[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]



 
                          NAHASDA: 20 YEARS ON

=======================================================================

                             FIELD HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                         HOUSING AND INSURANCE

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 21, 2017

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 115-35
                           
                           
                           
                           
                           
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                 HOUSE COMMITTEE ON FINANCIAL SERVICES

                    JEB HENSARLING, Texas, Chairman

PATRICK T. McHENRY, North Carolina,  MAXINE WATERS, California, Ranking 
    Vice Chairman                        Member
PETER T. KING, New York              CAROLYN B. MALONEY, New York
EDWARD R. ROYCE, California          NYDIA M. VELAZQUEZ, New York
FRANK D. LUCAS, Oklahoma             BRAD SHERMAN, California
STEVAN PEARCE, New Mexico            GREGORY W. MEEKS, New York
BILL POSEY, Florida                  MICHAEL E. CAPUANO, Massachusetts
BLAINE LUETKEMEYER, Missouri         WM. LACY CLAY, Missouri
BILL HUIZENGA, Michigan              STEPHEN F. LYNCH, Massachusetts
SEAN P. DUFFY, Wisconsin             DAVID SCOTT, Georgia
STEVE STIVERS, Ohio                  AL GREEN, Texas
RANDY HULTGREN, Illinois             EMANUEL CLEAVER, Missouri
DENNIS A. ROSS, Florida              GWEN MOORE, Wisconsin
ROBERT PITTENGER, North Carolina     KEITH ELLISON, Minnesota
ANN WAGNER, Missouri                 ED PERLMUTTER, Colorado
ANDY BARR, Kentucky                  JAMES A. HIMES, Connecticut
KEITH J. ROTHFUS, Pennsylvania       BILL FOSTER, Illinois
LUKE MESSER, Indiana                 DANIEL T. KILDEE, Michigan
SCOTT TIPTON, Colorado               JOHN K. DELANEY, Maryland
ROGER WILLIAMS, Texas                KYRSTEN SINEMA, Arizona
BRUCE POLIQUIN, Maine                JOYCE BEATTY, Ohio
MIA LOVE, Utah                       DENNY HECK, Washington
FRENCH HILL, Arkansas                JUAN VARGAS, California
TOM EMMER, Minnesota                 JOSH GOTTHEIMER, New Jersey
LEE M. ZELDIN, New York              VICENTE GONZALEZ, Texas
DAVID A. TROTT, Michigan             CHARLIE CRIST, Florida
BARRY LOUDERMILK, Georgia            RUBEN KIHUEN, Nevada
ALEXANDER X. MOONEY, West Virginia
THOMAS MacARTHUR, New Jersey
WARREN DAVIDSON, Ohio
TED BUDD, North Carolina
DAVID KUSTOFF, Tennessee
CLAUDIA TENNEY, New York
TREY HOLLINGSWORTH, Indiana

                  Kirsten Sutton Mork, Staff Director
                 Subcommittee on Housing and Insurance

                   SEAN P. DUFFY, Wisconsin, Chairman

DENNIS A. ROSS, Florida, Vice        EMANUEL CLEAVER, Missouri, Ranking 
    Chairman                             Member
EDWARD R. ROYCE, California          NYDIA M. VELAZQUEZ, New York
STEVAN PEARCE, New Mexico            MICHAEL E. CAPUANO, Massachusetts
BILL POSEY, Florida                  WM. LACY CLAY, Missouri
BLAINE LUETKEMEYER, Missouri         BRAD SHERMAN, California
STEVE STIVERS, Ohio                  STEPHEN F. LYNCH, Massachusetts
RANDY HULTGREN, Illinois             JOYCE BEATTY, Ohio
KEITH J. ROTHFUS, Pennsylvania       DANIEL T. KILDEE, Michigan
LEE M. ZELDIN, New York              JOHN K. DELANEY, Maryland
DAVID A. TROTT, Michigan             RUBEN KIHUEN, Nevada
THOMAS MacARTHUR, New Jersey
TED BUDD, North Carolina


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    July 21, 2017................................................     1
Appendix:
    July 21, 2017................................................    37

                               WITNESSES
                         Friday, July 21, 2017

Frechette, Heidi, Deputy Assistant Secretary, Office of Native 
  American Programs, U.S. Department of Housing and Urban 
  Development (HUD)..............................................     5
Gokee, Rosalie, Governing Board Member, Lac Courte Oreilles Tribe    14
Malcolm, Harry, Doctor, Essentia Clinic..........................    10
Montano, Mark, Executive Director, LCO Housing Authority.........    12
Tortalita, Floyd, Executive Director, Pueblo of Acoma Housing 
  Authority......................................................    15
Tribble, John, member, Lac Courte Oreilles Tribe.................    17
Walters, Tony, Executive Director, National American Indian 
  Housing Council................................................     8

                                APPENDIX

Prepared statements:
    Waters, Hon. Maxine..........................................    38
    Frechette, Heidi.............................................    41
    Gokee, Rosalie...............................................    48
    Malcolm, Harry...............................................    55
    Montano, Mark................................................    58
    Tortalita, Floyd.............................................    64
    Tribble, John................................................    76
    Walters, Tony................................................    77

              Additional Material Submitted for the Record

Pearce, Hon. Stevan:
    Letter from Bill John Baker, Cherokee Nation Principal Chief.    82
    Lac Courte Oreilles ICDBG Mold Remediation Project Completed 
      Homes Photo Album..........................................    85
    Written statement of Moises Loza, Executive Director, Housing 
      Assistance Council.........................................    92


                          NAHASDA: 20 YEARS ON

                              ----------                              


                         Friday, July 21, 2017

             U.S. House of Representatives,
                            Subcommittee on Housing
                                     and Insurance,
                           Committee on Financial Services,
                                                   Washington, D.C.
    The subcommittee met, pursuant to notice, at 9:15 a.m., at 
the Lac Court Oreilles Ojibwe School, 8575 North Round Lake 
School Road, Hayward, Wisconsin, Hon. Sean P. Duffy [chairman 
of the subcommittee] presiding.
    Members present: Representatives Duffy and Moore.
    Also present: Representative Sensenbrenner.
    Chairman Duffy. The Subcommittee on Housing and Insurance 
will come to order.
    Today's hearing is entitled, ``NAHASDA: 20 Years On.'' 
Without objection, the Chair is authorized to declare a recess 
of the subcommittee at any time.
    Also, without objection, members of the full Financial 
Services Committee who are not members of this subcommittee may 
participate in today's hearing for the purposes of making an 
opening statement and questioning the witnesses.
    Ms. Moore, we welcome you today, and appreciate you 
traveling from Milwaukee to be at today's hearing; thank you 
for that. And without objection, the gentleman from Wisconsin, 
Mr. Sensenbrenner, has committed to participate in today's 
subcommittee hearing. Mr. Sensenbrenner, we welcome you today 
and appreciate you coming from the suburbs of Milwaukee, 
leaving the urban area and coming to the heart of Wisconsin up 
north, so both of you, welcome.
    The Chair now recognizes himself for 5 minutes for an 
opening statement.
    The Native American Housing Assistance and Self-
Determination Act (NAHASDA) was enacted in 1996 to provide 
Native Americans greater self-determination and self-governance 
in how to spend Federal affordable housing funds.
    Prior to the establishment of NAHASDA, Native American 
tribes received assistance for affordable housing through 
various Federal programs such as housing development and 
modernization grants, public housing operating subsidies, and 
Section 8 rental assistance through the 1937 Housing Act.
    Under the Act there were no specific provisions related to 
treatment of Native Americans addressing the unique 
circumstances for how to provide assistance to those living on 
tribal lands under sovereign governments.
    NAHASDA sought to change that by streamlining multiple 
channels of housing assistance to Native Americans into two 
programs: the Indian Housing Block Grant Program; and the Title 
VI Tribal Housing Activities Loan Guarantee Program.
    The goal of NAHASDA was to assist and promote affordable 
housing activities in safe and healthy environments on Native 
American reservations, in order for Native American areas that 
occupancy low-income areas and families to be better helped.
    It also sought to ensure better access to private mortgage 
markets for Native American tribes and promote self-sufficiency 
for those tribes.
    By coordinating activities to provide housing for tribes 
and their members at the Federal, State, and local level, 
tribes were then able to plan and integrate infrastructure 
resources to develop housing.
    Importantly, tribes were also given the ability to promote 
development of private capital markets for the benefit of 
Native American communities.
    Today, we have a number of witnesses who are involved in 
NAHASDA, but I have asked a few here today to also address a 
rising problem in our Nation, and that is the problem of mold 
that is affecting our low-income housing community, especially 
our Native American lands.
    The last time NAHASDA was reauthorized with changes was in 
2008 and the program was extended for 5 years. Since 2013, we 
have not had a successful reauthorization, but instead have 
simply been appropriating funds.
    I hope that this hearing will provide some insight as to 
how the program is faring and what changes need to be made, 
specifically those changes under H.R. 360 that passed the House 
of Representatives last year.
    As I have looked into NAHASDA, I have learned that Native 
American tribes generally view NAHASDA positively because of 
the emphasis on self-determination.
    However, one particular issue has caught my attention, and 
that is the amount expended but unobligated of NAHASDA funds. I 
want to make sure that our tribes that are being awarded money 
are taking proper initiative to put those dollars to work and 
ensure their tribal members are living in safe and healthy 
affordable housing.
    Just this morning the members here with me today had an 
opportunity to tour one of the homes here at LCO, and I know 
that Ms. Moore, and I hope she will talk about this, as she 
went into this home, it was one that was full of mold, and if 
you have a respiratory ailment and you are an adult and you go 
into that home, you are triggered almost immediately.
    We have little children in our community who live in these 
homes, and I am all about autonomy and sovereignty for our 
tribal lands, but the Federal taxpayers sent $800,000 to 
remediate what we thought would be 53 homes; we have done less 
than ten. And I think not only does the LCO community, but the 
Congress has a right to know how that money is spent. We have a 
right to see receipts that if it wasn't 53 and it is only 6 or 
8, what went wrong?
    What do we have to do differently, looking forward, to make 
sure that people are cared for.
    And if this is a situation where we don't have enough 
money, your Congress will fight for more money; but if this is 
a problem where money isn't being spent well, we want to make 
sure that our Federal tax dollars are spent effectively before 
we come back and ask for more.
    And so today I want to have a conversation about NAHASDA, 
its future, its past, but I also want to talk about this 
significant issue that we have in our community, that we need 
to partner together, local, tribal, and your Federal 
Government, to resolve this issue. No one should live in a home 
like the one we toured today, not in America. And so with that 
I look forward to the witnesses' testimony.
    Right now, I want to recognize the gentlelady from 
Wisconsin, Ms. Moore, the ranking member of our Financial 
Services Committee's Subcommittee on Monetary Policy and Trade, 
for about a 3-minute opening statement.
    Ms. Moore. Thank you so much, Mr. Chairman, and I want to 
thank the witnesses, some of whom have traveled a great 
distance to make this trek to lovely Wisconsin.
    We are sparing you from the horrible heat wave in other 
parts of the country.
    I want to thank the chairman, Mr. Duffy, for holding this 
hearing and I think it is helpful for us to get outside of D.C. 
from time to time to these field hearings. Of course, I always 
love being home here in Wisconsin, and I'm really happy to be 
here with the LAC Courte Oreilles.
    As Mr. Duffy indicated, we toured a home today that was 
contaminated with black mold and I had to flee that housing. I 
was unable to continue the tour because I am very allergic, and 
I do think it is important to recognize that we are compelled 
to act.
    I have been working on the reauthorization of the Native 
American Housing and Self-Determination Act, also known as 
NAHASDA, since late 2012 and early 2013, and I am happy to 
report that I have had some tremendous partners on both sides 
of the aisle, on a bipartisan basis, and we have passed our 
bill and it has been sitting in the Senate.
    And I thought that we really dealt with a number of issues 
in that bill, up to and including, including all native 
peoples, including Native Hawaiians.
    NAHASDA has been largely a huge success, and to the extent 
that there are any problems like mold, it is largely a function 
of the program needing more resources.
    For example, we have reauthorized $650 million and that is 
a lot of money, but it is only scratching the surface of the 
need. We are here with the LAC Courte Oreilles, for example, 
and Ms. Gokee and I had a sidebar conversation where we knew up 
front in our allocation that you were 50 houses short of what 
would be needed to do a good job. And if the chairman and the 
Majority party are so inclined, I would be absolutely open to 
including more moneys.
    The Sioux tribe actually brought one of their housing units 
to D.C. by semi-trailer truck and put it on the mall so that we 
could see this black mold for ourselves, so thank you for 
bringing us to northern Wisconsin so they wouldn't have to do 
that.
    I want to hear from our witnesses, but I do want to say 
that I am deeply committed to the reauthorization of NAHASDA.
    Again, we have passed a strong bipartisan bill twice and it 
needs some updates and it needs some reforms, but I think the 
bill we have honors self-determination for all Native 
populations, legislation on which I was very pleased to have 
Mr. Duffy's support when it passed in 2015.
    So thank you and I look forward to hearing from our 
witnesses.
    Chairman Duffy. Thank you, Ms. Moore. The Chair now 
recognizes the gentleman from Wisconsin, Mr. Sensenbrenner, 
Chair of the House Judiciary Committee's Subcommittee on Crime, 
Terrorism, Homeland Security, and Investigations, for 3 
minutes. Mr. Chairman?
    Mr. Sensenbrenner. Thank you very much, Chairman Duffy, for 
inviting me up to this hearing to let me know a little bit more 
about how this program is being administered.
    One of the constitutional obligations and duties of the 
Congress is to do oversight and, unfortunately, I don't think 
the Congress does as much oversight as we should to see that 
money is being effectively spent and spent according to the 
purpose for which Congress appropriated the money.
    I guess what I am concerned about here is that we have a 
lot of money that is unobligated, meaning it has been 
appropriated and not spent, and we do not see the mold 
remediation and other problems where this money could 
effectively be spent, and I think that it was important for the 
Congress to know why and to figure out what can be done to use 
this unobligated money to take care of problems like I am sure 
we are going to hear about in a little bit greater detail when 
the witnesses come to speak.
    One of the things that I did during my chairmanship of the 
Judiciary Committee and the Science Committee is spend a lot of 
time on oversight; and we were effective in making agencies 
better, we were effective in having money spent in a more 
effective manner and giving the taxpayers more bang for their 
buck.
    But a lot of whether oversight is done and done effectively 
depends upon the chairman of the committee and the 
subcommittee, and by bringing the subcommittee out of 
Washington and up to northern Wisconsin, where there have been 
problems with how this money has been spent, I think is a way 
for us to find out firsthand, and from the people who have been 
affected by this, what the problem is and what we can do to fix 
it, and for that reason I think that Chairman Duffy has been 
extremely unique in identifying the problems, and starting to 
put a little heat under the agencies: one, to spend the money; 
and two, to spend the money to fix the problems and make sure 
that we don't have any more problems arise.
    So thank you, Chairman Duffy, for having me up here and I 
am looking forward to seeing how we can constructively address 
this problem so as to fix it.
    Chairman Duffy. Thank you, Mr. Chairman. The Chair now 
recognizes and welcomes our witnesses. Our first witness is Ms. 
Heidi Frechette, the Deputy Assistant Secretary for the Office 
of Native American Programs at the U.S. Department of Housing 
and Urban Development, better known as HUD. Ms. Frechette, 
welcome.
    Our second witness is Mr. Tony Walters, executive director 
of the National American Indian Housing Council.
    Third, we have Dr. Harry Malcolm of the Essentia Clinic, 
who was previously a family practice doctor in the U.S Air 
Force and has practiced here in our hometown of Hayward for 
over 20 years. Dr. Malcolm, welcome and thank you for your 
service to our country.
    Our fourth witness, Mr. Mark Montano, is the executive 
director for the LCO Housing Authority. He previously served as 
both vice chairman and director of the tribal operations for 
the Red Cliff Band of Lake Superior Chippewa in Bayfield, 
Wisconsin. Welcome.
    Ms. Rosalie Gokee is our fifth witness and she is a 
governing board member here at the LCO tribe and was with us, 
as many others were, this morning for our tour.
    Our sixth witness, Mr. Floyd Tortalita, is the executive 
director for the Pueblo of Acoma Housing Authority.
    Mr. Tortalita has 17 years of experience in planning, 
design, and housing development projects for the Acoma and 
Laguna Pueblos. He also currently serves as the Region 8 
representative for the Ameren Board of Directors, which 
provides important insurance products to our tribal community.
    And finally, we have our seventh witness, Mr. Jeff Tribble, 
a member of the LCO tribe.
    All of you are welcome. In a moment, you will be recognized 
for 5 minutes to give an oral presentation of your testimony. 
And without objection, all of your written statements will be 
made a part of the record.
    Once the witnesses have finished presenting their 
testimony, each member of the subcommittee will have 5 minutes 
within which to ask questions of our panel.
    With that, Ms. Frechette, you are now recognized for 5 
minutes for your testimony.

