Interview #7 Dave Castillo | CEO of Native Community Capital

Interview #7 Dave Castillo | CEO of Native Community Capital

Interview #7

DAVE CASTILLO | Native Community Capital

The Native CDFI Network (NCN) developed the “Native CDFIs: Difference Makers for Indian Country” interview series to cast a much-needed spotlight on the many positive benefits that Native community development financial institutions (CDFIs) create for tribal communities and the leaders who help make Native CDFIs the transformational success stories they are.

In this latest edition of “Difference Makers,” NCN sits down with Dave Castillo, who serves as CEO of Native Community Capital (NCC), a federally certified Native CDFI that maintains offices in New Mexico and Arizona. In addition to overseeing day-to-day operations, Castillo’s primary role with NCC is to maintain and develop strategic partnerships with banks, public-sector agencies, and CDFI and foundation partners to raise public- and private-sector capital to provide housing and community and economic development financing on tribal lands.

Castillo serves on several boards of directors and advisory councils, including New Mexico Community Capital, the Housing Assistance Council, the New Mexico Tribal Homeownership Coalition, the Federal Home Loan Bank of San Francisco, and Enterprise Bank & Trust.

In this wide-ranging conversation with NCN, Dave shares an overview of NCC’s difference-making work and his admiration for the persistence and ingenuity of Native small business owners. He also issues a challenge to lending institutions to invest in Native CDFIs to advance self-determined “WELL-th” building in Native communities.

NCN: Why do you what you do? How did leading Native Community Capital become your life’s calling?

Castillo: Early in my career, I asked my Indian Country mentors who are elders now in the community to guide my path. They would present issues for me to study and propose solutions for. They asked me to carry on their work and continue forging a path towards better outcomes on issues important to Indian Country. It’s really important to remind ourselves we don’t do this work alone. This can be lonely work, but we’re never truly alone. We have the prayers of our ancestors and we have the support, encouragement, and trust of those who need us to continue this work.

One recent example of carrying on together came from Twila Martin, a former chairwoman of the Turtle Mountain Band of Chippewa. She said, “David, here are contacts I’ve developed over the years in leadership, and now I’m passing them on to you.” I’m so glad she did that. We have been constantly bombarded in this dominant Western culture with messages to the contrary of working together. I’m talking about the ideas of the corporate titan, the tech billionaire. The ego and “greed is good” approach that benefits few, but which typically is really devastating for everyone else, especially Indian Country and everything that is this earth.

Also, as I was growing up, I learned about the hardships my grandmother, my mother, and, as a young newlywed, my mother-in-law had endured. Their stories were so similar. Combined with what my Indian Country mentors were asking me to do, it all clicked. It gave me a clear and consistent picture as to what’s needed and what’s possible. At the end of the day, all of us stand on the shoulders of those who came before us, who struggled to clear the path for the ongoing work we do. For that I’m really grateful, and I have become more and more committed to social and economic justice. So when you hear me railing against some bank executive, that’s where that comes from.

NCN: As you know, there are more than 70 federally certified Native CDFIs across the country and many more “emerging” CDFIs following in their footsteps. Why did Native communities feel it necessary to create CDFIs and what fundamental role do they play?

 Castillo: Native Community Capital formed at the direction of elected tribal leadership. In 2003, the Governor of Arizona and tribal leaders met at the base of Mount Baboquivari at Tohono O’odham. That location holds very special significance for the Tohono O’odham people in relation to making important decisions, so it was appropriate that we were meeting there. They were there to discuss housing and access to capital, and it was there the idea emerged to form a Native-led financial institution to serve Native people residing on tribal lands.

The tribal leaders said, “Why is it that towns right outside the reservation boundaries get access to bank financing, tax credit financing, bond financing and even some sorts of exotic financing options? All we get are government grants.” Another comment I remember was, “The banks are happy to take our payroll and our tribal account deposits and structure financing for our gaming and other enterprises. But when our tribal members call to get a small business loan or we need financing for housing, the banks won’t even pick up the phone.” Ultimately, the tribal leadership wanted parity. They wanted equitable access to capital. Governor [Janet] Napolitano took the position that if banks were not willing to make loans to tribal citizens residing on tribal lands, then tribes themselves should capitalize the fund and show the banks how that work could be done. The tribal leadership agreed and endorsed the creation of the predecessor of Native Community Capital at the time. Over the years, we’ve deployed over $20 million in loaned funds to support tribal housing, community economic development. But the need is still great, and there’s so much work that needs to be done.

