[Senate Hearing 116-16]
[From the U.S. Government Publishing Office]







                                                         S. Hrg. 116-16

      BUILDING OUT INDIAN COUNTRY: TOOLS FOR COMMUNITY DEVELOPMENT

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

                                HEARING

                               before the

                      COMMITTEE ON INDIAN AFFAIRS
                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 10, 2019

                               __________

         Printed for the use of the Committee on Indian Affairs
         
         
         
         
         
         
         
         
         
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36-244 PDF                WASHINGTON : 2019                 
	        
         
         
         
         
         
         


                      COMMITTEE ON INDIAN AFFAIRS

                  JOHN HOEVEN, North Dakota, Chairman
                  TOM UDALL, New Mexico, Vice Chairman
JOHN BARRASSO, Wyoming               MARIA CANTWELL, Washington
LISA MURKOWSKI, Alaska               JON TESTER, Montana,
JAMES LANKFORD, Oklahoma             BRIAN SCHATZ, Hawaii
STEVE DAINES, Montana                CATHERINE CORTEZ MASTO, Nevada
MARTHA McSALLY, Arizona              TINA SMITH, Minnesota
JERRY MORAN, Kansas
     T. Michael Andrews, Majority Staff Director and Chief Counsel
       Jennifer Romero, Minority Staff Director and Chief Counsel






















                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on April 10, 2019...................................     1
Statement of Senator Cortez Masto................................    32
Statement of Senator Daines......................................    33
Statement of Senator Hoeven......................................     1
Statement of Senator Murkowski...................................    37
Statement of Senator Smith.......................................     3
Statement of Senator Udall.......................................     2

                               Witnesses

Childs II, Henry, National Director, Minority Business 
  Development Agency, U.S. Department of Commerce................    15
    Prepared statement...........................................    16
Harris, Jodie, Director, Community Development Financial 
  Institutions Fund, U.S. Department of the Treasury.............    10
    Prepared statement...........................................    11
Ponti-Lazaruk, Jacqueline, Chief Innovation Officer, Rural 
  Development, U.S. Department of Agriculture....................    20
    Prepared statement...........................................    22
Sweeney, Hon. Tara Mac Lean, Assistant Secretary, Indian Affairs, 
  U.S. Department of the Interior................................     4
    Prepared statement...........................................     6
Thompson, Hon. Mark, Lieutenant Governor, Acoma Pueblo; Board 
  Member, Indian Pueblo Cultural Center..........................    26
    Prepared statement...........................................    27

                                Appendix

Ahuja, Kiran, CEO, Philanthropy Northwest, prepared statement....    45
United South and Eastern Tribes Sovereignty Protection Fund USET, 
  prepared statement.............................................    50

 
      BUILDING OUT INDIAN COUNTRY: TOOLS FOR COMMUNITY DEVELOPMENT

                              ----------                              


                       WEDNESDAY, APRIL 10, 2019


                                       U.S. Senate,
                               Committee on Indian Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:30 p.m. in room 
628, Dirksen Senate Office Building, Hon. John Hoeven, 
Chairman of the Committee, presiding.

            OPENING STATEMENT OF HON. JOHN HOEVEN, 
                 U.S. SENATOR FROM NORTH DAKOTA

    The Chairman. Good afternoon.
    I call this oversight hearing on Building Out Indian 
Country: Tools for Community Development to order.
    Today, we will hear from Federal agencies and tribal 
leaders on how Federal financing tools, such as loans, grants 
and technical assistance, are being deployed in tribal 
communities.
    Since 2006, this Committee has held eight hearings on 
economic and community development in Indian Country. Testimony 
in prior Committee hearings, information from tribal leaders 
and literature all reveal significant challenges facing Indian 
tribes and individual business owners.
    A survey of business owners conducted by the Census Bureau 
found that nearly two-thirds of Native American businesses were 
started with the use of either personal and family savings or 
credit cards. This demonstrates the lack of access to 
traditional investment sources such as bank loans.
    In addition to the lack of access for start-up capital, 
some of the most notable challenges are lack of interest from 
lenders and secondary markets, greater need for credit 
subsidies, and a lack of business education in tribal 
communities. Traditional models of financing do not always work 
in rural communities. This is especially true on tribal lands 
where land title issues, as well as the difficulty in 
collateralizing tribal assets, make investors wary of working 
with tribes.
    Local community banks and community development financial 
institutions can fulfill those investment needs. For instance, 
in my home State of North Dakota, there are five community 
development financial institutions that since 1996 have been 
awarded nearly $6.1 million from the CDFI Fund at the Treasury 
Department.
    Also, building credit and developing human capital affects 
the ability of tribal businesses to begin and maintain 
operations. According to the Bureau of Labor statistics, the 
current unemployment rate for Native Americans is 7.8 percent.
    Since the Bureau began keeping this data in 2000, the all-
time lowest percentage of unemployment for Native Americans was 
7.5 percent. That means at this point, we are near some of the 
lowest unemployment statistics for Native Americans. However, 
this rate is still more than double the national rate of 3.8 
percent.
    As the present Administration continues to promote policies 
such as regulatory reform, it is important that these positive 
impacts are felt in Indian Country. That is why on January 24, 
2019, I reintroduced the Indian Community Economic Enhancement 
Act of 2019. The ICEE Act, Senate Bill 212, aims to address the 
disparity in economic opportunities that tribal businesses and 
Native entrepreneurs face by amending existing law to increase 
access to capital, attract businesses to Indian communities, 
and lessen the cost of economic development by reducing Federal 
bureaucracy.
    The ICEE Act amends the Native American Business 
Development Trade Promotion and Tourism Act of 2000 to require 
coordination between the Secretaries of Commerce, Interior and 
Treasury to develop initiatives and encourage investment in 
Indian communities. It also elevates the Director of Indian 
Programs in the Department of Commerce and permanently waives 
the requirement for Native CDFIs to provide a matching cost 
share for assistance received by the Treasury CDFI.
    The Committee favorably reported the bill on January 29, 
2019. I look forward to seeing the legislation enacted into 
law.
    Community and economic development are essential to the 
long term health and stability of our Native communities. It is 
why this Committee has frequently held hearings on the subject 
and why we return to it today.
    With that, I will now turn to Vice Chairman Udall for his 
opening statement.

                 STATEMENT OF HON. TOM UDALL, 
                  U.S. SENATOR FROM NEW MEXICO

    Senator Udall. Thank you, Chairman Hoeven. Thank you for 
calling today's hearing.
    Before I begin, Senator Tina Smith has told me that she has 
constituents here. I understand they are Close Up students with 
their teacher from Red Lake Indian Reservation near Red Lake, 
Minnesota. Welcome to all of you. I know you will find this an 
interesting hearing.
    Enhancing economic development opportunities in Indian 
Country is critically important, whether it is access to 
financial capital or infrastructure such as housing, water and 
sewer systems, roads and bridges. It is no secret that Native 
communities face ongoing and often unique challenges when it 
comes to growing business development opportunities. The 
agencies represented here today, DOI and USDA, Commerce and 
Treasury, all have programs aimed at easing these challenges 
for tribes and Native business owners.
    However, having these programs on the books is not enough. 
Federal agencies must ensure that tribes are actually getting 
the resources they need and the technical assistance they 
deserve to use the programs effectively. In short, Federal 
agencies must take an all-hands-on-deck approach to supporting 
economic development in Indian Country so that economic 
development efforts are coordinated and complimentary.
    A key factor to attracting and sustaining businesses in 
Indian Country is marketing its healthy workforce as a way to 
support the next generation of Native American innovators. My 
bill, the Native American Business Incubators Program Act, 
promotes investor confidence while also filling a critical gap 
for Native entrepreneurs, who not only need access to work 
space and opportunities to build professional networks, but 
also access to community expertise, particularly as it applies 
to doing business on trust lands.
    This bill would complement existing Federal programs to 
better support entrepreneurship in Indian Country. I am hopeful 
it will become law this Congress.
    Instead of supporting programs that target tribal economic 
growth, the President's budget for fiscal year 2020 proposed 
drastic cuts or outright elimination of many of the successful 
initiatives we will be discussing today, like the Indian Loan 
Guarantee Program.
    The Loan Guarantee Program has long been essential to the 
success of Native borrowers, including Picuris Pueblo which 
used the program to build the Hotel Santa Fe and the Indian 
Pueblo Cultural Center which Lieutenant Governor Thompson will 
describe used the program to build a convenience store, a 
coffee shop and a world class museum that educates visitors 
about the history and culture of New Mexico's Pueblos.
    Since its inception, the program has distributed $1.6 
billion across Indian Country. In New Mexico's specifically, it 
has helped spur tribal business enterprises worth tens of 
millions of dollars. Despite these and many other success 
stories, the President has proposed eliminating this loan 
guarantee program.
    I am looking forward to hearing from today's witnesses, 
especially Mark Thompson, the Lieutenant Governor of Acoma 
Pueblo and board member of the Indian Pueblo Cultural Center in 
Albuquerque on this topic and more. Thank you, Lieutenant 
Governor, for joining us today.
    I would also like to welcome Assistant Secretary Tara 
Sweeney to her first hearing since being confirmed. As Indian 
Country's lead advocate in the Administration, I hope we will 
be seeing more of you in the coming months. Welcome, Tara.
    I hope you and the other folks here from the Administration 
will offer some insights into how we can improve Federal 
community development efforts in Indian Country.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Vice Chairman.
    I would ask, Senator Smith, do you have any opening 
statement, you would like to make?

                 STATEMENT OF HON. TINA SMITH, 
                  U.S. SENATOR FROM MINNESOTA

    Senator Smith. Thank you, Mr. Chairman.
    I would just like to add my welcome to the students from 
Red Lake. It is wonderful to have you all here. Thank you for 
coming to my coffee this morning. I think it is the second time 
in one day we have had a chance to see each other. Thanks so 
much for being here.
    The Chairman. With that, we will turn to our witnesses.
    Our witnesses today are the Honorable Tara Mac Lean 
Sweeney, Assistant Secretary, Indian Affairs, U.S. Department 
of the Interior, Washington, D.C.; Ms. Jodie Harris, Director, 
Community Development Financial Institutions Fund, U.S. 
Department of the Treasury; Mr. Henry Childs, II, National 
Director, Minority Business Development Agency, U.S. Department 
of Commerce, Washington, D.C.; Jacqueline Ponti-Lazaruk, Chief 
Innovation Officer, Rural Development, U.S. Department of 
Agriculture, Washington, D.C.; and the Honorable Mark Thompson, 
Lieutenant Governor, Acoma Pueblo and Board Member, Indian 
Pueblo Cultural Center, Albuquerque, New Mexico. Welcome.
    For our first three witnesses, Interior, Commerce and 
Treasury, our Rule 4(b) states witnesses must state on the 
record why your testimony is late. It is supposed to be in 48 
hour prior. My staff has asked that I ask you to state on the 
record why your testimony was late as part of your introductory 
remarks.
    With that, we will begin with Ms. Sweeney.

 STATEMENT OF HON. TARA MAC LEAN SWEENEY, ASSISTANT SECRETARY, 
              INDIAN AFFAIRS, U.S. DEPARTMENT OF 
                          THE INTERIOR

    Ms. Sweeney. Chairman Hoeven, Vice Chairman Udall, and 
members of the Committee, my name is Tara Mac Lean Sweeney and 
I am the Assistant Secretary of Indian Affairs at the U.S. 
Department of the Interior.
    Thank you for the opportunity to testify. My testimony 
today will provide a high level overview of my written 
comments.
    My service began in July 2018 and since that time, I have 
focused on three critical components to move the economic 
needle in and for Indian Country first, by analyzing the 
current state of operations within Indian Affairs and executing 
administrative adjustments and solutions to improve service 
delivery to Indian Country.
    It is the responsibility of Indian Affairs to deliver 
efficient and effective services to Indian Country as we 
continue to work to meet our trust responsibilities and treaty 
obligations. Second is walking into the wind to face the social 
challenges in our communities and specifically, building a 
strategy to address our Native American focused cold cases of 
violent crimes and missing and murdered American Indian and 
Alaska Native women and children.
    I proudly stand with our law enforcement and social 
services employees working to provide them with the tools 
necessary to battle at all levels on behalf of our people. 
Healthy communities attract outside investment and local 
reinvestment which is one reason why school and public safety 
guide decisions made by my hallway.
    The third component is to take a proactive approach to 
building an economic road map for development and growth in 
Indian Country. This must be done in partnership with our 
tribal leadership, tribal enterprises, Alaska Native 
corporations, Native-owned financial institutions, the 
financial sector, our Federal partners, and Congress.
    Indian Affairs is poised to develop a robust pathway for 
stakeholders interested in investing in our Native communities. 
There are strong examples of the steps that Indian Affairs has 
taken and is about to embark on. I would like to share them 
with the Committee today.
    We provide direct and indirect support for economic growth 
in Indian Country. Our focus includes the development of energy 
and mineral resources, increasing access to capital, assisting 
business development, and encouraging development of 
transactional capacity in tribal communities.
    Indian Country directly benefits from the Administration's 
Energy Security Initiative. Energy royalties paid last year to 
Indian tribes and allottees totaled over $1 billion. Energy 
production in Indian Country as a source of revenue is now 
second only to gaming.
    Indian Affairs provides technical assistance on 37 gas and 
oil projects, 83 renewable energy projects and 61 mineral 
projects. Mr. Chairman, your bill, S. 245, streamlines the 
approval of tribal energy resource agreements thereby 
encouraging tribal self determination in the development of 
energy on Indian trust lands without unnecessary Federal 
oversight.
    Indian Country has expressed an interest in opportunity 
zones. An opportunity zone is an economically distressed 
community where new investments, under certain conditions, may 
be eligible for preferential tax treatment.
    Tribes deserve equal footing and access to opportunity 
zones. I am committed to working with the Committee, the 
Treasury, and tribal leaders to ensure appropriate measures are 
taken to ensure that tribes have the opportunity to develop 
their local economies and investors have the opportunity to 
choose Indian Country for their portfolios.
    Our Native American Business Development Institute grants 
are a vehicle for tribes and tribal businesses to take 
advantage of opportunity zones. For the fiscal year 2019 grant 
cycle, we have created an opportunity zone preference for 
tribal applicants.
    Finally, most tribes lack commercial codes to secure 
collateral and assure access to credit. Without these codes and 
an accurate, accessible system for filing claims, creditors may 
increase borrowing costs to offset the risks or refuse to lend 
altogether. We are helping tribes develop the legal 
infrastructure that is critical to economic progress.
    I want to conclude by recognizing that small businesses are 
the life blood of community development. They are necessary to 
achieve the multiplier effect in Indian Country where a dollar 
turns over six or seven times among community members before it 
leaves the local economy.
    I want to drive our efforts to foster healthy economic 
environments in Indian Country to support small business. I am 
committed to empowering our tribal governments, communities and 
Native enterprises to develop sustainable economies. I look 
forward to working with this Committee, members of Congress and 
the Administration to accomplish these goals.
    Thank you.
    [The prepared statement of Ms. Sweeney follows:]

Prepared Statement of Hon. Tara Mac Lean Sweeney, Assistant Secretary, 
            Indian Affairs, U.S. Department of the Interior
    Chairman Hoeven, Vice-Chairman Udall, and Members of the Committee, 
my name is Tara Mac Lean Sweeney and I am the Assistant Secretary of 
Indian Affairs at the U.S. Department of the Interior (Department).
    Thank you for this opportunity to testify on ``Building out Indian 
Country: Tools for Community Development.''
    Economic growth is an impactful antidote to the social and 
financial challenges facing Native communities, and I am proud that it 
is a priority for the Trump Administration. A strong economy presents 
opportunities for employment, commerce and the tools necessary to 
empower communities to create healthier and safer living conditions for 
its members.
    We believe the best vehicle for sustainable community development 
is economic growth and the influx of employment opportunities it 
brings. My experience in the private sector, working to develop Native 
economies, and create job opportunities for Indian Country has provided 
me with invaluable experience. As Assistant Secretary I have made it a 
priority to implement a robust economic development agenda.
    For our part, Indian Affairs provides direct and indirect support 
for economic growth in Indian Country. Our economic development focal 
points are: (1) the development of energy and mineral resources; (2) 
increasing access to capital; (3) assisting business development; and 
(4) encouraging development of transactional capacity in tribal 
communities.
    I am proud to appear before the Committee today as your partner and 
as an advocate for community development and economic growth in Indian 
Country.
Energy and Mineral Resource Development In Indian Country
    Thanks to President Trump's initiative to achieve U.S. energy 
dominance, the U.S. is now a leading exporter of crude oil and 
liquefied natural gas (LNG). It was reported last month that the U.S. 
now exports more crude oil and petroleum products than it imports and 
some analysts project that we will soon pass Saudi Arabia as an 
exporter of crude oil and other petroleum-based liquid fuels. \1\ U.S. 
exports of LNG quadrupled in 2017 and continue to increase with the 
construction of new LNG export facilities. \2\
---------------------------------------------------------------------------
    \1\ https://oilprice.com/Energy/Crude-Oil/US-Will-Soon-Export-More-
Oil-Liquids-Than-Saudi-Arabia.html
    \2\ https://www.eia.gov/todayinenergy/detail.php?id=35512
---------------------------------------------------------------------------
    Indian Country directly benefits from the Administration's energy 
dominance initiative. Energy royalties paid last year to Indian tribes 
and allotters' totaled over $1 billion. \3\ Energy production in Indian 
Country, as a source of revenue is now only second to gaming.
---------------------------------------------------------------------------
    \3\ https://revenuedata.doi.gov/explore/#federal-disbursements

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      Energy Royalties to Indian Country

        2018: $1,022,539,457 (As of October 1st 2018)
        2017: $561,409,816
        2016: $476,207,228
        2015: $736, 839, 260

    Our Department's Division of Energy and Mineral Development (DEMD), 
which is part of our Office of Indian Energy and Economic Development 
(IEED), currently provides technical assistance on 37 gas and oil 
projects, 83 renewable energy projects, and 61 mineral projects.
    These projects have the potential to generate even more energy and 
mineral derived benefits for Tribes. OIEED using its internal 
engineers, geologists and geophysicists have completed internal 
scientific and engineer studies to determine the following resource 
potential. Among them are:

   A geologic study of the Pilot Butte and Steamboat Butte oil 
        fields at the Wind River Reservation in Wyoming whose value 
        DEMD estimates could exceed $50 million;

   A DEMD funded, 16-mile, 3-D seismic survey at the Rocky Boys 
        Reservation in Montana that could be a source of tribal 
        revenues if the land proves productive;

   An analysis of the Gallup and Fractured Mancos plays at the 
        Jicarilla Apache Reservation in New Mexico that could lead to 
        substantial revenues to the Tribe when all of its oil-bearing 
        lands are developed;

   An examination of helium sources at the Navajo Nation in 
        Arizona whose development DEMD estimates could bring 
        significant royalties to the Navajo Nation and other Tribes in 
        the area;

   Assistance with enhanced oil recovery methods at the Osage 
        Reservation in Oklahoma aimed at development of potential 
        reserves;

   Assistance to the Metlakatla Indian Community on Annette 
        Island Reserve, Alaska with engineering design and construction 
        of its Chester Lake Penstock Extension Project to improve 
        hydropower and water security during drought years;

   Work at the Fond du Lac Band of Chippewa Indians in 
        Minnesota to use woody biomass to displace propane use at the 
        Tribe's community center, which is saving $21,000 per year. 
        Engineering and planning assistance for the Tribe's development 
        of a 1MW solar array is saving another $80,000 per year;

   Technical assistance to the Confederated Salish and Kootenai 
        Tribes of the Flathead Reservation in Montana which enabled 
        them to acquire the 188 MW Kerr Dam Hydroelectric Project. 
        Operated under the tribal owned company, Energy Keepers, Inc., 
        this project is generating more than $9 million a year for the 
        Tribes;

   Commissioning of a 1 MW solar array at the Picuris Pueblo in 
        New Mexico, which is offsetting 100 percent of the energy costs 
        for 50 homes and 12 tribal buildings;

   Completion of feasibility and planning studies to develop a 
        1.5 MW wind turbine at the Spirit Lake Reservation of North 
        Dakota that DEMD forecasts will save over $600,000 in annual 
        energy costs;

   Identification of a natural gas service expansion at the 
        Mississippi Choctaw Reservation that, by displacing propane 
        use, will achieve $1 million in savings per year;

   Completion of engineering and planning studies at the Blue 
        Lake Rancheria in California for a solar-battery micro-grid 
        system that will save the Tribe $200,000 annually;

   Completion of engineering and planning studies for a 6 MW 
        solar development at the Twenty-Nine Palms Reservation in 
        California, which DEMD believes will generate $1 million in 
        annual revenue;

   Identification of sand and clay material at the Jemez Pueblo 
        in New Mexico that the Tribe will use to construct 85 durable, 
        energy-efficient, custom-designed homes; and

   Identification of a 50-year supply of cement-grade limestone 
        at the Moapa Reservation of Nevada.

