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57–830 PDF 2010

S. HRG. 111–580 

UNEMPLOYMENT ON INDIAN RESERVATIONS AT 

50 PERCENT: THE URGENT NEED TO CREATE 

JOBS IN INDIAN COUNTRY 

HEARING 

BEFORE THE

COMMITTEE ON INDIAN AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

JANUARY 28, 2010 

Printed for the use of the Committee on Indian Affairs 

( 

(II) 

COMMITTEE ON INDIAN AFFAIRS 

BYRON L. DORGAN, North Dakota, Chairman 

JOHN BARRASSO, Wyoming, Vice Chairman 

DANIEL K. INOUYE, Hawaii 

KENT CONRAD, North Dakota 

DANIEL K. AKAKA, Hawaii 

TIM JOHNSON, South Dakota 

MARIA CANTWELL, Washington 

JON TESTER, Montana 

TOM UDALL, New Mexico 

AL FRANKEN, Minnesota 

JOHN MCCAIN, Arizona 

LISA MURKOWSKI, Alaska 

TOM COBURN, M.D., Oklahoma 

MIKE CRAPO, Idaho 

MIKE JOHANNS, Nebraska 

ALLISON C. BINNEY, 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 January 28, 2010 ......................................................................... 1 

Statement of Senator Barrasso ............................................................................... 58 

Prepared statement .......................................................................................... 59 

Statement of Senator Dorgan ................................................................................. 1 

Statement of Senator Franken ............................................................................... 87 

Statement of Senator Murkowski ........................................................................... 61 

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

WITNESSES

Edwards, Conrad, President/CEO, Council for Tribal Employment Rights ....... 66 

Prepared statement with attachments ........................................................... 69 

Keel, Hon. Jefferson, President, National Congress of American Indians .......... 13 

Prepared statement with attachments ........................................................... 15 

Laverdure, Donald ‘‘Del’’, Deputy Assistant Secretary for Indian Affairs, U.S. 

Department of the Interior .................................................................................. 3 

Prepared statement .......................................................................................... 5 

O’Neill, Gloria, President/CEO, Cook Inlet Tribal Council .................................. 61 

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

Spoonhunter, Hon. Harvey, Chairman, Northern Arapaho Business Council ... 59 

Prepared statement .......................................................................................... 60 

APPENDIX

Gottlieb, Katherine, MBA, President/CEO, Southcentral Foundation, prepared 

statement .............................................................................................................. 109 

Letters submitted by: 

Hon. W. Ron Allen, Tribal Chairman/CEO, Jamestown S’Klallam Tribe .... 122 

Hon. Robert C. Bear, Tribal Chairman, Shoshone-Paiute Tribes of the 

Duck Valley Indian Reservation .................................................................. 130 

Hon. Henry M. Cagey, Chairman, Lummi Indian Business Council ........... 126 

Hon. Frances Charles, Chairwoman, Lower Elwha S’Klallam Tribe ........... 125 

Hon. Norman J. Cooeyate, Governor, Pueblo of Zuni .................................... 127 

Hon. Gus Frank, Tribal Chairman, Forest County Potawatomi Community ................................................................................................................. 121 

Hon. Dave Lopeman, Chairman, Squaxin Island Tribe ................................ 131 

Thomas M. Moll, General Counsel, Seneca Free Trade Association ............ 135 

Hon. Charlene Nelson, Chairwoman, Shoalwater Bay Indian Tribe ........... 129 

Hon. Gregory E. Pyle, Chief, Choctaw Nation of Oklahoma ......................... 119 

Hon. Larry Romanelli, Ogema, Little River Band of Ottawa Indians ......... 124 

Paulette Schuerch, President/CEO, Copper River Native Association ........ 120 

Hon. Fawn Sharp, President, Quinault Indian Nation ................................. 128 

Andy Teuber, President/CEO, Kodiak Area Native Association; Chairman/ 

President, Alaska Native Tribal Health Consortium ............................. 123, 132 

Marina TurningRobe, President/Principal Partner, M.B.E. Certified, Native American Enterprise, Sister Sky .......................................................... 133 

Miller, Lloyd B., Sonosky, Chambers, Sachse, Endreson & Perry, LLP, prepared statement ................................................................................................... 110 

Moran, Hon. E.T. ‘‘Bud’’, Tribal Council Chairman, Confederated Salish and 

Kootenai Tribes, prepared statement ................................................................. 96 

Philemonof, Dimitri, President/CEO, Aleutian Pribilof Islands Association, 

prepared statement .............................................................................................. 94 

Sanchez, Hon. Merlene, Chairperson, Guidiville Indian Rancheria, prepared 

statement with attachment ................................................................................. 112 

Smith, Hon. Chad, Principal Chief, Cherokee Nation, prepared statement ....... 111 

Page

IV 

Stafne, Hon. A.T. Rusty, Chairman, Assiniboine and Sioux Tribes, Fort Peck 

Indian Reservation, prepared statement ............................................................ 106 

Snyder, Sr., Barry E., President, Seneca Nation of Indians, prepared statement ...................................................................................................................... 91 

(1) 

UNEMPLOYMENT ON INDIAN RESERVATIONS 

AT 50 PERCENT: THE URGENT NEED TO 

CREATE JOBS IN INDIAN COUNTRY 

THURSDAY, JANUARY 28, 2010 

U.S. SENATE, 

COMMITTEE ON INDIAN AFFAIRS, 

Washington, DC. 

The Committee met, pursuant to notice, at 2:48 p.m. in room 

628, Dirksen Senate Office Building, Hon. Byron L. Dorgan, 

Chairman of the Committee, presiding. 

OPENING STATEMENT OF HON. BYRON L. DORGAN, 

U.S. SENATOR FROM NORTH DAKOTA 

The CHAIRMAN. We will begin the hearing now on the issue of 

unemployment on Indian reservations. 

Let me make a brief comment about it. The urgent need for job 

creation on Indian reservations is apparent to everybody. Our Nation’s unemployment rate has now spiked to 10 percent, the highest 

in 30 years. And I will tell you, there are a lot of people in a lot 

of areas on Indian reservations where they would welcome 10 percent unemployment. For Native American communities, in many 

cases the rate is far, far higher. The national average is 50 percent 

unemployment. In the Northern Great Plains, it is 77 percent unemployment. So we have places in this Country that would very 

much welcome a 10 percent rate. 

Unemployment on the Indian reservations is not seasonal. It is 

chronic. It is an abiding unemployment that causes a lot of difficulty. Of the 10 poorest counties in America, I will put up a chart, 

eight of them are on Indian reservations. All eight have very high 

Indian populations. 

[The information referred to follows:] 

2 

Unemployment means poverty, in most cases, despair, high suicide rates, dropout rates, poor health, poor housing conditions. It 

all relates to chronic and very high unemployment. 

We have a lack of access to capital that has stunted economic 

growth, outdated Federal policies, and some cumbersome regulations. There are a whole series of things that we must do to try 

to address this chronic and urgent problem. 

So, we are holding a hearing on the issue of unemployment on 

Indian reservations. We have two panels today. The first is Donald 

‘‘Del’’ Laverdure, who is the Deputy Assistant Secretary for Indian 

Affairs. I am going to ask him to testify first. And then with his 

permission, I am going to ask the other witnesses to join him at 

the table, ask for their testimony, and then we will ask questions. 

The second panel will be the Honorable Jefferson Keel, the President of the National Congress of American Indians; the Honorable 

Harvey Spoonhunter, the Chairman of the Northern Arapaho Business Council in Wyoming; Ms. Gloria O’Neill, the President and 

CEO of Cook Inlet Tribal Council in Anchorage; and Mr. Conrad 

Edwards, the President and CEO of the Council for Tribal Employment Rights, Federal Way, Washington State. 

Let me begin with Deputy Assistant Secretary Del Laverdure. 

Would you please come forward? And your entire statement will be 

part of the permanent record, and you may summarize. 

Without objection, let me ask Senator Tester to provide a more 

proper introduction of the Deputy Assistant Secretary. 

STATEMENT OF HON. JON TESTER, 

U.S. SENATOR FROM MONTANA 

Senator TESTER. No, you did great. I would just say thank you, 

Mr. Chairman. Del is a member of the Crow Tribe in Montana. Del 

is somebody that I have had the opportunity to work with in my 

years as a State Senator in Montana, and years as a U.S. Senator 


128a1.eps
3 

here in Washington, D.C. He is a straight-up guy, quality fellow, 

knows his stuff, and I appreciate your being here, Del. Thank you. 

The CHAIRMAN. You may proceed. Your entire statement will be 

part of the record and you may summarize. Thank you for being 

here. 

STATEMENT OF DONALD ‘‘DEL’’ LAVERDURE, DEPUTY 

ASSISTANT SECRETARY FOR INDIAN AFFAIRS, U.S. 

DEPARTMENT OF THE INTERIOR 

Mr. LAVERDURE. Thank you, Mr. Chairman, Senator Tester, distinguished Members of the Committee. I appreciate the invitation 

to address your concerns regarding unemployment in Indian Country. 

My name is Donald Laverdure and I serve as the Deputy Assistant Secretary for Indian Affairs in the Department of the Interior. 

Addressing job creation in Indian Country is one of Assistant 

Secretary Echo Hawk’s and Secretary Salazar’s top priorities, so I 

do very much appreciate this time. While the nationwide unemployment rate hovers around 10 percent, unemployment in Indian 

Country, as indicated by the charts, can sometimes reach as much 

as 80 percent. Chronic joblessness often seems endemic to many 

parts of Indian Country, plaguing one generation to the next. 

While the remoteness of many tribal communities may offer a 

partial explanation, it doesn’t explain why Indian joblessness lingers for generations despite better economic situations in some adjoining non-Indian communities. Undoubtedly, the need for jobs in 

Indian Country is great and more work must be done. 

We will continue at the Department to proactively work with 

tribes, sister agencies in the Federal Government, this Committee, 

NCAI, large land-based tribes, and everyone else to try to tackle 

unemployment. It is Interior’s goal that this collaborative effort, 

with tribes leading the way, can initiate some near-term and longterm solutions that can turn the corner with unemployment. 

Some tribal nations, due to a variety of factors, have been successful in launching business enterprises and fostering entrepreneurship. We will utilize those successful business experiences to 

inform the path forward for other tribal nations if applicable, and 

businesses, by encouraging collaboration tribal nation to tribal nation. 

It is important, however, to acknowledge that the one size fits all 

approach does not adequately address job creation in tribal communities. The enduring lesson that the Department has learned is 

that job development policies imposed on tribes never succeed. Consequently, it is critical that tribes and tribal organizations be the 

driving force behind Federal policies. 

However, there are longstanding challenges that are common 

across Indian Country. They include lack of collateral access to capital markets, as Mr. Chairman indicated; a lack of sometimes business development environment, separating politics from business; a 

need for improved physical and legal infrastructure; difficulty in 

developing natural resources with overlapping jurisdictions; lack of 

opportunities to develop a skilled workforce; and lack of access to 

information technology. 

4 

Many of these roadblocks are products of a history of the Federal-State tribal relations and have tribe-specific nuances that 

must be addressed on a tribe by tribe basis. 

Perhaps the largest opportunity for economic development and 

job creation in Indian Country today is development of tribal energy resources. As the Members of this Committee are well aware, 

Indian Country offers some of the highest renewable and conventional resource potential in the Nation. Analogous to the President’s push toward a clean energy economy, the Department is 

working with Members of this Committee and their staff, as well 

as officials from the Departments of Energy and Agriculture, to address barriers and hopefully kick start Indian renewable energy. 

Including energy, we are taking several approaches to support 

Indian job creation, and as important, assist in building a strong 

on-reservation economic foundation that encourages small business 

development, establishes markets for goods and services, and develops a skilled workforce. 

After meeting with many tribal officials, we plan to address 

broad issues that are common across Indian Country, combined 

with a focused effort to provide individual tribes with support that 

they need. 

First, the President has stressed interagency cooperation and 

moving beyond longstanding bureaucratic barriers. Like the President’s and Secretary Salazar’s message to collaborate, the Department recognizes the same time of leadership Members of this Committee have provided. In specifics, we appreciate Chairman Dorgan’s communication with Secretary Salazar and Secretary Chu in 

an effort to spur a collaborative and comprehensive Federal effort 

to support energy development in Indian Country. 

As a reflection of that cooperation, I have recently participated 

in a roundtable discussion of jobs in Indian Country between officials of numerous agencies, tribal leaders and Indian entrepreneurs. In addition, I plan to attend discussion with representatives from the Harvard Project who have been working on these 

issues for Indian economic development for some 20 years, as well 

as other Federal agencies, including Commerce and USDA. 

Second, we are looking to improve data collection to clarify the 

picture of unemployment in Indian Country and sharpen our efforts to address it. We have restructured the Labor Force Report 

to more accurately reflect employment conditions in Indian Country. For the first time, the Report will collect information on parttime, seasonal and temporary workers. Data can now be reported 

online and we can provide technical assistance by telephone to assist tribal officials in completing this report. 

As a result of this work to restructure, the Labor Force Report 

will be able to publish more accurate data and we expect to publish 

a new report this summer. 

