June 26, 1979 — Committee on Interior and Insular Affairs, US House of Representatives, Washington DC

Thank you, Mr. Chairman. I will try to talk through my testimony rather than reading it so that we can get into questions. We are sorry that the Congressmen from Montana and Colorado had to leave, there were a lot of things that I would have liked to have responded to them directly.

As you see in my testimony, I said 500 years ago we were self sufficient, and then in the mid-1800’s we were about 80 percent dependent on the Federal Government, and now on the current status tribes on the reservations are 90 percent dependent on Federal Government programs.

Coming to try to understand American spending opportunities, the organizations of generalists who try to get information together to be of assistance, both to the tribes and to the Federal agencies, are advocacy organizations, and it may show in the testimony, somewhat. So I would like to mention that the EDA did help us, in a small contract, come to some of the opinions that we have come to in our paper.

One of the things that we did find out, that this dependency, and if you notice that I have named my paper, “The Colonization of Indian Economy” and I think there is a real colonial attitude, both nationally, and perhaps starting with the Congress down to Federal agencies, where we have a piecemeal approach to economic development. Everyone is preserving his own turf, referring to the agencies, and that we actually get into turf fights. That we are program by program, project by project, and all the moneys expended then, never materialize into, it does not really flow.

I think Mr. Black referred to the fact that, whatever is popular this year is not necessarily popular next year. So it is not what tribes have planned, it is what the Federal Government has planned for the tribes, and again, it is a colonial attitude.

Then, when we have resources, such as timber energy, and we can get into the energy thing, we have gotten into a colonial attitude again in extracting those resources as raw materials rather than using and developing those resources to develop industry or whatever, using the resources on the reservations that belong to the tribes, we try to manufacture industries, such as bringing them from the east coast, put them in an isolated area on a reservation. And so therefore, those things have not worked.

And I think it is important to note that my staff, when using more graphic terms, that Federal programs were creating an illusion of economic activity when in reality, Federal programs are actually flushed through the reservation economy, 60 percent, and then I want to go to that graph, if you will to — that information comes from the Policy Review Commission. And graph No. 1 shows the appropriation that the Congress, in its good wisdom, appropriated and then what happens to it. Actually, some of it goes to the reservation but when it actually comes down, only 5 percent actually stays on the reservation.

How do we stop that from happening, is what the question, I think what we are all about. I appreciate the paper that the committees’ staff produced. I think it is one of the most outstanding papers I have seen around in a long time and we like it, because some of the quotes came from some of the studies we made. It is quite outstanding.

In any given community, as an example, the dollar turns over seven times. In the poorest community, even Appalachia, it does not turn over even once. Now why has that not been thought out by our Federal agencies in planning economic development? They are going in with piecemeal projects and you can just bind them up. And they are all pocketed in little separate units. And, if you cross over once, well, just in the creation of CERT alone, when the tribes decided they wanted to organize CERT, what kind of turf fights we got into then, was an interesting example and a great study if you would care to take what happened. Though they all came around, the agencies came around to understanding, and again, Mr. Miller, I think it was, who said, “We got all excited about the energy on the reservations,” it was the old story about hitting the mule in the head with the fence post in order to get his attention.

Nobody was paying any attention. Certainly not the Interior Department, or the Department of Energy. How could you make policies of those magnitudes when you have the biggest private owners of energy? So we had to dramatize the problem. And in dramatizing the problem, we have people like our Congressman from Montana making comments that he has made. And so it has hurt us in a lot of ways because we have had to overemphasize, because Congress and the agencies did not recognize that.

I would like to then jump over to the second set of illustrations. And those are generalized. Of course if you take the uranium thing you could, through integrated ownership by energy companies, that whole thing other than the Indian share is probably pocketed by one company. If you look at it very closely. And I also would like to comment on what the Congressman from Montana said, that some of the tribes get 17 cents to 40 cents a ton for their coal and the State of Montana gets $3 to $4 for that same coal. That is not to say what is happening in the profit of that company. So even though energy is so important, I mean, it looks like a big thing, look at the share of profit that the Indians are getting out of their own resources. And you can take any resource where the Interior Department or the Federal Government has the regulations on it in such a way, or has been, let me say administering the regulation in such a way that you can say — the same way in timber. And I used that example. The same way in the coal thing. It was pointed out to me by one of my colleagues that the State taxes received was twelve times that of what the tribes get even in the area of coal.

We give you those kinds of examples that the States are benefiting from it when the raw material actually comes from the reservations, still that dollar does not stay there.

And it is not working. It is not working for them because we have lost our traditional ways of economy and we have not set up substitute interest structures in order to make them work.

