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Qualla 2020: Diversifying the Qualla Economy

Qualla 2020: Diversifying the Qualla Economy. Fourth Meeting May 21, 2014. Agenda - Morning. 9:00 Welcome and Introduction 9:15 Trust Land Law and Regulation - Presentation 10:00 Real Estate Action Plans 10:45 Knowledge Industries – Presentation 11:15 Knowledge Industry Action Plans

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Qualla 2020: Diversifying the Qualla Economy

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  1. Qualla 2020:Diversifying the Qualla Economy Fourth Meeting May 21, 2014

  2. Agenda - Morning 9:00 Welcome and Introduction 9:15 Trust Land Law and Regulation - Presentation 10:00 Real Estate Action Plans 10:45 Knowledge Industries – Presentation 11:15 Knowledge Industry Action Plans 12:00 Lunch

  3. Agenda - Afternoon 12:30 Review Potential Action Plans; Add New Ones - Enterprise Structure - Tourism - Small Business 2:30 Next Steps, Assignments 3:00 Adjourn

  4. Qualla 2020 Goals • The purpose of the Qualla 2020 Project is to diversify the Cherokee economy and reduce its risks so that it can better ensure the well-being of the Cherokee population into the future.  • In order to do this, the Qualla 2020 Project will seek to mitigate the dependence of the economy on gaming revenues, and to develop and expand businesses in ways that uphold the core values of the Cherokee people.

  5. Qualla 2020 Process • Six Committee meetings • Tuesday, February 25, 9:00 am – 3:00 pm  • Friday, March 21, 9:00 am – 3:00 pm  • Yellow Hill Activity Center (Old Hardware Store) • Wednesday, April 23, 9:00 am – 3:00 pm  • Wednesday, May 21, 9:00 am – 3:00 pm • Friday, June 27, 9:00 am – 3:00 pm • Tuesday, July 15, 9:00 am – 3:00 pm • Task teams will meet by phone between Committee meetings to develop detailed action plans for Committee review • Committee will choose action plans to recommend to EBCI Administration, EBCI Tribal Council and Cherokee Preservation Foundation

  6. Action Plan Definition • Action plan criteria: • Achievable with the resources controlled by institutions and individuals on the Qualla Boundary • Create visible differences within a year or two • Support traditional Cherokee values and culture • Action plan elements: • Goal • Participants • Activities • Organizational leadership • Resources required • Funding sources • Timeline

  7. Agenda - Morning 9:00 Welcome and Introduction 9:15 Trust Land Law and Regulation - Presentation 10:00 Real Estate Action Plans 10:45 Knowledge Industries – Presentation 11:15 Knowledge Industry Action Plans 12:00 Lunch

  8. Trust Land Law and Regulation • In order to streamline and simplify the leasing process, it will be critical to have oversight of leasing moved from the BIA to the Tribe. There are three key legal and regulatory areas that are important to understand: • EBCI Statutory Law – individual possessory holdings • HEARTH Act – leasing regulations for trust land • Contracting and Compacting – Tribal assumption of part or all of the Realty function • We also will look briefly at state property tax on the Boundary

  9. EBCI Statutory Law: Individual Possessory Holdings • The EBCI Attorney General holds that because of the specific way in which EBCI land is held in trust, individual possessory holdings are governed by EBCI statute, not by federal law • Section 47 - Real Property of the Cherokee Code contains the statutes governing real property; Section 47-4 stipulates the rights granted to a member when a possessory holding is issued • The fact that the individual possessory holdings are governed by EBCI statute implies that EBCI Tribal Council has the authority to change the statutes governing individual possessory holdings without having to consult with the BIA Source: Hannah Smith, Attorney General’s Office

  10. EBCI Statutory Law: Individual Possessory Holdings • The way that the law is currently written involves the BIA in leasing. Section 47-4(f): • “The possessory holder may grant leases or permits on this possessory holding to a member, or nonmember of the Band for a definite period of time and for a prescribed consideration, in accordance with the then applicable rules and regulations of the Bureau of Indian Affairs and the Tribe, and subject to the approval of the Business Committee and the Secretary of the Interior or his authorized representative.” • This law clearly requires the BIA to be involved in leasing – but this law can be changed without the BIA’s involvement or consent.