Third, the Department of Interior and the Office of Indian Energy and Economic Development will continue to deploy financial 

and human resources proactively in Indian communities to provide 

technical assistance, job training and workforce development to address unemployment. We have initiated many programs, and I will 

give you a small snapshot of those, and then conclude. 

5 

The Indian Loan Guaranty, Insurance and Interest Subsidy Program provides Federal guaranties and loan insurance for Indianowned businesses. In fiscal year 2009, the Office of Indian Energy 

and Economic Development used $7 million in appropriations to 

guarantee and insure $85 million of Indian loans. With ARRA, the 

appropriation was $9.5 million and we are seeking to insure $122 

million. 

Indian economic development incubators focus on job training 

and development initiatives in a particular State or region for a 

specific period of time. We have launched these in South Dakota, 

Montana and Maine, and we look forward to continuing those efforts. 

We have a Native American Business Development Institute 

which links tribes with businesses and engineering graduate 

schools to work with tribal leaders to identify business opportunities through feasibility studies and market studies. Today, we work 

with 14 graduate schools to perform 24 separate such studies. We 

are exploring the possibility of integrating tribal colleges and universities who have ground level understanding of these conditions. 

In sum, Mr. Chairman and Members of the Committee, we look 

forward to the continued collaboration working with this Committee, tribal leaders, academic community and private industry to 

address this chronic and very important problem. This collaborative effort should yield progress toward some solutions at the 

local level. 

Through these partnerships and our Nation to Nation relationship with Indian tribes, we can create more opportunities and job 

growth. 

Thank you for your time and I will be happy to answer any questions. 

[The prepared statement of Mr. Laverdure follows:] 

PREPARED STATEMENT OF DONALD ‘‘DEL’’ LAVERDURE, DEPUTY ASSISTANT SECRETARY

FOR INDIAN AFFAIRS, U.S. DEPARTMENT OF THE INTERIOR

Good afternoon, Mr. Chairman and distinguished Committee Members. Thank 

you for inviting me to address your concerns regarding unemployment in Indian 

Country. My name is Donald Laverdure and I serve as Deputy Assistant Secretary 

for Indian Affairs in the Department of the Interior. Addressing the dire need for 

employment in Indian Country is one of Assistant Secretary Echo Hawk’s and Secretary Salazar’s priorities, in addition to law enforcement and education, so we very 

much appreciate the opportunity to testify at this hearing. 

While the nationwide unemployment rate hovers around a distressing 10 percent, 

some reservation face unemployment rates of up to 80 percent. Chronic joblessness 

often seems endemic to many parts of Indian Country, resisting all antidotes, and 

plaguing one generation to the next. 

The need for jobs in Indian country is great, and more work must be done. The 

Department is grateful for the leadership members of this Committee have provided. In particular, we appreciate Senator Dorgan’s communication with Secretary 

Salazar and Secretary Chu in an effort to spur a collaborative and comprehensive 

federal effort to support energy development in Indian country. 

We look forward to working with tribes, other federal agencies, and this Committee to address unemployment in Indian country. The President has stressed the 

importance of interagency cooperation, and moving beyond longstanding bureaucratic barriers. It is our hope that this effort will finally develop long-term solutions 

that break the generational history of unemployment in Indian Country. 

In the meantime, the Department of the Interior will continue to be proactive 

with its resources. We have initiated many programs, projects, technical conferences 

and training programs to address the lack of employment, and intend to continue 

these efforts. Our economic development efforts are two-pronged, with an effort to 

6 

address broad issues that are common across Indian country, combined with a focused approach to provide individual tribes with support needed to facilitate job creation. 

It is unacceptable for many tribal communities in the United States to experience 

third-world living conditions, and this Administration is unwilling to accept these 

conditions as the status quo in Indian Country. 

Background 

American Indians want to honor tribal traditions and culture while achieving better lives for their families. Where provided opportunities, they are willing to work 

hard to accomplish that goal. Some tribal nations, due to a multitude of factors, 

have been successful in launching various business enterprises and fostering Indian 

entrepreneurship. The Harvard Project on American Indian Economic Development 

(‘‘Harvard Project’’) at the John F. Kennedy School of Government honors many of 

these tribes each year. 

Despite the success of some tribes, the 2000 Census tells us that real per capita 

income of Indians is about half of the U.S. level. Many tribes must overcome the 

sheer remoteness or isolation of their reservations to attract private and public capital to their communities. There is no doubt that this is certainly a factor for tribes 

that are trying to build a strong on-reservation economic foundation that encourages 

small business development, establishes markets for goods and services, and develops a skilled workforce. 

Although the remoteness of many reservations from markets and services is a 

partial explanation, it does not explain why Indian joblessness lingers for generations, despite better economic situations in some adjoining non-Indian communities. 

While success in improving the economies of Indian communities has been uneven, we believe that we have a clearer, albeit preliminary, understanding of how 

many have fallen behind the rest of America. 

One thing we know for certain is that a ‘‘one size fits all’’ approach does not adequately address unemployment and under-employment on reservations. That is why 

we are also taking a focused, approach to provide individual tribes with the support 

needed to identify and nurture economic development opportunities that best fit 

their resources, workforce, markets, and culture. The soundness of this approach is 

supported by the work of the Harvard Project. 

While each tribal economy is unique, there are a number of common factors that 

have inhibited tribal job creation. Primary job-development roadblocks include: (1) 

lack of collateral with which tribes and reservation businesses can obtain capital; 

(2) lack of a business development environment; (3) lack of physical and legal infrastructure; (4) difficulty in developing natural resources due to multiple governments 

have regulatory and taxing jurisdiction over development; (5) lack of educational 

and training opportunities to develop a skilled work force; and (6) lack of access to 

modern technology. Many of these roadblocks are products of the history of federalstate-tribal relations, and have tribe-specific nuances that must be addressed on a 

tribe-by-tribe basis. 

As history has shown, poverty and joblessness in Indian Country is not predisposed to a ‘‘quick fix’’. It cannot be solved by simply investing dollars and then 

counting the number of jobs spawned. Many communities need assistance to create 

a foundation, with economies and jobs from the ground up. Indian reservations often 

lack the legal and physical infrastructure that are common in non-Indian communities. Until these underlying and pervasive issues are addressed, reservation unemployment will likely remain intractable. 

One of the lessons we have learned is that job development policies imposed on 

tribes never succeed. Therefore, tribes must be the driving force behind federal policies targeted toward job creation in Indian Country, which is consistent with the 

policy of Indian self-determination. 

The Department recently participated in a national roundtable discussion on job 

creation in Indian Country. This discussion included representatives across various 

agencies in the Federal Government, reflecting the President’s priority of interagency collaboration to address problems in Indian country. More importantly, the 

discussion included tribal leaders, representatives from intertribal organizations, Indian business developers, and labor organizations. These leaders presented us with 

their vision and ideas for creating jobs in Indian country. 

This administration is seeking guidance and a buy-in from tribal leaders for our 

job creation and economic development programs; soliciting their counsel regarding 

which policies are working, and which are foundering. The Office of the Assistant 

Secretary–Indian Affairs, through its Office of Indian Energy and Economic Development (IEED), is working diligently to mitigate roadblocks that stifle business development and job creation in Indian Country. We have put in place many apVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00010 Fmt 6633 Sfmt 6621 S:\DOCS\57830.TXT JACK PsN: JACKF
7 

proaches to provide tribes and Indian entrepreneurs with the knowledge, tools, and 

resources necessary to create sustainable businesses and good-paying jobs. 

Measuring the Problem and Documenting Success 

For the United States to adequately identify and focus on unemployment in Indian country, we must first collect reliable data that will allow us to track progress 

over time. The Department needs a dedicated Indian Affairs economist who can 

work with tribal leaders and academics to assess, document, and address unemployment in Indian country. At present, the only tool available to us to measure unemployment on reservations is the national Indian Labor Force Report (LFR), which 

is intended to be published every other year. 

In FY 2009, the Assistant Secretary asked IEED to evaluate, restructure, and 

publish the LFR in a form that is more accurate and relevant to employment conditions in Indian country. A committee composed of tribal representatives and federal 

program staff was formed to design a web-based data collection tool to improve the 

quality of the report. For the first time, the report will collect information on parttime, seasonal, and temporary workers. Previous reports only identified tribal members as employed or unemployed, resulting in incomplete data. The data can now 

be reported electronically and on-line, and we plan to provide immediate technical 

assistance by telephone to assist tribal officials in completing the report. 

We have provided training for tribes to familiarize them with the new reporting 

tool and to explain how local data should be collected. The revamped report will be 

published in a timely manner, will reflect seasonal employment, and will require all 

tribes to provide current information. As a result of our work to restructure the 

LFR, we will be able to publish accurate Indian country employment data on an annual basis, which will offer better resolution of employment trends in Indian country. We expect to publish the improved LFR this summer. 

In addition to the need for accurate Indian country employment data, there is also 

a need for adequate information on the underlying causes of unemployment in Indian Country, so we can devise appropriate mitigation strategies. 

In May 2007, the Department of the Interior, in partnership with the National 

Congress of American Indians (NCAI), sought the input of tribal leaders to ascertain 

employment conditions in Indian country and provide recommendations on economic 

development at the first-ever National Summit on American Indian Economic Development. This event attracted over 500 tribal and federal leaders, who developed an 

economic development report that contained 100 policy reform recommendations. 

These recommendations have served as a roadmap for developing new programs, 

providing training, and conducting conferences and workshops. However, we believe 

that it is time to revisit the report to assess our progress and reaffirm the findings. 

Therefore, on July 20–22 of this year, we will again join with NCAI to conduct Economic Summit II in Minneapolis, Minnesota, to update tribes on our progress in carrying out their prescriptions for economic progress and job creation. We will also use 

this event to evaluate progress on Indian country economic development, determine 

if our approaches remain valid, and develop additional recommendations. 

Attracting Private Investment to Indian Country 

A critical component of job creation in Indian Country is improving tribal access 

to capital. Ready access to capital markets facilitates business development—both 

large and small—in virtually all other sectors of the American economy. Access to 

capital in Indian Country, however, is difficult to obtain because of certain factors 

related to tribal land and the status of Indian tribes as governments. 

Historically, it has been difficult for American Indians to obtain financing. Much 

of tribally-owned and individual Indian-owned land is held in trust by the United 

States. While trust land preserves a tribal land base and is essential to Indian economic development, it creates difficulties for using the land as collateral for capital 

transactions. Moreover, lenders are reluctant to enter into financing agreements 

with tribes and tribal corporations because of both real and perceived concerns over 

the status of Indian tribes as sovereigns. Financing options for tribes and their 

members are often limited by lack of financial expertise, credit, and financial resources sufficient to support business dealings. 

The Department of the Treasury (Treasury) conducted a series of workshops, surveys and roundtables to examine Indian access to capital and financial services. 

Twenty-four percent of American Indians interviewed told the government that 

business loans were ‘‘impossible’’ to obtain. Treasury’s report estimated that the ‘‘investment gap’’ between American Indian economies and the U.S. overall totaled $44 

billion. The report also found that, despite the fact that 85 percent of financial institutions on or near Indian lands offer deposit accounts to American Indian residents, 

half of those institutions provide only ATMs and personal consumer loans. 

8 

The Department’s Indian Loan Guaranty, Insurance and Interest Subsidy Program seeks to narrow this gap by providing federal guaranties and loan insurance 

for Indian-owned businesses. It has been in existence since 1974 to help Indian businesses secure financing for economic development. In FY 2009, IEED received subsidy appropriations of $7 million to support guarantees and insurance covering approximately $85 million of Indian loans. This program is the single greatest Federal 

resource used by tribes and Indian-owned businesses to secure lender financing, despite the availability of other, larger Federal programs. 

The Loan Guaranty Program accomplishes a lot with a modest amount. For every $1 million in appropriation it allows approximately $13 million in loan guarantees 

to be issued. One of the requirements of the program is that the loan guarantee 

must positively impact reservations or tribal service areas. Therefore, any Indianowned enterprises obtaining a loan guarantee creates job opportunities in areas of 

high unemployment. Based upon past performance, each additional $80 million that 

the program has offered for guaranteed loans can be expected to generate 50 new 

businesses and create or sustain 1,500 jobs to benefit reservations. 

Over the course of 36 years under the Indian Financing Act, the Loan Guaranty Program has administered more than $1.3 billion in loans and loan guarantees. Jobs 

are sustained when existing businesses have access to capital. 

The Loan Guaranty Program has been targeted to reach those Indian borrowers 

showing the greatest potential for spurring their local economies, whether those borrowers are tribes, Indian individuals, or Indian-owned businesses. 

The historic mix of program uses has included many important elements of tribal 

community development, such as starting or expanding businesses that provide 

goods and services. They have also included helping borrowers construct and renovate buildings, develop recreational and resort facilities, refinance debt, obtain permanent working capital, and purchase everything from manufacturing facilities to 

key equipment, real estate, and inventory. 

The Loan Guaranty Program helps Indian businesses whether they are starting 

new businesses, expanding operations at an existing business, revitalizing operations in a changing industry, or rebounding from business troubles. The payoff for 

all this activity is the creation and retention of jobs with decent wages, and opportunities for advancement in communities not often accustomed to growth and expansion. 

