Peterson Zah:

"[Navajo Introduction]. In the Indian way and Navajo way you always identify yourself, who you are, where you come from, who you're related to because, after all, that's what we're all about. And so that's normally the way you start your conversation. Because you're not the only one I'm talking to here in this room. We have other entities that are also here and they always want to know who you are. I wanted to say just two or three words before we get going with what I'm supposed to be doing here.

Number one, I now work at Arizona State University [ASU]; I've been there for the last 14 years. And after the Navajo people kicked me out of office I went down to the University and I started working with young people because, at the time, they only had something like 600 Native American students on campus. And the President says, ‘That's as far as we get. We come to that number then we always come down. Our graduation rate is horrible,' he says. ‘So we need to improve that. Let that be your concern.' He also said, ‘I can't tell you how to do your job because I don't know what to tell you. You evidently know.' And so essentially that's the way we got started. From 600 Native American students to today, we have 1,500 Native American students. Our goal is to reach, within the next five years, 2,000 Native American students. So we're doing very well in recruitment. Our retention rate is improving. Our graduation rate is improving also. And so I wanted to just give you that little commercial. If I didn't say anything about ASU, the President it's going to get back to him and he's going to be angry. So I wanted to just say this.

Number two: I really, really enjoyed the conference here during the last two days. I'm learning a lot and listening to all of the young ones -- all of you, participating in these discussions -- and all of the dedication, and a good sense of where we should be headed all comes out. And as an old man, as a grandpa, that really makes me happy. And we need more of these kinds of training to equip the upcoming leaders with all of the tools that they need so that they can do better among their people in their communities nationwide. So I just wanted to say this.

In terms of the subject today, the establishment of the [Navajo Nation Permanent] Trust Fund, I always tell people that the needs of the Navajo people back then in the mid-1980s were the same as they are now. Some people say, ‘Well, you were able to do all of that because the needs back then weren't as great.' Well, to be honest, they were the same, basically the same. As the tribal chair sitting there at that desk every minute people coming in, they want service, they want to talk to you, they want advice, they want a sense of direction, they want this and they want that. And so your time is occupied a hundred percent throughout the day, almost 24 hours a day -- how they want those services to be rendered to them. And so basically that was the backdrop of the Navajo Nation back in the mid-1980s.

Navajo, as you know, is the largest of all of the Indian tribes, whether it's a pure membership or land base: 88-member council, over 300,000 Navajo people, 110 chapters. And at those chapters you have chapter president, vice president, secretary, treasurer, grazing committee members. So you can multiply 110 times five, and that's how many people you have to work with as an elected official of the Navajo Nation government. So to put your program into place, you have to work with those officers at the community level as well as the 88-member council. So it's not an easy task. You may have a great idea but if you don't do your homework to begin with, you're in trouble right from the word ‘go.' And so with establishment of the trust fund, we had to basically deal with that kind of infrastructure on the Navajo to get to where we wanted to go. I do not know in this room how many of our tribal government, tribal leaders, have tried to create trust fund for the Indian people. I was extremely lucky to be working with a tribal council that had a lot of vision. They were visionary leaders, the 88-member council. I would say probably one half of them had no greater than 10th-grade, 11th-, 12th-grade education. We didn't have a single college graduate but they were visionary in a lot of the things that they did. So we were very, very lucky to have that number in the Navajo Nation Council.

Prior to my becoming a tribal chair I worked at the legal services program called DNA [Diné be'iina Náhiilna be Agha'diit'ahii or ‘attorneys who work for the economic revitalization of The People'] People's Legal Service. I spent 11 years there as the executive director, as a non-lawyer executive director. There were always a lot of people who wanted me to go to law school and I used to tell them, ‘Listen, I'm better off than a lawyer. So I'm going to continue running the program. Because when you become a lawyer, you get tunnel vision and sometimes you can't see things out here. And therefore you have to really, really concentrate on the overall problems of the Navajo people.' And as such I was always working with lawyers to make sure that the cases that we handled at DNA, many of which went to United States Supreme Court, was handled right because I knew that when you get into that court you don't really know what's going to happen. Sure, the lawyers will tell you that they're going to win, this is their argument and this is what we want to do. But we always had a mock trial that we insist our lawyers go through that mock trial -- not only once or twice or three times -- 10 times to have those kinds of sessions before they went into the United States Supreme Court.

