[Senate Report 106-149]
[From the U.S. Government Publishing Office]




                                                       Calendar No. 269

106th Congress                                                   Report
  1st Session                    SENATE                         106-149

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



 
   PROVIDING FOR BUSINESS DEVELOPMENT AND TRADE PROMOTION FOR NATIVE 
                   AMERICANS, AND FOR OTHER PURPOSES

                                _______
                                

               September 8, 1999.--Ordered to be printed

                                _______


   Mr. Campbell, from the Committee on Indian Affairs, submitted the 
                               following

                              R E P O R T

                         [To accompany S. 401]

    The Committee on Indian Affairs, to which was referred the 
bill (S. 401) to provide for business development and trade 
promotion for Native Americans, and for other purposes, having 
considered the same, reports favorably thereon with an 
amendment in the nature of a substitute and recommends that the 
bill as amended do pass.

                                Purpose

    The purpose of S. 401 is to provide for business 
development and trade promotion for Native Americans, and for 
other purposes.

                               Background

    Native Americans suffer from high unemployment and poverty 
rates, poor housing and health care, and substandard education. 
By all measures and compared to all other groups in the United 
States, Native Americans occupy the bottom rung on the social 
and economic ladder. Various studies and congressional 
oversight hearings on barriers to economic development on 
Indian lands continue to identify, among other factors, the 
lack of a vigorous private sector as a major impediment to 
Native American economic progress.\1\
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    \1\ The numerous regulatory and structural impediments to Native 
American economic development have been well-documented. SAR A. Levitan 
and Elizabeth I. Miller, The Equivocal Prospects for Indian 
Reservations: An Occasional Paper (May 1993) (an unpublished 
manuscript, on file with the Center for Social Policy Studies); 
Department of Interior, Report of the Task Force on Indian Economic 
Development (July 1986); Presidential Commission on Indian Reservation 
Economies, Report and Recommendations to the President of the United 
States (November 1984).
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    The following are some statistical measurements 
illustrating the dire need for economic and community 
development in Indian country:
    Employment and Income.--In March of 1999, the United States 
reached a 29-year low with an unemployment rate of 4.2%. 
However, the unemployment rate for American Indian and Alaskan 
Native populations continues to hover at 50%, with some Native 
communities suffering unemployment rates of 80-90%. In 
addition, American Indians and Alaskan Natives have the highest 
poverty rate in the country at 30%. These statistics reflect a 
variety of factors including poor physical infrastructure, lack 
of human capital, lack of access to financial capital, a long-
standing dependence on federal transfer payments, and an almost 
non-existent private sector economy in Native communities.\2\
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    \2\ Stephen Cornell and Joseph P. Kalt, What Can Tribes Do? 
Strategies and Institutions in American Indian Economic Development 3 
(1992).
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    Housing.--The American Indian and Alaskan Native 
populations live in housing that is often, and justifiably, 
compared to third world nations. One out of every five Indian 
homes lacks complete plumbing facilities. Over 90,000 American 
Indians and Alaskan Natives are homeless or under-housed. In 
addition to scarce and poor quality housing stock, an 
aggravating factor in the housing market is the lack of private 
sector capital and mortgage lending.
    Infrastructure.--In 1995, the National Tribal Development 
Association (NTDA) conducted a study and determined that most 
tribes lack the basic physical infrastructure that is necessary 
for economic and community development. Tribes have limited 
access to energy, water, transportation, and technical 
assistance designed to develop this infrastructure. For 
example, there are over 50,000 miles of roads in Indian country 
and less than half these roads are paved. In addition, 73% of 
all tribal water treatment facilities are considered 
inadequate.
    After years of failed federal programs, Indian economies 
remain stagnant. For Indian country to prosper and foster 
healthy economies, private investment is necessary. S. 401 is 
fueled by the belief that the federal government can work more 
efficiently with tribal governments, along with the private 
sector, to boost economic development in Indian country. As a 
complementary matter, better coordination of federal Indian 
economic development programs and resources will promote 
greater efficiency as tribes, tribal members, private sector 
representatives, and individuals engage in business development 
on Indian lands.

