native American 

Business Centers so that more business management, financial and procurement 

technical assistance can be made available in more locations throughout Indian 

Country. SBA’s ONAA must have more authority to claim a fair share of the funds 

already appropriated for SBA’s entrepreneurial development program overall. Without specific authorization to access those entrepreneurial development program 

funds, the ONAA will continue to be substantially disadvantaged in trying to provide adequate outreach and assistance across the country with its grossly inadequate budget of only $1,250,000 (down from $5,000,000 annually during the Clinton Administration). 

2. Surety Bonding 

The Indian Finance Act should be amended to expand existing authority for the 

Secretary of the Interior to issue surety bond guarantees either independently or 

supplemental to a surety bond guarantee issued by SBA, up to 100 percent of 

amounts covered by a surety bond issued for construction, renovation, demolition, 

and even broadband deployment work performed or to be performed by an Indian 

individual or Indian economic enterprise. Often Tribal and individual Indian-owned 

construction companies engaging in construction contracting (whether under federal, 

state, local or Tribal government contracts, or commercial contracts) face significant 

barriers to securing any surety bonding at all. Many insurance/surety companies 

choose not to work with Tribal contractors, because they do not understand Tribal 

sovereignty and do not want to work with Tribal courts. Technical assistance and 

training for contractors seeking surety bonding also would help them mitigate risk, 

build capacity, improve performance, grow and create more jobs. The National CenVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00054 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
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ter’s business assistance centers provide this type of guidance now, but more targeted assistance related to surety bonding is needed. 

3. Indian Loan Guarantee Program Enhancement 

The Indian Finance Act authorized the Secretary of the Interior to provide guaranteed loans to businesses that are majority-owned by tribes or Indians. Implementing regulations require Tribal businesses to provide collateral worth at least 

20 percent of the loan principal. Too frequently, this equity requirement inhibits the 

launch of on-reservation enterprises or development projects that employ reservation residents. Last year’s Indian Jobs proposal recommended amending the loan 

guarantee provisions to establish a tiered system, based on the number of on-reservation jobs created, that would provide more favorable equity terms and authorize 

an increase in the amount guaranteed up to 100 percent for energy and manufacturing businesses. Provisions could be added to assist with Internet infrastructure 

deployment. These changes would make the Indian loan guarantee program far 

more helpful to the establishment of Tribally-owned energy or manufacturing businesses, and potential employment of more local reservation residents. 

4. Buy Indian Act Amendments 

Enacted in 1910, the Buy Indian Act obliquely states simply that ‘‘so far as may 

be practicable Indian labor shall be employed, and purchases of the products of Indian industry may be made in open market in the discretion of the Secretary of the 

Interior.’’ (25 U.S.C. 47). Last year’s proposal included provisions to clarify and 

strengthen Buy Indian procurement procedures to apply to an agency fulfilling its 

requirements by making use of funds appropriated for the benefit of Indians. Such 

procedures would foster increased award of contracts to Indian economic enterprises 

by procurement personnel of the Department of the Interior, Indian Health Service, 

and other agencies receiving funds appropriated for the benefit of Indians. Also proposed was creation of a Data Center for the collection of information on the experience, capabilities and eligibility of Indian economic enterprises, and reporting requirements on agency use of the Buy Indian Act and information collected by the 

Data Center. At a minimum, the Committee should request briefings by the agencies, or conduct a roundtable discussion or oversight hearing to receive status reports from these contracting agencies on their past performance in contracting with 

Native contractors of all types, and their plans for increasing that contracting support. Witnesses from Indian country also should be invited to report on their efforts, 

successful and unsuccessful, to convince these agencies to award contracts, park 

concessions, etc. to qualified Native contractors. 

V. Conclusion 

The National Center thanks the Committee in advance for considering our comments and recommendations. 

Attachment 

FULL NATIVE BUSINESS AND ECONOMIC DEVELOPMENT POLICY AGENDA

Approved by the Board of Directors of The National Center for American Indian 

Enterprise Development—September 7, 2011

On September 7, 2011, the Board of Directors of the National Center for American 

Indian Enterprise Development approved a broad business and economic development policy agenda. As the National Center embarks on its 5th decade as the leading advocate and longest-serving provider of Native business development assistance, it will advance its policy agenda with the goal of promoting job creation, business capacity building, greater access to the internet, capital and contracting, infrastructure improvement, and increased commerce—in Indian Country, nationally and 

globally. 

The National Center will promote this Native Business and Economic Development Policy Agenda through its national advocacy activities, its growing number 

(soon 12) business and procurement technical assistance offices across the United 

States, its national and regional events, and in partnership with other national Native organizations. In the pages that follow, the National Center outlines its top policy priorities for Native business and economic development, Tribal sovereignty, capacity building and job creation. 

The National Center’s Top Native Economic Development and Jobs

Priorities 

The National Center urges prompt action on the public policy initiatives within 

the four categories of issues listed below: Tribal Sovereignty and Capacity Building, 

52

and Job Creation; Native Business Development and Best Practices; Access to Capital; and Tax Issues. 

I. Tribal Sovereignty, Capacity Building, and Job Creation 

A. Full Broadband and Telecommunication Access in Indian Country 

Collaborate with the federal agencies promoting broadband access and telecommunications improvements and expansion into Indian Country (e.g., USDA 

Rural Development and Utility Services, Commerce’s National Telecommunication 

Information Service, and Federal Communications Commission) and other national 

Native organizations developing initiatives to facilitate communications services and 

related infrastructure deployment and spur Tribal and other Native business, economic, and community development (Administration action needed). 

B. Expedite Land Acquisition and Leasing of Tribal Lands 

1. Clarify Trust Acquisition Authority: Eliminate confusion from the Carcieri decision by enacting legislation to clarify 1934 Indian Reorganization Act provisions to 

ensure that all federally recognized tribes are eligible for the benefits of Section 5 

of the Act, regardless of whether they were ‘‘under federal jurisdiction’’ in 1934 (e.g., 

S. 676, H.R. 1234 and 1291). 

2. Approve Greater Flexibility and Streamlined Procedures for Land Acquisitions 

and Leasing of Indian Lands: Prioritize timely completion of BIA procedures for acquisition and leasing of Indian lands so as to enhance economic development. Revise 

BIA leasing procedures to allow tribes to select and use certified, licensed appraisers. 

3. Expedite BIA Actions on Land Acquisitions and Leases: BIA must expedite approval of pending trust acquisition and leasing applications. 

4. Allow Greater Tribal Self-Determination in Leasing Tribal Lands: Permit any 

tribe to develop its own leasing regulations and seek BIA approval of such regulations so that the tribe will be able to lease Tribal lands for housing or other community development purposes without BIA prior-approval (e.g., H.R. 1599). 

C. Streamline Federal Employment, Training and Other Support Programs 

1. Make Permanent the ‘‘477’’ Jobs Program Integration Concept: The Indian Employment, Training, and Related Services Demonstration Act (Public Law 102–477) 

should be made permanent to allow tribes to combine formula funded federal grants 

for employment and training into a single budget and reporting system (as in Section 5 of S. 3471 of 2010). Refine the accountability system, working through Tribal 

consultation with affected agencies (Departments of Interior, Labor, Health and 

Human Services, and Education). (OMB could approve the reforms.) 

2. Collaborate on Integration of Other Training and Education Programs: Support 

initiatives to enhance Tribal colleges and their development of business-related curricula and job skills training programs. Permit tribes or Tribal organizations to submit proposals for coordinated federal program assistance to support a community, 

economic or business development project that is consistent with the goals of those 

programs (e.g., H.R. 1599). 

II.Native Business Development and Best Practices 

A. Expand Native American Business Development Services 

1. Small Business Administration: The SBA should allocate more funding (at least 

$2 million up from $1.25 million) to its Assistant Administrator of the Office of Native American Affairs (‘‘ONAA’’) to provide greater support for Native entrepreneurial development, and require Small Business Development Centers to team 

with existing Native business centers to expand services to more Tribal-owned and 

individually owned Native businesses. The ONAA should be formally authorized, 

headed by an Associate Administrator, have its own budget of at least $2 million, 

and have grant authority to target existing entrepreneurial development funds to 

support more Native American business centers (e.g., S. 3534 in 2010). 

2. Department of Commerce: The Minority Business Development Agency (MBDA) 

should receive at least $31 million and allocate more support to its 8 Native American Business Enterprise Centers and to the Office of Native American Business Development; and the Department should allocate more funding to the Office of the 

Secretary’s Senior Advisor for Native American Affairs (as proposed in the pending 

House appropriations bill). These programs should focus more attention on Native 

business expansion both nationally and internationally, including intra- and interTribal commerce, export assistance, trade mission involvement, and tourism. 

3. Department of Defense: The Defense Logistics Agency’s Procurement Technical 

Assistance Program should receive $34.3 million for FY 2012, with $3.6 million set 

53

aside for 6 American Indian Procurement Technical Assistance Centers (as in pending appropriations). 

B. Enhance Native Contracting Preferences 

1. Strengthen and Enforce Buy Indian Act Requirements: Update, implement and 

enforce Department of the Interior Buy Indian Act regulations (finalize pending BIA 

regulations). Apply Buy Indian requirements to other agencies to encourage greater 

use of Indian contractors for requirements to be fulfilled using federal funds appropriated for the benefit of Indians (as in Section 7 of S. 3471 in 2010). 

2. Preserve the Native 8(a) Program: Protect SBA’s 8(a) Business Development 

Program provisions that benefit contracting companies owned by tribes, Alaska Native regional and village corporations (ANCs), Native Hawaiian Organizations 

(NHOs), and individuals who are American Indian, Alaska Native or Native Hawaiian. Prevent any further erosion of the 8(a) preferences for tribes, ANCs and NHOs 

beyond the Section 811 requirements for justification and approval of sole source 

awards over $20 million. 

3. Maintain the 5 percent Indian Incentive Program: Provide at least $15 million 

for the DOD 5% Indian Incentive Program to enable federal contractors to receive 

an incentive of 5 percent of the value of work subcontracted to Native contractors 

(as in pending appropriations). 

C. Open Trade and Export Promotion Opportunities 

Collaborate with the Department of Commerce’s International Trade Administration, MBDA and Senior Advisor for Native American Affairs, and the SBA’s Office 

of International Trade and Native American Affairs, to increase efforts to ensure 

that Tribal political and business leaders, and more Native-owned business leaders, 

are included in U.S. trade delegations and missions involving government and private participants. SBA, and Commerce, and their respective officials charged with 

Native American Affairs and International Trade duties should meet with national 

Native business organizations to determine how to ensure that the U.S. Export Assistance Centers around the country can receive more training and assistance on Indian business issues and provide more outreach and support regarding export of Native goods and other trade-related activities. 

D. Increase Support for Data Collection on Business Development, Job Creation, 

and Best Management and Other Best Business Practices 

All federal agencies with finance-related responsibilities to Indian Country (e.g., 

BIA, SBA, MBDA, USDA, HUD, and the new Consumer Financial Protection Bureau (CFPB)) should make available data on the number of Native-owned business 

credit applications submitted, and loans and loan and surety bond guarantees approved and declined, so that a more reliable database on Tribal and Native business 

and economic development activities can be developed. The new CFPB already is 

statutorily required to collect information concerning credit applications of womenand minority-owned businesses. SBA, MBDA, USDA, and HUD funds should be 

made available to support collection of more data on Native businesses by industry 

sector, their growth and their job creation, and best management practices and 

other best practices in business. 

III. Access to Capital 

A. Expand Use of BIA Loan and Bond Guarantees 

The BIA’s program for loan and surety bond guarantees should be fortified with 

highly skilled finance staff that can better deploy funds provided for guarantee 

issuance, as follows—

1. Indian Loan Guarantees: BIA’s Office of Indian Energy and Economic Development (OIEED) should develop more flexible equity terms and higher (up to 100 percent) guarantee limits, especially for energy projects and manufacturing businesses, 

and ensure that more loans can be made and guaranteed promptly, perhaps with 

priority given to startup or expansion of on-reservation enterprises or development 

projects that employ reservation residents. (Many improvements can be made administratively, but changes in equity requirements many need a regulation change, 

or legislation as in Section 3 of S. 3471 in 2010.) 

2. Surety Bond Guarantees: Implement existing authority for BIA to issue surety 

bond guarantees supplemental to a surety bond guarantee issued by SBA, up to 100 

percent of amounts covered by a surety bond so that Tribal and individual Indianowned companies can obtain bid and performance bonds and qualify for award of 

construction and other federal, state, local or Tribal contracts, and commercial contracts. (Only administrative action is needed to implement existing authority; legisVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00057 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
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lation, as in Section 4 of S. 3471 in 2010, would be needed to allow BIA to issue 

surety bond guarantees on its own.) 

3. Tribal Economic Development Bonds: Explore amending the Indian Finance Act 

and Internal Revenue Code to authorize the BIA federal guarantee credit subsidy 

to be used to back Tribal economic development bond offerings and possibly other 

Tribal tax exempt bonds. (Legislative action needed to authorize this expanded authority and appropriate funds for a larger credit subsidy to support such bond guarantees.) 

B. Improve and Tailor Capital Access Programs to Native Borrowers 

1. Codify and Enhance the Native CDFI Assistance Program: Include specific Native CDFI provisions in the CDFI Fund authorization and sustain Native CDFI 

funding. (Both authorization and appropriations actions are needed.) 

2. Advocate for More Training of Staff Working Federal Loan Processing: Urge 

SBA (especially SBA Loan Processing Center staff), BIA, USDA, OCC, FDIC and 

Federal Reserve to provide more training for their personnel on Indian business and 

lending issues, and conduct some of interagency training sessions to foster greater 

agency collaboration in efforts to improve access to capital for Native borrowers. 

(Administrative action is needed.) 

3. Co-Host More Access to Capital Special Sessions and Workshops: Collaborate 

with on-going federal workshops on capital access. For RES 2012, plan and co-host 

Plenary Sessions on Native Lending Issues, Learning Sessions on special issues, and 

a new Pavilion event where Native businesses can meet one-on-one with bankers 

and other lenders. 

4. Encourage Further Tailoring of Federal Loan and Guarantee Programs: Assess 

at RES and other sessions what further changes should be made to federal loan and 

guarantee programs, and collaborate in developing proposals for such refinements. 

5. Join Calls for Use of Community Reinvestment Act and Other Requirements: As 

the Center for American Progress recommended, federal agencies should clarify that 

CRA credits can be applied to investments in alternative energy facilities, energy 

efficiency enhancements. A Native community development component should be 

added to the CRA exam for large banks and even some intermediate or small banks. 

These banks’ performance should be reviewed and improved, and their performance 

evaluations should include analysis of their bank services to tribes and Tribal- and 

other Native-owned businesses. (Administrative actions are needed.) 

IV.Tax Issues 

A. Enhance Tribal Tax Exempt Bonding Authorities 

Eliminate the ‘‘essential government function’’ test now used to qualify Tribal 

projects for tax exempt financing, and expand Tribal tax exempt private activity 

bond authority to include commercial projects with economic, environmental or 

other social value. Exempt Tribal governments’ bond issuances from Securities and 

Exchange Commission registration requirements. Deem projects of Section 17 corporations and other wholly owned Tribal entities as qualifying projects for tax exempt financing. (All require legislative action; H.R. 1599 contains the first two proposals.) 

B. Clarify Tax Exempt Status of Tribes and Tribal Enterprises 

While the tax exempt status of tribes and Tribal enterprises chartered under Section 17 is fairly well settled, clarification is needed that a Tribal enterprise chartered under a Tribal corporation code or a limited liability code is similarly exempt 

from federal corporate taxation and state taxation. A tribe’s percentage ownership 

of a project also should be exempt from such forms of taxation. (Administrative clarification in BIA leasing regulations is needed, if not legislation.) 

C. Extend or Make Permanent Employment and Investment Tax Provisions 

The Indian employment tax credit and accelerated depreciation of investments on 

reservation lands should be extended for longer periods or made permanent to ensure that these provisions result, as intended, in incentivizing business investments 

in Indian Country. Such investments should be made in conjunction with Tribal development plans. So that Section 17 corporations and other wholly Tribal owned entities also can benefit, provisions should be included to allow these Tribal enterprises to sell these tax credits on the secondary market. (Legislative action would 

be required.)

The CHAIRMAN. Thank you very much, Ms. Gray-Proctor. 

Mr. Pollock, will you please proceed with your testimony? 

55

STATEMENT OF MICHAEL J. POLLOCK, MANAGING DIRECTOR, 

SPECTRUM GAMING GROUP LLC 

Mr. POLLOCK. Mr. Chairman, thank you for this opportunity. I 

have been asked to address the very specific issue of Internet gaming. 

I have spent significant time in recent months meeting with Native American leaders both in Washington and throughout the 

United States. The common question I hear is, what will Internet 

gaming mean for our Indian nation, our casinos, our future. 

I suggest that with the politics of this issue in such a state of 

flux, such a question is impossible to answer with any degree of 

certainty. A more relevant question, I suggest, is what should 

Internet gaming mean for our Indian nation, our casinos, our future. And that question is more easily addressed, because we know 

the business model that most Indian and commercial casinos follow. And we know the potential of Internet gaming. 

Internet gaming is widely viewed as a revenue stream for government. What is less readily apparent is that Internet gaming 

also represents a significant marketing opportunity for Indian casinos. Internet gaming offers the ability to reach customers easily 

and at low cost, to identify their potential and to cultivate those 

customers and reward them through the ability to earn a visit at 

their brick and mortar casinos. 

In other words, what I am saying is, there is more than one revenue stream that can be generated. If Internet gaming is allowed 

to develop as simply one revenue stream, then I suggested the 

United States has squandered a once in a century opportunity. We 

all look to Europe in Internet gaming as the model, because that 

is where it exists legally and that is where people want to, or consider importing to the United States. 

It has limited applicability, because in Europe, it does not have 

the brick and mortar industry that we have here on Tribal lands 

and in commercial casinos. Hundreds of billions of dollars have already been invested in casinos across the Country, commercial and 

Native American operations, in part because government sought to 

create more than just tax revenues. They sought to create jobs, to 

invigorate downtowns, to spur tourism and to assist many Indian 

nations in developing a sustainable business model to create career 

opportunities for their members and their communities. 

These goals assume that adults, gaming and non-gaming alike, 

will generate real, not virtual visits to casinos. That is how you 

generate employment and how you generate sufficient returns in 

all that invested capital. This hearing is subtitled Equal Access to 

E–Commerce Jobs and the Global Marketplace. What I am suggesting from a public policy standpoint is that you recognize the 

advantages of ‘‘unequal’’ access, in which operators, particularly 

Tribal operators, have brick and mortar casinos, have a real and 

sustainable advantage as Internet gaming develops, should it develop. 

And that is the essence of my comments, and I am ready to answer any questions. Thank you. 

[The prepared statement of Mr. Pollock follows:]

56

PREPARED STATEMENT OF MICHAEL J. POLLOCK, MANAGING DIRECTOR, SPECTRUM

GAMING GROUP LLC 

Thank you for this opportunity to address the Committee on this important matter. We believe that the goal of providing equal access to the opportunities afforded 

by Internet wagering can be advanced if gaming policies in the United States are 

coordinated. Indeed, we believe that the existing policies regarding brick-and-mortar 

casinos be coordinated with the proposed policies regarding Internet wagering if you 

seek to maximize the benefit. 