   STATEMENT OF HEIDI FRECHETTE, DEPUTY ASSISTANT SECRETARY, 
OFFICE OF NATIVE AMERICAN PROGRAMS, U.S. DEPARTMENT OF HOUSING 
                  AND URBAN DEVELOPMENT (HUD)

    Ms. Frechette. Thank you. [Speaking native language.] Hello 
and thank you. My name is Heidi Frechette, I am the nominee 
from Wisconsin and it's great to be home, especially in the 
summer; and I am also the Deputy Assistant Secretary of Native 
American Programs at HUD.
    I want to say [speaking native language] and thank you to 
Chairman Duffy for the opportunity to discuss American Indian 
housing programs, and to Chairman Louis Taylor for hosting us 
here today.
    I am very honored and humbled to testify with this esteemed 
panel of tribal leaders and tribal housing advocates.
    And as a career SES at HUD, I administer the Federal 
Government's largest national Indian housing programs and work 
closely with tribal leaders, tribally designated housing 
entities, and tribal housing departments, who are doing amazing 
and innovative work in their communities.
    Since I began my tenure in June of 2016, I have visited 
Native communities across the country to discuss the issues and 
challenges tribes face and to hear directly from tribal leaders 
on what HUD can do to strengthen Indian housing programs.
    Like my tribe, far too many Native American communities 
struggle with severely overcrowded housing conditions, 
affordable housing shortages, substandard living conditions, 
and significant barriers to economic opportunity.
    Today, one out of every four Native Americans lives in 
poverty, including one-third of all Native American children. 
Given these grave statistics, HUD's Native American programs 
provide a vital resource to tribal communities.
    These programs include the Indian Community Development 
Block Grant, known as ICDBG; the Indian Housing Loan Guarantee, 
known as Section 184; the Indian Housing Block Grant, known as 
IHBG, which is under NAHASDA; and the Tribal Housing Activities 
Loan Guarantee or the Title VI program.
    HUD's Indian housing programs are successful examples of 
Federal programs that provide local choice, contain streamlined 
governmental requirements, leverage private market investment, 
and respect tribal self-governance.
    In the interest of time, I am going to focus on two of the 
programs: the ICDBG program; and the IHBG program.
    The ICDBG program was authorized in 1977 through an 
amendment to the Housing and Community Development Act of 1974, 
and it's a competitive award that's awarded to American Indian 
tribes and Alaska Native villages under the Community 
Development Block Grant.
    This program funds infrastructure, community buildings, and 
housing rehabilitation for lower-income Native American 
communities. And in FY 2014 and 2015 the program included the 
set-aside of funding for competitive loan remediation and 
prevention grants.
    The IHBG program was authorized by the Native American 
Housing Assistance and Self-Determination Act and provides a 
formula to block grant funding to tribes eligible for 
affordable housing activities.
    Tribes across Wisconsin have used ICDBG funds to support 
their communities, including development of community 
facilities that target support to elders, to at-risk or 
homeless tribal youth, and ensuring the health and safety of 
their communities through water infrastructure projects and 
improvements to things like portable water infrastructure.
    Tribes have made great strides on NAHASDA and the IHBG 
program. The recently published Indian Housing Needs Study thus 
concluded that NAHASDA works.
    Under NAHASDA, tribes have produced more housing units than 
under the previous programs, and they have actually produced 
better housing, housing that is tailored to the local 
community, the customs and the climates.
    NAHASDA supports the government-to-government relationship 
between the Federal Government and tribal governments, and it 
recognizes tribal sovereignty because it provides for 
flexibility and local control, because tribes can decide what 
they need best in their communities.
    NAHASDA funds are often used as seed money to leverage 
funding for new construction and rehabilitation. Last month, I 
had the honor of traveling to New Mexico to the San Felipe 
Pueblo. The tribal housing entity there used their $500,000 
annual Indian Housing Block Grant funding to attract an 
additional $5 million in leveraging funds to construct a whole 
new housing subdivision.
    There are examples like this from tribes across the 
country, tribes that are leveraging the housing dollars and 
utilizing other Federal programs to address their housing 
needs.
    HUD looks forward to working with Congress on 
reauthorization of NAHASDA.
    My written testimony submitted today includes HUD's 
observations on the main elements of H.R. 360, the bill that 
was introduced in the House in 2015.
    So in closing, when considering reauthorization, I always 
am reminded of the fact that HUD's Indian housing programs are 
more than just building homes; they bring hope to many 
communities.
    I recently visited a tribe and was invited into a new home 
of a mother and her four small children, and often on my tribal 
visits I am not invited into homes that are occupied, I see 
vacant units so as not to disturb families, so I was surprised 
that the mother was insistent that we visit her home.
    And when we arrived we were welcomed by the grandmother, 
who was there because the mother was at work, and she was 
accompanied by her eight-year-old granddaughter, who was out of 
school for the summer. And it was so moving to see how happy 
this young girl was that she got to move out of her overcrowded 
home and she insisted on giving me a tour of her new home.
    And she was particularly proud to show me that for the 
first time in her life she had her own bedroom and she didn't 
have to share it with her three little brothers, which she was 
incredibly thrilled about, and I understand where she's coming 
from.
    So as I left I thanked the grandmother because I felt it 
was incredibly generous that they invited us into the home, and 
she hugged me and thanked me for the hope and the opportunities 
that the HUD programs provide. And I was encouraged by the 
difference that the tribes and the tribally-designated housing 
entities were making in the lives of their people.
    So I thank you again for the honor to appear before you 
today and I am happy to answer any questions you may have. 
[Speaking native language.]
    Chairman Duffy. Thank you, Ms. Frechette, and welcome back 
to Wisconsin.
    Ms. Frechette. Thank you.
    [The prepared statement of Ms. Frechette can be found on 
page 41 of the appendix.]
    Chairman Duffy. Mr. Walters, you are now recognized for 5 
minutes.