NCN: What do policymakers, outside financial institutions, and the general public need to understand about Native CDFIs and the difference they make?

Castillo: They need to recognize we’re not engaged in simple charity work. We need to move the money. We need to get the resources into Indian Country. Our non-profit status is a tax designation – it’s not a business model. We don’t rely exclusively on government grants. Our work and our organization need to be economically self-sufficient, and we need to be good stewards of the debt and equity investments placed in our care. Investors, the general public, and policymakers don’t realize we’re operating in some of the most distressed economic environments. These are places regulated financial institutions fear to tread. If you look at national non-profits that claim to serve all and other supposedly socially minded for-profit organizations, they avoid Indian Country as well. One nationwide non-profit intermediary during the pandemic secured over $1 billion in donations from Fortune 500 companies. Little if any of that reached Indian Country. So where we work, it’s a place beset by predators. We have payday lenders. We have pawnshops and scoundrels of all sorts. For all of the strides tribes have made through self-determination, they’re operating within broken economies. It’s in this environment we do our work – we engage in the R&D [research and development] of what works, and we develop and scale the services that Indian Country needs to rebuild tribal economies.

So when policymakers, investors, and the general public choose to limit their support for our work, it’s a decision to continue starving tribes of the resources needed to recover from the centuries-old conflict with the West. I imagine when the Ukraine crisis ends, the United States and other countries will invest heavily in the Ukrainian people rebuilding on their own terms. Native people should be afforded the same dignity. We’re done with poverty programs. Tribes have done so much with so little for so long. Just imagine if tribes were recognized as the nations they are, with the unique contributions we can offer the world. We need to be able to recover and thrive. We’re doing it anyway, and Native CDFIs in a small way are doing their part.

“We need resources. We don’t need folks to do it for us. We’ll do this work ourselves. Economic development doesn’t happen overnight. If you’re going to truly be a partner with Native CDFIs, then you’re going to have to be a partner for the long haul.”

NCN: Tell me about Native Community Capital. What is its mission, and how does it foster prosperity in the communities it serves?

Castillo: We make home loans and small business loans for Native people on tribal trust lands. It sounds simple enough, but the fact is most lenders avoid serving tribes who want homes or businesses on Indian reservations. Less than 10% of mortgage loans are made on tribal trust lands. Even that amount might be celebrated if not for the fact that the HUD 184 Loan Guarantee Program provides a 100% guarantee to lenders in the case of a mortgage default. And in the case of business loans, the BIA [Bureau of Indian Affairs] offers a 90% guarantee. Yet lenders actively avoid making loans on tribal trust lands. So that’s the work we do. We make these loans almost exclusively on tribal trust land. It seems like it’s been easier to land a rover on Mars than it is for the banking community to open a branch on or near an Indian reservation.

The issue has been and continues to be how can we increase access to safe, decent, and affordable housing for tribal citizens living on tribal lands? I spend most of my time educating foundation, public, and private sector would-be allies on the role they could play in the equation. It’s a privilege to be asked to walk would-be investors through the process of how their investments can be transformational, and we invite the curious and the committed alike. We value and appreciate those that make commitments to help rebuild Indian Country, but we need many more.

NCN: Native Community Capital supports tribal citizens from all walks of life in various ways. Can you share with us an inspiring success story of an individual client you have worked with?

Castillo: I have so much appreciation for Native small business owners. They are solving problems every single day, and COVID has proven to be the ultimate test. Most small businesses fail within the first three years, and that’s under normal circumstances. You add to that the reality of COVID. But I’m happy to say that every one of our small business borrowers except one is still in business and the one that failed, he has pivoted to his next business with the lessons from the school of hard knocks, arming him for his next set of challenges.

