By Levi Rickert
“Reputation in Indian Country is priceless because it is a small world. Integrity is critical,” says Ben Nuvamsa, the former chairman of the Hopi Tribe and founder and CEO of KIVA Institute.
In order to maintain integrity, Nuvamsa believes tribal business enterprises and American Indian tribes need to do things in a business-like manner.
Armed with a bachelor’s of science degree from Northern Arizona University and experience working in various capacities at the Bureau of Indian Affairs, in 2005 Nuvamsa established KIVA Institute, a firm specializing in assisting American Indian tribes to build their capacity.
“Tribes are in great need for technical expertise in basic management and operation of their governments, in managing their federal awards, and in creating resources to sustain their tribes. As Natives, we understand the needs of our tribal nations,” Nuvamsa says.
In addition to working for the BIA, Nuvamsa served as chairman of the Hopi Tribe for two years, which allows him to have an understanding on how elected tribal leaders make their decisions for tribal business enterprises.
“As tribal chairman, I dealt with land issues, sacred sites, economic development issues; and trying to secure the best deal for the tribe with dependable business partners,” Nuvamsa says.
Nuvamsa’s broad history in working in Indian Country has given him deep insight into how tribes can stay out of trouble when it comes to federal grants compliance and other areas of business to keep integrity in the close-knit world of Indian Country.
He shares his vast knowledge in the following interview:
KIVA opened its doors in 2005. During my tenure in the Bureau of Indian Affairs, I noticed that tribes lacked basic knowledge and capacity to manage their federal contracts and grants. I also noticed that federal funding agencies do not step up to provide the essential tools for tribes to manage their programs. The Indian Self-Determination Act requires the Bureau of Indian Affairs and the Indian Health Service to provide technical assistance to fill the gap that tribes need, but both agencies have failed miserably to provide this assistance to tribes.
Other federal agencies award grants to tribes based on the merits of their proposals, and require tribes to comply with the strict terms and conditions of the grants. But the awarding agencies rarely provide the help that tribes need to successfully operate the programs. The sad consequence is that tribes fall out of compliance, fail to complete audits, spend funds inappropriately, have tremendous amounts of disallowed costs, or have their grants terminated.
KIVA’s philosophy is that of “Building Capacity in Indian Country” by guiding and empowering tribal nations so they can do the work themselves. Our priority is to help build the institutional knowledge and capacity of the tribes.
KIVA’s special expertise is in Pub. L. 93-638, the Indian Self-Determination & Education Assistance Act. Our training and consulting programs focus on the act, regulations and related topics, such as federal audits, accounting principles, such as indirect costs, contract law and administration, OMB Super Circular [Office of Management and Budget guidance regarding federal awards], grant writing and administration. These are basic laws and requirements that most tribes do not understand, nor do they have direct access to technical assistance that they desperately need. I used my personal experience, education and background as policy advisor and as principal negotiator for the Bureau of Indian Affairs in developing the Pub. L. 93-638 regulations that are used today by tribes, in shaping the mission of KIVA. We also provide training and consulting on tribal governance areas such as tribal council leadership, Robert’s Rules of Order, organizational development, policy development, code development, economic development and strategic planning.
We even helped one tribe build a large justice center, using the Pub. L. 93-638 contract mechanism, funded by BIA funds. We also assisted a tribe build a hydroelectric dam using the Pub. L. 93-638 process and using funds from the tribe’s Indian water rights settlement act.
Our staff and associates specialize in Indian law and policy development, contract and grant management, accounting, audits, tribal governance, tribal legal statutes, and tribal justice services. They have years of practical experience in working with tribal nations as practitioners and as advisors; and have a good understanding of the needs of the tribes.
When called upon, KIVA can create a team to help tribes address certain situations. For example, if a tribe is having difficulty completing its audits, to effectively close out its fiscal year, our team can assist to bring records to an auditable condition.
If a tribe has been placed on high-risk status by a federal awarding agency, we can address the deficiencies, compliance issues, audit findings; and assist in removing the high-risk designation.
If tribes have contract dispute issues, we can assist in the dispute resolution process. Or if a tribe or tribal enterprise has certain internal issues, we can create a team with the right kind of expertise to come and help reorganize the enterprise and address management issues. Our team of accountants, attorneys, or grants specialists can develop ways to provide solutions, resolve the issues, and take the extra step to train the staff.
