Professor Clarkson was quoted in an article on the Fronteras website, commenting on the Navajo
Nation’s solid credit rating recently given by Standard & Poor’s and the impact this will have on issuing
bonds to raise funds for local infrastructure projects.
The online article includes a link to an audio clip of an NPR interview given by Professor Clarkson on
Wednesday.
http://www.fronterasdesk.org/news/2011/nov/02/economy-debt-native-americandevelopment-borrow/
The following article was posted on the Fronteras’ website on Thursday, November 3,
2011:
Navajo Nation Issues First Bonds
http://www.fronterasdesk.org/news/2011/nov/02/economy-debt-native-american-developmentborrow/
FLAGSTAFF — The Navajo Nation plans to issue its first bonds to raise funds for local
infrastructure projects. Unlike their state and municipal government counterparts, tribes typically
face more challenges borrowing money.
This move may pave the way for other tribes looking for economic stimulus.
The $120 million sale would be the biggest by a tribal government that isn’t backed by gaming
revenue. Instead, the Navajo Nation would use revenue from oil, gas and coal royalties to build
shopping centers, restaurants, office parks and industrial complexes. The Navajo Nation has
more than $1 billion in reserves.
Standard and Poor’s gave the tribe an investment grade A rating, one level above California’s
bonds.
"The tribe has been able to get a fairly solid credit rating, so it should be attractive to investors,"
said Gavin Clarkson, an expert in tribal finance who teaches at the University of Houston Law
Center. "And at the end of the day, it should make a major difference to the lives of tribal
members."
The bond sale is intended to create jobs and stimulate the economy. Almost 40 percent of the
reservation’s residents lived below the federal poverty level in 2009.