Pivoting from centralized planning: Naabi approves dividing ARPA’s $1B equally by delegate region

WINDOW ROCK

After a grueling two-day work session last week, the Naabik’iyati’ Committee approved a plan to appropriate the remaining $1.07 billion in American Rescue Plan Act funds, which amends the president’s infrastructure bill (No. 257-21), tabled in January.

Per the amendment, passed by a 14-9 vote, $910.6 million will be divided equally between delegates, yielding $41.4 million per delegate region, with $159.7 million going to COVID-19 recovery programs and services.

“Delegate region” is defined as all Navajo Nation chapters, both LGA certified and non-LGA, and townships, represented by a delegate.

“We’re pivoting from a centralized, Window Rock approach to how we can have these discussions for our region with our chapters and our people,” Delegate Amber Kanazbah Crotty told the Navajo Times.

“It can no longer be Window Rock dictating to the people what’s best for them,” she said. “We need more empowerment at the community level.”

Of the $2.079 billion in ARPA funding the Nation received last year, $1.008 billion was already appropriated for Hardship Assistance ($557 million), Sihasin Fund and Unreserved, Undesignated Fund Balance project reimbursements ($76.6 million), refunded CARES Act projects ($167.6 million), and Navajo Nation government administrative/regulatory support ($207.9 million).

‘More transparency’

In the Naabi work session, Crotty proposed an amendment (to No. 257-21) to divide the remaining ARPA funds equally by the 24 delegate districts to ensure fairness and community involvement in decision-making.

“We have to be able to explain these projects,” she said. “Not only do they need to be eligible, but there also needs to be more transparency and we have to have a sense of equity.”

What that means, she said. is that COVID-19 impacted all of the Nation so all of the Nation should benefit from the ARPA funding.

With Crotty’s agreement, Delegate Carl Slater proposed modifying her amendment to subtract out each delegate’s CARES Act, UUFB and Sihasin allocations approved last summer (in No. CJY-41-21) from their $41.4 million allocation to achieve parity, which was approved.

The new funding plan would also allocate $27.1 million to the judicial branch due to a backlog of cases, $55 million for the Department of Public Safety and Rural Addressing/E911, $8 million for cybersecurity, $5 million to the Dineh Chamber of Commerce to assist Navajo small businesses, and $64.5 million to the Navajo Department Health for ongoing COVID-19 response.

“This amendment is giving power back to the people,” said Delegate Eugenia Charles-Newton. “It’s asking, ‘What do you need and how can we spend this money to address the needs out there after COVID-19?’”

‘District led’

After months of debate by leadership over the fate of President Jonathan Nez’s bill (No. 257-21), the sponsor, Speaker Seth Damon, told the Navajo Times on Wednesday the passage of the amendment will finally begin the process of allocating chapter-level projects for each Council delegate.

“… we are near the final steps of now utilizing ARPA funding to begin the construction of broadband internet connections, new water and electric lines, and chapter infrastructure projects for the Navajo people,” he said.

Per the amendment, it will now be up to delegates to work with chapters and residents to decide which of the $222 million in water-wastewater, $90 million in broadband, and $97 million in electric projects in their region, as proposed in Nez’s bill, they want to keep.

After that is done, they will have to decide how to allocate any remaining unencumbered funds.

“They will use the pre-cleared lists and they’ll work with their communities,” said Slater. “There are strong arguments to be made for some of the recommendations for the NTUA projects, because they will increase the capacity for our utility systems that will reduce the cost and the burden for other types of development to take place.”

Delegate regions will also have the flexibility to propose new ARPA eligible projects or request review of chapter projects that were submitted prior to the Division of Community Development.

“I voted green for it, because if we do away with some of the NTUA projects, I think there’s going to be money left over to help the community, but it’s going to be a community decision on what projects are going to be decided,” said Charles-Newton.

Delegate regions can also engage with other broadband providers, cell providers and even housing providers for their communities, said Slater.

“We have the opportunity here to make investments to increase the capacity of the Nation to grow at the regional level, and at the hogan and local level,” Slater said in the Naabik’iyati’ session. “It will be community, district-led.”

