A Case Study for the Inland Northwest Economic Adjustment Strategy
Population 4,000
60 jobs lost due to timber harvest reductions
31% reduction in per capita income from 1994-1998
Economic Development Strategies include establishment of a second casino and a business-development corporation
Hydropower remains a steady source of income
The Confederated Tribes of the Warm Springs Reservation govern approximately 640,000 acres in north central Oregon State. Situated between the Cascade Crest and the Deschutes River it includes the southwest corner of Wasco County and the northwest corner of Jefferson County. The reservation is home to about 4,000 people, mostly members of the tribes. Except for the narrow valley carved by the Deschutes River, the terrain is dry, high desert sliced by steep canyons. The Reservation is located just north of the state's fastest growing region where outdoor recreation, second home development, and a burgeoning technology sector are attracting new residents.
Today, we are very concerned about the adequate protection and use of habitats, places of significance, traditional use areas, and especially our sacred sites. The People's Plan
Sustainable resource management is nothing new to the people of Warm Springs. Honoring the land and the gifts it bears are central to the cultural identity of the Tribes. Prior to European settlement, the Warm Springs and Wasco Tribes occupied some 10 million acres of what is now north central Oregon. The association between people and land was based on stewardship and sustainable use of resources. Salmon and salmon fishing were major components of the Warm Springs and Wasco economies and cultures.
Nineteenth century settlers brought with them opportunities for trade, a fundamentally different approach to land use, and diseases that would kill many of the native people. Tribal culture in general suffered from US policies for many decades. In 1855, the Warm Springs and Wasco Tribes entered into a treaty with the United States Federal Government, ceding direct control over most of the territory that they had inhabited from time immemorial while retaining exclusive use of the Reservation as well as certain rights in the ceded territories. Between 1879 and 1884 members of the Paiute Tribe that had occupied what is now Central and Southeastern Oregon were also settled on the Warm Springs Reservation.
In 1937, the three tribes organized as the Confederated Tribes of the Warm Springs Reservation of Oregon, by adopting a constitution and bylaws for tribal government. The Tribes manage a complexity of roles far greater than the typical American community of 4,000 people. Tribe members are citizens of the Tribes, the United States, and the State of Oregon. The Confederated Tribes are a sovereign nation, in many ways equal to the United States government with which they entered into and maintain a treaty relationship. They interact with federal, state, local, and regional government entities both as an equal or peer and as a member or constituent. The Tribes provide the services of local governments, development agencies, and non-profit organizations-from police services to housing and health care. Further, the Tribes' own almost all the land and resources within their boundaries and operate a variety of businesses.
Economic Development Challenges
The Tribes face many of the same difficulties experienced by other Columbia basin communities, including seasonal employment and high unemployment (17% in summer, 35% in winter). Like other basin communities, the Tribes' economy has been heavily natural-resource dependent, and they are diversifying while also adapting, changing, and further developing resource-based activities.
Tribal ownership of land has repercussions in the realms of business financing, land development, and home ownership. There is very little privately owned business on the reservation. The situation is complicated by Bureau of Indian Affairs (BIA) regulations that guide residential and commercial development opportunities. The community's dispersed population complicates development of physical infrastructure. Tribal leaders see the under-developed private sector and the lack of infrastructure (both physical and legal) as challenges.
Because the Tribes are both the chief landowner and major employer in the community, reduced income from resource-based business affects both tribal government and Tribe-owned businesses. Between 1988 and 1996, timber receipts dropped by 23%, resulting in reductions in both workforce and operating budgets. Reductions in timber harvest and market changes resulted in loss of 60 jobs (about 6% of the workforce) in February 2001, and there is talk of additional layoffs this summer. Overall, Tribal revenue has dropped from $10,851 per capita in 1994 to $7,495 per capita by 1998.
Economic challenges are compounded by social issues. Education levels in the community are low and substance abuse, crime, and gangs are all major problems. Median incomes on the Warm Springs reservation are the lowest in Central Oregon- 84% of the median in Jefferson County and 73% of the median for the region.
Susan Guerin's story illustrates the social challenges tribe members face. Susan's grandfather spent most of his childhood in an Indian boarding school where the children and their culture were demeaned. At 13 he ran away and went to work as a logger. The work was dangerous and demanding, and the boy was forced to live and work like a man. "If he didn't do well, they would send him back to school-like being sent back to prison." He also learned to drink like a man, using alcohol to escape his memories. Although he is now a Christian and recovering alcoholic, his son and grandchildren still suffer from the legacy of his substance abuse and anger. Susan has consciously worked to overcome the family legacy. She is a gymnastics coach and is committed to raising and supporting the self-esteem of young people. She is working on a BA and intends to go on to graduate school; she is active in tribal politics, following a path she associates with her grandmother. "I felt the hurt and wanted it to change for the future. The past hurt doesn't equal future hurt."
Community and Economic Development Strategies
Warm Springs has adopted both a comprehensive plan (The People's Plan) and an economic development strategic plan for the years 2000-2020. The People's Plan reflects a community benchmarking process and lists benchmarks relating to people and sovereignty, cultural assets, and economy and money. Goals include "We preserve, protect and enhance our cultural, environmental and natural resources" and "Our growing economy meets the income, employment and business needs of our community."