So I was intimately involved in Kerr-McGee vs. the Navajo Nation, a taxation case that was accepted by the Navajo Nation to go on to the United States Supreme Court. Within that four-year period, we were able to win in the United States Supreme Court where the tribes were given the authority to tax companies that work on the reservation, that extract minerals on the reservations and that do business on the Navajo Nation. I remember the controversy when we passed that taxing legislation by the Navajo Council, all of the people who do business, companies who do business on the reservation, they all banded together and they said, ‘We're going to sue you because we don't think you have the authority as Navajo Nation to impose taxes on us because we have this contract with you. And we look at that contract as a bible and in there it says we are not to be taxed.' But those were the old leases that were approved by the Navajo Nation Council and the contracting parties. And so when we decided that we're going to start taxing people, they used that against us, the very same thing that the other Navajo Council did in the past.

And so what happened was that we went into court and basically did all of our homework and we [ended] up winning that case. And I remember getting a call from the clerk of the United States Supreme Court saying, ‘I'm just letting you know a decision was made today. It was nine to zero. You guys won the case. That means Indian tribes can now begin taxing companies that operate on the Indian nation.' That was a precedent-setting case. And what that did, what that did was I told the companies, when they decided to sue us in court, I says, ‘As a tribal chairman you get sued every week so it doesn't really matter. And so can I get a concession out of you that while this case is going on can you pay the amount of money that you're supposed to pay in escrow, in escrow account? If you win, you take all the money back. If I win, I take all the money.' And so basically that's how the $217 million was accumulated. So when we won the United States Supreme Court, I went down to the bank and got a check for $217 million. I was the most popular person in Window Rock.

But the question about what to do with that amount of money was really, really something that people, leaders, have to deal with because it was the election year. The 88-member council, they said, ‘We understand you picked up the $217 million. Let's call the council into session and I've got a project. I want to be reelected.' Council delegate from Chinle says, ‘I want to have a laundry, laundromat at Chinle chapter and we'll call it Chinle Wash. We want to have that going because using that I can get re-elected and we'll get further in our progress that we're trying to accomplish.' And so that was something that was really a lot of pressure, activities that happened on the Navajo Nation. The problem was, what do you do with that money? A lot of services are needed. Anything you can think of you can throw the $217 million at those problems because it's election year. And so everyone wanted a role in terms of how they all thought we should spend the money.

My mother is a traditional Navajo lady. She never went to school. She doesn't know a word of English. She has lots of sheep all her life. And every once in awhile she always wants us to come home, spend a night, two or three days with her. So when the pressure got so hot, boiling over in Window Rock, I jumped in my pickup truck and I went home. And I got to the house late in the evening, slept and early in the morning my mother was butchering the sheep. And she says, ‘I'm cooking for the kids.' And then when I got up she started talking. And I told her and she says, ‘Son, I hear all these things on the radio about what's happening in Window Rock. What is happening? What is happening with that money? What did you do with the $217 million that you got from the bank?' And I says, ‘I just put it in the safe and I'm trying to decide what I should do with it.' And so then she started talking about her herd and she says, ‘Is there a way, is there a way that you can treat money the same way as you treat a herd, the sheep?' And she says, ‘Remember, say back several years ago, when our herd came down and we only had 15 sheep and we were all worried? Then I told you kids, let's not eat the sheep anymore for the next two years. If we do it that way, the 15 will multiply to 30 if we leave it alone. The following year we'll have 60. The following year we'll have 120 and we'll be back to where we were. Can you treat money that way?' And this is a traditional Navajo lady talking with me. I could have probably hired a consultant at $400-500 an hour to tell me the same thing, but the mother cares. She's a permanent fixture on the Navajo Nation. She's a tribal member. So I thought to myself, 'Well, she's given me an advice and what she's really, really talking about it is putting money into trust so that it can multiply the same way as her herd multiplied.' And so I got all recharged. At the end of that two-day period, I went back into Window Rock and I went to the council and I says, ‘Ah ha! I've got the answer. Let's put these monies into trusts, let's not spend it. Let's not spend it foolishly. Yes, we all want to get reelected -- I do too -- but let's be prudent. Let's use our judgment in the right way for the Navajo people.' So it was advice that I got from my mother that was highly valuable to the Navajo Nation.