    As we've observed the surge in energy development, we have 
concurrently determined to take a close look at the Department's right-
of-way regulations as they pertain to energy and mineral resource 
development in Indian Country. We've put a call out to tribal leaders, 
as well as our internal institutional knowledge resources, to share how 
these regulations may be improved.
    Our goal is to reduce the regulatory burden for right-of-way 
approval processes and better enable tribes to sustainably develop 
their natural resources. Sustainable development is our intent and 
Indian Affairs as a whole is working to improve service delivery and 
efficiency to tribal enterprises interested in developing their 
minerals, oil, gas, and other natural resources.
S. 245 The Indian Tribal Energy Development and Self-Determination Act 
        Amendments of 2017
Tribal Energy Resource Agreements (TERA)
    Mr. Chairman, we are pleased to note the enactment of your bill, S. 
245, the Indian Tribal Energy Development and Self-Determination Act 
Amendments of 2017. This bill streamlines our Department's approval of 
Tribal Energy Resource Agreements (TERAs), thereby encouraging tribal 
self-determination in the development of energy on Indian trust lands. 
TERAs authorize tribal energy contracts, leases, and rights-of-way 
without unnecessary federal oversight.
    On the same topic, a Department working group, under the direction 
of the Acting Secretary, has been examining the issue of inherent 
federal functions, which this Committee and tribes have said is an 
obstacle to seeking TERAs. We hope that modifications proposed by the 
working group, combined with revisions to the TERA regulations 
implementing provisions of your bill, will encourage tribes to apply to 
our Department for TERAs.
Tribal Biomass Demonstration Project
    Your bill also authorizes biomass demonstration projects for tribes 
and Alaska Native corporations. Our BIA foresters are working 
diligently to implement the tribal biomass demonstration projects 
authorized by the bill. Discussions are ongoing with key federal 
partners as well as with tribal groups, such as the Intertribal Timber 
Council, to cultivate awareness of the bill's provisions and encourage 
thinking about the possibilities it presents for Indian Country, and to 
identify projects that have been proposed by tribes that may be 
suitable for meeting the bill's objectives.
    Given the expedited statutory timeline, we will be hosting a Tribal 
Consultation by telephone (ensuring maximum tribal participation) on 
Friday, April 12, at 1:00 p.m. Eastern Time.
    Our goal is to support projects that are portable and scalable, so 
that the successes and lessons learned in one project can be expanded 
for the benefit of other tribes throughout the country. Thus smaller-
sized projects may serve as test cases to be applied at a larger scale 
with processes and methods that are proven and practical. We see the 
heart of these demonstration projects as utilizing biomass development 
to foster land management activities that expand the active forest 
management, as practiced in Indian Country, to other federal lands, 
with outcomes including the reduction of wildfire risks, improvement of 
forest health, and the creation of much needed energy from an abundant 
source of renewable forest biomass.
Increasing Access To Capital In Indian Country
    As the Assistant Secretary, I am looking forward to creating 
greater access to capital in Indian Country. This means building 
partnerships, stepping outside of our traditional comfort zones, and 
expanding our networks. I am excited to convene government agencies, 
tribes, Alaska Native Corporations, and other investment officials to 
form strategic partnerships and develop a roadmap to positive 
investment environments in Indian Country.
Opportunity Zones
    There is a groundswell of interest in Indian Country around 
Opportunity Zones. Indian Affairs is grateful for the provisions 
included in the Tax Cuts and Jobs Act of 2017. Congress added 
Opportunity Zones to the tax code when it passed the Tax Cuts and Jobs 
Act on December 22, 2017, 26 U.S.C., 1400Z-1 and 1400Z-2. An 
Opportunity Zone is an economically-distressed community where new 
investments, under certain conditions, may be eligible for preferential 
tax treatment. We believe that there are millions of dollars in 
investment funds waiting on the sidelines that this new incentive can 
attract to projects and locations within Indian Country. However, we 
are working to ensure that tribal voices are heard as the regulations 
supporting the Opportunity Zone program are built out. As these rules 
are developed, we want to ensure they are considerate of the unique 
situations and circumstances surrounding trust land and resources in 
Indian Country.
    Tribes deserve equal footing and access to Opportunity Zones and I 
am committed to working with the Committee, Treasury, and tribal 
leaders to ensure that appropriate measures are taken to ensure tribes 
have the opportunity to develop their local economies and investors 
have the opportunity to choose Indian Country for their portfolios.
Native American Business Development Institute Grants
    Indian Affairs is also pushing out on-the-ground support for tribes 
and tribal businesses to take advantage of Opportunity Zones through 
the IEED--Division of Economic Development Native American Business 
Development Institute (NABDI) Grants. The IEED has funded tribes to 
conduct feasibility studies on business endeavors since 2007.
    These studies have made possible the Wells Band of the Te-Moak 
Tribe of Western Shoshone of Nevada's business incubator; the first 
tribal grocery store to be sourced with locally grown vegetables at the 
Ft. Belknap Reservation in Montana; and the burgeoning tourist industry 
of Alaska's Chilkat Indian Village, among other examples.
    For the FY 2019 feasibility study grant cycle, we have created a 
preference for tribal applicants focused on businesses or projects to 
be located in Opportunity Zones. This powerful new tax law will be a 
force multiplier for our economic development feasibility grants.
    We are convinced that a new tribal business or development project 
has the best chance of success when it is based on a feasibility study 
conducted by an impartial, expert third-party. Such studies identify 
technically implausible project proposals and logistical, financial and 
market challenges. Access to capital is an important component of 
economic development. Another is a credible feasibility study.
Business Development In Indian Country
    Small business is the lifeblood of community development. Small 
businesses are necessary to achieve the multiplier effect we strive for 
in Indian Country--where a dollar turns over 5, 6, or 7 times among 
community members before it leaves the local economy. Big deals with 
large corporations are great, but small business development often 
plays the most pivotal role in changing the lives of local citizens.
    We want healthy economic environments in Indian Country that 
support small business--which means a number of the items we have 
already discussed: access to capital, feasibility determinations, but 
it also requires a legal and regulatory regime that supports and 
protects secured transactions in Indian Country.
Building Transactional Capacity In Tribal Communities
Uniform Commercial Code and Model Codes
    Finally, we are helping Tribes develop legal infrastructure that is 
indispensable to economic progress. According to John Koppisch, writing 
in Forbes Magazine.

        ``Companies and investors are often reluctant to do business on 
        reservations--everything from signing up fast food franchisees 
        to lending to casino projects--because. . .commercial codes 
        aren't well developed. . .'' \4\
---------------------------------------------------------------------------
    \4\ John Koppisch, ``Why Are Indian Reservations So Poor? A Look at 
the Bottom 1 percent,'' Forbes Magazine, December 13, 2011.

    Most Tribes lack commercial codes to secure collateral and assure 
access to credit. Without such codes, Native business persons are 
unable to finance the purchase of business-related equipment from 
sellers located outside tribal jurisdictions. Tribal members are often 
unable to obtain credit for the purchase of equipment and business 
goods off the reservation because a dealer cannot enforce his or her 
lien (or security interest) in the purchased item once it has been 
transported to the reservation. Without these codes and an accurate, 
accessible system for filing claims, creditors may increase borrowing 
costs to offset risks or refuse to lend altogether.
    To address this challenge, the National Conference of Commissioners 
on Uniform State Laws (NCCUSL) and a working group of tribal officials 
drafted the Model Tribal Secured Transaction Act (MTSTA) as a template 
for legislation by tribes to facilitate transactions with outside 
lenders and businesses. \5\
---------------------------------------------------------------------------
    \5\ NCCUSL joined with the American Law Institute to create the 
Uniform Commercial Code in 1940, providing a comprehensive solution to 
conflicting state commercial codes.
---------------------------------------------------------------------------
    The MTSTA provides a set of rules that specify how security 
interests may be created, perfected, and enforced, and who has first 
rights when two or more competing creditors have legally enforceable 
interests in the same collateral. Under this system, a creditor files a 
financing statement at a public filing office that constitutes notice 
to other interested parties about security interests in the personal 
property of the debtor. This financing statement perfects (or makes 
good against third parties) a creditor's security interest in most 
kinds of personal property.
    Once filed, a financing statement notifies the public that the 
secured party may have a lien on specified personal property of a 
particular debtor. Most states use the Secretary of State's office to 
administer these filings. Interested parties may search filing records 
there or online to determine whether certain personal property of a 
debtor may be subject to a prior lien or liens.
    Tribal adoption of the MTSTA has long been a priority for IEED and 
it has funded tribes to explore adoption of commercial law codes 
modeled on the MTSTA. It has also prepared and placed on its website a 
detailed primer, ``Why Tribes Should Adopt a Secured Transactions 
Code.'' \6\
---------------------------------------------------------------------------
    \6\ https://www.bia.gov/sites/bia.gov/files/assets/as-ia/ieed/pdf/
Why%20Tribes%20Should%20Adopt%20a%20Secured%20Transactions%20Code%2011.3
0.18.pdf
---------------------------------------------------------------------------
Conclusion
    Indian Affairs is committed to moving the needle in Indian Country 
on many fronts, and economic development and growth is a top priority 
for me and my team. While we continue to make strides with our 
programs, more can be done to promote sustainable economies in Indian 
Country. I am also committed to working with this committee, members of 
Congress and across the Administration to develop an economic roadmap 
for Indian Country development and growth.
    Thank you for the opportunity to provide testimony, and I'm happy 
to answer the Committee's questions.

    The Chairman. Thank you, Secretary Sweeney.
    I do have to ask why you did not get your testimony in 
within the 48 hours?
    Ms. Sweeney. My apologies to the Committee. I was late in 
drafting the entire document so it was going through the review 
process.
    The Chairman. We would ask that you observe the 48 hour 
rule. Thank you.
    I have the same question, Ms. Harris, and then proceed with 
your testimony.

        STATEMENT OF JODIE HARRIS, DIRECTOR, COMMUNITY 
         DEVELOPMENT FINANCIAL INSTITUTIONS FUND, U.S. 
                   DEPARTMENT OF THE TREASURY

    Ms. Harris. Chairman Hoeven, Vice Chairman Udall and 
members of the Committee, thank you very much for the 
opportunity to testify before you this afternoon.
    My name is Jodie Harris. I am the Director, Community 
Development Financial Institutions Fund. I am honored to be 
here to speak with you about the CDFI Fund's work providing 
community development finance resources to support development 
activities in Indian Country.
    For those of you that may not be familiar with us, the CDFI 
Fund was created in 1994 to provide access to credit and 
capital in distressed and underserved areas unable to tap into 
lending or investments from traditional financial service 
providers. The CDFI Fund was established to build and invest in 
a network of community-based members known as Community 
Development Financial Institutions, CDFIs, to support a wide 
array of community finance needs.
    What makes the CDFI Fund unique is it does not invest in 
specific projects or provide pas through or formula funds to 
State and local governments, as is the model for most other 
Federal community and economic development programs.
    Instead, we invest in organizations at the enterprise 
level. We do this by evaluating the strength of business plans 
and management teams and then we inject flexible capital in 
CDFIs that empowers them to take risks, innovate and build the 
financial strength of their communities.
    Activities financed and supported by CDFIs include micro 
and small business enterprises, consumer savings and lending 
programs, community services and facilities, commercial real 
estate, and affordable housing development. Specific to Indian 
Country, the CDFI Fund designates CDFIs that perform more than 
50 percent of their activities in majority Native American, 
Alaska Native or Native Hawaiian communities as Native CDFIs. 
Currently, there are 68 certified Native CDFIs nationwide.
    The origin of the CDFI Fund's focus on Native communities 
traces back to 1994 when Congress mandated the completion of a 
study on lending and investment practices in Native 
communities. Released in 2001, the study examined the barriers 
faced by Native communities in accessing capital and basic 
financial services, as well as the increased challenges in 
tapping into private and public sector programs.
    From the study, the Native CDFI Assistance, NACA Program, 
was born to support the creation and expansion of Native CDFIs. 
The NACA Program has made some significant inroads and 
generated considerable results. From fiscal year 2010 to 2018, 
the NACA Program award recipients originated nearly $620 
million in loans and investments. In addition, nearly 174,000 
individuals have benefitted from financial literacy and 
training programs.
    Despite the progress made through the NACA Program, capital 
and credit needs in Native communities are high. Access to 
banking services and products remain a consistent challenge.
    In May 2016, a follow-up report to the 2001 report was 
completed. It showed the scope and scale of existing hurdles. 
Some of the report findings included while the supply of 
capital has increased, it has not kept pace with the demand and 
need for capital; per capital income levels in Native 
communities is less than half of what it is in non-Native 
communities; and credit scores tend to be lower in Native 
communities, which leads to lower home ownership rates.
    In order to overcome these barriers and increase access to 
credit, capital and financial services in Native communities 
and to further support Native CDFIs' abilities to generate 
impact in the communities they serve, the CDFI Fund has re-
launched the Building Native CDFIs Sustainability and Impact 
Training and Technical Assistance Series offered through our 
Capacity Building Initiative. The training is intended to 
provide Native CDFIs tools to enhance their management and 
operational capacity as well as show casing Native CDFI best 
practices such as underwriting processes, board management, 
strategic planning and portfolio management.
    Through the Capacity Building Initiative, we hope to 
increase the capacity of Native CDFIs to access CDFI Fund 
programs beyond NACA, as well as develop capital resources 
outside of the CDFI Fund. While the CDFI Fund's Native 
initiatives have helped most the needle, we recognize that more 
work remains. The CDFI Fund hopes that its renewed focus on 
capacity building can help move the needle even further.
    Again, thank you for the opportunity to appear before you 
this afternoon. I look forward to answering any questions.
    In response to your question about the testimony, we were 
verifying the data late into Monday and we sent it over on 
Monday evening. My apologies for missing the 48-hour window.
    [The prepared statement of Ms. Harris follows:]

  Prepared Statement of Jodie Harris, Director, Community Development 
      Financial Institutions Fund, U.S. Department of the Treasury
Introduction
    Chairman Hoeven, Vice Chairman Udall, and Members of the Committee: 
thank you for the opportunity to testify during today's hearing 
entitled ``Building out Indian Country: Tools for Community 
Development.'' My name is Jodie Harris. I am Director of the U.S. 
Treasury Department's Community Development Financial Institutions Fund 
(CDFI Fund).
    The CDFI Fund's vision is an America in which all people and 
communities have access to the investment capital and financial 
services they need to prosper. In order to help achieve that vision, 
the CDFI Fund's mission is to expand economic opportunity for 
underserved people and communities by supporting the growth and 
capacity of a national network of community development lenders, 
investors, and financial service providers.
About the CDFI Fund
    Established by the Riegle Community Development and Regulatory 
Improvement Act of 1994 (Riegle Act; P.L. 103-325), the CDFI Fund has 
worked for more than two decades to generate economic opportunity in 
places where opportunity is needed most.
    The CDFI Fund works to spur economic growth, job creation, and 
opportunity in the nation's distressed and underserved communities by 
offering targeted resources and innovative programs to leverage federal 
dollars with private sector capital. The CDFI Fund supports mission-
driven financial institutions that take a market-based approach to 
supporting economically underserved communities. These financial 
institutions are encouraged to apply for certification as Community 
Development Financial Institutions (CDFIs).
    Since its inception, the CDFI Fund has awarded more than $3.3 
billion to community development organizations and financial 
institutions; guaranteed $1.5 billion in bonds through the Bond 
Guarantee Program; and allocated $54 billion in New Markets Tax 
Credits. These awards have leveraged billions of dollars in private 
sector investment and increased the impact of CDFIs, CDEs, and other 
community-based development organizations by expanding their capacity 
to deliver the credit, capital, and financial services needed to 
generate economic opportunity in underserved communities. While the 
President's Budget for FY 2020 does not propose additional funding for 
CDFI award programs, we are working hard to ensure that available funds 
are deployed as quickly and effectively as possible.
About CDFIs
    CDFIs are community-based financial institutions that have a common 
goal of filling financing gaps in underserved and low-income areas. As 
community-based institutions, they possess a keen sensitivity to the 
needs of local residents and businesses, and their creation reflects a 
bottom-up, rather than a top-down, approach to community investment and 
revitalization.
    Currently, there are nearly 1,100 CDFIs serving urban and rural 
communities throughout the United States. CDFIs are located in all 50 
states, the District of Columbia, Guam, and Puerto Rico. They bridge 
diverse public and private sector interests to serve people and places 
that traditional financial institutions usually do not. CDFIs typically 
provide:

   Loans for businesses and projects that otherwise would not 
        qualify for financing;

   Safe and affordable banking services that otherwise would 
        not be available in the community;

   Loan rates and terms that are more flexible than those 
        offered by traditional lenders; and

   Development services--such as business planning, credit 
        counseling, and homebuyer education--to help their borrowers 
        use credit effectively and build financial strength.

The CDFI Fund's Native Initiatives
    Native Communities, including Native American, Alaskan Native, and 
Native Hawaiian communities, often face formidable barriers to 
accessing capital and basic financial services. The CDFI Fund's Native 
Initiatives generates economic opportunity for Native Communities by 
supporting the creation and expansion of Native CDFIs, which in turn 
help create jobs, establish or improve affordable housing, and provide 
supportive financial services and counseling within their communities.
    The origins of the CDFI Fund's focus on Native Communities trace 
back to 1994 when Congress mandated the completion of a study (as part 
of its passage of the Riegle Act) on lending and investment practices 
in Native Communities. Released in 2001, the ``Native American Lending 
Study'' \1\ examined the barriers faced by Native communities in 
accessing capital and basic financial services, as well as the 
increased challenges in tapping into private and public sector 
programs.
---------------------------------------------------------------------------
    \1\ https://www.cdfifund.gov/Documents/2001_nacta_lending_study.pdf
---------------------------------------------------------------------------
    The study affirmed the importance of developing Native CDFIs--CDFIs 
that specialize in serving Native Communities--to play a key role in 
the broader effort to lead Native Communities into the nation's 
economic mainstream. After this study, the Native CDFI Assistance 
Program (NACA Program) was launched to support the creation and 
expansion of Native CDFIs.
    An organization must be certified as a CDFI and primarily serve a 
Native Community to be eligible for Financial Assistance through the 
NACA Program. Technical Assistance is available to both Native CDFIs 
and emerging Native CDFIs (those on the path to certification). To be 
eligible for Native CDFI certification, at least 50 percent of an 
organization's activities must serve Native Americans, Alaska Natives, 
or Native Hawaiians.
    The NACA Program has made some significant inroads and generated 
substantive results in increasing the availability of credit and 
capital in Native Communities. From FY 2010 to FY 2018, NACA Program 
award recipients originated nearly $620 million in loans and 
investments. Of this amount, more than $312 million was dedicated to 
business and microenterprise loans and investments, financing more than 
1,600 businesses; and more than $117 million was for home purchases or 
home improvement financing. \2\ In addition, nearly 174,000 individuals 
have been served by financial literacy and training programs. Examples 
of ways in which Native CDFIs are providing access to capital and 
credit include:
---------------------------------------------------------------------------
    \2\ FY 2018 CDFI Fund Agency Financial Report

   Citizen Potawatomi Community Development Corporation 
        (Shawnee, OK), a certified Native CDFI, provided a loan of more 
        than $40,000 to DC Cake Appeal, a small catering and baking 
        businesses owned by a tribal member, to help them expand their 
        business. The loan allowed the owners to move their home-based 
        business into a 4,000 square foot facility, which boasts a 
        commercial kitchen and serves as restaurant, bakery and event 
        space. The loan also helped create seven jobs in a small 
---------------------------------------------------------------------------
        community.

   Native 360 Loan Fund, Inc. (Grand Island, NE), a certified 
        Native CDFI, provided financing to Native-owned startup 
        Cherry's Native Creations (Norfolk, NE), which sells genuine 
        Native-made handicrafts. The financing allowed Cherry's to 
        acquire inventory, grow their operations and expand their 
        business overseas.

   Certified Native CDFI Four Directions Development 
        Corporation (Orono, ME) recently announced it was partnering 
        with Wells Fargo & Company to provide a home down payment 
        assistance program aimed at homeownership opportunities for 
        Native Americans in Maine. Four Directions will provide up to 
        $5,000 in down payment assistance to tribal members to help 
        address low rates of homeownership of Native Americans in 
        Native Communities in the state.

Access to Capital and Credit in Native Communities
    Despite the inroads made by the NACA Program, capital and credit 
needs in Native Communities are high, and access to banking services 
and products remain a consistent challenge. In May 2016, the CDFI Fund 
released a follow-up to the 2001 report, entitled ``Access to Capital 
and Credit in Native Communities.'' \3\ It showed the scope and scale 
of existing hurdles. Some of the key report findings include:
---------------------------------------------------------------------------
    \3\ https://www.cdfifund.gov/programs-training/Programs/native-
initiatives/Pages/native-communities-study.aspx 

   While the supply of capital has increased, it has not kept 
---------------------------------------------------------------------------
        pace with the demand and need for capital;

   Per capita income levels in Native Communities are less than 
        half of what they are in Non-Native Communities--and are not 
        expected to catch up for more than 40 years based on data 
        compiled in the Access to Capital report; and

   Credit scores tend to be lower in Native Communities, which 
        leads to lower homeownership rates.