I have spent significant time in recent months meeting with Native American 

leaders both in Washington and throughout the United States. The common question I hear is: What will Internet gaming mean for our Indian nation, our casinos, 

our future? 

I suggest that, with the politics of this issue in such a state of flux, such a question is impossible to answer with any degree of certainty. A more relevant question, 

then, is: What should Internet gaming mean for our Indian nation, our casinos, our 

future? 

That question is more easily addressed because we know the business model that 

most Indian and commercial casinos follow, and we know the potential of Internet 

gaming. 

Internet gaming represents a significant revenue stream for government. What is 

less readily apparent is that Internet gaming also represents a significant marketing opportunity for Indian casinos. Internet gaming offers the ability to reach 

customers easily and at low cost, to identify customers’ potential, and to cultivate 

customers and reward them through the ability to earn visits at their brick-andmortar casinos. 

If Internet gaming is allowed to develop as simply a revenue stream, then I suggest the United States has squandered a once-in-a-century opportunity. 

In Europe, for example, Internet gaming has developed largely as an independent 

revenue stream. The European model, however, has limited applicability in the 

United States, largely because Europe does not have anything close to the brickand-mortar gaming-industry infrastructure that has developed throughout the 

United States. 

Hundreds of billions of dollars have already been invested in casinos across the 

country—both commercial and Native American operations—in part because authorizing governments sought to create more than tax revenues. They sought to create 

jobs, to invigorate downtowns, to spur tourism, and to assist many Indian nations 

in developing sustainable business models to create career opportunities for their 

members and their communities. 

Those goals assume that gaming and non-gaming adults alike will generate real, 

not virtual, visits to casinos. That is how you generate employment, and how you 

generate sufficient returns on all that invested capital. 

The sub-title of this hearing is ‘‘Equal Access to E-Commerce, Jobs and the Global 

Marketplace.’’ From a public-policy standpoint, I respectfully suggest that this committee recognize the advantages of ‘‘unequal access.’’

We assume that effective regulatory and licensing requirements will be part of 

any legislative package, whether at the federal or state level. We assume that sufficient controls will be required to address issues such as underage gambling or problem gambling. I respectfully suggest adding another assumption: Existing and future operators of Indian and commercial casinos should be among the primary beneficiaries of Internet wagering if you seek to maximize the benefits of Internet wagering. 

Congress lacks the power to ensure that all providers of legal Internet wagering 

will benefit equally, or even that all providers will benefit at all. I am simply suggesting that the existing policies regarding brick-and-mortar casinos be coordinated 

with the proposed policies regarding Internet wagering if you seek to reach your 

stated policy goals. 

Thank you again for this opportunity.

The CHAIRMAN. Thank you very much, Mr. Pollock, for your testimony. 

Mr. Morgan, in your testimony you have illustrated the reasons 

why e-commerce is so attractive to Indian communities. But that 

success often comes with increased scrutiny from State and Federal 

entities. My question to you is, in what ways can the Committee 

ensure that Tribes have equal access to market opportunities? 

57

Mr. MORGAN. That is an excellent question. I think from the Federal level, I think they play a very big role. The primary dispute 

in my world as a CEO is with State regulations and States’ attempt to control and State taxation issues. There is a system of 

sort of fighting that out. The tribes themselves have been able to 

largely bypass that system with Internet-related activities. The 

States have been frustrated 

So what concerns me is that the States will attempt to come to 

Congress to get a fix, we will call it the Internet fix, to see if they 

can take some control over what we are doing in that context. 

The reason I am concerned about it is because it has happened 

many, many times before, in the pre-Internet era, and it just happened again with the PACT Act. So I think that the States are sort 

of repetitive in their approach. And I think there are lots of issues 

coming up right now, whether it is Internet gaming or lending or 

any other sort of innovative retail sales tax issues, those types of 

things, where the State is going to try to impose their will on some 

level. 

And there is no direct way to do it, because the Internet bypasses 

their normal system of control by threatening those who deal directly with us. It leapfrogs their roadblocks and puts us in the 

stream of commerce. So the only other person who can stop us is 

Uncle Sam. So we want to make sure that we are his favorite 

nephew and they take care of us. Because they are going to come. 

And they are going to come in a way that sound reasonable and 

it is going to sound like it is a big problem. But what they are coming for is to take our money and to isolate us once again. 

So the answer to your question is, just defend our rights and let 

us have a fair and open chance to at least discuss our perspective. 

The CHAIRMAN. Thank you very much, Mr. Morgan. 

Ms. Gray-Proctor, building broadband infrastructure relies on 

quality access to capital. What does NCAIED recommend to improve lending? And why do lenders continue to pull back from investing in Native communities? 

Ms. GRAY-PROCTOR. I am probably not the right person to ask on 

that, because I am on the other side of it. I am a businesswoman. 

But we hear that many times from many of our Tribal enterprises, 

of the challenge of access to capital. For instance, you look at how 

many banks that we have within Indian communities, there is a 

handful. Why is that? Because of course you go with the regulations that banking brings. It is also because of the land issue, the 

trust land that is there. They can’t own it, they can’t hold it, they 

can’t, if you don’t fulfil your obligation of your loan, they can’t take 

it. 

So there are quite a few different challenges, just the land and 

the trust and some of those land issues have. But what we see is 

how this applies with the Internet and broadband on Indian land, 

is that it also gives us access to lending if it is high speed. It is 

just not whether we have it, we want our entrepreneurs to be able 

to do online banking, to be able to be paid by the U.S. Government 

whether they get a government contract, whether it is an 8(a) contract, a government contract, a Tribal contract. A lot of it has to 

be directly deposited into an account. 

58

As what we say, Native to Native business is that whether you 

have a government client or you have a Tribal client, all commerce 

is done anywhere is whether it is on an iPhone, I am not just saying specifically a phone, but a cell phone, the iPad or the tablets, 

business is done that way. I have been doing that while I have 

been on this visit here. Sitting back here, I am conducting business 

while we are here. 

But I can tell you that some friends of mine who live in Montana, 

or whether in Minnesota, who live in rural areas, can’t do it. So 

that is what we are here to speak about, is that we need to level 

the playing field, like Mr. Morgan had said. 

The CHAIRMAN. Thank you. 

Mr. Pollock, online gaming is currently legal in 85 nations. If 

Internet gaming becomes legal in the United States, are tribes 

poised to participate in this market in a way that would allow 

them to fully benefit from that opportunity? 

Mr. POLLOCK. Some are better poised than others. The essence 

of what I am trying to say, in multiple forums, is that they should 

be poised. And the legislation or regulations that authorize Internet gaming should recognize that they need to leverage what they 

offer, their existing gaming properties. Because they are enormous 

assets. 

It can go two ways. Either they are going to be forced to compete 

against websites that are not tied to any brick or mortar casino, 

Tribal or commercial, in which case you have an unlevel playing 

field. But if they are able to leverage their assets, their existing assets, to bring people onsite, those are the types of opportunities 

that are going to allow them to be poised. They can be poised, not 

all are. 

The CHAIRMAN. Thank you for your response. 

Mr. Morgan, how has the Internet expanded Ho-Chunk Inc.’s 

ability to participated in government contracting business? 

Mr. MORGAN. I would like to address the last question briefly. It 

hadn’t occurred to me before, but if you want to help Indian Tribes 

do the Internet gaming, then do it outside of IGRA, where the 

States have this power to make us do something if they want to. 

Otherwise, it will be an impediment to our development in that 

area. So perhaps Internet gaming could be something different, 

outside of that arena. 

As far as, and I addressed this in my testimony a little bit earlier, but without the Internet, Tribes would be stuck in their geographic areas with low capital and really without the corporate infrastructure. I am talking about people on the ground in D.C., the 

people on the ground in international areas to execute. We would 

be unable to compete, really, on high-level government contracting. 

I don’t know if I made this point exactly before, but our world was 

the world of the low-income provider subcontractor. But 8(a), the 

Native 8(a) combined with the Internet, and the increased flow of 

information, I get an email every day telling me what new contract 

opportunities are out there. That could have never happened before. 

It has allowed us to move up the food chain and be the prime 

contractor, which gives us knowledge, gives us more income, which 

gives us more capabilities. And it is the kind of thing that feeds 

59

on itself. What you have seen arise in our world is small, rural 

companies who used to just do whatever somebody gave them small 

to do, to international, sophisticated, providing high level services 

to the government, all from these rural areas that you never would 

have dreamed possible just 10 and 15 years ago. 

So the Internet and the information flow that that allows and the 

advertising, partnering, all these kind of things, has been absolutely critical to that world. It has opened up our eyes to what is 

possible, instead of just being told what we could do on the low end 

of the scale. 

The CHAIRMAN. Thank you, Mr. Morgan. 

Ms. Gray-Proctor, NCAIED has identified new opportunities for 

Tribes in the global marketplace. How can access to broadband provide opportunities for Tribes outside the U.S.? What other tools do 

Tribes need to be global market players? 

Ms. GRAY-PROCTOR. Thank you for that question. That is one 

thing I am absolutely passionate about, is our Tribes, our Native 

Tribes, plus our Native-owned businesses, to be on the global marketplace. A year ago, I had the opportunity to go to Turkey on a 

trade mission. It just opened my eyes to what Indian Country has 

the capacity to do. 

That is why we launched the Native American Global Trade Center. What it will be is one location where all the different businesses, Tribal enterprises, can add their information, and do collective buying, to do international trade all over the world, which 

opens up the American dream, the Native American dream for all 

of us to be able to go after that. It levels the playing field, as we 

have been hearing all day. 

The opportunity that this will give, whether it is a business in 

Nebraska, a Tribal enterprise in Nebraska, to do work over in, 

whether it is Turkey, Australia, any other country, because they 

want to work with the tribes here. You look at the natural resources, you look at the energy, we look at the tourism component 

of what Indian Country has to offer, the scenic byways, learning 

about the different cultures. This would be good, it is good for Indian Country and it would be good for America. Because it gives 

us the opportunity to tell our story on our terms. It is our ability 

to do business on our terms and to be a player in the global market, again on our terms. 

And that is why I think it is so great that we have this oversight, 

and to have you listen to us and how we can move the Internet and 

the opportunity and these rural communities for another young Native woman who wants to be in business and understand how to 

be able to do that through the Internet. Right now, for instance, 

like SBA has the entrepreneurial tool box, how to get into business. 

Well, it is a little difficult for us to tell someone how to begin to 

start their business, to do a startup, when they don’t even have access to that to understand what those tools are. So sometimes we 

have to fax those papers to them. It stops progress. 

So to be on the global market, we are really excited about it, to 

have all the Tribal enterprises, the tribes. Because each one of 

them have those resources, whether it is, we have some tribes that 

sell light bulbs to light, then you have another tribe in the First 

Nations who has timber. They want to be able to trade. It is going 

60

to have that opportunity to do, be our own Wall Street, in a way. 

Thanks. 

The CHAIRMAN. Thank you very much, Ms. Gray-Proctor. 

Mr. Pollock, it often takes several sessions of Congress for legislation to be examined before it is passed. Given the most recent 

discussion drafts of Internet gaming, do you have any concerns 

about tribes being able to fully benefit from the Internet gaming 

market? 

Mr. POLLOCK. It is an interesting question, Mr. Chairman. When 

we first started looking at this, and we were talking particularly 

to staff members who were charged with drafting some of the earliest iterations of, in this case, Federal Internet gambling legislation, in some of the earliest iterations, the interests of Tribal casinos was not even considered. I found that particularly mind-boggling, put into silos, you are Indian casinos, we are talking about 

Internet gaming. They are entirely different matters. 

And they are not entirely different matters. They do need to be 

coordinated. And we have seen somewhat of a progression in terms 

of getting away from that silo mentality toward taking those interests into account. I suggest that there are additional ways going 

forward to help ensure that Tribal operators do have that very important equal access. To have not been as present in the existing 

legislation that I have seen, to the extent that they could be. 

The CHAIRMAN. Thank you very much, Mr. Pollock. 

Senator Murkowski, any questions of Panel Two? 

Senator MURKOWSKI. Mr. Chairman, I don’t have any questions 

for this panel, but I do appreciate what they have provided to the 

Committee here today, their perspectives. I appreciate not only 

what they presented here, but their written testimony and all that 

they have done. Thank you. 

The CHAIRMAN. Thank you very much, Senator Murkowski. 

I want to thank this panel, too, very much, for your testimony, 

your responses. Without question, it will be helpful in our discussing these issues further. We will continue to do that. So thank 

you very much. 

I would like to invite the third panel to the witness table. Serving on our third panel is the Honorable Robert Odawi Porter, President of the Seneca Nation of Indians, located in Irving, New York; 

Mr. Carl H. Marrs, Chief Executive Officer of the Old Harbor Native Corporation, located in Anchorage, Alaska; and Ms. Robin 

Danner, the President and CEO of the Council for Native Hawaiian 

Advancement, in Honolulu. 

I welcome all of you and ask President Porter to please proceed 

with your testimony. 

STATEMENT OF HON. ROBERT ODAWI PORTER, PRESIDENT, 

SENECA NATION OF INDIANS 

Mr. PORTER. Nya-weh Ske-no. Mr. Chairman and members of the 

Committee, I want to thank you for being here, and I want to 

thank you for your good health. 

I am here today to summarize my testimony that I have otherwise submitted in written form. 

My name is Robert Odawi Porter, I am a Herring Clan Seneca 

from the Allegany Territory of the Seneca Nation, as well as being 

61

a lawyer and a law professor. Last fall, I was honored to be elected 

as our 67th Nation President. 

The Seneca Nation is one of America’s earliest allies, living in 

peace with the American people since the signing of the 

Canandaigua Treaty nearly 217 years ago. Over the past two centuries, our nation has entered into numerous agreements and treaties with the United States. We have always sought to live up to 

our side of the relationship, as we have been guided by the teachings of the Guswhenta, or the Two Row Wampum, that requires of 

us that we maintain respect between us as peoples. 

I wish I could tell you that the United Sates has been as committed to our relationship over the years as we have. In the 

Canandaigua Treaty, the United States guaranteed that it would 

always recognize the Seneca Nation’s free use and enjoyment of our 

lands. Because of this treaty-protected freedom, our nation has 

been able to achieve economic success and recovery from the devastating loss of our lands and our natural resources. 

Both our nation government and individual Seneca people have 

benefitted from this treaty-protected freedom, which we have used 

to trade with non-Indians, especially in our gaming and tobacco 

businesses. But today, as always, we are under siege by hostile 

forces such as the State of New York and private sector predators, 

who seek to deprive us of our recent economic prosperity and return us to the poverty of the prior area. 

As this Committee examines the application of e-commerce in Indian Country, honoring the sovereign right of my nation as well as 

all Indian nations, to control our own trade from our own territory 

should be the primary focus. It is important to keep in mind that 

at the forefront of this inquiry, the fact that the Seneca Nation, 

like other Indian nations, are governments, not merely private corporate entities. We govern the people and economic activity within 

our own territories, and we use the revenues we generate to support government operations and services for our people. 

Unfortunately, the United States Government has too frequently 

forgotten this fact. The American economy is inherently expansionist, but American economic activity has chronically and habitually either raided Indian Country like a band of pirates or simply 

bypassed us completely. Most of our aboriginal lands and nearly 

everything associated with them have been taken from us. Whenever non-Indians have ‘‘discovered’’ that the Indians possessed 

something of value to non-Indians, the non-Indians have grabbed 

it for themselves. 

I would be remiss if I did not mention specifically the actions 

taken by the United States during my lifetime to take 10,000 acres 

of my homeland for the Kinsua Dam and Reservoir, so that a hydroelectric license could be granted to a mega-corporation to earn 

hundreds of billions of dollars at our expense. Indeed, the 1964 

Federal legislation that provided for relocation assistance to our 

people whose homes were burned so that this could happen directed that the Interior Secretary plan for our termination. Today, 

I ask that this legislation be repealed. 

Indeed, somehow Indian gaming slipped through the cracks of 

this otherwise sordid history. For the past two decades, a modicum 

of prosperity has resumed for Indian nations with territories near 

62

large population centers where gaming was otherwise not supported. But now the big casino industry and cash-starved States 

are pursuing casino gaming in nearly every State market, including our surrounding State of New York. 

These actions erode Tribal exclusivity and thus Tribal market 

share. The discovery of Tribal government gaming by non-Indian 

interests, like times of old, is now leading to its confiscation. 

One lesson that Indian Country must draw from this experience 

is that we must develop diversified Tribal economies as our corner 

of the casino gaming market is taken from us. But can Indian economic diversification outpace these tidal waves of non-Indian confiscation of our resources? Well, not if Congress continues to break 

our treaties like it did last year. 

Until last year, the Seneca Nation had a robust trading economy, 

based in large part on the sale of tobacco sales to non-Indians over 

the Internet. As with gaming, our Internet tobacco trade slipped 

through the cracks of history and for a time brought prosperity to 

many Seneca people. 

But last year, jealous big tobacco interests colluded with the avaricious appetites of State taxing authorities to persuade the Congress that they alone, not Indian nations, should govern the trade 

in tobacco products over the Internet. Over our strenuous objections, Congress last year enacted the Prevent All Cigarette Trafficking Act of 2010, the so-called PACT Act. This Act singlehandedly destroyed our Internet tobacco trade, bringing the booming Seneca e-commerce trade to a grinding halt and killing about 

2,000 jobs. 

If this Committee and the Congress believe that Internet commerce is the new American economic frontier, and the key to new 

jobs and economic growth, then what can we learn from our history 

with Indian gaming and the Indian tobacco trade? One lesson is 

unavoidable. The property rights of Indian nations must be respected and protected. Isn’t it time non-Indians respect the inherent and treaty-recognized rights of Indian nations to control what 

happens on and from our own land? That is exactly what the 

United States promised to us in the Canandaigua Treaty 217 years 

ago. 

I and many Tribal leaders have no patience for the pitiful lip 

service being paid in these hallways to a false concern for Indian 

jobs and diverse Tribal economies. If that concern is real, then 

please honor Indian treaties. Let Indian nations trade as 

sovereigns. Stop undermining Indian casino gaming and the Indian 

tobacco trade. And for goodness sakes, please don’t put Indian nations at the back of the Internet gaming bus before it leaves the 

station. 

Internet gaming has been likened to another modern day gold 

rush. Big gaming interests and big States have staked their claims 

and pushed for a Federal law that would give them an instant monopoly over Internet gaming operations. This brazen power grab is 

premised on the fiction that only Nevada and New Jersey interests 

are sophisticated enough to operate Indian gaming in the first 

wave. Like the land companies and oil companies before them, 

these gaming moguls see Indian gaming as a competitive threat 

63

and are determined to push Indian gaming away from the table or 

at best, deal Indian gaming a short hand. 

The truth is that the Seneca nation and dozens of other Tribal 

gaming operations are as sophisticated, if not more sophisticated, 

in terms of management, security, oversight and regulation than 

the biggest and best operators in Atlantic City and Las Vegas. 

After all, before the PACT Act wiped it out, Senecas operated one 

of the most robust Internet commerce operations in America. It is 

an affront to our dignity for the Congress to give any credence to 

the insulting notion that the Seneca Nation is somehow not ready 

or is inexperienced or is otherwise ill-equipped to conduct and regulate Internet gaming from nation territory. 

This Congress shapes the laws that govern e-commerce and must 

respect and honor our treaty rights to conduct business from our 

land, on our own terms and without restraint from any outside 

power. I urge this Committee to ensure that no Internet gaming 

legislation is enacted unless it guarantees to Indian nations the 

right to define the terms and reap all of the benefits for all Internet 

gaming that originates from Indian Country. 