                  SUMMARY OF THE PROVISIONS OF S. 401

    S. 401 addresses several barriers to job creation and 
economic development in Indian country and establishes an 
Office of Native American Business Development in the 
Department of Commerce to promote both intra-agency and inter-
agency coordination of federal programs that affect Indian 
economic development.\3\ In addition, this Office will 
coordinate a Native American trade and export promotion program 
to encourage Native American entry into international trade and 
commercial transactions. S. 401 also authorizes the Secretary 
to facilitate the development of five tourism demonstration 
projects. Finally, S. 401 requires the Free Trade Zone Board 
and the Secretary of Treasury to expedite the processing of any 
applications involving the establishment of a foreign-trade 
zone (FTZ) and port of entry on Indian lands, respectively.
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    \3\ The General Accounting Office has previously recommended the 
creation of an agency solely responsible and accountable for the 
coordination of Indian economic programs to develop a consolidated, 
national Indian economic development policy. General Accounting Office, 
Improving Federally Assisted Business Development on Indian 
Reservations (June 27, 1975). Based on the reasoning of this GAO 
report, the Committee believes that greater intra-agency and inter-
agency coordination undertaken by the Department of Commerce would 
significantly improve business and community development in Native 
communities.
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    It is the Committee's view that because of its many 
business and economic development offices and missions that the 
Department of Commerce is the best suited government entity to 
undertake the provisions of S. 401. Both the mission and the 
supporting agencies of the Department of Commerce provide a 
solid foundation for Indian economic development. The mission 
of the Department of Commerce is to ``* * * promote job 
creation, economic growth, sustainable development and improved 
living standards for all Americans by working in partnership 
with business, universities, communities, and workers.'' In 
addition, key economic development resources are housed in the 
department, including the International TradeAdministration, 
Technology Administration, National Telecommunications and Information 
Administration, the Patent and Trademark Office, the Economic 
Development Administration, and the Minority Business Development 
Agency, among others.

                      Section-By-Section Analysis

Section 1. Short title

    The title of this bill is the Native American Business 
Development, Trade Promotion, and Tourism Act of 1999.

Section 2. Findings; purposes

    This section sets forth the findings of the Congress which 
recognizes the special government-to-government relationship 
between Indian tribes and the United States. The United States 
has an obligation to guard and preserve tribal sovereignty and 
to foster strong tribal governments, Indian self-determination, 
and tribal economic self-sufficiency. Presently, American 
Indians and Alaskan Natives suffer the highest rates of 
unemployment, poverty, poor health, substandard housing, and 
associated social ills in the nation.
    The United States has an obligation to assist Indian tribes 
in the creation of appropriate economic and political 
conditions to encourage investment from outside sources and to 
facilitate economic ventures with outside entities. The 
economic success of Native American communities often depends 
on the combined and coordinated efforts of the federal 
government, tribal governments, the private sector, and 
individuals. The goals of economic self-sufficiency and 
political self-determination are furthered if private sector 
resources, economic capital, and technical expertise are 
available to Native American Communities.
    The purposes of this Act are: (1) to revitalize 
economically and physically distressed Indian reservations and 
Indian lands, (2) to promote private investment in Indian 
economies, (3) to promote long-range sustained growth in Native 
economies, (4) to reduce poverty levels and achieve a higher 
standard of living in Native Communities, (5) to encourage 
trade and business development for tribal members and 
governments, and (6) to promote economic self-sufficiency and 
political self-determination for Indian tribes and their 
members.

Section 3. Definitions

    The following terms are defined in this section: Board, 
Eligible Entity, Indian, Indian Goods and Services, Indian 
Lands, Indian-Owned Business, Indian Tribe, Secretary, Tribal 
Enterprise, and Tribal Organization.