    A recent survey \4\ of Native CDFIs conducted by First Nations 
Oweesta Corporation also highlights that many Native CDFIs remain 
undercapitalized and that engagement with traditional lending sources 
remains low. This is also supported by a separate survey conducted by 
the Minneapolis Federal Reserve Bank's Center for Indian Country 
Development, where Native CDFIs reported an additional $48 million in 
unmet funding needs from public and private sources for in 2017 alone. 
\5\
---------------------------------------------------------------------------
    \4\ First Nations Oweesta Corporation, ``Native CDFI Industry 
Profile 2017''
    \5\ Michou Kokodo, ``Findings from the 2017 Native CDFI Survey: 
Industry Opportunities and Limitations.'' Federal Reserve Bank of 
Minneapolis, Working Paper No. 2017-04, November 2017
---------------------------------------------------------------------------
    And finally in 2017, the First Nations Development Institute and 
the FINRA Investor Education Foundation released a report \6\ on 
financial capability in American Indian and Alaska Native Communities, 
indicating that Native Americans and Alaskan Natives:
---------------------------------------------------------------------------
    \6\  FINRA Investor Education Foundation and First Nations 
Development Institute, ``Race and Financial Capability in America: 
Understanding the Native American Experience,'' August 2017

   Among all groups, have higher levels of financial fragility 
---------------------------------------------------------------------------
        and distress;

   Are the least likely to have an emergency savings fund in 
        place; and

   Are less likely to have savings and checking accounts than 
        other groups.

    This research emphasizes that while much has been accomplished in 
the years since the ``Native American Lending Study'' was completed, 
there is also much more to be done to provide access to credit and 
capital in Native American Communities.
Fostering Innovation and Building Capacity in Native Communities
    While the NACA Program supplies an important tranche of capital for 
Native Communities, it should not be the only path that a Native CDFI, 
or an organization that is aspiring to become a certified CDFI, can 
pursue in developing and expanding its lending capabilities. Developing 
the capacity of Native CDFIs to effectively compete for funding through 
other CDFI Fund programs, and developing capital sources outside of the 
CDFI Fund, are of critical importance. The impact of Native CDFIs can 
be elevated and multiplied through innovative partnerships and 
initiatives between Native CDFIs, financial and philanthropic 
institutions, and other non-Native CDFIs. For example:

   Mazaska Owecaso Otipi Financial, Inc. (Pine Ridge, SD) and 
        Lakota Funds (Kyle, SD), both certified Native CDFIs, have 
        partnered to increase homeownership rates for Native American 
        veterans. Mazaska provides a construction loan to the veteran 
        and then assists them in refinancing through a U.S. Department 
        of Veterans Affairs Native American Direct Loan after the home 
        is built. Mazaska and Lakota Funds work together to provide 
        homebuyer education and support, and to coordinate with the 
        U.S. Department of Veterans Affairs to convert the construction 
        loan to permanent financing.

   Mazaska was also recently chosen-along with certified Native 
        CDFI Four Bands Community Fund (Eagle Butte, SD)--by the U.S. 
        Department of Agriculture (USDA) to participate in a Section 
        502 relending pilot program on tribal lands to help low-income 
        families pursue home ownership. Under the pilot, USDA provided 
        each CDFI with $800,000 in funding, which each CDFI matched 
        with $200,000, to relend to Native American families in Native 
        Communities in South Dakota and North Dakota.

   In spring of 2018, First Nations Oweesta Corporation 
        (Longmont, CO), a national Native CDFI intermediary, launched a 
        $10 million Native CDFI Capital Pool to exclusively fund the 
        capital needs of Native CDFIs. The pool is intended to leverage 
        larger amounts of lending capital for Native CDFIs who invest 
        in the pool. They are able to receive up to $1 million in 
        capital--either in loans or in a loan/grant combination. 13 
        Native CDFIs contributed to a shared-risk pool, to which 
        Oweesta provided matching resources. The Capital Pool was 
        capitalized by loan and grant resources from a number of 
        philanthropic and financial institutions. All $10 million from 
        the Capital Pool has been deployed to support a variety of 
        housing, consumer, and small business lending activity. The 
        Capital Pool is designed to leverage the capacity and 
        relationships between Native CDFIs to provide access to long-
        term low-cost capital.

   Clearinghouse CDFI (Lake Forest, CA), a non-Native CDFI, 
        seeks out value-added partnerships with Native CDFIs to fund 
        projects that Native CDFIs could not finance alone due to 
        limited capital. In total, Clearinghouse has deployed roughly 
        $65 million to projects in Native American communities. To help 
        them development partnerships and collaborative opportunities, 
        Clearinghouse established a Native American advisory board--
        which includes Native CDFIs and Native-owned businesses--that 
        meets quarterly to discuss opportunities and challenges in 
        Indian country.

   Midwest Minnesota Community Development Corporation (MMCDC) 
        (Detroit Lakes, MN) created a subsidiary Native CDFI: the White 
        Earth Investment Initiative, which focuses on development in 
        and around the White Earth Reservation in Northwest Minnesota 
        as well as lending in Native American Communities across 
        Minnesota. In addition, because the White Earth reservation is 
        within MMCDC's target market, there is one seat reserved on 
        MMCDC's board for a tribal appointee, and they also have 
        another elected member from the White Earth Reservation.

   The Metlaka Indian Community in Alaska worked with Tongass 
        Federal Credit Union (FCU) (Ketchikan, AK), a certified CDFI, 
        to establish a financial services and banking presence on the 
        remote island community after the area's only bank branch 
        closed in 2005. Tongass FCU began offering services once a week 
        at the Metlakatla Indian Community council chambers in the 
        summer of 2005. Tongass FCU established a local advisory board 
        for the Metlakatla branch, which helped the credit union 
        develop and target its services to the community. In 2012, 
        Tongass FCU completed a new branch building in Metlakatla. The 
        new branch is staffed by six employees who are all from the 
        Metlakatla Indian Community.

    To achieve higher levels of innovation, increased capital access, 
and to further support Native CDFIs' abilities to increase their impact 
in the communities they serve, the CDFI Fund has relaunched the 
``Building Native CDFIs' Sustainability and Impact'' training and 
technical assistance series offered through our Capacity Building 
Initiative.
    The training is designed to provide Native CDFIs tools to enhance 
their management and operational capacity, as well as to showcase 
Native CDFI best practices (such as underwriting processes, board 
management, strategic planning and portfolio management). Native CDFIs 
and similar organizations that join this initiative will have access 
to:

   Individualized technical assistance, focused on addressing 
        their organization's specific capacity building needs;

   In-person workshops that bring together Native CDFIs and 
        similar organizations from across the country for knowledge 
        sharing, skill building, and practical action planning (with 
        scholarships available for travel and lodging costs);

   Webinars on a variety of topics related to sustainability 
        and impact; and

   Peer learning opportunities.

    In addition to this, the CDFI Fund has worked to reduce impediments 
to accessing NACA Program resources. In 2017, the application for NACA 
Program Financial Assistance and Technical Assistance was revamped. 
This restructured application has reduced the burden to apply for 
assistance, and has provided applicants a better opportunity to 
accurately describe their organization and the impact they can make 
with an award.
Conclusion
    Last week, the CDFI Fund opened the fiscal year 2019 application 
round of the NACA Program, for which we anticipate awarding nearly $14 
million in Financial Assistance and Technical Assistance awards. We are 
confident these awards will increase the capacity of Native CDFIs, and 
organizations seeking to become certified CDFIs, to provide access to 
capital and critical community revitalization initiatives.
    While the CDFI Fund acknowledges the substantial challenges and 
impediments that remain to accessing capital and credit in Native 
Communities, we are optimistic about the track record of impact and 
achievements of Native CDFIs. Last year alone, NACA Program awardees 
originated more than $75 million in loans and investments, which is an 
indicator of their potential for future success. The CDFI Fund remains 
committed to developing the capacity of Native CDFIs and increasing 
access to credit and capital in our nation's Native Communities.
    Chairman Hoeven, Vice Chairman Udall, and Members of the Committee, 
this concludes my statement. I thank you for the opportunity to 
testify. I look forward to taking your questions.

    The Chairman. Thank you, Ms. Harris.
    Mr. Childs.
    Mr. Childs. Before I begin my testimony, I want to 
apologize for missing the 48-hour rule. This testimony is very 
important. The issue will be addressed and it will not happen 
again. Thank you.
    The Chairman. Thank you.

       STATEMENT OF HENRY CHILDS II, NATIONAL DIRECTOR, 
          MINORITY BUSINESS DEVELOPMENT AGENCY, U.S. 
                     DEPARTMENT OF COMMERCE

    Mr. Childs. Thank you, Chairman Hoeven, Ranking Member 
Udall, and members of the Committee for the opportunity to 
appear before you today. I am honored to testify on behalf of 
the Minority Business Development Administration in the 
Department of Commerce.
    Since my appointment as National Director, I have been 
laser focused on developing the 11 million minority businesses 
across the United States. Secretary Ross and I are working to 
implement the Administration's plan to modernize MBDA for the 
future through technology, market-driven business development 
programs, and leveraging data, policy and strategic 
partnerships.
    Between fiscal years 2012 and 2017, MBDA invested $8.7 
million in MBDA business centers in Indian Country. During this 
five year award period, these business centers secured more 
than $3.6 billion in contracts and capital for their clients, 
leading to the creation and/or retention of over 14,400 jobs.
    In fiscal year 2017, MBDA undertook a series of tribal 
cultural consultations to better understand the needs of Indian 
Country. We also conducted our first ever listening session 
with Native Hawaiian businesses, organizations, community 
leaders and other stakeholders. I am very proud of that.
    The overarching lessons learned from the tribal 
consultations can be summarized in the following themes. One 
size does not fit all is number one. The importance of tribal 
sovereignty is number two. The need for MBDA to better educate 
and advocate is number three. The need to leverage technology 
to provide resources and tools is number four.
    These tribal consultations helped MBDA envision a new 
approach to business development in Indian Country involving 
more flexible competitive grant competitions. I am very happy 
with the results. This new approach eliminated the non-Federal 
cost share, provided greater flexibility to grant recipients 
and reduced the administrative and programmatic burden 
associated with traditional MBDA business centers.
    In 2018, we issued a broad agency announcement to solicit 
innovative solutions to common business development needs 
identified during the tribal consultations. We received more 
than 40 grant applications specific to Indian Country 
requesting upwards of $20 million funding.
    MBDA made ten awards totaling $3.2 million. That is three 
times the dollar investment we made in the previous year with 
the business center model and double the number of grant 
recipients.
    This spring I am proud to announce MBDA will be releasing a 
Notice of Federal Funding Opportunity to solicit special 
projects and programs for the American Indian, Alaska Native, 
and Native Hawaiian communities. I welcome this Committee's 
support for and your assistance with promoting our agency 
announcement.
    Again, I am very passionate about MBDA's mission and the 
role we serve in growing and developing minority businesses, 
especially in Indian Country.
    Thank you again, Mr. Chairman, Ranking Member Udall and 
members of the Committee for the opportunity to testify today.
    [The prepared statement of Mr. Childs follows:]

  Prepared Statement of Henry Childs II, National Director, Minority 
        Business Development Agency, U.S. Department of Commerce
Introduction
    Thank you Chairman Hoeven, Ranking Member Udall, and members of the 
Committee for the opportunity to appear before you today. I am honored 
to appear before you today to testify on behalf of the Minority 
Business Development Agency (MBDA) in the Department of Commerce. 
Bipartisan congressional support over the years has contributed to 
MBDA's success in fostering minority business development since 1969. 
We welcome this hearing as an opportunity to discuss the tools MBDA has 
available to support community development in Indian Country.
    Since my appointment as MBDA National Director, I have placed a 
great deal of emphasis on implementing transformative initiatives to 
increase MBDA's impact on Minority Business Enterprises (MBEs). 
Secretary Ross and I are working to implement the Administration's plan 
to modernize MBDA for the future through technology, market-driven 
business development programs, and leveraging data, policy and 
strategic partnerships. Specifically, the Administration seeks to 
increase the number of minority-owned firms with annual gross receipts 
of a million dollars or more from 2 percent to 3 percent over the next 
five years.
MBDA in Indian Country
    It is estimated there are more than 11 million minority-owned firms 
in the U.S., approximately 273,000 of which are American Indian and 
Alaska Native-owned firms. \1\ MBDA has a strong track record of 
working in Indian Country to promote economic empowerment and self-
determination through entrepreneurship. Historically, MBDA's primary 
service delivery model has been through brick and mortar business 
centers that provide management and technical assistance to reach 
American Indian and Alaska Native business owners. MBDA business 
centers are operated by third party stakeholders who compete for an 
MBDA grant and enter into a cooperative agreement with MBDA to achieve 
distinct performance metrics.
---------------------------------------------------------------------------
    \1\ U.S. Census Bureau, 2012 Survey of Business Owners
---------------------------------------------------------------------------
    Because MBDA is focused on achieving strategic economic impact, 
MBDA steers its business centers to primarily serve minority businesses 
with revenues of a million dollars or more, and/or businesses with 
rapid growth potential. Between fiscal year 2012 and fiscal year 2017, 
MBDA invested $8.7 million in MBDA Business Centers in Indian Country. 
During this five-year award period, these business centers secured more 
than $3.6 billion in contracts and capital for their clients, leading 
to the creation and/or retention of over 14,400 jobs. The grant cycle 
for these five MBDA Business Centers in Indian Country came to an end 
in FY 2018.
Lessons Learned: Tribal Consultations
    It is MBDA's standard operating procedure to reevaluate its service 
delivery model at the natural conclusion of the business centers' 
multi-year grant cycle. MBDA undertook a series of tribal consultations 
between November 2016 and February 2017 in anticipation of the grant 
cycle coming to an end for the MBDA Business Centers in Indian Country.
    Five tribal consultations were conducted between MBDA and federally 
recognized tribes, American Indian and Alaska Native business/trade/
economic organizations, and American Indian and Alaska Native-owned 
firms. To supplement our tribal consultations, MBDA also conducted its 
first listening session with Native Hawai`ian businesses, 
organizations, community leaders, and other stakeholders.
    The purpose of the tribal consultations is to provide an 
opportunity for tribal leaders to provide their input on how MBDA could 
better provide business development services and programs in Indian 
country as the Agency considered how, and whether, to structure a new 
grant opportunity for Indian Country in lieu of the current MBDA 
Business Center program. The information gathered from these 
consultations was informative. Overarching lessons learned from the 
tribal consultations can be synthesized into the following themes:

        1.  One-size does not fit all: A uniform approach to business 
        development in Indian Country constrains creative approaches to 
        localized needs. Prescriptive criteria for the type of firms to 
        serve and strict performance outcomes limit impact and 
        potential. MBDA marketing and outreach materials should also be 
        culturally relevant to specific American Indian, Alaska Native, 
        and Native Hawai`ian communities.

        2.  Tribal sovereignty: Recognize and honor the unique 
        political relationships Tribes have with the United States 
        Government; and the legal differences between Tribes, Alaska 
        Native Corporations, Alaska Villages and Native Hawai`ians.

        3.  Advocate and educate: MBDA can serve an important role as a 
        champion for American Indian, Alaska Native, and Native 
        Hawai`ian communities with other federal agencies, policy 
        makers and public servants. Conversely, MBDA can provide high 
        level business development training to Tribal Board members.

        4.  Leverage technology: Minimize the time and cost of business 
        education, coaching and technical assistance by providing more 
        resources and tools on-line through web and cloud-based 
        platforms, webinars, teleconferences and mobile devices.

    The most common business development needs cited during the tribal 
consultations were access to capital, business training, coaching on 
federal procurement, business incubator and accelerator programs, and 
infrastructure enhancements.
Flexible Grants
    These tribal consultations helped MBDA envision a new approach to 
business development in Indian Country involving more flexible 
competitive grant competitions. This new approach would eliminate the 
non-Federal cost share, provide greater flexibility to grant 
recipients, and reduce the administrative and programmatic burden 
associated with traditional MBDA Business Centers.
    In 2018, we issued a competitive grant competition to solicit 
innovative solutions to common business development needs in Indian 
Country that were identified during the tribal consultations. We 
received more than 40 grant applications specific to Indian Country 
requesting upwards of $20 million in funding. As a result of the grant 
solicitation, MBDA made 10 awards totaling $3.2 million. (See 
Attachment A for a list of the specific awards). This represents almost 
3 times the dollar investment made in Indian Country compared to the 
year before under the MBDA Business Center model; and double the number 
of grant recipients. Let me share with you three projects that 
illustrate Native-inspired solutions:

        1.  United Tribes Technical College (UTTC), located in Bismarck 
        ND, previously operated a MBDA business center and only 
        provided services to individual business owners. Today, with 
        less prescriptive program requirements and performance metrics, 
        UTTC has diversified its approach and is now working with 12 
        Tribal Nations in the Great Plains region to maximize Tribal, 
        state and Federal resources and opportunities for economic 
        development on a larger scale. This is in addition to UTTC's 
        work assisting a portfolio of established business enterprises 
        with management and technical assistance; and helping new 
        start-up businesses obtain capital.

        2.  The American Indian Science and Engineering Society (AISES) 
        in Albuquerque, NM is focused on developing the next generation 
        of Native American entrepreneurs interested in developing STEM-
        related businesses in Arizona, Nevada and Utah. With funds from 
        MBDA and other sources, the AISES is coaching, training, and 
        assisting a cohort of 24 Native STEM graduates and/or 
        professionals with entrepreneurial and business management 
        skills. An additional benefit of this program is the access it 
        provides to business experts, resources and tools.

        3.  The National Center for American Indian Enterprise 
        Development in Mesa, AZ is using funds from MBDA to broaden its 
        reach to Native Americans located in the East Coast through 
        one-day institutes and its on-line business ecosystem, known as 
        the Native Edge. By recruiting more Native firms to the Native 
        Edge, the project fosters Native-to-Native business exchanges, 
        employment, and access to procurement and capital 
        opportunities.

    We are very pleased with the work being performed by the grant 
recipients and look forward to reviewing their semi-annual reports.
    In FY 2019, MBDA will continue supporting business development in 
Indian Country using a similar approach. We will be releasing a Notice 
of Federal Funding Opportunity to solicit special projects and programs 
to address common business development needs within the American 
Indian, Alaska Native, and Native Hawai`ian communities this spring. I 
welcome this Committee's support for our new approach and your 
assistance with promoting our competitive grant programs. We are eager 
to make investments that will have a positive impact in Indian Country.
MBDA's Office of Policy Analysis and Development
    Another way MBDA can impact more MBEs is through its work as a 
policy, research and advocacy authority. Since Congress approved MBDA's 
request to establish an Office of Policy Analysis and Development 
(OPAD), we have been working to operationalize the new unit. Last 
October, MBDA produced the State of Minority Business report based on 
the results of the Census Bureau's 2012 Survey of Business Owners and 
data from the Annual Survey of Entrepreneurs. We also launched a data 
visualization tool on our website that allows visitors to see key 
statistics about the number of minority-owned firms in each state, by 
race and ethnicity. OPAD is responsible for promoting MBDA's domestic 
economic growth and job creation agenda by providing data and research, 
in-depth analysis, and comprehensive policy recommendations for 
minority business development based on economic and industry trends. 
Conducting data analyses about American Indian, Alaska Native and 
Native Hawai`ian (AIANNH) businesses and producing special reports of 
interest to AIANNHs is expected.
MBDA's Virtual Business Center
    MBDA is also taking steps to better leverage technology through its 
Virtual Business Center (VBC). The VBC serves as a virtual platform for 
strategic partners to provide services to minority-owned businesses. 
This approach is a natural evolution of how MBDA provides management 
and technical assistance to an ever-expanding base of minority business 
enterprises. The VBC supports MBDA's mission by ensuring MBEs, 
regardless of geographic location, gain greater access to the products 
and services that support their growth and development.
The Office of Native American Business Development
    Additional strategies and tools for advancing economic development 
in Indian Country were made available by this Committee when it passed 
the Native American Business Development, Trade Promotion, and Tourism 
Act of 2000, which later became Public Law 106-464. Although funds were 
never appropriated to establish the Office of Native American Business 
Development (ONABD) at the Department of Commerce, nor was it stood up 
as envisioned by Public Law 106-464, many of the programmatic 
objectives have since been provided by MBDA, the Economic Development 
Administration, the International Trade Administration, the U.S. Census 
Bureau, and other Department of Commerce bureaus. Between 2005 and 
2013, MBDA utilized funds from its base budget to staff ONABD with a 
director through an expert consultant appointment. The ONABD director's 
primary role was to work directly with American Indian tribes, Alaska 
Native Corporations, and AIAN firms; and to collaborate with Department 
of Commerce Bureaus and other federal agencies.
    I understand this Committee, particularly Chairman Hoeven, has a 
special interest in the Office of Native American Business Development, 
and I would like the Committee to know that I am working with Secretary 
Ross and the Department to restore the director position and revive the 
ONABD. I welcome the opportunity to work with you on this shared 
priority.
MBDA: Winning the Future
    With the number of minority-owned growing firms that gross over a 
million dollars in annual revenues stalled at 2 percent, the work MBDA 
does to build more firms of size and scale is even more important than 
it was when the MBDA was founded 50 years ago. Firms that cross the 
million dollar revenue threshold are poised to have a positive impact 
in their communities through job creation. Further, firms of size and 
scale expand the tax base making it possible for towns, cities, and 
states to provide much needed infrastructure to their citizens. This is 
no more evident than in Indian Country where tribal members are 
yearning for economic prosperity.
    That is why I am passionate about MBDA's mission and the potential 
we have to make a difference in the lives of the American people. Thank 
you again, Mr. Chairman, Ranking Member Udall, and members of the 
Committee for the opportunity to testify today.
    Attachment A

   FY 2018--MBDA Broad Agency Announcement Grant Recipients--American
             Indian-Alaska Native-Native Hawai`ian Projects
------------------------------------------------------------------------
  Organization's      Project
       Name         Coordinator      Address       City      ST     Zip
------------------------------------------------------------------------
American Indian    Sarah          4263          Albuquerqu  NM     87109
 Science and        EchoHawk       Montgomery    e
 Engineering                       Blvd. N.E.
 Society                           Suite 200
Asian, Inc.        Michael Chan   1167 Mission  San         CA     94103
                                   Street, 4th   Francisco
                                   Floor
Council for        Danielle       91-1270       Kapolei     HI     96707
 Native Hawaii      Chavez         Kinoiki
 Advancement                       Street
Kauffman &         Joann          165 S.        Spokane     WA     99201
 Associates, Inc.   Kauffman       Howard St.,
                                   Suite 200
National Center    Christopher    953 E.        Mesa        AZ     85204
 for American       James          Juanita
 Indian                            Ave.
 Enterprise
 Development
New Mexico         Peter Holter   219 Central   Albuquerqu  NM     87102
 Community                         Ave. N.W.     e
 Capital                           Suite 200
Rural Community    Stanley        3120          W.          CA     95691
 Assistance         Keasling       Freeboard     Sacrament
 Corporation                       Dr.           o
Rural Enterprises  Scott Dewald   2912          Durant      OK     74701
 of Oklahoma,                      Enterprise
 Inc.                              Blvd.
United Tribes      Charles        3315          Bismarck    ND     58504
 Technical          Archambault    University
 College                           Dr.
University of      Rebecca Beck   3211          Anchorage   AK     99508
 Alaska-                           Providence
 Anchorage                         Drive
------------------------------------------------------------------------


    The Chairman. Thank you, Director Childs.
    Now we will turn to Ms. Ponti-Lazaruk.