There are areas, in our Chairman’s State of Arizona, the Ak Chin Maricopa project, the successful farming operation, where they actually made $2 million in the year of 1975. The other is the Lummi aquaculture development where they have made success. But the interesting thing was that they, in most cases, started those things on their own and then the Federal Government comes in like somebody was saying earlier, that it took the whole, entire Federal agency structure to create 25 jobs on reservation. But they do not look at the tribe as a whole, they are project by project, and so there is no holistic approach and none of the agencies can, that work with each other, though the administration says there should be interagency agreements and that CERT is probably the first example of an interagency agreement, and that came out of a great deal of pressure from the tribes and Members of the Congress, to make that come about. It was not any, it took two years, as a matter of fact, to make that happen. And then the tribes decided to do it.

There is a colonial attitude about the approach to economic development. They do not look at the tribe as a whole. That Indian politicians are as good as any other politicians if there is going to be a dollar coming in, they are going to take it. Not actually meaning what they wanted to do, it did not have anything to do with what they originally planned, but, you know, it is there. And I think one of the questions being asked by one of the Members of Congress is that Indians hire their relatives and so forth.

We are such a small community of people that, as Mr. Black says, we are hollow related anyway. But I would like to see any other, including the Federal agencies function. When we started looking at projects, oh, goodness like poor Indians, lo, the poor Indians, we are just poor administrators. And we looked around, and many of the other agencies, governmental entities do not function any better. When Mr. Reynolds was here earlier, if you looked at what was happening in Sandoval County or at Albuquerque, see that it is not any better condition than the tribe itself. And tribal government in the way they are structured. And just think that we are only, the way we are presently structured, that we are only ten years old. And you are asking us to take on an economy that is as old as this country and not an economy that we are accustomed to. But we are doing it, we are making leaps and bounds in that direction against the influence against the negative influence of Federal agency regulations, and mostly our regulations that are being obstructed.

I have kind of bounced around. I also passed around this to show you a little bit of the Navajo. This is just Arizona, not including New Mexico. I kind of just rambled on all over this place. I hope I have been provocative enough to get some questions.

The Chairman. You have a good statement and you have a knack for going to the heart of the question. I liked what you were saying about the HUD policy and the overlapping set of programs. We spent the better part of 6 weeks, in a series of four or five hearings, hearing from the different agencies that are set up in part to assist Indians and Indian tribes. Frankly, I did not know all of these programs existed. We had the Small Business Administration, we had the Department of Labor. We were surprised to find that HEW had a big chunk of the program. Some are grants, some are loans, some are technical assistance. They are all different. I do not blame the tribes. If your program is here, but there is no money in that program, and you can get something like it from another program, why you would get on an airplane and get back here and get it under that one.

Ms. HarrIs. The tribes now for instance, Walker River is a good example. We are going to meet with them tomorrow. Walker River tribe in Nevada. And they are, they have tried to develop a wholistic approach and saying, “OK. How do you use the Federal moneys, then, if this is, we can use DIM moneys to do this, then how can we use EDA moneys to be a primer, to make this all kind of work together in some kind of fashion?” And no, not at all. What they did, they went to the regional offices and they said, “Well Heavens no, we won’t fund that.” And so they raised heck for a little while and they said, “But we will fund something else. We cannot work with the Interior Department on something, but we will work with you on something else.”

This came after some deal of pressure put on some of the tribes by Members of the Congress. Then they came back to say, I mean it is a good example of how it does not work. And the reason why the group did a kind of study and following how they were trying to make this work together. You know, get this kind of cooperation from the agencies. And in studying them, they found then, so the Regional EDA Office says well, the reason we did not do that, they came straight to Washington, rather than coming to us, so we treated them that way. And so again, you get in this turf fight. We met with the Area Director in Albuquerque and he said, and we were talking with one of the tribes out there about their water problem. The Department of Interior is responsible for its agriculture water. The Department of Indian Health is responsible for its domestic water. All right, nobody is responsible for the pollution of uranium and the grants development that is coming down on them. So, we started talking to EPA. But none of those will talk to each other. Though, I must say, the Area Director made some attempt to. But this is a projection of everybody, it is all fragment ed. And trying to put it together, here is the Tribal Counsel trying to run, to take care of the sewer from the, you know, pick up the garbage to — coping with international developers who are coming on the reservation to develop coke, you can just imagine what is like to try to get basic, decent information that you make an intelligent decision when you are confronted with this. And you are fighting your friends, I mean your trustee at the same time who are supposed to be doing these good things for you.

The Chairman. When we get all through, we are going to see what legislation might be indicated by all this. One of the thoughts that went through my mind, was the possibility of legislation which works on the principle of general revenue sharing with the States. Say to the tribes, “We will send you so much money, a percentage of all these Federal funds and let you decide how to use it rather than the Federal Government deciding. The funds are available. You can decide what programs to put together and where you really need it.” Maybe we could develop a revenue sharing program where the tribes could get their share in that fashion.

