Per capita loan program approved in Cherokee
Twice each year, every Cherokee tribal member gets a payout of thousands of dollars — called a per capita payment — based on profits at the two tribally owned casinos.
Now, following passage of a resolution introduced by Principal Chief Patrick Lambert, tribal members will have access to cash between regular payouts by borrowing against their upcoming per capita payment for a zero-interest loan, up to $500 each month.
“If there’s a young family, a mother and a father in a home, and they borrow against their own per-cap payment, that’s an extra thousand dollars coming into that household,” Lambert told Tribal Council on Oct. 31. “That can be life-changing.”
Rather than paying exorbitant interest fees to the loan sharks known to prey on Cherokee families facing financial emergencies, Lambert said, the legislation would allow them to access their own money for zero percent interest with an application fee of $35 for each six-month period. Because casino profits are doled out to the tribe monthly but paid to its members bi-yearly, the loan program would not present a cash flow problem to tribal finances. And, because loans are not considered income, obtaining cash this way would not interfere with tribal members’ Social Security benefits. Social Security payments are determined monthly, based on how much income an individual has received during that period.
“Our goal is to create self-sustaining families, so this would be just another opportunity to help do that,” Vickie Bradley, secretary of the EBCI Public Health and Human Services, told Council.
Poverty is high on the Qualla Boundary, Bradley said, with a 2013 tribal health assessment showing that 23 percent of people living there sometimes went without food. While services do exist for those in need, none of those services take the form of monthly payments. The loan program, Bradley said, would allow for a more consistent income stream.
Debating drug tests
Lambert built a careful case for the loan program’s passage, but his resolution nevertheless faced stiff opposition from some councilmembers.
When Lambert’s plan was announced, said Councilmember Anita Lossiah, of Yellowhill, “immediately there was an outcry from the community, from families with addiction.” Drug abuse is a high-profile problem on the Qualla Boundary, and families were concerned, Lossiah said, that the monthly loans would serve to bankroll drug overdoses. Lossiah expressed support for the concept behind the proposed program but said that it should be crafted to prevent loan money from going to drug users. In addition, she said, the loan application process could be a “window of opportunity” to give financial advice to people who likely already struggle with managing their money.
She offered an amendment to the resolution that would require loan applicants to obtain a negative drug test and personal finance advisement before accessing the money. Councilmember Alan “B” Ensley, of Yellowhill, seconded the move, and it passed following a split vote.
Backlash against the vote was swift, eliciting strong reaction from many in the room. Lambert spoke first, suggesting that if Council were to place a drug test requirement on loan applicants, it might as well require one for anybody to receive a per capita check at all. After all, Lambert said, the loans are nothing more than per capita money already due to the tribal member in question — just paid out at a different time than normal.
“To put stuff like this on someone to receive their per cap, that’s beyond the pale to me. I can’t understand that,” Lambert said.
Perhaps, Lambert implied, some councilmembers were hesitant to pass the resolution because they are among the loan sharks who enrich themselves off of others’ need. Loan sharking is a problem on the Qualla Boundary, those present seemed to agree, with cash advances sometimes requiring interest as high as 100 percent.
“I don’t understand the reluctance to this,” Lambert said. “This is simply to help individuals get on their feet. Is it perhaps because there’s a sense that some opportunity to have someone come and ask you for a loan — (there) is some loss of power or authority?”
Tribal member Sheila Standingdeer took the mic after Lambert, telling council of her struggles, as a college-educated tribal member, to find adequate employment on the boundary. For people in her situation, she said, the loans could do a lot of good. And while drugs are indeed an issue, it doesn’t take $500 to overdose.
“Like you said, there are people gonna do drugs, but people are gonna do what people are gonna do,” Standingdeer said. “It don’t matter if they have $5,000, $500 or $5. You ought to stop and think about it.”
“Not everybody has $80,000,” she added, throwing a verbal dart at councilmembers who in 2014 voted to raise their salaries of about $70,000 to about $80,000. The pay raise elicited anger in the community that’s still alive two years later and resulted in a lawsuit that the Cherokee Tribal Court ultimately dismissed.