  11. HEARTH Act – Overview • HEARTH Act (Helping Expedite and Advance Responsible Tribal Home Ownership Act of 2012) establishes new framework for leasing tribal trust lands • The HEARTH Act allows all tribes to opt-out of the secretarial approval requirement when leasing their own lands for the first time in the history of federal Indian law. In effect, the HEARTH Act restores tribes’ inherent authority over the use and development of their own lands. Details adapted from Bryan Newland, Fletcher PLLC

  12. HEARTH Act • To opt-in, tribes must adopt their own leasing regulations • Tribal regulations must be approved by the Secretary of the Interior • Secretary has 120 days to review tribal regulations • Law is limited to tribally-owned trust lands • Doesn’t apply to individually-owned lands • Law is limited to surface leasing • No oil & gas leasing Details adapted from Bryan Newland, Fletcher PLLC

  13. HEARTH Act Requirements • Tribal regulations must: • Be “consistent” with BIA’s leasing regulations • Establish an environmental review process • Environmental review process requirements • Identification of significant environmental effects • Public notice and comment • Tribe must respond to substantive public comments • NOTE: NEPA doesn’t apply > this is a tribal process Details adapted from Bryan Newland, Fletcher PLLC

  14. Tribes Whose Regulations Have Been Accepted Under HEARTH Act 1. Graton Rancheria (CA) 2. Pueblo of Sandia (NM) 3. Pokagon Band of Potawatomi (MI) 4. Ak-Chin Indian Community (AZ) 5. Santa Rosa Band of Cahuilla Indians (CA) 6. Citizen Potawatomi Band (OK) 7. Ewiiaapaayp Band of Kumeyaay Indians (CA) 8. Kaw Nation (OK) 9. Dry Creek Rancheria (CA) 10. Jamestown S’Klallam (WA) 11. Mohegan Tribe (CT) 12. Wichita and Affiliated Tribes (OK) Details adapted from Bryan Newland, Fletcher PLLC

  15. Taking Over the Realty Function:Contracting and Compacting • Tribes have the authority to take over a part (contracting) or all (compacting) of the administrative functions performed by the BIA, the HIS, and other government entities. • EBCI has already compacted the administration of the Cherokee Indian Hospital from the HIS • More than 100 tribes have compacted one or more functions • Legal framework: • Self-Determination contracts are authorized under the 1975 Indian Self Determination and Education Assistance Act. • Self-Governance compacts are made possible by 1994 amendments to the 1975 Indian Self Determination and Education Assistance Act. From Self-Governance: The Red Book by The Office of Self Governance

  16. Self-Determination Contracts (Realty) • Tribe negotiates with local BIA Agency/Area • Tribe agrees to provide specific services that otherwise would be provided as part of the activities of the BIA • The Tribe is paid a specific amount (fixed price) for each contracted service • The Tribe submits quarterly reports on expenditures in each contract • BIA rules, regulations and manual apply • The BIA has ultimate responsibility for ensuring services are delivered appropriately. From Self-Governance: The Red Book by The Office of Self Governance

  17. Self-Governance Compacts (Realty) • Tribe negotiates with Office of Self-Governance (DC) • Tribe agrees to take over an entire function that otherwise would be provided as part of the activities of the BIA. This may include Realty Services and Title Plant • Tribe may redesign programs and activities within that function • Tribe must have appropriate data and management system, such as BIA Trust Asset and Accounting Management System • Tribe has an annual funding agreement from the BIA for the function (not program by program or service by service) • The Tribe submits quarterly reports on total expenditures; has authority to shift expenditures within function (up to a limit) • BIA rules and regulations apply, but Tribe may replace BIA guidelines with its own guidelines. BIA manual doesn’t apply. • The Tribe has the ultimate responsibility for ensuring that services are delivered appropriately. From Self-Governance: The Red Book by The Office of Self Governance

  18. Lummi Tribe: Example of Realty Compact

  19. Advice on Compacting • Confederated Salish and Kootenai Tribes (CSKT) began compacting BIA Real Estate Services in 1990’s and added BIA Title Plant Services in 1994 • BIA compact revenue is $5.6 million annually. CSKT supplements this with its own funds to improve the quality of service. • CSKT advice for other Tribes considering compacting: • Be extremely well-prepared and flexible before beginning self-governance negotiations. • Backlog issues • Reporting requirements • Is there a passion for providing these services? • Tribe and BIA should both be flexible and recognize the importance of a continued partnership after the initial self-governance compact