We insist that you protect our inherent sovereign right to regulate commerce and activities in our territory, including Internet 

commerce on what remains of what we have, without regard to 

where our customers are located. Thank you for the opportunity to 

provide this testimony today. Nya-weh. 

[The prepared statement of Mr. Porter follows:]

PREPARED STATEMENT OF HON. ROBERT ODAWI PORTER, PRESIDENT, SENECA NATION

OF INDIANS

Introduction 

Nya-weh Ske-no. Mr. Chairman and members of the Committee, I am thankful 

that you are well and I am pleased to appear today to discuss briefly the written 

testimony I am submitting for the record on behalf of the Seneca Nation of Indians. 

The Seneca Nation of Indians (‘‘Nation’’) is one of America’s earliest allies, historically aligned with the other members of the historic Haudenosaunee (Six Nations 

Iroquois) Confederacy and living in peace with the American people since the signing of the Canandaigua Treaty nearly 217 years ago on November 11, 1794, 7 Stat. 

44. Our Nation has entered into numerous treaties and agreements with the United 

States since that time and we have always sought to live up to our side of this relationship, despite repeated instances in which the United States has not done so. 

The most important promise made to us by the United States under the 

Canandaigua Treaty is that the Seneca Nation would be recognized as a sovereign 

nation and that the title of our lands would remain secure. Specifically, the United 

States made a commitment to us that it made no other Indian nation—that we 

would retain the ‘‘free use and enjoyment’’ of our lands. This promise has served 

as the basis for a level of freedom possessed by the Seneca people that we believe 

is unmatched by other indigenous peoples in the United States. 

Because of this treaty-protected freedom, our Nation has been able to achieve success in recovering from nearly 200 years of economic deprivation inflicted upon us 

by the United States due to devastating losses of our lands and resources. Both our 

Nation government and individual Senecas have benefited from the opportunity to 

expanding into economic trade with non-Indians during the last 40 years, focusing 

primarily on the gaming and tobacco businesses. We have fought hard for our recent 

economic success—just as we have fought hard to protect our lands—but the fact 

remains that we are under constant assault from hostile forces such as the State 

of New York and private sector predators who seek to deprive us of economic prosperity and return us to the poverty of a prior era. 

64

Seneca Nation’s Territories Are Immune From State Taxation and Federal 

Regulation 

The Seneca Nation, our people and our lands, have been immune from state taxation and federal regulation since the day the United States of America was formed. 

Solemn agreement after agreement has reiterated this state tax immunity and our 

Nation’s inherent, sovereign right to regulate all conduct within our Territories free 

of interference by the United States. As I have mentioned, the most notable of these 

agreements is the Treaty of Canandaigua of 1794. 

This federal treaty obligation—

• To protect the immunity of the Seneca Nation and its Territories from the reach 

of taxation by the State of New York; and

• To protect our inherent, sovereign right to free trade; and

• To preserve our recognized right to regulate economic conduct within our Territories to the exclusion of the State of New York and the United States;

—should be the focus of any inquiry of this Committee into how e-commerce and 

e-trade from within Indian Country should be handled. And make no mistake about 

it, the Seneca Nation is fully capable of this. We have years of experience governing 

our own economy and trade with others. What follows is but one example of this. 

The Seneca Nation of Indians Enforces Its Own Comprehensive Laws Within Its Own Territory 

The Seneca Nation regulates and enforces all economic activity within our Territories. For example, our Council enacted a comprehensive Import-Export Law in 

2006 to regulate sales of tobacco and other products from its Territories. The Nation’s Import-Export Commission regulates all aspects of tobacco and other product 

sales. Among its other functions, the Commission—

• Requires that only Nation-licensed stamping agents may import tobacco products into Nation Territories;

• Prevents the sale of tobacco products without the affixation of a Nation import 

stamp and payment of the required import fee;

• Defines unstamped cigarettes as contraband;

• Requires accurate accounting of all stamps issued to Nation authorized stamping agents;

• Prohibits cigarette sales in excess of 9,800 cigarettes (lower than the Federal 

threshold);

• Imposes severe penalties, including loss of business license, for trafficking in 

contraband cigarettes; and

• Prevents the sale of tobacco products to minors under age 18.

As a result of the enactment and enforcement of its own Tribal law, the Nation 

has gained regulatory control of tobacco and other sales activities on its Territories. 

The Nation’s aggressive implementation of its Import-Export law has greatly enhanced its capacity to cooperate with the federal Bureau of Alcohol, Tobacco, Firearms and Explosives (BATFE) and the federal Alcohol, Tobacco Tax, and Trade Bureau (ATTTB) in enforcing the law on the Nation’s Territories. Please be assured 

that as a government with law enforcement responsibilities for our Territories, the 

Seneca Nation of Indians is committed to cooperation with federal authorities in the 

implementation of federal and Tribal law. The Nation is a leading player on the national stage with respect to eliminating illegal tobacco trafficking activity, and has 

likely done more to curtail contraband trafficking than any State agency, including 

that of New York State. 

I raise this example to remind everyone that Indian tribes, like the Seneca Nation, are governments. We govern the people and activity within our own Territories. 

This is reflected in the U.S. Constitution that governs how the United States government is supposed to deal with us—nation to nation. How America has actually 

dealt with Indian nations, however, is twisted into unconstitutional shapes. 

Seneca Nation History Is Replete With Irony 

If you look at American history from the perspective of a Seneca Nation citizen—

or of any American Indian for that matter—it is filled with irony. 

American economic development has chronically and habitually by-passed Indian 

Country or has extracted value and then abandoned Indian Country like a mere colony. Our history is one of nearly complete loss of what we once had. We have lost 

our lands and nearly everything associated with them. We have lost our natural resources, such as the beaver belt and the buffalo herds. We have lost our stores of 

65

gold, uranium, oil, gas, salt, and gravel. We have had the use of our remaining 

lands taken for railroads, highways, and reservoirs for hydroelectric dams. Just 45 

years ago, the United States again broke the Canandaigua Treaty and took 10,000 

acres of our Allegany Territory for the Kinzua Reservoir so that a license could be 

granted to a private mega-corporation to make millions of dollars from the sacrifice 

of our lands and the burning of our homes. When not actually confiscated, we have 

had coercive agreements pushed down our throats for only pennies on the dollar of 

the actual value taken by outsiders. 

In his Wealth of Nations, Adam Smith, the moral philosopher whose economic theory underpins modern-day American capitalism, said:

‘‘Civil government, so far as it is instituted for the security of property, is in 

reality instituted for the defense . . . of those who have some property against 

those who have none at all.’’

When it comes to Indian property holders, there is no question that the U.S. government has abandoned Adam Smith’s rule, completely subverting the natural order 

of property ownership. All too often the United States has appropriated, or has allowed states and others to steal, like common thieves, valuable property held by Native peoples. This, whether anyone likes it or not, is the common strain of American 

history towards the aboriginal occupants of this land. For Americans who care about 

justice, this history should be a source of shame and embarrassment. 

Discovery Has Led to Confiscation 

The storyline of American Indian history has been the same, time after time. 

When non-Indians ‘‘discover’’ that the Indians possess something of value to the 

non-Indians... then the non-Indians grab it for themselves. No money can adequately compensate Indian Country for these takings, and precious little money has 

ever been offered. 

Recently, Indian gaming slipped through the cracks of this history and for the last 

30 years a thousand flowers bloomed for Indian Nations with territories near large 

population centers in states where the law frowned upon gambling. Because gambling was disfavored by state law but craved by state citizens, neighboring Indian 

gaming markets thrived. The recognition by the U.S. Supreme Court of Tribal sovereignty in the pivotal Cabazon case, although constrained soon thereafter by the 

Indian Gaming Regulatory Act, resulted in a temporary but tangible advantage for 

some Tribal economies. 

But now big casino industry and cash-starved states are embracing casino gaming 

in nearly every state market. This is eroding Tribal exclusivity and thus, Tribal 

gaming market share. Once again, Indians have been discovered to possess something the non-Indian economic interests want for themselves. As inevitable as the 

sun’s rising in the East, discovery of Tribal government gaming is leading to its confiscation. This erosion makes it an absolute imperative that those of us who lead 

our Native Nations must develop diversified Tribal economies that can survive as 

our corner on the casino gaming market shrinks and shrinks. 

Can Indian Diversification Outpace the Tidal Waves of Non-Indian

Confiscation? 

Until last year, Seneca Nation had a robust and diversified trading economy 

based in large part on the sale of tobacco and fuel products to non-Indians. Unlike 

many other places in Indian Country, Seneca Nation Territories had a decades-old, 

private sector economy comprised of competitively-driven Seneca entrepreneurs. Our 

Seneca entrepreneurs traded products for years in bricks and mortar, over the 

counter transactions and, when the World Wide Web offered additional avenues for 

trade and commerce, they expanded their market reach into the Internet tobacco 

trade. 

Like with gaming, our Indian Internet trade in tobacco slipped through the cracks 

of history and for a time a thousand flowers bloomed. Because tobacco use was 

disfavored by state law but craved by state citizens, the Indian Internet tobacco 

trade thrived. But when jealous Big Tobacco industry interests combined with the 

avaricious appetites of state taxing authorities, their envy colluded to persuade the 

U.S. Congress that they alone, not Indian Nations, and their terms, not ours, should 

govern trade in tobacco products. 

Last year, the U.S. Senate and the U.S. House chose to over-ride strenuous objections from the Seneca Nation and enact the Prevent All Cigarette Trafficking Act 

of 2010, the so-called PACT Act. That Act single-handedly destroyed our Internet 

tobacco trade. It levied prohibitively costly fines and penalties on anyone connected 

with the common carriers and the U.S. Postal Service from moving our trade in toVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00069 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
66

bacco products. It brought Seneca Nation’s booming e-commerce trade to a grinding 

halt and threw hundreds of families out of work. 

The American Frontier or Indian Country? 

This Committee, with this hearing, as well as many other observers of the American economic future, appears to believe that e-commerce is the new American economic ‘‘frontier’’. That Internet commerce and trade is the future. If it is, what 

warning signals can we learn for Indian Country and our allies on this Committee 

and in Congress and the Administration? What lessons can we draw from the history of how the United States, and the various states, and American economic interests, have shaped the American frontier, from timber and gold and water to gaming 

25 years ago and to the Indian tobacco trade last year? 

One lesson is unavoidable. Isn’t it time the property rights of Indian Nations are 

respected and protected? If not now, when? Isn’t it time non-Indians respect the inherent and treaty-recognized rights of Indian Nations to control what happens on 

and from our own land? That’s exactly what the Treaty of Canandaigua promised 

the Seneca Nation and the Seneca people. 

I and many Tribal leaders have no patience for the pitiful lip-service being paid 

in these hallways to a false concern for Indian jobs and the diversification of Native 

economies. 

If that concern is real, then honor Indian treaties. Respect Tribal sovereignty. Let 

Indian nations trade as sovereigns. Stop undermining Indian casino gaming. Stop 

obliterating the Indian tobacco trade. And for goodness sake, don’t put Indian nations at the back of the Internet gaming bus before it leaves the station. 

Internet Gaming—A 21st Century Gold Rush 

In recent years the Big Gaming interests, not unlike Big Tobacco, have allied 

themselves with state regulatory interests in Nevada and New Jersey and pushed 

for federal Internet gaming legislation that would bestow upon them a monopolistic 

control of Internet gambling operations. That brazen power grab is premised on the 

fiction that the big Nevada and New Jersey interests are alone sophisticated enough 

to operate Internet gaming in the first wave. 

Like land homesteaders and gold stake claimers before them, these Nevada and 

New Jersey moguls see Indian gaming as a competitive threat and are determined 

to shove Indian gaming away from the table or, at best, deal Indian gaming a short 

hand. 

The truth is this: the Seneca Nation and dozens of other Tribal gaming operations 

are as or more sophisticated in terms of management, security, oversight and regulation than the biggest and best operators in Atlantic City and Las Vegas. In addition, until this Congress and this Administration recently shut it down with enactment of the PACT Act, the Seneca Nation regulated one of the most robust Internet 

commerce operations in America—the tobacco trade. It is an affront to our dignity 

for the Congress to give any credence to the insulting notion that the Seneca Nation 

is somehow ‘‘not ready’’ or inexperienced or otherwise ill-equipped to conduct Internet gaming from Nation Territory, according to Nation laws and regulations, anywhere the Internet markets take our game and our trade. 

Our treaty rights to conduct commerce—from our land, on our own terms, and 

without restraint by any outside power—must be respected and honored. That must 

apply to both over-the-counter trade and Internet commerce. 

This Congress and this Administration bowed to Big Tobacco and Big State interests last year with the PACT Act and devastated the Seneca economy. I urge this 

Committee, to find its true identity—as a strong ally of Tribal sovereignty and as 

a stalwart defender of Indian treaties—and fight to the death to ensure that no 

Internet gaming legislation is enacted unless it guarantees to Indian Nations the 

right to set all terms and reap all benefits of all e-commerce that originates on Indian Country. 

Internet gaming developments are the most recent, modern-day threat to Tribal 

sovereignty. I must ask this Committee—will Congress roll over once again and, 

PACT-like, squash Tribal sovereignty and Tribal ingenuity by acquiescing to the 

powerful Internet gaming interests in Nevada and New Jersey and the cash-envious 

state and federal treasuries? 

I don’t think you will. Your hearing today heartens me, and I think, many others. 

I encourage you to take the record you have heard today and work to ensure that 

Tribal sovereignty applies to all e-commerce emanating from Indian Country to all 

customers without regard to where the customers are located. 

The technology of 21st century trade and e-commerce challenges old notions of 

territory and borders and boundaries. The locus of where a ‘‘sale’’ is made, and controlled, must be returned to the place where the trader is located. In the case of 

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Tribal sovereignty, that would return sovereign control of all e-commerce originating 

on Indian land to the Indian Nation. 

Conclusion 

The Seneca Nation asks that this Committee ensure that the U.S. Congress, in 

conformity with its responsibility under the U.S. Constitution, honor our treaties 

and protect our inherent, sovereign right to regulate all commerce and conduct on 

what remains of our Indian Country. Thank you for this opportunity to provide testimony and we ask that it be made part of the record of this hearing. 

Nya-weh.

The CHAIRMAN. Thank you, Mr. Porter. 

Mr. Marrs, will you please begin with your testimony? 

STATEMENT OF CARL MARRS, CEO, OLD HARBOR NATIVE 

CORPORATION AND THE KODIAK–KENAI CABLE COMPANY 

Mr. MARRS. Thank you, Mr. Chairman and Senator Murkowski. 

Thank you for the opportunity to testify before the Committee 

today on the subject of Internet infrastructure in Native communities. 

I submitted a longer written statement, which I would ask be 

made part of the record. Meanwhile, I will summarize some of the 

key issues. I had a whole litany of what I did in the past, my history, but the two of you know me, so I will dispense with that. 

The CHAIRMAN. Your full testimony will be included in the 

record. 

Mr. MARRS. I was going to give you that background on myself 

to convey to you that I have really been involved, in one way or 

another, almost since the beginning of ANCSA. Seeing first-hand 

the positive aspects of the Act, and the negative aspects of the 

Alaska Native Claims Settlement Act. Like all indigenous people of 

America, the struggles for equality continue, even with Congressional mandates, in every Administration I remember. We have to 

fight our way through the bureaucratic system and through that 

process, mostly lose what we thought we gained in Congressional 

legislation. 

There are many hurdles for all indigenous people of America to 

still climb. This is not just limited to Alaska. But my job is to focus 

on what we can do for our people in Alaska, and the focus of this 

hearing is one of the best areas to start to help pull a struggling 

society up and bring it into the 21st century. 

The subject of equal access to e-commerce, jobs and global marketplace is vitally important, not only to the issue of access to the 

Internet, and all the windows of opportunity that it brings with it, 

but to all aspects of Native American life. As members of this Committee, you are all aware it has been a struggle for many years and 

continues to be a struggle for Alaska Natives and American Indians, Native Hawaiians to gain a foothold in Congress in a Country 

in which they are the Nation’s First Peoples. 

Mr. Chairman, all weather, highly reliable, high capacity, high 

speed broadband is where our future is. If we have a chance of saving our villages, our culture, our subsistence lifestyle, it is by getting genuine all weather, reliable high speed, high capacity 

broadband connectivity in our rural areas of Alaska. 

What does real-time broadband have to do with saving our culture? Subsistence way of life for our villages? It has everything to 

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do with it. We are losing people to urban areas because there are 

so few jobs available in rural areas generally. Without some sort 

of income in the villages in combination, subsistence and cashbased economies of today, our young people are having to move to 

where they can work, make money and provide for themselves and 

their families. 

Once they have moved away from the village, seldom do they 

move back. For many, though, if they were able to make a living 

in their villages and provide for their families and educate their 

children, they would choose to stay and continue to live in the village. 

If they don’t, over time they will lose touch with their culture 

and their way of life. This is a tragic situation that is exacerbated 

by the economic meltdown the Nation as a whole has been experiencing in recent years. Having genuine high speed, all weather, robust broadband capacity in our rural areas gives them a fighting 

chance to stay in their villages and live their traditional culture 

and subsistence way of life to the greatest extent possible. With 

this technology, people would be able to obtain advanced education 

and training, including college degrees, and earn a decent wage 

through many of the jobs that are now being carried at home over 

the Internet. 

Mr. Chairman, my written testimony details most of the reasons 

for the need for high speed broadband and why it is so important 

to people in rural Alaska. In addition, there is a map that is attached that will show you what we had proposed in the 2009 economic stimulus package. But that was not approved. 

Having a sub-sea fiber system that would serve all of western 

Alaska, including the Aleutian Chain, with branching units off a 

fiber backbone system, and operated by a carrier’s carrier, would 

open new horizons for people living in the largest unserved rural 

areas of the United States. Today, unfortunately, individual carriers building out systems that serve smaller areas intend to create 

monopolies in most cases, don’t really help rural Alaska, because 

they are really a closed system. In most cases, such systems are 

paid for by the Federal Government through grants and USF 

funds. At the end of the day though, the system doesn’t allow for 

assured competition which is needed to assure quality service. 

Having a backbone system, as we propose, with being a carriers’ 

carrier, would allow the backbone system to charge one price to all 

carriers, or mid and last mile providers. It would thereby create the 

kind of competition that is needed to bring pricing down in rural 

Alaska that would allow the people to use he system they need to 

use to create jobs in their villages and reside where they have their 

roots and history, and to live their culture, while have a foot in and 

being a contributor to the 21st century. 

We appreciate any and all actions by this Committee to help facilitate the expansion of such broadband to Native communities in 

Alaska, and believe that you could do nothing greater of importance to the lives of all Native Americans throughout the Nation 

than to help ensure such technology is available to them as soon 

as it can become a reality. 

If I may have the leeway, Mr. Chairman, at this point, in light 

of the Chairman’s announcement to retire at the end of this ConVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00072 Fmt 6633 Sfmt 6601 S:\DOCS\74030.TXT JACK
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gress, I would like to say a couple of things. First, Mr. Chairman, 

you have been a long-time friend of mine. You have been a friend 

as well to Native Americans, including Alaska Natives, Native Hawaiians. You are from the old school, being a genuinely gracious 

and thoughtful member of Congress, you are a great statesman. I 

will miss you acutely after you leave Congress. Hopefully I won’t 

be around that much longer, either. 