The drug-test amendment was “the dumbest move that I’ve heard since I’ve been here this year,” Councilmember Teresa McCoy, of Big Cove, said.
“Get off your high horse,” she told her fellow councilmembers. “You make $80,000 a year. You don’t want people bumming from you, then give them an opportunity to help themselves.”
McCoy then moved to rescind Lossiah’s amendment from the resolution, with enough councilmembers changing their minds to vote the amendment away.
“We are talking about grandparents,” added Brenda Norville, a tribal member who lives in Snowbird. “To have them come in and do a drug test before they get access to their $500, that was really bad, Anita (Lossiah). You should never have done that.”
“If you explained it to them and said we’re trying to fight the drug epidemic, they would understand why we’re doing it,” Ensley replied. “The drug epidemic is why they’re having to raise their grandkids.”
“You’re going to have people coming in paying light bills,” Norville said. “You’re going to have people that has car bills that comes in. Just emergencies — you’re going to have probably 90 percent of the people that comes in for that $500 that’s going to use it wisely.”
Loan terms and loan sharks
When Lossiah spoke up again, it was to reiterate that she supports the idea of offering emergency loans but feels some sort of requirement should be placed upon those accessing them.
“This is totally from an outcry in our community to try to implement a few more guidelines on this,” Lossiah said. “And this is a loan. This is something that does have to be paid back. Usually a loan pays with interest. It is good to make sure that people put some thought and some planning into their finances.”
But, Lambert said, people are already getting loans — just not on fair terms. A side effect of his legislation, he said, would be to put a pinch on those getting rich off of others’ hard times.
“Last per cap we had 120 checks that went to one person — $600,000 went to one person last per cap. One address got 120 checks,” he said. “Now if that’s not in itself enough reason to do this, I think the consideration of what everybody’s having to face and needing a little money to tide them over should be.”
Council ultimately approved the legislation. But Lossiah maintained her stance that the executive office should take great care to develop guidelines preventing the service from being abused.
“This is something that cannot be used as an enabler, so let’s make sure the guidelines are developed properly and really well on these processes,” she said.
“You have my assurance on that,” Lambert replied.
The loans proved popular as soon as they were approved, with long lines of tribal members forming to put in their applications the very week the resolution passed. After two days — Nov. 3 and 4 — 1,557 applications had been received, representing about 10 percent of the tribal members. By the end of Monday, Nov. 7, more than 2,000 people had applied. Those who have applied thus far will receive their checks Thursday, Nov. 10.
After that initial loan payout, tribal government will take a look at the process and tweak it to allow the program to run smoothly on an ongoing basis.
“Since this was the first run of this type, we are making some minor changes to the process that will set dates, create an ability to perform a recurring loan monthly and allow for individuals who live away from the Qualla Boundary to participate without having to travel here. This could benefit college students,” explained Chris McCoy, communications director for the tribe.
A specialist will likely be hired to handle the loan program in the future, though it is currently being handled by Susie Wolfe, the tribe’s accounting and revenue manager.
“I have always believed your money should be in your hands quicker than two times a year and have fought for and discussed this type of system to be put in place for years,” Lambert wrote on his Facebook page. “Right after I submitted the legislation I went to work to get agreement from the Social Security Administration, Tribal Council and others to make it happen. And it worked.”
Tribal members to receive highest per capita ever
While tribal members won’t get their per capita checks until December, an announcement last week revealed that this cycle’s payment will be the highest ever since the first per capita payment was issued nearly 20 years ago.
Every enrolled member will receive $6,189, with the amount going down to $6,088 after the mandatory tax and $5,261 after the voluntary tax.
“This is the largest check I think we ever got, so thank you all the people that came to gamble, thank you, and to the staff at Harrah’s,” said Councilmember Tommye Saunooke, of Painttown, during the Nov. 3 council session.
Per capita money is derived from casino profits, and the tribe now has one more casino than it did a year ago. Harrah’s Cherokee Valley River Casino and Hotel opened in September of 2015, and now its profits join those of Harrah’s Cherokee Casino Resort in contributing to per capita payments — half of the casino profits go to tribal government and the other half is divvied up into per capita payments.