By: Kele Bigknife | Intern | bigknife@umich.edu

Theodore J. Griswold | Partner | ted.griswold@procopio.com

The Promise Zone Initiative was launched under the Obama administration in January 2014 to designate and aid a number of high-poverty urban, rural, and tribal communities to create jobs, increase economic security, expand educational opportunities, increase access to quality, affordable housing and improve public safety.  A community seeking designation was tasked with detailing how the Promise Zone designation would help accelerate and strengthen the community’s efforts for revitalization.  Selection as a Promise Zone partners the community with federal government liaisons to help the community gain a competitive advantage in applying for federal grants and loans, and to streamline the federal bureaucracy.  The goals of the program include boosting economic activity and job growth, leveraging private investment, expanding educational opportunities, and the secondary benefit of reducing violent crime.

The third and final round of selections for Promise Zone Communities was announced earlier this summer, and two tribes are among the nine additions.  The Spokane Tribe of Washington and the Turtle Mountain Band of Chippewa Indians in North Dakota join the Pine Ridge Indian Reservation of the Oglala Sioux Tribe in South Dakota (second-round admits), and the Choctaw Nation of Oklahoma (first-round admits) as “Promise Zone” communities.

The Promise Zone’s tag-line reads “a child’s zip code should never determine her destiny.”  The effects of being raised in an impoverished community historically correlates to the child’s odds of graduating high school, her health outcomes, and her lifetime economic opportunities.  Many tribal areas have seen the devastating effects of poverty, and have suffer from a lack of housing, jobs, health services, and educational opportunities.  However, with the help of the Promise Zone program, hope has returned to some of these communities.

Moreover, the program works.  The Choctaw Nation of Oklahoma is one of the oldest tribal communities in the US, and has seen some areas of its reservation at a poverty rate of nearly 52%. After receiving the Promise Zone designation, the tribe has received close to $100 million in federal investments that have funded new affordable housing, a health clinic, child development programs, a community center, and rural development projects that have provided some citizens with access to potable water for the first time.  Additionally, the Choctaw Nation has secured $21 million in New Markets Tax Credits to build an environmentally sustainable steel manufacturing facility, which will support approximately 300 new jobs in the region.

Pine Ridge Indian Reservation of the Oglala Sioux Tribe once faced poverty rates higher than 49% of their population, and has seen similar economic advances as the Choctaw Nation since being designated a Promise Zone.  The reservation has expanded access to high-speed internet, built water and sewage infrastructure within the community, and supported an after school meal program through the USDA Child and Adult Care Food Program.

With these Promise Zone tribal success stories, the future appears brighter for The Spokane Tribe of Washington and the Turtle Mountain Band of Chippewa Indians.  Some of the proposed plans for these tribes include creating jobs through investments in renewable energy, constructing affordable houses, establishing technology centers and regional food hubs, and reducing crime by updating law and order codes and community policing strategies.

If you are a tribal official or member of a distressed tribal community who missed out on this round of the initiative, there are still many ways to benefit from the program.  The US Department of Housing and Urban Development’s website maintains a comprehensive list of federal grant opportunities for distressed communities.  Communities who did not receive Promise Zone designations are welcome to apply for any of these grants and work toward their own, more promising future.

Kele Bigknife is a citizen of the Cherokee Nation and is in his third year at the University of Michigan Law School. He is a member of the Editorial Board for the Michigan Business and Entrepreneurial Law Review. Kele is a recipient of the 2016 Procopio Native American Internship.

Ted GriswoldTed is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.

Pope Francis Affirms the Importance of Indigenous Consultation in Indian Country

By: Nikke Alex | Intern
Theodore J. Griswold
| Partner | ted.griswold@procopio.com

On May 24, 2015, Pope Francis released his encyclical on the environment and the need for meaningful climate action. However, his official letter is not just about impact from climate change. It was also about inclusion. The 192-page document focuses on Indigenous Peoples’ rights to land and culture with the Pope proclaiming that Indigenous Peoples’ “should be principle dialogue partners, especially when large projects affecting their land are proposed.”

This idea of dialogue with Indigenous Peoples prior to development is not new. In 2007, the United Nations General Assembly adopted the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). The UNDRIP is a declaration among countries on how Indigenous Peoples should be treated and sets out how countries and their governments should respect human rights of Indigenous Peoples. One of the important topics of the UNDRIP is the right to Free, Prior and Informed Consent. Article 32 of the UNDRIP reads, “States shall consult and cooperate in good faith [emphasis added] with the indigenous peoples concerned through their own representative institutions in order to obtain their free and informed consent prior to the approval of any project affecting their lands or territories and other resources, particularly in connection with development, utilization or exploitation of mineral, water or other resources.”

