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Impending Government Shutdown May Hit Tribal Nations Particularly Hard

Rural tribal governments that heavily depend on federal funding may see relatively more furloughs and service stoppage.

Yurok guides paddle tourists along the Klamath River in traditional canoes hand crafted from Redwood trees. Tribes in rural or remote areas like Yurok face drastic impacts from federal government shutdowns.

It was 2013 and Susan Masten was vice-chairperson of her nation, the Yurok Tribe of Northern California. The government shutdown was in its second week. During an interview at the time, Masten talked about how she would soon have to furlough an additional 74 of the tribe’s 310 employees (60 had already been sent home). One hundred college scholarships would go unpaid, and childcare would be suspended for 50 families.

Yurok has around 4,000 citizens with half living in or around their homelands.

“It did impact everyone’s family and it wasn’t easy,” Masten said. “It wasn’t as bad as it could have been, because we did have a reserve.”

Federal government shutdowns drastically impact Indigenous nations, especially smaller, more rural tribal governments that rely more heavily on federal dollars and agencies to run their programs.

The Yurok Tribe is located in a rural area making it difficult to create a robust and lucrative gaming facility, a business that is a lifeline for some tribal governments. In general, being so remote makes it difficult for the tribe to create any enterprises.

“If your budget is limited and so dependent on grants and government funding and that funding is cut, and that’s your only source of employment or services, that has a heavy impact to your tribal members for services and for employment,” Masten said. “So, you don’t have a choice but to lay people off because there are no reserves.”

Once again, the nation is on the cusp of a possible government shutdown with the Freedom Caucus threatening to let it happen if their demands are not met. One of those members is freshman U.S. Representative Josh Brecheen, Choctaw, who on Tuesday posted to Facebook, “Senate Democrats want to send another $6 BILLION to Ukraine, but they’re against securing our own border? No, thank you. I oppose.”

Brecheen has been outspoken about cutting government spending.

Before the Sept. 30 deadline, Senate Democrats are pushing to pass a stopgap funding bill with a continuing resolution that would avoid a government shutdown with the hope that it makes its way to the House floor for a vote, increasing pressure for House Republicans to get it passed.

The impacts to Indigenous governments, enterprises and small businesses go even further than furloughs. All government contracts, grants and funding come to a halt. There isn’t anyone to help with technical questions during a time when tribal governments are closing out fiscal year 2023 budgets.

Drawdowns can’t be completed or initiated. A drawdown is when federal funding from government accounts are placed into a tribe’s account.

“So you complete a task and then you submit your drawdown. Well, if there isn’t an employee there to do the drawdown, then you don’t get your money,” Masten said. “Or if you have a question or concern that needs to be answered, so that you can finish the grant application to request a drawdown, then you can’t complete it.”

Per the U.S. Constitution, treaties are the highest law of the land. Due to trust and treaty obligations, Indigenous nations rely on the federal government to provide those treaty rights such as healthcare, education and more.

“Indian Country is vulnerable anytime there’s any lack of government support. Because Indian Country relies so heavily on that relationship with the federal government, any type of government shutdown has a huge trickle-down effect to our communities,” said Chris James, executive director for the National Center on American Indian Enterprise Development.

The federal government employs many Indigenous people. American Indians and Alaska Natives work in the public sector at a higher rate than the general public, according to U.S Bureau of Labor Statistics. One-third of those employed, in places designated as American Indian and Alaska Native areas, are in the public sector, basically state, federal or tribal governments.

Previously, James worked for the federal government and weathered a furlough during a government shutdown in 2013. He was working for the U.S. Small Business Administration. He had three small children and was living in Washington, D.C., where the cost of living is among the highest in the country.

“I wasn’t sure how long I could go out without having any income. Just like every American, if you don’t have income coming in, it makes you very nervous,” said James, Eastern Band of Cherokee.

In his new role, he worries about the impact on Native American-owned small businesses and the ripple effect of that through Native nations and families.

James is from Cherokee, North Carolina, at the base of the Great Smoky Mountain National Park where some 10 million visitors come annually.

Tourism and gaming are two big industries for Indigenous nations. In the United States, tourism is the number one service export. Native American tourism is a $14 billion dollar industry. A quarter of Indigenous-owned businesses are in the hospitality sector. During a government shutdown, consumer spending drops.

“An impact to that is when the shutdown [happens] the parks all close,” James said. “So not only does it hurt our tribe but those businesses that rely on tourism, especially in the fall and winter time, there’s no tourists that are coming through that area. So a huge impact to small businesses.”

Loans and technical support provided by the Small Business Administration to Indigenous-owned businesses stall. According to the National Center on American Indian Enterprise Development, funding came to a standstill for various tribal entities and some tribes reported losses of over $200,000 during the 2019 shutdown.

“A lot of our small businesses might be in the process of getting a loan, or maybe they are relying on some other contracts from the federal government. If and when the government shutdown happens, all of that stops, the processing of the loan stops, the contracts stop,” James said. “There are some very high-level contracts that a lot of our Native businesses have through the Department of Defense, those may not have much disruption, but they may not get paid for a number of months. Then the employee, the employee piece, we have a number of our tribal citizens who work for the federal government. They may work for the park service. They may work for the [Bureau of Indian Affairs]. They may work, actually, for one of the agencies in D.C. So, having that impact on employees when you furlough hundreds of thousands of employees, that really has an impact.”

For the first time, the Indian Health Service, thanks to advance appropriations, won’t be as heavily impacted as before. The agency has been guaranteed funding through fiscal year 2024. Government shutdowns highlight why advance appropriations are necessary for departments and agencies that provide services for Indigenous nations.

The clock is ticking, and every hour the nation gets closer to another government shutdown. The last shutdowns were in 2013 and 2018.

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