I just spoke with Navajo Council Delegate LoRenzo Bates about $4.1 million for Navajo Transitional Energy Company. Bates said that B&F is having a special meeting on 10-10-13 to address $4.1 million for NTEC.
The B&F was not scheduled to meet this week.
Bates said that the B&F would meet before the Naa’biki’yati’ Committee. And so if the B&F takes action on the $4.1 million, it could be added to the Naabi’s 10-10-13 agenda. And if Naabi takes action on it, then it goes to Council for final action and then to President Shelly, who said that he wuold sign off on the $4.1 million if the Council approves the Energy Policy.
According to some of the Council delegates, the $4.1 milion legislation opens the door for NTEC to borrow up to $36 million by using the Permanent Trust Fund 12 percent set aside.
The set aside is what percent of the tribal revenues is deposited into the Permanent Trust Fund. Right now 12 percent of ALL of the tribal revenues is deposited into the PTF and that’s Navajo law.
But Bates and the Navajo Nation Investment Committee found a way to use the interest of all the Navajo Trust Fund, which are specifically for Veterans, Scholarships, Senior Citizens, the Handicapped, Public Safety/Courts, to make a $200 million loan to the Gaming/Gambling Enterprise to construct casinos. Bates has said that when the Investment Committee approved the loan to the Gambling Enterprise, that the IC also set a loan interest and that the loan interest and repayment amount is making more money for the Trust Funds that were used.
Under this new plan for the $4.1 million for NTEC. The $4.1 million would come from the Reserves Fund, which the Council is mandated to keep at a balance of 10 percent of the annual budget. The Reserves balance is more than $7.7 million. The 2014 budget is $587 million. Bates said that the $4.1 million is a loan from the Reserves which concerned some RDC members who asked if the Reserves had ever been used as a loan before.
The $4.1 million legislation also allows NTEC to apply for a $36 million loan using the Permanent Trust Fund 12 percent setaside to buy the BHP coal mine. BHP wants $85 million for its coal mine. NOTE: The coal at BHP belongs to the tribe and so the tribe is not paying for the coal.
In the 2014 tribal budget, about $28.2 million, which is 12 percent of the 2013 tribal revenues, was deposited into the PTF. Navajo law mandates that the setaside be made before any of the tribal revenues are used.
Bates also told the Resources & Development Committee today that the Budget & Finance Committee would identify what portion of the PTF 12 percent setaside would be used for the NTEC loan of $36 million. Bates also noted that the B&F could recommend that the entire 12 percent be used or just a portion.
The proposed $220 million Bond Financing Package, which would fund a variety of community projects, was also eyeing the PTF setaside. And under the PTF law, the PTF interest is to be used for community projects.
The PTF interest is about $32 million.