By strengthening the economic base of tribal communities, tribal governments located near these businesses tend to progress towards greater independence and self 

determination. Economic growth on the reservation benefits neighboring non-Indian 

communities as well. 

Indian Energy as an Economic Development Engine 

Perhaps the largest opportunity for economic development and job creation in Indian Country today is through development of tribal energy resources. As the members of this Committee are well-aware, Indian Country offers some of the highest 

renewable and conventional resource potential in the nation. The Department is 

working with members of this Committee and their staff, as well as officials from 

the Departments of Energy and Agriculture, to address structural barriers to Indian 

energy development posed by federal policies. 

This Committee has provided great leadership on this issue, and we appreciate 

Sen. Dorgan’s outreach to the Department of the Interior and the Department of 

Energy to identify points of contact to lead a collaborative effort to address barriers 

to tribal energy development. 

Access to transmission facilities and capital markets are the lynchpins of successful tribal energy development. Historically, tribes have often been relegated to being 

merely landlords in business projects involving natural resources on tribal lands, as 

tax and financial regulations provided disincentives to tribal ownership. Many tribes 

want to share as a partner in sustainable natural resource development. 

The Department values the input of tribal leaders. Through many different forums, tribal leaders have communicated to the Department that it is difficult for 

renewable energy projects in Indian Country to realize the full value of tax incentives Congress put in place to promote their development. Tribal leaders say that 

because tribal nations, like states, are not taxable entities under the federal tax 

code, their presence as an equity partner in renewable energy development projects 

means that fewer tax incentives are available to attract other partners and investors. And, because renewable energy projects rely on tax incentives to be competitive, tribal assumption of an equity stake in renewable projects on their land actually discourages development. The Department continues to listen to tribal leaders 

and will collaborate with other federal agency partners to address issues related to 

energy development projects. The Administration would like to find a solution that 

9 

would allow tribes to monetize these tax incentives, and become full partners on renewable energy projects developed on tribal land. A solution in this area would spur 

immediate and significant development of renewable energy resources for the entire 

nation, and quickly increase job growth in Indian country. The Administration is exploring ideas for how to address these issues. 

In addition to lacking access to capital for energy investments, many tribes also 

lack ready access to energy transmission facilities. Again, this dearth of transmission infrastructure in Indian Country impedes job growth, as well as development of rich energy resources. 

The Administration has made building a cleaner, safer, and more efficient national energy grid a top priority. This effort will directly generate countless jobs and 

facilitate the growth of private businesses, including Indian-owned businesses. Tribal nations will and should play an integral role in improving our energy system. 

On January 11th, Assistant Secretary Echo Hawk announced a series of tribal energy transmission system planning workshops over the next several months in Albuquerque, NM; Portland, OR; Bismarck, ND; and Phoenix, AZ. These workshops will 

be conducted by IEED and the Bureau of Indian Affairs Office of Trust Services, 

working in partnership with the Argonne National Laboratory. 

These workshops will help tribal leaders and tribal resource managers develop energy transmission corridors, so that tribes can be a major player in building a 21st 

Century power transmission grid. These two-day workshops will provide information 

and guidance on planning and developing corridors for energy transmission system 

projects on tribal lands, including both electricity transmission and pipeline projects. 

IEED has also joined with the Inter-Tribal Council on Utility Policy (ICOUP) to 

provide training and assistance on the installation of wind machine towers and turbines. And we have collaborated with ICOUP to provide tribal members with training on building affordable, green, energy-efficient housing using straw-bales—an agricultural waste product readily available in the Great Plains. One of our objectives 

with these initiatives is to spur the development of Indian-owned ‘‘green’’ businesses. 

Tribal Development of Natural Resources 

In addition to energy development, sustainable development of other natural resources on tribal lands is another bright prospect in the Indian economic development landscape. Development of these natural resources can provide good, long-term 

jobs in tribal communities. 

Indian Affairs manages 18.5 million acres of forests on Indian trust land, of which 

5.7 million acres is being developed for commercial purposes. In FY 2008, 485 million board feet of timber was harvested which resulted in $50 million in Tribal and 

individual Indian income. Eighty percent of this work was performed via P.L. 93– 

638 contracts and self-governance compacts with tribes. 

The Indian Forestry Program is renowned for its sustainable operations. In addition, this program serves as the driving economic force in many communities. Some 

tribes own their own sawmill operations. When a sawmill component is added to the 

forestry preparation work, logging, trucking and follow-up forestry activities, tribal 

forestry and related activities can be the largest employers of some regions. However, like other forestry efforts, tribal forest programs have suffered from a dampened demand for raw wood products. The Department is looking for ways to sustain 

these job skills until the market rebounds. 

In addition, some tribes have developed additional forest products companies, 

such as plywood plants, that allow tribes to climb higher on the value chain and 

generate more jobs. Also, if a tribe builds an associated biomass cogeneration facility 

for wood waste, it can enhance the economics of the project by producing some or 

all of the energy it will require. 

Supporting Indian Entrepreneurship on Reservations 

Tribal leaders say that fostering Indian entrepreneurship is a critical component 

to successful economic development. Small businesses are the nation’s leading generator of jobs. But this has not been the case for American Indians. Unfortunately 

American Indians have not been able to establish a significant number of small 

businesses. According to a 2003 report by the Kauffman Center for Entrepreneurial 

Leadership, ‘‘Native American owned and started the fewest small businesses of all 

minority groups in the U.S.’’ 

The Assistant Secretary’s Office, through IEED, is developing reservation entrepreneurship on several fronts by: (1) Assisting tribes to improve legal infrastructure 

that will foster business creation; (2) Educating Indian youth in entrepreneurship 

and financial literacy; and (3) Providing training and other technical assistance to 

Indian business owners. 

10 

To facilitate tribal business formation, IEED sponsors workshops to inform BIA 

tribal operations personnel, and tribal managers and attorneys how Indian Reorganization Act (IRA) Section 17 corporate charters are prepared and approved. These 

charters enable tribal businesses to preserve tribal assets while maintaining tax immunity. In addition, we are working with tribes to develop long-term, comprehensive community plans to pave the way for business start-ups. Last fiscal year, we 

collaborated with the NCAI to hold a series of conferences throughout Indian country on reservation planning that will provide us information to develop technical assistance programs for tribes. We anticipate publication of a report on the findings 

of these conferences in the next few months. 

As described above, myriad factors impede the success of Indian entrepreneurs. 

The report from the 2007 Economic Summit recommended that all American Indian 

youth learn basic financial and business concepts, beginning as early as kindergarten. In response to these recommendations, IEED has funded a Native Community Development Financial Institution (CDFI) to develop a financial literacy and 

entrepreneurship training curriculum for American Indian K–12 students in South 

Dakota. 

To date, the program has established teacher training institutes at five reservation schools. Forty-seven South Dakota American Indian students have completed 

financial literacy internships. More than 1,000 Native American students took part 

in the Program’s Youth Entrepreneurship Fair, where they learned hands-on business start-up skills. 

IEED also sponsored entrepreneurial training projects at seven Native American 

high schools and funded students from the Pine Ridge and Cheyenne River Sioux 

reservations to attend the Native American Youth Entrepreneurship Camp, conducted by the Udall Center’s Native Nations Institute at the University of Arizona. 

This camp teaches students how to build private-sector enterprises in Indian country, while conducting student visits to Indian-owned businesses and arranging meetings between students and business owners. 

We have been working one-on-one with Indian business owners to open their 

doors—and keep them open. For example, the Native American Natural Foods 

(NANF), manufactures the Tanka Bar and other bison-meat-based products on the 

Pine Ridge Reservation in Kyle, South Dakota. IEED provided an Indian Affairs 

Loan Guaranty that helped NANF launch a national brand. In addition, we provided funding for 16 tribal members to receive management and marketing training. 

Twelve of these trainees have since obtained jobs with NANF, while the others were 

hired by a non-profit organization. All of these jobs are located on the Pine Ridge 

Reservation, one of the poorest areas in America. 

NANF is just one example out of hundreds, where IEED has provided Indian 

CEOs and entrepreneurs an opportunity to attend an intensive, three-day executive 

education courses offered by the top-rated Tuck School of Business at Dartmouth 

College. These courses focus on helping Indian CEOs recognize and overcome common operational and financial pitfalls encountered by small business owners. This 

fiscal year, 2010, we are offering these training sessions in Boston, Dallas, and Anchorage and expect to reach from 100 to 150 Indian CEOs and entrepreneurs. 

IEED has also conducted workshops in Indian country on how to form Small Business Administration 8(a) businesses and capitalize on federal procurement and BuyIndian opportunities. 

The Office of the Assistant Secretary has worked with the CDFI Fund within the 

Treasury Department to promote the establishment of CDFIs in tribal communities. 

CDFIs are an effective means to provide seed money to entrepreneurs in tribal communities. They also allow tribes the flexibility to meet business lending needs that 

are unique to their communities. Through our own programs, we are able to provide 

support to tribes seeking to establish these lending institutions, in addition to providing direct support to the CDFIs themselves. 

Lastly, we have delivered some of these job development programs by way of what 

we call ‘‘Indian economic development incubators,’’ focusing all of our job training 

and development initiatives on a particular state or region for a specific period of 

time. We have launched these ‘‘incubators’’ in South Dakota, Montana, and Maine. 

We have found this to be an effective means of jump-starting entrepreneurs in finite 

geographic areas. In FY 2011, we will be selecting another area of Indian Country 

in which to launch these incubators, and hope to continue to expand this program 

throughout Indian country as resources become available. 

Supporting Tribal Business Development 

The Department is also helping tribes develop market and feasibility studies to 

determine which kinds of reservation business start-ups are likely to prosper in 

their respective environments. To that end, we initiated the Native American BusiVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00014 Fmt 6633 Sfmt 6621 S:\DOCS\57830.TXT JACK PsN: JACKF
11 

ness Development Institute (NABDI) to link tribes with distinguished business and 

engineering graduate schools to study proposed projects before tribal members invest time and money in them, and work with tribal leaders to identify legitimate 

business opportunities. To date, we have worked with 14 graduate schools to perform 24 separate marketing and feasibility studies. These studies have assisted tribal leaders in making sound decisions on start-ups, and avoiding mistakes that might 

otherwise lead to marketplace failure. We are exploring the possibility of expanding 

this program by integrating tribal colleges and universities, which have a groundlevel understanding of the economic conditions in Indian Country. 

Improving Information Infrastructure and Legal Infrastructure in Indian 

Country 

The Department recognizes as well, that reservation entrepreneurs are hardpressed to succeed without access to information technology and the skills to take 

advantage of that technology that will allow them to compete on a global playing 

field. Information technology is critical to mitigate the geographic isolation of many 

tribes. Nevertheless, many remote tribes do not enjoy access to high speed 

broadband internet use. 

The Department of Commerce, Department of Agriculture and Federal Communications Commission have several current initiatives to provide broadband access 

in rural America. The Department of the Interior supports these efforts for Indian 

Country and we will work to assure that rights-of-way for broadband facilities are 

quickly evaluated and approved on trust land administered by our offices. 

We have also teamed with IBM, Wal-Mart, and the Burlington Northern Santa 

Fe Railroad to develop computer technology centers at seven reservations. At each 

of these locations, IEED-sponsored trainers use computer hardware and software 

donated by corporate sponsors to provide tribal members with training that will 

help them take advantage of information technology and compete in a global marketplace. These centers have become valuable assets for these tribes and we are continuing to look for other partners in the private sector to continue this effort. 

With respect to legal infrastructure, many potential investors in Indian Country 

are deterred by real and perceived concerns about tribal political systems. Attracting private business investment in Indian Country requires a continuous process of 

educating developers and investors about basic legal principles applicable to tribal 

nations and their lands. Many tribal leaders and Indian business developers have 

successfully worked with private companies, from large investment firms to smaller 

businesses, to allay their concerns and attract business development—and jobs, to 

Indian Country. 

Nevertheless, sound legal systems are critical to establishing a climate in which 

job growth is possible. IEED has provided funding for a dozen tribes to explore 

adopting the model tribal secured transactions code developed by the Committee on 

Liaison with Native American Tribes of the National Conference of Commissioners 

on Uniform State Laws, which is an association that encourages uniformity of certain laws. Tribes can adopt and amend this code to fit their own needs and values, 

while providing commercial legal systems familiar to many job-creators. 

As a result of this funding, the Oglala Sioux Tribe signed a ground-breaking 

agreement with the State of South Dakota for administration of commercial transaction filings under the tribe’s new code. This was the first such tribal agreement 

in the history of the state. We believe that other tribes will follow the Oglala Sioux 

Tribe’s example by adopting their own commercial codes. 

We will continue to use small grants to enable tribes to evaluate, modify and, ultimately, adopt uniform commercial codes into tribal law, smoothing the flow of commerce on reservations. 

Training Skilled Work Forces 

We are developing partnerships with tribes-through the Pub. L. 102–477 initiative—on a nation-to-nation basis to develop creative and innovative training programs that provide participants with work skills that lead to well-paying careers. 

