Indian Affairs assistant secretary faces scrutiny over decision giving for-profit corporations access to funds tribes say were intended for them alone.
The Department of the Interior. | Alex Wong/Getty Images
By ADAM CANCRYN
04/16/2020 05:16 PM EDT
Updated: 04/16/2020 07:41 PM EDT
A high-ranking Interior Department official is under fire over her role in securing access to billions of dollars in coronavirus aid for a handful of wealthy Alaska corporations, including one that previously employed her as a lobbyist and top executive.
Assistant Secretary for Indian Affairs Tara Sweeney is among a small group of Interior officials advising the Treasury Department on how to distribute $8 billion in rescue funding Congress earmarked for Native American tribes — an allocation that some lawmakers now say they intended solely for the 574 federally recognized tribes hit hard by the economic shutdown.
But the Trump administration indicated this week that it also plans to include more than 200 for-profit Alaska Native corporations among the eligible recipients based on a strict reading of language Congress included in its $2.2 trillion coronavirus rescue package — including corporations that rank among the largest businesses in the state.That’s outraged many tribal leaders who say the decision could divert nearly half the funding away from tribes and into the coffers of the corporations.
Sweeney’s role has since come under intense scrutiny, with Democrats and several tribal organizations seizing on the financial interest she retains as a shareholder of her former employer, Arctic Slope Regional Corporation, according to financial disclosure forms.
“Tara Sweeney is diverting funds for tribal governments during coronavirus to for-profit Alaska Native Corporations,” Senate Minority Leader Chuck Schumer tweeted on Thursday. “Sweeney used to be an exec for an ANC, and she wants to profit!”
At least one tribal organization this week called for her resignation over the issue, telling Treasury Secretary Steven Mnuchin and Interior Secretary David Bernhardt that “she has lost the confidence of Indian tribes.”
“Sweeney must be removed because she cannot be trusted to advise Treasury on Alaska Native Corporations,” the Great Plains Tribal Chairmen’s Association, which represents 16 Midwestern tribes, wrote in a letter on Tuesday.
Sweeney fired back at Schumer on Thursday afternoon, calling his accusation “an ignorant and despicably low attack that could not be further from the truth” and emphasizing that the administration is following the language passed by Congress.Assistant Secretary Tara Sweeney✔@ASIndianAffairs
@SenSchumer Even for you, this is an ignorant and despicably low attack that could not be further from the truth. Perhaps you should read the law you negotiated and voted for as Alaska Natives are entitled to receive the funding from @USTreasury. https://www.bia.gov/covid-19/cares-act … https://twitter.com/senschumer/status/1250812458442334208 …Chuck Schumer✔@SenSchumerPres. Trump’s @ASIndianAffairs Tara Sweeney is diverting funds for tribal governments during coronavirus to for-profit Alaska Native Corporations.
We can’t put these corporations before tribal governments & people.
Sweeney used to be an exec for an ANC, and she wants to profit!329Twitter Ads info and privacy249 people are talking about this
The Interior Department also defended Sweeney’s work on the fund, saying in a statement that “to suggest she has personal motives or that she is attempting to divert funds away from American Indians is completely false.”
Some tribes are discussing suing the government as soon as Friday to prevent Alaska Native corporations from receiving aid allocated for tribes, Kevin Allis, the chief executive of the National Congress of American Indians, said in an interview.
The National Congress of American Indians has argued that the language in the law doesn’t allow for the corporations to receive aid designated for tribes. The group hasn’t called for Sweeney to resign, but Allis said she should have recused herself from the matter because of her financial stake in Arctic Slope Regional.
“It just doesn’t look good,” he said. “Right or wrong, it doesn’t look good.”
Alaska Native corporations were created by Congress as part of a 1970s settlement of Alaska Native land and financial claims, with Alaska Native villagers given stock in the businesses. But they are separate from tribal governments in the state, and over the past several decades a handful of regional corporations have become massive entities — ranking among the nation’s largest government contractors, and wielding outsize influence on Capitol Hill compared with tribal governments.
That includes Arctic Slope Regional, a conglomerate whose businesses include government contracting and operations in industries like energy and construction. It’s now the largest locally owned and operated corporation in Alaska.
Arctic Slope Regional declined to comment for this article.
Sweeney — a former top lobbyist for Arctic Slope Regional — in recent weeks participated in multiple meetings with tribal leaders about the fund and its application process. That included leading one session held solely for Alaska Native villages and corporations, according to two people with knowledge of the call and meeting notes obtained by POLITICO.
Administration officials in a separate call with Hill staff characterized Sweeney as directly involved in work with Treasury on the fund — a role that included thinking through how best to distribute the money, one person familiar with the call said.
In a federal ethics agreement signed after her 2018 nomination to the Interior Department, Sweeney pledged not to “participate substantially in any particular matter in which I know that I have a financial interest directly and predictably affected by the matter” without first obtaining a waiver.
The agreement also prohibited Sweeney from working on issues affecting Arctic Slope for two years. That period expired last month. Still, during her May 2018 Senate confirmation hearing, Sweeney vowed repeatedly to stay away from anything related to Arctic Slope’s interests.
“I would have done that regardless of the pledge,” she told Sen. Tom Udall (D-N.M.), referring to her ethics agreement. “Because it is the right thing to do.”
Yet Sweeney has been closely involved in discussions with tribal governments about the $8 billion in coronavirus aid, and led a team of Interior officials tasked with advising Treasury on how to allocate the funding, five people with knowledge of the process said.