Your grace and commitment to high principles is without peer. 

I wish you well and appreciate all that you have done for indigenous people in the Country. 

Relevant to the discussion about the need for broadband for Native Americans, Native Alaskans and Native Hawaiians, I want to 

express my strong support for the Federal recognition of Native 

Hawaiians. Alaska Natives have a close relationship with their 

brothers and sisters from Hawaii. We stand firmly beside them and 

behind you, Senator Akaka, and Senator Inouye and your colleagues. 

In passing the Native Hawaiian Government Recognition Act, 

the federally-recognized Hawaiian government will play a significant role in assisting the Federal Government to assure broadband 

infrastructure and therefor e-commerce opportunities. So thank you 

very much, Mr. Chairman. 

[The prepared statement of Mr. Marrs follows:]

PREPARED STATEMENT OF CARL MARRS, CEO, OLD HARBOR NATIVE CORPORATION

AND THE KODIAK-KENAI CABLE COMPANY

Chairman Akaka, Vice Chairman Barrasso, Members of the Committee: 

Camai’ (hello), my name is Carl Marrs. Thank you for the opportunity to testify 

today before this distinguished Committee on the subject of ‘‘Internet Infrastructure 

in Native Communities: Equal Access to E-Commerce, Jobs and the Global Marketplace.’’ Thank you also for holding an oversight hearing on this subject matter that 

is vital to Alaska Natives. 

I serve as the Chief Executive Officer of the Old Harbor Native Corporation 

(OHNC) authorized by Congress and incorporated pursuant to the Alaska Native 

Claims Settlement Act (ANCSA). I’m here to testify on behalf of this corporation and 

its subsidiary, the Kodiak-Kenai Cable Company (KKCC). Further, my testimony is 

directly relevant to, and hopefully will be of benefit to, all Alaska Natives who do 

not have access to genuine, all-weather, highly reliable, high-capacity, and highspeed broadband. 

I am an Alutiiq and was born and raised in Seldovia, Alaska in the South-central 

region of the state. I’m a Tribal Member of the Native Tribe of Seldovia and a shareholder of Seldovia Village Corporation and of the Cook Inlet Regional Corporation. 

Both of these Native corporations were also authorized and mandated by the United 

States Congress through its passage of ANCSA in 1971. I served in the U.S. Marine 

Corp from 1970–1972. In 1973, I went to work for Cook Inlet Region Inc. (CIRI) 

starting as a land trainee and in 1995 I was appointed the President and CEO, 

serving over 30 years with CIRI. I have been involved in many Alaska Native 

Claims Settlement Act issues since the beginning and have seen many positive 

changes, but there are still many challenges to ensure that Alaska Natives, especially those in rural Alaska have the ability and tools to advance them from the 

alarming unemployment and poverty rates, teenage suicide rates, health and social 

issues, and other maladies that stem from a near absence of paying jobs many communities currently experience. 

Overview 

As most in the U.S. recognize, real time high-speed, high-capacity, reliable access 

to the Internet is an imperative in today’s global economy so as to see real jobs created through E-commerce. This reality was the genesis of OHNC’s major effort to 

bring all-weather, fiber optic marine cable based broadband to a hub on Kodiak Island. Once that was achieved as it was in 2007, the corporation’s goal has been to 

70

extend that telecommunications capability to all other Native communities in the 

Kodiak Archipelago. KKCC is in the midst of doing that. 

Further, extending that capability to other Alaska Natives (and non-Natives living in rural Alaska) in remote, unserved and underserved areas of Alaska led the 

OHNC to attempt to obtain NTIA and RUS grants and loans under the 2009 stimulus package. This quest to take high-speed, high-capacity, all-weather broadband 

to other Alaska Native villages was set back when the application for stimulus funding did not receive approval. Notwithstanding that set-back, the corporation is still 

supportive of this goal and hopes that it can become realized in the not-too-distant 

future. 

The stakes are high in human terms in rural Native Communities in Alaska. Our 

youth need new and robust ways to obtain a good education, including advanced 

education and vocational skills and training, and ways to make a living, while residing in their villages. Before broadband, this dilemma seemed almost insolvable. 

With access to such technology, providing state of the art telemedicine, education, 

cultural and social enrichment, and economic development become much more 

achievable. 

Background of ANCSA and the Village of Old Harbor 

Old Harbor Native Corporation is one of 252 Alaska Native village corporations 

authorized by Congress in 1971 with its passage of ANCSA. The purpose of that Act 

was to settle aboriginal claims of Alaska Natives to the lands that were purchased 

by the United States from Russia in 1867. A key part of the impetus to finally settle 

such aboriginal claims was that the United States needed to delineate and clear 

title to land for a right-of-way for the construction of the Trans-Alaska Pipeline to 

transport oil discovered at Prudhoe Bay to the Valdez Marine Terminal. 

The Native Claims Settlement Act was signed into law in 1971, and a few short 

years later, the pipeline was constructed and oil began flowing to Valdez and on to 

the market. The pipeline has been a major national energy security accomplishment 

since the oil has helped meet a significant portion of the daily U.S. demand of our 

nation for petroleum-based products. That pipeline also accounts for a significant 

portion of our nation’s daily domestic oil production and it is the largest economic 

engine in our state. The discovery of oil and its development and production has 

helped our state to develop into a major economic player in the nation’s energybased economy. More importantly for the Native shareholders I represent, it has 

provided Alaska with a means to create jobs, investment and economic activity 

while our village corporations work to grow our own local economies. 

In addition to being a national priority and imperative, ANCSA was developed by 

Congress as a visionary means of utilizing the free-enterprise system to help indigenous people economically. This was accomplished in ways that Congress and the Administration of President Richard Nixon thought would be more capable of bringing 

about economic advancement to Alaska Natives than would be possible through a 

Reservation-based, more traditional system as was used by the Federal Government 

in the lower-48 states with Indian Tribes. 

Under the Act, Alaska Natives were authorized and mandated to utilize the corporate structure to hold land and capital and were given great latitude to pursue 

their own economic futures for the benefit of their shareholders. No one was fully 

prepared to shift from a traditional culture and economy to one that was based on 

Alaska Natives becoming CEOs and Members and Officers of Corporation Boards 

of Directors. This was extremely challenging for our Native Leaders. Just as the 

original 13 colonies struggled to transition economically to a confederation after the 

signing of the Declaration of Independence, and as several boom and bust cycles 

across the United States have demonstrated since the Revolutionary War, learning 

to create, finance and grow an economy is a challenging feat. 

However, I am proud to say that since the passage of ANSCA in 1971, the growth, 

education, experience and leadership that Alaska Natives have gained about selfgovernance and corporate affairs in just the last 40 years, in stark contrast to the 

eons spent living as subsistence hunters and fishermen, is one of the most radical 

societal transformations in modern history. With some assistance from federal programs that helped such corporations to participate in federal contracting, many village and regional Native Corporations have become economic engines in Alaska representing approximately 12 percent of the gross state product and you can find such 

Native corporation offices and employees working on job sites all across the country 

and internationally. In other words, the hope and vision of those who crafted 

ANCSA are now starting to become realized in spite of many bumps in the road. 

Old Harbor Native Corporation was incorporated in 1973 and originally enrolled 

329 shareholders under the Settlement Act. Today, there are approximately 335 

shareholders residing primarily in Old Harbor, nearby in Kodiak, and in Anchorage 

71

as well as some outside of Alaska. The community of Old Harbor is rich in history 

and culture with the Ocean Bay Culture of Alutiiq Natives on Sitkalidak Island located across the Sitkalidak Strait from the village. That island is owned by OHNC 

and evidence of our people’s use of the land dates back 7,500 years in terms of 

human occupancy. 

The people of this village and other Alutiiq Natives survived ‘‘contact’’ with outsiders as seafaring nations reached the shores of Kodiak Island. The first Russian 

settlement in Alaska was at Three Saints Bay about 8 miles from the current village of Old Harbor. This and other contacts with the outside world brought infectious disease epidemics for which Natives had no natural immunities to protect 

themselves. Such epidemics devastated many communities on Kodiak. 

In relatively recent history, this village saw a number of homes and infrastructure 

destroyed by the 1964 earthquake and tsunami that hit Alaska. In that tsunami, 

many villagers ran up the mountains behind the village to safety. The water rose 

above the entranceway and window sills of the Three Saints Church in the village, 

one of the oldest churches in North America. After the waters receded, villagers 

were stunned to see that none of the water had come inside the church! The people 

and the church had been delivered from the dangers posed by that tsunami and 

they continue to consider this event to be truly miraculous. 

The village has a proud history and tradition of subsistence hunting, generations 

of subsistence and commercial fishing and a strong feeling of family and self-reliance. 

Importance of Education, Training and Access to Technology 

Old Harbor has long recognized that a key to its long-term survival and viability 

is the investment in education and training of its shareholders. One example of such 

‘‘investments’’ in our people is the current Director of the Alutiiq Museum in Kodiak, Alaska. This young man received scholarships through our Native Corporation’s scholarship program. He received his Ph.D. from Harvard in anthropology and 

lived with nomads in Russia for nearly two years as part of his studies. Further, 

just two years ago, he became a recipient of a MacArthur Foundation ‘‘Genius’’ 

award for his work in Alutiiq anthropology and archaeology. Also, Katherine Gottlieb another OHNC shareholder is a recipient of that same award. The village feels 

blessed and seeks to do all that it can to ensure that this rich legacy of education 

and achievement continues for its villagers. The work of its Native Corporation is 

one of the keys to achieving that goal. 

In the 40 years that have passed since the enactment of ANCSA, the people of 

the village have worked hard to transition from a subsistence lifestyle to a combination of subsistence and a cash economy. In 1973, few Alaska Native villages, had 

people with the requisite experience to incorporate and run a for-profit corporation. 

It has, therefore, been a long, hard struggle for Alaska Natives in general, to help 

provide economic opportunity for its people, which is still a work in progress. 

In addition to transitioning to a village entity operating under a corporate structure for economic development purposes, the village also has had to deal with the 

challenges, remoteness, and logistical obstacles and costs inherent in living on an 

island with the only transportation to and from the village being by air or water. 

The village still faces these challenges today as treacherous weather, high winds, 

lost access to fishing, and limited and expensive transportation options remain a 

continual way of life for villagers and makes doing almost anything with other parts 

of the state or nation or the world a formidable challenge. As a result, the village 

long ago recognized that it had to take proactive steps through its city, Tribal and 

corporate structure to close some of the technological gaps that adversely impact opportunities for new ways to make a living, obtain an education, acquire health care 

and achieve basic communications options for the village. 

In 2002, OHNC, after identifying the need for a fiber optic cable telecommunication system connecting Kodiak Island and the Western Kenai Peninsula with Anchorage, formed the Kodiak-Kenai Cable Company (KKCC) to engineer, construct 

and operate the first of its kind subsea fiber optic-cable system to serve the Kodiak 

region and provide redundancy to the existing cable system linking Alaska with the 

lower-48 and the rest of the world. 

Over several years, the Corporation, joined by Ouzinkie Native Corporation and 

working with the Alaska Aerospace Development Corporation (AADC), proceeded 

with the design, financing and permitting of the Kodiak-Kenai Fiber Link Project 

(KKFL). Construction of the $38 million dollar project was completed in 2006 within 

budget and ahead of schedule and KKCC began providing service to telecommunication common carriers in 2007. The system, with landing sites in Anchorage, 

Kenai, Homer, Kodiak, Narrow Cape and Seward, serves approximately 10 (ten) 

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percent of the State’s population and provides high-speed broadband connectivity via 

a secure, state-of-the art submarine fiber-optic cable. 

The Company operates as a ‘‘carriers’ carrier’’ offering high-speed, broadband capacity and services to local and long-distance exchange carriers for Internet, telephone and other data and video services to promote full and open competition in 

these remote underserved markets. 

The KKCC system aids national defense and marine safety for one of the largest 

fishing fleets in the world by providing secure telecommunication services to the nation’s largest Coast Guard base located on Kodiak Island. The system also serves 

the Alaska Aerospace Development Corporation (AADC) Kodiak Rocket Launch Facility, located at Narrow Cape on Kodiak Island. As the only access point to secure, 

high speed fiber optic connectivity in the region, this strategic asset is considered 

critical to the development of the Ground-based Midcourse Missile Defense System. 

In addition, just last week the U.S. Military launched a Minotaur IV+ rocket, with 

a TacSat-4 satellite as its payload, into orbit from this launch facility. This would 

not be feasible without the access to reliable, all-weather, high-speed fiber optic 

cable-based broadband that the KKFL project provided. According to news reports 

the satellite will enable a new level of communication coordination among various 

branches of the military. 

A goal of OHNC is to extend the high-speed connectivity that is presently available in Kodiak to the outlying villages of the Kodiak Archipelago. For several years, 

OHNC had a government contract to digitize documents. Because such high-speed 

connectivity was not available in Old Harbor, the work had to be conducted in Anchorage by shareholders of OHNC. That provided high-tech jobs and was most helpful to all who worked on the project. However, had the broadband technology been 

in place in the village, that work could have been carried out in the rural village 

thereby providing high-tech jobs in that remote village that is in dire need of economic opportunities. 

As a SBA 8(a) company performing government contract services, OHNC wants 

to employ as many shareholders as possible. The purpose of our corporation is to 

benefit our shareholders. This drive to employ or otherwise benefit shareholders 

comes from within as well as from the U.S. Government/SBA, whom we consider 

to be our clients in any contract work we secure. However, all parties recognize the 

enormous challenge in finding contracts where work can be performed in a rural 

and isolated village. Doing large contract manufacturing, repairs and construction 

for contracts is not likely to make sense in a rural village. But much electronic and 

computer-based work can be done in remote villages and communities in Alaska and 

across the U.S. if broadband telecommunications infrastructure exists. This includes 

both fiber optic-based backbones as the main highways for the regions and additional fixed and wireless technologies to connect the end users with the backbone 

fiber. 

The improved telecommunications speed and service reliability offered by our fiber 

optic cable enhances economic, educational opportunities and health services for all 

the communities served by this system. The importance of a redundant system is 

underscored by the reliability requirements for a project serving communities and 

other varied and important interests. As designed the system is more than sufficient 

to meet the total current requirements of Kodiak Island and the Kenai Peninsula 

and it may be upgraded as necessary to meet future traffic demand. 

The Need for Broadband in Rural Alaska 

High-speed broadband cable has changed the way the world shares information, 

does business, conducts research and delivers education. Nearly 40 percent of Alaska’s land area (equal to nearly ten percent of the land mass of the 48 contiguous 

states)—the entire western half and North Slope of the state—does not have reliable, high-speed broadband connectivity. It is served instead by sporadic satellite 

service which is plagued by limited capacity and frequent disruptions. Participation 

in the modern global economy requires broadband connectivity. Communities without access to broadband are at a clear disadvantage. Even recent investments in infrastructure for select areas of western Alaska will end up relying on limited microwave middle mile connectivity rather than direct fiber optic interconnections to key 

regional hubs. It is likely that with the growth of mobile devices and the move by 

consumers to robust mobile video and downloadable applications that this new 

microwave infrastructure will reach its service capacity much sooner than originally 

anticipated. 

Effort to Extend Benefits of KKFL to Other Unserved Areas 

Among the benefits offered by the KKFL is the ability to handle large packets of 

telemedicine data. Today, as opposed to prior to the KKFL’s construction, medical 

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specialists in Anchorage and elsewhere are able to assist doctors in Kodiak in the 

diagnosis and treatment, including emergency surgery, of patients in Kodiak, especially when movement of a patient to the mainland is not feasible or safe. This technology helps save lives and improves the level of health and medical care to rural 

Alaska, including particularly Alaska Natives who are oftentimes hard pressed to 

travel to Anchorage for medical care by reason of cost or weather. 

As a result of its successful start up and operation of the KKFL system KKCC 

began to investigate whether these same benefits of such technology could be taken 

to other rural areas of Alaska, including Western Alaska, which is the largest 

‘‘unserved’’ rural geographic region of the United States. OHNC started working in 

early 2009 towards providing a main fiber optic cable backbone to all of western 

Alaska through the construction of the Northern Fiber Optic Link (NFOL) which 

will extend the Kodiak Kenai Fiber Link system from Kodiak Island to the Aleutian 

Islands, Western Alaska and the North Slope with landing points at King Cove, Unalaska (Dutch Harbor), Naknek (King Salmon), Dillingham, Bethel, Nome, 

Kotzebue, Barrow, and Prudhoe Bay (Deadhorse). This is the last remaining geographic region of the U.S. that lacks a main fiber optic backbone, and if the U.S. 

hopes to close the technological gap across the entire country, this area cannot be 

forgotten and it needs to be addressed. 

KKCC plans to continue to operate as a neutral ‘‘carrier’s carrier’’ open to all carriers on an equal and non-monopolistic basis to promote competition among service 

providers. This business model allows KKCC to offer competitive pricing to OHNC 

carrier customers without also competing against them at the local level for retail 

and enterprise customers. This approach would spur further investments in new innovation, competition and increased service offerings for all the residents of Western 

Alaska and the North Slope were it to become a reality at a reduced cost over time, 

thanks in part to Universal Service Funding mechanism and support. In addition, 

the system would support critical fisheries research, climate and oceanic data collection, marine vessel monitoring and tracking (which is increasing through the Bering 

Strait and Arctic as the areas covered by ice diminish in size) Coast Guard activities, national defense, homeland security, health care, education, residential use, 

commerce, business and individual mobile usage. 

Broadband service allows for the transmission of voice, data, and media services 

into homes and businesses at much faster speeds than satellite or landline dial-up 

service. Multiple applications can run simultaneously, including software, music, 

and video downloads occurring in seconds rather than hours, as has been the case 

in many areas of Alaska, and businesses can take advantage of real-time two way 

teleconferencing rather than spending money and time on travel. This is especially 

critical in high-cost rural areas of Alaska. 

Broadband in schools, universities, and libraries supports distance learning, research, and real-time video instruction. In hospitals, doctors’ offices, and community 

clinics, broadband can facilitate remote medical consultations, patient care, and resource sharing, reducing the need for patients to travel long distances to receive 

medical care. Federal, state, and local governments use broadband to provide e-government services to citizens. 

Education—Distance Learning (or e-learning) 

Geographic isolation, limited course offerings (especially advanced courses) and 

shortages of qualified teachers are some of the barriers faced when planning course 

curriculums for students in these regions. The NFOL would improve delivery of education to rural areas whose teachers and students do not have access to the technology resources that are available to other teachers and students in most urban 

area of the U.S. With little opportunities for advanced education in the regions, the 

youth are required to leave their families in order to further their education. 

In small villages once the student population falls below 10 students the state run 

school closes its doors. With high speed broadband that policy could be revisited 

since students could work with teachers and other students online in other parts 

of Alaska or around the world rather than being forced to leave their villages to acquire an education. In addition, in small communities that do not have a full range 

of college prep courses or AP courses, getting students online literally opens up a 

world’s worth of curriculum to them in real time. 

Better Healthcare Through Telemedicine 

Telemedicine is the use of electronic information and telecommunications technologies to support long-distance clinical health care, patient and professional 

health-related education, public health and health administration. Technologies 

used in telemedicine typically are: videoconferencing, the Internet, store-and-forward imaging, streaming media, and terrestrial and wireless communications. The 

74

move to digital health records management places even more burdens on health 

care administrators in rural areas that lack broadband services. 