The ‘‘477’’ initiative allows tribes to develop their own employment, training, education, job creation, and related services programs for their own communities. Tribal 

Nations develop their own programs based upon their own needs. In addition, U.S. 

Department of Labor provides funding to the 53 tribal grantees administered by the 

U.S. DOI’s PL 102–477 to develop tribal employment and training programs on Indian reservations and Alaska Native communities. The U.S. Department of Labor’s 

Employment and Training Administration, under Section 166 of the Workforce Investment Act of 1998, funds and administers more than 178 employment and training grants to Indian Tribes, Tribal Consortiums, and Tribal Non-profits. 

12 

Rebuilding America’s infrastructure will require the skills of thousands of working 

men and women. To address this opportunity, IEED and the United Association of 

Plumbers and Pipefitters entered into a partnership agreement to initiate a pilot 

project to train tribal members to become certified welders, plumbers and pipefitters. This project is a demonstrated success. 

Chicago’s Local 597 and Phoenix’s Local 469 were the first to provide hybrid welding training for Indian apprentices. The payoff has been enormous. Graduates of 

these programs are rated as two-year apprentices. They have a 100 percent job 

placement rate, earning about $20 per hour to start. One of the recent graduates 

of the construction training went from being on general assistance to a job that paid 

him $27 per hour. 

IEED has also been part of a long-term collaboration with the National Indian 

Iron Workers Training Program to conduct training in four, 12-week long sessions, 

graduating about 100 Native Americans annually who are qualified for skilled employment. Since 1972, this program has trained, graduated and placed 2,084 individuals in well-paying jobs that currently rebuild our Nation’s infrastructure. As 

with the plumbers and pipefitters program, placement is 100 percent. 

IEED estimates that it can train and place about 450 American Indians and Alaska Natives per year for the next four years to fill these jobs in the skilled trades. 

IEED’s data indicates that it costs between $5,000 to $10,000, depending on location, to supply the job skills necessary to move an individual from general assistance to a well-paying job. 

The Department is working to expand this pilot project into the other 13 building 

trades, in partnership with the National Association of Building Construction 

Trades. This agreement encourages work with all of the 13 building construction 

trades to train and place American Indians and Alaskan Natives in life-long careers—not just short-term jobs. Billions of dollars of work on and near Indian reservations are pending and tribal representatives want their tribal members to be 

prepared to take on those jobs. 

As a result of our work with the National Association of Building Construction 

Trades, we have developed a formal agreement with the United Association of 

Plumbers, Pipe Fitters, Sprinkler Fitters and allied trades, (UA). 

Now that we have demonstrated its value and have gained some experience, we 

are beginning to work in cooperation with tribal colleges and provide training on 

reservations. Our Energy Auditor Training program, funded by the American Recovery and Reinvestment Act started on January 4, 2010, and is located at the United 

Sioux Tribes Technical College, attracting students from across the country. Upon 

successful completion of the training, graduates will be placed to work on Indian 

reservations on residential and commercial projects to reduce reliance on nonrenewable energy sources. Another example is our project on the Lummi Nation Reservation—a tribally-owned welding training company. 

Our work with tribes and the skilled trades has expanded to the International 

Union of Bricklayers and Allied Craftworkers, the United Union of Roofers, 

Waterproofers and Allied Workers, and the International Brotherhood of Electrical 

Workers. We are currently meeting with other skilled trades in hopes of creating 

training opportunities for Native American commercially licensed drivers and heavy 

equipment operators. 

The skilled trades provide real wages for real work with benefits such as annual 

and sick leave, medical insurance, on-going training and life insurance. These 

projects provide services to the community that lack careers with nationally certified 

skills. 

Our job-training efforts are being done in partnership with the Council for Tribal 

Employment Rights and the Native Construction Careers Institute, both of which 

have been active leaders in supporting job creation throughout Indian country. The 

U.S. Department of Labor, U.S. Department of Education and the U.S. Department 

of Health and Human Services are also active leaders in supporting job creation in 

Indian Country. 

We are also planning to include additional advanced training programs to include 

other occupations, such as Advanced Certified Nursing Assistance. We know that 

there is a vast shortage of medical professionals in Indian country, which is continuously confirmed by Tribal leaders. 

Conclusion 

Once again, the Department looks forward to working with other federal agencies, 

this Committee, tribal leaders, and the academic community to address chronic joblessness in Indian country. This collaborative effort will allow us to implement solutions at the national, regional, tribal, and community level. It is only through this 

13 

type of collaboration, and a nation-to-nation relationship with Indian tribes, that we 

can succeed in spurring economic development and job growth in Indian country. 

This concludes my statement. I would be happy to answer any questions the Committee may have. 

The CHAIRMAN. Deputy Assistant Secretary Laverdure, thank 

you very much for your testimony. With your permission if it is all 

right, I would like to call up the other four witnesses to join you, 

and then have them present testimony, and then ask questions of 

all of them. That is a little bit of a departure from the way we 

would normally do it, but I think in light of the two votes that will 

occur soon, I want to do it that way. 

Jefferson Keel, President, NCAI. Jefferson, thank you very much 

for being with us today. The Honorable Harvey Spoonhunter, Ms. 

Gloria O’Neill, Mr. Conrad Edwards. I have previously introduced 

the four of you. 

Let me begin with Jefferson Keel, the President of the NCAI. 

Thanks for all of your work, Mr. Keel. It is so nice to have you in 

front of the Committee again. 

I will say for all of you that your permanent statement will be 

made a part of the permanent record, and you may summarize 

your testimony today. 

Mr. Keel, welcome. Why don’t you proceed? 

STATEMENT OF HON. JEFFERSON KEEL, PRESIDENT, 

NATIONAL CONGRESS OF AMERICAN INDIANS 

Mr. KEEL. Thank you. Senator, Members of the Committee, 

thank you for holding this important hearing. This is, indeed, an 

important event for Indian Country and I want to thank you on behalf of the National Congress of American Indians. 

I also want to thank you for your continued championship of and 

your support for Indian Country. It is very important to us. I am 

very sorry to hear you leaving, Senator, but hopefully it will be a 

Bret Favre move and you can change you mind anytime. 

[Laughter.] 

Mr. KEEL. Senator, as you mentioned in your opening remarks, 

the creation of jobs in Indian Country is an important event. This 

Committee is certainly aware of the severe unemployment crisis in 

Indian Country. The Congress and the Administration needs to 

know as they move to address the Nation’s unemployment crisis, 

as you mentioned, that the unemployment rate exceeds 50 percent 

in Indian Country. 

So getting to 10 percent that the President mentioned last night 

in his State of the Nation address, the 10 percent crisis or unemployment rate in America, getting to that rate would be a recovery 

of historic proportions for Indian Country. 

Indian reservations have been dealing with the ripple effects of 

depression-like unemployment rates for decades. Effects like high 

suicide rates, poor health and high crime, all have been frequent 

topics of this very Committee’s agenda. 

We need a long-term fix. It is absolutely imperative that a jobs 

bill developed with the help of this Committee consider placing reservation economies on the road to recovery. Now is not the time to 

simply create short-term jobs that run out when the grants expire 

or the funding dries up. 

14 

We must put forward bold solutions that match the severity of 

the crisis. We need to make sure that infrastructure monies are 

spent on programs that put our ready labor force to work, while 

building long-term foundations for future growth, programs like 

putting our people to work on building our schools that will educate tomorrow’s leaders, or programs that put our people to work 

building roads that will pave the way for attracting businesses to 

our communities, and finally making sure our workers are building 

tomorrow’s infrastructure to meet the competitive demands of the 

new economy in areas like energy and telecommunications. 

Creating jobs and building our infrastructure for future growth 

is vital. However, sustaining the growth beyond the Federal investment means access to capital and incentives. We can no longer accept seeing wealthy county governments receive taxpayer-subsidized rates and terms when they borrow money for economic development, while tribal governments have to receive higher rates 

with shorter terms; or private investors reaping the rewards of accelerated depreciation and tax credits, while tribes come to the 

table empty handed. 

We can no longer accept insurance company redlining of reservations for surety bonding purposes or rating agencies’ increasing our 

payments simply because they are unfamiliar with tribal governments and the meaning of sovereignty. We need loan guaranties for 

tribal governments that will, at the very least, open the door to 

credit, reasonable rates, and the ability to repay tax-exempt debt. 

Finally, Congress should consider simple and long overdue legislative fixes that will open existing programs and services to tribal 

governments. These low-cost solutions would ensure tribes are included in the programs and services that other governments use to 

benefit their citizens and grow their economies. 

Tribes have been inadvertently left out of programs to advance 

energy independence, create and maintain clean water resources, 

and core education initiatives like the Administration’s Race To 

The Top. These fixes are needed now to give our governments the 

same tools and advantages that other governments of our great Nation receive. 

When Congress invests in Indian Country, we have proven to be 

good investments. We can put our labor force to work right away, 

build our infrastructure for future growth, and that benefits the 

surrounding communities as well. 

Most important, it improves the health and well being of our citizens. That is the goal of every government. Senators, the time is 

now to boldly place our reservation economies on the path to recovery with the rest of the Nation. 

I want to thank you for your time. 

[The prepared statement of Mr. Keel follows:] 

15 

PREPARED STATEMENT OF HON. JEFFERSON KEEL, PRESIDENT, NATIONAL CONGRESS

OF AMERICAN INDIANS


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The CHAIRMAN. Mr. Keel, thank you very much, and thanks for 

your leadership at NCAI. We appreciate that and are happy to 

work with you. 

Next, we will hear from the Honorable Harvey Spoonhunter. I 

know that because of the votes that are going to occur, I didn’t call 

for opening statements. I know some of my colleagues have some, 

so when I recognize them for questions, perhaps we can integrate 

opening statements as well. 

Mr. Spoonhunter, you have come a fair distance to be with us. 

We appreciate your being here. 

Senator Barrasso, did you want to say a word about Mr. 

Spoonhunter? 

Senator BARRASSO. Well, yes, I would. 

STATEMENT OF HON. JOHN BARRASSO, 

U.S. SENATOR FROM WYOMING 

Senator BARRASSO. Thank you very much, Mr. Chairman. I want 

to thank you for holding this oversight hearing today, and I want 

to begin by welcoming my friend Harvey Spoonhunter, who is 

Chairman of the Northern Arapaho Business Council in our home 

State of Wyoming. 

And I want to welcome also our other guests. I thank all of you 

for being here. 

Mr. Chairman, I asked Chairman Spoonhunter to testify today 

because, as a tribal leader on the Wind River Indian Reservation, 

he struggles daily with the problems of high unemployment among 

his people. According to a 2005 Bureau of Indian Affairs report, the 

Northern Arapaho Tribe’s unemployment rate was 73 percent and 

Eastern Shoshone’s was 84 percent. Well, that was five years ago, 

before the current recession gripped our Nation. 

The employment situation on the Wind River Reservation is not 

unusual. Other reservations have similar or even higher rates of 

unemployment. While not everyone agrees on how to address this 

problem, there does seem to be a consensus on what some of the 

contributing factors are. 

Mr. Chairman, with your permission, I will add the rest of my 

statement to the record, but I would like to once again join the 

Committee in welcoming our good friend Harvey Spoonhunter. 

Thank you, Mr. Chairman. 


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59 

The CHAIRMAN. Without objection, we will include the rest of the 

statement. 

[The prepared statement of Senator Barrasso follows:] 

PREPARED STATEMENT OF HON. JOHN BARRASSO, U.S. SENATOR FROM WYOMING

Thank you, Mr. Chairman, for holding this oversight hearing today. 

Let me begin by welcoming Harvey Spoonhunter, Chairman of the Northern Arapaho Business Council in my home state of Wyoming. Thank you, Chairman 

Spoonhunter, for traveling so far to be with us here today, and the same thanks 

go to President Keel of NCAI and Gloria O’Neill of Cook Inlet Tribal Council in Anchorage. I thank all of you for traveling such great distances to give us your views. 

Mr. Chairman, I asked Chairman Spoonhunter to testify today because as a tribal 

leader on the Wind River Indian Reservation, he struggles daily with the problem 

of high unemployment among his people. According to a 2005 BIA report, the Northern Arapaho Tribe’s unemployment rate was 73 percent and the Eastern Shoshone’s 

84 percent. That was 5 years ago, long before the current recession gripped our 

country. 

Sadly, the employment situation on the Wind River reservation is not at all atypical. Other reservations have similar or even higher rates of unemployment. 

While not everyone agrees on how to address this problem, there does seem to 

be a consensus on what some of the contributing factors are. One example is lack 

of adequate physical infrastructure—good roads and bridges, public water supply 

and sanitation facilities, and adequate housing. Another factor, which is not unrelated to the infrastructure problem, is access to private capital. 

As recent events have reminded us all, the financial sector is a critical component 

of a healthy, vibrant economy. And yet during the 19th and most of the 20th Centuries, there was almost no financial sector in Indian Country. That has changed 

in recent years, but barely. 

Again, no doubt there are many explanations for the lack of private capital on Indian reservations, but we should do all we can to identify those reasons and then 

propose solutions. Simply putting a new paint job on old government programs will 

not be enough. 