Just yesterday I received an email from a small business client. It says, “Thanks for your support. The relationship between our business and your lending partners has been positive since inception, and we thank you for being a part of this connection. The chief credit officer over there and I have a mutual respect that has developed while he has guided himself and his team to better understand Native American business development issues and the bureaucratic maze we are strapped to follow. It has been an eye-opening experience for them as we held each other’s hands. The chief credit officer has truly learned a lot from me and become an advocate for us. We’ve become their success story. My family and I are committed to making this company successful and a positive contributor within our community. I want you to continue to be in our corner.”

What amazes me about Native entrepreneurs is they just keep going. We’re just providing the resources, the cash to do it. They’re the ones doing the hard work.

NCN: From your perspective, what do Native CDFIs need to realize their full potential? What support do they need to achieve their missions and maximize their impact?

Founder Tudor Montague (Quechan Nation) of Spirit Mountain Roasting, a Native Community Capital client. (Courtesy: Native Community Capital)

Castillo: We need resources. We don’t need folks to do it for us. We’ll do this work ourselves. Economic development doesn’t happen overnight. If you’re going to truly be a partner with Native CDFIs, then you’re going to have to be a partner for the long haul. We need to challenge those entities that to date have failed to adequately serve our communities and instead simply champion corporate PR goals, which often are the same as their CRA [Community Reinvestment Act] goals. That challenge is very simple. I would ask those organizations to lead, and I’m talking about financially. At a minimum, become a preferred lender in the Bureau of Indian Affairs Loan Guarantee Program and become an approved lender in the HUD 184 Indian Loan Guarantee Program. That work would require the lender to commit resources to recruit and retain talent and to achieve loan production goals that have measurable impacts in tribal communities. That’s the big ask. We’ve not seen banks that can do that. As a matter of fact, they’ve retreated. They’ve dismantled their Native lending teams.

If you’re not going to lead, then follow. What does that mean? Well, if you’re not willing to become a preferred or approved lender, then commit cash resources to Native CDFIs that are actively and typically exclusively serving Native people and communities who are eligible for the loan products that are paired with guarantees or credit enhancements.

If you can’t do either of those things – which some financial institutions and others have proven they’re not going to do – then get out of the way. Stop using Native American imagery. Don’t use it on your websites. Don’t use it in social media. Stop making statements that your organization serves all communities in your service territory. If you have no intention of doing so equitably, be prepared to suffer the CRA and public relations consequences, period.

The ask from our community and our allies is to help us promote wealth building. But I don’t spell wealth building “w-e-a-l-t-h.” I spell it “WELL-th.” We’re talking about community wellbeing, social and economic wellbeing. The biggest danger for us is the idea that money is going to solve our problems. It won’t. Us acting together, as tribes always have, and honoring the kinship and clan relationships that define who we are as tribes, that’s where the solution lies. The funds we deploy, they’re just a tool. But the love we have for our communities is what’s going to help us conquer the vice and despair that remains in our communities. It can also help us resolve the apathy and defeat the predatory intentions of those outside our communities. That’s a big ask. There’s no silver bullet. That’s not how it works. We need to do the hard work and face the many demons and internal struggles and work through them.

To learn more about Native Community Capital, please click here.

Interview #6 Tawney Brunsch | Lakota Funds

Interview #6 Tawney Brunsch | Lakota Funds

Interview #6

TAWNEY BRUNSCH | Lakota Funds

 

The Native CDFI Network (NCN) developed the “Native CDFIs: Difference Makers for Indian Country” interview series to cast a much-needed spotlight on the many positive benefits that Native community development financial institutions (CDFIs) create for tribal communities and the leaders who help make Native CDFIs the transformational success stories they are.

In this latest edition of “Difference Makers,” NCN sits down with Tawney Brunsch, who serves as the Executive Director of Lakota Funds, a federally certified Native CDFI serving the Pine Ridge Reservation and other Native communities in South Dakota. Prior to joining Lakota Funds in 2008, Tawney worked with the Black Hills Federal Credit Union for eight years. At Lakota Funds, Tawney has successfully led Lakota Funds’ achievement of key organizational benchmarks, including chartering Lakota Federal Credit Union, expanding Lakota Funds’ lending area to the Rosebud Reservation, becoming a Farm Service Agency Guaranteed lender, and launching the Child Development Account (CDA) program, one of the first such programs in Indian Country.