         STATEMENT OF JACQUELINE PONTI-LAZARUK, CHIEF 
          INNOVATION OFFICER, RURAL DEVELOPMENT, U.S. 
                   DEPARTMENT OF AGRICULTURE

    Ms. Ponti-Lazaruk. Thank you and good afternoon, Chairman 
Hoeven, Vice Chairman Udall and members of the Committee.
    I appreciate the opportunity to represent USDA Rural 
Development to discuss how Native American tribes use our 
programs to deploy infrastructure and drive community and 
economic development.
    RD is a major driving force for economic development in 
rural America. We manage a loan and grant portfolio of over 
$225 billion administered by the Rural Utilities, Housing and 
Business Services. Together, they help communities build 
stronger economies, create jobs and improve the quality of life 
in rural America.
    In 2017, Secretary Purdue created the Innovation Center 
within RD, which I lead as the Chief Innovation Officer. A 
major part of what the IC does is analyze RD's performance, 
policies and strategies, and find ways to improve program 
delivery to all our customers. The IC is also charged with 
facilitating partnerships to advance our mission.
    RD is fully committed to building on past investments and 
improving our ongoing support to tribal Nations throughout 
Indian Country and Alaska. Since 2001, we have invested more 
than $6.2 billion in loans and grants that will benefit 
American Indians and Alaska Natives for years to come.
    Nearly half a billion was invested last year alone and has 
been deployed to support a variety of projects, projects like 
an early childhood development center and day care facility for 
the Spirit Lake Tribe in Fort Totten, North Dakota or a loan to 
Hopi Telecommunications in Arizona to bring higher speed 
broadband service to more than 650 tribal customers.
    We recognize some of the challenges faced by Indian Country 
are unique. Congress provided RD with tools to help drive 
investments to serve tribal areas. This includes tribal-
specific funding in six RD programs and the RUS SUTA provisions 
that enable eligible applicants in substantially underserved 
trust areas to seek special terms for certain projects.
    While the tribal-specific programs account for 
approximately $50 million in funded projects yearly, it is 
important to note that the vast majority of our investments 
flow through our core programs such as the $399 million 
invested in fiscal year 2018.
    RD's suite of programs enables us to serve customers at 
almost any stage of development. The variety of loan, grant and 
technical assistance products and services provide tribes and 
those who serve them with a path to investing and growing over 
time to provide critical services to their members.
    We understand providing access to broadband is a high 
priority for many tribal leaders. In the last eight years, RD 
has provided more than $600 million in loans and grants to 
support broadband infrastructure and services on tribal lands.
    RD's ReConnect Program is the most recent to offer 
broadband financing and includes priority points for applicants 
that serve tribal lands and to tribes. Eligible tribes can also 
invoke SUTA in this program. RD is hosting six ReConnect 
workshops around the Nation, one-third of which are located 
near tribal lands or at tribal venues.
    In addition to ReConnect, RD is beginning its work to 
implement the new broadband provisions in the Farm Bill. We 
will engage and listen to tribal perspectives as we implement 
these new provisions.
    For many tribal communities, understanding which RD 
programs meet their needs can be challenging. We provide 
technical assistance directly to tribes in collaboration with 
partners and through grants to private technical assistance 
providers. In addition to technical assistance, we are also 
continuously exploring ways in which we can more strategically 
engage our customers and deliver our programs.
    In RD's new Innovation Center, we are building our 
analytics capabilities to support more strategic engagement 
with tribes and other rural customers. We are also exploring 
new ways and approaches to improve program delivery.
    For example, we are stepping out of our traditional housing 
business model and piloting a new partnership with two Native 
community development financial institutions in an effort to 
increase homeownership on trust lands in parts of North and 
South Dakota.
    The 2018 Farm Bill offers us other opportunities to 
innovate and serve. It reauthorizes RD programs that support 
tribal economic development and provides new tools that will 
enable us to better serve the needs of tribal Nations. Big or 
small, these changes will make a real impact on program 
delivery.
    The New Farm Bill authorizes us to refinance certain 
hospital, telecommunications and electric loans. We understand 
that these authorities are of interest to tribal leaders and we 
look forward to engaging on this issue in the upcoming USDA 
Farm Bill consultations.
    We are also directed to establish a technical assistance 
program to improve tribal access to RD programs. We look 
forward to tribal consultation and listening sessions in the 
months ahead to hear how best to implement this section of the 
Farm Bill.
    We continue to actively support all tribal Nations in our 
efforts to improve the quality of life for their members. To do 
so, we will partner with public and private entities to fund 
projects, leverage the many tools and authorities Congress has 
provided to us, and work to provide faster, friendlier and more 
efficient service and access to all RD programs.
    Thank you for the opportunity to highlight our efforts 
today. I look forward to answering your questions.
    [The prepared statement of Ms. Ponti-Lazaruk follows:]

   Prepared Statement of Jacqueline Ponti-Lazaruk, Chief Innovation 
       Officer, Rural Development, U.S. Department of Agriculture
    Chairman Hoeven, Vice Chairman Udall and Members of the Committee, 
I appreciate this opportunity to represent USDA and to discuss our 
programs within Rural Development (RD), including how our nation's 
tribes utilize these programs to build out critical infrastructure and 
as tools for community and economic development.
    Rural Development's mission is to increase economic opportunity and 
to improve the quality of life for all rural citizens. We meet this 
mission by focusing on investments in economic development and 
infrastructure, by building and leveraging partnerships, and by seeking 
new ways of delivering our programs through ongoing innovation.
    RD manages a loan portfolio of more than $225 billion administered 
by three agencies: the Rural Utilities Service (RUS), the Rural 
Businesses and Cooperative Service (RBS), and the Rural Housing Service 
(RHS). RD investments support rural residents looking for affordable, 
safe housing; municipalities seeking water infrastructure and community 
facilities; and small rural businesses, co-ops, and agricultural 
producers looking to expand into new markets. We are also a vital 
source of financing for rural broadband and electric infrastructure. 
Together, RD agencies work to help communities build stronger 
economies, create jobs, and improve the quality of life in rural areas.
    In 2017, Secretary Perdue created the Innovation Center (IC) within 
RD, which I oversee as Chief Innovation Officer. A major part of what 
the IC does is analyze RD's program performance, policies and 
strategies, and find ways to improve program delivery to all our 
constituencies, including throughout rural tribal reservations. Our 
mission is to equip rural communities with economic development tools 
to drive rural prosperity. We achieve this by identifying best 
practices in economic development, promoting multi-sector partnerships 
and capacity at the local level, and driving synergies by promoting 
collaboration across agencies.
    The more than 40 programs that RD administers offer tribal leaders 
and members access to financial and technical assistance. We recognize 
the tremendous need for these types of resources in tribal communities 
and are fully committed to building on past investments and improving 
our ongoing support of tribal nations and Alaska. Secretary Perdue and 
Acting Assistant to the Secretary for Rural Development, Joel Baxley, 
place a high priority on improving program delivery to drive 
investments and promote development in Native communities.
    RD agencies have a long history of investing in tribal economies. 
Since 2001, Rural Development has invested more than $6.2 billion in 
loans and grants that will yield benefits to American Indians and 
Alaska Natives for years to come. Of this investment, $449 million was 
invested last year alone and has been deployed through a variety of 
projects.
    For example, RD provided a $7.6 million loan to the 1994 land-grant 
Cankdeska Cikana Community College to build an early childhood 
development center and daycare facility for the Spirit Lake Tribe 
located in Ft. Totten, North Dakota. This new facility replaced several 
older facilities and will provide an educational head start for Spirit 
Lake's children.
    In 2018, RD also provided a $5.8 million dollar Telecommunications 
Infrastructure Loan to Hopi Telecommunications, Inc in Arizona. This 
investment will be used to construct fiber-to-the-premises (FTTP) 
systems in the Keams Canyon, Kykotsmovi and Polacca exchanges and make 
additional system improvements. It is expected that approximately 650 
customers will be placed on the FTTP system, while customers who remain 
on the copper system or wireless system will all be able to access 
speeds of at least 10 Mbps upload and 1 Mbps download.
    Also in FY 18, through our Community Facilities loan program, we 
made numerous investments to tribes to help finance essential community 
facilities. For example, we provided a $4.8 million direct loan to the 
Yakutat Tlingit Tribe in southeast Alaska to construct a healthcare 
clinic, an $8 million direct loan and $3 million in guaranteed loans to 
the Blackfeet Nation in Montana construct a new senior care facility 
and a $1.4 million direct loan to the Red Lake Nation in Minnesota for 
the 2nd phase of construction of the Red Lake Community Center.
    Many RD programs are expressly designed to help alleviate the 
challenges faced in the most remote corners and persistently poor 
communities across the United States. We recognize that while many 
challenges faced by tribal nations are shared by all rural communities, 
these communities also face unique challenges. Through your leadership 
and support, Congress has provided RD with special tools to help drive 
investments to tribes and their members, as well as the 1994 land-grant 
tribal colleges and universities, including the mandatory funds we 
receive each year. It also includes the RUS Substantially Underserved 
Trust Area (or SUTA) provisions. The SUTA provisions provide additional 
flexibilities in our rural utilities programs to help drive investments 
in trust areas that are substantially underserved.
    Historically, RD has had funds provided by Congress for Tribal 
projects in the following programs:

   The Community Facilities program through the Tribal College 
        and University Grant Initiative;

   The Rural Business Development Grant program;

   The Intermediary Relending program;

   The Water and Environmental Grant program;

   The Rural Alaska Village Grant program; and,

   The Business and Industry Loan Guarantee program.

    These special tools ensure that tribal nations have access to funds 
for critical investments that benefit tribes and tribal members. In a 
typical year, approximately $50 million in program authority is 
legislatively mandated for tribal projects across these six RD 
programs. However, the vast majority of RD's investments benefitting 
tribes and Native Americans flow through our traditional programs. 
Using FY 2018 as an example, RD invested almost eight times the amount 
($399 million) in loans and grants that benefitted American Indians and 
Alaska Natives through our traditional programs compared to the tribal 
set-asides.
    RD often partners with other government and private financing 
entities on projects, including those serving tribes. For example, when 
the Mississippi Band of Choctaw Indians needed to build a new health 
center, funding from the tribe, RD's Community Facilities (CF) Program, 
and the Indian Health Service (IHS) were combined to support the 
project. In 2013, RD provided a $40 million CF direct loan, a 
commercial bank provided a $10 million loan that was then guaranteed 
through the CF program and the Choctaw contributed $5 million to the 
project. The result is a successfully operating new 20-bed hospital 
that also provides tribal members with outpatient, dental, emergency, 
trauma, behavioral health and community and public health services.
    RD's suite of programs enable us to serve our customers at almost 
any stage of development, from initial concept, to project and 
community planning, application development and construction. The 
variety of loan, grant, and technical assistance products and services 
provide tribes and those who serve them with a path to investing and 
growing over time to provide critical services to their members. Sacred 
Wind Communications (SWC), a New Mexico-based telecommunications 
provider, is a good example of this, first with a small RD grant in 
2005, and then with larger loans from RD that gave them the resources 
to scale and expand their reach. In 2005, SWC was first awarded a RUS 
Community Connect broadband grant for $436,461 to provide both phone 
and Internet services to Huerfano, New Mexico--a small town of 
approximately 400 residents, located on the Navajo Nation reservation. 
SWC contributed an additional $86,500 of its own funds to guarantee the 
success of the project. Telephones were installed in all community 
buildings, connectivity was delivered to key community buildings, and a 
new Computer Training Center was opened to the public. More recently, 
SWC has since also received multiple telecommunications loans from RUS, 
including a $13.8 million loan in March of 2016 to improve Internet 
service within the Navajo Nation in northwest New Mexico. The loan was 
awarded with a lower interest rate (2 percent) under the Substantially 
Underserved Trust Area (SUTA) provisions of the 2008 Farm Bill. The 
SUTA provisions were implemented as part of a long-term strategy to 
assist tribes in meeting their utility infrastructure needs and 
improving economic development.
    Leveraging the right programs at the right time enabled SWC to grow 
over time into a company that now serves tribal members across 22 
Navajo Nation chapters.
Broadband
    RD is building on its commitment to support deployment of critical 
infrastructure and to promote economic development in tribal areas. 
With an estimated 35 percent of residents of tribal lands still lacking 
broadband service, we understand that providing access to broadband is 
a high priority for many tribal leaders. From FY 2010-2017, tribal 
organizations benefited from $259.6 million in RUS loans, grants, or 
loan/grant combinations that were provided to tribal or non-tribal 
providers to support broadband infrastructure and programs on tribal 
lands. During that same time period, tribes directly benefited from 
$317.1 million in Broadband Initiative Program (BIP) grants and nearly 
$3 million in BIP Technical Assistance grants. In addition, $23.1 
million in Community Connect grants were awarded to tribes, tribally 
owned broadband providers, and other entities that bring broadband 
service to unserved tribal areas.
    RD's ReConnect is the most recent program to offer loans, grants 
and loan/grant combinations to finance broadband infrastructure 
projects through eligible rural entities, including tribes.
    The scoring criteria for Round One of ReConnect includes priority 
points for applications that serve tribal lands. Eligible tribal 
applicants may also invoke SUTA on ReConnect applications, particularly 
on interest rates. To ensure potential applicants understand the 
program and its eligibility requirements, RD is hosting six workshops 
around the nation. At least two of the workshops are located near 
tribal lands or at tribal venues, including one that is concluding 
today (April 10) in Tucson, AZ at a Pascua Yaqui owned facility. More 
information about the workshops can be found on the ``Events'' page at 
https://reconnect.usda.gov. We are hopeful that efforts such as these 
will encourage tribes to apply and equip them to prepare competitive 
applications for this funding opportunity.
    In addition to ReConnect, RD is beginning its work to implement new 
broadband provisions from the 2018 Farm Bill. As always, we will engage 
and listen to tribal perspectives as we implement these new provisions.
Technical Assistance
    For many tribal communities, understanding which RD programs meet 
their needs can be challenging. Advice and assistance are available to 
RD applicants and borrowers throughout the planning, filing, and build 
out of projects. RD provides technical assistance to tribes directly, 
in collaboration with partners and through grants provided to private 
technical assistance providers. Several programs, including the Water 
and Environmental Programs (WEP), the Community Facilities (CF) Program 
and the new ReConnect program offer funding for technical assistance 
and training.
    For example, WEP administers a Technical Assistance and Training 
(TAT) Grant program, as well as a Solid Waste Management Grant (SWM) 
program, both of which are available and subscribed to by tribal and 
Alaska native communities. Grantees of these programs provide a variety 
of training and assistance to rural water and waste utilities in 
everything from board governance and rate setting, to asset management. 
From 2007 to 2018, USDA awarded $12.4 million in SWM grants and $24 
million in TAT grants to tribes and non-profit entities to help tribes 
with technical assistance and training needs related to water, waste 
water, and solid waste management. In 2018, 47 percent of the TAT grant 
recipients were tribes or entities serving tribes.
    RD funded circuit riders also provide hands-on technical assistance 
to tribes in operating water systems. For example, when the Jemez 
Pueblo community in New Mexico became concerned with health impacts 
because red-colored water began flowing from their taps, they contacted 
the New Mexico Rural Water Association for help. Rural Water's Circuit 
Rider was able to determine that the reddish water was being caused by 
an improperly functioning chlorine injection pump. Working together, 
the RD funded Circuit Rider and the Pueblo staff rebuilt and calibrated 
the pump to deliver clean safe water to the 1,000 members on the 
system.
    In August of 2018, Rural Development Oklahoma partnered with the 
Native American Finance Officers Association and the University of 
Arkansas' Indigenous Food and Agriculture Initiative to provide 
training for RD Oklahoma Community Programs Staff on reading Tribal 
financial statements and underwriting tribal deals. As a result, the 
Community Programs staff in Oklahoma is better prepared to underwrite 
tribal deals and deploy more of RD's funding to tribes throughout the 
state.
    In terms of outreach, RD employs a full time National Native 
American Coordinator who works across all RD programs and provides 
support to RD staff and Tribes across the Nation. And in each state 
that serves at least one federally recognized tribe, RD appoints a 
Native American Coordinator, customarily as a collateral duty, to serve 
as a single point of contact for tribes in that state.
Innovating for Better Service
    RD is continuously exploring ways in which we can more 
strategically engage our customers and deliver our programs. Secretary 
Perdue has a clear vision for USDA programs to be delivered 
efficiently, effectively, and with integrity and a focus on customer 
service. Through RD's new Innovation Center, we are building our 
analytics capabilities to support data-driven decisionmaking and more 
strategic engagement. We intend to use this new function to 
strategically target our outreach to tribes and other rural customers. 
RD is also looking at new approaches to improve program delivery.
    For example, RD is partnering with two Native Community Development 
Financial Institutions (NCDFIs) that have extensive experience working 
in Native American communities. In FY 2018, RD obligated $800,000 each 
to Mazaska Owecaso Otipi Financial and to Four Bands Community Fund. 
The organizations will relend the money to eligible homebuyers for 
mortgages on South Dakota and some North Dakota Tribal trust lands. 
Mazaska Owecaso Otipi Financial and Four Bands Community Fund also will 
service the mortgage loans after they are made. RD is providing the 
funding through the Single Family Housing Direct Loan program.
    Each NCDFI contributed $200,000 for mortgages in the pilot program. 
RD is stepping out of its traditional business model with this pilot in 
an effort to increase home ownership on trust land. RD has helped 
nearly 4 million rural residents purchase homes since passage of the 
Housing Act of 1949. However, homeownership rates on tribal lands 
historically have been significantly lower than those for other 
communities. Both NCDFIs have deep ties to the local communities and 
will be able to reach potential homebuyers more effectively than USDA 
and other lenders. Currently, mortgage applications are pending with 
both NCDFIs and loans are anticipated in the coming months. RD will 
monitor the success of this pilot to determine whether to request the 
authority to expand its reach.
New Opportunities in the 2018 Farm Bill
    The 2018 Farm Bill reauthorizes RD programs that support tribal 
economic development and provides new tools that will enable RD to 
better serve the needs of tribal nations. Big or small, these changes 
will make a real impact on program delivery.
    We thank this Committee and the Agriculture Committees for the 
update to the Rural Alaska Village Grant (RAVG) program in Section 6408 
of the Farm Bill. This change supports the commitment among federal, 
state, and local partners to work collaboratively to deliver the RAVG 
program in an efficient, streamlined, accountable and impactful way. In 
June of 2011, RD, the Environmental Protection Agency (EPA), IHS and 
the State of Alaska entered into a Memorandum of Understanding (MOU) 
that detailed a new and better way of working with each other and 
Alaskan villages to make water and waste infrastructure investments in 
rural Alaskan villages where dire sanitation conditions exist in highly 
remote communities. Since then, RD has invested more than $220 million 
through RAVG to improve infrastructure and the quality of life for 
Alaska Natives.
    The RAVG program is an excellent example of how partnership among 
federal and state entities can change lives in native communities. The 
village of Eek, population 474, was an unserved community with no water 
or sewer infrastructure. Residents hauled water and utilized 
honeybuckets for wastewater. Over a span of four years, RD partnered 
with IHS, EPA and the State of Alaska to provide funding for a much-
needed new community-wide water and sanitation system. In 2017, RD 
awarded a $3.12 million RAVG grant to complete the last phase of 
construction and the project is near completion. The Alaskan Native 
Health Consortium (ANTHC) has been another instrumental partner, 
managing the project through construction. Because of the phased 
approach, many residents have already received first-time water and 
sewer service. The new system will have added health benefits as well. 
When running water and sewer is introduced to a community, illness 
rates drop. In one study of rural Alaskan communities, clinic visits 
for respiratory infections declined by 16 percent, skin infections by 
20 percent, and gastrointestinal infections by 38 percent after the 
introduction of modern sanitation systems. Working collaboratively made 
this life-changing project possible.
    The new Farm Bill also authorizes RD to refinance certain RD 
hospital loans, as well as telecommunications and electric loans. We 
understand that these authorities are of interest to tribal borrowers 
and we look forward to engaging on this issue in the upcoming USDA Farm 
Bill consultations.
    In Section 6302 of the Farm Bill, USDA is directed to establish a 
technical assistance program to improve tribal entities' access to RD 
programs. While RD has technical assistance funding in some specific 
program areas and dedicated staff across the country to serve our 
customers, this provision provides RD with the opportunity to engage 
and serve our native and tribal customers in a more comprehensive and 
focused manner. We are committed to providing technical assistance that 
addresses the unique challenges faced by tribal governments, tribal 
producers, tribal businesses, and tribally designated housing entities 
in understanding and strategically accessing RD's wide breadth of 
programs and services.
    RD is looking forward to the tribal consultations and listening 
sessions in the weeks and months ahead to hear from tribes how to best 
implement this section of the Farm Bill and to begin building the 
framework of a new central RD technical assistance function to be 
deployed should funding be appropriated for it.
Conclusion
    RD will continue to actively support all tribal nations in their 
efforts to improve the quality of life for their members. To do so, we 
will partner with other public and private entities to fund projects, 
leverage the many tools and authorities Congress has provided, and work 
to provide faster, friendlier and more efficient access to RD programs.

