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President says there not 'sufficient justification' for tribe taking out $20 million loan

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FARMINGTON — Citing a lack of justification, Navajo Nation President Russell Begaye on Monday vetoed a resolution seeking a $20 million loan for new airplanes for the tribe.

The resolution would have authorized the tribe's Office of the Controller to secure a loan from KeyBank to purchase three new Beechcraft King Air turboprop aircrafts. The loan would have also paid for associated costs, such as pilot training, warranties and maintenance costs.

"As leaders of the Navajo Nation, we must be prudent and fiscally responsible to our people and for our government," Begaye said in a press release his office issued Monday.

Begaye's veto is explained in a two-page memorandum to Speaker LoRenzo Bates and the Navajo Nation Council.

In the president's remarks, he mentioned his office issued a memo on July 9 outlining four issues with the legislation. He stated that although that letter was attached to the bill while it was under the council's consideration, those concerns were not addressed.

Begaye wrote in his memo that the legislation did not provide "sufficient justification" for the loan.

He recommended that a comprehensive feasibility study be conducted to identify available options. The study could also examine service debt, equipment and costs, such as maintenance and supplies, he stated.

“This administration is not going to support efforts blindfolded,” the president wrote.

The president also states the bill does not identify the funding source and the collateral that would be used for the loan.

Further, the president stated his office believes the terms of the loan that were attached to the bill constituted a limited waiver of sovereign immunity, which would require an additional waiver of sovereign immunity by the council.

Any approval of limited waiver of sovereign immunity requires 16 or more votes by the council, he wrote, and the legislation did not have that when the council passed it 13-5.

The president also wrote that the loan's non-impairment clause was "too broad."

"I understand the financial institution's concern is the Navajo Nation would not enact a law that would allow for the nation to not carry out its obligations under the loan. We recommend the language to be written very narrow and clear it is limited just to this loan,” Begaye wrote.

Delegate Davis Filfred sponsored the bill and has said buying the planes is necessary because the tribe’s current aircrafts are more than 30 years old.

Filfred could not be reached for comment on Monday evening.

The council passed the bill on Oct. 20 during the fall session. At the time, it caused debate, with some delegates questioning the purchase and others supporting it due to safety concerns.

Noel Lyn Smith covers the Navajo Nation for The Daily Times. She can be reached at 505-564-4636.

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