In fact, Congress alone cannot solve the problems of unemployment and lack of 

economic development in Indian Country. We must work with tribal governments 

and organizations to find new ways to incentivize private sector investment, to give 

them the tools they need to attract investment in energy projects and other nongaming enterprises with long-term economic viability. 

I hope the witnesses can provide the Committee with ideas on how the Congress 

can help turn reservation economies around. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Mr. Spoonhunter, welcome. You may proceed. 

STATEMENT OF HON. HARVEY SPOONHUNTER, CHAIRMAN, 

NORTHERN ARAPAHO BUSINESS COUNCIL 

Mr. SPOONHUNTER. Chairman Dorgan, Vice Chairman Barrasso, 

Members of the Committee, thank you for the opportunity to share 

with you some of the information that will hopefully be helpful to 

you as you look for ways to assist Indian Country reduce the unemployment rate and help Native people free themselves from the 

bonds of poverty and, in some cases, despair. 

I know that the time of the Committee is limited, so my remarks 

will be brief, but I hope helpful. Let me begin by providing some 

basic facts about the Wind River Indian Reservation. The Wind 

River Indian Reservation is located on 2.2 million acres in central 

Wyoming. It is the only reservation in the State of Wyoming. We 

share the reservation with our neighbors to the west, the Eastern 

Shoshone Tribe. 

The unemployment rate on the reservation exceeds 73 percent, 

as stated by Mr. Barrasso, and over 60 percent of the households 

live below the poverty line. With the opening of our three relatively 

60 

small casinos, the marketing of our organic beef from the Arapaho 

Ranch to Colorado-based food stores, and our sponsorship of the 

tribally-chartered Wind River Health Systems, a federally supported rural health system, we have begun to provide meaningful 

jobs outside of tribal government for our members. 

Obviously, there are many issues that are specific to the Wind 

River Reservation that I could discuss with you that would help my 

specific tribe and reservation. However, I would like to take my 

time with you this afternoon to discuss two important issues that 

affect all reservations throughout Indian Country. 

The Northern Arapaho believe that two changes to the tax code 

would be most helpful in creating jobs in Indian Country. We 

would like to see an elimination of the sunset provisions in the 

property depreciation schedule and the Indian employment tax 

credit. 

Specifically, section 168(j) of the Internal Revenue Code has for 

many years provided an accelerated property depreciation schedule 

for certain property on Indian reservations. The property tax provision allows businesses to depreciate that property twice as quickly 

as it could be depreciated outside a reservation. 

Second, the Indian employment tax credit allows businesses to 

take a 20 percent employment tax credit on the first $20,000 of 

qualified wages and health insurance costs paid to a tribal member 

or their spouse who live on or near a reservation. Both provisions 

have been renewed several times, but usually on an annual basis. 

Large capital investments are seldom made on the basis of shortterm planning. Without a fixed, long-term extension, businesses 

will be reluctant to factor the accelerated depreciation schedule or 

employment tax credits into their investment plans. The benefits of 

doing business on reservations needs to be seen by private enterprise as steady and predictable. In order to help encourage significant investment in Indian Country, businesses need to rely on 

long-term incentives. 

Although these are not high profile issues and are not commonly 

discussed solutions, ultimately economic development cannot occur 

unless the private sector is encouraged to do business in Indian 

Country. 

Mr. Chairman, Vice Chairman Barrasso, Members of the Committee, again thank you for this opportunity to discuss with you 

these important issues. 

[The prepared statement of Mr. Spoonhunter follows:] 

PREPARED STATEMENT OF HON. HARVEY SPOONHUNTER, CHAIRMAN, NORTHERN

ARAPAHO BUSINESS COUNCIL

Chairman Dorgan, Vice Chairman Barrasso, Members of the Committee. Thank 

you for the opportunity to share with you some information that will hopefully be 

helpful to you as you look for ways to assist Indian Country reduce the unemployment rate and help native people free themselves from the bonds of poverty and in 

some cases despair. I know that the time of the committee is limited and so my remarks will be brief but I hope helpful. 

Let me begin by providing some basic facts about the Wind River Reservation. 

The Wind River Reservation is located on 2.2 million acres in Central Wyoming. 

The unemployment rate on the Reservation exceeds 70 percent and over 60 percent of households live below the poverty line. 

With the opening of our three relatively small casinos, the marketing of our organic beef from our Arapaho Ranch to Colorado based food stores and our sponsorVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00064 Fmt 6633 Sfmt 6621 S:\DOCS\57830.TXT JACK PsN: JACKF
61 

ship of the tribally chartered Wind River Health Systems, a federally supported 

rural health system; we have begun to provide meaningful jobs outside of tribal government for our members. 

Obviously, there are many issues that are specific to the Wind River Reservation 

that I could discuss with you that would help my specific Tribe and Reservation. 

However, I would like to take my time with you this afternoon to discuss two important issues that affect all reservations throughout the country. 

The Northern Arapaho believes that two changes to the tax code would be most 

helpful in creating jobs in Indian Country. We would like to see an elimination of 

the ‘‘sunset’’ provisions in the property depreciation schedule and the Indian Employment Tax Credit. 

Specifically, Section 168(J) of the Internal Revenue Code has for many years provided an accelerated property depreciation schedule for certain property on Indian 

Reservations. The property tax provision allows businesses to depreciate that property twice as quickly as it could be depreciated outside a Reservation. 

Second, the Indian employment tax credit allows businesses to take a 20 percent 

employment tax credit on the first $20,000 of qualified wages and health insurance 

costs paid to a Tribal member or their spouse who live on or near a reservation. 

Both provisions have been renewed several times, but usually on an annual basis. 

Large capital investments are seldom made on the basis of short-term planning. 

Without a fixed long-term extension businesses will be reluctant to factor the accelerated depreciation schedule or employment tax credits into their investment plans. 

The benefits of doing business on Reservations needs to be seen by private enterprise as steady and predictable. In order to help encourage significant investment 

in Indian Country, businesses need to rely on long-term incentives. 

Although these are not high profile issues and are not commonly discussed solutions, ultimately economic development cannot occur unless the private sector is encouraged to do business in Indian Country. 

Mr. Chairman, Vice-Chairman Barrasso, Members of the Committee again thank 

you for this opportunity to discuss with you these important issues. 

The CHAIRMAN. Mr. Spoonhunter, thank you very much for your 

testimony. We appreciate your being here. 

We will next hear from Gloria O’Neill, President and CEO of 

Cook Inlet Tribal Council in Anchorage, Alaska. 

Senator Murkowski, would you like to say a word about your 

constituent? 

STATEMENT OF HON. LISA MURKOWSKI, 

U.S. SENATOR FROM ALASKA 

Senator MURKOWSKI. Thank you, Mr. Chairman. 

I am honored to welcome Gloria O’Neill to the Committee here 

this afternoon. Ms. O’Neill has been an outstanding leader, not 

only within our Alaska Native community in the Anchorage area, 

but throughout the State, and also at the national level working on 

the census issues, as so many. But she is an incredible advocate 

in so many different areas, and I am pleased and privileged to call 

her a friend as well. 

So it is good to be able to welcome her to the Committee. 

The CHAIRMAN. Ms. O’Neill, you have traveled a long way to be 

with us. You may proceed. 

STATEMENT OF GLORIA O’NEILL, PRESIDENT/CEO, COOK 

INLET TRIBAL COUNCIL 

Ms. O’NEILL. Thank you, Chairman Dorgan. 

And before I start, I have to tell you that as I was flying here, 

I came down with a case of laryngitis, so I ask you for your patience while I get through my testimony. 

Again, my name is Gloria O’Neill, and I serve as President and 

CEO of Cook Inlet Tribal Council, an Alaska Native tribal organiVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00065 Fmt 6633 Sfmt 6601 S:\DOCS\57830.TXT JACK PsN: JACKF
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zation that serves as the primary education and workforce development center for Native people in Anchorage. 

We accomplish our mission by connecting people to their potential through partnership. Our program serve Southcentral Alaska, 

with an Alaska Native and American Indian population of more 

than 42,000, or 40 percent of the Native population of the State. 

Anchorage is the fourth largest Native community in the Nation. 

CITC serves approximately 12,000 to 13,000 participants annually, administering over 85 grants and contracts funded by the Federal, State and private agencies. Our programs address many of 

the social, economic and educational challenges faced by Native 

people. 

Alaska Native students are twice as likely to drop out as their 

non-Native peers. The Alaska Native employment rate was only 54 

percent in the first half of 2009. A disproportionate number of Native families live in poverty and find it increasingly difficult to 

make a living in rural Alaska due to the high costs of energy and 

food. 

Without job opportunities, a large number are moving to Anchorage and other urban areas at an accelerated rate. Fifty-nine percent of CITC’s participants have been in Anchorage for less than 

five years. 

As we respond to many challenges and needs of our growing community population, CITC ensures wise community investment of 

government dollars. Our model is one of partnership, creativity and 

leverage. The most important tool we have in connecting Native 

people to their potential is our ability to utilize and leverage Public 

Law 102–477. Administered from DOI since 1992, 477 allows tribes 

and tribal organizations the ability to consolidate funding streams 

from various Federal agencies into a single employment and jobs 

training program. Public Law 477 has allowed CITC to transform 

employment and training programs from entitlement-based to an 

approach that fosters personal responsibility and leads to opportunity, choice and ultimately self-determination. 

In order for us to truly meet this mission of creating pipelines 

of people who are trained and ready for work, we start with our 

young people by making a significant investment in education. 

Over 1,000 kindergarten through 12th grade Native students are 

enrolled in CITC core content classes that range from basic 

English, math, science to advanced subjects such as calculus and 

chemistry. We know an educated workforce is key to promoting 

economic prosperity. 

The results? We place 1,200 to 1,500 in unsubsidized jobs each 

year in industries across the State. This equates to a conservative 

estimate of placing 13,000 Native people in jobs over the past decade. Of these, 1,800 families moved from welfare to work in the 

last three years. 

CITC has also been able to successfully utilize 477 funding to 

create job opportunities through social enterprise. The benefit of 

these operations is twofold: allowing us to create businesses that 

are supported by earned income, while providing a longer term opportunity for participants to develop good job skills. 

Through the leverage of funding and social enterprise, we have 

created approximately 75 community jobs on an annual basis. The 

63 

value of this law is that it requires a high level of accountability, 

while allowing tribal organizations to plan according to community 

needs, minimize administrative duplication, and maximize outcomes, while still adhering to high GPRA accountability standards. 

As a result, nationally, the 477 Program achieved the highest 

OMB PART rating in Indian Affairs. Unfortunately, HHS is seeking to terminate participation and the transfer of funds within 477 

without tribal consultation. In addition, OMB recently released 

2009 mid-year audit compliance guidelines that require tribes and 

tribal organizations to track each funding stream under 477 separately and retroactively. This contradicts the intent of the 477 language and effectively undermines the administrative efficiency and 

flexibility of the program. 

In summary, on behalf of CITC and the 264 tribes who participate in 477 and the communities we serve, whose needs grow more 

critical each day due to the current economy, I urge this Committee 

to consider, one, a no cost item that should be placed in the proposed jobs bill; amended 477 legislation and/or a legislative rider 

that, one, establishes the program as permanent; two, ensures full 

flexibility that allows efficiency, while maintaining high accountability standards; and three, utilizes funding vehicles such as 638 

contracts and self-government compacts. 

As a result of the demonstrated success over the past 18 years, 

I ask you for your support of the 477 Program. It is in the best interest of tribes, tribal organizations, Native people and taxpayers. 

Thank you. 

[The prepared statement of Ms. O’Neill follows:] 

PREPARED STATEMENT OF GLORIA O’NEILL, PRESIDENT/CEO, COOK INLET TRIBAL

COUNCIL

Chairman Dorgan and Members of the Committee, I am grateful for the opportunity to speak before you today. 

My name is Gloria O’Neill and I am the President and CEO of Cook Inlet Tribal 

Council (CITC), an Alaska Native tribal organization which serves as the primary 

education and workforce development center for Native people in Anchorage. CITC 

has been designated tribal authority through Cook Inlet Region Inc., organized 

through the Alaska Native Claims Settlement Act and recognized under Section 4(b) 

of the Indian Self-Determination Act and Education Assistance Act, P.L. 93–638. 

CITC builds human capacity by partnering with individuals to establish and achieve 

both educational and employment goals that result in lasting, positive change for 

themselves, their families, and their communities. 

Demographics and Expanding Service Population 

Both directly and indirectly, CITC’s programs serve the Cook Inlet Region with 

an Alaska Native/American Indian population of more than 42,000, which is approximately 40 percent of the Native population of the state of Alaska; some programs reach statewide. In Anchorage alone, the Native population is approximately 

30,000 about 20 percent of the total Native population in the state. Anchorage is 

the fourth largest Native community in the nation. 

CITC’s FY10 operating budget is $43 million, consisting of 85 grants and contracts from state and federal agencies, as well as corporate and individual support. 