    The Chairman. Thank you, Ms. Ponti-Lazaruk.
    Now we will turn to Lieutenant Governor Thompson.

          STATEMENT OF HON. MARK THOMPSON, LIEUTENANT 
         GOVERNOR, ACOMA PUEBLO; BOARD MEMBER, INDIAN 
                     PUEBLO CULTURAL CENTER

    Mr. Thompson. Thank you, Chairman Hoeven, Vice Chairman 
Udall, and members of the Committee. I appreciate the 
opportunity to provide testimony today before the Senate 
Committee on Indian Affairs.
    My name is Mark Thompson. I am the First Lieutenant 
Governor for the Pueblo of Acoma in New Mexico. I am here today 
to represent the Indian Pueblo Cultural Center and Indian 
Pueblos Marketing, Inc.
    Up until my recent appointment as the Lieutenant Governor 
for the Pueblo of Acoma, I served as the Property Development 
Director for both of these corporations. I have with me today 
the President and CEO of IPCC and IPMI, Mr. Michael Canfield. 
Both Indian Pueblos Marketing, Inc. and the Indian Pueblo 
Cultural Center are owned and operated by the 19 Pueblos of New 
Mexico and are located on trust land in the center of 
Albuquerque that once housed the Albuquerque Indian School.
    The vision for our organizations located on this property 
includes creating unique and successful businesses, providing 
professional and economic advancement opportunities for our 
workforce, nurturing self-sustainable developments while 
providing financial returns to our Pueblo communities, and 
promoting and preserving Pueblo arts, culture, and lifestyles.
    The Indian Pueblo Cultural Center began operations in 1976, 
and has a long, successful history of self-sufficient 
operations. Starting from humble beginnings on 11 acres of land 
with a handful of employees, we have grown to manage three 
corporations and five LLCs generating $45 million in annual 
revenue, and providing employment for over 200 employees, of 
which 50 percent are Native American.
    Our business operations currently include a gas station and 
convenience store, an independently owned and operated 
Starbucks, two fully leased office buildings, a 108-room 
Holiday Inn Express, a wonderful museum and exhibit space, 
restaurants, and the Native American Community Academy Charter 
School.
    We are currently planning a 120,000 square foot office 
building, 50,000 square feet of retail space, and have under 
construction currently, right now, a new Marriott TownePlace 
Suites. I have a copy of the master plan as part of my 
testimony.
    We have become a major contributor to the State of New 
Mexico, the local economy in Albuquerque and Bernalillo County 
because of the business we create and our ability to attract 
tourism. We are one of the top five most-visited attractions in 
New Mexico, hosting approximately 400,000 visitors per year.
    I share this information with the Committee because we are 
a prime example of the success that tribes can have while 
working together and utilizing all the tools you have heard 
described today and, in particular, one tool, the BIA Loan 
Guaranty Program. This tool is critical to our growth. The type 
of growth we have experienced requires a large amount of 
capital investment. Property development is not cheap. Our 
Pueblo owners have provided support for us, but the enormous 
amount of funds required for property development requires that 
we partner with financial institutions. This is not always 
done. As mentioned, we are on trust land.
    It is difficult for us to get loans on trust land; hence 
the BIA Loan Guaranty Program collateralizes 90 percent and 
allows us to seek financing through these financial 
institutions. Over the past 40 years, Indian Pueblos Marketing, 
Inc has financed, through the BIA Loan Guaranty Program, $23 
million in loans through this program to help develop our 
Albuquerque Indian School property which I mentioned.
    I am also proud to say that we have never missed a payment 
and have not defaulted on any of these loans. I would also like 
to mention that we use other tools mentioned here today through 
the Department of Commerce, the Economic Development 
Administration, State capital outlay funds and other private 
funding. The backbone of this has been the BIA Loan Guaranty 
Program.
    Indian Pueblos Marketing, Inc. and the Indian Pueblos 
Cultural Center would not be who we are today without the help 
of the BIA Loan Guaranty Program. That has to go without 
saying.
    I would like to also recognize some of the employees in 
this area, Alsace Laframboise and Jerry Rayburn in the 
Southwest Zone Office in Albuquerque who have been critical in 
administering this loan on behalf of the Federal Government.
    I want to thank the Committee for allowing me the 
opportunity to testify on behalf of the Cultural Center in 
Albuquerque. I stand for questions.
    Thank you very much.
    [The prepared statement of Mr. Thompson follows:]

 Prepared Statement of Hon. Mark Thompson, Lieutenant Governor, Acoma 
          Pueblo; Board Member, Indian Pueblo Cultural Center
    Chairman Hoeven, Vice Chairman Udall, and members of the Committee, 
thank you for the opportunity to provide testimony today for the Senate 
Committee on Indian Affairs oversight hearing regarding ``Building Out 
Indian Country: Tools for Community Development.''
    My name is Mark Thompson. I am the 1st Lieutenant Governor for 
Acoma Pueblo, located in Acoma, New Mexico. I am here today to 
represent the Indian Pueblo Cultural Center (IPCC) and Indian Pueblos 
Marketing, Inc (IPMI). Up until my Tribal government appointment in 
December 2018, I was the Director of Property Development for both of 
these corporations. I have with me today the President and CEO of IPCC 
and IPMI, Mr. Michael Canfield.
    Both IPMI and IPCC are owned and operated by the 19 Pueblos of New 
Mexico, and located on trust land in the heart of Albuquerque that once 
housed the old Albuquerque Indian School.
    The vision for our organizations located on this property includes 
creating unique and successful businesses, providing professional and 
economic advancement opportunities for our workforce, nurturing self-
sustainable developments while providing financial returns to our 
Pueblo communities, and promoting and preserving Pueblo arts, culture, 
and lifestyles.
    The Indian Pueblo Cultural Center began operations in 1976, and has 
a long history of successful, self-sufficient operations. Starting from 
humble beginnings on 11 acres of land with a handful of employees, we 
have grown to manage three corporations and five LLCs generating $45 
million in annual revenue, and providing employment for over 200 
employees, of which 50 percent are Native American. Our business 
operations currently include a gas station and convenience store, an 
independently owned and operated Starbucks, two fully leased office 
buildings, a 108-room Holiday Inn Express, 10,000 square feet of museum 
and exhibit space, a Pueblo-inspired restaurant, museum store, a 25,000 
square-foot building leased to the Native American Community Academy 
Charter School, and 10,000 square feet of leased restaurant space. We 
are currently constructing a community plaza, and our new 92-room 
Marriott TownePlace Suites Hotel. And we're in the planning phase for a 
new 120,000 square-foot office building, 50,000 square feet of 
additional retail space, and an Indian Pueblo Opportunity Center that 
will support Native entrepreneurs with a business startup incubator and 
makerspace focusing on creative and agricultural industries. I have 
included a copy of our master plan as part of my testimony that 
includes our most recent projects.
    We have become a major contributor to our state and local economy 
because of the business we create, and because of our ability to 
attract tourism. We are one of the top five most-visited attractions in 
New Mexico, hosting approximately 400,000 visitors per year.
    I share this information with the Committee because we are a prime 
example of how successful tribes can be when working together and 
utilizing all the tools available to us.
    One such tool I would like to focus on today is the BIA Loan 
Guaranty, Insurance, and Interest Subsidy Program. The type of growth 
we have experienced, including the large amount of property development 
we're involved in, has required a significant amount of capital. Our 
Pueblo owners have provided us with some financial support, but the 
enormous amount of funds required for this scale of growth needs to 
come from loans from financial institutions. As I mentioned, we are 
located on trust land, which makes collateralization of assets 
extremely difficult. Because of this, we were unable to find any banks 
willing to provide the financing to fund our plans for growth. We were 
fortunate to qualify for the BIA Loan Guaranty Program so our loans 
could be collateralized with a 90 percent guaranty. Over the past 40 
years IPMI has financed more than $23 million in loans through this 
program. These loans made it possible for us to build our convenience 
store, Starbucks, the charter school building, and virtually all the 
operations I mentioned previously. I'm happy to report we have never 
defaulted on any of these loans. In fact, we've never missed a single 
payment.
    I should also mention that we have utilized other tools to assist 
us, like EDA grants and state capital outlay funding. We've also been 
fortunate to receive support from private donors, but it is accurate to 
say that without the BIA loan guaranty program, IPMI and IPCC would not 
be what we have become today.
    I would also like to recognize BIA employees from this program, 
like Alsace Laframboise and Jerry Rayburn in the Southwest Zone Office, 
who have been so helpful administering the guaranty program.
    I want to thank the Committee for inviting me to testify this 
afternoon, and I am happy to answer any questions.
    Attachment

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    The Chairman. Thank you, Lieutenant Governor Thompson.
    I agree with you. I have a banking background and the BIA 
Loan Guaranty, I think, is, if not the most powerful tool, 
certainly one of the most powerful tools I have found in terms 
of financing in Indian Country. I could not agree with you more 
on that.
    We will now have five-minute rounds of questioning. I will 
start with Secretary Sweeney.
    In terms of economic development tools, obviously there is 
an array of tools available to tribes across a number of 
agencies. Is there any database or repository either in 
Interior or somewhere else in the Federal Government where 
someone on the reservation can go and look and see all of the 
available tools? Is there some kind of database or something 
where they can look at all these tools and figure out which 
ones they need and maybe more than one?
    Ms. Sweeney. Not to my knowledge, sir.
    The Chairman. Is that something you think should be worked 
on?
    Ms. Sweeney. Absolutely.
    The Chairman. It would seem to me that there are some very 
good tools. Often you have to use them in conjunction. That 
might be something, Staff Director, we should keep in mind. It 
seems to me it would be good to have one place where someone 
can check and see what all the tools are, what is available.
    In previous hearings, we received testimony that there is a 
lack of legal information for private businesses on the 
reservation. My question is, how is the department working to 
help tribes develop commercial codes and attract investment on 
the reservation?
    Ms. Sweeney. Thank you for your question.
    Your observation is correct. Without the codes, businesses 
on the reservation cannot finance their inventories from 
sellers outside of Indian Country. Members cannot obtain credit 
for off-reservation purchases brought onto the reservation 
because the rules cannot be enforced in Indian Country.
    The National Conference of Commissioners on Uniform State 
Laws and a working group of tribal officials drafted a model 
Tribal Secured Transaction Act to use as a template for 
legislation by tribes. This template is designed to help tribes 
facilitate the transactions with outside lenders and 
businesses.
    It is our goal to provide tribes with all of the necessary 
tools to not only work with non-Native corporations, but also 
to attract investment and partnerships to Indian Country.
    The Chairman. Clearly, this is an area that needs more 
work. I strongly encourage you to devote attention to it in 
terms of having resources for the tribes that they can call on 
to try to develop some of those commercial codes and other 
things they need to be entrepreneurial.
    Ms. Sweeney. Our Division of Indian Energy and Economic 
Development have been working on providing that legal structure 
to tribes and working with tribes to develop that legal 
structure for the codes. We certainly are open to any 
improvements to that process and to provide tribes with 
additional access to those tools.
    The Chairman. Ms. Ponti-Lazaruk, when Secretary Perdue 
announced creation of the Rural Development Innovation Center, 
one of his initiatives was the One RD Guarantee Loan. Can you 
provide me with an update of how that is going?
    Ms. Ponti-Lazaruk. I would be happy to do that.
    The One RD Guaranteed Loan rule is actually being 
coordinated through the Innovation Center. We held a series of 
listening sessions in the fall, one of which was a tribal-
specific listening session. We had a lot of good comments.
    For a frame of reference, this is a rule that takes four of 
our programs that are guaranteed loan programs and tries to 
create a new way of doing business around all four and 
standardizes it across them. Right now, we are in the process 
of reviewing those comments and the input from all of our 
customers and trying to make some decisions on how we might 
want to implement the program. We are taking a holistic 
approach to this so it is not just about the rule but also 
about how we interact with our customers, an online interface 
and other ways to get standardized filing.
    As we move forward in the months ahead, we will be looking 
for external customers to give us feedback on how to develop 
that. We would welcome tribal input on that as well.
    The Chairman. I think you have real potential with it. I 
hope you are able to move forward and have an impact.
    Ms. Harris, in your testimony, you discuss re-launching the 
Building Native CDFI's Sustainability and Impact Training and 
Technical Assistance Series. Can you provide an update on how 
the department has discussed this re-launching initiative with 
the tribes and what the response has been?
    Ms. Harris. Thank you, Mr. Chairman.
    We originally discussed the re-launching of the Capacity 
Building Initiative in 2017. Since then, we have engaged 
roundtables through our traditional outreach at conferences and 
through working with a Native CDFI who is leading this effort 
on the contracting side to speak with Native CDFIs about what 
they are looking for, what type of training would be 
appropriate and the modality in which to deliver the training.
    So far, since we opened registration three weeks ago, we 
have had significant response and interest. We have over 60 
groups who have expressed an interest in attending the 
training.
    The Chairman. Good. As you know, that is one of the things 
in our ICEE bill that we tried to really develop and expand, 
the CDFIs. We see that as an important source of investment and 
funding on the reservations. We are going to try to help you 
expand that and do more with that program.
    Ms. Harris. Much appreciated. Thank you.
    The Chairman. Director Childs, in your testimony, you 
referenced the creation of the Office of Policy Analysis and 
Development. One of the responsibilities is to conduct data 
analysis about American Indian, Alaska Native and Native 
Hawaiian businesses and then produce the reports once you have 
analyzed the data.
    How do you plan to conduct tribal outreach and when should 
we expect to see those reports?
    Mr. Childs. Thank you for that question.
    I am very proud of the Office of Policy Analysis and 
Development. MBDA is moving towards doing more in the policy 
and data space. We know the need to produce faster and more 
reliable data exists, especially in Indian Country.
    As far as outreach, I think we have a very good network. As 
I mentioned before, we did tribal consultations in fiscal years 
2016 and 2017, going out and talking to people. As you know, 
the needs are unique depending where you are in the United 
States.
    More important, I think, is going to some of the big 
summits and listening. I just came back from Las Vegas for the 
Reservation Economic Summit. I spoke at 9:30 a.m. and there 
were over 1,000 people in the room at 9:30 a.m.
    When I tell you there was excitement in the room, when they 
said Director Childs, if we have a level playing field, we have 
no problem with competition. One of the things they look for me 
to do is to help reduce some of the barriers they face on 
reservations. I take my directorship very importantly and I am 
going to do more of that. We are going to listen and we are 
going to actually do some positive things.
    The Chairman. When do you think that will be out? When do 
you expect the report?
    Mr. Childs. We are bringing on an economist. I expect us to 
start doing the hard, crunching of the numbers this year and 
then either late this year or early next year, we should have 
the report.
    The Chairman. I will tell you this. I like your attitude, I 
really do. I get the sense you want to get some things done. I 
have no doubt you will. I can just tell. I appreciate that. I 
just wanted to commend you on it.
    I also have to acknowledge that for the Minority Business 
Development Agency at the Department of Commerce, I believe it 
is your 50th year anniversary.
    Mr. Childs. It is our 50th year anniversary.
    The Chairman. Congratulations on that. I think they got the 
right guy in there advancing the ball.
    Mr. Childs. Thank you very much.
    The Chairman. Thank you.
    Senator Cortez Masto.

           STATEMENT OF HON. CATHERINE CORTEZ MASTO, 
                    U.S. SENATOR FROM NEVADA

    Senator Cortez Masto. Thank you, Mr. Chairman.
    Let me also echo those comments, Mr. Childs. Also to all of 
you, thank you for being here. Thank you for your commitment 
and passion to what you are doing to help our tribal 
communities and our rural communities in general.
    That is one of the things I wanted to talk about. Last 
year, Senator Portman and I were able to get enacted the 
Council on Rural Community Innovation and Economic Development 
through the Farm Bill.
    The purpose of this was to enhance the efforts of the 
Federal Government to address the needs of rural communities, 
including those in Indian Country that we are advocating today. 
The Council is comprised of representatives from all of your 
larger Federal agencies. I am hoping to see creative and 
efficient solutions to help those in our Native communities 
with the recommendations and the Rural Smart Community Resource 
Guide the Council is tasked with developing.
    Let me just ask one of you. Ms. Ponti-Lazaruk, can you 
provide the status of implementation of this council? Are you 
on it? Who is on it? Can you provide any information about how 
it is moving forward?
    Ms. Ponti-Lazaruk. I can.
    We are at the beginning of implementing all our Farm Bill 
provisions. We have had a kick-off meeting to discuss, across 
the Federal family, the next steps for the council. We look 
forward, in the months ahead, to seeing that roll out.
    Senator Cortez Masto. For those of you in Federal agencies, 
can I get a commitment that you are committed to the council 
and doing everything you can to promote the rural communities 
and innovation, particularly when it comes to smart technology?
    Ms. Sweeney. Absolutely.
    Ms. Harris. Yes, Senator.
    Mr. Childs. Yes.
    Senator Cortez Masto. Thank you. I appreciate that.
    The other thing that was important for me, which you 
touched on, was broadband. It is the number one issue in our 
tribal communities and our rural communities. It is a 
challenge. I cannot tell you the opportunities it brings to 
these communities if we are to open that door.
    The other legislation that was able to move through the 
Farm Bill was the Rural Broadband Integration Working Group. To 
me, it is another way for the Federal agencies really to work 
together to focus on how we address the barriers, how we bring 
forth broadband, and making sure the money is going where it 
needs to go.
    Let me just ask this. Are any of you aware of this working 
group or the implementation of it? Is this still a part of what 
is being implemented from the Farm Bill?
    Ms. Ponti-Lazaruk. It is still part of what is being 
implemented from the Farm Bill. For rural development, we 
understand the importance of broadband. I personally understand 
it. I came from 15 years at the FCC to join Rural Development 
and run the telecommunications program in 2006. I understand 
firsthand how important this is.
    We look forward to implementing all of the parts of the 
Farm Bill associated with broadband and bringing more broadband 
to rural and tribal areas.
    Senator Cortez Masto. Thank you.
    For that and as we bring in broadband and understand where 
there are underserved populations, I am from Nevada and I can 
tell you if you get even an hour or two hours out, you are off 
the grid. Our rural communities and or tribal communities are 
challenged as well.
    Here is an issue that I am curious if you are looking at 
it. I also know that the mapping that is done, particularly as 
I said on Senate Commerce, is not accurate. The mapping that 
our Federal agency has to identify those underserved 
communities or lack of broadband is not accurate in my 
communities and I have heard from my colleagues that it is not 
accurate in their communities as well.
    Is that something that, as you are looking at bringing in 
broadband and interconnectivity, you are aware of and how are 
you addressing that?
    Ms. Ponti-Lazaruk. Thank you for that question. It 
highlights something that has been a challenge, I think, for a 
lot of years, getting not only data on where broadband is and 
is not, but getting that data to stay accurate over time.
    I think that is one of the reasons I am very excited that 
Secretary Perdue created the Innovation Center. Our analytic 
shop is working with the department's analytic shop to find 
other data sources that we might use in corroboration with the 
FCC data and other data that is out there so we can really 
better target our funds.
    It will happen over time as we begin to look at those 
various data sources but I am hopeful that we will have a 
better idea of where the service gaps are and how we can better 
serve.
    Senator Cortez Masto. I would hope you would tell us as 
well what we can do at the Federal level to make sure we are 
identifying those areas and addressing those needs. Thank you.
    Ms. Ponti-Lazaruk. Absolutely.
    Senator Cortez Masto. I know my time is running out, thank 
you, Mr. Chairman.
    The Chairman. Senator Daines.