    STATEMENT OF TONY WALTERS, EXECUTIVE DIRECTOR, NATIONAL 
                AMERICAN INDIAN HOUSING COUNCIL;

    Mr. Walters. Thank you. Good morning. My name is Tony 
Walters, and I am the executive director of the National 
American Indian Housing Council. I am a member of the Cherokee 
Nation of Oklahoma. I have been with the Council for only 3\1/
2\ months, so I am clearly learning some of the services that 
we provide as a nonprofit, advocating on behalf of tribes, as 
well as all of the services and programs designed with our 
Federal partners in D.C., and across the country.
    I would like to thank Chairman Duffy, and Representatives 
Moore and Sensenbrenner for the hearing today and for allowing 
NAIHC to testify.
    Just a little bit more about myself. My grandparents grew 
up on tribal land in Tulsa, Oklahoma. They took advantage of 
HUD and tribal housing opportunities there and moved from a 
small trailer in rural Holler up on top of a hill where they 
had a new home and they recently completed that purchase under 
a lease-to-ownership program over the last 20 years, so I 
know--I grew up a little bit in Indian housing specifically 
that was designed by the Cherokee Nation and for my family and 
for families in our community and now I work and live in D.C., 
advocating on behalf of tribal communities and housing in that 
area.
    NAIHC is a nonprofit, and we serve 250 members, which 
represents almost 500 tribes across the country in their 
housing entities. We do that in two ways. The first is through 
advocacy and partnership with the Federal partners in 
Washington, D.C., whether it is on the Hill or the agencies 
themselves.
    The second way we help our tribal members is through our 
training technical assistance program. We usually provide 
conferences, training programs across the country throughout 
Indian country and regional and specific communities as 
requested.
    So we try to be a great advocate for our tribal members, we 
work well with our partners in Washington, D.C., such as NODAC, 
as well as other programs, the USDA, the Department of the 
Interior, and others.
    We were asked to talk a little bit about NAHASDA. I think 
everyone on the panel here and everyone I have spoken with 
generally says NAHASDA has worked for 20 years.
    When NAHASDA was enacted, tribes took over the ownership 
and maintenance of nearly 70,000 units that they needed to 
maintain, as well as continuing to address the unmet need in 
their communities moving forward.
    In 1996 or 1998, one of the first years of NAHASDA funding, 
it was around $600 million at the time. When you think about 
that, that's roughly just a million per tribe, tribe members, 
there's 567 tribes across the country all in distinct, often 
remote communities, so we think about funding for these 
challenges and meeting the housing needs, tribes really have to 
stretch those dollars and I think they have shown over the 20 
years with NAHASDA that they have really done that.
    Since NAHASDA was enacted tribes have built 34,000 new 
units, while continuing to maintain the 70,000 units that 
existed prior to NAHASDA's enactment. So I think tribes are 
doing a lot with--you could argue sometimes not as much as they 
should get, not as much as the need would justify.
    When you look at funding generally over time, in 1998 or 
1996, $600 million of funding, now in 2016 we are only at $654 
million of funding, so when you count inflation into that 
number, it's about two-thirds of the purchasing power of what 
tribes had in 1996. Still, that represents 567 tribes trying to 
address housing needs in their communities.
    So I think there is a need, there is an unmet need in 
Indian country that NAHASDA can continue to address and does 
address through the IHBG and other programs at HUD and then 
tribes have used, as Ms. Frechette said, NAHASDA money to 
leverage their funds; there are other programs, both Federal 
programs and private programs and lending institutions across 
the country, to really address the housing needs in their 
communities. So I think just generally we can say NAHASDA is 
working.
    The HUD needs assessment that Ms. Frechette mentioned 
highlighted the need even more, actually specifically 
recommending that 68,000 more units were needed to address 
substandard housing and overcrowded homes in Indian country. I 
think the rate for overcrowded homes in Indian country is 6 or 
7 times the national average. I have the numbers in my written 
testimony.
    But when you talk about addressing housing needs, you can 
imagine a lot of these needs in Indian country are compounded 
by the nature of overcrowded homes and having these types of 
homes, kind of the maintenance and upkeep that they require in 
these communities, so with that--and I actually have been 
working with Congress the last few Congresses to reauthorize 
NAHASDA since 2015.
    And the last two comments; I would like to thank the 
leadership of this committee, the Financial Services Committee, 
and others, other allies for passing the NAHASDA 
reauthorization each of the last two Congresses. We have been 
working with the Senate to try to address the issue and concern 
there and will continue to do so. I certainly appreciate H.R. 
360 and for what many of the components of that bill really do 
address and build upon the NAHASDA provisions itself, so we 
look forward to working with you.
    A lot of the specifics are outlined in my written 
testimony. I think the one concern that we do have with H.R. 
360 was the cap on authorization, talked about funding, capping 
that at $650 million without a mechanism to allow for growth 
and funding for these tribal communities is the one concern. 
H.R. 360 is a great bill to start with and I appreciate the 
committee's work and will work with them moving forward to 
address that bill and other ways to address the housing needs 
in the tribal communities. Thank you.
    [The prepared statement of Mr. Walters can be found on page 
77 of the appendix.]
    Chairman Duffy. Thank you, Mr. Walters, and we will talk 
about a nonproductive Senate later in our hearing.
    Mr. Walters. Sure.
    Chairman Duffy. Dr. Malcolm, welcome. You are recognized 
for 5 minutes for an opening statement.

        STATEMENT OF DR. HARRY MALCOLM, ESSENTIA CLINIC

    Dr. Malcolm. Thank you, I appreciate the opportunity to 
speak here.
    I look at my role, if I understand it correctly, to talk 
briefly about what we know about indoor mold exposure and what 
it can do to people's health, and then to talk about what I 
have seen here as a medical provider in the 21 years that I 
have worked in the Hayward, Wisconsin, area and have worked 
with people coming to our hospital and clinics from the tribal 
community.
    Quick background. Before I was here, I was in the Air 
Force, and they paid for medical school, and I am very grateful 
for that. I served active duty for 7 years. The last 4 years I 
was in Okinawa, Japan, which is a hot, humid climate that's 
about the level of the Florida Keys; certainly mold is an issue 
there. I was deemed the island allergist, so I was sent to a 
one-month course at the Wilford Hall Hospital in Texas, and 
then for the last 3 years I was in Okinawa, I did all the 
allergy testing, so I have some background in this. I am not a 
board-certified allergist, I don't want to claim to be that in 
any way, shape or form, but that is my background that I come 
to this with.
    And in the hospital I work in the ER, I work on the floors, 
I work in the clinic, I deliver babies and take care of young 
children. I am the hospice director at certain times, so I take 
care of people at home, at the end of life, so I have a lot of 
exposure in all walks of life over the last 21 years here in 
Hayward.
    Now, what do we know medically about mold, and specifically 
indoor mold exposure? There are a lot of controversies here, 
but there are clear-cut medical problems related to mold that 
we understand.
    The first is infections. Most people, if they are immuno-
competent, which means they have a healthy immune system, they 
are not going to get an infection from mold; but if you are 
immuno-compromised, you can get infection from mold.
    And many, many people are immuno-compromised. You don't 
have to be an AIDS patient to be immuno-compromised; certainly 
they are, but lots of other people are immuno-compromised.
    If you have chronic kidney disease, bad kidneys, the immune 
system doesn't work well. If you are on dialysis, you are 
immuno-compromised. If you have bad liver disease, you are 
immuno-compromised. If you are a cancer patient, even if you 
are cured, your immune system isn't right and you are immuno-
compromised. And certainly if you are a cancer patient and you 
are receiving treatment, you are immuno-compromised. If you are 
a newborn baby, you are immuno-compromised. Your immune system 
really starts to get pretty healthy around 3 months of age, but 
from birth to 3 months of age your immune system isn't very 
good; in fact, your first month of life your immune system is 
really pretty wimpy.
    So there are a lot of people out there who are immuno-
compromised--you don't need to talk about substance issues, but 
if you use alcohol or abuse alcohol, you are immuno-
compromised.
    When you look at the percentage of the population that's 
immuno-compromised, it is a lot, and so in immuno-compromised 
people, infections from indoor mold exposure can occur, be it 
lung infections, be it sinus infections, be it bone infections, 
joint infections, be it sepsis, which can even lead to death, 
so there is a risk to the immuno-compromised population.
    For the people who, again, have a normal immune system, the 
risk of infection is negligible; but if you are immuno-
compromised, there can be issues.
    So the first risk for indoor mold exposure is infections. 
The second risk is hypersensitivity reaction; this is what we 
see a lot of. Probably 20 percent of our population in this 
country has asthma, it may be very mild, it may be just 
exercise-induced asthma, but that is where your lungs are 
extra-reactive to irritant exposures, and mold is certainly one 
of those, so it can flare.
    Asthma can flare allergies, which may sound trivial, but 
there's pretty profound evidence that if you are a teenage kid 
trying to study in school and your asthma is bothering you or 
your allergies are bothering you, it is harder to study, it is 
harder to learn, so there are issues with that.
    And then there are more profound hyper-sensitivity 
reactions. Something called hyper-sensitivity pneumonitis and 
that's where you get a really severe inflammatory process in 
the lungs from exposure to various things, one of which can be 
indoor mold exposure, and it's essential to treat that 
condition so that the mold or whatever the irritant that's 
causing that hyper-sensitivity pneumonitis, that severe 
inflammatory lung process, can be removed and then you need 
long-term steroids to treat that.
    And there are people with hyper-sensitivity pneumonitis 
that even end up needing a lung transplant, so it is not just a 
mild thing that you take some Benadryl for and it goes away; 
this is a serious medical problem.
    There are other medical conditions, and they have long ugly 
names, as doctors tend to approach things, like allergic 
bronchopulmonary aspergillosis, an allergic fungal sinusitis, 
but there are other medical conditions that are clearly related 
to indoor mold exposure. These things are generally accepted in 
the medical community. There are controversies about other 
issues that are controversial--can it cause fatigue, can it 
cause immune issues, that is a controversial area, but there is 
clear-cut knowledge that there are infections that can occur 
and there are hyper-sensitivity reactions that can occur from 
indoor mold exposure.
    And then the last leg of my comment lies with what I see 
here. I have handled a number of patients in the ER and the 
clinics and the hospital who come in with respiratory issues, 
and they tell me that they have substantial mold exposure in 
their home. I see that, I am in the hospital, I treat that, but 
it is clear that I see that at times in Native youth and Native 
adults. I can't say specifically that I have seen a case of 
hyper-sensitivity pneumonitis, the lung transplant, I can't say 
that, but I can actually say with certainty that I have seen a 
number of kids, and a number of adults who come in to see me 
who have been hospitalized, put on hydrous steroids to decrease 
the inflammation, and then try to contact the tribe to see if 
their house can be remediated, in terms of mold exposure, with 
the thought that's probably a trigger.
    That's most of what I had to say. I have the opportunity 
after to entertain any questions. I hope that this is helpful 
to the committee.
    [The prepared statement of Dr. Malcolm can be found on page 
55 of the appendix.]
    Chairman Duffy. Thank you, Dr. Malcolm.
    The Chair now recognizes Mr. Montano for 5 minutes for his 
opening statement.

