Tribal lawsuits force government to turn over 60 percent of Covid-19 money

WASHINGTON. – After dozens of tribal governments sued the U.S. Treasury Department for withholding Covid-19 pandemic relief money that Congress allotted them six weeks back, the federal executive branch announced on May 5 that it is releasing 60 percent of the $8-billion set-aside.

“Payment to tribes will begin today based on the population allocation, and will take place over several banking days,” Treasury Secretary Steven Mnuchin and U.S. Interior Secretary David Bernhardt said in a joint statement.

The $8 billion was the sliver of an overall $150 billion assigned to tribal, state, local and territorial governments in the CARES Act, or Coronavirus Aid, Relief and Economic Security Act, signed into law on March 27, by U.S. President Donald Trump.

Congress had mandated the emergency funding release by no later than April 27. However, while all the rest of the CARES Act beneficiary governments were enjoying their relief provided in a timely fashion, the tribes found it necessary to file two lawsuits against Secretary Mnuchin to obtain even a fraction of their share after the deadline.

Following the second tribal governments’ lawsuit, which called on April 30 for a full payout in 24 hours, the Presidential Cabinet leaders took five days to announce that the 60-percent distribution would happen over an unspecified number of days more.

“We are pleased to begin making $4.8 billion in critical funds available to tribal governments in all states,” Secretary Mnuchin said.

“Thanks to President Trump and Secretary Mnuchin for working with Congress to pass the CARES Act as historic financial support will now begin to be disbursed to Native Americans battling the Covid-19 health crisis,” said Secretary Bernhardt.

“I appreciate the Secretary of the Treasury’s determination in providing a clear pathway to get these resources promptly delivered,” he added.

The first of the tribal governments’ complaints over the withheld funding arose from Interior Department Assistant Secretary of Indian Affairs Tara Sweeney’s advice to the Treasury Department to channel about half of the tribal government CARES Act budget to for-profit Alaska Native Corporations.

The complaint resulted in a preliminary federal court injunction responding favorably to plaintiffs with a ruling that “no Alaska Native Corporation is eligible for any share of the $8 billion allocated by Congress for tribal governments,” because the ANCs are for-profit businesses.

Sweeney is an Alaska Native, former employee and lobbyist of the largest of the 13 Alaska Native Corporations, and a current stockholder.

She did not disclose that her husband Kevin Sweeney is a registered lobbyist for Bristol Bay Native Corporation, which was among the first companies to apply for CARES Act funding intended for tribal governments, according to the non-profit Western Values Project.

This prompted the U.S. House of Representatives Committee on Natural Resources to call on the Office of Inspector General May 1 for a probe of her activities.

U.S. Code at 18 U.S.C. 28, dedicated to ethics and conflict of interest, requires officials to recuse themselves from working on projects in which their spouses have financial interest.

“The fact that Assistant Secretary Sweeney meddled in this decision before she came clean about her and her family’s finances certainly raises some serious questions,” remarked Western Values Project Director Jayson O’Neill.

While the ANCs are temporarily enjoined from receiving the money, the court still must hear argument and rule on whether they ever will, prompting Mnuchin to observe:

“The pending litigation has introduced additional uncertainty into the process of implementing the allocation and making payments to the tribes, but Treasury is endeavoring to make payments of the remaining amounts as promptly as possible consistent with the department’s obligation to ensure that allocations are made in a fair and appropriate manner.”

Plaintiff Rosebud Sioux Tribal President Rodney Bordeaux took issue with distributing the $4.8 billion on the basis of population, as announced by the Cabinet members, who stated in writing,

“The path forward agreed to by the Secretaries will: Distribute 60 percent of the $8 billion to tribes based on population data used in the distribution of the Indian Housing Block Grant (IHBG), subject to a floor of $100,000.  This data is based on U.S. Census figures and is already familiar to tribal governments.”

President Bordeaux criticized the rationale of tribal governments’ familiarity with the formula to justify what he called the “race-based” criteria of Census-established IHBG distribution.

Rather, he said, “The Constitution — 5th and 14th Amendments — mandate that Treasury use tribal enrollment as the criteria for federal funds allocation because tribal membership is a recognized political status flowing from the inherent sovereignty of Indian nations and tribes.”

Writing in an opinion piece for the newspaper of the National Congress of American Indians (NCAI), Bordeaux added, “With political status criteria available, the Constitution prohibits Treasury’s use of race-based criteria.”

He concluded, “Note to Treasury: Please follow the Constitution and our treaties.”

Mnuchin maintained, “Our approach is based on the fair balancing of tribal needs.”

(Contact Talli Nauman at talli.nauman@gmail.com)

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