A member of the Oglala Sioux Tribe, Tawney is nationally known for her community development efforts and serves on several boards and advisory committees, including the Native CDFI Network’s Policy Committee, the Federal Home Loan Bank of Des Moines Advisory Council, and the Community Advisory Council of the Federal Reserve Board.

In this wide-ranging conversation with NCN, Tawney shares Lakota Funds’ nearly four-decade track record of helping to grow the Pine Ridge economy through homeownership, small business lending, financial literacy, and other wealth-building initiatives.

NCN: Why do you what you do? How did leading Lakota Funds become your life’s calling?

Brunsch: The answer to your question is simple – the universe guided me here. I was very happy at Black Hills Federal Credit Union, one of the biggest credit unions in the nation. I loved their philosophy – members helping members. We were doing the types of loans that nobody else wanted to do. It was very mission-driven work, which I loved. And lo and behold, out of the blue, Dowell Caselli-Smith, who was the director of Lakota Funds at that time, called me and said, “How would you feel about moving back home and putting that economics degree to work?” And I am thinking, “What? Why?” Ultimately, I did it because it was an opportunity to move back home. While I didn’t even understand what a CDFI was at the time, it was perfect to practice some of the things you learn in theory about economics and also to have an opportunity to make some institutional changes that are not only impacting our community right now but will continue to have those impacts on future generations. It was meant to be.

NCN: As you know, there are more than 70 federally certified Native CDFIs across the country and many more “emerging” CDFIs following in their footsteps. Why did Native communities feel it necessary to create CDFIs, and what fundamental role do they play?

Brunsch: Native CDFIs are critical in growing economies in the Native communities we serve. Coming from heavily regulated institutions like Black Hills Federal Credit Union, where you have to do everything within certain guidelines, I understand how restrictive that can be. CDFIs were created by Treasury for the purpose of creating programs, loan products, and those models that fit that community. That’s critical because our borrowers are not comfortable with traditional lending and have a kind of deserved mistrust of federal government and federal agencies. They’re going to be resistant to it. The fact we are a Native organization – and especially with Lakota Funds being tribally chartered – there’s a built-in level of comfort. Because we are also led by tribal members who are from this community, Lakota Funds has really been able to optimize that model of Native CDFIs to the max. We’re using what we know of the community to create the loan products that fit them, to create that technical assistance, the classes, the delivery, and the outreach that fits this community best. We’re doing that because we can as a Native CDFI and we’re doing it better because we’re local, because we are tribal members ourselves. Six of Lakota Funds’ seven board members are not only tribal members but tribal members from Pine Ridge.

NCN: Following up on that, Lakota Funds also filled a significant void at Pine Ridge, which has had few local lending institutions to speak of, did it not?

Brunsch: The credit union was the first bank to be located on the reservation. So for Lakota Funds, it’s proximity. It’s relationships. It’s the fact we are a tribal charter. But it’s also that we’re meeting our clients where they are. We know there’s going to be a certain amount of education needed even in our vocabulary – that we’re using words that are easily understood when you’re talking about equity and you’re working with a population that is 60 percent unbanked. You have to be careful how you’re defining your products and talking about them in the communities. It’s making sure we’re communicating effectively and knowing that trust land prevents our borrowers from meeting any loan to value, where you don’t have that as an asset to be able to secure the loan. We know it’s something that’s going to be harder to do here, so none of our products require the types of ratios that bank loans do. So it’s knowing it, living it, and then applying it to your loan products.

NCN: Isn’t part of it, too, the folks there at Pine Ridge having much greater confidence in Lakota Funds having their best interests at heart, as opposed to those traditional lenders that have their own best interests at heart?

Brunsch: Absolutely. The fact we’re a nonprofit, we are mission driven, and it’s not just about a bottom line. It’s not just about generating profit for the institution. We’re 36 years old. Even though generating a profit will never be our top priority, we are realizing if we want to be around to serve the next generations that we do have to be more mindful of self-sufficiency and not always be grant reliant. We are more aware of that and careful that our interest rates, our earned income is eventually going to be sufficient enough to cover our operating costs and allow us to continue serving this market. Our self-sufficiency ratio was 30-some percent 10-12 years ago, and now we’re up to nearly 50 percent. I feel strongly about making sure Lakota Funds is around to continue this work, and that is done by achieving a certain level of self-sufficiency.