Section 4. Office of Native American Business Development

    This section establishes an Office of Native American 
Business Development (hereinafter ``Office'') within the 
Department of Commerce. This Office is to be headed by a 
Director. The Secretary of Commerce (hereinafter ``Secretary'') 
through the Director is to coordinate federal technical and 
financial assistance programs to aid eligible entities in the 
development of business opportunities, the expansion of trade, 
and economic development.
    The Office is also to engage in inter-agency coordination 
of federal programs and resources relating to Indian economic 
development, including, but not limited to, any programs in the 
Departments of Commerce, Interior, the Small Business 
Administration, and Labor. For example, the American Indian 
Business Leaders organization has undertaken an initiative to 
develop an Indian youth education curriculum that is centered 
on business development in Native communities. This innovative 
education curriculum is a good example of a project where joint 
participation from the Departments of Education and Commerce 
would be highly beneficial.
    Other duties to be undertaken by this Office are the 
coordination of intra-agency programs within the Department of 
Commerce including, but not limited to, the following: (1) 
federal programs that provide legal, accounting, and financial 
assistance, (2) market surveys, (3) development of promotional 
materials, (4) business development seminars, (5) facilitation 
of marketing, (6) participation in trade fairs, (7) other 
related activity that promotes the development or appropriate 
markets, and (8) other appropriate activity. Other assistance 
the Secretary is to provide includes financial, technical, and 
administrative services, and other such assistance that the 
Secretary in consultation with the Director, determines to be 
necessary for the development of business opportunities on 
Indian lands.
    The Secretary is directed to give priority to economic 
development programs that provide the greatest degree of 
economic benefit to Indians and foster long-term stable 
economies. This Office is prohibited from assisting any 
activity directly related to the operation of Indian gaming 
activities pursuant to the Indian Gaming Regulatory Act.

Section 5. Native American trade and export promotion

    The Secretary is authorized to out a Native American export 
and trade promotion program. The Secretary is to ensure the 
coordination of federal programs to develop tribal economies 
and stimulate the demand for Indian goods and services. In the 
process of coordinating federal programs, the Secretary is to 
provide federal technical or financial assistance, development 
of promotional material, the financing of appropriate trade 
missions, the marketing of Indian goods and services, the 
participation of the appropriate federal agencies or entities 
in international trade fairs, and any other activity related to 
the development of markets for Indian goods and services. In 
addition, the Secretary is to provide technical assistance to 
help eligible entities identify and enter markets, comply with 
foreign and domestic laws, and develop financial arrangements 
to aid in importing and exporting Indian goods and services. 
Priority is to be given to activities that provide the greatest 
degree of economic benefit to Indians and foster long-term 
international markets for Indian goods and services.

Section 6. Intertribal tourism demonstration projects

    This section requires the Secretary to institute a Native 
American tourism program through the development of tourism 
demonstration projects. The intent of this legislation is to 
encourage the development of tourism projects by Indian tribes 
on a tribal, intertribal, and regional basis. The Secretary is 
to work with the Secretary of Agriculture in the planning, 
development, and implementation of these tourism development 
demonstration projects.
    The Secretary, through the Director, is directed to select 
certain pilot projects to participate in this program. 
Selection of the pilot projects is to be based on the 
following: (1) development of educational and promotional 
materials, (2) development of educational resources to assist 
both public and private tourism development, (3) and the 
coordination of tourism related joint ventures between eligible 
entities and state or local governments. The Secretary is 
authorized to award grants to carry out these pilot projects in 
the following locations: the Four Corners Area, the Pacific 
Northwest (as determined by the Secretary), Oklahoma, the Great 
Plains (as determined by the Secretary), and Alaska.
    The Secretary is directed to provide financial, technical, 
and administrative assistance to the participants that are 
selected to carry out these tourism projects. This assistance 
is to aid in feasibility studies of the projects, market 
analyses, participation in tourism and trade missions, and 
other activity deemed appropriate. In addition, the tourism 
projects are to include provisions to facilitate the 
development and financing of tourism-related infrastructure, 
including reservation roads.

Section 7. Report to Congress

    Within one year of the date of enactment, the Secretary is 
required to prepare and submit a report to Congress summarizing 
the activities conducted by the Secretary in carrying out 
Sections 4 (Office of Native American Business Development), 5 
(Native American Trade and Export Promotion), and 6 
(Intertribal Tourism Demonstration Projects) of this Act. The 
report is to include recommendations for legislation that the 
Secretary determines is necessary to aid in furthering Sections 
4 through 6 of this Act.