  20. State Taxation of Property on the Boundary • North Carolina property tax is levied by counties both on real estate and on business property (computers, office equipment, etc.). • NC regards a long-term lease as being real property, and therefore subject to property tax • NC holds that when the Tribe or a Tribal member enters into a long-term lease with a non-member, the non-member will owe property tax to the local county on the value of the leasehold interest and business property whether or not the property is on the Boundary. • Example: Food Lion Shopping Center – the lessee is paying property tax to Jackson County • New BIA regulations (25 CFR Part 162) suggest that NC’s view is not correct, and no property tax can be levied on the Boundary, regardless of who holds the lease

  21. Agenda - Morning 9:00 Welcome and Introduction 9:15 Trust Land Law and Regulation - Presentation 10:00 Real Estate Action Plans 10:45 Knowledge Industries – Presentation 11:15 Knowledge Industry Action Plans 12:00 Lunch

  22. Real Estate Action Plans • Two action plans under development for review today • Create implementation plan for compacting BIA Realty function • Develop draft statutes to required to change individual possessory holding legal framework • EBCI Attorney General’s Office, Commerce Department and Finance Department are actively reviewing HEARTH Act, so no need for an action plan on this subject

  23. Create Implementation Plan for Compacting BIA Realty Function • Goal:create an implementation plan for compacting the BIA Realty function. • What questions should the implementation plan answer? • Options: What are the potential different options for compacting the Realty function? • Finances: • How much it would cost the Tribe to take over the function? • How much money would the BIA pay the Tribe to provide the service? • Operations: • What are the requirements in terms of people, software, and machines? • What will be the impact on jobs? • Examples: What other tribes have done this and what has their experience been?

  24. Create Implementation Plan for Compacting BIA Realty Function • Activities: • Assessment of current Tribal Land Records documents management by BIA • Analysis of Realty Services workflow and procedures • Recommendations and modifications to Land Records Management database schema • Estimate of the initial startup implementation cost • Estimate of the long-term operating cost • Organizational leadership – Commerce Department • Organizational participants in addition to Commerce • Tribal Housing Program - Paulette Cox • EBCI Courts – Hannah Smith and her staff • Chief’s Office - Paxton Myers • Finance – Corey Blankenship or his designee • GIS Office – David Wyatt

  25. Create Implementation Plan for Compacting BIA Realty Function • Resources: • Hiring of independent contractor to facilitate development of implementation plan and development of new procedures • $15,000 • Travel cost for GIS office staff site visits to two other Tribes and National Tribal GIS conference • $14,000 • GIS database schema modification cost and custom workflow programming • $20,000 • Supplies • $1,000 • Total cost of implementation plan development: $50,000 • Funding sources - TBD • Timeline – 18 months

  26. Develop Draft Statutes for Individual Possessory Holding Legal Framework • Goal: • Fund the legal work required to conduct research on how/whether other tribes have changed statutes regarding individual possessory interests, and to develop draft statutes and regulations that would simplifying the process for leases and sales of individual possessory interests • Activities: • Engage outside expert counsel • Survey relevant tribal experience • Review existing EBCI statutes, regulations and case law • Develop initial draft of new proposed statutes and review with Executive and Tribal Council leadership • Public comment and community engagement • Prepare final draft of new proposed statutes for submission to Council • Develop regulations and procedures required to fully implement new statutes • Resources required: approximately $40,000 for research, legal drafting and community engagement • Funding sources – TBD • Timeline – 18 months

  27. Agenda - Morning 9:00 Welcome and Introduction 9:15 Trust Land Law and Regulation - Presentation 10:00 Real Estate Action Plans 10:45 Knowledge Industries – Presentation 11:15 Knowledge Industry Action Plans 12:00 Lunch

  28. Knowledge Industries • Knowledge Industry definition • Businesses whose operations and success depends mainly on knowledge, innovation and technology. Examples include software, high-tech manufacturing, communications, R&D, and finance. • Knowledge workers are workers whose main asset is knowledge. They are paid to “think for a living”. Typical examples may include software engineers, architects, engineers, scientists and lawyers. • We will focus on a segment of knowledge industry: • Knowledge industry clusters that are growing in NC, and for whom the “5-9’s” reliability and bandwidth provided by BalsamWest are “mission-critical”