President Obama, in December 2010, announced the United States’ support for the UNDRIP, but the United States Congress has yet to ratify it. Although the UNDRIP is not legally binding, it lays out pivotal human rights norms of Indigenous Peoples. This is critical for Indigenous Peoples. Free, Prior and Informed Consent means that Indigenous Peoples have the right to be consulted with and can make decisions on any matter that may affect their communities like mining, fracking, or water development projects.

Everyday Indigenous Peoples are fighting mineral development in their communities and, in many instances, were never consulted prior to development. For example, the San Carlos Apache Tribe has been fighting a land grab of Oak Flat – a sacred site – for copper mining. The reservation was originally set aside and protected through an Executive Order by President Eisenhower in 1955. For the past 13 years, the Apaches halted Rio Tinto and BHP Billiton from mining until December 2014 when John McCain and Jeff Flake (R-Ariz) snuck a provision into a must-past military funding bill that essentially gave Oak Flat to an Australian-British mining company. Sneaking a provision in a military appropriations bill does not amount to Informed Consent. And, this is San Carlos Apache land!

This is not the first time Arizona senators have been tied to abuse of natural resources on Indigenous lands. In 2012, McCain and John Kyl (R-Ariz) tried to push through the Navajo-Hopi Little Colorado River Water Rights Settlement Act of 2012 to ensure Arizona had water for mining to produce energy for southern Arizona cities and, ultimately, tried to force the Navajo and Hopi to waive their priority water rights. McCain even tried to ensure the Navajo Nation President and Council that they were negotiating in “good faith” of the Nation.

The Pope’s encyclical states, “For [Indigenous Peoples], land is not a commodity but rather a gift from God and from their ancestors who rest there, a sacred space with which they need to interact if they are to maintain their identity and values. When they remain on their land, they themselves care for it best.” The notion of Free, Prior and Informed Consent is basic. If a project is happening on your land, shouldn’t you be notified before it begins? This notice is critical, so Indigenous Peoples can exercise self-determination to decide what is best for their community and future generations.

Nikke Alex is a citizen of the Navajo Nation and is entering her third year at the University New Mexico School of Law. Nikke was the former Executive Director of the Black Mesa Water Coalition, an environmental justice non-profit that worked to replace coal-fired power plants with renewable energy. Nikke is a recipient of the 2015 Procopio Native American Internship.

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.

Sustainable Economic Development in Indian Country

By: Nikke Alex | Intern
Theodore J. Griswold | Partner | ted.griswold@procopio.com

Today, in mainstream media, the only economic ventures that people see Tribal Governments pursuing are mega gaming and mineral resource extraction. While many Tribes are engaging in both ventures, many other Tribes are not. Unemployment rates are very high in Indian Country. On average, the unemployment rate on reservations varies from 40% to 90%. Factors contributing to these high rates of unemployment include the isolation of Tribal communities plus the sparse education opportunities.

Creative programs are needed to help young Native people think outside the box beyond these two common economic ventures. In Southern California, one Native youth program has done just that. The American Indian Recruitment (AIR) Program promotes higher education and success in academics in American Indian communities. This past spring, AIR’s Leaders Project in partnership with the Tribal Learning Community & Educational Exchange Program offered a course to high school students entitled “Economic Development in Indian Country.” The course explored the pros and cons of various economic development strategies being used throughout Indian Country and the implications those strategies have on Tribal sovereignty.

As a part of the course, the high school participants were tasked with developing feasibility studies for a potential business in their Tribal communities. Dr. Joe Graham instructed his students to choose projects that reflected community values and their cultures. If Native People focus on their passions and community cultural wealth, then an economic venture is more likely to be sustainable.

On June 11, the students presented their completed feasibility studies at Hewlett-Packard in San Diego, CA. The students’ presentations were very thorough and well thought-out. Of the six presentations, the potential businesses ranged from implementing solar energy to starting a culturally-based hotel to creating a market that sells produce from local farms and gardens. Each of these proposals addressed a specific need of the students’ home Tribal Government. These particular presentations stuck out, because these are all examples of green business ventures.

Perhaps Tribal leaders should begin thinking outside the box as well. The opportunities for green business ventures are limitless. Tribal Governments can implement solar and wind, retrofitting programs, farmers’ markets, and artisans’ cooperatives. The transition to green business ventures promotes community and cultural values while conserving land, water, and air for future generations.

The transition to a green energy economy is becoming more realistic for Tribes. On July 13, Senator Martin Heinrich (D-NM) and Congressman Raúl M. Grijalva (AZ) introduced the Tribal Tax Incentive for Renewable Energy Act. This Act would allow Tribal Governments to take advantage of federal renewable energy tax credits, and, ultimately, these tax incentives would allow Tribes to exert their energy autonomy. Federal incentives like this Act could create more job opportunities, so young Native People can delve into the green energy economy. Looks like these forward-thinking AIR Leaders are headed in the right direction!

