As the Legislature goes into its final days, the budget takes center stage. Seven bills that make up the state’s biannual budget were heard in the last [we think] House Appropriations Committee hearing, along with the reinstated Proposition 204 bill, HB 2630. This bill will enact the initiative approved by voters last November that appropriates tobacco settlement dollars to increase enrollment in AHCCCS, Arizona’s health insurance program for the poor.
The Senate will have at least one more appropriations meeting next Wednesday, April 18; the Hopi radio appropriation bill, HB 2567, has at least one more chance of passing the committee, as it was held this week. The strike-all amendment to HB 2431 to revive funding for Navajo senior centers was not considered either in Senate Appropriations, but it’s also on Wednesday’s agenda.
Holding committee hearings past the legislature’s self-appointed deadlines may seem to be against their rules; however, the Legislature is permitted to make, and break, its own rules as necessary to conduct business during its session. This flexibility allows lawmakers to squeeze in important bills, such as the Prop. 204 bill, as well as give each bill a fair chance to be heard.
In other legislative news: The state has a budget—at least for now. The Legislature worked overtime to get the budget through both houses and approved on Thursday evening. However, Gov. Hull is threatening to veto the whole package and send it back for reconsideration in two weeks, when new revenue projections are completed by the Joint Legislative Budget Committee.
And the Arizona Commission of Indian Affairs will be around for another ten years. Last Monday, Gov. Hull signed the bill to continue the agency until July 1, 2011. All state agencies must undergo a review each ten years, known as a ‘sunset review,’ to determine if its continued existence is justified. Just this week, the state program to provide college scholarships to underprivileged students, ASPIRE, was terminated. ACIA looks forward to serving the needs of tribal governments and communities for another ten years, and thanks tribal members and governments who wrote letters and spoke on its behalf at committee meetings.
HUD, IRS speakers give vital information at ACIA board meeting
At ACIA’s quarterly board meeting, held on April 12 at Scottsdale Community College, representatives from the Internal Revenue Service and the Department of Housing and Urban Development spoke on programs that benefit and impact tribal communities and members.
Theresa Nosie, Navajo, recently appointed as one of IRS’s Indian Tribal Government Specialist in response to an executive order issued in 1998, explains Federal taxation and Indian tribes. This executive order strengthened tribal sovereignty by “recognizing that the federal government will consult with tribes as separate government entities,” says Nosie.
Nosie also explains the regulations governing taxable and non-taxable status. A tribal government, or tribally-owned corporation operating on a reservation, is non-taxable for Federal tax purposes. The tribe must pay unemployment taxes and Social Security/Medicare taxes for its employees, and employees of tribal governments, corporations and private businesses must also pay Federal income tax.
A corporation owned by a tribal member must pay Federal income tax, except for businesses whose income is derived from land usage; Nosie notes that cattle ranches and land leases, for example, are non-taxable. Nosie also says that many accountants who don’t deal with tribes on a regular basis don’t know about these rules.
The IRS conducts small business workshops explaining these and many other issues associated with tribal business and government and Federal taxation at no charge. Call Nosie at (602) 207-8734 for information on how to set up a free workshop for your community.
Nosie says that the IRS also trains volunteers to prepare tax returns for free, and provides computers and Internet service on pre-determined days to file electronic returns at no charge. She says that these programs can help tribal community members save lots of money on tax preparation and electronic filing.
Paul Jurkowski, director of the Office of Loan Guarantee at HUD’s Office of Native American Programs, wants to “break down barriers to granting home mortgages” on tribal lands. Jurkowski is promoting HUD’s Section 184 Indian Housing Loan Guarantee Program, which helps tribal members obtain mortgages to build, purchase or renovate housing.
Jurkowski explains how the 184 loans work. First, the tribe must enact procedures that deal with foreclosure, eviction, lien and leasing procedures. Without these ordinances, Jurkowski says, neither a lender nor HUD can go further. Next, the tribe provides trust land for housing projects and serves as the lessor for the land.
Infrastructure, such as roads and utilities, must be in place or in process of being built, and tribal members should receive counseling on becoming “financially literate.” This may include basic money management, education on how to avoid becoming entrapped in high-interest consumer loans like predatory car loans or department store credit cards, or credit counseling.
This counseling will help them become not only better risks for mortgages, but benefits them by avoiding exorbitant interest rates. Jurkowski notes that some tribal members are soaked by up to 30 percent interest rates and payments of $600 per month on auto loans
HUD will issue a loan guarantee to participating lenders, and the lender, like a bank, credit union or mortgage broker, issues the loan. Jurkowski believes it’s better for local banks and institutions to grant home mortgages, as they know their customers best.
Jurkowski says that the program has helped over 400 families get into homes in the three and one-half years since its inception, and that its predecessor only granted 200 loans in twenty years.
More information on this and other HUD programs can get obtained by calling (303) 675-1600 or go to their Web site at www.codetalk.fed.us/loan184.