Ms. HARRIS. I would like to see something like that. Because, one of the questions that the Congressman from Montana asked in regards to — well the tribes signed off on a leasement. A tribe signed off on a lease with 17 cents a ton for coal with no information whatsoever, furnished by them. And you know, in the old days, we have made studies of it, the Interior Department just pulled out an old lease, a 50-year-old lease, and they filled in the company’s name and the tribe’s name. And the tribes, that is all the information they had, how could they make an informed decision? Then when they try to go back and try to renegotiate that situation on royalty, such a poor agreement, then people get up tight about it and say the company, you know the companies and the States are kind of uncomfortable about the situation. When we are trying to act in a businesslike way. And the other question you asked about — there are several large financial institutions now interested because of energy, but they would also be interested in timber and any other kind of enterprise. But private corporate money, along with using the Federal dollar as a primer. Equitable Life, the president of Equitable Life happens to be on our board of directors and he has called a group together and has talked with the Energy Department. There are all kinds of ways of making this work but we have been so colonialistic in our attitude that we know what is good for Indians, those little brown devils can not manage for themselves and so we do it for them. So that we are emotionally and financially totally dependent on the Government.

The Chairman. Let me interrupt here and see if Mr. Miller has any questions.

Ms. HarrIs. All right.

Mr. Miller. I want to thank you for the presentation. And thank you, Mr. Chairman. I wanted to talk to the representative from CERT also. One of my concerns is, what the energy potential for the tribes leverages in terms of other economic development for nonenergy owning tribes. I do not know how you do that. I do not know how you subcontract out and how you share, but it seems to me that past economic development and your testimony, if correct, Ms. Harris, points this out, and this is one of the problems I found with the development of these industrial parks was they were really set up to sort of attract non-Indian industry because there was a great benefit to the non-Indian industry if they could locate there. But it was not designed to build a structure on the reservation. So, you know, if you look at the State of Louisiana, you find out that when offshore oil was developed, that there is an entire structure, and Louisiana sometimes, with all deference to my colleagues, I call the biggest company town in the world. There are people who run catering services to the offshore rigs, there are tow boats to the offshore rigs, there are service boats. They are all independently owned — probably within families. But definitely, a structure has been built there. My concern is that when you talk about the development of uranium, you talk about timber, you talk about coal, that the Federal Government helped to build that structure. Where there are subcontractors, where there are people who make component parts of the machinery, service machinery, in fact they may even build machinery, we found out that when the OPEC nations took their action in 1974, American companies that built drilling rigs and all of the associated equipment were tripping over themselves to set up plants to keep the goodwill of the OPEC ministers by generating jobs and structures and training and scholarships and the whole business for those people.

I was in Mexico a couple of weeks ago, and we are tripping over ourselves to help the Mexican people where we ignored them for 200 years, because they have energy. And my concern is that the tribes have the ability, whether it is front money for planning and development, whether it is educational money, to develop and to market these resources as a cohesive unit and also to see, to investigate, which may bring no immediate financial return, but to investigate how you spin this off into those other tribes that are not fortunate enough to have energy under their lands.

It seems to me that CERT is the first promising ray of light in that progression to try to bring comprehensive development. The chairman’s idea has been running through my head also. Somehow you have to put the money out there and let those people make the decisions.

Ms. HarrIs. Mr. Miller, I want to comment and then I will let Ed respond as well. Two things about what you said is that the way those resources were managed and the horrible contracts those tribes got into on these lease agreements are just notorious. We have had people, international attorneys who have worked with developing nations say that they have not seen anything like those other than maybe in South Africa. It is not anything like the agreements that the companies — that the same companies, an American company on the reservation. So not until the tribes got to recognize this — and that is why the organizer — they recognized that they were being ripped off. They recognized these things, trying to reverse these kinds of happenings to them. And now, and the spinoff things, this is a nonrenewable resource, it is going to be gone. What is a spinoff? You know, what is the old story of taking in each others laundry? How do we get that dollar turning over? Part of that is not written into the contract, and many of the tribes are now trying to renegotiate that, I might say, with not much help from the Interior Department — and none at all, is the fact. And they just when — the Northern Cheyenne is a good example of that — when they finally decided that they did not want, that it was not worth it, because it was cultural genocide to go ahead and develop, they tried to stop. So first of all, we want to plan it and do it ourselves. We want to figure out how we want to do it, if and when we want to do it, and not have all of this happening to us in such a horrendous kind of way. And since it is a nonrenewable resource, we better figure out how to do it because the tribes in those old contracts are really hurt and there is no way.

