Navajo Nation leaders approve using trust fund interest to help fill annual budget gap
Navajo Generating Station, Kayenta Mine closures in 2019 impacted tribal revenues
FARMINGTON — A bill signed last week by Navajo Nation President Jonathan Nez will use the earned interest of the Permanent Trust Fund to help the tribal government's annual budget for the next five years.
Members of the Navajo Nation Council passed the bill in April as a solution to replace dwindling revenue from the 2019 closures of the Navajo Generating Station and Kayenta Mine.
According to the bill, $40 million will go to the comprehensive budget for fiscal year 2022 through fiscal year 2026 to cover government operations.
Nez signed the bill on May 7 in a ceremony in Window Rock, Arizona.
"Working together with the council, we've developed this new five-year plan to help cover direct services and provide for financial stability for the next five years," Nez said in a press release.
The Permanent Trust Fund was established in 1985 by a tribal council resolution and with the initial investment of approximately $26 million, which was received as part of an award for a taxation lawsuit.
When the fund was created, council members placed a provision to restrict using the interest for 20 years. It also mandates that before 95% of the interest can be spent, a five-year expenditure plan must be approved by tribal leadership and the remaining 5% be reinvested into the principal.
This is the second time tribal leaders approved a five-year expenditure plan.
In 2016, then-Vice President Nez, President Russell Begaye and the 23rd Navajo Nation Council approved an expenditure plan to cover infrastructure, economic development and agricultural projects.
On May 7, President Nez and Vice President Myron Lizer stated in their message to Speaker Seth Damon that the new expenditure plan is a step in addressing the declining revenue for fiscal year 2022 and beyond.
"This measure, along with reserving a portion of the Unreserved Undesignated Fund Balance, is prudent planning in keeping with the tradition of our parents and grandparents. Working together we can tackle the needs of our people and we look forward to partnering with the legislative and judicial branches to solve the revenue challenges we face," they wrote.
"As we have noted previously, this five-year plan will ensure the Navajo Nation will have an opportunity to deliver direct services, to provide for the health and safety of our citizens, and to continue vital government operations," they continued.
The council passed the bill on April 20 in a 20-2 vote. Delegates Eugenia Charles-Newton and Vince James voted against the legislation.
Noel Lyn Smith covers the Navajo Nation for The Daily Times. She can be reached at 505-564-4636 or by email at email@example.com.
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