Telemedicine reduces the high cost of health care allowing patients to be provided 

with tele-consultation and treatment to reveal a significant cost savings in expenses 

towards travel, stay, and treatment at the individual level. 

Telemedicine allows a patient and primary physician in rural areas to consult real 

time with a specialist through two-way video and audio communication. It enables 

a physician to conduct a clinical examination of a patient across great distances and 

deliver their expertise where and when needed, regardless of geography. One such 

example involves a family physician whose patient had a cervical spine fracture. 

Unsure whether the patient needed air ambulance transport to the nearest medical 

facility, the primary provider was able to consult with a neurosurgeon off site in another community. They reviewed the patient’s x-rays and CAT scan, and jointly determined that while the patient did need a prompt referral he did not need to be 

transported by air ambulance, saving cost and time away from work and family. 

The experience of the community in Kodiak after the installation of the KKFL 

system is remarkable. Shortly after the cable was installed, doctors at the Kodiak 

hospital were able to consult with doctors in Anchorage via video conferencing to 

perform procedures to save the arm of commercial fisherman who had severely damaged it in a fishing accident. According to medical staff at the facility, had the fiber 

not been installed, if the patient was forced to wait for transportation to Anchorage 

he may have lost his arm and may have died as a result of the severity of his 

wounds. But with the ability to walk local doctors through procedures via video conferencing with that data stream being carried over the fiber optic cable in high-definition, the outcome for the fisherman was positive. 

In another example, a resident of Kodiak could not be moved by air to Anchorage 

by virtue of the patient’s condition, but needed immediate attention by a team of 

specialists. This was accomplished by the high-definition linkage that fiber optics 

provided to the hospital in Kodiak that was a not available prior to this new technology coming on line. 

In contrast, as we worked to develop the Northern Fiber Optic Link, we heard 

from rural health clinic administrators who tell us the new federal mandate to digital health records will be nearly impossible using current satellite technology. Specifically they calculated it would take 27 hours to upload some of the required 

records if they had to use satellite, whereas with fiber optic cable it would take only 

minutes to comply. 

Public Safety 

The NFOL would provide real time transfer of information necessary to access improved public safety services which greatly improves the ability to resolve public 

safety issues facing these communities, including rural judicial and administrative 

hearings via video conference, staffing of public safety offices, improved hiring processes, sexual abuse and domestic violence issues, alcohol related issues, roadway 

safety, crime lab research, forensic scientific analysis, and enhanced homeland security and national defense capabilities. 

The Village Public Safety Officer Program began in the late 1970s as a means of 

providing rural Alaskan communities with needed public safety services at the local 

level. The program was created to reduce the loss of life due to fires, drownings, 

lost person, and the lack of immediate emergency response. 

The Program was designed to train and employ individuals residing in the village 

as first responders to public safety emergencies such as search and rescue, fire protection, emergency medical assistance, crime prevention and basic law enforcement. 

The presence of these officers has had a significant impact on improving the quality 

of life in the participating villages. Accordingly, the Village Public Safety Officers 

(VPSO) are generally the first to respond to many calls for assistance from community members. 

Sustainable Communities 

Allowing the residents of these regions the educational, employment and 

healthcare opportunities available in today’s world, while preserving their ancestral 

heritage, and improving the quality of life for the communities they raise their families in would be among the many benefits of the Northern Fiber Optic Link project 

as it is with the KKFL. 

Economic Diversification 

Much of the region relies on commercial fishing as its main industry. Tourism related activities, while critical to much of the state, have small impacts on the economies of these communities which are only accessible by air travel, and lack the infrastructure necessary to support large scale tourism. 

75

There will be indirect employment created by access to new information and new 

employment opportunities as a result of expanded and reliable fiber optic based 

service. A well-informed populace may generate new perspectives and ideas that 

could help diversify the region and state’s economy beyond the state’s heavy economic dependency on resource extraction. Such a long-term solution is key in the 

effort to displace revenues associated with oil production and federal spending. 

Proposed System Design and Architecture 

The NFOL system would be a seamless fiber optic cable system with a design that 

is more than sufficient to meet the total current requirements of users and provide 

significant additional capacity to accommodate future demand. 

If fully built out it would act as the backbone for eventual access for the first time 

to robust broadband capacity for 142 rural communities, 143 federally recognized Indian Tribes (25 percent of all Tribes in the U.S.) and a total of 256 federal Tribal 

organizations (nearly 50 percent of all Tribal organizations in the U.S.) thereby connecting the region’s indigenous peoples, hospitals, medical clinics, schools, remote 

university campuses, public safety offices, U.S. Coast Guard communications sites, 

commerce, industry and researchers with real-time telecommunications and Internet 

services. 

Benefits of Expanded Broadband for Research and Science 

The Northern Fiber Link would provide real-time remote sensing and other advanced capabilities for environmental research, dramatically improving timelines 

and effectiveness of oceans research on species migration and populations, temperature fluctuations, and salinity thereby helping to provide early warning of weather 

events and through that provide help to people, including avoiding potential 

epidemics such as bird-flu, climate and earthquake research and other populous-affecting areas of study. This type of system would be very beneficial to the studies 

of Arctic warming which can and is affecting the world. 

After conducting lengthy discussions with members of the scientific community, 

researchers and policy experts, and after review of similar projects and projected 

needs for the Arctic and Bering Seas, KKCC undertook to include in the system 

backbone configuration three Science Node Interfaces for use in the future. Each 

Science Node consists of the ability to service the signal and power requirements 

of the future ocean observatories over cable link separate from the NFOL communication links. The data traffic from the observatories transported over this separate 

cable would then be multiplexed onto the NFOL network at the cable landing station for access by research teams involved with the supported science projects from 

any location around the world. 

Conclusion 

It is apparent to us without having a real-time system deployed in those rural 

areas of the State of Alaska it will be many years until Alaska comes into the 21st 

century economy. With the government funding only small phases at a time, with 

individual carriers there will be no or very little competition in those areas for some 

time to come, if ever, thereby creating unintended monopolies that can and most 

likely would keep prices high and a good portion of that price paid by the government through the Universal Service Funds. What is needed is a backbone such as 

NFOL is proposing that is opened to all carriers at the same pricing therefore creating competition in those rural areas of Alaska to bring down the cost and saving 

the government millions in USF funds in the future. 

KKCC is actively attempting to move forward with the proposed NFOL system 

and is grateful for the opportunity to share with the Committee OHNC’s experience 

to date in deploying high-speed fiber optic telecommunications services to Native 

populations. While OHNC is proud of what it has achieved to date in extending this 

technology to Kenai, Homer and Kodiak and the surrounding area, much more 

needs to be done to remedy the substantial telecommunications gap experienced by 

Alaska Natives. That is why this corporation has worked so hard and expended considerable resources to bring fiber optic connectivity to Kodiak and is trying to extend 

that capability to other Alaska communities, including in particular rural and remote communities in Western Alaska. 

We look forward to working with Committee members in the future to help close 

this enormous service gap, this ‘‘digital divide’’, that exists in rural areas of Alaska 

but in particular in Western and Northern Alaska for the benefit of Alaska Natives 

and non-Natives who live at the far extremities of the United States logistical, commercial and telecommunications links.

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The CHAIRMAN. Thank you, Mr. Marrs, for those comments. 

Ms. Danner, will you please proceed with your statement? 


1006b1.eps 1006b2.eps
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STATEMENT OF ROBIN PUANANI DANNER, PRESIDENT/CEO, 

COUNCIL FOR NATIVE HAWAIIAN ADVANCEMENT 

Ms. DANNER. Aloha, Chairman Akaka and members of the Committee, Senator Murkowski. 

For the record, my name is Robin Puanani Danner, I am the 

President of the Council for Native Hawaiian Advancement, most 

comparable to organizations like NCAI and AFN. The Council is 

governed by a 21 member board of directors consisting of Native 

Hawaiian leaders from across the State and over 150 member organizations. 

I am also the director on the National Board of the InterTribal 

Economic Alliance, which is a consortium of Tribal and Native 

leaders that are working together for economic opportunities in our 

respective States and trust lands, Indian reservations, Alaska Native villages and Hawaiian Home Lands. 

I would like to thank you, Chairman and the Vice Chairman, for 

today’s discussion on Internet infrastructure and the opportunities 

for e-commerce to increase Tribal and Native participation in the 

national and global markets. 

Like American Indians and Alaska Natives, our trust lands at 

home are located in some of the most geographically remote and 

rural areas of the State. Lands in my home land were selected by 

the Federal Government when Congress enacted the Hawaiian 

Homes Commission Act of 1920, a few short 14 years after the Indian Allotment Act of 1906, and were based largely on identifying 

areas that at the time were the least desirable by non-Native interests and plantation owners. 

This is a hard truth which we do not bemoan today, but we have 

to acknowledge to address the reality that as our people were 

pushed to the mountainsides to isolated areas of every county, 

these lands were almost completely ignored as technologies, capital 

sources and infrastructure were planned and deployed in every 

other area of the State over the last many decades. This is likely 

the case in the other 34 States where Native trust lands exist, including Alaska. 

This hard truth haunts all of us today, because while these land 

decisions in isolation from infrastructure development do not seem 

to impact the larger community of our respective States and our 

Nation, the reality is that our lands and our people and our full 

potential have been sidelined a bit, putting a lid on one of America’s most powerful and natural resources as a Country, our ability 

to innovate, to create commerce, to apply ingenuity and self-reliance. And Chairman, to build and thrive where we live, where our 

elders will be laid to rest, where our children are nurtured and 

where we are fully capable to contribute to the national well-being. 

For example, in my trust land homestead on the island of Kauai, 

once fiber optic cabling was made possible by accessing RUS and 

Universal Service Fund, to begin the process of catching our lands 

up on Internet infrastructure, we can see and feel transformation, 

truly. In a few short years of having high speed, commercial quality connectivity in my homestead, we opened the first and only 

business ever to be located in our homestead, the first and only 

time in 90 years, since the enactment of our Hawaiian Homeland 

Trust, to have actual jobs created and located inside the boundaries 

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of my homestead. We incorporated a social enterprise, not owned 

by investors, but owned by Hawaiian community, very similar to 

Tribal corporations and Alaska Native corporations. 

Hawaiian Homestead Technology opened its doors with the resources of people, desks, hardware and software, and one fiber 

optic pipeline the world outside. By partnering with our local community college to deliver computer boot camp for the first dozen 

employees to ever walk to work in our homestead, we went on to 

train and create over 50 jobs, an amazing number compared to the 

tiny population base of most rural communities. 

As a group of Hawaiians in the middle of the Pacific, a single 

fiber optic cable connected us to 10 Tribal and Alaska Native partners in seven States to work on document digitization projects for 

the Department of Defense. An extraordinary journey working 

with, among others, the Mandan Hidatsa Arikira of North Dakota, 

the Zuni in New Mexico, the Osage in Oklahoma, the Aleut in 

Alaska, our friends from Fort Peck in Montana. Three hundred 

more jobs created with our partners. It was another first for us as 

Hawaiians. 

From where we live, we can now work. From where we live, we 

can engage in national commerce. From where we live, we can joint 

venture with other American firms thousahnds of miles away. We 

are experiencing economic transformation. And as a result, our surrounding counties, our State, will be able to tap into the economic 

contributions we know we are fully capable of. 

In closing, our formal testimony, Senator, covers in more detail 

the spectrum of what Internet infrastructure can and will do for 

trust lands and Alaska Native villages, from distance learning to 

tele-medicine, from creating technology firms to call centers, that 

end soruce to Native America over outsourcing to foreign countries. 

We ask the Committee to strongly support the Tribal Broadband 

Fund described in the National Broadband plan and with emphasis 

to make accessible the Universal Service Fund to all trust lands in 

all 35 States, to bring our lands up to par with the rest of the 

Country. 

It was the Universal Service Fund and the RUS at USDA that 

brought electrification and communications to the rural towns and 

farms in the heartlands of the Country. It was visionary and the 

right thing to do 50 years ago, to build that backbone infrastructure for rural America. And it is the right thing to do and just as 

visionary today to do so for Native America and the trust lands established by the Congress. 

Moreover, we ask the Committee to move policy that absolutely 

includes the definition of trust lands and ANCSA lands in the eligibility of incredible capital programs like new market tax credits 

and the CDFI bond guarantee program that Treasury is going to 

roll out in 2012. Eligibility criteria, such as rural and low income, 

have helped the capital markets to seek out these areas for investment. We need trust lands to be an equal eligibility criteria, to ensure that that capital also finds our communities, whether they are 

on the Aleutian Chain or in Molokai or in Montana. 

So I would like to thank you for the opportunity to present our 

testimony for the record and this short summary on the Committee’s important topic. Mahalo. 

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[The prepared statement of Ms. Danner follows:]

PREPARED STATEMENT OF ROBIN PUANANI DANNER, PRESIDENT/CEO, COUNCIL FOR

NATIVE HAWAIIAN ADVANCEMENT

Aloha Chairman Akaka and Members of the Senate Committee on Indian Affairs, 

My name is Robin Puanani Danner. I am the President and Chief Executive Officer of the Council for Native Hawaiian Advancement (CNHA), founded in 2001 to 

enhance the cultural, economic, civic engagement and community development of 

Native Hawaiians. CNHA, with a membership of over 150 Native Hawaiian Organizations, dedicated to addressing the challenges in our communities from education 

to business, affordable housing to cultural preservation, is a statewide advocate 

most comparable to the National Congress of American Indians (NCAI), and the 

Alaska Federation of Natives (AFN). 

I am Native Hawaiian, born on the island of Kauai, raised in the fishing village 

of Niumalu, the Indian reservations of the Apache, Navajo and Hopi, and spent 

many years among the Alaska Native peoples. For the last 13 years, I have lived 

on my Native homestead issued under the Hawaiian Homes Commission Act, with 

my children and husband. My background includes former positions in finance as 

a bank executive, a Tribal Housing Authority executive director, and county housing 

director serving Native populations. 

I am also a director on the board of the Homestead Community Development Corporation, founded to promote commerce and economic opportunities on trust lands 

in the state of Hawaii. In addition, I am a director on the board of the Inter Tribal 

Economic Alliance, founded in 2002 to create jobs and economic development on Indian reservations, Alaska Native villages and Native Hawaiian Home Lands. 

Thank you for your oversight hearing on the topic of Internet Infrastructure: 

Equal Access to E–Commerce, Jobs and the Global Marketplace with a particular 

emphasis on the challenges and potential solutions available to Native communities 

on trust lands established by the Federal Government. 

Native Hawaiians and the Federal Trust Relationship 

As the Committee knows, Native Hawaiians are among the families of Native peoples of the United States, and although not as well known, are included in the federal Indian policy and trust relationship. In 1920, the U.S. Congress enacted the 

Hawaiian Homes Commission Act (HHCA), establishing a federal land trust that 

nearly mirrors the content of the 1906 Indian Allotment Act. In 1959, the U.S. Congress enacted the Hawaii Admissions Act, which includes language to further recognize the trust relationship with Native Hawaiians. Over the last 90 years, the U.S. 

Congress has enacted over 150 statutes recognizing my people as Native, like American Indians and Alaska Natives, using the plenary power authorized under the 

U.S. Constitution to address a myriad of issues. 

Similar to the Office of Insular Affairs for the territorial peoples of the U.S. and 

the Bureau of Indian Affairs for American Indians and Alaska Natives in the Department of the Interior, Congress created the Office of Native Hawaiian Relations 

to continue the process of reconciliation in accordance with P.L. 103–150, the Apology Resolution, and to oversee the trust responsibilities of the United States to Native Hawaiians, with a particular emphasis on the HHCA and the 1995 Hawaiian 

Home Land Recovery Act. 

One of the conditions of Hawaii statehood enacted by the United States was a 

compact between the federal and state governments, to administer the HHCA referenced above through the establishment in 1961 of the state of Hawaii Department 

of Hawaiian Home Lands (DHHL). The Hawaii state constitution incorporates and 

embraces the United States’ trust relationship to Native Hawaiians, which was further strengthened by the Hawaii 1978 Constitutional Convention which established 

a second state agency, the Office of Hawaiian Affairs (OHA). Each of these state 

agencies are public trusts of the people of Hawaii, not representing Native Hawaiians, but rather representing all of the people of our state to deliver on the trust 

mandates established under federal law and state law. There are similar ‘‘Offices 

of Indian Affairs’’ in other state governments, including Utah and Arizona. 

In 2011, the state of Hawaii enacted Act 195, to recognize a Native Hawaiian government, as have been done more than 60 times in other states of the union. In 

2011, this honorable committee, the Senate Committee on Indian Affairs, voted to 

approve the Native Hawaiian Government Reorganization Act, to similarly recognize the self-governance of Native Hawaiians, creating parity with the more than 

560 Native governments in approximately 35 states of the country. 

In summary, the relationship of Native Hawaiians to state and federal governments, mirrors the policies and agencies of our counterpart Native peoples in the 

80

other 49 states. The Department of Hawaiian Home Lands (DHHL) and the Office 

of Hawaiian Affairs (OHA) are Hawaii state agencies with trust responsibilities to 

Native Hawaiians. Similarly, the United States Government has acknowledged its 

federal trust responsibility to Native Hawaiians and administers it through agencies 

such as the Departments of the Interior, Health and Human Services, and Housing 

and Urban Development. 

Native Hawaiian Trust Lands and Internet Infrastructure 

Approximately 200,000 acres of Native Hawaiian trust lands created by the Federal Government exists in every county in Hawaii. 35,000 Native Hawaiians and 

their families reside on these trust lands, in mostly rural communities. The challenges of remoteness, access to capital, limited economic opportunities, and the 

unique characteristics of trust lands are consistent with the challenges in Indian 

Country. 

The hearing topic of Internet Infrastructure: Equal Access to E-Commerce, Jobs 

and the Global Marketplace is exactly on point, and a critical issue not only for Indian reservations, but also our Hawaiian Home Land trust. Just as renewable energy technology and access to it, will be a significant factor in the economic wellbeing of communities across the country, so it is with Internet connectivity which 

is tied directly to backbone infrastructure. The following subject areas are notable 

to the hearing topic and Native Hawaiians: 

Access to Distance Learning—When our trust land communities have qualitative Internet infrastructure, we have been able to maximize opportunities for 

Internet based distance learning. Kamehameha Schools a Native Hawaiian private 

nonprofit institution and rural public charter schools located in trust land areas, are 

able to deliver more efficiently, educational and cultural curriculum to over 7,000 

children statewide. College preparatory, vocational skills, and indeed, the all-important computer skills and use of the Internet are made readily available. The key 

to achieving this reality in every trust land area is Internet Infrastructure. 

Access to Telemedicine—When our trust land communities have qualitative 

Internet infrastructure, healthcare costs have a real chance for cost-savings, as well 

as real-time service access to medical expertise over the Internet. The potential for 

a robust telemedicine program serving rural populations hinges entirely on the 

bandwidth availability and coordinated community based Internet access. The key 

to achieving this reality in every trust land areas is Internet Infrastructure. 

Access to Commerce, Markets and Job Creation—When our trust land communities have qualitative Internet infrastructure, extraordinary opportunities in 

commerce and job creation become possible. For example, in 2003, a small rural Hawaiian home land community was able to launch a successful technology company 

to train and employ more than 50 individuals, and deliver high end document conversion products to commercial and government clients. The company, Hawaiian 

Homestead Technology (HHT), went on to partner over the last 7 years, with the 

InterTribal Information Technology Company (IITC), a consortium of multiple Tribal firms in seven states creating upwards of 300 jobs during peak demand periods. 