CITC’s programs address many of the social, economic, and educational challenges 

faced by Alaska Native people. For example, Alaska Native students are twice as 

likely to drop out as their non-Native peers; 33 percent of Alaska’s unemployed are 

Alaska Native people, and almost 20 percent of Alaska Native people have incomes 

below the federal poverty line—nearly three times the rate of non-Native people. 

As reflected in the chart below, in-migration is accelerating as Alaska Native people find it increasingly difficult to make a living in rural Alaska. Fifty-nine percent 

of CITC’s participants have been in Anchorage for five years or less; and employment, training, and education are frequently cited as reasons for moving to AnchorVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00067 Fmt 6633 Sfmt 6621 S:\DOCS\57830.TXT JACK PsN: JACKF
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age. In contrast, the current Bureau of Indian Affairs funding formula for CITC is 

based on the population figure of 14,569—from the 1990 Census—which leaves 

CITC deficient in funding the needs of the 42,000 Alaska Natives and American Indians currently residing in our service region. 

Program Opportunities 

With the support of Bureau of Indian Education Johnson-O’Malley funding, 

CITC’s educational programs provide strength-based, culturally-focused educational 

support services in partnership with the Anchorage School District. CITC currently 

serves approximately 1,000 K–12 Native students and their families. Our programs 

encompass K–12 classrooms, focusing on increasing literacy and math skills as well 

as offering supplemental programs in high-level mathematics and science classes, 

and health and wellness. Our purpose is to impact overall academic achievement 

while decreasing the dropout rate of Native students, both of which are essential 

to job development and success. Given the projected increase in the Alaska Native 

population over the next years and the extent to which Alaska Native people will 

be the backbone of the state’s workforce, an educated workforce is key to promoting 

economic prosperity. 

With the support of the P.L. 102–477 program, CITC’s employment and training 

programs are based on the premise that effective solutions to workforce development 

require integrated approaches to ensuring job readiness, training, and placement— 

approaches that are capable of moving people from welfare to work. Programs involve active cooperation between schools, social service agencies, job trainers, state 

and federal agencies, Native and non-Native for-profit employers, and CITC-owned 

microenterprises—all of which build ladders of opportunity for our participants. 

Since the inception of CITC’s Tribal TANF Program in July 2005, 1,800 TANF participants have transitioned to unsubsidized employment. 

CITC has been able to successfully utilize 477 funding to create job opportunities 

through social enterprise. The benefit of these operations is two fold: allowing CITC 

to create businesses that are supported by earned income while providing a longerterm opportunity for participants to develop good job skills. Through the leverage 

of funding and social enterprise, CITC has created approximately 75 community jobs 

on annual basis. 

In close collaboration with our workforce development program, CITC is the sole 

provider of Temporary Assistance for Needy Families (TANF) and Bureau of Indian 

Affairs Welfare Assistance for Alaska Native/American Indian families in Anchorage. CITC has transformed TANF and welfare assistance from entitlement-based 

programs to programs of self-determination and personal responsibility. In CITC’s 

TANF and welfare assistance programs, participants develop a mutual plan of action with their case manager that outlines their responsibilities: to get a job and 


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to participate in various training and support services to achieve that goal. As a result, the number of families dependent upon TANF and welfare assistance has decreased, with families making major strides toward self-sufficiency. 

Accountability 

Program opportunities, such as Tribal TANF, require rigorous standards that are 

reflected in our organizational commitment to accountability. We have a mandate 

from the people we serve, from CITC’s Board of Directors, from the federal and state 

sponsors of our services, and from our community as a whole, to provide the highest 

quality services possible. This is demonstrated by our history of stellar audits and 

a commitment to quality that can only be realized by rigorously and continually reassessing how we do business to determine how we may do better. CITC utilizes 

Continuous Quality Improvement (CQI) to enhance and improve the quality of 

CITC’s services by gathering and analyzing an extensive set of statistics on program 

performance, as well as identifying areas for improvement. The resulting data is 

tracked through digital dashboards that provide powerful, at-a-glance overviews of 

program performance; highlighting areas needing improvement. 

FY 2009 Cook Inlet Tribal Council Employment & Training Dashboard 

• CITC consistently beats TANF goals by combining outcome-directed case management with a career center that links employers to work-ready employees. 

• Job seeker numbers exceeded targets that were based on the prior year. Rising 

unemployment and urban migration were both significant contributing factors 

in fiscal year 2009. 

• The need for supportive services was markedly higher than the prior year. 

Public Law 102–477 

Administered from the Office of Indian Energy and Economic Development, located in the Department of the Interior, Public Law 102–477 (or the ‘‘477 program’’) 

provides a critical foundation for maximizing the effectiveness of CITC’s programs. 

The law allows the consolidation of funding streams from Department of Interior, 

Department of Health and Human Services, and Department of Labor, into a single 

employment and training program. The 477 program enables flexibility on the part 

of the receiving organization to plan the programming to best fit the needs of the 

community and minimize administrative redundancy by merging reporting requireVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00069 Fmt 6633 Sfmt 6621 S:\DOCS\57830.TXT JACK PsN: JACKF

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ments, while still adhering to the Government Performance Results Act’s stringent 

accountability standards. 

CITC has demonstrated that the 477 program is very successful in allowing the 

leverage of funding to increase effectiveness and innovation. As a result of our 477 

program, for example, we have been able to put between 1,000 and 1,500 people to 

work each year and effectively reinvest TANF savings into related essential programs. In short, the 477 program is a ‘‘win-win’’ for the federal funders and CITC, 

since it eliminates wasteful inefficiency while maximizing program outcomes. 477 

has succeeded in, and has even greater potential to allow tribes and tribal organizations to achieve economic prosperity for their people. In addition to being successful 

on the ground, the 477 program is fully accountable. Reflective of the national success of the program, the 477 program achieved the highest Office of Management 

and Budget PART (Program Assessment Rating Tool) rating in Indian Affairs. 

However, the Department of Health and Human Services stopped transferring 

funding through the Department of Interior and P.L. 93–638. There has been no 

tribal consultation regarding this change in policy. The interruption of funding resulting from DHHS’s decision to discontinue the transfer of funds puts our community and others at risk. Not only is this potential funding interruption injurious to 

our organization, and particularly to the people we serve, it is not in the best interests of taxpayers who have a right to expect the administrative efficiencies that the 

477 program achieves. 

In addition, the Office of Management and Budget released 2009 mid-year A–133 

Circular compliance guidance that requires tribes and tribal organizations to track 

each funding stream under 477 separately and retroactively. This contradicts the intent of the 477 legislation and effectively dismantles the administrative efficiency 

and flexibility of the 477 program. 

Specific Requests 

On behalf of Cook Inlet Tribal Council and the community we serve—whose needs 

grow more critical each day due to the current economy—I urge this Committee to 

consider the amended 477 legislation and legislative rider. This legislation is in the 

best interest of tribal programs and participants, as well as taxpayers. It is imperative to maintain the high level of efficiency, effectiveness, and accountability that 

has been the hallmark of the 477 program. I would also ask the Committee to fully 

support the aforementioned Department of Interior Indian Affairs programs that are 

vital to our participants’ success. 

Thank you for your time and consideration. 

The CHAIRMAN. Ms. O’Neill, thank you very much. Your voice 

held up just fine. 

Ms. O’NEILL. It was tough. 

The CHAIRMAN. All right. You did fine. 

Mr. Conrad Edwards, President and CEO, Council for Tribal Employment Rights at Federal Way, Washington. 

Mr. Edwards, thank you for being with us. You may proceed. 

STATEMENT OF CONRAD EDWARDS, PRESIDENT/CEO, 

COUNCIL FOR TRIBAL EMPLOYMENT RIGHTS 

Mr. EDWARDS. Mr. Chairman, Honorable Members of the Committee, my name is Conrad Edwards. I am a member of the 

Colville Confederated Tribes of Washington State. 

I am known to my people as Hoolia, which translates roughly to 

Earth Runner. I am the President of the Council for Tribal Employment Rights and Chairman of the Advisory Board of the newly 

chartered Native Construction Careers Institute. 

On behalf of the CTER Board of Directors and our construction 

trades union partners in the NCCI, I would like to thank you for 

holding this hearing today and inviting our testimony. We feel it 

presents a tremendous opportunity to address the unacceptably 

high unemployment rates that we have been talking about here 

today, and the deplorable social and economic conditions that it 

puts our Indian people in and we continue to endure. 

67 

Today, Indians and Native Alaskans are developing and are in 

control of more of our economic destiny than at any time in our history. We are becoming major contributors to the local, State, regional, national and international economies. We have strong tribal 

governments and growing tribal enterprises and industries, and yet 

our tribal workforce is still largely unemployed. 

We feel this is due to the focus on business and governance, and 

not inclusive of labor, which is the final element of any successful 

social and economic development equation. The facts are that our 

average tribal workforce is 50 percent to 70 percent non-Indian and 

our unemployment rates are still 50 percent to 80 percent, depending on what reservation you are on and what time of the year it 

is. 

In the midst of all of our economic strides, Indian employment 

is still just an after thought. Knowing what we know from our field 

of experience, we have chosen to approach the problem head on, 

utilizing Indian preference and tribal employment rights enforced 

at the tribal level. 

The Tribal Employment Rights offices have done a very effective 

job of capturing public sector jobs and gaining compliance for many 

reservation employers while they are working in the community. 

Our experience shows us the problem is still much broader than 

that, requiring new initiatives, taking our tribal strategy to the 

next level of development. 

Our expanded approach is detailed in our written testimony. Suffice to say here that we chose what is still the largest industry in 

Indian Country today, construction, as our arena. With $430 billion 

plus in vertical and horizontal construction scheduled to occur on 

or within 10 miles of an Indian reservation over the next 10 years, 

it presents plenty of opportunity. 

With organized labor seeking to replace tens of thousands of retiring Baby Boomers and having the capacity to train and field 

qualified workers in a cost-efficient manner, they make a viable 

partner. 

Our approach involves several key elements that when brought 

together have proven effective and cost-efficient, and at the same 

time are responsive and responsible to the tribes’ project needs, 

values and priorities. The first element is tribal project labor agreements. It is an agreement between organized labor and the tribe. 

It can be project-specific or reservation-wide. It covers tribal sovereignty, tribal sovereign jurisdiction, wages, benefits, Indian preference, training, no strike, no lockout, dispute resolution, after 

project placement. And it was piloted at the Tulalip Indian Tribe 

when we built a $170 million casino on an 18-month schedule. 

Mr. Chairman, on that project, there were 2 million hours 

worked, and 70 percent of those hours were worked by Native employees, contractor, or subcontractors. The project finished on 

schedule, on budget, and there were no disputes that either went 

to court or left the project. Now, the tribal labor agreement applies 

reservation-wide and Tulalip. 

We now use that same model to develop these tribal project labor 

agreements in Minnesota, Wisconsin, New York, Alaska, Washington, Canada, Wyoming. And we include all crafts, all of the conVerDate Nov 24 2008 13:05 Aug 24, 2010 Jkt 057830 PO 00000 Frm 00071 Fmt 6633 Sfmt 6601 S:\DOCS\57830.TXT JACK PsN: JACKF
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struction trades. Again, I will refer you to the details in our written 

testimony. 

The second element is Native Construction Trades Institute. It 

provides career-focused training onsite on tribal projects at game 

speed. We are doing actual construction projects and we are building actual buildings and facilities. And it is not practice. It is not 

pre-apprentice. It is actual construction work. 

Union training curriculum for 100, 200, 300 hours by certified 

trainers, and it includes a 100 hour entrepreneurial element to create subcontractors and contractors at the same time we are training crafts people and develop small businesses. It has been piloted 

on the Blackfeet, Spirit Lake, Cheyenne River, and Wind River 

Reservations. 

Thus far, we have trained 66 individuals. Fifty-nine of them have 

graduated and we have placed 89 percent of those graduates into 

actual projects and jobs. In the process, we have developed seven 

new small businesses on those reservations. 

The tribes provide the materials, recruitment, support services. 

CTER provides onsite coordination with the project’s budget and 

schedule, and with the Interior Energy and Economic Development 

Administration providing administration and technical assistance. 

The third element is entrepreneurship. Seventy percent of all 

jobs in America are created by small businesses. Our strategy is to 

create small businesses to address the unemployment problem. We 

encourage the Committee to consider it in the construction of the 

jobs bill. And as Chairman of the NCCI, we are requesting the following. We are requesting that $1 million be provided to NCCI construc- tion training to 10 more tribes. We are requesting that $600,000 

for pilot projects to expand the NCCI approach into other areas 

such as forestry and health jobs. We are requesting $500,000 to enable NCCI to establish a Center for Indian Jobs Creation. We are 

requesting $75 million be put in there for green job training 

projects through Indian Pathways Out of Poverty, a Labor grant 

program. 

Small business development, $5 million to SBA for innovative Indian small business pilot projects on reservations in such areas as 

grass-fed beef, information technology, oil/gas development, small 

business development in connection with large development 

projects on and near the reservations; $5 million to SBA for Tribal 

Business Assistance Centers. This is to provide small business 

training and technical assistance to all levels of small business development, not just the cream of the crop. 