                STATEMENT OF HON. STEVE DAINES, 
                   U.S. SENATOR FROM MONTANA

    Senator Daines. Thank you, Mr. Chairman.
    I want to thank the witnesses for being here today.
    No doubt providing economic opportunity is essential but I 
would argue the first priority of any community has to be 
safety. At the top of that list in Indian Country, of course, 
is the crisis we have with missing and murdered indigenous 
women.
    Last week, I introduced a resolution that designates May 5 
as the National Day of Awareness for Missing and Murdered 
Native Women and Girls. You might ask why May 5th? May 5th was 
the birthday of Hanna Harris. Hanna was a 21-year-old mother 
and a member of the Northern Cheyenne Tribe, who was murdered 
in 2013. She would have turned 27 this May.
    In fact, I was honored to walk in and speak at a march we 
had in Billings just this past Friday raising awareness for 
missing and murdered indigenous women. I literally marched 
beside Hanna's mother during that event in Billings. If you 
watched The Lead on CNN with Jake Tapper just last night, it 
highlighted the fact that the murder rate of Native women is 
ten times the national average.
    Assistant Secretary Sweeney, this issue demands immediate 
and focused attention. I know you are aware of it. We must 
continue to raise awareness and bring justice. Communication 
and coordination between Federal agencies, law enforcement and 
tribes must be improved in order to combat this tragic reality.
    I support Savanna's Act, the SURVIVE Act, the Studying 
Missing and Murdered Indian Crisis Act. What else do you need 
from Congress to help end the crisis of missing and murdered 
indigenous women? I just listed three bills that we are working 
on.
    Ms. Sweeney. Thank you for your question. This is an issue 
that I am extremely passionate about.
    We have been working internally as my written testimony 
reflected, on looking at developing strategies with our Office 
of Justice Services within BIA. There is a need to look at cold 
cases with respect to Indian Country. What I have heard from 
our officers internally is that they have a strong desire to 
focus on cold cases to bring families closure, to have that 
finality, to find the answers.
    We need assistance in removing barriers. Also, when you 
look at violent crimes and missing and murdered American Indian 
and Alaska Native women and children, we want to partner with 
this Committee, we want to partner with other Federal partners 
to combat this. There is an education process that needs to 
take place.
    Senator Daines. As I was chatting with a lot of the 
marchers, we were having conversation as we were walking and I 
was struck by the fact that if a non-Native woman is missing or 
murdered, it oftentimes becomes a great big national story. If 
a Native woman is murdered or missing, unfortunately there are 
way too many cold cases out there.
    I have a couple other questions, so I want to thank you for 
your response and your continued focus on this issue. I have 
requested a field hearing on this issue in Montana to get folks 
on the ground giving input where this crisis is directly 
impacting our tribes, destroying families and I look forward to 
working with this Committee to make sure this happens in a 
timely manner.
    I would like to shift gears to discuss Stanley Patrick 
Weber, an IHS pediatrician who was recently convicted of 
sexually abusing children on the Blackfeet Reservation in 
Montana. Mr. Weber's actions and the manner in which IHS 
handled him are inexcusable.
    I am committed to demanding accountability so that 
something like this never, ever happens again. We must ensure 
that victims of sexual abuse have access to resources they 
need.
    Ms. Ponti-Lazaruk, how can the Department of Agriculture 
help tribal communities utilize grants to provide services to 
victims of sexual assault?
    Ms. Ponti-Lazaruk. Thank you for the question.
    The USDA Rural Development Program, both loan and grant, 
can be used for communities or tribes to build a trauma center 
or temporary housing for victims, or to have counseling 
services available to them.
    They would come to our Community Facilities Program, a 
wonderful program, which has a very broad breadth of types of 
projects that can be funded there. We would be happy to reach 
out.
    Senator Daines. Thank you. I am also currently looking at 
legislative options to ensure that if, God forbid, another 
monster like Stanley Patrick Weber comes along, he would not 
receive a dime of taxpayer dollars in government pensions. He 
is set up to have this huge pension. That is absolutely wrong. 
We are fighting to make sure he never sees a dime of that 
pension.
    Lastly, this past winter, in Montana we experienced record 
cold temperatures. We have seen many issues in Indian Country 
as a result. In fact, last month, we had outdated water lines 
at Crow Agency. I was speaking with Chairman Not Afraid of the 
Crow Tribe. We had pipe freezing and breaking meaning a 
complete loss of their stored drinking water supply.
    A few days later, Chairman Not Afraid declared a state of 
emergency in response to severe flooding from heavy snow packs. 
Literally the Crow Tribe has seen flooding, frozen pipes and 
they had a fire. Oftentimes associated with colder weather, you 
have to find other ways to heat. It happened to the Crow Tribe 
in the last six weeks.
    Assistant Secretary Sweeney, I have a question for you. How 
can DOI ensure the tribes have access to the funds they need to 
build or update water systems and infrastructure to help them 
become more resilient to natural disasters?
    Ms. Sweeney. Thank you for your question.
    I would like to point out that BIA has never been funded 
for emergency management as a program or for disaster relief. 
Any of the funds that BIA provides to tribes to assist during 
these emergencies and disasters comes from other programs.
    BIA Wildland Fire Fund suppression dollars cannot be used 
for any of the all hazard incidents. We continue to monitor 
what is happening in the Great Plains. After the series of 
storms, we are building a database of the impacts that have 
taken place in the Great Plains and across the Country.
    We are also sending out a Dear Tribal Leader letter asking 
about the impacts of the shutdown. In addition to that, we are 
also asking what impacts they are receiving as a result of 
these natural disasters, what Federal funds are available to 
them, and what Federal funds do not cover the cost of the 
disasters.
    Senator Daines. I am out of time, well over time, but that 
is one issue itself. This is getting back to being more 
proactive and making sure we have basic water system that is 
more resilient to withstand this.
    When it is 35 degrees below in Montana, I am sure it is a 
natural disaster but we call that winter time. We need 
resilient systems there to accommodate cold temperatures. Thank 
you.
    Senator Udall. [Presiding.] Senator Smith.
    Senator Smith. Thank you very much, Vice Chairman.
    Thanks so much to you all for being here to testify today.
    I would like to start by asking some questions about 
housing. Owning a home, having a safe place to live is really 
fundamental to having everything else in your life work. Also, 
owning a home is the fundamental way that people build wealth 
and retirement savings even.
    Yet, lack of housing is a big impediment to building 
economic opportunity and economic development in Indian 
Country. I was just looking at some data that is really 
surprising. About 40 percent of housing in Native areas is 
identified as being substandard.
    Home ownership in Indian Country is about 33 percent, far 
below what you see in the rest of the Country. I certainly 
understand there are complicated issues around trust lands and 
so forth.
    Let me start with you, Assistant Secretary Sweeney. What 
can you tell us about the work we are doing and should be doing 
to address housing issues in Indian Country?
    Ms. Sweeney. As you know, we are not a housing agency. We 
must partner with other agencies such as HUD, Agriculture and 
the VA in their work with rural development and VA home 
ownership.
    Senator Smith. I know that you do not do housing yourselves 
but yet, how does economic development work if there are not 
places for people to live and opportunities for people to build 
wealth? Let me ask it this way. How do you see your role in 
terms of coming up with strategies across different Federal 
agencies on this really important issue?
    Ms. Sweeney. Thank you for that question.
    Housing is extremely important in creating stable economies 
and safe places to live, especially in rural areas, including 
Indian Country. As I said earlier, it is important for us to 
partner with the agencies whose core mission is to provide 
housing opportunities.
    What we bring to the table at Indian Affairs is the Indian 
Affairs perspective and the advocacy for innovative approaches 
to housing. When you look at a community in Alaska that is 
looking to different programs to build tiny homes in some of 
the most remote areas of the State, we need to be thinking 
outside of the box when we look at housing in Indian Country.
    Senator Smith. Ms. Harris, would you like to respond?
    Ms. Harris. Yes, thank you, Senator.
    The benefit of working with Native CDFIs is that these 
financial institutions work closely with the tribal government 
in Native communities to assess the housing needs. I am happy 
to report that our Native CDFIs, through our NACA Program, our 
primary funding program for Native CDFIs, have done over $117 
million in home improvement and first down payment assistance 
programs.
    There is a way to partner with financial institutions but, 
of course, there is much more need as Assistant Secretary 
Sweeney mentioned that would require all the Federal agencies 
to work together.
    Senator Smith. This could be a strategy for getting at 
issues about access to capital and shortages of access to loans 
at financial institutions that are even available in Indian 
Country?
    Ms. Harris. Absolutely.
    Senator Smith. Thank you.
    Let me shift gears if I could and come to Ms. Ponti-
Lazaruk. This is the issue in which I am interested.
    Last Congress, I worked with Senator Udall and Senator 
Heitkamp to introduce the Tribal Food and Housing Security Act. 
Part of this bill serves as the basis for Section 6302 in the 
2018 Farm Bill reauthorization which requires Rural Development 
to establish a technical assistance program to improve tribal 
entities access to your agency's programs.
    You testified that Rural Development is developing tribal 
consultations and listening sessions to implement Section 6302 
of the Farm Bill but funding is needed. Could you tell me what 
is the new Central RD Technical Assistance function you 
mentioned in your testimony? Is that different from the 
existing TA function?
    Ms. Ponti-Lazaruk. It is. Thank you for your question.
    The new Technical Assistance Program for tribes will 
actually be stood up within in the Innovation Center. I am 
really excited, having run several programs in Rural 
Development and understanding firsthand through that project 
work some of the challenges and the needs for technical 
assistance in tribal areas, and to be able to bring all of that 
together under the umbrella of the Innovation Center. It will 
come under my leadership and I am excited to stand it up.
    Senator Smith. Could you just let us know whether your 
agency asked for funding to support that function in the fiscal 
2020 budget?
    Ms. Ponti-Lazaruk. That is an excellent question. I will 
have to get back to you on that. I have to check.
    Senator Smith. Thank you, Mr. Chair.
    Senator Udall. Senator Murkowski.

               STATEMENT OF HON. LISA MURKOWSKI, 
                    U.S. SENATOR FROM ALASKA

    Senator Murkowski. Thank you, Mr. Chairman.
    Thank you all for your testimony. I was not able to hear 
many of your comments and I hope I am not repeating but I 
appreciate the contribution from each of you.
    I do understand that Senator Daines did speak with you 
briefly, Secretary Sweeney, about the missing and murdered 
indigenous women issue. This is something that we have great 
interest in working on with you and your teams.
    Just know that whether it is the legislation we introduced 
last year and brought back again, Savanna's Act, or the Not 
Invisible Act that Senator Cortez Masto and I just introduced, 
there is a great deal of interest in working on these issues 
with you. We share that with Senator Daines.
    I wanted to ask you about some of the capitalization 
strategies that you have been working on in Indian Affairs. We 
see the good examples in Alaska in some of our communities with 
the programs through Indian Affairs that they have been able to 
access.
    We have projects in Toksook Bay, Hoonah, Anchorage, Bethel, 
Kodiak, and many others that have used the Indian Affairs 
programs. You have the uniquely tailored Indian Loan Guarantee 
Program.
    It would be helpful for me to understand, in your view, 
what more we can be doing to provide for a level of assistance. 
I do note that the fiscal year 2020 budget request proposes to 
phase out the Loan Guarantee Program as duplicative.
    How is all this working and what more can we be doing to 
help you?
    Ms. Sweeney. Thank you, Senator Murkowski.
    OMB found duplicative guarantee programs across the Federal 
Government. Given today's economic climate, it was prudent to 
propose consolidating the loan guarantee programs across the 
Federal Government.
    I want to address that issue. I know it is an issue of 
concern raised by many members on this Committee with me 
personally. There is no dispute that the Indian Guarantee Loan 
Program is successful. We need patient capital in Indian 
Country. We need to have the incentives to attract investment 
in Indian Country.
    However, we are not an economic lending agency with a large 
staff whose core mission is to lend to Indian Country. Our core 
mission is to uphold that trust responsibility and the treaty 
obligations. What we do though is perform the services that 
facilitate economic development, whether it is taking land into 
trust, doing environmental reviews, providing infrastructure or 
feasibility studies.
    Again, I want to stress that we are not a financial lending 
agency but we want to work with those agencies to ensure that 
Indian Country has the access to that capital. When you ask 
what we can do, you have heard from the different agencies 
sitting at the table, representatives from the Administration, 
of the different programs they offer.
    Last November, I hosted a roundtable with community 
development financial institutions that were Native-owned in 
addition to Native-owned banks and credit unions. It was 
historic. There were three priorities that came out of that 
roundtable.
    It was partnering with Native CDFIs to deliver financial 
literacy and business training in some or all of our BIE 
schools; working with Treasury to ensure that Native financial 
institutions continue to build greater and greater capacity, 
especially in the area of new market tax credits; and that we, 
at Indian Affairs, review our internal systems to shorten the 
review and approval process on administrative requirements for 
services needed to facilitate economic development where trust 
property is involved.
    Senator Murkowski. I appreciate that recap. Understanding 
the role you have within Indian Affairs as kind of this 
oversight, one of the things I worry about, as we do 
consolidation, is that the specific Native interests might be 
overshadowed by the broader purpose of the funds or programs.
    We need to know we have somebody looking specifically to 
the needs of Indian Country, looking specifically to the needs 
of the Native people within these programs so that they are not 
overlooked, not overshadowed, not excluded because of 
definitional issues.
    You and I know full well how many good, well intentioned 
programs Alaska Natives have been not eligible for because of 
mere definitions. I do hope that you continue to be aggressive 
in this level of oversight, making sure that level of review 
and applicability for our Native people is honored.
    Ms. Sweeney. Thank you. I appreciate your comments.
    I do know that there are definitional issues. One I would 
like to raise with you with respect to Alaska is there are 
grant programs that include trust lands which are extremely 
important, but do not afford Alaska Native entities the 
opportunity to take advantage of them.
    I am happy to provide that information to the Committee 
with the specific types of grants we are talking about.
    Senator Murkowski. I look forward to that.
    Mr. Chairman, I have one very brief question to ask Ms. 
Ponti-Lazaruk if I may.
    I want to thank you for what USDA has done to help recently 
with the benefit of the Rural Alaska Village Grant Program. I 
am going to be going to Eek, Alaska on Saturday. We will be 
celebrating the new water and sanitation system in that 
village. That came about because USDA partnered with IHS and 
EPA and the State of Alaska. This is a really good news event. 
I am delighted to be able to participate in that.
    I do want to raise, very briefly with you, your scoring 
criteria for this new economic activity program. We have heard 
some concerns that the scoring criteria may work against rural 
Alaska and Alaska Native communities in several different ways.
    One of the concerns is that small communities in Alaska may 
actually lose out because even though they are very remote and 
are not connected, the actual communities are pretty densely 
packed. Native villages tend to be community hubs for the 
region they are in.
    Because of environmental considerations, you have village 
members that live in very close proximity to one another which 
makes the density seem high. Sometimes there are no health 
facilities, no businesses, critical community centers to 
connect, so we just do not have those connection points.
    Instead of having farms and ranches, which get points in 
your scoring system, families in rural Alaska rely on 
subsistence, they are out hunting and fishing. We have a 
situation where we may actually not score as well given the 
nature and yet the need for the broadband infrastructure is 
absolutely imperative and cannot be overstated.
    I raise that with you. I do now know if it has been brought 
to your attention before but would ask you to consider that and 
keep our unique situation in mind.
    Ms. Ponti-Lazaruk. Thank you, Senator.
    As you know, because we met in Alaska at the Rural Alaska 
Village Grant Conference, I have been to a number of these 
communities and the Alaskan villages. I understand and will 
certainly consider that as we move forward, especially into 
round two.
    Senator Murkowski. Greatly appreciated. Thank you.
    Thank you, Mr. Chairman.
    Senator Udall. Thank you.
    Ms. Sweeney, are there any other Federal programs which 
allow tribal members and tribes to collateralize trust land? 
That is what the Indian Loan Guarantee Program does. My 
understanding is there are not any.
    Ms. Sweeney. I would like to ask your question of Jack 
Stevens.
    Senator Udall. Mr. Stevens, please, the Indian Loan 
Guarantee Program allows the collateralization.
    Mr. Stevens. David, would you like to address that?
    Mr. Johnson. What we do is we take a deed of trust on the 
leasehold interests so it is a leasehold deed of trust. That is 
the way it is collateralized.
    Senator Udall. There is nothing else like that?
    Mr. Johnson. I do not know of any other program that uses a 
similar process now.
    Senator Udall. For OMB to use the term duplication, it 
should not apply here in any way because this is the program 
that works for the tribes, works for individuals trying to do 
development. No other Federal agencies that offer loans have 
the specialized knowledge about trust lands that the Department 
of the Interior does.
    I would not keep repeating the word duplicative because I 
do not think it is accurate here. I think it is really unfair 
to the tribes and the people who have used this program. You 
are going to hear from Lieutenant Governor Thompson who I am 
going to ask this question.
    Do you agree with what I have just said here? Is there some 
other program you could go to that did all these other things?
    Mr. Thompson. Vice Chairman Udall and members of the 
Committee, I agree with you 100 percent. I was chomping at the 
bit to respond to some of that. I appreciate the opportunity.
    Senator Udall. Go ahead, you have the chance. Go for it.
    Mr. Thompson. I think it is imperative for us to understand 
that the Bureau of Indian Affairs has local agencies that every 
tribe works with. Those agencies have developed capacity and 
capability over decades that understand the nuances of doing 
business on Indian land to include leasehold mortgages and 
things of this nature, regarding trust land and the legalities 
and regulations.
    That capacity and capability is housed within the Bureau of 
Indian Affairs through those agencies and through programs like 
the BIA Loan Guarantee Program. Nobody else does that. That 
program helps you get that initial capital investment. Then you 
can turn around and leverage that to go to the Department of 
Commerce or USDA and use that. Each one of these programs helps 
combine to get a project done.
    When you have the BIA, Indian Affairs also approves leases 
and right-of-ways for development and economic development. 
When a tribe can go to the Bureau of Indian Affairs or their 
agencies for a lease for development of a road, a utility 
right-of-way, a gas line right-of-way, and also tell or ask for 
a loan guarantee, then get that loan guarantee and go to the 
Department of Commerce or USDA to help complete the project, it 
is imperative we understand this program works and there is no 
other place we can get that done.
    Thank you.
    Senator Udall. Lieutenant Governor Thompson, the 
President's fiscal year 2020 budget calls for eliminating 
funding for the Indian Loan Guarantee Program. I understand 
that the Indian Pueblo Cultural Center has used this program to 
finance some of its projects. Can you please share with the 
Committee how the program has enabled the Center to 
successfully develop its businesses?
    Mr. Thompson. Thank you, Vice Chairman and members of the 
Committee.
    The Indian Pueblo Cultural Center has used this program to 
finance $23 million worth of development to include one of the 
largest Starbucks in the State of New Mexico, to help fund the 
Native American Community Academy Charter School.
    We talk about community development and economic 
development. Economic development is not only about business 
development. It is also about education, housing, all of that. 
Economic development has all of those aspects.
    Indian Pueblo Culture Center has, through the BIA Loan 
Guarantee Program, financed $23 million worth of effort to help 
continue our development on the Indian School property right in 
Albuquerque.
    Senator Udall. Yes, and you would not have any place else 
to get those kinds of loans?
    Mr. Thompson. Vice Chairman Udall and members of the 
Committee, no, sir.
    Senator Udall. Ms. Sweeney, can we get the name of the 
gentleman who gave the answer for the record? He gave the 
previous answer. I was asking you the question and Mr. Stevens 
stood up but I do not think he answered.
    Ms. Sweeney. No, that was David Johnson.
    Senator Udall. He specifically answered the question about 
the collateralization.
    Ms. Sweeney. Yes. I asked Jack earlier about the statement 
that Lieutenant Governor Thompson made regarding the difficulty 
to get loans and to collateralize loans with Indian Country. I 
wanted some clarification because there were some 
miscommunications, so my apologies.
    Senator Udall. Assistant Secretary Sweeney, one of the 
reasons for the Indian Loan Guarantee Program's popularity 
among tribal borrowers is its use of trust mortgages to secure 
financing. As you know, tribes are typically unable to use 
trust lands as collateral which is what we just talked about.
    In the USDA's testimony, we learned about that agency's 
pilot program for issuing mortgages on trust lands in North 
Dakota that will help Native homebuyers. According to DOI's own 
Division of Capital Investment, which manages the Indian Loan 
Guarantee Program, the Indian Pueblo Cultural Center is a 
``beacon of success.'' Lieutenant Governor Thompson just 
testified that loans secured through the program have financed 
more than $23 million in projects.
    Why would the President propose to eliminate a Federal loan 
guarantee program that has proven so successful for tribal 
entities such as the Indian Pueblo Cultural Center? Do you have 
a plan to fill the void if the Indian Loan Guarantee Program is 
eliminated? Does DOI have comparable programs in place when we 
know they do not?
    Ms. Sweeney. Yes, Senator, I do understand that this Loan 
Guarantee Program is something that's strongly supported by you 
and members of this Committee. The President's budget is the 
President's budget and we support that.
    I want to stress that we perform services that facilitate 
economic development. As I stated earlier to Senator Murkowski, 
we perform functions within the Bureau of Indian Affairs like 
taking land into trust, like gaming, like doing environmental 
reviews that all facilitate economic development in areas like 
New Mexico.
    With my private sector background and my business and 
management background, I have taken a look at the Office of 
Indian Energy and Economic Development. I am focused on 
realigning their focus and function within that division to run 
models and do stress testing on our strategies so that we can 
craft a path forward for economic development in Indian Country 
rather than spending considerable amounts of time reviewing 
loan applications.
    There is no dispute that this is a successful program but 
that is not our core mission inside of Indian Affairs. There 
are other agencies whose core mission is to provide financial 
lending.
    Senator Udall. As I think you have heard from the 
Committee, we strongly support this. You are the top person, a 
Senate-approved person, in the Department of the Interior. When 
the President comes up with a budget, we understand when he 
sends it up, you follow it, but internally, we believe your 
role is to advocate for the programs working out there in 
Indian Country.
    There is a whole process where before the budget shows up 
here on the Hill in February. As you know, the department tells 
the President what they want in the budget and there is a pass 
back and forth. We expect you to be very outspoken internally 
about these programs that are working out in Indian Country.
    Ms. Harris, Treasury's CDFI Fund funds Native American CDFI 
assistance programs. It is doing some great work in Indian 
Country. There are four Native CDFIs in New Mexico providing 
capital to new and existing businesses and helping Native 
people become homeowners.
    While the CDFI Fund is an effective tool for economic 
growth in tribal communities, I understand it is often 
oversubscribed. What is the current demand for the CDFI Fund's 
Native American CDFI Assistance Program, financial assistance 
and technical assistance awards? Does supply meet demand?
    Ms. Harris. Thank you, Senator.
    Going off last year's round, I can tell you that supply 
does not meet demand. We were oversubscribed by almost half. We 
received requests for $34 million in grant applications. We 
awarded just a little over $15 million. It is definitely 
oversubscribed.
    Senator Udall. Do you think that is the case every year, 
that there is significant over subscription like that?
    Ms. Harris. There is significant over subscription in all 
of our programs, including the NACA Program.
    Senator Udall. The CDFI Fund has a statutory requirement of 
one to one match for all financial assistance grants which 
reportedly makes access to Native American CDFI assistance 
funds difficult for Native CDFIs who cannot raise private 
capital.
    That is why Congress, as you know, waived this dollar for 
dollar requirement for CDFIs in every fiscal year but fiscal 
year 2014. That omission in fiscal year 2014 led to 
significantly less capital going out to Indian Country.
    Without a waiver, would Native CDFIs be able to access the 
funding made available through the CDFI Fund?
    Ms. Harris. Without a waiver, as you mentioned, we would 
see a significant decline in the number of Native CDFIs that 
would have the capacity to access the funds.
    Senator Udall. That is a very, very important point. We saw 
it in fiscal year 2014 where that happened and it had a 
dramatic impact. Do you agree that the impacts would be 
devastating to Native communities where access to capital is 
already a significant challenge?
    Ms. Harris. Yes, I do.
    Senator Udall. Thank you.
    Assistant Secretary Sweeney, Chaco Canyon is a critically 
important area for tribes in the southwest but it is also home 
to very active oil and gas development activity. Late last 
year, Pueblo leaders met with Associate Deputy Secretary Jim 
Cason and Principal Deputy Assistant Secretary John Tahsuda to 
discuss ways tribes and the Administration can work together to 
protect the Chaco Canyon area.
    In that meeting, Mr. Cason invited the tribes to submit a 
proposal for an ethnographic study of the region in order to 
incorporate Pueblo religious leaders' knowledge of significant 
sites to guide responsible oil and gas development. The Pueblos 
agreed and submitted their proposal in October 2018. For the 
record, that is a very significant development, for Pueblo 
leaders to be willing to share this knowledge of sacred sites, 
as you probably know well.
    My understanding is that there have been meetings between 
Interior officials and Pueblos to discuss the parameters of the 
study but there are some key sticking points like the one area 
it would cover outside the current 10 mile buffer zone.
    Can you please provide me with an update on the progress 
being made to accommodate the Pueblos' request to cover a wide 
area of the Chaco region? We are talking greater Chaco now.
    Ms. Sweeney. Understood. Thank you.
    As you noted, there have been several meetings with the 
Pueblo governors. They were asked to submit a proposal. That 
proposal was submitted and at this time, it is my understanding 
that BLM and Indian Affairs are currently reviewing those 
proposals.
    Senator Udall. Are you personally involved in these 
discussions?
    Ms. Sweeney. I am personally involved in the internal 
deliberations, yes.
    Senator Udall. As the highest ranking tribal official in 
the Administration, I would like you to personally stay on top 
of this. It is important that the Pueblos have a voice within 
the Administration.
    I do not think there are any additional witnesses or an 
additional questioner showing up, is that correct on both 
sides?
    Obviously the record is going to stay open for a couple of 
weeks. We are going to submit questions to all of you and we 
hope you will answer those in a timely way.
    We had a second vote going on and that is why you have seen 
Senators going in and out. No disrespect to the witnesses. We 
really appreciate everything you have done today.
    I am going to gavel this hearing closed. I do not want to 
keep everyone waiting.
    [Whereupon, at 4:03 p.m., the Committee was adjourned.]