  29. Knowledge Industry Clusters Growing in NC and That Require “5-9s” Reliability • Existing clusters • Computer programming, systems design, & related services • Health sciences (incl. pharmaceuticals) and informatics • Surgical and medical instruments • Emerging clusters • Magnetic & optical media manufacturing & reproduction • Data processing, Internet hosting, & related services • Software publishing • Banking and finance • Internet publishing & broadcasting, ISPs & search portals, & other information services • Business, scientific, & technical consulting services • Rapid prototyping and specialized design services

  30. Business Attraction: Mountain West Alliance • Qualla Boundary and seven westernmost NC counties are each too small individually to have the resources and the sites necessary to compete effectively to attract knowledge businesses • Have formed Mountain West Alliance to work together to be able to identify and pursue potential knowledge industries • Regional approach has been successful for other rural NC communities in attracting knowledge industries • Example: “Data center corridor” in rural NC, including Alexander, Burke, Caldwell, Catawba and Iredell counties. • Data centers from Google, Apple, financial services, etc.

  31. Key Assets for Attracting Knowledge Industries • Infrastructure: “5 9’s” high bandwidth fiber, inexpensive redundant power, plentiful water • Workforce: skilled labor for knowledge industry applications • Build on WCU, community college training • Public sector: supportive, business friendly • Quality of life: natural resources, housing, schools

  32. Profile of Entrepreneur/Firm Owner • Interest in outdoor recreation • Mountain roots • Rural lifestyle preference • Family at Western Carolina University, or alumni • Retirement transitioning

  33. Attracting Knowledge Industries • Conduct market research to determine best potential areas/networks in which to recruit • Develop “market offering”: sites, information, incentives to share with potentially interested companies. • Locations available • Information on workforce, quality of life, industry clusters • Incentive packages and assistance • Develop and launch marketing campaign

  34. Knowledge Industry Action Plans • To be reviewed today • Marketing plan for attraction of Knowledge Industries • Feasibility study for fiber-enabled office building and co-working space • On hold • Tribally-owned data center • This is already being explored by EBCI Commerce. • Call center to service Harrah’s and other Caesar’s properties • This is being reviewed by a team at Harrah’s

  35. Marketing Plan for Attraction of Knowledge Industries • Goal: identify and attract small-midsize knowledge businesses to Boundary and 7 counties of Western NC • Activities: • Inventory and quantify the key assets of Mountain West Alliance region make it uniquely attractive to small, growing, entrepreneurial knowledge industry businesses • Conduct market research to develop clear profiles of target market segments/customers who would find the assets of Mountain West Alliance locations attractive. • Develop “market offering”: sites, information, incentives to share with potentially interested companies. • Develop and launch marketing campaign

  36. Marketing Plan for Attraction of Knowledge Industries • Organizational home: Southwest Commission • Potential Partners • EBCI Commerce, Economic Development Depts of 7 Western Counties, Duke Energy, Drake Software • Resources: TBD • Potential funding in cash and in kind • Drake Software? • Special assessment from 7 counties? • EBCI? Cherokee Preservation Foundation? • Timeline: 18 months

  37. Feasibility Study for Fiber-Enabled Office Building and Co-Working Space • Goal: determine whether sufficient demand exists at specific rental price points to support cost of fiber-enabled office building/co-work space (similar to Mojo in Asheville) • Activities: • Develop profile of potential users • Conduct individual interviews and online survey of tech and home-based entrepreneurs businesses within a 30-mile radius/located in Jackson or Swain County • Develop estimate of potential demand for office and co-working space and a suite of services at particular price points • Organizational leadership: Sequoyah Fund and Southwestern Commission • Potential Partners: Chamber of Commerce, EBCI Commerce Department, WCU Small Business Technical Development Center, Haywood Committee College Entrepreneurial Program and the TERO Office.