Increase the BIA Loan Guaranty Program ceiling to $300 million; 

funding to the Department of Commerce, to establish an Indian 

Surety Bond Guaranty Program and to develop infrastructure, including specifically identified funding for Indian tribes on all infrastructure portions of the larger jobs bill. 

In conclusion, this bill comes at a critical time when Indian 

tribes are transitioning between grants-driven economies to diverse 

capital economies. As a part of that transition, and adding the final 

element, is creating a tribal private sector. And that tribal private 

sector consisting of Indian small businesses is critical. It is the 

final element to that transition. 

69 

And finally, Mr. Chairman, Members of the Committee, I express 

our appreciation to you and Congressman Dicks for your presentations at the NCCI launch last September because it was one of 

the highlights of our launch. And we thank you also for your leadership in addressing this critical issue. And we thank you for the 

opportunity to provide our perspective today in this testimony, and 

I have done so for all our relations. 

Thank you. 

[The prepared statement of Mr. Edwards follows:] 

PREPARED STATEMENT OF CONRAD EDWARDS, PRESIDENT/CEO, COUNCIL FOR TRIBAL

EMPLOYMENT RIGHTS


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The CHAIRMAN. Mr. Edwards, thank you very much. We appreciate it. 

Mr. Laverdure, thank you for being patient. I know it was probably helpful also for you to hear the testimony from others. 

My understanding is that you are re-working a report on the 

issue of unemployment on Indian reservations. It has been some 

while since a report has been issued, and you are scheduled to release the new report this summer. 

Do you expect, based on what you know, to see any substantial 

difference between this report and its conclusions, and unemployment results from previous reports on Indian reservations? 

Mr. LAVERDURE. Thank you, Mr. Chairman. 

The report that is supposed to come out, which I know is to be 

every year or every other year. I recall in 2005 being referenced in 

this hearing on a couple of occasions. The labor force report that 

we are putting together is going to be more accurate because prior 

to that, it was either whether you were employed or unemployed. 

And so it could have exaggerated who was employed at any given 

time and erred perhaps on the side of favoring unemployment. 

The other factors are going to be seasonal and temporary workers, and those will be factored in. So I think it will give a more 

complete and accurate picture this time around of oftentimes 

whether it is forest fighting season, summer contract worker or the 

like, and I think that more information is better to provide on exactly what types of jobs are there and how temporary they are. 

The CHAIRMAN. Let me ask you very quickly, the issue of trying 

to develop incentives for renewable energy production. I am talking 

about renewable energy on Indian reservations because reservations have great capability to provide additional energy from fossil 

energy, oil, coal and so on. But are you focusing some as well on, 

or are there programs focusing on development of additional renewable energy? 

Mr. LAVERDURE. I would love to discuss parts of the budget, but 

I am not allowed to until next week’s rollout. Secretary Salazar on 

Monday is going to have a press conference and the Indian Affairs 

budget will be in there as well. But I think Secretary Salazar himself has said that he has supported increased funding for climate 


128d18.eps
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change and renewable energy, and the Assistant Secretary’s Office 

has had a seat at the table for all of those to try to join that initiative, such as the MOU they have in California to fast track various 

renewable projects. We are pushing to have comparable things happen in Indian Country. 

Our biggest challenge is going to be access to the grid on the 

transmission because it is such a large infrastructure piece to be 

part of the energy corridors. So we are looking to be part of all of 

that renewable energy initiative and have fast track projects. We 

have identified 10 that we think could be fast tracked over the near 

term, and 66 total. 

The CHAIRMAN. Thank you very much. 

I am going to truncate my questions and submit questions in 

writing to the witnesses because the vote has started, and I want 

to make sure Senator Franken and Senator Murkowski have opportunities to ask questions. 

Senator Franken first. 

STATEMENT OF HON. AL FRANKEN, 

U.S. SENATOR FROM MINNESOTA 

Senator FRANKEN. Thank you, Mr. Chairman. 

I am going to go back to something I brought up earlier for Mr. 

Laverdure. 

There are a couple of tribes in Minnesota, Red Lake and White 

Earth, that have been waiting for years to build schools that they 

thought had been commissioned. And they were on some list that 

they can’t get hold of, that no one can get hold of on where they 

are in order on school construction. And there just seems to be a 

lack of transparency in the Bureau of Indian Affairs on that. 

Can you tell me something about it? 

Mr. LAVERDURE. Thank you, Senator Franken, for the question. 

I recall from the Federal acknowledgment hearing you brought that 

issue up and have now pressed it even further. I did talk to the 

Program Director of the Office of Facilities Construction and asked 

him if he had submitted it, and he said he had submitted a list to 

your office two weeks ago, but it may not have been complete. It 

may not have had all of the rankings within that list. 

The thing that I learned through the Director of the office was 

that it said on the No Child Left Behind rulemaking from 2003, 

2004, there is a set of factors that are followed. And with those factors, which are largely based on a set formula for type of school 

and the amount that construction costs would be, the size of the 

rooms, a certain standard, that as the conditions of schools over 

time deteriorate, then some of those schools either move up or 

down that list. 

And so he said when you send it out, it is like a financial statement where it is a snapshot, and then it changes depending on the 

schools that are in worse condition and they rise to the top. But 

I certainly will sit down and talk to him about that. 

Senator FRANKEN. One of the schools that I am talking about 

that needs to be replaced at Leech Lake has like waterfalls in it 

because of the plumbing doesn’t work. I mean it is, believe me, it 

would rise to the top of the list. And I asked my staff here if they 

88 

recall getting this list, and they don’t recall getting it. So we will 

follow up with that, okay? Okay. 

Mr. Edwards, I just want to talk about a potential alternative energy, green energy development on reservations, which seems—in 

Minnesota, we have a lot of wind. But one of the reasons is just 

a lack of private investment that we don’t have the kind of projects 

we need. 

For example, the Mille Lacs Lake Indian Reservation in Minnesota has been trying for the past year to access funding for a single wind turbine. They initially got low interest financing through 

a clean renewable energy bond, but in December the bond house 

hiked up the interest or said they would have to lift the interest 

so they can’t actually sell the bond. 

I would like to ask you about the Indian Guaranty Loan Program 

under the Office of Indian Energy and Economic Development. I 

understand that the loan program guarantees and insures loans. Is 

that right? 

Mr. EDWARDS. Yes. 

Senator FRANKEN. And that is supposed to reduce the risk to private investors to invest in Indian businesses. This program received $8.2 million in fiscal year 2010, is that correct? Did I hear 

that, Mr. Laverdure? 

Mr. EDWARDS. I believe so. 

Senator FRANKEN. Is that right? What does that allow tribes to do, $8.2 million for all of Indian Country? 

Mr. EDWARDS. Not very much. I think that these loan guaranty 

programs I think are a critical element, but at this point are very 

much under-funded. And I think that the accessibility of them is 

something that is critical to small businesses to be able to act and 

to move quickly and nimbly in the process of developing small businesses. 

So I think that that is an area that we would be happy to work 

conjunctively with Interior Department and the other partners at 

this table to make that process more efficient, more cost-effective. 

Senator FRANKEN. Well, I hope we can do more. When you are 

having 50 percent nationwide unemployment in Indian Country, 

you almost don’t know where to start, on education, on training, on 

credit, on and on. 

So thank you all for being here today. 

The CHAIRMAN. Senator Franken, thank you very much. 

Senator FRANKEN. I have run out of time. Thank you. 

The CHAIRMAN. Senator Murkowski? 

Senator MURKOWSKI. Thank you, Mr. Chairman. 

Ms. O’Neill, thank you for outlining some of the challenges that 

we face in providing those employment opportunities for Alaska 

Natives, and the recognition that Anchorage’s role as the center, 

the home for so many is just growing by leaps and bounds. 

We have had an opportunity to talk about the new OMB audit 

requirements for the 477 Program, and really how that dismantles 

this whole program and what the consequences are. We had a 

chance to talk about that these past couple of days. 

Can you, for purposes of the Committee record here, just lay out 

what will happen if tribes are unable to comply with these new 

OMB requirements? I understand that, for instance with CITC, you 

89 

are probably able to go back and retroactively deal with this, but 

that in fact we will have some of our tribes that are unable to meet 

these requirements. And if you can just outline the consequences, 

please. 

Ms. O’NEILL. Well, most tribes and tribal organizations are preparing to engage in their 2009 audits. We are just finishing our 

field work. It cost us about I would say $20,000 in extra audit 

costs, along with staff time, so it is probably $20,000 to $30,000. 

And we had to take many, many hours and resources to go back 

and realign the funding sources. 

What the OMB circular says is that they would like us to categorize all of our funding sources by CFDA numbers. So that 

means if you have a 477 contract or compact, you could be pulling 

in three to four, in our case 11 different funding sources. The beauty of 477 is that we stay within the broad parameters of the law 

where it relates to service dollars. With the administrative costs 

that are associated with providing those services, we are able to 

commingle the funds in a very effective and efficient manner. 

And I had an opportunity to meet with OMB this morning, along 

with staff from Department of Interior. We did not have staff from 

HHS at the meeting. There was agreement reached that we will 

work in partnership to try to resolve this issue for 2009, and we 

look forward to what kind of solution we can bring for 2010. 

But it is an issue. We do not want tribes and tribal organizations 

to get into this and realize as they are in their audit that the circular applies to them in this last fiscal year 

and to have an audit finding as a result. It is very detrimental 

to our programs and to the standards that we are trying to adhere 

to. 

Senator MURKOWSKI. And we know those audit findings can be 

fiscally damaging to the tribes. 

Mr. Laverdure, just in so far as what the plans of Interior and 

HHS are as you move forward to resolve these interagency disputes 

here, what is on the table? 

Mr. LAVERDURE. Thank you, Senator Murkowski. 

Actually, Bob Middleton, the Director of IEED, who has the 477 

program, and I, are the agency lead. We met with HHS folks yesterday, in fact, and went over this issue. There are several different 

components to zeroing in on the OMB side, but there is also the 

Navajo Nation case that came up on 638 contracting issues. And 

we have talked to HHS and have relayed all the tribal concerns 

and will continue to relay the tribal concerns on having Interior as 

the lead and having these 638 and self-governance vehicles still be 

useful to try to access those TANF funds and minimize the reporting requirements. 

So that has been our position. We are trying to work with HHS 

on the issue for an agreement. 

Senator MURKOWSKI. Let me ask you, do you believe that HHS 

agrees and sees the merit in the efficiencies that we have gained 

through these 477s? 

Mr. LAVERDURE. I think that they have. I think it is more a legal 

issue from the legal side of things, with the Office of General Counsel interpretation of the case and how far it goes. 

90 

Senator MURKOWSKI. Isn’t it true, though, that the interpretation 

that has been out there has been in place for some 16, 17 years 

and now all of a sudden we are seeing a reinterpretation? I don’t 

know if that is the right word. 

Mr. LAVERDURE. Yes. Well, I will continue to foster good relations with HHS and say that we will work with them and try to 

do our best to resolve the issues so that the tribal communities can 

continue the way they have been. 

Senator MURKOWSKI. Well, I appreciate that. I know that people 

like Ms. O’Neill and so many around the Country are anxious to 

have this resolved favorably and to be able to continue to utilize 

these efficiencies. 

We recognize that the dollars are scarce and when we pull it all 

together, we are going to get more bang for our buck. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Senator Murkowski, I am told that there is no 

time left on the clock for this vote, so you and I will have to be 

speedy. 

I think this requires a much longer discussion, and I apologize 

for having to truncate it. I don’t want to call a recess for 45 minutes. So what I think we will do is engage with all of you through 

submitted written questions to complete the hearing record, and for 

two weeks we will accept additional comments from those who wish 

to submit comments to this hearing. 

We thank you very much for your testimony. This Committee 

will take this issue very seriously. 

This hearing is now adjourned. 

[Whereupon, at 3:40 p.m., the Committee was adjourned.] 

(91) 

A P P E N D I X 

PREPARED STATEMENT OF BARRY E. SNYDER, SR., PRESIDENT, SENECA NATION OF

INDIANS

Introduction 

Mr. Chairman and members of the Committee, I submit this written testimony 

on behalf of the Seneca Nation of Indians and ask that it be included in the record 

of this hearing. 

I want to commend the Senate Indian Affairs Committee for holding this vitally 

important hearing on unemployment in Indian Country. Now more than ever, preserving jobs is a top priority. With the national unemployment rate at 10 percent, 

the unemployment rate in Indian Country has climbed to 50 percent or higher. On 

many reservations and territories there is declining hope of meaningful job creation. 

For generations it has been the policy and practice of the Seneca Nation leadership and government to encourage a robust private sector economy. The Seneca Nation has created a tax-free economy on our Territories which, like an enterprise 

zone, fosters local growth where it would not otherwise take place and where it is 

vitally needed. As a result, there is a vibrant entrepreneurial private sector economy 

in the Seneca Territories. 

Unfortunately, all of this progress is at risk due to the Prevent All Cigarette Trafficking Act, S. 1147 (‘‘PACT Act’’) which recently was favorably reported by the Senate Judiciary Committee. Known to many as the ‘‘Marlboro Monopoly Act of 2009’’, 

this bill would eliminate the vibrant private sector economy of the Seneca Nation. 