                            A P P E N D I X

                Kiran Ahuja, CEO, Philanthropy Northwest
    Chairman Hoeven, Vice Chairman Udall, and Members of the Committee, 
thank you for this opportunity to submit testimony regarding the recent 
hearing, ``Building out Indian Country: Tools for Community 
Development.'' My name is Kiran Ahuja, and I am the CEO of Philanthropy 
Northwest.
    Founded in 1976 and based in Seattle, Philanthropy Northwest is a 
membership network of more than 170 grantmakers in the six-state 
Northwest region--Alaska, Idaho, Montana, Oregon, Washington, and 
Wyoming--and also works with philanthropies in Hawai`i. Philanthropy 
Northwest partners with family funds, foundations, and corporate giving 
programs through professional development, networking, research and 
publications, public policy, and individualized consulting. Our members 
span a wide range of issues, grantmaking practices, size, and scope. 
Together, they represent nearly 50 percent of the region's 
philanthropic assets.
    Philanthropy Northwest's vision is to ensure Northwest communities 
have vibrant, healthy futures that honor our past, our people, and our 
culture. To accomplish this vision, our work is built around three key 
pillars: (1) advancing diversity, equity, and inclusion; (2) promoting 
advocacy and engagement; and (3) strengthening the philanthropic 
sector. We are committed to expanding the reach and impact of 
philanthropy across all communities in our region, and supporting the 
well-being and prosperity of Native American, Alaska Native, and Native 
Hawaiian communities--whose histories and cultures so deeply shape the 
Northwest's identity--is a fundamental value in our approach.
    Our testimony addresses the following areas:

   Philanthropic work to support Native communities. Members of 
        our network are actively and intentionally working to support 
        economic growth in Native communities.

   The importance and impact of data. Beyond specific 
        grantmaking and programmatic activities, we recognize data as 
        an underlying priority that will support investments toward 
        strengthening economic and community development. Effective 
        approaches to build and sustain thriving communities require 
        strong data about the communities intended to be served by 
        these resources. Like many partners across the sector, 
        Philanthropy Northwest views data as essential, for our own 
        work and for policy makers.

   Why the 2020 Census matters. We see the 2020 Census as a 
        critical opportunity to build accurate and reliable data that 
        will guide investments and programs to support our region's 
        most under-resourced communities, including Native communities. 
        \1\ The census plays a foundational role in the visibility of 
        Native communities' needs and the equitable distribution of 
        resources. For this reason, we believe the importance of a 
        robust and accurate 2020 Census must be part of this 
        committee's consideration of the tools for economic and 
        community development in Indian Country.

Philanthropic Work to Support Native Communities
    Federal resources and programs have an important role in supporting 
economic and community development in Native communities, and while the 
philanthropic sector cannot fill this gap, it too is a necessary 
partner and stakeholder in collaborative solutions. First Nations 
Development Institute, which works to improve economic conditions for 
Native communities through direct financial grants, technical 
assistance and training, and advocacy and policy, reported national 
data from 2006-2014 that $107 million in grants serving Native causes 
went toward economic and community development-related activities. \2\
    In the Northwest, a vital responsibility of our philanthropic 
network is to strengthen its relationship with Native communities. Our 
analysis of philanthropic funding in 2014, the last year for which we 
have published data, showed that funding to Alaska Native and Native 
American communities in our six-state region was nearly five times more 
likely than grantmaking nationwide to support Native activities, 
issues, and communities ($22.6 million regionally versus $91.6 million 
nationally). \3\
    One Philanthropy Northwest member, Northwest Area Foundation 
(NWAF), has a commitment to place 40 percent of their grant dollars 
with Native-led nonprofit partners. \4\ Serving the states of Idaho, 
Iowa, Minnesota, Montana, North Dakota, Oregon, South Dakota, and 
Washington, and the 75 Native nations that share this geography, \5\ 
NWAF provides tangible examples of how grantmaking supports economic 
and community development in Indian Country. NWAF currently provides 
$10 million in grants to 18 Native community development financial 
institutions (CDFIs), private organizations managed by Native community 
members to provide local businesses with training, education, and 
financial support. NWAF also has three mission investments in Native 
CDFIs totaling nearly $2 million that are program-related investments, 
which the foundation defines as below-market-rate investments that 
prioritize impact over financial return.

   One CDFI is located in Eastern Washington on the 
        Confederated Tribes of the Colville Reservation. \6\ Capital 
        and education provided to entrepreneurs has led to the creation 
        of multiple profitable businesses owned by residents, such as a 
        healthy foods restaurant and a daycare center, which likely 
        would not have existed without the CDFI or philanthropic 
        support behind it. \7\

   The state-recognized Little Shell Tribe of Chippewa Indians 
        in Montana needed capital to develop a limestone quarry to help 
        the Little Shell achieve financial self-sufficiency. However, 
        the tribe's lack of federal recognition prevented access to 
        federal funding. A regional CDFI, the Native American 
        Development Corporation, helped them locate a finance partner 
        to launch the project. \8\ The Native American Development 
        Corporation has assisted over 20 Native communities in the 
        Dakotas, Montana, and Wyoming, and partners with federal 
        government agencies and the Northwest Area Foundation. \9\

   A CDFI facilitator and major grantee, First Nations Oweesta 
        Corporation (Oweesta), lends and relends to CDFIs, including 
        through a growing capital pool of $10 million supported by $1 
        million in seed funding from NWAF. Additionally, a $500,000 
        grant from NWAF further supports Oweesta's lending to smaller 
        CDFIs. According to Oweesta, the relending will lead to 3,000 
        new jobs. \10\

    In addition to grantmaking, philanthropy also serves a valuable 
role as a convener to explore issues, facilitate dialogue, and promote 
partnerships. One area where Philanthropy Northwest and its members are 
deepening our work is with respect to Opportunity Zones, and 
specifically understanding how this new community investment tool can 
support future wealth building for Native communities. The six 
Northwest states have 328 Opportunity Zones. We know that rural and 
tribal areas face a built-in disadvantage to attracting Opportunity 
Zone dollars when up against more urban centers that offer a dense 
array of large, profitable real estate projects, and where investors 
are already engaged. Rural and tribal places are forming regional 
collaborations to compete, and two notable collaborations are in the 
Northwest:

   The Emerald Coast Opportunity Zone is a collaboration 
        between economic development leaders on the Olympic Peninsula 
        of Washington state representing five tribes (Jamestown 
        S'Klallam, Lower Elwha Klallam, Makah, Quileute, and Hoh), four 
        cities, two counties, and two port authorities. \11\

   The North Star Opportunity Zone is a collaboration 
        spearheaded by the Confederated Tribes of the Colville 
        Reservation in eastern Washington state. \12\

    With members of our network and partners from Native communities, 
we are convening dialogue and deepening proficiency about the role 
philanthropy might play in supporting rural and tribal Opportunity 
Zones.
    These examples offer a glimpse into how philanthropy has an 
important role in this discussion, even as we recognize that 
philanthropy can and should be doing more to support Native leadership 
in addressing economic challenges facing Native communities. Later this 
year, Philanthropy Northwest will release a report on Native giving 
that will highlight examples and best practices that Native communities 
believe are important to replicate to build out strong partnerships. 
The report will be a resource for driving more philanthropic resources 
to Native communities, and highlighting the appropriate ways non-Native 
people and institutions can support efforts that serve Native people 
and center their leadership.
The Importance and Impact of Data
    Policy and funding decisions are built upon data. However, it is 
widely known that accurate and reliable data at all levels--from 
national to local--can be difficult to obtain regarding Native 
communities. Limited data impacts the availability of resources, 
especially to tribes. For example, in the child welfare context, 
funding for Title IV-E Foster Care and Adoption Assistance goes to 
tribes that have the financial and technical infrastructure in place to 
meet extensive data reporting requirements. \13\ Contrary to the 
misconception that many tribal governments would be able to support 
this endeavor through casino revenues, many tribes without large gaming 
enterprises lack resources for these data operations. \14\ Limited data 
also hinder the ability to identify unmet needs in the Native 
community. \15\ For example, data have shown the average philanthropic 
grant for Native American causes and organizations shrunk from almost 
$160,000 in 2006 to well below $120,000 in 2014, \16\ and less than one 
percent of total grantmaking goes to these causes, which can be 
partially attributable to insufficient information and evidence 
available to grantmakers. \17\
    Data directly inform effective decisionmaking, which in turn leads 
to promising outcomes, as an example from one of our members, Yakima 
Valley Community Foundation (YVCF) in Yakima, WA, illustrates from 
their partnership with the tribal community. In 2013, YVCF invested 
$15,000 into the local collaborative Ttawaxt, which used community-
based strategies to collect data to understand factors contributing to 
disproportionate infant mortality rates among Native American infants 
in Yakima County. Community members were trained in ethical research 
processes and data collection methods, and they were paid to gather 
both quantitative and qualitative information. \18\ The analysis led to 
establishing a strong foundation to build upon, interventions, and data 
used to provide education to the professional community. \19\ YVCF 
entered back as a funding partner to Ttawaxt in 2017 and awarded the 
collaborative $150,000, which was then used to leverage and gain 
support from many other funders. Together this funding has allowed 
Ttawaxt to fine tune their community-driven services, build capacity, 
pay tribal members to implement work, and gain meaningful 
sustainability in the community, and now Ttawaxt is beginning to move 
toward their own non-profit. \20\
Why the 2020 Census Matters
    Data from many sources are important to analyzing, anticipating, 
and responding to needs in Native communities. There is no source of 
data as broadly consequential as the census. The census, which occurs 
once every ten years, is a constitutionally mandated count of the total 
number of people living in the United States. Decennial census data are 
used to accurately apportion $800 billion in federal funding, create an 
equal distribution of political representation, and inform decisions 
made by organizations across all sectors that use the data in their 
business or policy decisions. \21\
    The goal is for every person to complete the census by Internet, 
mail, or phone. However, certain populations have historically been 
undercounted in the census, such as young children, those with low 
Internet access, people in rural areas, lower-income groups, and people 
of color. \22\ Around a quarter of the Native population lives in areas 
identified as hard-to-count. Among other factors, this is due to a high 
poverty rate, lower than average educational attainment, a much younger 
than average population, a high proportion of renters versus 
homeowners, and a substantial rate of complex living situations, \23\ 
such as multi-family or extended family homes. \24\
    Stark numbers reflect the significant risk of a census undercount 
in Native communities:

   For the 22 percent of American Indians and Alaska Natives 
        who live on reservations,25 the 2010 Census yielded an 
        undercount by nearly five percent, over twice as high as the 
        second-most undercounted population. \26\

   The 2020 Census will feature a new Internet response method, 
        but almost half of those on reservations with a computer do not 
        have a high-speed Internet subscription. High-speed Internet 
        access among those who have a computer lags overall across the 
        Native population, at around two-thirds, in contrast to 82 
        percent of the rest of the population. \27\

   People who are homeless can be very difficult to accurately 
        count in the census. \28\ While American Indians and Alaska 
        Natives represent less than two percent of the country's 
        population, they comprise four percent of the sheltered 
        homeless population and five percent of sheltered homeless 
        families. \29\ In Hawai`i, which has the highest rate of 
        homelessness per capita at 487 per 100,000 people, \30\ one-
        third of the homeless population is Native Hawaiian. \31\

    Many federal programs that benefit Native communities rely in whole 
or in part on census-derived data for allocation formulas. These 
include, but are not limited to, Title I grants to local education 
agencies ($14 billion in FY2015), Head Start ($8.3 billion), and Native 
American employment and training ($58 million). \32\ Expansion funds 
for Head Start are distributed based on the number of young children in 
poverty in a particular area. This especially affects funding to Native 
communities, where nearly one-third of the population are children, 
compared to 24 percent in the general population. \33\ Many health 
programs also rely on census data. This includes those that solely 
support Native communities, such as the Indian Health Service (nearly 
$5 billion in FY2015) and the Urban Indian Health Program ($41 
million), as well as programs with high Native enrollment, such as 
Medicaid ($312 billion) or other public insurance. \34\ Housing-related 
services are also impacted by census data, such as the Indian Housing 
Block Grant ($650 million in FY2015) and Indian Community Development 
Block Grants ($70 million). \35\
    Census undercounting results in Native communities being 
inaccurately and insufficiently represented in decisionmaking. At the 
level of federal resources, this results in clear costs to health, 
security, and educational and employment opportunities for Native 
peoples across the country, weakening the infrastructure to support and 
sustain strong economies. For policy makers and philanthropy alike, an 
incomplete census count misguides us in evaluating needs, setting 
priorities, and measuring the outcomes of investments and programs.
Conclusion
    It is a priority of Philanthropy Northwest to support Native 
communities across our region, and we are committed to not only 
deepening our own work on this front, but also to working with this 
committee as a partner to promote communities' capacity to build 
healthy and sustainable economies. Through our network's own vested 
interest and familiarity with this issue, we encourage this committee 
to consider the importance of robust data, including and especially 
through the 2020 Census, as a fundamental tool to promote economic and 
community development in Indian Country.
    We look forward to continuing to be a resource to this committee. 
Our Native giving report will be released this fall, and we would 
welcome an opportunity to present at a forthcoming hearing.