Section 8. Foreign-trade zone preferences

    In this section, the Free Trade Zone Board shall expedite, 
to the maximum extent practicable, the processing of any 
application involving the establishment of a foreign trade zone 
on Indian lands, including Indian lands that have been 
designated as an empowerment zone or enterprise community. As 
part of this process, the Secretary of the Treasury is to give 
priority to applications for ports of entry on Indian lands and 
expedite the processing of these applications. In evaluating 
the foreign-trade zone applications, both the Foreign Trade 
Zone Board and the Secretary of Treasury are required, to the 
maximum extent possible, to approve foreign-trade zones and 
ports of entry applications in connection with Indian lands.

Section 9. Authorization of appropriations

    This section authorizes the appropriation of such sums as 
are necessary to carry out this Act.

                          legislative history

    The Native American Business Development, Trade Promotion, 
and Tourism Act of 1999 (S. 401) was introduced on February 10, 
1999, by Senator Campbell, for himself, and for Senator Inouye, 
with Senators Hatch, Murkowski, and Wellstone becoming 
cosponsors at later dates. An earlier and similar version of S. 
401, was introduced on April 30, 1998 by Senator Campbell, and 
was referred to the Committee on Indian Affairs where a hearing 
was held on October 1, 1998. S. 401 was referred to the 
Committee on Indian Affairs and a hearing was held on the bill 
on April 21, 1999. On June 16, 1999, the Committee on Indian 
Affairs convened a business meeting to consider S. 401 and 
other measures that had been referred to it. The Committee 
favorably reported a substitute amendment to S. 401.

            committee recommendation and tabulation of vote

    On June 16, 1999, the Committee on Indian Affairs, in an 
open business session, adopted an amendment-in-the-nature of a 
substitute to S. 401 by voice vote and ordered the bill, as 
amended, reported favorably to the Senate.

                    cost and budgetary consideration

    The cost estimate for S. 401 as calculated by the 
Congressional Budget Office, is set forth below:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, July 9, 1999.
Hon. Ben Nighthorse Campbell,
Chairman, Committee on Indian Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 401, the Native 
American Business Development, Trade Promotion, and Tourism Act 
of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Megan 
Carroll.
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

S. 401--Native American Business Development, Trade Promotion, and 
        Tourism Act of 1999

    CBO estimates that implementing S. 401 would cost $23 
million over the 2000-2004 period, assuming appropriation of 
the necessary amounts. The bill would not affect direct 
spending or receipts; therefore, pay-as-you-go procedures would 
not apply. S. 401 contains no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
and would impose no costs on state, local, or tribal 
governments. This bill would authorize activities intended to 
benefit Indian tribes.
    S. 401 would direct the Secretary of Commerce to establish 
the Office of Native American Business Development to provide 
financial, technical, and administrative assistance to eligible 
Indian entities to enhance the economies of Indian tribes. The 
bill would authorize the appropriation of whatever funds are 
necessary for that purpose. S. 401 would direct the new office 
to establish a Native American export and trade promotion 
program and would authorize grants to eligible Indian entities 
to develop intertribal tourism demonstration projects in five 
Indian area. The bill also would require the office to report 
annually to the Congress on these programs Finally, S. 401 
would direct the Secretary of the Treasury to expedite the 
processing of applications to establish foreign trade zones in 
Indian enterprise zones.
    Based on information from the Department of Commerce, CBO 
estimates that implementing these provisions would require a 
total of about $25 million in new budget authority over the 
2000-2004 period. Assuming appropriation of the necessary 
amounts, CBO estimates outlays of $3 million in 2000 and about 
$5 million in each of fiscal years 2001 through 2004.
    The CBO staff contact is Megan Carroll. This estimate was 
approved by Robert A. Sunshine, Deputy Assistant Director for 
Budget Analysis.

                      REGULATORY IMPACT STATEMENT

    Paragraph 11(b) of rule XXVI of the Standing Rules of the 
Senate requires that each report accompanying a bill to 
evaluate the regulatory paperwork impact that would be incurred 
in implementing the legislation. The Committee has concluded 
that enactment of S. 401 will create only de minimis regulatory 
or paperwork burdens.

                        executive communications

    The Committee has received no official communication from 
the Administration on the provisions of the bill.

                        changes in existing law

    In compliance with subsection 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill are required to be set out in that accompanying 
Committee report. The Committee finds that enactment of S. 401 
will not result in any changes in existing law.

                                
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