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February 15, 2020 | Tribal Business League

The Power of the Tribal Dollar

he hidden power of the tribal dollar, and how it can help grow tribal economies

The year is now 2020, and we are seeing a transformative process taking place before our eyes. We are seeing tribal communities, and tribes themselves, starting to diversify their economies. Historically, tribes would develop a local enterprise which produces revenues for the tribe to support employment opportunities, community reinvestment, social programs and services, as well as protecting sovereignty. The first phase of true economic diversification came in the form of gaming.

Indian Gaming Regulatory Act of 1988

According to the National Indian Gaming Commission, “Tribal gaming, as we think of it today, dates back to the 1970s when a number of Indian tribes established bingo operations as a means of raising revenue to fund tribal government operations.” However, the federal government did not go silently into the night. This was a hard fought battle up until 1987 with the California v. Cabazon Band of Mission Indians, 480 U.S. 202 decision. This case in particular provided teeth to the tribes with the passing of the Indian Gaming Regulatory Act of 1988.

The Current State of Gaming

Today, Native American tribes have casinos, bingo halls, punch boards, pull tabs, and various forms of Class II gaming operations. These gaming operations produce millions of dollars in revenue. These dollars are utilized to provide employment opportunities, promote tourism, pay for utilities, and reinvest back into the tribe for social programs, and services.

The Newest Economic Development Enterprise

Flash forward to the year 2020, tribes from coast to coast are entering into the world of online lending. Commonly referred to as a Tribal Lender Enterprise (TLE). Unlike the federal, state and local governments, which fund operations through levying taxes, Native American tribes rely on economic development enterprises to provide essential government services to their members. Reservations, historically, are isolated far from major metropolitan areas and have limitations and a capacity on annualized revenues from economic development enterprises. The emergence of e-commerce enterprises, technology and innovations...enter the Tribal Lending Enterprise (TLE). This allows tribal communities to generate revenues beyond the boundaries of the isolated geographic reservations. Essentially, anyone with a mobile device, laptop or tablet and internet connection can become a customer.

According to Mary Jackson, CEO of the Online Lending Alliance, she goes on to state, “In short, they allow tribes to be more independent and self-reliant, and tribes have created their own enforcement practices and regulatory bodies to ensure they are in the driver's seat.”

This is one of many ways tribal communities can diversify their economy, and no longer rely on on-reservation transactions, or gaming revenues in seasonal areas.

Intertribal Commerce & Collaboration

Another initiative that is sweeping the Great Lakes states is the formation and development of a tribally-led buying club. The Tribal Business League was formed in September 2019 with the tribes; Lac Courte Oreilles, St. Croix, Bad River, and Red Cliff. The development included leveraging the collective purchasing power of numerous enterprises; casinos, tribal administrative buildings and programs. The collective purchasing power enabled the Tribal Business League to begin making purchases which dramatically decreased the cost-of-goods-sold (COGS). The significance of this development stood within the intertribal commerce realm. The first ever tribally-led non-profit buying club; whereas tribal leaders from various communities are working together to achieve a common goal. This initiative allowed tribes to keep more money in their budgets, enterprises and local economy. Additionally, the increased margins at point of sale, provided more opportunity to increase wages, create new jobs, and provide more distributions to the tribes for programs and services.

The Power of the Dollar

We have all heard of the multiplier effect, and how it can make an impact on a local economy. According to various studies, 14% of purchases made at chain retailers stay in the community. Conversely, 52% of purchases made at a local retailer stay in the community. This is a significant difference when the weight of the purchases include millions of dollars in revenues.

In the example of a $10,000,000 revenue operation like a McDonalds or other big box chain, just 14% or $1,400,000 stay in the community. If we as consumers spent those same dollars at local businesses providing similar goods and services, $10,000,000 in revenue would keep $5,200,000 in the community. In a perfect economy, every dollar spent, has a 7x multiplier effect. Simply put, this dollar would be passed through hands seven times before it is fully dissolved.

However, when we look at big box chains $1 spent, $0.14 stays in the community. Those $0.14 are spent again in the community to the tune of $0.0196. There is no third turnover.

The same scenario is applied to local businesses with $1 spent, $0.52 stays in the community. Those $0.52 are spent again and provide $0.27 reinvestment. Another purchase or change of hands produces another $0.03. If we changed hands one more time, we reinvested another $0.196.

These are simple examples of how the power of the dollar can make deep impacts within our communities by making local purchases with local businesses. In addition to the multiplier effect; we also consider the tax levy applied to sales which are provided to federal, state and local governments for programs and services, infrastructure, health care, and the like.

The Power of the Tribal Dollar

Now, we do realize that tribal economic development is much more complex than that of federal, state or local government. Economic development enterprises provide the dollars to fund employment opportunities, enterprise, infrastructure, health care, programs and services that meet the needs of the people. While various programs and services are grant funded; the majority of tribes are funded an average of 56% of the tribal needs. This leaves a gap of 44% of programs and services under served.

Where do those dollars come from to help fund these operations?

The answer is economic development enterprises.