Can’t be ‘a spending free-for-all’

Per the proposed amendment, delegates would have 90 days to put together their “delegate region projects expenditure plan” with the help of the ARPA FRF office and Division of Community Development staff.

“In general, every single delegate is going to be better off with this compromise than what is proposed in (Nez’s bill),” said Slater. “It empowers delegates, chapters and our people to prioritize needs from a grassroots perspective and not have Window Rock enforce its will upon the rest of the Nation.”

The amended bill moves next to Council and, if approved by at least 16 votes, will go to the president’s desk for his signature or veto.

This could be a challenge, however, because nine delegates — Herman Daniels, Mark Freeland, Pernell Halona, Raymond Smith, Wilson Stewart, Edmund Yazzie, Jimmy Yellowhair and Paul Begay voted red on the amendment in the Naabik’iyati work session.

Nez told the Navajo Times on Tuesday that the new amendment approved last Friday is “ill-guided” and takes the funding process out of the hands of the technical experts who carefully vetted the proposed projects, placing it in the hands of Council delegates to use at their discretion.

He also cautioned leaders about the federal spending guidelines issued by the U.S. Department of the Treasury and the deadline that requires the ARPA funds to be encumbered by Dec. 31, 2024, and fully expended (projects completed) by Dec. 31, 2026.

“These are federal dollars that come with strict guidelines that must be followed – this cannot be a spending free for all,” said Nez. “We cannot afford to defend against potential accusations of misuse of federal funds, and this amendment puts our Nation at risk of that.”

If the amendment is approved by the Council, Nez suggested there will be “thousands of projects” brought forth that do not meet the preliminary requirements and are not construction-ready.

“The Department of Justice has reviewed hundreds of proposed expenditure plans and this amendment will require them to review thousands more, thus substantially increasing the time before execution and possibly sacrificing this entire 2022 construction season,” said Nez.

If the amendment is passed, he warned, the Navajo Nation may end up reverting funds back to the federal government.

Nez added that nearly a year has passed since the Navajo Nation received the ARPA funds and the executive branch has been waiting for the Council to approve the original legislation it proposed.

“We need the Council to think seriously of the consequences of the amendment and reconsider,” he said.

‘Political unreality’

However, Slater said Navajo leadership needs to work cooperatively and listen to the people.

“The people have the authority and the power and leadership is supposed to mobilize the government to serve them,” said Slater.

Crotty said many eligible critical projects were not included in the original 500-page legislation and during multiple leadership meetings in the past nine months, its preparers never got down to the “nuts and bolts” of the bill, causing confusion and delays.

“Finally, now, we see what projects made the list,” she said.

“We understand that (the unamended No. 257-21) bill is the preference of the president, but it is a political unreality at this point,” said Slater.

“It was presented to us as this is the only feasible option when it’s just nakedly clear that there are other ways to get some more local projects or innovative ideas like alternative housing,” he said.

Crotty and Charles-Newton said that to date the executive branch also made no effort to consult with them and other delegates on prioritizing infrastructure projects for their regions.

“There’s water projects that are ARPA eligible that were not included,” said Crotty. “And what we’re finding is there are only a handful of homes that will be electrified.

“We have veterans, high-risk elders, and people with special needs who need electricity and we need those projects there,” she said.

Crotty said the Navajo Nation government was also allocated $207 million in ARPA funds for administration of projects through the FRF office, but local governments are not getting the help they need.

“Their job is to help educate the public,” she said. “Executive branch leadership is going to have to provide that to make sure the communities get the technical assistance they need.”

While she’s not envisioning a “slew” of new projects, Crotty said she hopes that existing projects that chapters submitted to DCD with supporting resolutions will be reviewed by DOJ and considered.

Many chapters were told they had their projects on Nez’s list, she said, but some of those are in fact missing from the executive branch infrastructure proposal.

If the amended bill is approved by Council and a delegate region expenditure plan is not submitted within the 90-day deadline, then the allocation of $41.4 million for the delegate region will be split among chapters based on the 50/50 distribution formula – 50 percent based on voter registration and 50 on equal distribution.

This does not mean that the chapters would be given the money outright, clarified Crotty.

The chapters would then need to determine their own expenditure plan, which would have to be approved by DOJ.

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