Recent charges return focus on Navajo Nation Council's discretionary funding

Noel Lyn Smith
The Daily Times

FARMINGTON — Bribery and conspiracy charges filed last week against current and former members of the Navajo Nation Council have once again focused attention on the council's discretionary fund and the way it has been administered.

The fund was created to allow Council delegates to provide financial assistance to tribal members facing emergency situations -- such as paying for funeral expenses -- and were to be provided based on the availability of funding.

Complaint filed last week by special prosecutors allege that four former and current Council delegates, including two speakers, created a scheme to get around tribal laws so they could use the money for their own purposes. Criminal complaints related to misuse of discretionary fund money were first filed by a special prosecutor in 2010.

The Navajo Nation Supreme Court placed a moratorium on all tribal financial assistance programs in January 2011 and ordered the newly created 24-member council to work with the tribal president and the Commission on Navajo Government Development to establish a statutory and regulatory basis for council discretionary spending.

Information on the progress, if any, on establishing that oversight has not been made public.

Jared Touchin, spokesman for the Office of the Speaker, said the council stopped issuing discretionary funding around the time it transitioned from the 21st council to the 22nd council.

"I can tell you for a fact that discretionary funds are no longer available and checks are no longer issued," Touchin said.

Deswood Tome, an advisor to Navajo Nation President Ben Shelly's office, said the office ended the practice of discretionary funding in December 2010 as result of the special prosecutor's investigation.

"To this day it remains suspended," Tome said.

During fiscal years 2005 and 2006, there were no policies or procedures in place and no limits on the amount an individual could receive, according to court documents.

But in February 2007, the Intergovernmental Relations Committee adopted policies and procedures to govern the use of discretionary funds.

Under those policies and procedures, financial assistance could be awarded to elderly Navajos on a fixed income, students, organizations, and unemployed tribal members who are in emergency circumstances.

Tribal members were limited to receiving discretionary funding only once within a 12-month period and were to be issued a 1099 tax form, which declares the money as income.

Authority was also given to the Council speaker to approve or disapprove any financial assistance requests submitted by delegates.

These policies and procedures were implemented "to ensure that adequate internal controls are in place," the resolution stated.

In March 2007, the Intergovernmental Relations Committee amended the policies and procedures to allow discretionary fund grants to tribal members who are employed but facing emergency situations.

It also eliminated the provision calling for a 1099 tax form when financial assistance was provided.

The road to charges being filed by the special prosecutor started in 2009 when the council decided to begin an investigation of former President Joe Shirley Jr. for alleged misconduct in the tribe's business dealings with OnSat and BCDS Manufacturing Inc.

Alan Balaran was hired by the Navajo Nation Department of Justice to investigate those allegations but the scope of his work was later expanded to include the alleged misuse of the council's discretionary funds.

He filed subpoenas and criminal complaints with the Window Rock District Court in October 2010 against 77 delegates of the council, which had 88 members at the time.

Those criminal complaints were later dismissed by Balaran and replaced by civil charges filed in July 2011 against 81 members of the 21st council, former President Joe Shirley Jr., former Attorney General Louis Denetsosie, current Attorney General Harrison Tsosie, Controller Mark Grant and 50 "John Does."

The discretionary fund was administered by the Office of the Speaker, according to a July 2011 complaint Balaran filed in the Window Rock District Court.

Although Balaran's contract was not renewed, the current special prosecutors -- the law firm of Rothstein, Donatelli, Hughes, Dahlstrom and Schoenburg of Tempe, Ariz. -- continue to file criminal charges against tribal officials.

Noel Lyn Smith covers the Navajo Nation for The Daily Times. She can be reached at 505-564-4636. Follow her @nsmithdt on Twitter.