Native publication Indianz.com first reported on Sweeney’s involvement, and the administration’s plans to include Alaska Native corporations among the funding recipients.
An Interior spokesperson said Sweeney has complied with all laws and regulations, and that “career officials determined that there are no statutory or regulatory prohibitions” that would limit her from work on the fund that the department characterized as “policy guidance.” The department also noted that she took part in individual calls with other tribal groups, including the Great Plains Tribal Chairmen’s Association.
Officials with the Treasury and Interior departments contend that the decision to grant Alaska Native corporations eligibility is rooted in language Congress approved as part of its $2.2 trillion coronavirus package, which made the $8 billion available to “Indian tribes” based on a definition of the term that included nongovernmental entities like Alaska Native corporations.
“Treasury must follow the law and provisions that were prescribed and passed by Congress, and mandated to the administration,” an Interior Department spokesperson said.
Members of Alaska’s congressional delegation have thrown their support behind the inclusion of Alaska Native corporations, arguing that Democrats and Republicans alike signed off on the language.
“Congress directed this — it’s clear as day,” Sen. Dan Sullivan (R-Alaska) said in an interview, calling Schumer’s attack on Sweeney a “bunch of bullshit” and an attempt at character assassination. “It’s going to be a little embarrassing when he finds out he signed off on that definition.”
Sen. Lisa Murkowski (R-Alaska), Rep. Don Young (R-Alaska) and Sullivan sent a letter to Mnuchin and Bernhardt on Tuesday, which was obtained by POLITICO, pushing for Alaska Native corporations to be allowed to receive the aid. “Like tribal enterprises in the Lower-48, the impact of the pandemic on ANCs in Alaska is reduced incomes and increased unemployment,” they wrote.
In a statement, Murkowski said Schumer’s tweet betrayed “an utter lack of understanding of what Native Corporations are, why Congress created them, and the purpose they serve in Alaska.”
“Tara Sweeney is doing an outstanding job as Assistant Secretary for Indian Affairs,” she said. “Barely two weeks ago, Congress unanimously agreed that ANCs should be eligible for funding under the CARES Act and we expect Treasury to uphold and follow the law.”
Still, some Capitol Hill staffers have since told POLITICO the provision was sloppily worded, and in late March several House lawmakers submitted official statements seeking to clarify that the money should go to cover budget shortfalls faced by tribal governments.
“This fund would be used by tribal governments to offset the dramatic losses they are facing at this time,” Rep. Tom Cole (R-Okla.), who co-chairs the House’s Native American Caucus, wrote in a colloquy entered into the Congressional Record.
A spokesperson for Cole said Thursday a bipartisan group is working to clarify that the fund was intended solely for tribal and Alaska Native governments.
Udall, the top Democrat on the Senate Indian Affairs Committee, also wrote to Mnuchin and Bernhardt on Tuesday that the funds were “intended for Tribal governments and should not be diverted.”
Yet a Treasury form distributed to tribes and tribal organizations this week gives applicants the option to list their total shareholders, according to a copy obtained by POLITICO. The form also asks for information on applicants’ employee base and land ownership — factors that tribal leaders say could skew funding toward Alaskan corporations that together control nearly as much acreage as every tribe in the lower 48 states combined.
At one point during the Monday call with Alaska Native tribes and corporations, Sweeney told an executive for Bering Straits Native Corporation that she would seek guidance from Treasury on the corporation’s behalf on whether applicants could include subsurface land — such as the company’s mineral rights — in that land ownership calculation, according to the meeting notes obtained by POLITICO.
Bering Straits did not respond to a request for comment. But the company’s CEO, Gail Schubert, was among four Alaska Native corporation executives to express support for Sweeney and the administration’s decision in a Thursday op-ed.
That’s pitted the corporations and administration against many organizations representing tribes in the lower 48 states.
“It frankly is a cash grab by state-chartered Alaskan corporations,” said Cherokee Nation Principal Chief Chuck Hoskin Jr., whose tribe is one of several that has lobbied in recent to exclude the for-profit businesses. “They’re going to use a massive, massive land base and they’re going to use shareholder information to make their case for a disproportionate amount of those funds.”
Hoskin would not go as far as to call for Sweeney’s resignation, saying he still hopes the decision is reversed. And an Interior spokesperson on Thursday pointed to a defense of Sweeney mounted by Louisiana’s Tunica-Biloxi tribe.
But other tribes now say they’ve now lost faith in her over the funding decision, and that giving Alaska Native corporations access to the fund could raise other thorny dilemmas, including that Alaska Natives could be double-counted due to their status as shareholders and members of separate Alaska Native villages. If so, it would further tilt distributions in favor of a single state’s entities.
The Alaska Native corporations, meanwhile, are also eligible to apply for federal funds through a separate program meant to aid small businesses that excludes tribal governments.
“Both of these situations could not have been the intent of Congress,” the National Congress of American Indians wrote in a letter to Mnuchin.
Tribal leaders and organizations are now rushing to lobby the administration to reverse itself, while pressuring Congress to explore a potential fix. But several representatives said they’re also wary of further delaying delivery of whatever aid they will receive, and that the suggestion Alaska Native corporations could qualify for the $8 billion fund blindsided them.
There was no discussion by Treasury or Interior officials across two initial hourslong sessions with tribes about whether corporations would be included, according to representatives on the call and a transcript reviewed by POLITICO.
“If this was the decision of the department, that their interpretation was that this was eligible for Alaska Native corporations, I don’t think they were very up front,” said one tribal representative. “It’s not a slush fund. This is real.”
Theodoric Meyer contributed to this report.