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Federal court blocks funding to corporations vying for tribal stimulus

Federal court blocks funding to corporations vying for tribal stimulus
© Greg Nash

A federal court has blocked the Trump administration from giving stimulus funds to corporations owned by Alaska Natives, largely siding with tribes who argue the funds were intended for governments assisting with the pandemic.

U.S. District Court Judge Amit Mehta said giving “dollars to for-profit corporations does not jibe” with the law’s “general purpose of funding the emergency needs of ‘governments.’”

Congress set aside $8 billion in funds in a $2.2 trillion coronavirus stimulus package for tribal governments, but a form to apply for the assistance asked applicants to list either their total tribal population or their number of shareholders, a nod to the numerous corporations owned by Alaska Natives.

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The so-called Alaska Native Corporations have vast land holdings and secure significant profits from timber and oil sales, which are funneled back to tribal members.

It is not uncommon for tribes to own businesses like casinos outright, which provide funding for tribal governments. But while Alaska Native Corporations have tribal members as shareholders, those funds do not typically go into tribal coffers.

Sen. Tom UdallThomas (Tom) Stewart UdallFive House Democrats who could join Biden Cabinet Overnight Energy: Biden names John Kerry as 'climate czar' | GM reverses on Trump, exits suit challenging California's tougher emissions standards | United Nations agency says greenhouse gas emissions accumulating despite lockdown decline GSA transition delay 'poses serious risk' to Native Americans, Udall says MORE (D-N.M.), vice chairman of the Senate Indian Affairs Committee, said Congress intended for the funds to flow only to government entities “so that they can continue essential government services.”

“Non-governmental tribal entities may well warrant relief under other CARES Act programs, but this funding in this title was intended for Tribal governments and should not be diverted,” Udall wrote to Treasury Secretary Steven MnuchinSteven Terner MnuchinThe Hill's Morning Report - Presented by the UAE Embassy in Washington, DC - Trump OKs transition; Biden taps Treasury, State experience On The Money: Democrats accuse Mnuchin of sabotaging economy in dispute with Fed | Trump administration proposal takes aim at bank pledges to avoid fossil fuel financing | JPMorgan: Economy will shrink in first quarter due to COVID-19 spike Democrats accuse Mnuchin of sabotaging economy in dispute with Fed MORE and Interior Secretary David Bernhardt earlier this month, using the initialism for the stimulus legislation.

The Treasury Department, which oversees the funds, did not respond to a request for comment, and the Department of Justice did not immediately respond to questions about whether the administration would appeal the ruling.

The potential for Alaska Native Corporations to receive stimulus funding not only spurred legal action, but resulted in calls for the resignation of Tara Sweeney, the Interior Department’s assistant secretary for Indian affairs.

Sweeney is an Alaska native and former vice president with the Arctic Slope Regional Corporation, one of the corporations that would have been eligible for stimulus funding.