For the Record: Title 40, the Per Capita Ordinance

Hoopa Tribal Members Dispute the Meaning of Title 40 and What to do About Per Caps

By Kristi Shelloner, Two Rivers Tribune

On Friday, Sept. 30, the Hoopa Tribal Council passed a continuing resolution for the first month of FY 2012. Departments and programs will continue to be funded at current levels through Oct. 31, 2011. After the meeting was adjourned, council remained in chambers to discuss the meaning and requirements of Title 40, the per capita ordinance.

Councilmember Hayley Hutt expressed concern that Title 40 was not being interpreted to the advantage of tribal members. “I’m saying the referendum was passed by the membership because people wanted a policy that guaranteed their shares as shareholders and not just when the council felt like paying it…. People voted for an authority and that should be regarded.” said Hutt.

Councilmember Joe LeMieux countered that the interpretation of the ordinance was not certain. “Our priority is passing a budget,” he said. “We need to do that before we deal with per-cap. What is the mandate of the ordinance? That ordinance gave us a ball-park estimate not a mandate.

“Do we hold it to the letter of the law or the spirit of the law? We don’t always pay a per-cap four times a year. How do we pay per-cap if we have no money?” LeMieux said.

Chairman Leonard Masten said “the ordinance says go back two years. We never do that, we pay out of current year funds, not out of stumpage.”

In addition to the dispute on the meaning of the ordinance, Hutt said that senior payments have been taken out of the funds pinpointed for per capita payments, leaving little money left to make per capita payments the rest of this year.
“Senior payments, which I support 100 percent, are entitlements and not per capita payments. The funding source (for the senior payments) should be identified,” she said.

Hutt suggested that the special deposits to Forestry of 10 percent of the timber sales could be reduced to one percent and the remaining balance returned to the funds maintained for per capita payments. She asked if enterprise funds could be used to replace the money that Forestry would lose in the process.

LeMieux disagreed on contributing enterprise funds in this way. “If you pay from there, it’s taxable income,” he said.

For The Record

Section one of the per capita ordinance states the following:

“The purpose of this Ordinance is to make the process of issuing per capita payments to Tribal members fair, equal and fiscally responsible, to set out standards that balance and harmonize the objective of the Tribal government to offer services, seek economic opportunities and protect and enhance the rights and natural resources of Tribal members, with the objective of the Tribal government to assure that Tribal members receive sufficient financial support to assist them in caring for their children and grandchildren and for whatever their requirements may be from time to time. This Ordinance is not intended, nor shall it be so interpreted, to create a right to any specific Tribal government service or to create a right to any specified payment to Tribal members.”

On the other hand, section four states:

“…Per capita payments shall be made four times annually, on the second Wednesday of the months of March, June, August and December.”

And, section 4.3 states:

“Tribal members shall receive notice of per capita payments via the U.S. Mail by Oct. 15 of each year. Subsequent notices of payments throughout the year shall be made in the Tribal Newsletter thirty (30) days prior to the payment date.”

Under section 4.3.1, the annual notice to be sent to each tribal member at the start of the fiscal year “shall include the following: the total amount to be distributed by the Tribe over the upcoming year, based on the calculation set forth in Section 5 (see below); the dates certain for the per capita payments in that year (emphasis added.)”

Section 5 concerns the amount of the payments and how they are calculated. “Per capita distributions shall be based upon the revenue earned in the fiscal year two years prior; for example, the distribution for fiscal year 1997 shall be based on the revenue of fiscal year 1995, using the accrual method of accounting. The revenue for a single fiscal year shall be derived from….stumpage payments received into the Trust account; interest income on stumpage payments received into the Trust account; royalty payments; interest income on the Trust account; interest income from the General Fund account; miscellaneous payments (e.g., business, residential); and, 15% of the Tribal entities’ net profits.
“The total revenue derived from the sources (defined above) establishes the Gross Revenue for determination of per capita payments. 40% of the Gross revenue shall be distributed to the Hoopa Tribal members…”

The other revenue sources cited in section 5.3 include funds from settlements, lawsuit awards, and various other sources will(sic) be determined by the Tribal Council on a case-by-case basis.
Finally, in section seven, the ordinance states “…none of the funds which are distributed per capita shall be subject to Federal or State income taxes, nor shall such funds, nor their availability, be considered as income or resources, nor otherwise utilized as the basis for denying or reducing the financial assistance or other benefits to which such household or member would otherwise be entitled under the Social Security Act….or, except for per capita shares in excess of $2,000, any Federal or federally assisted program.”

The final answer for ensuring per capita payments to tribal members for this year and, perhaps, next year, may not hinge on reconciling the contradictions and constraints within the ordinance itself, or the degree to which the ordinance is properly followed, but it will be affected by the health of the general fund, the interest income it generates and revenue from the tribe’s timber endeavors.

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