  STATEMENT OF MARK MONTANO, EXECUTIVE DIRECTOR, LCO HOUSING 
                           AUTHORITY

    Mr. Montano. [Speaking native language.] And good morning, 
Chairman Duffy, committee members, and other Congressional 
leadership. My name is Mark Montano, I am the executive 
director of the Lac Courte Oreilles Housing Authority, and I am 
an enrolled citizen of the Red Cliff Band of Lake Superior 
Chippewa.
    First and foremost, I would like to say it is an honor to 
be invited to provide testimony in regards to the 
reauthorization of the Native American Housing Assistance and 
Self-Determination Act, NAHASDA, which was first passed in 1996 
and last reauthorized some 7 years ago.
    With that said, I am optimistically enthused about the 
possibilities of NAHASDA being reauthorized in the current 
115th Congress.
    At this time I will attempt to summarize my written 
testimony, which has been submitted, within my allocated time.
    The background of the Lac Courte Oreilles Housing 
Authority: Lac Courte Oreilles Housing Authority was 
established in January 1967 and operates as a tribally-
designated housing entity, and by virtue of such, we have to 
adhere to all rules and requirements of the program.
    From approximately 1969 to currently, the Housing Authority 
has constructed a total of 554 homes, of which approximately 
160 homes were built utilizing the discontinued Mutual Help 
Program, which assisted families to become homeowners, of which 
today all but three of those homes have been conveyed to those 
families.
    The Housing Authority receives NAHASDA formula funding for 
343 homes, which leaves a shortfall of 54 homes that have been 
built with no annual appropriations to operate and maintain.
    This shortfall means that the Lac Courte Oreilles Housing 
Authority has had to utilize its NAHASDA formula funding to 
operate and maintain all of its housing stock, thus creating a 
further shortage of adequate funding.
    Over the past 20 years the Lac Courte Oreilles Housing 
Authority has made great strides with leveraging its NAHASDA 
dollars so address housing issues and, in fact, has been very 
successful in utilizing the low-income housing tax credit 
program with the IRS. The following projects were a direct 
result of those low-income housing tax credit efforts: LCO-1 
consisted of the rehabilitation of 24 existing homes scattered 
throughout the reservation: LCO-2 consisted of the construction 
of 24 new rent-to-own homes in a newly-constructed subdivision, 
which included all the infrastructure needed to support the 
development; and LCO-3, which was just recently completed in 
approximately 2014, consisted of the rehabilitation of 24 
existing homes in the K-Town and Schoolhouse areas.
    There's still much work that needs to be done and, in fact, 
the LCO is no different than other tribal communities, which 
leads me to the next subject matter, the condition of housing 
in Indian country.
    Numerous reports have been written and provided to Congress 
in regards to the deplorable conditions of housing in Indian 
country and the challenges that have been faced by tribes to 
address this issue.
    Some of those reports, which I am sure you are aware of, 
include the following, and I am certain there are others: In 
July of 2003 the U.S. Commission on Civil Rights provided a 
report entitled, ``A Quiet Crisis, Federal Funding and Unmet 
Needs in Indian Country.'' And in January of this year HUD 
issued a report entitled, ``Housing Needs of American Indians 
and Alaska Natives in Tribal Areas: A Report From the 
Assessment of American Indian, Alaska Native, and Native 
Hawaiian Housing Needs.''
    I would encourage you, if you have not already, to review 
the contents of those reports, which continuously report the 
issues faced in Indian country regarding housing, but more 
importantly, the inequities with funding levels.
    My comments regarding H.R. 360 are contained in my written 
testimony, but I would like to reiterate a few of the important 
areas.
    We would ask that the tribes be allowed to increase their 
formula for current assisted stock to the true number of 
housing stock they own and operate as low-income housing rental 
units; as previously stated, we are underfunded, we are not 
receiving the full funding that we need to take care of all of 
the homes under our control.
    We also encourage Congress to ask HUD to provide a report 
that would accurately state the real operation and maintenance 
costs, so that a starting point for appropriations could be 
identified.
    In addition, we would ask that language be included in the 
bill that would allow for inflationary and fixed-cost increases 
over the authorization time period.
    We at this time would like to offer some other 
recommendations to the committee. First, provide direct 
allocations from the IRS of the low-income housing tax credits, 
instead of tribes having to go through the State for 
competitive applications.
    Second, the tribes should be able to have full access to 
all HUD programs and services similar to States, public housing 
agencies, and other entities.
    Third, tribes, as well as other communities, are faced with 
a very, very serious methamphetamine epidemic and there needs 
to be Federal intervention. This issue is costing the LCO 
Housing Authority well in excess of $100,000 annually for 
clean-up and testing.
    Currently, the State of Wisconsin has no regulations in 
regards to this, including clean-up standards, so the people of 
Wisconsin are going into homes not knowing the history, and 
potentially becoming contaminated by this drug.
    In closing, I applaud the chairman for scheduling this 
hearing, and other Congressional leadership for attending, but 
I would also encourage this committee and other committees of 
the 115th Congress to have more hearings throughout Indian 
country.
    We certainly have many more suggestions that would improve 
the housing conditions and the ability to deliver services; 
however, the information I have provided orally today and in my 
written testimony is the starting point to addressing the 
issues we face.
    In addition, I firmly believe that we can collectively 
address the needs of Indian country by being proactive and not 
by kicking the can down the road or closing our eyes to a 
crisis that exists; but more importantly, not blaming each 
other, and agreeing to cooperatively work to improve the lives 
of the first Americans of this land.
    Tribes have been the invisible people for far too long, and 
if anything should come out of this hearing, it is due time 
that the reports are done being written to Congress and a 
resolution is found to address this one important issue once 
and for all.
    I personally stand ready to assist my Native brothers and 
sisters in any way possible and also commit to assisting 
Congress with this endeavor. [Speaking native language.]
    [The prepared statement of Mr. Montano can be found on page 
58 of the appendix.]
    Chairman Duffy. Ms. Gokee, you are recognized for 5 
minutes.

STATEMENT OF ROSALIE GOKEE, GOVERNING BOARD MEMBER, LAC COURTE 
                         OREILLES TRIBE

    Ms. Gokee. First of all, I would like to say good morning 
to everyone, all of you who have traveled here to hear the 
concerns regarding housing, Chairman Duffy for organizing this 
meeting here today, and also a special recognition to 
Representative Moore for taking the time to listen to our needs 
here by listening to me this morning and honoring the 
government-to-government relationship that exists. Thank you 
for doing that.
    The Lac Courte Oreilles Reservation was established by the 
1854 Treaty with the Chippewa. Currently, the tribe is composed 
of approximately 8,000 tribal members, of which 2,425 reside 
within the reservation boundaries.
    The tribe operates as a Native housing entity which has a 
director and a housing board of commissioners that act in an 
advisory capacity. The mission of the Lac Courte Oreilles 
Housing Authority is to shelter and protect their people and 
help their community prosper.
    As a TDAG tribal-designated housing entity, it gives HUD 
the authority to fund our housing authority directly, those 
funds do not come to the tribe; I think it's important to know 
that.
    I would like to talk a little bit about the treaty and 
trust responsibility for adequate housing. The tribe's treaty 
reserved inherent rights include the right for adequate 
housing.
    In the Treaty of 1854 the Federal Government established 
the Lac Courte Oreilles Indian Reservation and induced the 
various bands to forego their existing homes in the seated 
territories by the promise of assistance in building new homes 
on the reservation. Despite the pivotal role of housing 
promises in the negotiation for the 1854 Treaty, many Ojibwe 
people have lived in substandard housing since the 
establishment of the reservation.
    Safe, decent, and adequate housing in the form of funds for 
building, repairs, and renovations, and related infrastructure 
is a treaty right and forms part of the Federal trust and 
fiduciary responsibility of the Federal Government as 
established in its treaties.
    As Congress continues to address the ongoing housing crisis 
experienced by many tribes, policymakers must consider the 
complete history of the Federal Indian housing obligation in 
making its decisions.
    It is concerning to me that many tribal members continue to 
live in unhealthy and substandard housing for Lac Courte 
Oreilles, conditions which are a direct result of inadequate 
funding from the Federal Government to adequately address the 
housing needs in our tribal communities.
    And I have to agree with you, Congressman Duffy, no one 
deserves to live in the conditions we saw today, no one. The 
real issue here is lack of funding to meet the housing needs of 
our members, so they no longer need to live in these 
conditions.
    I agree with our housing director, Mark Montano, that more 
housing needs to happen. This issue just isn't here at Lac 
Courte Oreilles, but all across Indian country.
    As a tribal leader, quite frankly, I feel that tribal 
members deserve better. Funding from the housing program 
fulfills Congressional trust and treaty responsibilities to 
tribal nations.
    I strongly urge this committee to advocate for the 
reauthorization of NAHASDA that will benefit all tribal 
nations. [Speaking native language.] Thank you for your time.
    [The prepared statement of Ms. Gokee can be found on page 
48 of the appendix.]
    Chairman Duffy. Thank you, Ms. Gokee. The Chair now 
recognizes Mr. Tortalita for 5 minutes.

  STATEMENT OF FLOYD TORTALITA, EXECUTIVE DIRECTOR, PUEBLO OF 
                    ACOMA HOUSING AUTHORITY

    Mr. Tortalita. [Speaking native language.] Good morning, my 
name is Floyd Tortalita, and I am from Pueblo of Acoma in New 
Mexico. Thank you for the invitation to come before the 
subcommittee, in this wonderful country here.
    Good morning, members of the Subcommittee on Housing and 
Insurance, and thank you for inviting me to testify on the 
Federal housing programs that impact families in Native 
American communities and reservations. I am the executive 
director of the Pueblo of Acoma Housing Authority (PAHA). PAHA 
serves as the Tribally-Designated Housing Entity (TDHE) of the 
Pueblo of Acoma.
    Under the Native American Housing Assistance and Self-
Determination Act of 1996, as amended, tribes can designate 
TDHEs to receive and administer Indian Housing Block Grant 
funds under NAHASDA.
    There are 22 tribes in New Mexico: 19 Pueblos; the Navajo 
Nation; the Mescalero Apache; and the Jicarilla Apache. The 
majority of our lands and all of our housing developments are 
on tribal trust lands. This means that the Federal Government 
holds legal title to our lands for the benefit of each of our 
tribes.
    As you might guess, development on tribal trust lands looks 
somewhat different than development on private lands. If you 
are in New Mexico and you are wondering why there are no 
stores, fast food places, or banks in certain areas, it's 
because you are probably on the reservation.
    I would like to start my testimony by highlighting the 
impact that Federal housing programs have had on Indian lands 
with a quote from the Housing Needs Study published in January 
2017: ``The most important driver of economic well-being in any 
area is the state of the local economy.'' But many of these 
programs, including NAHASDA, ICDBG, BIA, USDA, VA loans, and 
IHS help many tribes develop the capabilities of sustained 
development of their own economies.
    The Pueblo Acoma is currently the largest employer in 
Cibola County. How much of that money stays within our 
community: very little. With these programs and use of NAHASDA, 
it brings tribal members back to develop economies.
    To develop these economies for us to become self-
sustaining, we turn dollar over dollars to start making these 
dollars available. Tribes rely heavily on Federal funding to 
meet the housing need for development, developing these housing 
needs.
    The United States has a Federal trust responsibility to 
protect the interests of its 567 federally-recognized tribes, 
including our interest in providing tribal members with access 
to shelter and security through affordable, safe housing 
opportunities.
    NAHASDA was enacted in 1987 and reauthorized in 2008 to 
help fulfill the goal and address the housing crisis plaguing 
many Native communities.
    NAHASDA reauthorization has failed the past two 
Congressional sessions, despite widespread support, due to the 
inability to bring the bill to the Floor vote in the Senate. 
Consequently, housing-related issues such as overcrowding, 
homelessness, and incomplete plumbing and kitchen facilities, 
all have associated negative health outcomes, and continue to 
impact the quality of life of countless Native American 
families and communities.
    We would like to make the following recommendations for the 
subcommittee and Congress to consider in making NAHASDA more 
workable for tribes going forward:
    First, remove barriers to building on floodplains by 
allowing the use of NAHASDA funds on floodplains without 
requiring a tribe to be a member of the National Flood 
Insurance Program (NFIP). NAHASDA should have language 
providing that if a tribe has a tribal flood management program 
or law, that the law should be applied in lieu of complying 
with the Federal Floodplain Act, which requires a Federal 
funding recipient to be a NFIP participant. Some State funding, 
including Community Development Block Grant funds and HOME 
funds, are exempt from this requirement. Tribes should have a 
similar exemption.
    Second, allow tribes to access other HUD programs, such as 
the Drug Elimination Program and Section 8 Program. NAHASDA 
combined many HUD programs into one Federal funding source 
without increasing funding; as a result, tribes can't access 
programs they once had prior access to.
    Third, authorize the Department of Justice to go into 
tribal court for foreclosures and evictions of the 184 program. 
Currently, tribes are not allowed, if they are still pending on 
the reauthorization of the 184 program, HUD is now saying that 
we must adhere compliance to jurisdiction of Federal court and 
not tribal court. We think that should be in tribal court.
    Fourth, incorporate similar provisions as those set forth 
in former H.R. 360, introduced by Congressman Steve Pearce 
during the 114th Congress.
    PAHA and the 19 Pueblos in New Mexico would like to support 
the reauthorization of bills like former H.R. 360, introduced 
by Congressman Pearce, and its Senate companion bill S.710, 
introduced by Senator John Barrasso. Congressman Pearce worked 
closely with New Mexico tribes in introducing 360. Importantly, 
360 included language that would have expedited required 
Federal approvals, authorized tribes to blend IHBG funds with 
IHS sanitation facilities funding and launch, a demonstration 
program for alternative critical provisions within NAHASDA. 
They would provide tribes with the flexibility to effectively 
respond to the unique housings of the communities. We recommend 
that similar provisions be included in any future NAHASDA 
reauthorization.
    [The prepared statement of Mr. Tortalita can be found on 
page 64 of the appendix.]
    Chairman Duffy. Mr. Tortalita, thank you for your 
testimony. Mr. Tribble, you are now recognized for 5 minutes 
for an oral statement.