When we take the full spectrum of revenue production enterprises; gaming operations, tribal lending enterprises, retail enterprises, health care, restaurants, and the like, we have tribes with funds to cover the costs of tribal operations.

There are tiers to the structure of optimal tribal reinvestment. When we look at gaming operations or casinos. These casinos pay employees, contractors, and pay for office supplies, cleaning supplies, equipment, and machinery. All of the aforementioned can be tribal members. Additionally, we also need to look to the future. The here and now is great, and we can plan, strategize, and develop until we’re blue in the face but sustainability should be a priority on that list.

Tribal reinvestment tiers;

  • Tribal Entrepreneurship

  • Tribal Employee Development

  • Tribal Youth Development

1. Tribal Entrepreneurs

Tribal entrepreneurs can provide services directly to casinos, tribal lending operations, restaurants, retail locations, tribal administrative buildings, and other tribal needs. This is a fostering of tribal entrepreneurship.

2. Tribal Employee Development

Tribal employee development is another key element of the power of the tribal dollar. Tribal employees are just like any other employee; they’re human. They have basic essential needs of housing, food, water, clothing, and sleep. Beyond basic needs, humans love entertainment, going out to dine, travel, or purchase luxuries.

3. Youth Development

Youth Development is something often overlooked in the grand scheme of economic development initiatives. Tribal entrepreneurs, tribal employees and tribal leaders are people. People grow old, and retire. The new wave needs to be fostered and prioritized in economic development and strategic planning.

The power of the tribal dollar goes far and beyond that of just reinvesting back into programs and services to provide for the elderly, children or needy. These tribal dollars should be going into developing our tribal employee workforce, hiring tribal entrepreneurs to provide goods and services, as well as program creation to foster tribal entrepreneurs, tribal leaders, and tribal employees.

Tribal Dollar Prioritization

The tribal dollar should go into five specific buckets to go towards self-sufficiency and self-reliance. These five buckets come in the form of;

1. Data Collection

Collecting data from programs and services are common. Tribal programs and services are required to collect data to report back to grant funding agencies. Tribal enterprise should also be collecting data. Consumer data can range from demographics, psychographics, consumer spending habits, employee key performance indicators, key business metrics, and profitability. These forms of data are necessary to ensure proper levels of efficiency, minimizing waste, and increasing top-line revenue, as well as bottom line metrics.

2. Education

Continually, we strive to make investments into education for tribal members. Educating tribal members, by theory, with more education allowing them to come back to the reservation and be of service in various programs, services or enterprises. This comes in the form of culture, language, health care, education, facilities, and many other critical tasks necessary to have a functioning and thriving tribal government. The greater the education, the more affluent the tribe, the more affluent the tribe, the more affluent the tribal membership and citizenship. Are our tribal colleges and universities (TCU’s) equipping our community members with the necessary skills to meet the workforce development demands? TCU’s focusing on training and vocational programs to equip tribal members with necessary skills to fill employment vacancies is necessary to meet the needs of the “tribal preference” policy most tribes utilize.

3. Opportunity

In this context, I will refer to opportunity as entrepreneurship and intrapreneurship. When auditing the tribal spending amounts, we look at goods and services purchased from outside entities. This happens in every single tribe across the United States. Fostering tribal entrepreneurship helps create opportunities for those where jobs are not present.

4. Technology

Technology has become a fabric in every inch of our life. Whether you’re a tribal employee, elected official, tribal entrepreneur, student, teacher, nurse, or other critical member in the day-to-day operations of tribal operations, technology is a necessity. Investing in the very technology that makes our programs, services, and enterprises more efficient, scalable, and profitable is crucial. This enables tele-learning, tele-health, and vastly improves upon the communication among all programs, services and enterprises.

5. Youth Development

Most importantly, investing in the youth beyond that of after-school programs becomes more important each and every year. Tribes from coast to coast are reporting increasing shortages in quality talent to hire from within when considering filling employment vacancies. Investing in youth services beyond that of enrichment programs and focusing on skill enhancement, job training, culture and language programs are more important than ever. School-to-work programs and on-the-job training are programs very few tribes engage in. While there is nothing wrong with hiring outside of tribal preference, employing tribal members can go a long way to ensuring that our tribal dollars are staying in the community.


In conclusion, when tribes take a strong stance on economic development and place an emphasis on truly becoming self-sufficient and self-reliant there are five factors that need to be met.

When tribes diversify their economic profile, engage in reinvestment into data, education, opportunities, technology, and youth development, there is a recipe for long-term sustainability and leveraging the power of the tribal dollar.

The goal of the Tribal Business League and the mission statement rings loud, “Tribes helping tribes achieve business success.” This is accomplished by enabling and empowering tribes to work together to achieve a common goal; success. Success can come in many forms, but sustained success is something that can be shared by tribes from coast to coast. The book “Economic Evolution: 5 Pillars of Sustainable Tribal Economic Development and How We Can Get Involved” speaks to the five factors should place an emphasis on in order to diversify the economic profile, and reinvest back into the people of the community.
Tribal Business League
LCO Box 1711
Hayward WI 54843
(715) 638-0481

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