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Indian nickel

Rez economic study hindered by missing data—and mistrust


Montana tribes and reservations pump billions into the state’s overall economy even though they suffer unemployment rates that average 65 percent, a new study shows.

The newly released report was conducted by RJS & Associates, an Indian-owned consulting firm based on the Rocky Boy’s Indian Reservation. The study was contracted by the State-Tribal Economic Development Commission, an advisory body created by the 1999 Legislature to help find ways of improving reservation economies.

The report, which commission members were expected to review this week at a meeting in Polson, indicates that tribal payrolls contribute about $2.2 billion a year to Montana’s economy, with each of those dollars circulating an estimated five times in local and regional markets. The figure doesn’t include tribal government expenditures for goods and services or federal agency payrolls and work-related expenditures.

“It runs into the many billions when you look at it all,” says Robert J. Swan, the consulting firm’s president and lead investigator.

The $46,000 report was designed to examine, among other topics, tribal government and private business operations, existing infrastructure and related needs, land use, employment rates, banking services, and education systems on each of the state’s seven reservations.

Swan says his study team ran into numerous roadblocks that make the report less than comprehensive. For one, he says, several tribal governments were changing administrations during the study period, which slowed down or in some cases halted the flow of information. In addition, the Bureau of Indian Affairs and Indian Health Service largely refused to cooperate with the study, which led to a lack of data about their federal operations in the state.

In further defense of the project, which some parties are privately criticizing as insufficient, Swan says the study contract was let out too late for the report to be presented to the 2001 Legislature, which was expected to review the findings. Swan says the complications caused the 300-page study to go over budget by about $20,000, an expense his firm was forced to absorb.

“I wish we didn’t have to eat that much, but we did it because we made a commitment to get it done,” Swan says, adding that part of the difficulty accessing information came from inherent tribal distrust of state government.

The study team made four trips to each reservation to gather tribal records and distribute questionnaires. Because only three reservations released payroll and housing authority data and only four reservations provided information on their educational institutions, some findings were reached using a per-capita formula for the non-reporting tribes.

“While no fault lies with any individual entity, a better line of communication with distinct responsibilities for each organization should have been made clear from the beginning of the study,” the report notes.

Questionnaire responses were also lower than anticipated, and only 30 business leaders submitted their views to the team. A total of 100 responses were collected from community-wide questionnaires, including 31 from American Indian students attending the University of Montana. More than 90 percent of the individuals surveyed said all of their salaries were spent off reservations in either border towns or larger commercial centers, “stimulating economies other than their own,” the report read.

Using 2000 U.S. Census figures, the report shows that Montana’s Indian population grew by 15.9 percent between 1990 and 2000, compared to a 12.9 percent growth rate for the rest of the state. The number of tribal members residing on reserves ranges from 96.3 percent on the Rocky Boy’s Reservation to as low as 26.7 percent on the Flathead Reservation.

The study found, however, that the Flathead Reservation has the lowest unemployment rate among Montana reservations, at 37 percent. Conversely, the Blackfeet Reservation, at 74 percent, ranked highest in the jobless category. The study team pegged the average statewide unemployment rate for all of the state’s reservations at a disturbing 65 percent.

“The bad news is that all seven Indian reservations are enduring an economic catastrophe, the likes of which have only been seen in the most impoverished Third World countries,” the study concludes. “The good news is that there exists a large pool of untapped labor on each reservation should possible private-sector business choose to locate there.”

The study says the Salish and Kootenai tribal government has a $19 million annual payroll and its housing authority pays out $2.3 million in wages each year. Salish Kootenai College weighed in with a $5 million annual payroll, while the federal Kicking Horse Job Corps Center posted $2.1 million in wages.

Multiple questionnaire respondents said that tribes and the state should work toward expanding reservation gaming as an economic development tool. They also said that non-Indian bankers need to become more knowledgeable about tribal systems—especially sovereignty issues and land-ownership policies—so the financial needs of tribal members can be better met.

Respondents in numerous cases also took on their own tribal governments, saying they sometimes impede economic growth through mismanagement, corruption and nepotism.

“The people they put in charge to operate the various programs/projects usually do not have any concept on how to do the project,” said one anonymous respondent. “The folks who come into the program have researched projects that are half-baked. When a person has a good, researched plan, they either don’t qualify because of income or some stupid red tape or federal guideline.”

“Too many chiefs and not enough Indians,” another commentator opined.

On the state side, political leaders and agency officials should work with tribes to develop more low-interest loans, provide more business management training, expand tourism promotion and offer more technical assistance. One respondent said tribes should be given wider latitude to levy their own taxes on reservation businesses.

“Be more honest in dealings with Native Americans as a sovereign nation,” wrote another study participant. “It seems any time a reservation becomes financially successful, the state government wants a piece of the pie. If they can’t muscle their way into some of the capital, they’ll sabotage the ventures for the tribe.”

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