  STATEMENT OF JOHN TRIBBLE, MEMBER, LAC COURTE OREILLES TRIBE

    Mr. Tribble. Hello, my name is John Tribble, and I am a 
member here of LCO. I have been involved in housing issues for 
over 12 years. I have talked with many people who have concerns 
about the way housing has been handling these issues, 
especially with the mold issues inside their homes. There has 
been mold growth in my home, as well as the homes of everybody 
that I have talked to in my community.
    There have been many attempts by individuals to address 
this health issue that does not have a satisfactory solution 
for housing.
    There have been questions on how housing and how the former 
members now of the Tribal Governing Board have been spending 
the funds that are given to provide homes for any and all 
projects. I have questioned numerous people and I cannot obtain 
information on why we are not receiving any remedies or the 
funding needed to address the housing issues, especially the 
mold.
    Some people who have been involved in determining projects 
before have come forth and said that there has been 
misappropriations, misspending of those fundings, misallocating 
and mismanagement, and that they have evidence of this 
mismanagement; however, under nondisclosure agreements they are 
unable to testify to that fact unless subpoenaed or requested 
to testify before the review committee.
    I spoke with a lot of people who live in these homes, I 
asked about their health concerns, and everybody I have talked 
to all has the same health concerns and issues, such as asthma 
developing in their young children, and there's no history of 
asthma in their family; the mother and grandfather's never had 
asthma, but now their children do.
    We have had elders who have been rushed to emergency rooms 
for respiratory illnesses. This is quite common, but not 
recognized because nobody speaks about it.
    Now, I understand Federal funding is always an issue with a 
lot of programs, but one of our concerns is, as Congressman 
Duffy has addressed before, how are these dollars being spent? 
Well, we believe that they are not being properly spent, 
especially to address these issues.
    There has been mold in these homes for many, many years. 
There have been previous projects in the past, even before Mr. 
Montano became director, and yet the mold issue has grown 
substantially instead of decreased.
    As you have seen in the house that you inspected this 
morning, I assure you there are many, many more just as bad, if 
not worse.
    I represented a group of people who started a petition 
because we were concerned about the spending of those dollars 
and why are these issues still a big concern for the 
communities. It's not just here at LCO, I have spoken with 
other tribal members and other members of executive boards 
overseeing their housing committees and they all have the same 
issues.
    We would like to see that the committee and HUD administer 
some kind of accountability, such as when you send money to a 
tribe for a big project such as this and the seriousness of 
this issue, especially with the mold and health concerns, even 
the doctor said it could even lead to death, which has been 
proven.
    I believe that there should be some kind of field 
administrators or inspectors to go and view these projects, and 
make sure that the money is being spent correctly, especially 
with the mold. This is a really big thing, it's still new yet, 
as far as the medical field, but the doctor said there are a 
lot of issues. And this is one of our big concerns is about how 
are these dollars being spent, are they being spent and 
administered correctly? We would like to see this committee and 
HUD form some kind of accountability, some kind of 
administration to oversee the spending of these dollars.
    [The prepared statement of Mr. Tribble can be found on page 
76 of the appendix.]
    Chairman Duffy. Mr. Tribble, thank you for your testimony 
and for leading the effort to bring this to my attention. I 
appreciate that.
    The Chair now recognizes himself for 5 minutes for 
questions.
    I do want to thank Chairman Taylor, newly-elected, for 
opening this facility up today and allowing us in, and I 
congratulate him on his election. I know we have many tribal 
board members here today and I welcome them and thank them for 
their participation as well, including Ms. Gokee, who is here 
testifying.
    I want to start off with Dr. Malcolm; I know he has taken 
time between rounds and clinical, I think would be the proper 
terminology, to come and testify for us, but he probably can't 
be here for the full hearing.
    So to you first, Dr. Malcolm, we went to a house today 
where we were looking at 2 to 3 feet of black mold at the base 
of a bedroom; the window sills of this bedroom full of black 
mold; another bedroom right next to it, I didn't even think it 
was being used, it was full of black mold; the bathroom, spots 
of black mold everywhere. And in this home we had a mother, we 
had a very young child, a little over a year old, we had two 
young ladies and a beautiful little chihuahua, Taco, which we 
met today.
    What impact does that environment have on these kids? Can 
you tell us, with your medical profession, that kids can be 
raised in a healthy environment living in a home with 
conditions such as this?
    Dr. Malcolm. There is a high risk that those children will 
have problems, that they are going to have allergic problems, 
they are going to have asthma problems.
    As people commented earlier, some people are genetically 
prone to asthma, but we also realize that sometimes it's just 
your exposure, and mold is clearly--if you look at the triggers 
of asthma, there's dust mites, there's various pollens of 
trees, weeds, and grasses, but also mold is a big trigger of 
that, and that can also then lead to chronic life-long lung 
problems, so those children growing up in that environment are 
at health risk going forward.
    Chairman Duffy. So your point is, this is not consequence 
free?
    Dr. Malcolm. No.
    Chairman Duffy. Having children and families live in this 
environment has short-term and potentially long-term 
implications on the health of those living in these homes; is 
that fair to say?
    Dr. Malcolm. Absolutely.
    Chairman Duffy. Okay. Mr. Tribble, you've expressed your 
concern about mismanagement of funds and you rallied 100-plus 
people to try to have this issue addressed.
    If money comes from the Federal Government in the form of 
grant money to remediate mold on the reservation, if that's 
what happens and that money is mismanaged, who does it hurt?
    Mr. Tribble. It hurts the community, especially our 
children.
    Chairman Duffy. It hurts the community and the children 
that it was meant to help, right?
    Mr. Tribble. Yes.
    Chairman Duffy. This money was supposed to go to help, I 
believe, 53 homes; 53 homes were in the grant. And I will ask 
Mr. Montano in a second. Do you know how many homes have been 
remediated?
    Mr. Tribble. Less than ten.
    Chairman Duffy. Now, I have asked for documentation from 
the tribe to lay it out in regard to this $800,000, but I 
haven't been given anything. But you are a tribal member, 
right?
    Mr. Tribble. Yes.
    Chairman Duffy. Have you asked for transparency?
    Mr. Tribble. Of course, we have.
    Chairman Duffy. Have you received it?
    Mr. Tribble. No.
    Chairman Duffy. And I want to be clear, this is not the new 
tribal government, this was the old tribal government, and it 
was to them that you asked for transparency.
    Mr. Tribble. That's correct.
    Chairman Duffy. So to the whole panel, is it fair to say 
that there is agreement that you need more money to fix your 
housing problems?
    Mr. Tribble. Yes.
    Chairman Duffy. Everyone is shaking their head. Is that a 
``yes?'' [Numerous people responded, ``Yes.'']
    Chairman Duffy. And do you all know where the money comes 
from? It's a stupid question. It comes from the Congress, 
right? We are the ones who appropriate money to these programs. 
So if the Congress asks for documentation about a grant and a 
tribe doesn't give the Congress that information, does it just 
hurt that tribe or does it hurt all of our tribes? Mr. 
Tortalita?
    Mr. Tortalita. All of those recipients do suffer. 
Unfortunately, being on the board for NAIC for 6 years, I have 
visited many tribes within that time and some of those tribes 
have those issues.
    It does create issues for all tribes because those are the 
ones that stick out, but many tribes are successful.
    And I can sit here and talk about my tribe for one.
    When I took over as the executive director of the housing 
authority in 2009, we had 22 findings in our audit, and we had 
16 findings in our HUD review. In 3 years, I turned that around 
to where we had no findings, zero.
    Chairman Duffy. A success story.
    Mr. Tortalita. A success story.
    Chairman Duffy. And I don't know if it was Ms. Frechette or 
Mr. Walters who mentioned the $500,000 grant that was turned 
into $5 million.
    Ms. Frechette. Yes.
    Chairman Duffy. A success story.
    Mr. Tortalita. Yes.
    Chairman Duffy. But when we have scenarios where money is 
mismanaged and there's a lack of transparency, that doesn't 
just affect that one tribe, it affects all the tribes, because 
when Ms. Moore and I go back to Washington and we say, we care 
about the money that goes to help Indian housing, to help our 
tribes, and we have to verify that this money has been spent 
well, and we can then fight for more money. But if we can't 
advocate and say, this money has been spent in an appropriate 
fashion, how do I ask for more?
    We have a $20 trillion debt, that's in the back of people's 
minds, and so I am going to say, every dollar that we sent you 
have used to its best ability, to help the most people; and 
when we asked, you were transparent and you just need more.
    If Ms. Moore and Mr. Sensenbrenner wouldn't mind, if I 
could just go for a couple of minutes, and I will then say 
thank you.
    Mr. Montano, you sent the grant in to HUD and you asked for 
$800,000 to remediate 53 homes; is that right?
    Mr. Montano. First and foremost--
    Chairman Duffy. Is that correct?
    Mr. Montano. First and foremost--
    Chairman Duffy. Is that correct?
    Mr. Montano. Congressman Duffy--
    Chairman Duffy. Were there 53--did you make a request for 
$800,000 to remediate 53 homes?
    Mr. Montano. No, I did not.
    Chairman Duffy. So did the tribe make that request?
    Mr. Montano. Yes, they did.
    Chairman Duffy. So we can play semantics and say you did, 
but, okay, the tribe made that request?
    Mr. Montano. Correct.
    Chairman Duffy. And now as the director, how many--this was 
done almost 2 years ago, the money was received?
    Mr. Montano. The grant was awarded in September of 2015.
    Chairman Duffy. So we are almost 2 years on. How many homes 
have been remediated?
    Mr. Montano. Ten homes have been remediated. We are on 
phase three with an additional six homes being worked on.
    Chairman Duffy. Six additional homes.
    Mr. Montano. Yes.
    Chairman Duffy. Do you recall, in our conversation in 
Washington, that you told me that you'd only be able to do 
eight homes with that money? And then you don't remember--well, 
you do remember, what has changed; how are you able to double 
the number of homes you were going to remediate at that point, 
since our conversation?
    Mr. Montano. I do not recall that conversation.
    Chairman Duffy. So it has always been 16 homes you were 
going to be able to do with the $800,000 grant?
    Mr. Montano. I think that's a misrepresentation of the 
facts, Mr. Duffy.
    Chairman Duffy. Okay, well, is it fair to say you indicated 
that you were going to do--that the tribe was going to do 53 
homes, that was the grant?
    Mr. Montano. That's correct.
    Chairman Duffy. And with that specific money, the $800,000 
from HUD and the $300,000 that LCO was going to put in, how 
many homes are you going to be able to do?
    Mr. Montano. Adding the two together, $1.2 million.
    Chairman Duffy. Correct.
    Mr. Montano. I am not prepared to answer that question, 
really.
    Chairman Duffy. We are 2 years on. I thought you just told 
me it was 16 homes. We are 2 years into getting this money, as 
Mr. Tribble has pointed out, and you can't tell me how many 
homes are going to be remediated with the $1.1-, $1.2 million?
    Mr. Montano. Congressman Duffy, as the ICDBG grants were 
awarded out, you have to take the whole project and divide the 
$800,000 by the number of homes. So at this current time we are 
at 16 homes that the $800,000 is infusing money into.
    The housing authority has been utilizing its IHBG dollars 
and other program revenue to support the construction and this 
$800,000 is a small portion of the amount that was used for 
construction.
    Chairman Duffy. I am asking you specifically about the 
$800,000, I am not talking about any other money, so--
    Mr. Montano. That is how the program works.
    Chairman Duffy. So you can't delineate that $800,000--
    Mr. Montano. That $800,000 would be divided by the number 
of total homes done with the project.
    Chairman Duffy. And how many total homes will be done?
    Mr. Montano. We are at the point where we are looking at 
about 20 to 21 homes.
    Chairman Duffy. So it has gone from 8 to now 21 homes. I 
will come back and ask some more questions, but my time is way 
