In terms of generating revenues, tribes are unique in the mix of governments within the United States. Most of our people are poor, and tribal land is largely held in trust by the federal government. As a result, tribes cannot rely on taxation to generate government revenue to provide services for their citizens, as is the case with other governments.
Instead, tribes create government business enterprises, using the profits to build roads, water treatment plants, schools, clinics and to provide health care and educational opportunities for their people.
The operation of these tribal government enterprises - casinos, hotels, energy plants or agricultural farms - must be done in a manner that is open and accountable to tribal citizens. Tribal citizens “own” the enterprises. The enterprises must be culturally appropriate and in keeping with tribal traditions and values, the criteria of tribal government enterprises cannot always be gauged by profit-and-loss columns.
Tribal government enterprises are, in fact, more accountable to citizens of a tribe than corporations are accountable to their shareholders. Most non-Indian businesses and publicly-held corporations issue reports to their shareholders and updates about the overall business process. But rarely do executives seek out shareholders to consult on business decisions. With tribal enterprises, the relationship with citizen “shareholders” is far more intimate.
Separating tribal business enterprises from undue influence of the tribal government also is a challenge facing the 21st century Indian governments as they mature and progress. Several tribal nations have been able to create successful business arms that operate independently from direct government oversight while developing and acquiring profitable businesses on behalf of the tribal government owner.
A tale of successAfter my tenure as chairman of the Yavapai Apache Nation ended, I formed my own company to serve as a strategic advisor to tribal governments. In reaching out to tribes, I am amazed at the progress Native nations have made in strengthening their governments and building tribal economies.
It is impressive that, within the challenging framework of a tribal government, American Indian casinos have become the fastest-growing segment of the nation’s legal gaming industry. Commercial casino gaming outside Las Vegas has been largely stagnant for more than a decade, limited to 11 states, while tribal government gaming has spread to 28 states and continues to show double-digit growth.
Tribal business leaders have proven astute in expanding their industry into resort tourism. It shows that, when given an equal playing field and the freedom to exercise their sovereignty, tribes can dominate an industry.
More importantly, tribal government gaming has provided Native nations with valuable business experience, planting the seeds of a growing and vast tribal economy that now includes not only gaming, tourism and hospitality, but agriculture, energy, manufacturing and real estate development.
I believe tribes must, of course, prioritize rebuilding their communities, strengthen their governments, build diversified and sustainable economies and create clean, safe and culturally rich places to live.
It is also important that tribes buy Indian, developing strategic business relationships with other Native nations and expand the Indian Country economy.
Diversifying tribal economiesExpansion of gaming and diversification into nongaming business opportunities is the natural movement in the growth process for tribes. Gaming remains the primary enterprise of many tribes.
This base gaming economy has enabled tribes to focus on developing their governmental infrastructures and providing necessary services for their communities. Tribes are focusing on creating laws and formalizing their governmental structures. Clearly, economic development must be viewed as a priority. But legal and social institutions provide the necessary foundation for sustainable economic growth for generations to come.
While the institution building process is taking place, economic development within a tribal system has many priorities, including: gaming expansion; vertical integration; business diversification; investment planning; the separation of business oversight from direct government involvement; growth and development of existing business; mergers and acquisitions of existing business; and supporting development of small businesses by individual tribal citizens.
By approaching economic development in a systematic way, tribes can continue to further their sovereign rights and provide a stable economic future for generations to come.
Indian Country is on the verge of creating a vast Native American economy.
Tribes need to first develop their own healthy economic systems. There must then be a consistent, ongoing commitment by tribes, tribal trade associations and firms doing business in Indian Country to funnel opportunities and resources into tribal economies while developing a buy Indian mindset.
Economic development and diversification in Indian Country will need a consistent, long-term commitment.