Nikke Alex is a citizen of the Navajo Nation and is entering her third year at the University New Mexico School of Law. Nikke has worked with Indigenous youth throughout the world developing leadership pathway programs that value and reflect sustainability. Nikke is a recipient of the 2015 Procopio Native American Internship.

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.

Buy Indian Act: What it Can Do for YOUR Native Owned Business

By: Stephanie Conduff | Attorney | stephanie.conduff@procopio.com
Theodore J. Griswold
| Partner | ted.griswold@procopio.com

Does your Native-owned business want to get into government contracting?

Does it have some government contracts, but want to expand your business?

The Buy Indian Act is an opportunity for your Native-owned business to generate revenue and establish quality past performance.

This month government has awarded contracts to a call center and a business selling arsenic-removal treatments for water supply and irrigation systems. Each one of these companies received 100% Buy Indian Small Business Set Aside in the last two months. The Senate Indian Affairs Committee is having a listening session today at 2:45 EST in 216 Hart Senate Office Building in Washington, D.C. to better understand what can be done to empower Native-owned businesses. This signals that changes to strengthen the Buy Indian Act could be on the horizon from Congress.

The Bureau of Indian Affairs (BIA) rules state pursuant to the Buy Indian Act they must give Indian businesses first preference in procurement matters by seeking contract offers from at least two Indian Economic Enterprises (IEE). The definition of an IEE is that it is a for-profit business that is at least 51% Native owned or 51% owned by a tribal government. When the BIA has the two offers on a contract they must select one of them that is an IEE, so long as it is of a “reasonable and fair market price.” And that’s a lot of discretion when you are debating what is reasonable to government procurement officers.

The BIA may deviate from the rules only in specific circumstances, such as when no offers are received from any IEEs or when only one offer is received and it is not reasonable.

I recommend that Native businesses seek opportunities often at Federal Business Opportunities. You can set up an alert that emails you directly when an opportunity arises that matches the goods or services you provide is available.

When looking for a Buy Indian Act opportunity, teaming is encouraged, because subcontracting is permitted. And remember that least 50 percent of the subcontracted work must go to IEEs and this empowers the Native business to learn from the partnering business and build its own capacity through increased opportunities.

To be eligible under the Buy Indian Act there are the 5 requirements:

  1. The business must be an Indian Economic Enterprise (IEE). The definition of IEE is that it is a for profit business that is at least 51% Native owned or 51% owned by a tribal government.
  2. The IEE owners must be citizens of a federally recognized tribal government or Alaska Native village.
  1. The IEE must manage the contract.
  1. The Native person or tribal government must receive majority of the earnings from the contract.
  1. The Native person or tribal government must control the daily business operations.

Here is the other great news – the scope extends beyond just the BIA. To increase the economic impact of the Buy Indian Act, the rules authorize that the Department of Interior may delegate the mandate to other bureaus in the department like the National Park Service and the Bureau of Land Management. What do you make that our national parks need? Maybe you sell t-shirts? Or provide office supplies? Or pesticides? Or fire land management?

Our government has immediate contracting needs and your Native businesses can fill them today – if you seize the opportunity!

Stephanie Conduff, a citizen of the Cherokee Nation, is a member of the firm’s Real Estate and Environmental Team and a member of the Native American Law practice group. Her practice emphasizes working with tribal governments, individual Native people, and companies doing business in Indian Country. She provides advice and strategic policy analysis on national regulatory issues and advises clients of the legal and policy issues. Stephanie’s work focuses on tribal sovereignty and self-governance, tribal lands, the federal trust responsibility and working with businesses in Indian Country.

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.

Tribal Governments Can Maximize Their Economic Development Opportunities and Affirm Their Self-Governance by Updating Tribal Commercial Codes

By: Sandra L. Shippey | Partner | sandra.shippey@procopio.com
Stephanie Conduff | Law Clerk | stephanie.conduff@procopio.com
Theodore J. Griswold | Partner | ted.griswold@procopio.com

Tribes and their members are regularly engaging in commercial transactions by ever increasing numbers. Also increasing are commercial financing transactions to support the tribe’s commercial activities. Sometimes, tribes or tribal members need to borrow money to support their commercial activities from lenders who will require that personal property collateral be pledged to the lender to secure the borrower’s obligations under the loan documents. One of the biggest impediments to gaining such loans is a lender’s unfamiliarity in dealing in Indian Country. Tribes have a useful tool that can both minimize this lender concern and allow the tribal government to exert is own control over financial dealings.