over.
    I now recognize the gentlelady from Wisconsin, from the 
Milwaukee area, Ms. Moore, for 5 minutes.
    Ms. Moore. Thank you so much, Mr. Chairman, and I thank our 
witnesses; I have learned a great deal sitting here today.
    I want to perhaps continue with this line of questioning 
with Ms. Gokee, Mr. Montano, and Mr. Tortalita, just jump in 
anywhere you can fit in, as we say.
    It is really eerie, Mr. Chairman, that you have harked on 
this 53 houses because that just happens to be almost exactly 
the number of houses that reappropriating NAHASDA--less than 
what they need.
    And by the way, the funds we are talking about today are 
not NAHASDA funds, they are special funds, but it is just eerie 
almost that we are talking about 53 houses and that is the 
exact amount of money that they have to use whatever funds they 
get to sort of spread over the entire stock to maintain them. 
Is that correct, Mr. Montano?
    Mr. Montano. Yes.
    Ms. Moore. Okay. Now, back to the expenditure on these 
houses. One of the things that I know, from being a homeowner 
and being someone, Dr. Malcolm, who is very asthmatic, is I 
don't see how these people can spend 5 minutes in the house, is 
that you don't know when you are putting together a prospective 
scope of work how much the houses are going to cost until you 
actually tear the walls down.
    So if I am making a proposal for moneys and say, this is 
what it is going to cost, I don't know whether I am going to 
get a little gallon of bleach and some Kilz and that is going 
to remediate the situation, or if I am going to have to strip 
it down to the studs; or worst-case scenario, spend $1,500 to 
replace each stud. Is that correct, Mr. Montano; did you find 
any surprises?
    Mr. Montano. You are on point, that is true.
    Ms. Moore. I used to be a housing--before I became a 
Congresswoman, I had a real job.
    I also wanted to--Mr. Tortalita, you traveled a great deal 
and so I guess I want to talk a little bit about how difficult 
it is to negotiate these funds that don't seem to have any 
nexus.
    For example, you talked about sanitation and funds that are 
restricted for one use and can't be used for other purposes, 
and not being able to access the low-income housing tax 
credits, as are other sovereign bodies like cities and States.
    So what extent do you think that Justice Department issues, 
to what extent do you think the mismatch of law and the lack of 
respect for sovereignty contributes to not being able to get a 
very cost-effective project? And before I yield to you to 
answer, I am also thinking about the fact that it might be more 
cost-effective just to tear the house down, but if you do that, 
you sort of shoot yourself in the foot because you then will 
diminish the amount of NAHASDA funds to which you are eligible.
    Can you just share with us the conundrum of trying to do 
these projects?
    Mr. Tortalita. Thank you, Congresswoman Moore. I think a 
lot of times it is a lot of the red tape within the Federal 
Government itself. Many of the programs, many of the 
Departments that do not communicate with one another create a 
huge barrier, whether it be dealing with USDA, the VA, IHS, 
HUD.
    We will take the environmentalists, for example, which 
creates a huge hindrance. You do environmental assessments all 
under compliance with NEPA, but yet IHS will not accept an 
environmental done under HUD requirements, which will not be 
accepted under USDA, which will not be accepted under other 
programs, but yet we all comply to the Federal Government, so 
that--
    Ms. Moore. And that adds to the cost.
    Mr. Tortalita. --adds to the cost.
    We just recently did a project where we were not required 
to do an EA on it, but because we needed a Federal land lease 
on it, the BIA required us to do an EA to put their thumbprint 
on it, which cost us an extra $24,000 just to put their 
thumbprint on it and recognize their lease.
    So a lot of these issues between many of the Federal 
entities create issues, so there needs to be--many of these 
need to become standardized, are those issues that are there 
and what requirements that many of these programs that are 
there. But as I mentioned, there are many, many successful 
programs that we--through which is required.
    Under NAHASDA we recently completed 67 units of 
rehabilitation. We had mentioned the cost of new construction 
and rehabilitation. The average cost of construction at Acoma 
is $250,000 for a new home. We have renovated homes at 
approximately $65,000 per unit, bringing traditional homes to 
code, many of which we thought didn't have a hope of doing it, 
but addressing all of these homes--about $65,000, 67 units 
addressed. We have spent approximately $4.3 million in direct 
construction in the last 5 years, since 2012, which is about 
$6.3 million of our overall NAHASDA grant, through 
administration of current units that we have, but this was 
direct construction that we had to 65 families.
    We had one individual, and I love this story, I could go on 
and on about the stories that we get with these families 
because many of them are low-income families, elderly families 
or families with disabilities.
    We recently assisted a 90-year-old woman, a widowed woman, 
in remodeling her home, so--
    Ms. Moore. So do you do this with some of your tribal 
funds--
    Mr. Tortalita. Yes.
    Ms. Moore. --gaming funds?
    Mr. Tortalita. No, we don't. We are one of those tribes 
that have a gaming source, but it's not very much. We are--
    Ms. Moore. Do most tribes have gaming revenues enough to be 
able to do what you--
    Mr. Tortalita. No, no, we don't.
    Ms. Moore. So--
    Mr. Tortalita. No, we don't. We don't get enough revenue 
from our gaming enterprises to be able to assist individual 
families or into--it goes into larger part systems: 
infrastructure; tribal administration. We don't get the large, 
large game dollars like some other tribes do, depending on 
location.
    But this individual, in her comments she cried when she 
walked into her new home. This was a traditional home built 
with rock, had a wood-burning stove, hand-made cabinets, but we 
put in a whole new up-to-date ceramic tile floor, a new 
kitchen; she cried. And for lack of a--in her words that she 
said in Acoma, she said, I have a home like people on the 
outside.
    Ms. Moore. I do want to give Ms. Gokee and Mr. Montano an 
opportunity and maybe Mr. Tribble an opportunity to say 
something, too, so thank you so much for that.
    And Ms. Gokee, Mr. Montano, anything to add to the costs 
and what you have inherited, what you have found?
    Ms. Gokee. Yes. When this grant was applied for, it did 
indicate 53 homes, that is the truth, but when work started and 
it was discovered the extent of the mold, those numbers needed 
to change.
    Mr. Montano, our housing director, submitted a report to 
HUD showing that change to 23 homes; that was approved by HUD. 
They did not want to take a Band-Aid approach on these homes, 
we wanted to fix them because we believe our tribal members 
deserve better.
    Ms. Moore. Well, they deserve better, but also HUD has very 
strict guidelines, so if they say you have to cut the grass in 
addition to getting rid of the mold, I know how they are with 
the strict code upgrades that you might not do except that 
these are their guidelines. Did you find yourself in that 
situation as well, Mr. Montano?
    Mr. Montano. The mold remediation grant has several 
components to it. The first and probably most important part of 
the mold remediation grant was that we were required to 
remediate and perform construction practices and install 
materials to prevent it from re-occurring again. In other 
words, they wanted it taken care of once and for all.
    The second component of that particular grant is education. 
We were required to provide tenants in the general public 
education about mold--the effects of mold, the issues that 
cause mold to grow, the general housekeeping conditions that 
potentially could cause mold to grow, and things that tenants 
could do to help prevent it from re-occurring after we do the 
remediation.
    Ms. Moore. And you have to spend money out of the grant for 
that?
    Mr. Montano. Correct. So as Councilwoman Gokee had 
mentioned, once we began exposing the homes, the issue was far 
worse than we had expected.
    As a matter of fact, one of the homes that we had worked on 
under this project had received prior ICDBG funding to 
remediate mold, and it was not done correctly because they had 
a cost cap and they could only spend so much money on the home 
so, therefore, they tried to do the best that they possibly 
could and correct the issue. That home we had to deconstruct 
down to the studs and it had severe mold issues.
    Ms. Moore. Thank you. My time is waning. I just wanted Mr. 
Tribble to weigh in and tell you that I think you are very 
brave, as a person who represents folks who are frustrated. I 
know I have asthma and hay fever, it is in my family, and it 
would be untenable for me to live in these homes. I want to 
thank you for your service and I do--I can appreciate your 
frustration.
    I also was wondering if there were any discussions, among 
the hundreds of people, about the absolute lack of adequate 
resources to do them all. I know there are great expectations, 
but I just want you to know that the Federal Government has not 
been as generous as you might believe.
    In our current budget, for example, the Indian Housing 
Block Grant has been zeroed out. Unfortunately, in the last 
couple of days the Appropriations Committee has sort of flat-
funded. And as you heard testimony here today, the level of 
funding that we have provided is equivalent to what the money 
was worth back in 1996, and so I just wanted you to know that 
we are going to work really, really hard, and I know that while 
there may have been suggestions with your fraud or your abuse, 
there is also a lack of funding that is coming from the Federal 
Government as well, and I just wanted to--
    Mr. Tribble. Thank you. I am aware of a lack of funding. I 
have been doing this kind of work for quite a few years, I am 
an advocate for the people, advocate for the rights of the 
people.
    Our concern--we are well aware of the dollars that we were 
supposed to receive for these projects, not only for housing 
but for other projects.
    Ms. Moore. Health, yes.
    Mr. Tribble. Health, schooling. Our biggest concern is, how 
are these funds being managed? If they were properly managed, 
maybe we wouldn't be in such a dark hole, maybe we wouldn't be 
this far in the health concerns, maybe we wouldn't be this far 
in the mold.
    Like I said, there have been people who came forward to me; 
I have been extensively investigating and talking with numerous 
people, key people who were part of the finance projects, who 
say and claim that these funds were misappropriated.
    So our concern is that this cannot happen, this should not 
be allowed to happen. There has to be a precedent set, an 
example set that this should not be tolerated by Congress, by 
the people who are providing these funds.
    Ms. Moore. So you should run for the council. Whoops.
    Mr. Tribble. Well, that's--
    Ms. Moore. I am leaving soon so I can get away with that.
    Thank you, I think my time has expired.
    Chairman Duffy. The gentlelady yields back to the Chair. 
The Chair recognizes the other gentleman from Wisconsin, Mr. 
Sensenbrenner, for 5 minutes.
    Mr. Sensenbrenner. Thank you very much, Chairman Duffy.
    There is a government accountability law, it is a GAO 
report, that the tribes cumulatively had $1 billion from 
unexpended NAHBG funds in July of 2013. Ms. Frechette, what are 
the current levels of unexpended funds?
    Ms. Frechette. The current level is 95 percent expended.
    Mr. Sensenbrenner. I'm sorry, I can't hear you.
    Ms. Frechette. The current level is 95 percent expended 
IHB--
    Mr. Sensenbrenner. I am talking about dollars. You are 
doing apples and oranges here. You said a billion dollars in 
2013. How many dollars now?
    Ms. Frechette. I will have to check on the dollar amount 
and get back to you.
    Mr. Sensenbrenner. Okay. So, you don't know.
    Now, obviously, there's a lack of funds that are flowing 
down to get the job done here. I think that Congress has been 
adequate in providing funds, it is just that there is a billion 
dollars a few years ago that has been squirreled away someplace 
where it hasn't been used.
    That's a problem, and it is a problem for the three of us 
and our colleagues who have to go back and justify 
appropriating tax dollars from our constituents to take care of 
necessary programs like this and the money isn't being 
utilized.
    Now, I guess what I have to ask is, where has this money 
gone, where is this pot of gold that's sitting somewhere, is it 
the fact that the tribes aren't spending it? From what I have 
heard from the other witnesses, they are spending it, maybe not 
in the best possible way, but they are spending it. Is it still 
sitting in the safe in your office, figuratively speaking, Ms. 
Frechette? Where is the billion dollars? We can do a lot of 
good with a billion dollars and nobody seems to know where it 
is. I think we ought to find out.
    Ms. Frechette. Yes. The funds have been obligated to the 
grantees, which means sitting in an account for the grantees to 
draw down.
    While I will get you the dollar amount, 95 percent of those 