Now, you happen to have another understanding about tribes. We are individual nations. I have — probably my worst prejudice is the Comanches against Kiowas, and I hope Kicking Bird is not here. But, you know, we have these tribal situations. We are not compatible. We are culturally different than one another. Now, one tribe may get along with somebody else but that is like you would have to work out some common market situation and you could. But we, if you will notice where, for instance, in fisheries and the tribes in Washington State, they are getting the going price for fish because they are doing it themselves, but when the Bureau of Indian Affairs is managing the timber, they are getting you know, we know just on AIL, just scratching the surface; we are not even good analysts, but scratching the surface; we know we are losing ten million a year, tribes are on the way that timber is being managed and cared for and produced. And there is just all kinds of ways that it does not have to necessarily be associated with energy. On agriculture land, Winnebago is just now getting back a 99-year-old lease agreement they got into where the farmers in Nebraska are making all kinds of money off of their land. They are sitting there getting minute pieces of royalty from that payment, from payment of the lease on that land. Now they are going to go into, if it is not too late and there is — they can find somebody who can farm, they are going to go into that.

Mr. Miller. My concern is that the national concern with energy, and the resources the Indian tribes possess, and our need for those resources, somehow bring about the change of attitude in Interior, in the Department of Agriculture, in BIA, as to the plight of non-energy owning tribes. I am sure the energy-owning tribes in the future may be treated royally by governmental bureaucracies. What about the brothers?

Mr. GABRIEL. I agree with that, Congressman. I think that that is what CERT is beginning to do, I was going to say, has done. I think it is beginning to do that. We are starting to make headway on all kinds of different concepts that when it comes down to it, it is let the tribes do for themselves. Just give them the capacity and capability to do it. We are starting to turn that around and we are using that leverage.

Industrial parks may be the best thing last year, but energy really is a sexy issue this year and we can capture that and get the Federal Government to live up to their commitments to start looking at self-determination in the right way, capacity building in the right way, and so forth. I would like to also respond to, I think, something that you were mentioning earlier, and that is that I see the Federal Government being more of a deterrent than a help. It is easy for us to criticize somebody else all the time but basically, you got Federal co-leasing. Now, it is not even competitive. You got foreign governments that get a better — we are subsidizing the energy companies. So what is the Indian coal worth. It is getting less and less. If the Government gets into leasing Federal coal, you have got a closed-minded attitude by Federal bureaucrats. They do not understand long-term planning, capacity building, putting the skills in tribal governments that are needed. They got a categorical program to stick out there and say, “Here is a million bucks. Take it.” Well, yeah, they are going to take it. But what does that do to tribal decision making? Nothing. Congressman [Mo] Udall mentioned revenue sharing. Maybe that is the way to go to get away from these categorical funded ideas. And we have got a very ignorant bureaucracy in terms of looking at new ideas. We are just in a very, ever-changing field. Who the heck knows, in the Department of the Interior, about synfuels and gasification liquefaction service contracts that may have happened overseas. We could go on and on. But yet, these are the people we have to deal with everyday and bring them along and work with them, and all we get is problems. So somehow, we have got to bring them along slowly. The Indian people have to be leaders in the field again and they are going to have to teach the Federal Government how to do things, in my opinion.

Ms. Harris. I liked what you said about using the energy, be cause what energy, how we have used energy, is for instance, is to get private moneys and capital for a tribe. And that has been a new idea, and who did we have to fight the hardest for the concept of it? You just cannot imagine the barriers that are thrown — I think in our testimony we have some barriers to development that I hope you will look at and see some of the things that we see. There are newer ways of looking at things and because we are all so specialized in the Federal agencies that we have one little view of it and that is the only view that we have and it just seems impossible.

What has helped us in our organization is to look at tribes as developing nations. When you look at them in that way, then you can look at them holistically. You cannot talk about energy, you cannot talk about housing, you cannot talk in separate units be cause they all impact on each other, and whether it is building a shopping center or a hospital, how does that impact. Who is going to police the new tourist center or whatever. Who is going to police the new tourist. Where is the water coming from, if you are in the Southwest? All the different kinds of things.

We have a brand new hospital out on the reservation, yet we cannot build housing units to staff it because we do not have enough water. You have a shopping center sitting there fully equipped with laundromats that has been there for two years that we cannot open because of the water. Nobody thought, nobody looked at it in a whole way. And it is just all these piecemeal things.

And then they say look at all that money. Some of your colleagues will say, “Look at all that money we are putting on those Indian people and look what they are doing with it. They cannot make a success of this; they are darned ignorant; they cannot do it.” Well, it is the way the money is being programmed and the regulations that go along with it. You have to be a Philadelphia lawyer to figure out the regulations and make it work. Each agency requires a different set of regulations so that if we do not have an overall approach, I think again we are just pouring money into something, we are flushing it through and that other people are benefiting from moneys that it appears that Indian people are getting.

Source: Oversight Hearings before the Committee on Interior and Insular Affairs, House of Representatives, 96th Congress, 1st session, (Washington DC: US Government Printing Office, 1979), pp. 26-34.