So we sat down with the council and we developed a plan in terms of how that $217 million should be distributed and used to the trust fund. And we established what we call Chapter Government Nation-Building Fund. We put something like $60 or $70 million into that account. That means at the end of the year, whatever interest that it earns those monies were divided among the chapter houses and that's the way their chapter houses operated throughout the year. We created a $20 million Navajo scholarship fund. We had something like maybe $20 million in there already, but we put another $20 million on top of that for something nearly $40 million and we said the interest that this earns at the end of each year will keep the Navajo kids going to college, a college and a university of their choice. So we took care of the chapters. We took care of the young people but not everybody is fit to go to college. Some want to go to vocational education. So we said why don't we take care of them? And we put something like $7 or $8 million into that account. The interest that it earns then can send those Navajo kids to those vocational institutions.

Then we had some problems. There was tremendous need for the handicap people. It was right at this time that old man Ronald Reagan came into power and he cut off all those social programs. Remember back then? Maybe some of you were in diapers still but Ronald Reagan came in and they said, ‘No more of these social programs.' So he cut them. Well, that left the senior citizens out in the cold. We then said, ‘Why don't we have a handicap trust fund?' So we put $7 or $8 million in there for all the elderly people that may need hearing aid -- like the one Manley is wearing -- and hearing aid and all of these other things that they need, the senior citizen. And they're the ones that use that trust fund to help them with some of their problems that they were having. And then there were senior citizens' trust fund. All the senior citizen organizations on the reservation and we put some money into the trust fund for them. And we said that the interest that it earns, ‘You can use that for your activities,' all the seniors.

Then we gave Navajo Academy -- the only Navajo high school, a prep school -- we gave them some trust funds so that they can establish a truly Navajo Nation school. And that was built in Farmington, New Mexico, and today it's still there. They're the only high school on the Navajo Nation that sends every graduate to colleges and university. And I like to go over there and recruit students. So they're the ones that have that Navajo prep academy.

The other one that is not listed, these things happened in 1984-85. In 1990, early 1990, we established three more trust funds. One of them is what we call Land Acquisition Fund. All of you are wondering, ‘Say, how come the Navajo Nation has such a big land base, big huge reservation?' Well, we buy land back. We buy land back. So we created what we call Land Acquisition Fund. There are some ranchers, non-Indian people adjacent to the Navajo Nation that always put their land up for sale. We said, 'When those people make their land available, we should get to the bank, make out a check, buy the land.' Now our reservation is growing. It's getting bigger and bigger and so we established that Land Acquisition Fund. Today it has $50 million, $50 million in that account. So anybody who puts out their land for sale, we use that money to buy land. The reason why we did it is Navajo Nation keeps on growing; the people, the membership is getting larger and larger. We want the land to grow with those numbers. And so every year we purchase more and more land, and we're not going to stop until we get back the whole Southwest. And so that's why we established that fund.