The Uniform Commercial Code is a set of legal rules covering many important business and commercial activities. It was proposed for the purpose of making commercial business transactions more predictable and efficient by making commercial laws consistent across all 50 states. Article 1 provides definitions and general principles that apply to the entire Uniform Commercial Code and Article 9 of the Uniform Commercial Code covers security interests in personal property. A security interest is the creditor’s claim to the personal property to secure the performance of an obligation, usually the payment of a debt. A secured transaction is an agreement where one party gives to another party a lien on property, other than real estate, as collateral for a loan or other financing transaction.

Lenders are familiar with the rules in the Uniform Commercial Code and they know what to do in all 50 states to create an enforceable security interest and to make sure they have first priority in their collateral in relation to other creditors. Therefore, lenders making loans in Indian Country have often included language in their loan documents requiring tribes to adopt, as their own law, all or part of Article 1 and Article 9 of the Uniform Commercial Code of the applicable state where the tribal lands are located, and for the tribe and its business entities to consent to the jurisdictions of the courts in that state rather than tribal courts. However, that law may not adequately reflect the tribe’s culture and values.

There is an alternative. Tribes can adopt their own version of the Uniform Commercial Code. If the legal concepts in the tribal law are familiar to lenders, it should make lenders more comfortable making loans to the tribe and its businesses. This will help the tribe attract more lenders to finance new tribal projects. In 2005, the Uniform Law Commission (ULC), with support from the Federal Reserve Bank of Minneapolis published the Model Tribal Secured Transactions Act (the Model Tribal UCC) and proposed that it be adopted by Indian tribes to create a relatively uniform system of commercial laws in Indian Country that are similar to the commercial laws found in Article 1 and Article 9 of the Uniform Commercial Code. The Model Tribal UCC contains similar core principles, terminology and procedures as those contained in Uniform Commercial Code. However, each tribe can adopt a customized version of the Model Tribal UCC which will give each tribe the ability to affirm its own sovereign immunity and self governance and incorporate its own tribal customs and traditions into the law.

With 567 federally recognized tribal governments in the United States, there are many opportunities for business transactions between tribal governments and tribal business entities and outside lenders. If a tribe has not adopted any form of the Uniform Commercial Code, lenders are likely to require the tribe to adopt the local state’s Uniform Commercial Code and that may not be consistent with the tribe’s needs. By adopting a customized version of the Model Tribal UCC to fit its specific tribal culture, values and needs, a tribal government can be proactive, transparent and choose tribal courts to enforce any disputes. This will encourage lenders to provide capital for tribal projects and continue to grow the opportunities in tribal communities to encourage business development and self governance in Indian Country.

For a more extensive discussion of this issue, click here.

Sandy Shippey is a member of the Native American Practice Group and the State Bar of California – Business Law Section Uniform Commercial Code Committee.

Stephanie Conduff is a citizen of the Cherokee Nation and a former Procopio Native American Intern. She graduated from the University of Oklahoma College of Law and is currently preparing to sit for the Oklahoma Bar Exam before returning to Procopio.

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.

Opportunities and Threats to Indian Country Business: E-Commerce and Tribal Sovereignty

By: Christopher Scott | Intern
Theodore J. Griswold | Partner | ted.griswold@procopio.com

Many tribal governments are in serious need of economic development avenues. As sovereign nations within U.S. borders, they have the inherent authority to bypass laws and regulations that regulate business relationships with non-tribal online retailers, tech start-ups, and even larger digitally-focused companies interested in hospitable climates for expansion.  E-commerce, once a fledgling industry, is on track to far surpass in-person transacting by both volume and value.  The Internet could provide those tribal governments and their businesses with a virtual mobility sufficient to maintain a worldwide customer base.

In order to curtail that growth, the states could force the courts to address the issue of what I have termed “e-sovereignty” in the most unfavorable context for tribal governments — that of payday lending.  For sovereigns and their advocates, the time is now to carve out a niche for tribal e-commerce both online and in the case law.

One case in particular that should be watched closely is Otoe-Missouria Tribe v. New York Dept. of Financial Regulation.  The State of New York has attempted to shut down the tribal governments payday lending operation with cease-and-desist letters and other investigatory tactics.  The tribal government has responded with a lawsuit seeking injunctive and declaratory relief as against the State’s regulators and its usury laws.  The New York State District Court that first heard the case ruled last year in favor of the State, relying on general principles of lending law outside of either the online or tribal context.  A Second Circuit’s decision on the Otoe-Missouria’s appeal is due soon, and its reasoning could lay the groundwork for future decisions involving tribal e-commerce far beyond the realm of lending.

It would behoove both Tribal businesses and their champions to maintain a vigilant focus on this area of the law and to make their voices heard in support of e-sovereignty.

Although the information contained herein is provided by professionals at Procopio, the content and information should not be used as a substitute for professional services. If legal or other professional advice is required, the services of a professional should be sought.

Christopher is a citizen of the Cherokee Nation and just completed his second year at the University of Oklahoma College of Law. 

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.