Cory M. Blankenship
Eastern Band of Cherokee Indians
Executive Director of NAFOA
The Tribal Tax and Investment Reform Act is now in both chambers of Congress. Tribal nations must make it clear to Congress that the time for action is now.
Tribal nations are economic drivers across the United States. Tribes operate healthcare centers, build roads, develop affordable housing, generate energy, and employ hundreds of thousands of people, tribal and non-tribal alike. These are not fringe economic contributions. They are the backbone of rural economies from North Carolina to Alaska.
Yet despite their status as sovereign governments, tribal nations operate at a profound structural disadvantage when it comes to the most basic tools of public finance.
The reform act — introduced in the Senate as S.2022 by Sens. Cortez Masto, D-Nevada, and Lisa Murkowski, R-Alaska, and in the House as H.R. 7705 by Reps. Gwen Moore, D-Wisconsin, and David Schweikert, R-Arizona — is the legislative correction that closes this gap.
The gap
Between 2014 and 2020, state governments issued $47 billion in tax-exempt bonds annually, compared to just $84 million issued by tribal governments, meaning states issued bonds at a rate more than 559 times greater than tribal nations. On a per capita basis, state and local governments averaged $597 in tax-exempt bond financing per resident. For tribal citizens, it is $127. That gap has real consequences in our communities: healthcare facilities not built, infrastructure not improved, homes not constructed, and jobs not created.
The reason for this disparity is structural.
Under current law, tribal governments must pass an “essential governmental function” test to issue tax-exempt bonds, a requirement that does not apply to states or municipalities. A municipal golf course can be financed with tax-exempt bonds. A tribal golf course cannot. A state lottery is a governmental function. Tribal gaming is not. These distinctions are bureaucratic artifacts that have compounded over decades into a structural disadvantage with measurable economic consequences. Equal access to public finance tools is not preferential. It is the baseline that every other government in the country already enjoys.
What the Tribal Tax and Investment Reform Act does
The reform act addresses decades of tax code inequity through targeted, practical reforms. The legislation eliminates the “essential governmental function” test and grants tribal governments access to the same bond financing tools available to every other government in the United States. It opens the door to the $58 billion Qualified Private Activity Bond market, enabling tribal investment in affordable housing, utilities, infrastructure, and economic development at lower capital costs.
For a single $50 million bond issue, equal access to tax-exempt financing translates to more than $26 million in savings over 25 years. That is $26 million that stays in tribal and rural communities invested in services, infrastructure, and the next generation.
Beyond bonds, the reform act creates a dedicated $175 million annual New Markets Tax Credit allocation for tribal areas, ensures Indian areas qualify as “difficult development areas” for the Low-Income Housing Tax Credit, makes the Indian Employment Tax Credit permanent, and ensures that tribal general welfare benefits do not inadvertently disqualify tribal elders and families from federal programs like Supplemental Security Income. These reforms are interconnected. Together, they remove the artificial barriers that have forced tribal governments to do more with less for decades.
Tribal nations are essential to the national economy
When tribal economies grow, surrounding regions grow with them. Tribes are major employers, healthcare providers, housing developers, energy producers, and infrastructure builders in communities that often have no other anchor institution.
In northeastern Washington, the Confederated Tribes of the Colville Reservation used New Markets Tax Credits to build a government center that consolidated essential services, created construction jobs, and generated permanent employment for the region.
The Citizen Potawatomi Nation used the same program to open the FireLake Hotel, creating 30 new jobs and boosting local tourism in Shawnee, Oklahoma.
These are not outliers. They are a preview of what is possible when the policy environment is conducive to tribal economic success.
The reform act has bipartisan support because its case is clear. Closing the financing gap in Indian Country means stronger tribal communities, more jobs, better infrastructure, and more resilient regional economies. Rural economies are stronger because of the contributions of tribal nations.
Tribal nations have already demonstrated what they can do with limited resources. Passing the reform act is a step toward the United States honoring its trust and treaty obligations. The momentum around tribal economic issues this year is tangible, and it must be sustained to carry the reform act across the finish line.
Tribal governments must make their support known and push Congress to act this session. The question before Congress is simple: what becomes possible when we finally remove the barriers?
The answer for tribal communities and for the nation is prosperity.
Cory M. Blankenship, Eastern Band of Cherokee Indians, is the executive director of NAFOA and brings over 17 years of experience in tribal finance, non-profit leadership, and philanthropy. Founded over 40 years ago as the Native American Finance Officers Association, NAFOA advocates for policies that strengthen tribal economies and expand economic opportunity in Indian Country.
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