Its primary client—the United States military. Internet infrastructure to our trust 

land areas, created efficiencies through the reduction of thousands of square feet of 

storage of documents at government sites, and perhaps most exciting for our employees, the opportunity to keep our troops safe by providing maintenance manuals 

and parts inventories to military personnel at their fingertips. 

The single most important component creating the ability to open HHT in Hawaii 

and each of the Tribal firms in New Mexico, North Dakota, South Dakota, Wyoming, 

Montana, Oklahoma, and Alaska, to employ rural residents and deliver product, was 

access to high speed, commercial level Internet connectivity. The incredible impact, 

beyond economics inside our Native areas, but also to the surrounding areas is 

generational change, monumental change. Economic self determination is the most 

powerful momentum available to trust land communities and peoples. It opens the 

door to possibilities only dreamed of, and lends energy to the pursuit of solutions 

from the inside. 

Another example worth discussion on the topic of E-Commerce, Markets and Job 

Creation, is in micro enterprise and artisan trades. Qualitative Internet infrastructure opens the world to our cultural markets and artisan products, not only creating 

economic self sufficiency on an individual artisan basis, but creating an industry 

that is most meaningful with Native authenticity and control. In several of our trust 

land communities, Internet access has created viable outdoor marketplace spaces to 

build visitor industry commerce where our Native peoples determine the space, the 

interactive engagement, the frame and content of our story telling and sharing. Creating these markets, growing commerce where we live, and reaching patrons, simply 

81

requires qualitative Internet connectivity. It is required in today’s competitive world 

and in today’s business environment 

National Equity and Opportunity Recommendations 

Opportunities to create jobs where our people live, across industry sectors, to deliver services to customers across the nation and globally, is within our reach to create a permanent change to our collective economic futures as Native peoples. We 

must complete the journey. In the middle of this century, breaking open the economic potential of the heartlands of the United States was hindered by the lack of 

utilities, communications and electrification. President Roosevelt and the Congress 

of that day, recognized the potential and put forward bold solutions including the 

creation of the Rural Utility Service at the U.S. Department of Agriculture. The 

same applies today with access to broadband. It is the infrastructure upon which 

commerce in the 21st century is based. It is imperative that the Federal Government not waver in making the long-term investment in providing access to 

broadband for Native communities thereby ensuring that Native communities will 

not continue to be left behind. Whether economic opportunities are in energy, in 

farming or ranching, in government services, or the food service sector, quality 

connectivity is a mandatory component of doing business, of creating jobs, of preparing our youth and fully participating in the prosperity and commerce of the country. 

Fully Fund a Native Nations Broadband Fund as recommended in the National Broadband Plan, to support, strengthen and grow Native and Tribal telecommunication providers that primarily serve trust land areas:

(1) provide technical and financial assistance for regulated service launch to 

help Native governments and communities to assess and plan regulated and 

broadband services;

(2) support administrative and operational costs in High-Cost areas to help Native communities sustain key broadband and infrastructure service in their 

communities;

(3) connect both ‘‘under’’ and ‘‘unserved’’ Native areas to assist Native communities in attaining parity of service and technology through regulated support;

(4) sustain current Tribal regulatory services—the safety net support which 

helps Tribal governments to continue with regulatory telecommunications to 

their communities;

(5) provide Native broadband Lifeline and Linkup Funds to help Native consumers to be able to afford residential broadband service;

(6) provide Native public safety support to ensure appropriate public safety responses in life and death situations;

(7) provide Native broadband mapping to help Native governments and communities to attain essential data for broadband deployment and public-safety planning;

(8) connect key Native public institutions to help Native governments and communities to connect critical public institutions to broadband;

(9) support Native mass media universal access to help Native governments and 

organizations to provide essential public and local information toNative residents; and

(10) provide safety-net broadband mobility network to help Native governments 

and communities to supplement the lack of infrastructure, broadband, or public 

safety networks with a broadband mobility safety-net 911 access network.

Establish Trust Land Areas as Automatically Eligible for Federal Programs Targeted for Rural, Under-Served or Low Income Populations and 

Areas. The 2008 Farm Bill (P.L. 110–234) established language defining Substantially Underserved Trust Areas (SUTA) for the purposes of eligibility for federal 

funds administered by the Department of Agriculture’s Rural Utility Service. This 

definition should be widely applied to all federal programs targeted for rural, underserved or low income populations and areas. 

For example, the New Market Tax Credits program, created in 2000 and administered by the U.S. Treasury Department’s Community Development Financial Institution (CDFI) fund, delivers $3 billion annually in capital incentives through tax 

credits to individuals and corporations to make investments in distressed communities across the country. Eligibility for the program is largely limited to qualified 

census tracts based on median income levels. Utilization of the SUTA definition for 

purposes of eligibility for programs such as the New Market Tax Credit program 

and the CDFI Bond Guarantee program would ensure that trust land areas and NaVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00085 Fmt 6633 Sfmt 6621 S:\DOCS\74030.TXT JACK
82

tive peoples are not left behind in accessing capital to accomplish the enormous 

need for Internet infrastructure. We must complete the journey. We must connect 

the long standing needs of Indian Country and trust land areas to the mainstream 

capital programs developed for rural, underserved and low income populations and 

geographical areas. 

Mahalo for the opportunity to express our priorities as Native Hawaiians, and 

within the larger context of Native peoples in the United States.

The CHAIRMAN. Thank you. Thank you very much, Ms. Danner, 

and this panel. 

I am going to ask one a question of each of you, then I will ask 

Senator Murkowski for her comments and questions. 

President Porter, Tribes currently make up 40 percent of all 

gaming revenue in the Country. If Internet gaming was legalized, 

do you think the Seneca Nation and other Tribes would be able to 

effectively compete in the Internet gaming industry? 

Mr. PORTER. Senator, I don’t have any question in my mind that 

we would be able to compete and we would thrive. So long as the 

rules are fair, as long as we are given the same opportunity, I 

know we can do well in this business. 

But discussion plans envisioned, as I understand it, some notion 

of a head start for the non-Indian gaming interest. So that is obviously not the kind of starting point that you want to have if you 

are going to get into a new business. 

So long as the rules are fair and they are even, I do believe that 

our businesses can do well. 

The CHAIRMAN. Mr. Marrs, your testimony, I like the impacts 

that reliable Internet access has had on the health, safety and education of community members. What types of assistance did your 

corporation receive to develop the infrastructure that allowed for 

these positive outcomes? 

Mr. MARRS. Mr. Chairman, originally we had started a system 

from Anchorage to Kenai, Homer to Kodiak, back to Seward. Old 

Harbor Native Corporation being very small in nature, and not 

heavily funded, was able to get Congress to help out in that system, because of the need for real-time capacity through the missile 

launch system. 

So we developed a sub-sea fiber system that now services Kodiak. 

And in fact, hopefully this week, we will light up through microwave both Ouzinkie and Port Lions, two villages on the island, so 

that they have real-time capacity also. 

Now, what that has done for the community of Kodiak, in discussions with Providence Hospital, it has saved some 17 lives since we 

have lit it, in the sense that the weather was down, they now have 

real-time capacity so doctors in Anchorage or Seattle can be online 

working with doctors in Kodiak and go through operations, or they 

haven’t had to fly them out. They have cut back on their nursing 

staff at night and on weekends, so it saves them a tremendous 

amount of money, because they can monitor everybody on a realtime basis in the hospital beds as if they were in Anchorage. 

So if you extend that out, now, this is a carrier’s carrier system, 

we own the system, we sell capacity to carriers, and then they compete in the retail market, we don’t get into the retail side of it. 

That was the concept of Internet system sub-sea fiber cable, to connect all of Western Alaska, the Aleutian Chain, back up to Prudhoe 

Bay, and supply villages through either microwave and/or wi-fi. 

83

That is an expensive proposition, I guess not in the sense of things 

today, but it is expensive to build that cable as a backbone. But it 

would create competition and bring in the capability of real time 

in all those villages in Western Alaska, which is missing today because satellite can’t handle that kind of load. 

The CHAIRMAN. Thank you, Mr. Marrs. 

Ms. Danner, do you have any comments or recommendations regarding leveraging Federal and other resources to increase Native 

community connectivity? 

Ms. DANNER. Great question and thank you so much. There are 

things that we can do that do not increase the budget, the Federal 

budget. There are existing programs, Federal programs, including 

the Universal Service Fund. But two that I mentioned specifically, 

the new market tax credit, which the Congress has been appropriating $3 billion a year for the last 10 years. And this program 

is a public-private program out of Treasury that helps incentivize 

private capital into disadvantaged areas. 

I truly believe that one of the actions that can be taken without 

budgetary impact is to create the definition of American Indian 

Reservations, Alaska Native Villages and lands and Hawaiian 

Homelands to be automatically an eligible investment area in addition to the two existing criteria that the program has already established, which is low-income and rural. If we just do that, give 

our Native lands an opportunity to be an eligible criteria, the investors will find our lands, will find refinery projects, solar renewable energy projects. They will find the resources that are available 

across our Native lands. And that capital will flow to help in those 

areas, including Internet connectivity. 

In the 2010 Jobs Act, my concern is that Congress passed an 

awesome program that is going to be coming out of Treasury in 

2012, which is the CFI bond guarantee program, already appropriated at $1 billion a year, and it is going to be distributed across 

the Country in $100 million blocks. Amazing what a $100 million 

block could do on Navajo or in Alaska or on Hawaiian Homelands, 

if we could be attractive to those capital sources. And we will be 

attractive if the Congress can embrace, the Committee can support 

and embrace the establishment of American Indian reservations, 

Alaska Native villages and Hawaiian Homelands as an eligibility 

criteria, no funding required, to just open up the capital markets 

to our areas that they have not been looking at heretofore. That 

would be one of my most prominent recommendations to leverage 

what already exists without increasing the Federal budget. 

The CHAIRMAN. Thank you very much. 

Senator Murkowski? 

Senator MURKOWSKI. Thank you, Mr. Chairman. And thank you, 

each of you, for your testimony this afternoon. 

Robin, I think you used the term economic transformation. I 

think when appreciate the world that can be opened up, whether 

it is a village in interior Alaska or out in the Pacific Islands, the 

world that is opened up through access to the Internet truly can 

be transformative when we talk about our economic opportunities. 

I think sometimes in Alaska, we feel a little bit left behind. And 

Carl, I really appreciate your coming all this way to testify because 

this is an important issue. And your written testimony I think was 

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very, very comprehensive in terms of laying out some of the challenges that we face in a large, geographically large State like Alaska, but also how we have taken those challenges and really turned 

them into opportunities to be leaders. I do intend to get Senator 

Tester up to Alaska, and maybe you might need to help us go find 

some fish there, Carl, but to show what we have been able to do 

when it comes to tele-medicine, to the distance learning, and how 

we have figured out how we can provide a connection to real experts, whether it is in education or in health care. 

I was struck by one sentence in your testimony, Carl, talking 

about the size and scope of what we are dealing with. You mentioned that nearly 40 percent of Alaska’s land area, which we have 

586,000 square miles in the State of Alaska, 40 percent of that 

doesn’t have reliable high speed broadband connectivity. You mentioned that this is the entire western half of the State, the North 

Slope area. 

I have had one of my staff folks tell me what that would translate into on a map of the lower 48. And it would essentially be the 

equivalent of Virginia, West Virginia, Kentucky, North Carolina, 

South Carolina, Tennessee and parts of Ohio, having an inadequate, an absolutely inadequate access to what everybody else in 

the Country has come to know and expect, and it is how we operate 

on a daily basis. 

I can tell you that the people of Virginia, West Virginia, Kentucky, North Carolina, South Carolina, Tennessee and parts of 

Ohio would not accept the fact that they could not be part of the 

communications world of this century. And yet we are behind 

things. So this is the significance and the importance of what we 

are doing here. 

I do think it is important that we understand how this, through 

access, we really can make a difference in the lives of so many who 

choose to live in their homelands and want to remain there, and 

how we continue that subsistence lifestyle, how we continue to be 

able to be connected to the culture. And we can be connected to our 

roots through this transformative technology that allows us to be 

connected to the whole world. 

You had mentioned that with the Kodiak Kenai Cable Company, 

what you have done, you have laid the first ever sub-sea fiber optic 

cable system. So we have fiber optics in the State, but we also have 

satellite. I don’t think a lot of folks understand that these differences can impact the community in terms of the benefits that 

are provided by access to Internet Service. How does that make a 

difference out in rural Alaska, the fact that some is made available 

by fiber, some by satellite? How does it all fit together? 

Mr. MARRS. Mr. Chairman, Senator Murkowski, satellite was a 

great tool 20 years ago or 50 years ago. I might put it to you this 

way. There are a certain limited amount of T1 lines that go into 

a broadband width of what we would call an OC3. An OC3 I think 

has like, I believe it is 28 T1 line capabilities. A T1 line, if you take 

and run four movies simultaneously, at the same time, you will fill 

that T1 line. 

The whole process has changed tremendously from mostly voice 

years ago to more and more data, and as we go to video streaming, 

it takes up massive amount of capacity. Satellite can’t handle that. 

85

Satellite can handle maybe up to OC48. And they still have to 

prioritize that. 

So something that should take 5 seconds to download may take 

you 20 minutes, and you may not get it downloaded at all because 

of interruption with sunspots or a multitude of other things. 

Having the capacity, when we built the KKCC system to Kodiak, 

everybody said that is way too much capacity, it is an OC48, you 

will never fill it up. Well, not only did it fill up, we are over capacity. So we just upgraded it. We upgraded it, now we have the capacity of running 30 OC192s. That is a massive amount of space. 

And that will take some time to fill up. 

Now, if we run a fiber optic system around the State back to 

Prudhoe, so we have redundancy, that would fill that up pretty 

fast. Because now you are loading in all the villages all the way 

up Western Alaska, they all have the same access, same capability. 

Today they don’t have that. They don’t have video streaming. They 

don’t have the kinds of things that everybody else has, communication is limited. 

We would serve those through microwave and other processes, 

the wi-fi, that could be available within those villages connected to 

a fiber optic system. As I said earlier, we are hopefully next week 

lighting up the microwave system to Ouzinkie and Port Lions, 

which will provide the same speed as our fiber cable at 156 bits per 

second. So people will be able to use it, be able to do video streaming, doing all the things that they can do, creating jobs within 

those communities. 

We want to build it on, next year we plan to build the same 

thing off to Old Harbor. Old Harbor is just a little farther away, 

takes a little different technology. But we plan to build that out, 

at our own cost. We have spent over a million dollars putting in 

two microwave systems to Ouzinkie and Port Lions, because we 

couldn’t get anybody else to go with us, and we promised we would 

get that system in. So we carried out that promise, we built it out. 

We spent $2.5 million upgrading the system, so we would make 

sure we had the capacity to Kodiak. 

It is a very expensive thing to do. But when you are talking 

about funding health, funding programs for the environment, funding the universities, funding the school systems, over time this will 

save a tremendous amount of money on behalf of the Federal Government that is now spending hundreds of millions with the USF 

funds. 

Since I brought that up, one thing that worried me, as the gentleman from the FCC said in this sort of transformation from USF 

fund to connect America, he was going to make sure that all Tribal 

lands were taken care of. In Alaska, we don’t have Tribal lands. 

And I want to make sure that he is talking about the villages in 

Alaska that have ANCSA lands, they are not Tribal. And that little 

wording can cost us hundreds of millions. So one thing, as a Senator, I think you can make sure they take care of that problem. 

But again you are right. The system from Kodiak up around, 

would be around $400 million to build. But over time, it will save 

ten times that, or a hundred times that, in costs to the Federal 

Government and the State government. 

Senator MURKOWSKI. I appreciate that. 

86

Mr. Chairman, I think it is a reminder that whether it is in Alaska or perhaps in other areas in Indian Country, the rotary dial 

telephone still works. But everybody else in the Country is using 

a smart phone. We have to make sure that we are competing. And 

the way that we compete is to truly have a level of access and 

connectivity that is equal and really working for all of us. 

I appreciate your efforts, and Mr. Chairman, thank you for the 

hearing. 

The CHAIRMAN. Thank you very much, Senator Murkowski, for 

your questions. 

I will do a second round here. President Porter, some Tribes are 

concerned that the current discussion draft for legalizing Internet 

gaming would lead to taxation of Tribal revenues and would open 

up the Indian Gaming Regulatory Act to amendment. Do you think 

Tribes can participate in Internet gaming while still upholding 

Tribal sovereignty? 

Mr. PORTER. The short answer is yes. I think the predicate for 

that is that our self-government and our Tribal regulation be recognized to the extent that there is any Federal legislation to deal 

with the topic. We have our own internal ability to regulate our 

conduct. IGRA, for example, puts a mechanism in place so that we 

have our own gaming regulatory agencies. We provide more in 

terms of staff and resources to the regulation of our own facilities 

than we believe that the State even does with respect to these matters under their authority. 

So it is something that I know that we are quite capable of in 

our Seneca Nation. But I know many Indian nations are fully capable of self-regulating and being able to ensure that competition is 

fair and in accordance with the appropriate rules. 

The CHAIRMAN. Thank you. 

Ms. Danner, based on your partnerships across the Country and 

working knowledge of the needs and similarities among Alaska Natives, American Indians and Native Hawaiians, what can we do to 

enhance equitable connectivity for Native communities across the 

Country? 

Ms. DANNER. First and foremost, I would ask the Committee to 

keep a watchful eye on the Universal Service Fund reforms that 

are being published today and that the FCC will be voting on on 

October 27th. We must not allow the goal post to be moved on Natives. After it was so successfully implemented for rural America, 

not with spotty electrification or spotty phone service, but the fullon backbone infrastructure that was built across the Country that 

today is a benefit to all of the Country by having that backbone 

built. 

We simply cannot allow or afford to look the other way if the reforms move the goal posts on trust lands that did not get to benefit 

from President Roosevelt’s vision for the electrification and communications network. So what we have to do is work with the USDA, 

with FCC and with the capital programs that exist, we almost 

don’t even need to create new capital programs, Senator. The RUS 

is the cheapest capital in the world that is available to electric coops, et cetera. All part of that 50 year ago Universal Service Fund, 

RUS program. What we need to do is take that successful model 

and apply it for the first time in a concentrated way to the dots 

87

on the maps that you have up here in your Committee hearing 

room that got missed by the first wave. We need to have the second 

wave, and to make sure that the reforms of the Universal Service 

Fund are equally, equitably applied to Alaska Native villages, 

American Indian reservations and Hawaiian Home Lands. 

The CHAIRMAN. Thank you very much, Ms. Danner. 

Again, I want to thank this panel very much for your responses. 

It will help us in our work in this area, and we intend to continue 

to work with you. I think over the past few years, we have made 

some great improvement and progress, but we have lots to do, and 

that is what we are looking at. 

So your responses to our questions will help us try to do that. 

I continue to tell you that we need to do this together and get your 

advice, as well, as we move along here. 

So I want to thank our witnesses for participating in today’s 

hearing and for taking a technical issue and making it understandable and relevant. Equitable access to the Internet and related resources is one key way we can help Native communities spur economic development and job creation in their communities. We can 

help close the distances and get better health, education and job 

opportunities into Native communities. 

I look forward to working with my colleagues to continue this 

discussion in Congress. And again, I look forward to working with 

you. 

This hearing is adjourned. 

[Whereupon, at 4:40, the Committee was adjourned.] 