KIVA has served many tribes, tribal employees, and federal agencies since its inception. We have trained thousands of tribal and federal employees, tribal and federal officials. Our clientele spans throughout Indian Country, in the United States and in Canada. But we are only touching the tip of the iceberg. There are many more tribes that need the type of services that we offer.
The best opportunities available to tribes is in the areas of renewable energy. Renewable energy is perhaps the next big wave of economic development that tribes can get into, much like what gaming has been for tribes.
Tribes have abundant untapped natural, renewable energy resources available for this type of industry. Isolation, in this instance, is best suited for solar and wind energy development.
Some tribes are fortunate to have abundant surface water resources like rivers to develop hydroelectric or hydrokinetic energy resources. Some have geothermal resources. And some have forest lands and woodlands that can be used to develop co-generation plants to produce electricity and other byproducts.
Many tribes do not have these resources, but they have plenty of sunshine, high winds and open spaces. These resources, coupled with their status as sovereign nations and federal recognition, provides great opportunities for creating successful and sustainable industries to create tribal revenues and permanent jobs.
The renewable energy industry, virtually, has no “sunset” like the gaming industry. With constantly increasing population, metropolitan areas and industry will always need electricity. Renewable energy is cleaner than using fossil fuels to generate electricity. It goes hand-in-hand with our tribal values and teachings, and mandates for being good land stewards…taking care of Mother Earth.
During my career in the Bureau of Indian Affairs, I often dealt with leasing of tribal lands, complying with federal and tribal environmental laws, rights-of-way, appraisals, and other land issues. As tribal chairman, I was fortunate to partner with an energy development group that has access to technology and a considerable amount of investment capital that we can deploy in creating sustainable economies on tribal lands. However, one must be careful on your selection of business partners.
The fundamentals of creating renewable energy enterprises is no different from creating other enterprises. Developing financial assumptions and projections, return on investment calculations, are the same. Creating an energy enterprise requires considerable study on the technical requirements and nuances of the industry, the federal tax exemptions, energy credits, accelerated depreciation and other benefits that accrue to tribes, which provide incentives for investors and developers.
Unfortunately, tribes are most susceptible to predators; and that’s why it is very important for tribes to conduct thorough due diligence to make sure developers, investors, and outside attorneys are legitimate and have a record of success. Far too many times have tribes been on the losing end of shady business deals. Tribal sovereignty, and tribal sovereign immunity, is perhaps the best tools and protection that tribes have.
Tribes can establish their enterprises as tribal chartered corporations, or Section 17 corporations (Section 17 of the Indian Reorganization Act), taking advantage of their sovereign status and immunity from suit. As sovereign nations, tribes enjoy other benefits like federal (and state) energy credits, tax exemptions, accelerated depreciation that bring significant advantages to tribal corporations. Outside developers realize how valuable tribal sovereignty can be, and tribes can use this status to attract developers and investors. Tribes can exercise their sovereignty by structuring their agreements to require the dispute resolution and mediation processes, or legal actions to be handled within the confines of their jurisdiction (within their laws). Tribes can impose bonding requirements (bid bonds, cash bonds, performance bonds, payment bonds) on companies. Tribal councils can reserve their right to cancel or terminate the agreements and contracts for violation of tribal laws or violations of the contracts and agreements. Tribal governments also have a sovereign power to exclude any person or organization from the reservation.
KIVA has assisted several tribes to correct contract deficiencies, resolve audit issues, address and improve performance issues, and successfully remove the “high risk” designation which allowed for continued funding of federal contracts and grants. Assistance varies from updating or developing new management policies and procedures (finance, property, purchasing, personnel). Or it involved helping the tribe to bring its accounting records current to help the tribal financial records to be “audit ready.”
This work required helping with identifying source documents, reconciling accounts including bank accounts, addressing contract and grant deficiencies by preparing and submitting SF-425s [a type of federal financial report] and performance reports to bring the tribes in compliance with grant terms. It also involved helping a tribe during the alternative dispute resolution process to address a significant amount of disallowed costs.♦