  38. Agenda - Afternoon 12:30 Review Potential Action Plans; Add New Ones - Enterprise Structure - Small Business - Tourism 2:30 Next Steps, Assignments 3:00 Adjourn

  39. Small Business Action Plans • Small Business and Entrepreneurship Action Plans for discussion today: • Expand sales of Cherokee art • Strengthen Chamber of Commerce • Create an economic coalition to support small business development and growth • Build a more vibrant entrepreneurial culture on the Boundary

  40. Success Factors for Small Business

  41. Action Plan: Expand Sales of Cherokee Art Goal – Expand sales by Cherokee artists, both traditional and contemporary art. Activities - • Create online sales using available social media tools • Develop a Cherokee authenticity label • Develop a distinctive Cherokee brand • Create a Cherokee artist council • Include both traditional and contemporary art • Broker Cherokee art off-Boundary • Provide entrepreneurial training • Qualify Cherokee artist as trainers • Support creation of artist portfolios • Provide micro-loans to artists • Support artists’ sales booths at various events

  42. Action Plan: Expand Sales of Cherokee Art Organizational leadership – Sequoyah Fund Participants • Sequoyah Fund – Russ Seagle, Hope Huskey • Qualla Arts & Crafts – Vicki Cruz Resources required – Estimates to be developed by Sequoyah Fund Funding sources – Primarily Sequoyah Fund Timeline – Steps being taken now

  43. Action Plan: Strengthen the Chamber of Commerce Goal – Strengthen Cherokee Chamber of Commerce financially and operationally Activities • Develop a business case for supporting the Chamber from levy and privilege taxes on Cherokee businesses • Work with EBCI Finance to develop potential formulas for obtaining funding from levy and privilege taxes • Seek sources of ongoing funding from levy and privilege taxes through EBCI Administration and Tribal Council • In parallel with the above, create a plan for expanding business assets in Cherokee • Develop and provide a complete array of small business services to Cherokee • Collaborate with surrounding Chambers and economic development agencies to seek small business growth

  44. Action Plan: Strengthen the Chamber of Commerce Organizational leadership – Cherokee Chamber of Commerce Participants • Cherokee Chamber of Commerce – Amy Parker • EBCI Finance – TBD • Surrounding Chambers and E.D. agencies Resources required - TBD Funding sources - TBD Timeline - TBD

  45. Action Plan: Create Economic Development Coalition Goal – Create an economic coalition to support small business attraction, development and growth Activities • Develop a coordinated strategy to create new jobs in all sectors of existing businesses through expansion and growth • Create and implement a coordinated plan to attract businesses to locate in Cherokee and the surrounding three counties • Develop a strategy that encourages entrepreneurial efforts to start businesses in targeted fields • Coordinate and integrate the efforts of economic development on the Boundary with neighboring interests, including economic development agencies and Chambers in Swain, Jackson and Haywood Counties

  46. Action Plan: Create Economic Development Coalition Organizational leadership • Cherokee Chamber of Commerce – Amy Parker • EBCI Commerce – Jason Lambert • Sequoyah Fund – Russ Seagle • Destination Marketing – Skooter McCoy • Swain, Jackson and Haywood Counties • Smoky Mountain Host • WCU – Steve Morse • CPF – Mary Jane Ferguson Resources required – TBD Funding sources – TBD Timeline - TBD

  47. Action Plan: Build a More Vibrant Entrepreneurial Culture Goal – Build a more vibrant entrepreneurial culture on the Boundary. Entrepreneurial Small Business needs: • Markets • Location to lease or build • Access to Capital • Employees • Small Business Training/Development Resources • Business Services – Insurance, Accounting, Marketing, etc. • Clear, Concise Information about the Selected Environment • Supply and Distribution Chain Information • Connectivity • Inspiration

  48. Action Plan: Build a More Vibrant Entrepreneurial Culture Activities • Establish a baseline description of a desirable/optimal small business environment • Complete research necessary to map the small business environment in Cherokee • Identify gaps/constraints between Cherokee environment and baseline • Prioritize the challenges and attack the problem • Create incentives to come to Cherokee • Develop the resources and avenues to connect with potential small businesses locally, regionally and beyond • Offer Indianpreneurship training • Start, gain momentum, and sustain the effort

  49. Action Plan: Build a More Vibrant Entrepreneurial Culture Organizational leadership • Sequoyah Fund – Russ Seagle • EBCI Commerce – Jason Lambert • TCGE – Ray Rose • EBCI Destination Marketing – Skooter McCoy • Cherokee Chamber of Commerce – Amy Parker Resources required - TBD Funding sources -TBD Timeline - TBD

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