(89)

APPENDIX

PREPARED STATEMENT OF DARRELL GERLAUGH, CHAIRMAN, NATIONAL TRIBAL

TELECOMMUNICATIONS ASSOCIATION

I. Introduction 

The National Tribal Telecommunications Association (NTTA) hereby submits this 

testimony on the very important matter of bringing Broadband and telecommunications infrastructure to Native American communities. 

NTTA is a national trade association representing Tribally owned telecommunications companies and their Native customers. Twelve Tribal Nations are members 

of NTTA having created their own telecommunications services. These twelve Nations are: Cheyenne River Sioux; Tohono O’odham; Gila River; San Carlos Apache; 

Fort Mojave; Salt River Pima Maricopa; Mescalero Apache; Hopi; Standing Rock 

Sioux; Warm Springs; Crow Creek Sioux; and Pine Ridge Sioux communities. Nine 

of the Tribes are regulated telecommunications companies (Cheyenne River Sioux; 

Tohono O’odham; Gila River; San Carlos; Fort Mojave; Salt River Pima Maricopa; 

Hopi; Mescalero Apache and Standing Rock Sioux.) 

NTTA members serve and are a part of their respective Tribal communities. This 

testimony addresses the concerns and recommendations of NTTA. 

II. The Crisis in Indian Country and the need for Broadband Service 

Native American communities are the worst connected communities in the United 

States. 

Ninety-eight percent of all Americans have voice dialtone. Yet only 60–70 percent 

of Native residents are connected, a disparity of over 35 percent compared to nonNative communities. 1 out of 3 Native Americans cannot pick up a land-line phone 

to call 911. (In Navajo land, one person in two cannot pick up a phone to dial 911.) 

It is estimated that less than 10 percent of Native families have access to broadband 

service, nearly a 400 percent disparity compared to non-Native communities. 

This has a dramatic impact on Tribal sovereignty and the ability of Native Nations to provide essential public service to their communities. Government services, 

medical and public safety services, education, economic development, human services and administration of justice are drastically hampered by the lack of high-speed 

advanced technology infrastructure. Internet is still a far horizon in this analog divide for Native America. 

III. Federal Trust Responsibility and the mandates of Universal Service 

under the Communications Act 

The Federal Communications Commission (FCC) is responsible for administering 

the Universal Service access to telecommunications services and basic public interest needs of all subscriber communities. The Federal government has a Trust Obligation to all Native Nations to ensure that they have access to basic telecommunications services and the FCC has embraced a Trust responsibility to Native Nations. 

Yet Native communities continue to lag behind every community in the United 

States in telecommunications connectivity and with the changes in the regulatory 

support mechanisms driving infrastructure to broadband service, Native communities may be left further behind all other communities in the United States. 

The FCC seeks to modernize USF and ICC for Broadband, control the size of the 

USF as it transitions to support broadband, increase accountability, and maximize 

the value of program resources for consumers. As the FCC undertakes regulatory 

reform and transition, NTTA has repeatedly urged the Commission take extraordinary regulatory action to connect Tribal lands and honor the Federal Trust obligaVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00093 Fmt 6601 Sfmt 6621 S:\DOCS\74030.TXT JACK
90

1Section 254(b)(2): ‘‘The Joint Board and the Commission shall base policies for the preservation and advancement of universal. . .’in all regions of the nation’ ’’, and 254(b)(3): ‘‘Consumers 

in all regions of the Nation, . . .should have access to telecommunications and information services. . .that are reasonably comparable to those services provided in urban areas and that are 

available at rates that are reasonably comparable to rates charged for similar services in urban 

areas.’’ 2Section 254(b) (4): ‘‘All providers of telecommunications services should make an equitable 

and nondiscriminatory contribution to the preservation and advancement of universal services.’’

tion to Tribal Nations. While balancing complex industry needs with service solutions, the FCC must deliver palpable results for Tribal lands. 1

IV. Executive Summary of NTTA recommendations to the FCC and need for 

Congressional support and oversight 

The National Tribal Telecommunications Association has submitted policy recommendations to the FCC over the past 7 years urging the Commission to improve 

the targeting of resources to address the crisis of lack of telecommunications service 

(and Broadband) in Indian Country. More recently, the Commission, through the 

Notice of Proposed Rulemakings for a National Broadband Plan and specific 

rulemakings to reform the Universal Service Fund and the Inter-carrier Compensation programs and the prospective Connect America Fund, has sought comments on 

regulatory changes that might impact Native Nations. NTTA is deeply concerned 

that the FCC has been steeped with industry carve-out solutions that do not and 

will not adequately address the needs of Native Nations. 

In the final comments to the FCC, NTTA summarized essential policy changes 

and regulatory waivers and adjustments that must be undertaken if Native Nations 

are ever going to attain parity of service, parity of technology, and parity of infrastructure with non-Native communities. NTTA has recommended (in summary synopsis here):

1) In the upheaval of regulatory change and the fabrication of industry-centric 

solutions, the FCC must not lose sight of the unique needs of and specific solutions for Native communities;

2) To reinforce the sovereignty of Native Nations, the FCC should defer to Tribal Government’s choice of Eligible Telecommunications Carrier (ETC) providers 

on Tribal lands;

3) The FCC must support Native Nation’s efforts to provide their own regulatory solutions;

4) The FCC should extend the Mass Media Native Priority to all communications service support for Native Nations:

5) The FCC should create a Native Broadband Fund to support the deployment 

and adoption of broadband in all Native communities;

6) The FCC should ensure that Tribal Nation’s efforts to serve their communities are adequately funded and sustained;

7) The FCC should consult with Tribal governments and require ETCs to consult with Tribal governments;

8) The FCC should ensure that limited support funding for Native communities 

are predicated on need, not the lowest cost infrastructure proposals by providers.

9) The FCC should adopt a Native Broadband Lifeline and Linkup program;

10)The FCC should provide sufficient spectrum for Native Nations to use for 

public interest needs and broadband service;

V. General Regulatory Policy Recommendations for the FCC and Congress 

Recognizing the need to improve the efficiency of the Universal Service Fund and 

the Inter-carrier Compensation programs in the transition to the Connect America 

Fund, NTTA supports the need to improve efficiency of the federal programs, but 

urges the FCC not to lose sight of the needs of Native communities and the potential growth of the digital and analog divide between Native Nations and non-Native 

communities. 

With a view toward maximizing limited Universal Service Fund dollars, NTTA 

recommends the following:

1) Increase contribution to the USF/CAF to include all services that use the 

Public Switched Telecommunications Network, regardless of technology and category of service; 2

91

3See the Commission’s Twelfth Report and Order; First Rural Radio Report and Order, 47 

U.S.C. § 307(b) (Section 307(b)); Statement of Policy on Establishing a Government-to-Government Relationship with Indian Tribes, Policy Statement, 16 FCC Red 4078 (2000) (Tribal Policy 

Statement); Connecting America: The National Broadband Plan, 146–48 (rel. Mar. 16, 2010). 

2) Limit USF/CAF recipients to one provider in each service area as the Carrier 

of Last Resort;

3) Fund only activities or networks that expand or prepare the Public Switched 

Telephone Network to support Broadband capacity and service reach (pursuant 

to the basic mission of universal service: to support the cost of providing a public network to rural communities);

4) Apply incentives to encourage carriers to move more quickly to expand 

Broadband networks, particularly to unserved areas, without pulling the rug 

out from rate-of-return telecos that are serving markets that have little commercial appeal or viable return on investment.

VI. Tribal Solutions 

The FCC has long recognized the unique relationship with Tribal Nations. 3 Yet 

Tribal lands continue to suffer the results of historic and pervasive under-service 

to Tribal communities. 

NTTA urges the FCC to take extraordinary regulatory actions and target specific 

resources on Native Nations. 

A.The FCC Should Defer the Choice of Eligible Telecommunications Carriers on 

Tribal lands to the Tribal Government 

Discussions about solutions for under-service typically focus on governmental 

mandates and actions or on carriers and their obligations to meet service needs. 

This traditional matrix excludes the most important stakeholder, the consumer, 

from participating in service policy. 

Since Tribal Nations are historic victims of pervasive under-service, the FCC 

should honor the unique relationship between the Federal government and Native 

Nations by deferring the choice of regulatory providers for Tribal lands to Tribal 

governments. By giving Tribal Nations as a consumer the powerful leverage over 

Universal Service support, Tribal governments as consumers may be able to change 

the quality and conduct of service on Native lands. By deferring to and empowering 

Tribal Nations to choose their regulatory providers, the FCC will be strengthening 

the sovereignty and self-sufficiency of Native Nations. 

A corollary to this federal deference to Tribal Nation carrier choice is the obligation by all non-Tribal ETCs to attain legal permission to serve Native communities. 

ETCs need to attain Tribal permission to serve Tribal lands and adhere to all the 

legal requirements of doing business on Tribal lands. (See the later discussion on 

consultation.) 

Another corollary to Native Nation deference is the need for the FCC to honor 

the request by Native Nations to designate their entire Native community (or lands) 

as a single service area. Unifying the entire Native community as a single service 

area strengthens Tribal sovereignty. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

B. The FCC Should Support Tribal Nations’ Decision to Provide Regulatory Service 

to Their Own Community 

The FCC should support Native Nations’ efforts to provide regulatory service to 

their own community. Should a Tribe seek to apply for Section 214(e) (6) ETC status, in deference to the unique relationship between the Federal government and 

Native Nations, the FCC should apply all regulatory resources to support the Tribal 

effort to provide regulatory service to the Native community-including designating 

the Native community as a single service area. The FCC should apply other regulatory relief to assist Native Nations, such as streamlining and expediting certificates of convenience; waiving the parent trap provisions governing support status 

for purchased service areas; waiving Part 36 and other ETC delays for universal 

service support. The FCC should provide such Universal Service or Connect America 

funding and safety-net protections as are needed for Native Nations to serve their 

own communities. 

In the course of Tribal Nations becoming more self-sufficient by choosing to provide their own regulatory services, the FCC should ease the regulatory burdens on 

Native governments and their delegated providers. In previous comments to the 

FCC, NTTA urged the FCC to address needed regulatory changes to that end. 

92

4 Jan. 18, 2001; CC Docket 96–45. 

5 Jan. 31, 2007; CC Docket 96–45. 

6 Again, see the Commission’s Twelfth Report and Order; First Rural Radio Report and Order, 

47 U.S.C. § 307(b) (Section 307(b)); Statement of Policy on Establishing a Government-to-Government Relationship with Indian Tribes, Policy Statement, 16 FCC Red 4078 (2000) (Tribal Policy Statement); Connecting America: The National Broadband Plan, 146–48 (rel. Mar. 16, 2010). 

In the FCC orders for the Mescalero Apache Telecom, Inc., 4 and Hopi Telecommunications, Inc., 5 the Tribal applicants had to seek a series of waivers from 

Commission rules in order to begin immediate service and attain cost recoveries. 

These costly and time-consuming waivers included a waiver of the definition of 

‘‘Study Area’’ from the Part 36 Glossary-Appendix of the rules; 61.41(c) (2), 69.3(e) 

(11), 36.611, and 36.612 of the Commission’s rules. Waiver of section 61.41(c) (2) 

permitted the Tribal telecos to operate under rate-of-return regulation after acquiring access lines that were under price-cap regulation. Waiver of section 69.3(e) (11) 

permitted Tribal teleco participation in the National Exchange Carrier Association, 

Inc. (NECA) common line tariff effective at the close of the approved transaction. 

Waiver of sections 36.611 and 36.612 allowed the Tribal teleco to immediately begin 

receiving high-cost loop support based upon projected costs, rather than historical 

costs. 

In addition, the Tribes had to apply for waivers from section 54.305 of the Commission’s rules. Waiver of section 54.305 of the Commission’s rules permitted Tribal 

telecos to receive high-cost universal service support based on the average cost of 

the lines under their ownership, rather than receiving the same per-line levels of 

high-cost support for which the acquired access lines were eligible prior to their 

transfer from preceding carriers. (This Parent Trap Rule, 54.305(b), should be rescinded, particularly for Tribal telecos purchasing their certificates from previous 

carriers.) 

NTTA proposes the FCC permit Tribal Governments and entities representing 

Native communities automatically receive these waivers as a matter of course in 

deference to Tribal sovereignty and the FCC’s Trust responsibility. 

Embracing these regulatory changes would facilitate the Tribal option to apply 

‘‘self-help’’ to meet the needs of their community and accelerate what will be an uncertain transition path for broadband deployment on Tribal lands. These changes 

will strengthen Native Nations’ efforts toward self-sufficiency and reinforce the sovereignty of Native Nations. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

C. The FCC Should Extend Its Mass Media Tribal Priority to All Sectors of Communications Service Based on Tribal Sovereignty and Pervasive Under-Service for 

All Communications Services on Native Lands 

The Commission has historically called for unique policy treatment for Native 

American tribes because of historic under-service, the Federal Trust Responsibility, 

the Universal Service mandates of the Communications Act, and the Commission’s 

own adopted Tribal Trust Policy. 6 The FCC has given special accord to Tribal governments: ‘‘we are mindful of our obligation to work with Indian Tribes on a government-to-government basis consistent with the principles of Tribal self-governance’’ 

(Mescalero Apache Telecom, Inc. Order, FCC 01–13) The Commission also recognized the public interest need to assist Native communities: ‘‘The Commission has 

recognized that Native American communities have the lowest reported level of telephone subscribership in America’’ (Sacred Winds Communications Inc. Order, DA 

06–1645). 

The Commission can be applauded for taking particular attention to the status 

and plight of Native communities in America in the National Broadband Plan and 

the Connect America Fund and Universal Service Reform proposals. 

Having set up a Native priority for Mass Media licensing, the FCC should extend 

the Native priority to all sectors of Communications service as Native Nations are 

underserved for all forms of communications. NTTA has described the lack of parity 

for wireline, broadband, and spectrum service between Native Nations and non-Native communities. 

Sections 214, 254, 307 and 309 cite the public interest for the FCC to act or intervene on behalf of ‘‘unserved areas’’ and ‘‘underserved’’ customers. Sufficient data 

shows the lack of parity service between Native and non-Native communities for the 

FCC to apply a priority for all Federal Communications Commission resources to 

assist Native Nations. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

93

7 ‘‘We also find that this result is consistent with our obligations under the historic federal 

trust relationship between the Federal Government and federally-recognized Indian tribes to encourage Tribal sovereignty and self-governance and to ensure a standard of livability for members of Indian tribes on Tribal lands,’’ para. 33, Mescalero Apache Telecommunications, Inc.

(Jan. 18, 2001, CC Docket 96–45) 

D. The FCC Should Create a Native Broadband Fund to Support the Expansion of 

Broadband Service to Tribal Lands 

NTTA strongly urges the FCC to create a Native Broadband Fund as the Commission’s National Broadband Plan suggests. 

In previous comments to the FCC, NTTA stated:

‘‘NTTA has commented previously on disparity between Tribal and Native communities and non-Native communities. Over 98 percent of Americans have access to voice dialtone while only 63–69 percent of Native Americans do. This 

is a 30–35 percent disparity. Nearly 50 percent of rural America has access to 

Broadband. Less than 10 percent of Native Americans do. This is nearly a 40 

percent disparity.’’

As the disparity grows, and as the FCC deliberates reducing the support for telecommunications service for current rural providers, the need for establishment of 

a Native Nations Broadband Fund becomes paramount. 

There is an imperative for the Commission to finally deliver on the needs of Native Nations. The FCC acknowledges the unique circumstances of Tribal and Native 

communities as Trust beneficiaries, as sovereign nations, 7 and as victims of historic 

telecommunications underservice. This compels the FCC to target specific funding, 

resources and strategy at meeting the needs of Native Nations and communities. A 

Native Nations Broadband Fund would have the mission of targeting scarce resources to attaining parity of advanced technology for Native Nations and communities. 

NTTA has proposed a ten-title regulatory framework for meeting the broadband 

needs of Native communities. Unlike grant programs under the Department of Agriculture and the Department of Commerce that have previously supported broadband 

efforts in Native communities—and should be promoted and funded for the immediate future—this Commission Native Broadband Fund should be implemented by 

the FCC and funded through the uncapped portion of the Universal Service (and 

the future Connect America) Fund to promote regulatory service to Native communities. 

The proposed 10–Title Fund will support 4 crucial platforms in Native communities to promote both the transition to Broadband service and meet the basic needs 

of every Native community: (1) the Public Switched Telephone Network; (2) the Public-Safety Network; (3) the Public Media Network, and, (4) the Safety-Net Mobility 

Network. 

In order to support adoption in very low-Income and economic devastated areas, 

NTTA recognizes the crucial need to support residential Low-Income customers with 

a Native Broadband Lifeline and Linkup program, along with a program to provide 

community access to the Internet and broadband by connecting Native anchor public 

institutions. 

The NTTA proposal also recognizes several crucial additional activities needed to 

sustain broadband service in Native communities, including Native Broadband mapping, technical planning and adoption assistance, and inclusion of corporate/operational costs required to sustain regulated Native telecommunications services in 

high-cost and remote rural areas. 

The following is NTTA’s proposal to provide comprehensive assistance to Native 

communities to attain regulated Broadband service. 

Key Platforms 

Public Switched Network in Unserved and Underserved Areas: The FCC 

must support deployment of a high-capacity Public Switched Network which serves 

as a foundation to support all technologies and communications services on Tribal 

lands;

Public-Safety Network: The FCC must support deployment and reform of Public Safety Networks in Native Communities, including construction, 911 PSAP reform and reconfiguration, E–911 mapping, and technology interoperability and regional cooperative efforts;

Public-Media Network: The FCC must support deployment of public community 

mass media networks to bring public-safety, governmental, health and education, 

resource, and cultural information to the community;

94

Safety-Net Mobility Network: The FCC must support deployment of Mobility 

Networks as a safety-net backhaul support for and linkage to the PSTN network 

in Native communities;

Support for the Community 

Broadband Lifeline and Linkup: The FCC must ensure that Native residents 

who cannot afford residential Broadband service be able to access the Internet and 

access the educational, economic development, public safety and governmental resources the Broadband provides;

Anchor/Public Institutions: The FCC must help Native Governments to meet 

Tribal public interest obligations by connecting anchor and public institutions to the 

Internet with current and future broadband capacity;

Preserve Existing Tribal regulatory services: The FCC must support Tribal 

efforts to serve their own communities, see discussion below on Tribal Safety-Net.

Essential Activities to Attaining and Sustaining Broadband Service 

Native Broadband Mapping: Because state Broadband mapping efforts have 

failed to adequately or comprehensively map Tribal lands, the FCC should assist 

Native Nations to implement a Native Broadband mapping effort through Native 

planning and management over the project (such mapping should identify barriers 

to broadband deployment and adoption, inventory existing infrastructure, and identify resource options);

Native Planning and Adoption Assistance: the FCC and the RUS should provide necessary financial assistance, and technical assistance for Native Nations to 

plan regulatory and broadband service to their communities;

Native Broadband Sustainability Cost Support: the FCC should support the 

additional operational and corporate costs essential to sustaining a regulatory 

broadband service by Tribal governments (see discussion below on a second-tier Native Broadband Service support.)

How Would a Native Broadband Fund be implemented? 

NTTA is assessing the costs for the Native Nations Broadband Fund. 

NTTA proposes a streamlined approach on Fund administration by using USAC 

to administer and manage the Fund with a Board appointed by the Commission 

comprised of essential Tribal and Native community and industry experts knowledgeable about community telecommunications needs, telecommunications service 

operations, and Tribal and Native regulatory policies. 

