Qualla 2020:
Diversifying the Qualla Economy
Fourth Meeting
May 21, 2014
Page 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
Page 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
Page 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.
Page 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 
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
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
Page 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:

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Goal
Participants
Activities
Organizational leadership
Resources required
Funding sources
Timeline
Page 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
Page 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:



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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
Page 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
Page 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.
Page 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
Page 12
HEARTH Act


To opt-in, tribes must adopt their own leasing regulations
Tribal regulations must be approved by the Secretary of
the Interior


Law is limited to tribally-owned trust lands

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Secretary has 120 days to review tribal regulations
Doesn’t apply to individually-owned lands
Law is limited to surface leasing

No oil & gas leasing
Details adapted from Bryan Newland, Fletcher PLLC
Page 13
HEARTH Act Requirements

Tribal regulations must:
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Be “consistent” with BIA’s leasing regulations
Establish an environmental review process
Environmental review process requirements
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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
Page 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)
7. Ewiiaapaayp Band of
Kumeyaay Indians (CA)
8. Kaw Nation (OK)
9. Dry Creek Rancheria
(CA)
10. Jamestown S’Klallam
(WA)
5. Santa Rosa Band of
Cahuilla Indians (CA)
11. Mohegan Tribe (CT)
6. Citizen Potawatomi
Band (OK)
12. Wichita and Affiliated
Tribes (OK)
Details adapted from Bryan Newland, Fletcher PLLC
Page 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
Page 16
Self-Determination Contracts (Realty)
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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
Page 17
Self-Governance Compacts (Realty)
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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

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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
Lummi Tribe: Example of Realty Compact
Page 18
Page 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.
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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 selfgovernance compact
Page 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
Page 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
Page 22
Real Estate Action Plans

Two action plans under development for review today


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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
Page 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:
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Operations:
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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?
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?
Page 24
Create Implementation Plan for Compacting BIA
Realty Function

Activities:
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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
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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
Page 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

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Travel cost for GIS office staff site visits to two other Tribes
and National Tribal GIS conference
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$20,000
Supplies

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$14,000
GIS database schema modification cost and custom workflow
programming

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$15,000
$1,000
Total cost of implementation plan development: $50,000
Funding sources - TBD
Timeline – 18 months
Page 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:
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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
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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
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Funding sources – TBD
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Timeline – 18 months
Page 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
Page 28
Knowledge Industries

Knowledge Industry definition
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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”
Page 29
Knowledge Industry Clusters Growing in NC and
That Require “5-9s” Reliability
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Existing clusters
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Computer programming, systems design, & related services
Health sciences (incl. pharmaceuticals) and informatics
Surgical and medical instruments
Emerging clusters
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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
Page 30
Business Attraction: Mountain West Alliance
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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.
Page 31
Page 32
Key Assets for Attracting Knowledge Industries
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Infrastructure: “5 9’s” high bandwidth fiber, inexpensive
redundant power, plentiful water
Workforce: skilled labor for knowledge industry
applications
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Build on WCU, community college training
Public sector: supportive, business friendly
Quality of life: natural resources, housing, schools
Page 33
Profile of Entrepreneur/Firm Owner
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Interest in outdoor recreation
Mountain roots
Rural lifestyle preference
Family at Western Carolina University, or alumni
Retirement transitioning
Page 34
Attracting Knowledge Industries

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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.

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Locations available
Information on workforce, quality of life, industry clusters
Incentive packages and assistance
Develop and launch marketing campaign
Page 35
Knowledge Industry Action Plans

To be reviewed today

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Marketing plan for attraction of Knowledge Industries
Feasibility study for fiber-enabled office building and coworking space
On hold

Tribally-owned data center
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
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
Page 36
Marketing Plan for Attraction of Knowledge
Industries

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Goal: identify and attract small-midsize knowledge
businesses to Boundary and 7 counties of Western NC
Activities:


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
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
Page 37
Marketing Plan for Attraction of Knowledge
Industries
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Organizational home: Southwest Commission
Potential Partners

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
Resources: TBD
Potential funding in cash and in kind