The irony of your important hearing taking place at the same time the Judiciary 

Committee leadership is seeking to put a bill on the floor that will kill many jobs 

in Indian Country should not be lost on the members of the Senate Indian Affairs 

Committee. 

The Proposed PACT (‘‘Prevent All Cigarette Trafficking’’) Act Threatens to 

Violate Seneca Treaty Law 

The U.S. House of Representatives has twice passed a form of the PACT Act. And 

a version, S. 1147, is pending action on the U.S. Senate calendar, having been reported by the Committee on the Judiciary on November 19, 2009. 

The PACT Act would break new ground in Federal Indian law by vesting State 

governments with far-reaching Federal authority over economic activity on Indian 

lands. It would apply and enforce excise taxes of State and local governments on 

sales conducted on or from Indian Country. The bill would empower State Attorneys 

General to reach into Indian Country to sue individuals to enforce Federal and state 

law. Collectively, these new Federal law provisions likely will operate to induce 

State governments to abandon long-standing Tribe-State compacts and tax agreements, bringing to a halt what has become for some Tribal governments a substantial revenue stream. In breadth and scope, the PACT Act is to State tax power over 

all of Indian Country what Public Law 83–280 was to State criminal jurisdiction 

over some parts of Indian Country. 

The PACT Act would make cigarettes non-mailable except within or to Alaska and 

Hawaii, effectively banning Internet sales being made from Indian Country by making it impossible to deliver the product. 

Given the history of state-tribal tax compact negotiations, if enacted the PACT 

Act provisions will empower states to use their new Jenkins Act enforcement authority to forcibly re-negotiate changes to tax and enforcement Tribe-State Compacts 

or agreements throughout Indian Country and to continue to refuse to share Master 

Settlement Agreement payment and in lieu revenues with Tribes. The PACT Act 

will operate to induce State governments to abandon long-standing Tribe-State 

Compacts and tax agreements, bringing to a halt what has become for some Tribal 

governments a substantial revenue stream. 

92 

1 In 2005, the State of New York estimated that retailers on Seneca Nation Territories sold 

27.5 million cartons of cigarettes. From March 2007 through February 2008, the Seneca ImportExport Commission recorded sales of 17.3 million cartons as average prices declined. 

The PACT Act Would Swiftly Suffocate the Unique Economy of the Seneca 

Territories and Throw Our Region Into a Deep Depression 

The Seneca Nation stands apart from the rest of Indian Country with a superlative private sector that dominates the commercial economy of the Seneca Reservations. About 240 private businesses, owned and operated by Seneca citizens, function on the Seneca Territories. Given that there were 1,176 Indian households on 

the three Seneca Nation Territories recorded in the 2000 Census, it is clear that 

most of the Indian households are receiving direct employment benefit from the 

Seneca private sector. This private sector Seneca economy provides income and investment capital typically not seen elsewhere in Indian Country, with Seneca entrepreneurs typically owning hotels, stores, franchises, and other small businesses that 

elsewhere are typically tribally owned or not Indian-owned at all. A study in 2007 by Harvard University economist Jonathan Taylor found that $68 

million in value-added (regional gross domestic product) in Western New York is associated with Seneca tobacco sales and $71 million state-wide. When gasoline and 

other non-tobacco sales are added, this number soars, with secondary sales generating more than $10 million in sales and excise taxes in neighboring jurisdictions 

as Seneca private sector demand for goods and services in the broader economy is 

taxed by New York State. 

If the PACT Act were enacted, it would completely disrupt the tobacco product 

market on Seneca Nation Territories by removing the tax immunity guaranteed 

under the Seneca Nation’s treaties with the United States. And it would completely 

shut down the Internet cigarette market that operates from Seneca Nation Territory. 

The impact on the Seneca Nation economy would be devastating if the PACT Act 

were enacted into law. Likewise, the PACT Act would throw the entire economy in 

western New York into a tailspin. Thousands of jobs would be lost within 90 days 

of enactment. Hundreds of households would be thrown on to the unemployment 

and welfare lines. 

The Senate Should Reject the PACT Act as a Job-Killer in the Middle of a 

Recession 

The Seneca private sector economy arises from two primary sources: the Seneca 

Nation’s sovereign exercise of authority over regulatory and tax policy that applies 

on the Seneca Territories; and the Seneca Nation’s choice to have a tax-free and 

lightly regulated economy. Under the guise of protecting children from the dangers 

of smoking, the PACT Act would impose State taxing authority on treaty-protected 

Seneca Territory. 

It is cruelly ironic that at the height of a recession the United States Senate is 

considering both a jobs creation bill and a job-killing bill. This Committee on Indian 

Affairs must not stand by idly while consideration of the PACT Act threatens to destroy tribal economies. It is even more ironic that this comes at a time when increased Seneca Nation regulation and lessening market demand is having the effect 

of shrinking tobacco sales.1

The Seneca Nation of Indians calls upon this Committee on Indian Affairs to actively exercise its function to protect Federal-Indian law and its foundation in Federal Treaties such as our Treaty of Canandaigua of 1794, 7 Stat. 44. 

The Seneca Nation of Indians (‘‘Nation’’) is recognized by the United States and 

the State of New York as a sovereign tribal government. The Nation is a signatory 

to numerous treaties and agreements with the United States which govern the relations between the Nation, the United States, and the State of New York, including 

matters regarding commerce and taxation. These treaties and agreements have 

their origins in deals under which vast land holdings were transferred out of Seneca 

Nation control in exchange for specific security and protection guarantees by the 

United States for the remaining Nation lands. 

The Seneca Nation’s Territories Are Immune From State Taxation 

The Seneca Nation, our people and our lands, have been immune from State taxation since the United States was formed. Agreement after agreement has reiterated 

this tax immunity and the inherent, sovereign right of the Seneca Nation to regulate conduct within our Territories. This tax immunity is most notably protected by 

the United States through the Treaty of Canandaigua of 1794, 7 Stat. 44. 

All legislation under consideration by the U.S. Congress, whether its purpose is 

to create jobs or to regulate the economy, must honor the tax immune integrity of 

93 

our Territory. The 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 regulate conduct within our Territories— 

should be supported, not undermined by the U.S. Congress in every piece of legislation it writes. 

The Seneca Nation Regulates Its Own Tax-Free Economy as an Expression 

of Its Tribal Sovereignty 

In the exercise of its sovereignty over its Territories, the Seneca Nation enforces 

a comprehensive Import-Export Law it enacted in 2006 to regulate sales of tobacco 

and other products on its Territories. The Nation’s Import-Export Commission regulates all aspects of tobacco and other product sales on Seneca Nation Territory. 

Among other functions, the Commission: 

• Prevents the importation of tobacco products into Nation Territories only by licensed stamping agents; 

• 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. 

Conclusion 

The rapidly growing Seneca Nation economy provides substantial benefits to the 

Western New York regional and State economy. In 2007, the Seneca Nation directly 

employed more than 6,300 workers in government and enterprise, giving them 

$191.3 million in compensation. The Nation’s government, enterprises, and private 

sector brought in $1.1 billion in revenue in 2007, generating indirect and induced 

demand totaling an estimated additional $820 million and yielding an estimated $6 

million in state and local taxes, over and above the $109.7 million exclusivity payment the Seneca Nation provided to the State of New York under its Gaming Compact. The Seneca Nation’s tax-immune economy provides livelihoods for hundreds of 

Seneca households and the many businesses in the surrounding private sector of 

Western New York that meet their needs. 

We ask that this Committee gather accurate, relevant, and reliable information 

regarding the Seneca Nation’s regulation of tobacco sales taking place in our Territories. Our market competitors have fed great distortions to the U.S. Congress 

which need to be corrected before they are relied upon to make federal policy. 

The Seneca Nation also asks that this Committee ensure that the United States 

Congress honor our treaties and protect our inherent, sovereign right to regulate 

conduct on our Territories, including our immunity from State taxation. Otherwise, 

there will be many more jobs to create than can ever possibly be created. Thank 

you for this opportunity to provide testimony and we ask that it be made part of 

the record of this hearing. 

94 

PREPARED STATEMENT OF DIMITRI PHILEMONOF, PRESIDENT/CEO, ALEUTIAN

PRIBILOF ISLANDS ASSOCIATION


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PREPARED STATEMENT OF HON. E.T. ‘‘BUD’’ MORAN, TRIBAL COUNCIL CHAIRMAN, 

CONFEDERATED SALISH AND KOOTENAI TRIBES


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PREPARED STATEMENT OF HON. A.T. RUSTY STAFNE, CHAIRMAN, ASSINIBOINE AND

SIOUX TRIBES, FORT PECK INDIAN RESERVATION


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PREPARED STATEMENT OF KATHERINE GOTTLIEB, MBA, PRESIDENT/CEO, 

SOUTHCENTRAL FOUNDATION


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PREPARED STATEMENT OF LLOYD B. MILLER, SONOSKY, CHAMBERS, SACHSE, 

ENDRESON & PERRY, LLP 

This testimony is submitted jointly on behalf of the National Tribal Contract Support Cost Coalition, comprised of the Shoshone Bannock Tribes of Idaho, the Cherokee Nation and Choctaw Nation of Oklahoma, the Shoshone-Paiute Tribes of Nevada and Idaho, the Riverside San Bernardino County Indian Health Consortium 

of California, the Pueblo of Zuni of New Mexico, the Spirit Lake Nation of North 

Dakota, the Confederated Salish and Kootenai Tribes and Chippewa Cree Tribe of 

Montana, the Forest County Potawatomi Tribe of Wisconsin, the Little River Band 

of Ottawa Indians of Michigan, and the Copper River Native Association, Alaska 

Native Tribal Health Consortium, Arctic Slope Native Association, Kodiak Area Native Association, and Yukon-Kuskokwim Health Corporation of Alaska. 

The National Coalition believes that in advancing jobs legislation in the coming 

weeks Congress should seriously consider enhanced funding for ‘‘contract support 

costs,’’ because contract support cost monies directly fund jobs in Indian country. 

As this Committee is aware, contract support costs represent the fixed costs which 

Tribes and tribal organizations must incur when they carry out self-determination 

contracts and self-governance compacts with either the Bureau of Indian Affairs or 

the Indian Health Service. Contract support costs cover such federally-mandated 

costs as annual independent audits, but also other necessary costs including liability 

and property insurance, accounting costs and the like. The majority of contract support costs are set by an indirect cost rate that is established by either the National 

Business Center within the Department of the Interior or the Division of Cost Allocation within the Department of Health and Human Services, and the remainder 

of those costs are set directly by the BIA and IHS. 

As this Committee is also aware from its extensive work over three decades in 

amending the Indian Self-Determination Act, when the BIA or IHS underfund fixed 

tribal contract support costs, the tribal contractors are left with no choice but to 

leave program positions unfilled to make up for the difference. Contract support cost 

underpayments thus cost jobs. 

By contrast, restoring contract support cost payments that are due under contracts and compacts permits Tribes and tribal organizations carrying out BIA and 

IHS programs to restore jobs. This is why Tribes and tribal organizations have repeatedly explained to Congress that, despite its somewhat oblique name, the ‘‘contract support cost’’ issue is a jobs issue. Indeed, at even a high estimate of $100,000 

per full-time equivalent employee, every $10 million increase in contract support 

cost payments produces 100 additional jobs (and even more jobs under contracts 

with IHS, where healthcare services lead to additional revenues from Medicare, 

Medicaid and other third-party payers). 

The National Contract Support Cost Coalition requests this Committee’s assistance in securing an immediate infusion of contract support cost funding in an 

amount equal to the amounts which President Obama will shortly announce in his 

Budget for fiscal year 2011. By including such one-time funds in the new jobs legislation, Tribes and tribal organizations administering IHS and BIA programs will be 

able to hire the additional staff which the President’s increases will permit, not in 

the summer of 2011, but this summer in the year 2010. This acceleration in hiring 

in Indian country is critically necessary to help immediately combat some of the 

country’s highest unemployment rates. 

For instance, if the President proposes an FY 2011 increase in BIA contract support cost payments of $20 million–sums which would, in due course, eventually be 

transferred under tribal contracts in the summer of 2011, $20 million in BIA contract support cost funds should also be added to the jobs bill so that those positions 

can be hired now, without further delay. The same action is warranted in connection 

with the IHS budget where the President may propose a contract support cost increase of $45 million for FY 2011. 

Including contract support cost funding in the new jobs bill meets every identified 

criteria for stimulus funding. It will directly lead to increased employment; the 

funds can be immediately obligated within a few days after apportionment into existing contracts, and without the negotiation of any additional or supplemental 

terms; and contract support cost funds (together with other contracted funds) are 

already subject to rigorous and transparent annual independent audits. 

Thank you for the opportunity to present these views on behalf of the National 

Contract Support Cost Coalition. Coalition member Tribes and tribal organizations 

will be supplementing this testimony with their own individual statements. 

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PREPARED STATEMENT OF HON. CHAD SMITH, PRINCIPAL CHIEF, CHEROKEE NATION


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PREPARED STATEMENT OF HON. MERLENE SANCHEZ, CHAIRPERSON, GUIDIVILLE

INDIAN RANCHERIA


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Æ 


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