The other fund that we created during that period was a trust fund to take care of a lot of these economic development that's taking place on the Navajo Nation. They have their own trust fund that they can tap into to do economic development projects. And so basically those are the trust funds that the Navajo Nation now has. Now why did we do that? My thought back then was, you can use the $217 million, put them all into trusts. If you have enough trust accounts that you establish, I want to see the day the Navajo Nation government would run on trust fund; we don't have to beg anybody for money. Is that called self-sufficiency all of you young people? Self-sufficiency, that's what we're striving for. Twenty years has gone by. Many of these trust funds are being utilized and they have matured. So much of your trust fund is being utilized to keep the tribal government going.

Now I work for Arizona State University as I told you. We have a rather new president that came out of back east. His goal is to put Arizona State University in a position so that all of these monies that people donate, he puts it into trusts. He calls it endowed funds. And he says, ‘I'd like to put the university in the position where we don't have to go to the state legislature and beg for money each year, we don't have to go see the governor. We want to run this university like NYU, Harvard, Yale, all of those universities. They all run on their own. They're all running on trust funds.' So basically the Navajo concept was to essentially to do the same thing.

The biggest one that we wanted to talk about is the Permanent Fund. It was established because of the natural resources being depleted. I told the Navajo people, I said, ‘We have coal, but you know coal is a non-renewable resource. Once the coal is gone, where are we going to get our money? Once the coal is all extracted from Navajo Land, where are we going to get our income? So while we can, we should put these monies into trust.' So a permanent fund was established by the Navajo Nation. One thing that we had to keep on explaining over and over to the Navajo people is, 'What is the difference between the principal and fund income?' Probably the most simplest thing that you can put across to people, but there was a lot of misunderstanding between principal and the fund income. And we keep on saying, 'We want to make it so that we don't spend the principale when we are at a point of using, beginning to use these trust funds.'

The way it works now is, when the permanent fund was authorized, we put something like $26 million as a basis, as a foundation of the Permanent Fund; we put that in the bank. On top of that we said, '12 percent of all projected revenue shall be invested from the Navajo Nation.' So each year, the Navajo Council comes to decide the budgeting process. The first thing they do is they take, on top of everything they get, 12 percent of that, they put it on top of the Permanent Fund. So the Permanent Fund enjoys two things. One is the interest that it earns goes back into the Permanent Fund. The Navajo Nation uses 12 percent of their general fund total, they put that on top of that. So it enjoys a lot of deposits of money and the generation of revenues that way.

We agreed among the council, I told the council, I said, ‘I want to get an agreement from you that we're not going to ever touch this money for the next 20 years. For the next 20 years, you shall not come to my office and ask that you withdraw these monies. We're going to put it into trust for 20 years and we're going to see what happens, how much money it can generate. After the 25-year period, we will then have a five-year plan where 95 percent of the money could, may be expended according to rules established by the council.' And so that is still in the plan. However, there is no program in place right now for the use of those permanent fund[s]. And so basically that is something that the Navajo Nation agreed to and that they are still, we are still holding them to those agreements. All of the expenses that is associated with the administration and the management of the Permanent Fund comes out of that amount of money that it earns. And so that's what happened to the Navajo Nation and the establishment of its permanent fund.

Today, March 27th -- is it today? -- we have some like $1.4 billion in that permanent fund. This is money that is not earmarked for anything. It's free money. So money in the bank, 1.4 [million dollars]. One of the biggest push by the council every time they come into session is they want to get at it. They want to spend the money. So usually Manley Begay and I are there in Window Rock saying, ‘No, no, no, no. You guys agreed not to do this. Let's keep it growing, let's keep it going.' So thus far, we have been successful and so that is the way this permanent fund and all the other trust funds was established.

Now in 2002, a work group was established called Permanent Fund Work Group. The Navajo Nation Council wanted to get seven people from the Navajo Nation that can decide what to do with that permanent fund. And they made me the chair and then we selected people like Manley Begay and others. And we've been meeting on and off since then and talking about what the future holds for the Navajo Nation trust fund. Manley says, ‘You go first, talk about how these were established, but no joke.' He says, ‘As long as you agree that you aren't going to tell any joke to this group, then you should do this.' So before I crack a joke, I'd like to give him the floor."