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EBCI Commerce, Economic Development Depts of 7 Western
Counties, Duke Energy, Drake Software
Drake Software?
Special assessment from 7 counties?
EBCI? Cherokee Preservation Foundation?
Timeline: 18 months
Page 38
Feasibility Study for Fiber-Enabled Office Building
and Co-Working Space

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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:


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
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.
Page 39
Agenda - Afternoon
12:30
2:30
Review Potential Action Plans; Add New Ones
- Enterprise Structure
- Small Business
- Tourism
Next Steps, Assignments
3:00
Adjourn
Page 40
Small Business Action Plans

Small Business and Entrepreneurship Action Plans for
discussion today:
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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
Page 41
Success Factors for Small Business
Market
Demand
Entrep.
Culture
Trained
Workforce
Suppliers &
Resources
Capital
Transport &
Comm.
Public
Sector
Support
Page 42
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
Page 43
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
Page 44
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
Page 45
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
Page 46
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
Page 47
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
Page 48
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
Page 49
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
Page 50
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
Page 51
Tourism Action Plan
Goal – Develop options for increasing tourism, utilizing cultural and natural
assets
Organizational Leadership - Skooter McCoy, Destination Marketing
Activities 
New programs for Unto These Hills being discussed with CHA Board

Relocate Oconaluftee village near the Museum

Add fly fishing museum along with trout exhibit/aquarium

Create a downtown Base Camp of the Smokies with appropriate retail

Relocate Fairgrounds to old high school site

Add convention center to high school site

Develop wildlife attraction at the Oconaluftee Village site

Improve attractiveness of Saunooke Village

Add visitor amenities to the gaming destination

Create all new visitor way-finding signage

Develop a fishing pond for children

Prepare a community gathering place
Page 52
Tourism Action Plan
Next Steps

Bring the concept to the CHA and Museum Boards, and get their
acceptance and approval…discussions under way

Communicate the district concept to EBCI Administration, Planning Board,
Tribal Council, business owners, and community leaders

Convene a coalition of organizations within each district to provide input
during the transition

Develop a master plan with renderings with cost estimates for the creation
of the districts

Conduct feasibility studies for the major element of the program

Start archeological and Phase I environmental studies
Organizational leadership – EBCI Destination Marketing
Resources required - TBD
Funding sources - TBD
Timeline - TBD
Page 53
Next Steps

Fourth meeting of task teams by phone

Continue work on options






Research
Interviews
Financial analysis
Exploration of funding sources
Development of recommendations
BWB Solutions and Medicine Root will staff and facilitate
tasks teams and conduct additional research as necessary
Page 54
Contact Information
Ben Sherman
sherman1491@gmail.com
(303) 818-4926
John Weiser
johnw@bwbsolutions.com
(203) 314-8600
Page 55
Appendix
Page 56
State Taxation of Property on the Boundary

North Carolina property tax is levied both on real estate and
on business property (computers, office equipment, etc.).

The tax is levied by and paid to the counties. Each county sets its
own property tax rate.



Jackson $.28 per $100 of valuation; Swain $.36 per $100
NC regards a long-term lease as being real property, and
therefore subject to property tax
NC position on taxation



Property owned, developed and held by the Tribe is not subject to
property tax (example: Harrah’s)
Property owned, developed and held by Tribal members is not
subject to property tax.
If 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, whether or not the
property is on the Boundary.
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Example: Food Lion Shopping Center – the leasee is paying property
tax to Jackson County
Business property held by a non-member is subject to property
tax, whether or not the business property is on the Boundary.
Page 57
New BIA Leasing Regulations: A Contrary Position
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New BIA leasing regulations (25 CFR Part 162) provide a
position contrary to NC’s position
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162.017. “The purposes of residential, business, and wind/ solar
resource leasing on Indian land are to promote Indian housing
and to allow Indian landowners to use their land profitably for
economic development, ultimately contributing to tribal well-being
and self-government.”
162.017(a). “Subject only to applicable Federal law, permanent
improvements on trust or restricted land are not taxable by
States or localities, regardless of who owns the improvements.”
162.017(b). “Subject only to applicable Federal law, activities
conducted under a lease of trust or restricted land that occur on
the leased premises are not taxable by States or localities,
regardless of who conducts the activities.”
These new regulations open the door to changing the current
property tax situation on the Boundary.