funds that have been appropriated from NAHASDA have been drawn 
down by the grantees and expended. Once they draw it down, they 
have to expend it within 3 days.
    The bulk of that number that you are referring to in 2013 
was from our one large grantee, who gets about $88 million a 
year; that was a concern of HUD's as well. We have been working 
with the grantee to get them to spend down their funds and--
    Mr. Sensenbrenner. How many large grantees get $88 million 
and have it add up to a billion? Maybe we are losing some 
zeroes around here.
    Ms. Frechette. They had at one time their unexpended 
balance, I believe, was around $500 million, so they are a 
large portion of the amount.
    We have been working closely with them, we have even 
engaged in an enforcement process and are currently in 
litigation to resolve the issue of expenditure.
    Mr. Sensenbrenner. Okay. I think we are going to have to 
get out the bloodhounds to find out where all this money is on 
that. HUD says that 95 percent has gone to the tribes, the 
tribes say that they are getting a shortage of money and it's 
unexpended, so we really have to solve this problem.
    What I can say is, I favor tribal sovereignty, and if the 
problem is within the tribes, then the members of the tribes 
are going to have to deal with that and fix it. And if they 
don't deal with that and fix it, you are going to see the 
argument in favor of sovereignty infringed upon in Congress and 
around the country.
    If the money is sitting somewhere around HUD, where nobody 
seems to know where it is, then the problem is with HUD.
    I think what I have gotten out of this hearing, as a non-
committee member, is that there is money that's there, that 
money is not being spent to the highest possible effect, 
according to Mr. Tribble's testimony, but there's a lot of 
money sloshing around somewhere where nobody knows what it is. 
And I think before we appropriate more than flat funding to 
continue this program, we are going to need an answer, and HUD 
is going to have to give us the answer because I can say that I 
am leaving this hearing more discouraged about the 
administration of this program than when I walked in the door 
back there. So thank you very much.
    Chairman Duffy. The gentleman yields back. The panelists 
are fine with us doing a second round. I know, Dr. Malcolm, you 
have to leave and get back to work, but thank you for coming 
and thank you for your testimony today.
    Dr. Malcolm. You are welcome.
    Chairman Duffy. The Chair now recognizes himself for a 
second 5 minutes.
    Mr. Montano, you weren't in office and in this position 
when the homes we are talking about today were built, were you?
    Mr. Montano. No, I was not.
    Chairman Duffy. You didn't design them, you didn't 
construct them, you had nothing to do with what I would argue 
is pretty shoddy construction of the homes that we are talking 
about?
    Mr. Montano. That is correct.
    Chairman Duffy. So that part, no one is putting that on you 
and you didn't actually even write this grant, you came in 
after the grant was requested?
    Mr. Montano. I participated in providing some information 
to the grant so that the grant department could write the 
grant.
    Chairman Duffy. And so I just--what I am trying to do is 
just get some clarity on where we are today.
    So in regard to the grant money and the additional money 
that LCO has put in for mold remediation, how many homes have 
been completed?
    Mr. Montano. Ten are currently completed, five more are 
under current deconstruct and reconstruct, as you have seen 
today, and the home that you walked through today is planned to 
begin the process as well.
    Chairman Duffy. So ten homes are done, all the way done?
    Mr. Montano. Complete, people are living in them.
    Chairman Duffy. And we have the next phase of five that are 
slated to be done; is that correct?
    Mr. Montano. Yes.
    Chairman Duffy. So with the ten homes that have been 
completed, how much of the $1.1-, $1.2 million has been used up 
to this point?
    Mr. Montano. That has all been used.
    Chairman Duffy. Okay. So there is no additional money from 
this grant left for the other five homes; is that fair to say?
    Mr. Montano. Yes. We are using IHBG funds to--and other 
program income to finance the reconstruction and continue 
working on the project.
    Chairman Duffy. So in regard to--did the $1.1- to $1.2 
million cover all 10 homes or did that not cover all 10 homes?
    Mr. Montano. No, it did not.
    Dr. Malcolm. How many homes did the $1.1-, $1.2 million 
cover, if you know?
    Mr. Montano. The average cost to properly remediate a home 
is dependent on several factors, one of which is, of course, 
the size of the home; we have three-bedroom homes, four-bedroom 
homes, and five-bedroom homes that remediation had to be 
performed on. The average cost is anywhere from $110,000 to 
upwards of $170,000, $180,000, depending on what it was that 
was found when we started opening things up.
    Chairman Duffy. I want to be crystal clear on that, it was 
$110,000 to $170,000 a home; is that what you are saying?
    Mr. Montano. Correct.
    Chairman Duffy. And on average, what's the square footage 
of the homes that you are remediating?
    Mr. Montano. 1,300 to about 1,500 square feet.
    Chairman Duffy. I have asked builders in our area who have 
said, to build a new home it's not just to pull the sheetrock 
and bring it down to the studs and dry it and put Kilz on, fix 
the ductwork, brand-new kitchen, brand-new construction, 
110,000 square foot, so if--now, you might have a different 
opinion on that, but I have talked to local builders that for 
110,000 square feet you could, in essence, have built a brand-
new home, with a brand-new kitchen and a brand-new basement for 
the cost of--and I have also asked about what's the cost to 
remediate a 12,000 or 1,300 square foot home, what should that 
cost us, those who are in this field.
    And at the low end, it was quite consistent with your 
estimate about $20,000 at the low end, which is what I think 
the grant estimated, but at the high end, the information I got 
back from builders and experts in our area in this space was it 
should be $45,000 to $60,000, so that would be well over what 
you, ``you'' being LCO, had proposed in the grant.
    But if it was only $60,000, which was at the high end, 
there are a lot more homes that we could remediate and a lot 
more children who wouldn't be living in a home that is full of 
mold, which is my concern.
    And so I would ask Ms. Gokee and you, Mr. Montano, I have 
asked for documents about how this money was spent, and I know 
there has been a campaign and an election on transparency, can 
both of you commit to me today that you will provide the 
documentation in regard to the grant money that came from HUD, 
documentation specifically about how this money was spent?
    Mr. Montano. Congressman Duffy, first and foremost, I think 
it's important that when we are comparing costs of construction 
or reconstruction, that there is a fair comparable, that we are 
comparing apples to apples and not oranges to apples.
    Now, I say that because I have no doubt that a local 
contractor could build a house for $100,000. I don't know what 
you are getting for $100,000, I don't know the construction 
practices that are being used for $100,000, I don't know the 
type of furnace that's being used for $100,000, I don't know 
the type of interior doors, I don't know the kind of insulation 
that is being used for $100,000.
    Chairman Duffy. These are individual, not to--I am 
interrupting you, but to clarify. They are building homes, 
licensed home builders building--
    Mr. Montano. I understand that.
    Chairman Duffy. --homes to Wisconsin code, which is a 
baseline on how we build; furnaces, insulation, doors, building 
a home--by the way, the homes I looked at were not gold-plated 
homes, these are pretty slimmed-down basic homes. Building a 
basic home to Wisconsin code, that's what I am referring to, so 
I am comparing apples to apples.
    Mr. Montano. I beg to differ with you on that, but we can 
debate that issue at some other point in time.
    But if a certain specification is written, and Mr. 
Contractor from the City of Hayward has that specification, 
gives a price on it, which we have gotten prices on, and they 
are comparable, and what we are doing to ensure that mold does 
not reoccur back in those homes. And I think it's critically 
important that we ensure that it does not happen again and we 
are coming back and saying, we need more money to fix something 
that we should have fixed right in the first place.
    I also want to comment on the fact that--
    Chairman Duffy. Mr. Montano, I reclaim my time. I have 
spoken with experts who deal with mold, at the high end, 
meaning it won't come back, they are going to get rid of the 
mold in the house, they are going to address the venting 
problems, the insulation problems, at the high end the numbers 
I got back were $60,000.
    And so I can't take up a whole lot of time because I can't 
keep my colleagues here all day. I would stay all day. I want 
to know if you are going to answer my last question, which was 
to you and to Ms. Gokee, will you provide me the documentation 
in regard to how this money was spent, specifically, show the 
receipts, show the invoices?
    Mr. Montano. Congressman Duffy, I want to back up in time--
    Chairman Duffy. Mr. Montano, I don't have a lot of time 
right now and I want to ask you that question. Will you--
    Mr. Montano. I cannot answer that question because I don't 
have liberty or--
    Chairman Duffy. You don't have--
    Mr. Montano. --authorization to answer that question.
    Chairman Duffy. Ms. Gokee, will you offer to provide those 
receipts, those invoices?
    Ms. Gokee. I don't think that there would be an issue with 
providing documentation to you, there's no secret there. I know 
that there are reporting requirements that HUD has that our 
housing authority is required to meet and which has done that. 
I recall when we met you in February, Mr. Duffy, that we did 
provide you with 2 years of audits for your review.
    And also, you are making allegations here that the tribe is 
misspending money; I take offense to that.
    Chairman Duffy. Oh, I am not--
    Ms. Gokee. I take offense to that because you have not 
checked clearly into the facts. We invited you here to Lac 
Courte Oreilles--
    Chairman Duffy. And I--
    Ms. Gokee. --on numerous occasions, you are here now; it's 
Lumberjack Weekend, we invited you here. And out of respect for 
the government-to-government relationship, I would expect that 
our Congressman would come here and meet with us about your 
concerns, we would have been more than happy to answer all of 
your questions.
    Chairman Duffy. And so that goes back to my question, are 
you--
    Ms. Gokee. We will provide you the documents, as we 
provided those documents to HUD, as we are required to report.
    Now, there is no misappropriation of funds because we need 
to cover expenses first, provide documentation, and then we 
receive our reimbursement.
    There's no misappropriation of funds--
    Chairman Duffy. So Ms. Gokee--
    Ms. Gokee. --the problem here is we are underfunded, that 
is it.
    Chairman Duffy. So Ms. Gokee, if that's the case, I have 
asked for different information than HUD has asked for. I am 
drilling down specifically into an issue that Mr. Tribble and 
others have written me about. And though you represent tribal 
members, so too do I, and this is Federal taxpayer money, and 
so I have an obligation to Mr. Tribble and tribal members who 
are living in homes that haven't been remediated, that they 
were told would be remediated, to ask questions, see receipts, 
see documentation.
    And in regard to not what you provided HUD, but--and what I 
have asked the tribe to provide me and to provide Mr. Tribble 
and everybody else who was asked, are you going to provide me 
those documents?
    Ms. Gokee. Absolutely.
    Chairman Duffy. Thank you, I appreciate that, because that 
is the starting point. And I have told you, Ms. Gokee and Mr. 
Montano, I want to make sure this money was spent well. You 
show me those documents, we expose this and you can show me 
that, I am going to join Ms. Moore and we are going to go fight 
for more money, but I am not going to do that until I can 
answer the questions that Mr. Tribble has asked me and others 
have asked me, and so we can have a partnership, but it starts 
with transparency.
    And I appreciate Chairman Taylor for committing to making 
sure we have an inter-governmental relationship that we can 
build trust and transparency, which allows us to better fight 
for your needs. So I appreciate your willingness now, after 
many months of my request outstanding, that you are going to 
provide that information.
    Ms. Gokee. So are you also saying that when we need your 
assistance, Congressman Duffy, we request you to come and meet 
with us, that you will also honor that government-to-government 
relationship and meet with--
    Chairman Duffy. Absolutely.
    Ms. Gokee. --the tribe regarding our needs in our community 
as well?
    Chairman Duffy. Absolutely. I will ask, Ms. Gokee and to 
the panel, how many Congressional hearings have you had at the 
LCO reservation? The answer is none. I have answered the call 
