Judge Rules Treasury Must Stop Disbursing Virus-Relief Funds to Alaskan Native Corporations

This 2015, file aerial image shows the island village of Kivalina, an Alaska Native community of 400 people. (AP file photo/Andrew Harnik)

(CN) — A federal judge blocked the Trump administration on Monday from distributing coronavirus emergency funds meant for Native American tribes to hundreds of Alaskan for-profit corporations.

The U.S. Department of the Treasury has deemed Alaska Native corporations — 230 construction companies, military contractors and other private businesses with some tribal rights, such as owning and selling tribal land — as eligible for part of $8 billion set aside for tribal governments in the $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act.

But six tribes, which were later joined by seven more, sued Treasury Secretary Steven Mnuchin to block the corporations from getting the funds because, although they have some tribal rights and associations, they are not “tribal governments,” which is the wording the CARES Act uses.

On Monday, U.S. District Court Judge Amit P. Mehta issued a preliminary injunction to temporarily keep the Treasury Department from writing checks to the corporations. Mehta stopped short, however, of the tribes’ full request to order the department to immediately distribute the $8 billion to recognized tribes.

That money would be split among 574 federally recognized tribal governments, the plaintiffs said in their April 17 lawsuit, meaning the funds would be significantly diluted if the 230 corporations are included. And getting that money back might be impossible once it’s distributed, the tribes argued.

“Preliminarily enjoining the secretary from disbursing funds to (Alaska Native corporations) remedies the immediate harm that plaintiffs face — the payment of Title V funds to (the corporations) that will be unrecoverable once made,” Mehta wrote in a 34-page order Monday. “The added relief that plaintiffs seek — an order directing the secretary to distribute the full $8 billion only to federally recognized tribes — is greater than necessary to protect them against that injury.”

If Treasury obeys the injunction and withholds the funds, the plaintiffs might still get less money immediately but that money could be distributed later if the court enters a final judgment in the plaintiffs’ favor, Mehta wrote.

The corporations have argued that they provide valuable support to tribes and tribal governments, including employment, scholarships and land management, but Justice Department attorney Jason Lynch admitted in a hearing Friday that the federal government has struggled to define what constitutes an Indian tribe.

“We here this afternoon are not the first to wrestle with this definition,” Lynch told Mehta, a Barack Obama appointee.

A a woman walks before dawn in Toksook Bay, Alaska, a mostly Yuip’ik village on the edge of the Bering Sea, on Jan. 20, 2020. (AP Photo/Gregory Bull)

The Confederated Tribes of the Chehalis Reservation, Tulalip Tribes, and the Houlton Band of Maliseet Indians from the lower 48 were joined by Alaskan native governments Akiak Native Community, Asa’carsarmiut Tribe and Aleut Community of St. Paul Island in the lawsuit. They were later joined by the Navajo Nation, Quinault Indian Tribe, Pueblo of Picuris, Elk Valley Rancheria, and San Carlos Apache Tribe.

That lawsuit was later combined with two others from the Cheyenne River Sioux, Oglala Sioux, Rosebud Sioux, and Ute tribes.

The money is needed by tribes — which are still waiting for federal Covid-19 relief funds while state and local government payments to other entities have begun — to make up for shuttered casinos, fishing and farming operations and tourism.

Although the federal government recognizes the corporations as tribal governments in some respects, that’s just a band-aid that allows tribes to get much needed help they otherwise cannot get, said Nicole Ducheneaux, who is representing some of the tribes.

“It’s a stopgap effort to make sure that Alaska Natives can get the services they need,” she told Mehta on Friday.

The Treasury Department did not immediately respond to a request for comment.

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