The economic development strategic plan was written to be consistent with The People's Plan and to reflect current priorities. It includes four major focus areas: tourism and travel, industrial recruitment/expansion, commercial and retail development, and tribal business investment. The plan highlights the importance of total community development, in which social, political, natural, and economic environments are integrated.
The Tribes' economic development strategies include:
- Continued co-operation of the Pelton-Round Butte Hydroelectric system to ensure both ongoing revenues and control over resources.
- Establishment of a second casino, probably at a site along the Columbia River near Hood River.
- Development and exploration of additional business opportunities. Examples include expanded diatomaceous earth fire retardant building products and essential oil extraction and marketing. The latter concept has evolved to include extraction of oils from waste produced by the Tribes' logging operations, and use of the residues from oil extraction to help fuel the tribal mill's power plant, so resources are used as fully as possible.
- Formation of a business-development corporation, to facilitate quick, effective responses to new business opportunities.
- Development of legal infrastructure for business is underway; a secured transaction code and limited liability company policy have been adopted.
- The Tribes have identified, but not yet been able to implement, a number of planning projects to address components of the strategic plan and infrastructure needs identified under the "Economic Development Challenges" heading. They include needs such as a legal infrastructure plan, a telecom strategic plan, and a priority capital projects plan.
Resources, Players, and Partnerships
The Tribes' 1937 constitution established an 11-member council to oversee all tribal operations. The council includes the 3 tribal district chiefs and 8 members elected by the residents of their districts (2 Seekseequa south, 3 Warm Springs central, 3 Simnasho north). Tribal government also includes a General Council composed of all adult Tribe members. The councils play a substantial role in economic development because of the government's position as landowner and owner and operator of most of the community's business enterprises. In 1938 the Tribes formally accepted a corporate charter from the United States for their business endeavors. Warm Springs established a Small Business Development Center (SBDC) in 1992. The Center's offerings include a grant program for Tribe members.
Warm Springs is an actively-involved member of the Lower John Day Regional Partnership/Regional Investment Board and the Central Oregon Community Investment Board (COCIB) and a charter member of Economic Development for Central Oregon (EDCO). Sal Sahme, the Director of the Tribes' Business and Economic Development Department was recently appointed an ex-officio member of the Central Oregon Intergovernmental Council's Board of Directors.
The Tribes maintain longstanding partnerships with numerous agencies and other organizations. Some result in funding support; the Tribes receive $15-20 million annually in federal and state grants. Partnerships support economic and community development and social and environmental goals.
Successes
The scale of Warm Springs' successes is out of proportion to the community's size. Tribal businesses include Warm Springs Forest Products, Warm Springs Power Enterprise, Warm Springs Composite Products, Kah-Nee-Ta Hot Springs Resort and Convention Center, Indian Head Gaming Center, and many other enterprises. The enterprises provide both jobs and revenue for tribal operations. In addition, the Tribes have established facilities such as a Health and Wellness Center and The Museum at Warm Springs, negotiated water and fishing rights with the state as a sovereign nation, and secured grant funding for economic and infrastructure development projects. Tribe members will vote in an upcoming referendum on an agreement with the Jefferson County School District to build an elementary school on the Reservation.
While timber revenues have fallen in recent years, hydropower remains a steady source of income, and is likely to remain so. The Tribes are currently involved in a re-licensing process that will establish a framework for hydropower operations over the next 50 years.
The Tribes' small business development center has contributed to the success of enterprises ranging in size from cottage industries that provide the family with a second income to operations with substantial capital and workforce investments.
Pinky Beymer and her husband began a small excavation business, Chilkat Enterprise, in 1989. Starting with one employee, they grew to a peak of 56. The shrinking timber industry, decreases in construction in western Oregon and recently in central Oregon, and changes in Tribal construction programs and policies have reduced the work available and made the market much more competitive. An SBDC grant leveraging a tribal loan has allowed them to restructure debt and purchase new equipment to remain viable and able to compete in the changing marketplace. Mrs. Beymer is committed to supporting the health of her community by hiring reservation residents and maintaining a stable workforce and a drug-free workplace.
The Tribes encourage education and provide support through an excellent scholarship program and trust fund. The last few years have seen an increase in the number of tribe members pursuing higher education.
Lessons Learned
Community involvement is very important in Warm Springs, especially when a project has significant environmental, social, and cultural impacts. When Tribe members are sought out and involved in decision-making, elected officials will get behind projects, a champion will emerge, and projects will move forward. If the community is not involved, it is difficult to "sell" the project.
The process of community involvement is time consuming, which can be problematic when business opportunities require quick response. The Tribes are in the process of establishing an economic development corporation to create new businesses and joint ventures. It will be able to respond to opportunities more quickly than Tribal government.
Conclusion
Warm Springs has well-developed mechanisms for planning and funding projects, a rapidly evolving framework for economic development, and the ability to negotiate complex and sophisticated agreements. The Tribes' capacity is tempered by resource, market, and social challenges. The community has faced those challenges head on, and is actively seeking the resources to address identified needs in the context of its unique cultural identity.