Manley Begay:

"The reason why my brother walks around real slow is [because] he has $500 million in both pockets. A good friend of mine, I ran into him again, Curt Massey from White Mountain Apache. I used to play basketball with him years ago. I noticed he was walking real slow, too. I told him, I said, ‘You're walking really slow.' I said, ‘Are you still playing basketball?' He says, ‘No, I don't have any more knees.' I used to play ball with him years ago. We used to be neighbors over there in the East Fork area of the White Mountain Apache reservation. So it was really good to see my brother and good friend Curt Massey. Now he's on the council at White Mountain Apache. And one thing about my brother Pete Zah is that he used to play basketball also, years ago at the Phoenix Indian School, and he was actually on a championship team. So quite an athlete back when.

As Pete was saying, we were selected to this permanent fund work group. And lo and behold, we're sitting on millions of dollars, and it was our responsibility to decide what to do with that money. So I asked Peter, I said, ‘What should we do with the money?' And he said, ‘We should buy Tahiti, the Island of Tahiti, and move over there, get a flock of sheep and herd sheep by the ocean.' But can you imagine the responsibility that's given to you about what to do with that amount of money? In 2002, the money was hovering around $800 million and seven of us, these individuals, we were the ones to decide how the money was going to be spent. As my brother was saying, when they first won the legal case, everybody became his best buddy. They'd come out of he woodwork. The same thing happened again, this time to me, again. People I hadn't seen for years they said, 'Brother, uncle, grandpa, have I got a deal for you.' So can you imagine the amount of responsibility we were given?

And so what do you do? How do you handle this? Because everything's important, right? Grandpa and grandma are important, the handicapped are important, roads are important, health is important, education is important, veterans are important, the youth are important, and there are 300,000 Navajos. Shall we go per cap, 300,000 Navajos? Not much money to go around. And so that was what we were facing. So what did we do? We did a lot of research. First we wanted to figure out what's been happening all these years since the money was put into a trust fund and we wanted to find out exactly how much money there was.

So my brother and I and the five other individuals, we had the fund managers come to see us and we had meetings with them about where the money was at, how the money was invested, where did it go, how much is left and this was shortly, if you'll remember, after 9/11. And the stock markets were really fluctuating around that time. It probably would have been up to $1 billion, but 9/11 sort of made it dip, up and down. And we consulted with the community. One thing about my brother here is that he's very close to the people, the people that are out there in the community. And he said, ‘I want to ask them what they think because that's the heart and soul of who you are.' And he says, ‘We have to go there, we have to go there and ask.'

Then we found out, lo and behold, we found out that in the year 2000 this legislation was passed. The Navajo Nation during an election year earmarked 50 percent of the money to go to this local governance trust fund. And so that remained that only 45 percent of the fund income would be available to us to determine an expenditure plan for and then the 5 percent would be reinvested back into the principal. So essentially this is what happened. So we were actually only dealing with $6.8 million and the vastness of the needs of Navajo is unbelievable and here we were only dealing with about around $7 million. And here we were thinking, we're going to buy Tahiti. But there was a reality check. All of a sudden things began to change very, very quickly. So what to do, what to do?

And so we began to figure out how to do this, what do we do, how do we think through this particular...? So we began to research more and more about how much money there actually was and we wanted to know if there were other extenuating circumstances. This bullet point three. Were there other things that were going on with the money that we hadn't known about earlier? We requested reports from just about everybody at Navajo; we met with the money managers again, we talked to attorneys, we went to the natural resource department. We wanted to know how much time is left for the coal deposit at Navajo? How much more oil do we have left? Because all of that plays into how you plan for an expenditure plan. We held public hearings and then we began to devise a final permanent fund work group report to the Navajo Nation Council. Here is an assumption chart that if coal reserves at our coal mine were depleted, if our oil fields were depleted, what's going to happen to the Permanent Fund trust. And so this middle road is sort of the best route that was imaginable.