that tribal members had to fight for their homes, to fight for 
their health, and that's why I have asked Ms. Moore and I have 
asked Mr. Sensenbrenner and why I have talked to everyone on 
Ms. Moore's side of the aisle and on our side of the aisle 
about this issue that is happening at LCO, and we have been 
asked, when we come back from this hearing, to report about 
what we found.
    Though you have only three Members of Congress, you have a 
whole committee who cares about what's happening here, because 
the stories I tell have both sides outraged, and so you have a 
Congressman who is here today holding a hearing, fighting for 
your people and that hasn't happened yet.
    So with that, my time has expired, and I yield to the 
gentlelady from Wisconsin.
    Ms. Moore. I guess I would ask the audience to clap for me 
before I speak, just in case you don't like what I say.
    Just let me say, I want to keep the main thing, the main 
thing, I am here for a hearing on, ``NAHASDA: 20 Years On,'' so 
I want to clarify with the panel here that NAHASDA has been 
effective. Am I wrong about that, Ms. Frechette, from the 
Department of Housing and Urban Development, that NAHASDA has 
worked?
    Ms. Frechette. Yes, I think tribes, the independent study 
that was conducted and also the continual funding that 
NAHASDA--
    Ms. Moore. Could you speak up a little bit. I know I am a 
loudmouth, but--
    Ms. Frechette. I think the tribes would agree, I think that 
the independent study that I quoted earlier agrees and 
continual funding, as well as the number of units that have 
been produced and the leveraging and attraction of private 
dollars that--
    Ms. Moore. They have been able to leverage. And, Mr. 
Tribble, would you agree that NAHASDA is very, very critical 
and has been effective?
    Mr. Tribble. Yes.
    Ms. Moore. Okay, so we all agree on that. And none of the 
funds that we are talking about here today that have been 
focused on, we are focusing on the importance of reauthorizing 
NAHASDA and so I just wanted to get it in the record, Mr. 
Chairman, that NAHASDA works.
    I also wanted to deal with the questions that my good 
friend Mr. Sensenbrenner raised about the unexpended funds for 
projects that are receiving over $5 million, and I guess I am 
going to start with Mr. Walters and Ms. Frechette regarding 
this.
    Now, the problem came in from the Navajo, who use a great 
deal of the NAHASDA funds, and they have expended the funds, 
but is it or is it not true that 95 percent of the other tribes 
are teeny-weeny tribes and what they do is that they have 
obligated funds from previous cycles, but they have not 
expended them because they need to save up these funds in order 
to do a project of any magnitude. So it's not that the funds 
are being squirreled away or misappropriated or fraudulently 
misused, these are funds that are not adequate from one year to 
the next and so they are saved and they are subject to Indian 
housing plans that move from year to year.
    Ms. Frechette, Mr. Walters, can you share with us, give us 
an education about these obligated but not expended funds?
    Ms. Frechette. Thank you. Yes, as I responded to 
Representative Sensenbrenner's line of questioning, and I do 
have the dollar amounts for you, sir, $11.9 billion in IHBG 
funds has been awarded over the history of the program, $11.4 
billion has been expended. The 2013 $1 billion level was at a 
point in time, has since been spent down, so it remains $536 
million unexpended, $200 million of that is the Navajo Nation's 
unexpended balance, so that's about 5 percent of the grant.
    And then the $336 million unexpended is across 567 tribal 
grantees, so all of the money has been obligated; it is not 
located at HUD, it is available. But as you said, many of them 
are small grantees that get about $50,000 or more a year that 
have to bank the money for several years to even produce one 
home.
    Ms. Moore. Thank you. Anything to add very quickly, Mr. 
Walters?
    Mr. Walters. Just briefly, in 2013, when that report came 
out, tribes themselves took notice as well and they took steps 
to try to address this issue through negotiated rulemaking. 
There is language that was developed through rulemaking where 
tribes are limited to new funds if their unobligated balance is 
3 times their annual. So if a tribe is saving up its funds, and 
usually in a way that you describe, they save up money to 
actually complete a single project, a larger project, they will 
be penalized for that in the sense that they would not be able 
to get future funds from the fourth, fifth, sixth year until 
they do spend those moneys back down, so that would have been a 
direct response.
    Ms. Moore. Thank you so much.
    I also just wanted, Mr. Chairman, to get on the record just 
to find out, one of the discussions we are having on a 
bipartisan basis is the importance of including all indigenous 
people in the language, and I was wondering if you all agree 
that Native Hawaiians ought to be included in the NAHASDA 
package as eligible recipients of NAHASDA funds. Mr. Montano?
    Mr. Montano. Congresswoman Moore, I would have to say, yes, 
we could agree to that, as long as it does not further dilute 
the already underfunded funds that come to us.
    As native peoples and indigenous peoples of this land, the 
first Americans of this land, we respect our brothers and 
sisters; and if they happen to be Native Hawaiians, whom LCO 
has a very close relationship with due to their language 
immersion school, then so be it. But I do not think it would be 
right if we were to discriminate against them, but in the same 
sense we have to make certain that whatever money we are 
getting, we are not further diluting it down.
    Ms. Moore. Yes, I get that, they are your brothers, you 
just don't want to split the money up too much. I get that, you 
need more money.
    I am afraid that my time is going to expire, so I just want 
to make one point about stewardship over taxpayers' funds.
    We are all taxpayers, including Indians, and we are all 
citizens of the United States, you all have dual citizenship, 
and I just want to point out that when we start talking about 
taxpayer funds, that it is your tax funds as well.
    So with that, Mr. Chairman, I would respectfully yield back 
to you.
    Chairman Duffy. The gentlelady yields back. The Chair now 
recognizes the gentleman from Wisconsin, Mr. Sensenbrenner, for 
5 minutes.
    Mr. Sensenbrenner. Thank you very much. I did not go on the 
house tour this morning. I am glad I didn't, because I have bad 
hay fever, and if I had gone into that moldy house, I would 
have had to blame Mr. Duffy and Ms. Moore for making me cry, 
and I don't want to have to do that, but there is a problem 
here and that is why we are here today.
    Ms. Frechette, I am glad, though, that you found $464 
million since the first round of my questioning, but there 
still is over half a billion dollars that is obligated but 
unexpended.
    Now, maybe the Navajo are not very good at spending money, 
they have $200 million left in the sod, but there is a problem 
in terms of getting the money that Congress appropriates out 
the door and actually being used to do what that money was 
appropriated to be used for.
    Now, I have two questions, Ms. Frechette. First, what kind 
of internal procedures does your agency have to make sure that 
the money is being used once it goes out of your door.
    And second, what kind of auditing procedures do you have to 
make sure that the mess that I have heard about today, which I 
didn't know anything about until this morning about lack of 
transparency in the tribe and things like that, don't happen?
    Because when there is a dispute, as I have heard from 
people at that end of the witness table, it certainly doesn't 
do any part of this program any good. And the question is, how 
do we prevent future disputes from happening, that end up 
spilling out into the Congressional offices, oversight letters, 
hearing unfavorable news coverage and the like, that's what the 
bottom line of oversight has to be and I am hopeful that this 
hearing is going to solve all of these problems so that me 
representing that part of Wisconsin that is referred to as 
``down there,'' up here, never has to hear about it again. So 
how are you going to do that?
    Ms. Frechette. In regard to getting the funds out in a 
timely manner, we have several tools that we didn't have in the 
past. This accumulative amount is over time, before my tenure 
at HUD. However, since that time the appropriations used to be, 
know your money, there was statutory language that allowed 
tribes to carry it over and that's what happened.
    As Mr. Walters indicated, tribes are now mindful of the 
fact that they have a responsibility to expend that money in 
the manner that they had told HUD they would.
    The other tool is the language that was negotiated during 
the negotiated rulemaking with HUD, that other tribes are 
concerned as well as HUD to have more teeth to be able to go 
after those tribes that don't expend their funds and that's why 
there's 3-times language, which provides anyone over $5 million 
grantee who has 3 times their balance will forfeit that money 
in the future, so we have those tools.
    In addition, we have statutory language that requires us to 
get the initial grant allocations out to the grantees within 60 
days upon passage of the appropriations.
    And then on the programmatic level, there has been much 
more of a focus under my tenure on the performance end. We 
don't want to be on the back end with enforcement, we want to 
be on the front end to make sure that those dollars are being 
used effectively in the community.
    One particular concern that we have heard with Navajo and 
some other tribes is the fact that new units are not being 
constructed and a lot of money is going into rehab. We are 
focused on, how can we get the best bang for the buck as far 
as--especially with these resources.
    Mr. Sensenbrenner. My question to you is, is HUD going to 
be prepared to be the performance police that says, until you 
perform you are not going to get any more money, that is the 
way to get the attention of lack of performance pretty quickly, 
I would submit.
    Ms. Frechette. Right. We have statutory and regulatory 
authority, we don't have that authority in the statute of the 
regulations because it is a block grant, because it's based on 
self-governance. If that is something that Congress would like 
us to do, we would need the authority to be able to do that.
    Mr. Sensenbrenner. Let me see if those of us who believe in 
tribal self-determination, the issues that we have heard about 
down at the other end of the table should be resolved within 
the tribe, rather than spilling over either to HUD or, even 
worse, to Congress.
    I have been in this business quite a long time and I can 
say that people who have problems with Federal agencies that 
get in contact with me and with my office are basically at 
their wit's end, they have tried everything that they can with 
the Federal departments and agencies; it is more that they 
haven't gotten an adequate answer, than that they disagree with 
the answer.
    Most of the casework I do is not resolved favorably with 
the constituent, but the constituent is entitled to an answer 
on why the answer is no; and I don't see this coming out of 
HUD, in terms of preventing disputes like this from boiling 
over. Please work a little harder.
    Ms. Frechette. Thank you. And I would like to note that we 
didn't get contacted directly from the individual who has some 
concerns, but we did get contacted from Chairman Duffy's office 
and have been working over several months to be responsive, to 
look into it deeper and also to provide the information 
requested.
    Mr. Sensenbrenner. I yield back.
    Chairman Duffy. The gentleman yields back. I know Ms. Moore 
has to catch a flight out as well. I want to thank our panel 
for your testimony today, and from this point I look forward to 
moving forward with regard to far more transparency, which Ms. 
Gokee has committed to, and I know that the tribal government 
has as well, making sure this is a new start, to make sure we 
resolve the issues that have been brought up here today.
    Because this is about people, this is about families, this 
is about children; and that is not partisan, that's American, 
and so I look forward to this hearing being our starting point 
and partnership with our LCO tribe.
    Jimmy Edmund is here from their State Government, but also 
with our Federal Government, making sure we are partnering to 
address these problems.
    So with that, again, to our panel, thank you for your 
testimony.
    The Chair notes that some Members may have additional 
questions for this panel, which they may wish to submit in 
writing. Without objection, the hearing record will remain open 
for 5 legislative days for Members to submit written questions 
to these witnesses and to place their responses in the record. 
Also, without objection, Members will have 5 legislative days 
to submit extraneous materials to the Chair for inclusion in 
the record.
    Without objection, this hearing is now adjourned.
    [Whereupon, at 11;15 a.m., the hearing was adjourned.]

                            A P P E N D I X



                             July 21, 2017
                             
                             
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