NCN: What do policymakers and the general public need to understand about Native CDFIs and the difference they make?

Brunsch: It’s the fact we’re doing the loans that nobody else wants to do, and the fact we’re serving an area where there are no other institutions to even reach out to to consider those loans. What I’ve been bragging about lately is not only is Lakota Funds increasing its loan volume – which I think demonstrates the success of Native CDFIs in general – but our deployment has doubled in the last three years. Last year, we did $5 million in loans very efficiently. I had one-and-a-half lenders. There’s only five staff. We’re serving two reservations that cover more than 5,000 square miles. We assisted 100 clients last year with business loans. We have less than a one percent delinquency rate, 0.6 percent. These are loans that are being repaid.

The other thing is Lakota Funds now is also the fiscal agent for the South Dakota Native Homeownership Coalition, which is a statewide coalition that is working to increase the number of Native families who are achieving homeownership. In 2020, 70 percent of the home loans that were done in Indian Country were done by Native CDFIs. Home ownership is increasing because of Native CDFIs. Business lending is increasing because of Native CDFIs. Consumer lending is increasing because of Native CDFIs. All of Indian Country would benefit if everyone had a Native CDFI in their community, but, unfortunately, they do not. But we have an increasing number of them, which shows that the word is out.

NCN: Tell me about Lakota Funds. What is its mission, and how does it work to foster prosperity in the communities it serves?

Brunsch: Lakota Fund’s mission is to promote economic sustainability on the Pine Ridge Reservation and geographic service area through business loans, technical assistance, and wealth-building education for families and businesses. We are one of the few institutions that are offering our tribal members direct access to credit for business loans. Outside of the tribe, we are the only ones who are contributing to the businesses that drive the economy. The bigger part of it is technical assistance and wealth building. Wealth building includes a lot more than just business lending. It includes home ownership. As a HUD-certified housing counseling agency, Lakota Funds is partnering with Lakota Federal Credit Union, which does the mortgages. Lakota Funds does the heavy lifting in some ways, and that is getting our families ready for homeownership. That’s through the technical assistance, the teaching of classes, the financial literacy, the homebuyer readiness – all of the things that go into making sure they understand what owning their own home can mean. Once they’ve got their homes bought, are they more likely to participate in our child development account, the matched savings accounts that are used to pay for a secondary education for kids? Are they more likely to feel comfortable pursuing that dream of owning their own business? Absolutely. It’s all tied together, and Lakota Funds as a Native CDFI can offer all of these things under one roof.

NCN: Can you talk about how the private-sector economy – businesses owned and operated by tribal citizens – has grown at Pine Ridge, and Lakota Funds’ role in cultivating that growth?

“In the last two years, our [small business] borrowers have seen an increase in their incomes of just over 30 percent…They’re also some of our biggest employers.”

Brunsch: When you’re driving through Kyle or Pine Ridge, there’s a noticeable difference in the businesses that are visible. But unfortunately, most of our communities lack the infrastructure. We don’t have the streets, curbs, gutters, access to water and sewer, and the store fronts. So we don’t necessarily see many more of those businesses. But for the most part, Lakota Funds’ loans are to the businesses that don’t need those storefronts. Just over half of our portfolio now is to our ranchers, our livestock producers. So you’ve got a business that is supporting two or three families and is very likely to be passed on to future generations. Is it a store front? No. Is it generating income that’s going to support the growth of the economy? Absolutely. In the last two years, our borrowers have seen an increase in their incomes of just over 30 percent. The other big portion of our portfolio is our construction contractors and related businesses. These are individuals who are building homes or structures. They’re doing very well. They’re also some of our biggest employers.

Another thing I wanted to brag about is we’re increasing credit scores. Low credit scores is a big initial barrier to accessing credit in traditional forms. Being a Native CDFI, just because you have a 599 credit score doesn’t mean you’re going to be disqualified from getting a business loan. It means we’re going to work with you. With the good repayment rates we’re seeing, now those individual scores are increasing. They’re going to be more bankable and ready for that next level of financing.