ENDNOTES
     \1\ See Philanthropy Northwest. ``2020 Census.'' Accessed April 
23, 2019. https://philanthropynw.org/2020-census.
     \2\ First Nations Development Institute. ``Growing Inequity: Large 
Foundation Giving to Native American Organizations and Causes, 2006-
2014.'' 2018: 33. https://www.firstnations.org/wp-content/uploads/
publication-attachments/Growing%20_Inequity_(WEB).pdf.
     \3\ Neroulias Gupte, Nicole. ``Trends in Northwest Giving 2017.'' 
Philanthropy Northwest, March 2017: 7. https://philanthropynw.org/
sites/default/files/files/
news/Trends%20in%20Northwest%20Giving%202017.pdf. An updated Trends 
publication will be released this year.
     \4\ Northwest Area Foundation. ``Native-Led Organizations: 
Advancing economic, social, and cultural prosperity.'' Accessed April 
17, 2019. https://www.nwaf.org/native-led-organizations/.
     \5\ Northwest Area Foundation. ``About the Northwest Area 
Foundation.'' Accessed April 17, 2019. https://www.nwaf.org/about/.
     \6\ Walker, Kevin. ``Equity for Native American Communities: Using 
Mission Investments Alongside Grants.'' Stanford Social Innovation 
Review, April 1, 2019.
    https://ssir.org/articles/entry/
equity_for_native_american_communities_
using_mission_investments_alongside_grants?utm_source=Mailchimp&utm_
medium=email&utm_campaign=kw_ssir_promo&utm_source=All+Contacts
&utm_campaign=1cb3aed54f-kw_ssir_promo&utm_medium=email
&utm_term=0_169cbd0710-1cb3aed54f-428429945#.
     \7\ Scott, Clay. ``Northwest Native Development Fund: How Native 
CDFI Partnership with National Banks Can Respond to Native Communities' 
Needs for Capital and Culture.'' Northwest Area Foundation. Accessed 
April 17, 2019. https://www.nwaf.org/nndf/.
     \8\ Scott, Clay. ``Native American Development Corporation: How 
Native CDFIs Can Lead to Investment and Growth that Literally Helps Put 
Tribes on the Map.'' Northwest Area Foundation. Accessed April 17, 
2019. https://www.nwaf.org/nadc/.
     \9\ Native American Development Corporation. ``About NADC.'' 
Accessed April 17, 2019. http://www.nadc-nabn.org/about-nadc/.
     \10\ Walker, ``Equity for Native American Communities.''
     \11\ Kuh, Brian. ``An Opportunity for Jefferson County.'' Business 
Insider (The Chamber of Jefferson County Newsletter), November 2018: 6. 
https://chambermaster.blob.core.windows.net/userfiles/UserFiles/
chambers/658/CMS/JCCC_BusinessInsider_November2018_FINAL.pdf; 
McMicking, Jeannie. ``Inslee focuses on maritime industry during tour 
of Peninsula.'' Peninsula Daily News, June 8, 2018. http://
www.peninsuladailynews.com/news/inslee-focuses-on-maritime-industry-
during-tour-of-peninsula/. 
    \12\ See North Star Opportunity Zones. ``Homepage.'' Accessed April 
24, 2019. http://northstaroz.com/.
     \13\ See generally Marcynyszyn, Lyscha, Hildegarde Ayer, and Peter 
Pecora. ``American Indian Title IV-E Application Planning Process: 
Tribal Progress, Challenges, and Recommendations.'' Casey Family 
Programs. September 2012. https://caseyfamilypro-wpengine.netdna-
ssl.com/media/AmericanIndianTitleIVe.pdf.
     \14\ Chapman, Michael, David Cournoyer, and Wilma Mankiller. 
``Context is Everything: Reflections on Strengthening Partnerships 
Between the Philanthropic Community and Native Americans.'' One Fire 
Development, Inc. July 14, 2016: 10. http://
nativephilanthropy.issuelab.org/resource/context-is-everything-
reflections-on-strengthening-partnerships-between-the-philanthropic-
community-and-native-americans.html; See Marcynyszyn, Ayer, and Pecora, 
``American Indian Title IV-E Application Planning Process.''
     \15\ Chapman, Cournoyer, and Mankiller, ``Context is Everything,'' 
39.
     \16\ First Nations Development Institute. ``Growing Inequity: 
Large Foundation Giving to Native American Organizations and Causes, 
2006-2014.'' 2018: 31. https://www.firstnations.org/wp-content/uploads/
publication-attachments/Growing%20_Inequity_(WEB).pdf.
     \17\ See Chapman, Cournoyer, and Mankiller, ``Context is 
Everything,'' 3.
     \18\ Group Health Foundation. ``Tt waxt.'' Accessed April 24, 
2019: 3. https://grouphealthfoundation.org/wp-content/uploads/2018/09/
Tta%CC%81waxtJourney-MemorialFoundation_Presentation.pdf.
     \19\ Ibid, 4.
     \20\ Ibid, 5.
     \21\ Philanthropy Northwest. ``2020 Census.''
     \22\ City University of New York Mapping Center. ``HTC 2020.'' 
Accessed April 22, 2019. https://www.censushardtocountmaps2020.us/.
     \23\ The Leadership Conference Education Fund. ``Will You Count? 
American Indians and Alaska Natives in the 2020 Census.'' April 17, 
2018: 1. https://censuscounts.org/wp-content/uploads/2019/03/Fact-
Sheet-AIAN-HTC.pdf.
     \24\ Running Strong for American Indian Youth. ``The Poverty 
Cycle.'' Accessed April 17, 2019. http://indianyouth.org/american-
indian-life/poverty-cycle.
     \25\ Yurth, Cindy. ``Census: Native Count Jumps by 27 Percent.'' 
Navajo Times, January 26, 2012. https://navajotimes.com/news/2012/0112/
012612census.php.
     \26\ National Congress of American Indians. ``Census.'' Accessed 
April 17, 2019. http://www.ncai.org/policy-issues/economic-development-
commerce/census.
     \27\ Wang, Hansi Lo. ``Native Americans On Tribal Land Are 'The 
Least Connected' To High-Speed Internet.'' NPR, December 6, 2018. 
https://www.npr.org/2018/12/06/673364305/native-americans-on-tribal-
land-
are-the-least-connected-to-high-speed-Internet.
     \28\ The Leadership Conference Education Fund. ``Will You Count? 
People Experiencing Homelessness in the 2020 Census.'' July 1, 2018: 1-
2. http://civilrightsdocs.info/pdf/census/2020/People-Experiencing-
Homelessness-HTC.pdf.
     \29\ United States Interagency Council on Homelessness. ``Expert 
Panel on Homelessness among American Indians, Alaska Natives, and 
Native Hawaiians.'' September 27, 2012: 5. https://www.usich.gov/
resources/uploads/asset
_library/Expert_Panel_on_Homelessness_among_American_Indians%2C
_Alaska_Natives%2C_and_Native_Hawaiians.pdf.
     \30\ Bussewitz, Cathy. ``Hawaii struggles to deal with rising rate 
of homelessness.'' Los Angeles Times, November 15, 2015. 
https://www.latimes.com/nation/la-adna-hawaii-homeless-20151115-
story.html.
     \31\ The Leadership Conference Education Fund. ``Will You Count? 
Asian Americans and Native Hawaiians and Pacific Islanders (NHPIs) in 
the 2020 Census.'' April 17, 2018: 2. http://civilrightsdocs.info/pdf/
census/2020/Fact-Sheet-AA-NHPI-HTC.pdf.
     \32\ The Leadership Conference Education Fund, ``American Indians 
and Alaska Natives,'' 2.
     \33\ National Congress of American Indians. ``Demographics.'' 
Accessed April 17, 2019. http://www.ncai.org/about-tribes/demographics.
     \34\ The Leadership Conference Education Fund, ``American Indians 
and Alaska Natives,'' 2-3.
     \35\ Ibid, 3.
                                 ______
                                 
 Prepared Statement of the United South and Eastern Tribes Sovereignty 
                          Protection Fund USET
    The United South and Eastern Tribes Sovereignty Protection Fund 
(USET SPF) is pleased to provide the Senate Committee on Indian Affairs 
with testimony for the record of the hearing on, ``Building out Indian 
Country: Tools for Community Development.'' Rebuilding of our Tribal 
Nations includes rebuilding of our Tribal economies as a core 
foundation of healthy and productive communities. Lack of parity with 
other units of government and limited access to capital often serve as 
our greatest challenges and interfere with our ability to pursue 
economic development opportunities, which has a ripple effect 
throughout Tribal communities. USET SPF supports current legislative 
and executive efforts to advance economic development in Indian Country 
in a way that is respectful of the federal trust obligation and our 
inherent sovereignty. Below we address many of the issues and bills 
raised during the hearing, as well as some major USET SPF priorities 
that were absent.
    USET SPF is a non-profit, inter-tribal organization representing 27 
federally recognized Tribal Nations from Texas across to Florida and up 
to Maine. \1\ USET SPF is dedicated to enhancing the development of 
federally recognized Tribal Nations, to improving the capabilities of 
Tribal governments, and assisting USET SPF Member Tribal Nations in 
dealing effectively with public policy issues and in serving the broad 
needs of Indian people. This includes advocating for the full exercise 
of inherent Tribal sovereignty.
---------------------------------------------------------------------------
    \1\ USET SPF member Tribal Nations include: Alabama-Coushatta Tribe 
of Texas (TX), Aroostook Band of Micmac Indians (ME), Catawba Indian 
Nation (SC), Cayuga Nation (NY), Chitimacha Tribe of Louisiana (LA), 
Coushatta Tribe of Louisiana (LA), Eastern Band of Cherokee Indians 
(NC), Houlton Band of Maliseet Indians (ME), Jena Band of Choctaw 
Indians (LA), Mashantucket Pequot Indian Tribe (CT), Mashpee Wampanoag 
Tribe (MA), Miccosukee Tribe of Indians of Florida (FL), Mississippi 
Band of Choctaw Indians (MS), Mohegan Tribe of Indians of Connecticut 
(CT), Narragansett Indian Tribe (RI), Oneida Indian Nation (NY), 
Pamunkey Indian Tribe (VA), Passamaquoddy Tribe at Indian Township 
(ME), Passamaquoddy Tribe at Pleasant Point (ME), Penobscot Indian 
Nation (ME), Poarch Band of Creek Indians (AL), Saint Regis Mohawk 
Tribe (NY), Seminole Tribe of Florida (FL), Seneca Nation of Indians 
(NY), Shinnecock Indian Nation (NY), Tunica-Biloxi Tribe of Louisiana 
(LA), and the Wampanoag Tribe of Gay Head (Aquinnah) (MA).
---------------------------------------------------------------------------
S. 212, The Indian Community Economic Enhancement Act
    USET SPF continues to support many of the provisions within the 
Indian Community Economic Enhancement Act (ICEE). The permanent waiver 
of matching funds for Native Community Development Financial 
Institutions (CDFIs) is long overdue and a welcome provision in the 
bill. In addition, we welcome the opportunity for Native CDFIs to 
access grants through the Native American Programs Act that would 
provide CDFIs with the opportunity for development and maintenance, and 
allow them to provide assistance to Tribal Nations in the development 
of Tribal law and court systems for the purposes of regulating 
commerce, as well as Tribal master plans for economic development and 
infrastructure.
    We also offer our support for the elevation of the Director of the 
Office of Native American Business Development. Providing direct access 
from this position to the Secretary of Commerce will assist in the 
removal of some of the barriers described in the ``Findings'' section 
of the bill.
    Further, USET SPF is supportive of amendments to the Buy Indian Act 
that would require the Bureau of Indian Affairs and the Indian Health 
Service to certify that procurement from Indian businesses is not 
practicable before purchasing outside Indian Country. We also look 
forward to the issuance of a biannual report from the Departments of 
Health and Human Services and Interior regarding the implementation of 
the Buy Indian Act.
    USET SPF believes that this bill provides a variety of much needed 
change in policy and law. Additionally, we continue to note that there 
are a number of opportunities for improvement within the bill as 
introduced. These include:
   Section 2. Findings.

         While the Findings section as drafted does describe many 
        existing barriers to economic development in Indian Country, 
        USET SPF would like to see references to the deep inequities 
        Tribal Nations face under the U.S. Tax Code strengthened. 
        Through inequities in the tax code as well as state dual 
        taxation, revenue generated within Indian Country continues to 
        be taken outside our borders or otherwise falls victim to a 
        lack of parity. Moreover, Tribal governments continue to lack 
        many of the same benefits and flexibility offered to other 
        units of government under the tax code. We strongly encourage 
        the addition of stronger language within the Findings section 
        that acknowledges and seeks to lift these deep inequities.

         This is particularly important, given the failure of Congress 
        to include any Tribal priorities in the Tax Cuts and Jobs Act, 
        despite consistent advocacy from Tribal Nations across the 
        country. It is unacceptable that this once-in-a-generation 
        legislation did not include these critical, non-controversial 
        Tribal priorities. Tribal Nations across the country, including 
        USET SPF member Tribal Nations, are simply seeking parity as 
        governments and economic opportunity for their citizens under 
        the U.S. tax code.

   Section 3. Native American Business Development, Trade 
        Promotion, and Tourism Act.

         While USET SPF supports much of the language in this section, 
        including the Indian Economic Development Feasibility Study, we 
        note the absence of placeholder language found in a previous 
        version of the bill. Repeal of the ``essential government 
        function'' test in the Tribal issuance of tax-exempt bonds 
        would be critical step forward in the pursuit of parity within 
        the tax code for Tribal Nations. Currently, Tribal Nations are 
        the only governments that are limited to using tax-exempt bond 
        financing for ``essential government functions.'' The IRS has 
        interpreted this standard to exclude Tribal economic 
        development activities even though state and local governments 
        routinely use tax-exempt financing for development projects. 
        This limitation on Tribal Nations greatly inhibits 
        infrastructure deployment and economic growth. Although we 
        recognize that the addition of taxation provisions could result 
        in jurisdictional issues, USET SPF asks that language repealing 
        the ``essential government function'' test be added to the 
        bill.

S. 294, The Native American Business Incubators Program Act
    The Native American Business Incubators Program Act would establish 
a grant program to provide financial assistance for the establishment 
and operation of business incubators serving Tribal communities within 
the Department of the Interior. The growth and diversification of 
Native businesses within Indian Country is critical to economic 
sovereignty, self-determination, and Nation rebuilding. We agree that 
Native business owners face unique and greater barriers to economic 
success than many of their peers. USET SPF strongly supports this 
legislation as an opportunity to create jobs and strengthen Tribal 
economies, particularly in the USET SPF region. We further support the 
necessary authorization of funding for this program and appreciate 
attempts to ensure that the Act is not implemented at the expense of 
other equally necessary programs at Interior. We note, however, that 
opportunities under this provision come in the form of grants. We 
continue to ask that consideration be given to further supporting 
Tribal sovereignty and self-determination by providing the opportunity 
to receive these dollars through P.L. 93-638 contacts or compacts.
Urgent Need for Tax Parity
    Any conversation about community and economic development in Indian 
Country must necessarily include tax parity for Tribal Nations. As we 
note above, through inequities in the tax code as well as state dual 
taxation, revenue generated within Indian Country continues to be taken 
outside its borders or otherwise falls victim to a lack of parity. 
Despite recent national tax reform, Tribal governments continue to lack 
many of the same benefits and flexibility offered to other units of 
government under the tax code.
    On December 20, 2017, Congress passed H.R. 1, the Tax Cuts and Jobs 
Act, legislation reforming the U.S. tax code. USET SPF continues to be 
deeply disappointed that after years of advocacy, the legislation did 
not contain a single Tribal priority. Tribal Nations had spent years 
advocating for changes to the tax code that would provide for tax 
treatment reflective of our governmental status and enhance economic 
development in Indian Country. Legislation providing for these changes 
was introduced: S. 2012, The Tribal Economic Assistance Act, introduced 
by Senator John Hoeven; and S. 1935/H.R. 3138, The Tribal Tax and 
Investment Reform Act, introduced by Senator Jerry Moran and 
Representatives Lynn Jenkins and Ron Kind.
    Tribal priorities for this legislation were simple--provisions that 
would offer governmental parity and economic development for Tribal 
Nations under the tax code. And yet, these critical changes are absent 
in the Tax Cuts and Jobs Act. USET SPF calls upon Congress and the 
Administration to prioritize tax reform for Tribal Nations in future 
legislation, including tax extenders and any upcoming infrastructure 
package.
    In addition, as USET SPF has noted many times before, dual taxation 
hinders Tribal Nations from achieving our own revenue generating 
potential. Although Tribal Nations have authority to tax noncitizens 
doing business in Indian Country, when other jurisdictions can tax 
those same noncitizens for the same transactions, Tribal Nations must 
lower their taxes to keep overall pricing at rates the market can bear 
or forgo levying a tax at all. The application of an outside 
government's tax often makes the Tribal tax economically infeasible.
    Dual taxation undercuts the ability of Tribal Nations to offer tax 
incentives to encourage non-Indian business entities onto the 
reservation to create jobs and stimulate the Tribal economy. As long as 
outside governments tax non- Indian businesses on the reservation, even 
if a Tribal government offers complete Tribal tax immunity to attract a 
new non-Indian business to the reservation, that business is subject to 
the same state tax rate that is applicable offreservation. As a matter 
of economic fairness, USET SPF asks that Congress and the 
Administration work with Tribal Nations to support and advance 
initiatives that would bring certainty in tax jurisdiction to Tribal 
lands by confirming the exclusive authority of Tribal governments to 
assess taxes on all economic activities occurring within their borders.
Restoration of Tribal Homelands
    It is similarly impossible to discuss Tribal community development 
without acknowledging the critical importance of Tribal homelands 
restoration. In response to federal policies that stripped us of our 
land base, the Department of the Interior (DOI) has, for nearly 85 
years, restored Tribal lands through trust acquisitions to enable 
Tribal Nations to build schools, health clinics, hospitals, housing, 
and provide other essential services to Tribal citizens. Over this 
period, DOI has approved trust acquisitions for approximately 5 million 
acres of former Tribal homelands, which represents only a small 
fraction of the more than 100 million acres lost through Federal 
policies of removal, allotment, and assimilation.
    USET SPF Tribal Nations continue to work to reacquire our 
homelands, which are fundamental to our existence as sovereign 
governments and our ability to thrive as vibrant, healthy, self-
sufficient communities. And as our partner in the trust relationship, 
it is incumbent upon the federal government to prioritize the 
restoration of our land bases. The federal government's objective in 
the trust responsibility and obligations to our Nations must be to 
support healthy and sustainable self-determining Tribal governments, 
which fundamentally includes the restoration of lands to all federally-
recognized Tribal Nations, as well as the legal defense of these land 
acquisitions.
    No Tribal Nation should remain landless. All Tribal Nations, 
whatever their historical circumstances, need and deserve a stable, 
sufficient land base--a homeland--to support robust Tribal self-
government, cultural preservation and economic development. The Federal 
Government should ensure every Tribal Nation has the opportunity to 
restore its homelands, regardless of the concerns of other units of 
government, private citizens, or other interests. This is a necessary 
function of the U.S. government in delivering upon the trust 
responsibility and obligations to Tribal Nations.
    Regaining a land base is essential to the exercise of Tribal self-
government. When the federal government holds land in trust for a 
Tribal Nation, the Tribal Nation is able to exercise jurisdiction over 
the land, including over individuals' actions and over taxation. This 
jurisdiction allows the Tribal Nation to protect its people and to 
generate economic growth, which in turn encourages the flourishing of 
the Tribal Nation's cultural practices. Jurisdiction over territory is 
a bedrock principle of sovereignty, and Tribal Nations must exercise 
such jurisdiction in order to fully implement the inherent sovereignty 
they possess. Just as states exercise jurisdiction over their land, 
Tribal Nations must also exercise jurisdiction, thereby promoting 
government fairness and parity between state governments and Tribal 
Nation governments.
    As long as trust lands remain elusive for some Tribal Nations and 
the status of lands held in trust for others is called into question, 
opportunities for economic and community development will be hindered 
across Indian Country. USET SPF continues to call for the immediate 
passage of a fix to the decision in Carcieri v. Salazar that contains 
the two features necessary to restore parity to the land-into-trust 
process: (1) a reaffirmation of the status of current trust lands; and 
(2) confirmation that the Secretary has authority to take land into 
trust for all federally recognized Tribal Nations.
Native Community Development Financial Institutions (CDFI)
    Utilizing 50 years of technical assistance expertise and the unique 
opportunities available to our service area, the USET CDFI has been 
working to build the first regional CDFI with a focus on lending for 
Tribal Nation enterprise economic development projects. Through an 
initial award from the Department of Treasury's CDFI Fund, USET CDFI 
has been working to capitalize a loan fund, establish necessary 
oversight of the fund through the creation of a Board of Directors, and 
draft guidance documents and loan policies vital to execute lending 
activity.
    The initial award through the CDFI Fund's Native American CDFI 
Assistance (NACA) Program has been the main resource to fund this 
activity, and without this financial assistance, the establishment of 
CDFIs in Indian Country would be severely diminished. Essential to that 
financial assistance is the waiver of the $1 to $1 match required for 
recipients, especially for new, emerging CDFIs like the USET CDFI. 
Waiving this match requirement reduces the administrative burden for 
emerging CDFIs to focus more on providing technical assistance and 
financial services to disadvantaged and underbanked communities and 
individuals. Permanently waiving this requirement, as the ICEE bill 
does, will continue to expand the CDFI model throughout Indian Country 
to ensure all Tribal citizens have access to fair access to credit, 
capital, and financial services.
    USET SPF also supports the continued and expanded development of 
the CDFI Fund's capacity building initiative for Native CDFIs. The 
technical assistance and services provided through this initiative 
would have greatly assisted the development of the USET CDFI and led to 
faster deployment of lending capital.
Office of Indian Energy and Economic Development
Indian Affairs Loan Guarantee Program
    USET SPF encourages the continuation of the Indian Affairs Loan 
Guarantee Program, facilitated by the Office of Indian Energy and 
Economic Development, Division of Capital Investment. USET SPF member 
Tribal Nations have a long history of utilizing this uniquely situated 
and advantageous program. The program has led to innovative community 
economic development activity having a significant impact in Tribal 
communities.
    USET SPF strongly disagrees that this program is duplicative of any 
other loan guarantee program offered throughout the federal family. It 
is the only program to facilitate loan financing for borrowers in 
Indian Country and continues to have one of the lowest default rates 
throughout all federal loan guarantee programs, illustrating to lenders 
that Indian Country is a good investment. Eliminating this program 
would lead to a decline in an already under-financed landscape of 
Tribal community and economic development projects. Elimination would 
also compound the undue burden of Tribal Nations having to educate non-
Native investment and guarantee programs on the unique and complex 
lending issues on federal trust lands and with Tribally-owned 
Enterprises. We urge Congress to restore funding for the program in the 
Fiscal Year 2020 appropriations process.
Universal Commercial Codes
    USET SPF encourages the continued build-out of technical assistance 
for Tribal Nations to draft and implement government programs to 
facilitate investment and economic development in Tribal communities; 
specifically, the development of Universal Commercial Codes. The Office 
of Indian Energy and Economic Development has previously partnered with 
other government programs to provide training sessions for Tribal 
Nations on how to implement a model commercial code. Reinstituting 
these trainings would provide necessary assistance to Tribal Nations in 
implementing principled strategies to build sound economic development 
frameworks that support vibrant Tribal economies. In addition, the 
technical assistance curriculum would benefit from the addition of 
training on transaction recording and filing.
Minority Business Development Administration (MBDA)
    USET SPF supports the continued outreach of the MBDA to Indian 
Country and technical assistance to support the development of Tribal 
entrepreneurship. We support and look forward to future Board Agency 
Announcements funding technical assistance programs to Tribal Nations 
in the USET SPF region. Currently, there is no designated Native 
American Business Enterprise Center in the USET SPF region. This 
excludes of USET SPF member Tribal citizens' and Tribally-owned 
enterprises from participating in MBDA programs. USET SPF encourages 
the equitable expansion of the Native American Business Enterprise 
Center (NABEC) Program across Indian Country, including the Tribal 
Nations in our region.
U.S. Department of Agriculture
Broadband
    USET SPF encourages continued broad, cross-agency support, 
including USDA Rural Development, in providing technical assistance and 
guidance on instillation, development, and utility management for 
Tribal Nations to development communication and broadband projects. As 
has been reflected by others, having reliable connectivity for 
communications and Internet service is vital to the health and safety 
of all communities and local economies, none more-so than Tribal 
communities. However, we continue to stress that any infrastructure 
build-out, whether on- or off- Tribal lands, cannot come at the expense 
of Tribal consultation, sovereignty, sacred sites, or public health.
Farm Bill Implementation
    In addition, USET SPF recognizes that the 2018 Farm Bill contains a 
host of new opportunities for community and economic development in 
Indian Country. As USDA begins implementation of this law, it is 
critical that Tribal Nations are meaningfully consulted throughout the 
process. This includes ensuring that Tribal guidance and expectations 
are incorporated before rulemaking can conclude. Senate Committee on 
Indian Affairs should exercise its oversight authority and 
responsibilities to ensure that this occurs.

                                  [all]