Native Broadband Funding will be targeted to ‘‘underserved’’ Native communities, 

defined as communities with: (1) underservice for public switched infrastructure; (2) 

underservice for Broadband service; and, (3) underservice for wireless access. 

Failure by the FCC to target and fund the networks and activities outlined by 

NTTA’s proposed Native Nations Broadband Fund, notwithstanding current fiscal 

constraints on the Federal Government, would be catastrophic for Native Nations 

and would raise serious concerns about the FCC’s and Federal government’s obligation to Native Nations and constitute a severe breech of the universal service mandates of the Communications Act of 1934. Native Nations would continue to be the 

worst-served and least-connected communities in the United States. The social and 

economic costs thereof would far exceed any investments made herein through the 

Universal Service Fund and through the Connect America Fund. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

E. The FCC Should Ensure That Current Tribal Efforts to Serve Their Own Communities are Adequately Supported and Sustained 

Because Native Nations are unique with regard to their sovereignty and unique 

also in their uniform lack of access to advanced technology, the FCC should create 

a Tribal Safety-net Universal Service mechanisms to ensure that Tribes can provide 

regulatory service to their community and remain sustainable. This proposed support for Tribal regulatory service honors the Nation-to-Nation Federal obligation of 

Trust responsibility to Native Nations and assists Native Nations to attain universal access to telecommunications service. 

To ensure Tribal communities can move forward and serve their communities 

without losing support under current USF and future CAF rules, NTTA proposes 

a Safety-net mechanism with two components that will address the current regulatory service rendered by Native Nations and the Native broadband carrier of last 

resort services of tomorrow. 

95

The first component of the Native Safety-Net will hold harmless the support for 

the 8 current operating Native telecommunications services. These Tribal telecom 

providers are providing communications service to their vulnerable communities (in 

1990 census; 6 of the operating Tribes had less than 10 percent voice-dialtone; one 

company has 86 percent of their subscribers on lifeline; another has 700 subscribers 

on Lifeline). 

Under the FCC’s proposed USF reform changes, Tribal Nations that have chartered their own regulatory service to their communities will be devasted. In a survey of Tribes providing their own services, Tribal company A will suffer 25.5 percent 

($1.1 million) loss in support revenues; Tribal Company B will suffer 22 percent 

($2.5 million) loss in support revenues; Tribal Company C will suffer 34 percent 

($372,000) loss in support revenues; Tribal Company D will suffer 8 percent 

($271,000) loss in support revenues; Tribal Company E will suffer 25 percent 

($658,000) loss in revenues; Tribal Company F will suffer 23 percent ($1.4 million) 

loss in revenues; and Tribal Company G will suffer 26 percent ($890,000) loss in 

support revenues. 

Part A of NTTA’s proposed Native Safety-Net, ensures that current regulated 

Tribal services will continue to receive 100 percent of their current rate of recovery 

support. Based on the projected impact of FCC’s proposed USF changes, this Part 

A Native Safety-Net will only require only $8-$10 million to provide full support for 

rate of return costs for Regulatory Tribal services. 

NTTA proposes a Part B (Broadband) Native Safety-Net mechanism to embrace 

the Connect America Fund changes toward Broadband service proposed by the Commission. Under part B, any Tribe providing regulatory Broadband of last resort 

service within a Native community (or land), meeting all CAF obligations, will be 

provided a second tier-support for the excess of regulatory broadband costs over regulatory broadband revenues. NTTA proposes that funding for this mechanism come 

from the uncapped portion of the Universal/Connect America Fund, using base year 

2002 per line support costs. NTTA is uncertain of the cost for the Part B mechanism 

but is willing to project the costs entailed for support the efforts of Native Nations 

to serve their own communities. NTTA hopes to consult with the Commission to calculate the details and cost of the Native Safety-Net Part B Mechanism. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

F. The FCC Should Protect and Promote Tribal Sovereignty by Requiring All NonTribal ETC’s Serving Tribal Lands to Consult With Tribal Governments 

NTTA has commented on consultation with Native Nations by regulatory providers. Tribal consultation should occur at three levels. First, as the FCC (or Federal Government) undertakes policy deliberations that have a substantial or material impact on Native Nations, the FCC (or Federal Government) must include Native governments in policy deliberations prior to implementation of policies that can 

harm or impact a Native Nation. 

Second, for service to a community, an ETC or ETC applicant should consult with 

the Tribal government or Native community to describe the service plan, how the 

provider plans to serve the entire community, how the provider will address quality 

on an ongoing basis, and how the provider will manage customer issues and complaints. The ETC must also secure all the requisite legal requirements for doing 

business in a Native community, including securing rights of way approval, business 

permits, and any additional requirements that a Native Nation may impose on the 

provider. 

Third, consultation should be held between the provider, the FCC and the Native 

Nation on renewal of licenses and certifications, taking into consideration the ETC’s 

compliance with the terms of the ETC application or consultation with the Tribal 

government. Failure to comply with the certification consultation or to comply with 

the terms of licensing or certification or terms of agreement with a Native Nation 

will cause the FCC to de-certify the provider for their ETC status (or rescind the 

licensing) for the Native community or service area. In addition, the FCC may cause 

the ETC or wireless provider to return USF funding accrued from representations 

of lifeline quality of service to the Native Nation. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

G. The FCC Should Ensure Limited Support Monies are Allocated to Tribal Service 

Areas Based on Need, Not According to Lowest Cost Proposed by a Non-Native 

Provider 

In the interest of eliminating waste, fraud and abuse and increasing efficiency in 

the use of the Universal Service Fund, the Commission has focused on driving supVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00099 Fmt 6601 Sfmt 6621 S:\DOCS\74030.TXT JACK
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port for communications service through the lowest cost outcomes—by using reverse 

auctions. 

Unfortunately, for Native Nations, this very principle of economy of scale and bottom-line cost has resulted in the market by-passing Native communities. Native 

communities lie in inherently high-cost areas without market competition and commercial incentives. Therefore, the cost of connecting Native America will be higher 

than non-Native markets. 

That doesn’t mean public support for regulatory service to Native communities 

should not be efficiently managed, rationally calculated or price-driven when reasonable. NTTA focuses on the dual concept of efficiency and need. Outcomes that demonstrate incremental gains in connectivity—regardless of technology—should be 

held as standards and metrics for efficiency, particularly when weighed against 

market costs. When a Native Nation provides regulatory service that increases 

connectivity (and advanced technology parity) on the order of eight hundred or nine 

hundred percent, the Commission and Congress should take note of this model to 

support and improve upon. 

Need is the other essential component for Commission policy priority. Native communities remain the least connected and isolated communities in America. This 

should be a concern for those administering the universal service man date of the 

Communications Act and particularly in light of the Federal obligation to honor a 

Trust responsibility to Native Nations. 

In the Commission’s Mobility Fund proposal, the Commission offered a complex 

strategy of cost auctions stacked nationally to fund mobility networks. However, 

NTTA felt that the e-rate program that has been in place since 1997, administering 

$2.25 billion for schools and libraries should be a good model of efficiency and proven methodologies. The e-rate program prioritizes (universal service) funding through 

the proxy of school lunch programs for need. The Commission can use underservice 

(or school lunch program) or any other proxy for need to drive essential funding to 

communities or service areas. The other efficiency attached to the e-rate program 

is the built-in consultation required to service the beneficiary (substitute ‘‘Tribe’’). 

The e-rate program requires a pre-negotiated contract to be in place (consultation) 

before bids can be submitted for funding. The e-rate program requires the beneficiary to sign-off on vouchers for payment before funds can be released to the service contractor (consultation on quality of service). And the e-rate program has procedures in place to dismiss a non-compliant provider and to replace the provider to 

complete the project (additional consultation.) Why not use a less complicated and 

tried and successful model for service to Native communities? NTTA urges the FCC 

to balance need, with efficiency (and outcomes) in reforming essential support programs for Native communities. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

H. The FCC Should Support Native Low-Income Subscribers With a Native 

Broadband Lifeline and Linkup Program 

NTTA advocates the creation of a Native Broadband Lifeline and Linkup program 

to give low-income residents access to Broadband services. Residential Broadband 

will be unaffordable for a substantial portion of Native communities unless the 

Commission provides support for Native consumers. 

NTTA models the current Enhanced Lifeline program to support an additional 

low-income support down to the final $10 for Broadband service, defined by 4 Mbps 

downstream and 768 Kbps up stream. GRTI’s proposed waiver of NECA tariff #5 

for Tribes may help reduce an additional $20 cost to Native low-income subscribers. 

NTTA similarly proposes a Native Broadband Linkup program to support Native 

subscribers that cannot afford hookup costs to access residential Broadband service. 

Adopting the current low-income Linkup program, NTTA proposes there be support 

for first-time broadband connection charges and equipment to reach Broadband networks. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

I. The FCC Should Provide Sufficient Spectrum for Native Lands to Use for Public 

Interest and Community Broadband Needs 

NTTA has addressed this concern with recommendations for FCC Native spectrum policy in comments filed on FCC’s Native Communications Service Enhancement inquiries. 

The FCC seeks justification for change in the FCC’s spectrum policy and procedures for Native Nations, including either providing spectrum to Native Nations for 

free or at a reserve price. It is a fact that over the past 15 years, NTTA cannot idenVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00100 Fmt 6601 Sfmt 6621 S:\DOCS\74030.TXT JACK
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tify one Tribal Nation that has succeeded in attaining a wireless service license 

through the auctions proceedings or, under the current auctions procedures, have 

been able to use spectrum to provide broadband service or to meet the public interest needs of the Tribal community. 

On the other hand, there is an example of how the FCC was able to help a remote 

Native community get connected with the use of free spectrum with an experimental 

wireless license. The FCC gave the Salt River Pima Maricopa community the use 

of an experimental license to provide spectrum in the 3.425–3.442 GHz and 

3.475.688–3.492.688 GHz band to connect 300 remote Tribal households between 

1998 and 2007 with fixed wireless technology to provide these families with lifeline 

voice dial-tone. The Salt River community eventually connected these remote households over to Saddleback’s basic network. 

In NTTA’s previous submission, it commented:

In light of being the ‘‘least connected’’ communities in America by wireline, 

broadband and wireless service, the FCC must undertake extraordinary measures to meet the telecommunications service needs of Native Nations. NTTA 

urges the FCC to waive auctions and permit Tribal governments exclusive use 

of spectrum through licensing or permit Tribal open access to spectrum in Native areas to meet the public interest needs of Tribal governments—and to further the public convenience and necessity of connecting Native communities.

Section 254(b) of the Act iterates key principles for Universal Service, including 

promoting and monitoring quality of services to be made available at just, reasonable and affordable rates—(b)(1); to provide access to advanced telecommunications 

and information services in all regions of the nation—(b)(2); to ensure consumers 

in all regions of the Nation, including low-income consumers and those in rural, insular, and high cost areas, should have access to telecommunications and information services, including interexchange services and advanced telecommunications 

and information services, comparable to those services provided in urban areas—

(b)(3); but to most importantly to ‘‘such other principles as the Joint Board and the 

Commission determine are necessary and appropriate for the protection of the public interest, convenience, and necessity and are consistent with this Act’’ 254(b)(7). 

Section 307(b) changes have given Tribal nations priority to attaining broadcast 

licenses. 307(b) gives the FCC the authority—in considering applications for licenses, and modifications and renewals to make such distribution of licenses, . . ., 

among the several States and communities ‘‘as to provide a fair, efficient, and equitable distribution of radio services to each of the same.’’ In the voicing the same 

principles of the Native Priority for media license, Section 309(j)(3) of the Act similarly describes the principle of public interest, convenience and necessity in describing the objectives in the design of systems of competitive bidding as ‘‘promoting economic opportunity and competition. . .and by disseminating licenses among a wide 

variety of applicants, including small businesses, rural telephone companies, and 

businesses owned by members of minority groups and women.’’

NTTA has held that competitive auctions are inherently biased against Tribal 

governments and Native communities and thus constitute a regulatory barrier to 

spectrum licensing and spectrum use by Tribal governments and Native communities. In addition to the failure of the Tribal bidding credit program, NTTA feels 

the entire process of auctions bidding is a regulatory barrier for Tribes. Spectrum 

licensing has done nothing to: (1) promote spectrum licensing by Tribes to serve 

themselves; and (2) enhance or increase the ability of Tribes to use spectrum in 

their service areas for public purpose. 

It is unfortunate that the Act spends far greater focus on the method of distribution of spectrum licenses and service distribution than it does on the target service 

beneficiaries. However, in defining spectrum licensing requirements, Section 

309(j)(4)(C) says in prescribing regulations pursuant to competitive bidding, the 

Commission shall ‘‘consistent with the public interest, convenience, and necessity, 

the purposes of this Act, and the characteristics of the proposed service, prescribe 

area designations and bandwidth assignments that promote (i) an equitable distribution of licenses and services among geographic areas, (ii) economic opportunity 

for a wide variety of applicants, including small businesses, rural telephone companies, and businesses owned by members of minority groups and women, and (iii) investment in and rapid deployment of new technologies and services.’’

Section 309(j)(4)(D) adds that the Commission shall ‘‘ensure that small businesses, rural telephone companies, and businesses owned by members of minority 

groups and women are given the opportunity to participate in the provision of spectrum-based services, and, for such purposes, consider the use of tax certificates, bidding preferences, and other procedures.’’ (emphasis added) This language suggests 

the Commission is required to ensure that rural entities and businesses, particuVerDate 0ct 09 2002 09:37 Jun 14, 2012 Jkt 074030 PO 00000 Frm 00101 Fmt 6601 Sfmt 6621 S:\DOCS\74030.TXT JACK
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larly Tribal governments, should be given the opportunity to participate in the provision of spectrum-based services, and to use extra-ordinary procedures to assist 

those efforts by Tribes, including pilot programs outside of competitive bidding 

rules. 

Section 309(j)(2) addresses exemptions to the competitive bidding rules and includes public safety radio services used by State and local governments (surely, 

Tribal governments are included in this definition of governments), that are used 

to protect the safety of life, health and property, and ‘‘are not made commercially 

available to the public.’’ One could argue that because the Native communities are 

the least served communities, heretofore, spectrum has not been made ‘‘commercially available to the public’’ in Native communities. In any case the strong disparity between Native community access to spectrum (and to telecommunications 

and broadband services) should impel the FCC to exempt Tribal governments and 

Native communities from the auctions method of accessing spectrum for community 

and public use—under the principle of public interest, convenience and necessity. 

In Native Nations, governments are responsible for the public safety, health, education and economic development of the entire community and thus would qualify 

for an exception to the competitive bidding rules. FCC would further public interest, 

convenience and necessity by permitting Tribal governments and Native communities to use spectrum to meet their public interest requirements. Native public institutions surely fall within these exempted licensing and allocations of spectrum. 

To exacerbate the problem of auctions licensing, the Tribal bidding credits have 

been a failure for Native governments and communities. Should the FCC insist on 

continuing the auctions method of allocating spectrum on Tribal lands and Native 

communities, NTTA has proposed replacement criteria to apply to any Tribal credits 

for licensing in Native service areas. Foremost among the criteria are (1) the result 

of Tribal ownership of spectrum license, and (2) the ability of Tribal governments 

and the Native community being able to use the spectrum on the Native land or 

community. 

If the FCC ignores Tribal proposals to waive auctions for spectrum in Tribal lands 

or in Native communities, to meet the spirit of the Budget Act Amendments of 1992 

and the Telecommunications Act of 1996 to use auctions to garner funding for federal contribution, the FCC may require (permanently or on a pilot basis) payment 

by Tribes for the exclusive use of spectrum in Native service areas. 309(j)(4)(F) mandates the Commission shall: ‘‘prescribe methods by which a reasonable reserve price 

will be required, or a minimum bid will be established, to obtain any license or permit being assigned pursuant to the competitive bidding, unless the Commission determines that such a reserve price or minimum bid is not in the public interest.’’ (emphasis added) 

In reviewing the outcomes of auctions and licensing results over the past 15 years, 

since the passage of the 1996 Telecom Act, Native Nations and communities have 

not benefitted from spectrum licensing ownership or enjoyed use of spectrum in 

their own service areas. This is a material breach of the universal service mandate 

of the Communications Act and Trust responsibility of the Federal government (and 

Trust policy as adopted by the FCC) to Native Nations. Public Interest demands the 

FCC implement innovative measures and waive traditional regulatory measures in 

order enable Native governments and communities to own spectrum licensing or to 

use spectrum for its own public needs. 

As a catch-all, Section 303(y) of the Act gives the Commission the reserved authority to allocate electromagnetic spectrum to provide flexibility of use, if ‘‘(2) the 

Commission finds, after notice and opportunity for public comment, that—(A) such 

an allocation would be in the public interest; (B) such use would not deter investment in communications services and systems, or technology development and (C) 

such use would not result in harmful interference among users.’’ These conditions 

can be imposed on Native communities in order to allocate electromagnetic spectrum 

for use by Tribal governments and Native communities. 

The wireless (electromagnetic radio) platform is exclusively in the control of the 

Federal Government. Yet it is the least utilized platform for delivering broadband 

to Native communities. Auctions are the key impediment for the full public interest 

use by Native Nations. The FCC can change this outcome with simple and innovative solutions to simply put spectrum in the hands of or for the use of Native Nations. 

The Committee’s and Congress’s support of this policy imperative is crucial to ensuring Native Nations attain telecommunications and Broadband parity. 

VII. Conclusion 

In the flux and upheaval of the FCC’s efforts to modernize the Universal Service 

support system, the Commission must not overlook or retreat from taking specific 

99

8Standing Rock Sioux Tribe has just been approved as an Eligible Telecommunications Carrier and Warm Springs Tribe is applying for ETC approval. 

and innovative measures to meet the challenge of bringing service to the least-connected communities in America. 

The unique status of Native sovereign nations and the unique relationship between the Federal Government and Native Nations requires the Federal Communications Commission and Congress to look outside of customary regulatory processes and traditional means of problem solving to help Native communities. 

The National Tribal Telecommunications Association is comprised of eight Native 

Nations that have embraced the regulatory path to meeting the communications 

needs of their communities. 8 Six of these Native communities had less than ten percent voice service in 1990. That means in 1990 nine of ten residents in these six 

communities could not dial 911 for help. Yet today, these communities have improved their reach to the outside world by a magnitude of nearly eight hundred percent, including providing broadband technology for their communities. 

Having traversed the analog and digital divide, NTTA’s Tribes offer new ideas, 

imperatives to guide federal policy makers, and foundational measures to ensure 

that all Native communities are connected to the world-wide marketplace. 

PREPARED STATEMENT OF HON. MARGIE MEJIA, CHAIRWOMAN, LYTTON RANCHERIA


1006c1.eps
100


1006c2.eps
101

PREPARED STATEMENT OF SHIRLEY K. SNEVE, EXECUTIVE DIRECTOR, NATIVE

AMERICAN PUBLIC TELECOMMUNICATIONS


1006d1.eps
102


1006d2.eps
103


1006d3.eps
104

PREPARED STATEMENT OF JOSEPH VALANDRA, CHAIRMAN, TEHAN WOGLAKE, INC.


1006e1.eps
105


1006e2.eps
106


1006e3.eps
107


1006e4.eps
108


1006e5.eps
109


1006e6.eps 1006e7.eps
110


1006f1.eps
111

Æ


1006f2.eps