Tawney Brunsch with Artspace President Kelley Lindquist and First Peoples Fund President Lori Pourier at the groundbreaking of Oglala Lakota Artspace, which provides studio and commercial space to local Native artists (September 2018) (Courtesy: Artspace)

NCN: Lakota Funds has helped an extraordinary number of people. Is there an individual’s client success story that really sticks out to you, that really inspires you?

Brunsch: I would say my experience with Carol Two Crow, who was an elder living in Lakota Funds’ LIHTC [Low-Income Housing Tax Credit Program] housing. She was lucky enough to live with three of her adult children and her grandkids in the same house. So when Eagle Nest Housing became free from the LIHTC restrictions and we were able to offer those homes as homeownership opportunities, the whole community was a little resistant at first to taking that next step. Instead of being excited about being able to own their own home, their first question was, “Who will come over and fix the furnace?” So it was fear, and I came to understand how we were going to have to frame this differently because an asset on a balance sheet doesn’t mean much to them. In a conversation I had with Carol, she said, “I feel like I should do this, but I’m not quite sure.” She was unsure of taking the leap to borrow $60,000 to buy her home and make the renovations. I said, “Carol, it would mean being able to take care of your family for generations.” Even after she was gone, she would be at peace knowing her grandkids would have a place to live. With that, she understood and went wholeheartedly forward.

NCN: From your perspective, what do Native CDFIs like yours need to realize their full potential? What support do they need to achieve their missions and maximize their impact?

Brunsch: We need bigger NACA [Native American CDFI Assistance] awards from the Department of Treasury. I’m sorry to sound that way, but honestly, our loan volume is growing. Our Native CDFIs are growing. It’s time that we have a grant that meets those needs. I also want to see a Native set-aside on the bond program because there are a group of us more mature Native CDFIs and even some that are emerging that want to partner to apply for a bond. We’re there. We’re ready. The lack of loan capital always holds us back. I shouldn’t have to stop everything I’m doing and start shaking trees for more money because I don’t have access to investment or the types of loan capital I need for lending. It shouldn’t be that way. We need steady, consistent, low-cost access to capital. We need more investment.

To learn more about Lakota Funds, please click here.

Interview #5 Jeff Johnson | Wisconsin Native Loan Fund

Interview #5 Jeff Johnson | Wisconsin Native Loan Fund

Interview #5

JEFF JOHNSON | Wisconsin Native Loan Fund

 

The Native CDFI Network (NCN) developed the “Native CDFIs: Difference Makers for Indian Country” interview series to cast a much-needed spotlight on the many positive benefits that Native community development financial institutions (CDFIs) create for tribal communities and the leaders who help make Native CDFIs the transformational success stories they are.

In this latest edition of “Difference Makers,” NCN sits down with Jeff Johnson, who serves as Interim CEO and Board Chairman of the Wisconsin Native Loan Fund (WINLF), a Native CDFI located in Lac du Flambeau, Wisconsin that serves Native people statewide. WINLF is a revolving loan fund that supports the renovations of distressed homes for people in need, provides down-payment assistance and debt consolidation loans for its clients, and offers small business loans to area Native entrepreneurs.

An enrolled member of the Forest County Potawatomi tribe, Johnson also is the President/Principal Engineer of J.W. Johnson & Associates, which provides professional civil engineering and construction management services.

In this wide-ranging interview with NCN, Jeff shares how he brought his extensive experience as a small business owner into his leadership role, and how WINLF is growing to address the homeownership, small business, and related needs and goals of the tribal communities it serves.

NCN: So let’s start with you: Why do you what you do? How did you end up leading the Wisconsin Native Loan Fund?