So 2008, we're talking about the money hovering around maybe $700-800 million. But as my brother was saying, it's actually at $1.4 billion; so the stocks doing a really, really good job. And here's sort of the market value chart of the Permanent Fund. So you can imagine that in 2010 it would be nearing $1 billion, but it's actually exceeded expectations. Here's another chart that we were working with. In terms of the local governance trust fund -- let's say -- if the money went there, what's the best-case scenario? So we were thinking through what to do with this money and we held public hearings. We wanted to hear from the people. We wanted to hear what the people had to say. And my brother here is like -- remember the old commercial of E.F. Hutton? When Peterson Zah speaks, everybody listens. It's absolutely true. He has that stature that when he goes out to the community, when he talks to the people, people really listen to him. They want to know exactly what he's thinking. To this day, even though he's not in office, he's still a leader. He's still a leader to be respected, to be listened to, to be thought through. So at these community hearings, this is what we put together. And here are the public hearing questions. So we started to gain data and information. And this was actually my brother's idea. He said, ‘We've got to go over there, talk to the people, find out what's going on. Let's pose to them these questions and let's find out some answers about what they're thinking.' And these were their comments.

There was a big push for reinvesting the money, instead of spending it. They said, they told us...these were grandmas and grandpas, people that we would consider sort of everyday people. Very intelligent, smart people. And they said to us, 'Reinvest the money.' But they didn't come out and say, 'Reinvest.' They said this, ‘It's like seeing your corn grow. You should pick the corn only when it is ripe. If you pick it when it's too young, you won't get enough to eat.' So what they were saying was, reinvest the money, put it back. They also said, in reference to the local governance trust fund, they said, ‘There's this huge cow with lots of milk, but only a few calves are allowed to feed, then others are all standing around hungry. The money is like milk, it all goes to just those few.' So they were saying to us, 'Wait a minute. Let's wait a minute.' And then those of us that are living off Navajo Nation land, they were saying, ‘Count us in; don't count us out. Don't call us outsiders. We know our homeland and the homeland knows us. Our umbilical cords are buried in our homeland. We are still your relatives. We are only here because of jobs, education, training and for medical reasons.' Often these services are not available on the Navajo Nation. In the Navajo way, when a baby is, the umbilical cord falls off, there's a whole ceremony that it entails. So where it's buried is where your heart and your soul is at. So no matter where you go, wherever your umbilical cord is at, that's where your heart and soul will be.

And so what did we do, we put together this permanent fund work group report and this is what we said. Number one, we challenged the Navajo Nation Council and we said, and we also challenged the Navajo people, and we said, ‘Develop a vision with a strategic plan for the Navajo Nation as a whole that can provide guidance to those -- including the Navajo Nation Council -- who must make momentous decisions regarding finance and other matters affecting the long-term future of the people.' We said, ‘Reinvest all of the Permanent Fund until 2012, an additional period of five years, or until the corpus of the fund reaches $1 billion, whichever comes first.' As my brother said, it's at $1.4 billion and everybody wants to get at it. And we said, ‘Repeal the legislation requiring the Permanent Fund income go to the local governance trust fund.' And we said, ‘the Navajo Nation should really resist further legislative diversion of the money. It makes the fund quite vulnerable.' And we said, ‘set up an endowment commission.' The endowment commission's responsibility would be to figure out according to policy, rules and regulations, how the money would be dispensed.

Today, what's the future of the Permanent Fund? We're not sure. It's sort of a question mark, although we're all following Mr. Zah's lead. He says, ‘We sometimes as Indian people have a hard time saving. We get a paycheck and then we're driving to town, we spend all the money. We're happy going over there, coming back we're all quiet. No more money.' And he says, ‘We've got to save. We've got to save that money.' So we're following his lead to this very day."