Johnson: First off, thank you for the opportunity to share. My interest in leading the organization was a little bit by accident, to be honest with you. I was asked to join WINLF’s Board of Directors in 2013. I’m a civil engineer and construction project manager by trade with 26 years of experience. I own my own small business, soI was familiar with the capital needs and the management of a small business. I have stayed on the board because I like the work that we do and I have a soft spot for economic development and for tribal communities. I feel good about being able to serve those communities and utilize my skill set at the same time. So when Fern Orie, the founding CEO of WINLF, announced she was going to leave, as one of the most tenured Board members, I offered to step into the CEO role, at least on a temporary basis. And then that just snowballed into me taking on the role as Interim CEO. I still have the passion for helping tribal communities and I love that kind of economic development problem set. It’s different from engineering. It’s different from construction project management. I made a decision to switch careers, and that felt good. It felt like I was reinventing myself. Several months later, it feels like I am on the right path.

NCN: As you know, there are more than 70 federally certified Native CDFIs across the country and many more “emerging” CDFIs following in their footsteps. Why did Native communities feel it necessary to create CDFIs, and what fundamental role do they play?

Johnson: I think it’s pretty simple – it’s access to capital for individuals to provide them with financing and help them build their credit. And it’s doing so without predatory lending practices. That’s from the individual’s standpoint. Overall, CDFIs play a role in the economic development landscape for tribal communities and to me, it’s more organic economic development because it helps small business owners, it helps homeowners, it helps build all of these organically grown ways of developing and increasing the understanding of finances in all of the communities that we serve.

NCN: You mentioned the role Native CDFIs play in helping to organically develop tribal economies. Shouldn’t Native CDFIs be viewed as co-equal partners with tribal governments and other entities within a tribal community for making economic development happen and grow over time?

Johnson: I couldn’t agree more. Economic development starts with relationships and tribal relationships with partners is crucial to disseminate information and gain access to funding. To help us do that, Wisconsin Native Loan Fund has a very unique model in that our board has one member from every tribe that we serve. That’s the internal accountability – that we hold ourselves to that standard. If we want to serve each market well, then we need to have a voice in each community.

In addition to that, Wisconsin Native Loan Fund is part of the Wisconsin Indigenous Economic Development Corporation (WIEDC), which is made up of the four Native CDFIs in the state of Wisconsin: WINLF, NiiJii Capital Partners, First Nations Community Financial, and First American Capital Corporation. By banding together, the intent is scalability and to go after larger projects that will build larger businesses, serve larger loans, and then spread that liability across all four of our organizations instead of just one. We’re trying to grow WIEDC and be smart about it while mitigating our risk as much as possible.

NCN: What do policymakers and the general public need to understand about Native CDFIs and the difference they make?

Johnson: When I have a three-minute elevator pitch to give to outsiders, I emphasize the fact that CDFIs are eligible to be stakeholders in the value chain that is real estate development, that is economic development in tribal communities. We’re building organically from the ground up business owners and we’re trying to encourage that entrepreneurial spirit. By encouraging more entrepreneurship, you will be able to have more lending partners later on, as well as more lending clients. The same idea with homeownership. Homeowners will need to have a vehicle so we could offer them a consumer loan for a vehicle or a home improvement loan. CDFIs have a stakeholder seat at the table in that value chain. I think it’s about scalability, too.

NCN: Tell me about your Native CDFI, Wisconsin Native Loan Fund. What is its mission, and how does it work to foster prosperity in the communities it serves?

Johnson: Our mission is to simply increase the financial self-sufficiency of Native communities in Wisconsin. We do that through a couple of different ways: education and technical assistance, and that access to affordable capital. We’re not a predatory lender. We’re not going to have exorbitant interest rates. Also, the message that needs to be told is that we’re not a handout. It’s not a grant. It’s actually a loan. WINLF is providing a hand-up, not a hand-out in our approach. You walk in our door, if you have a 400 or 500 credit score, we’re going to be able to get you into a loan, but there may be a caveat that goes along with that. You might have to go to financial literacy classes on home buyer education, credit building, or estate planning or even the small business classes that we provide. That TA [technical assistance] that we’re offering goes hand in hand with the dollars that we provide. We have a very strategic approach – we provide access to affordable capital and we’re providing financial education and asset-building services. We’re increasing our clients’ self-sufficiency and improving the economic and social conditions of the communities that we serve.

NCN: A recent news article about WINLF mentioned that the delinquency rates on its loans are lower than most banks and lending institutions. How would you explain WINLF outperforming other lenders in this regard?

“It’s knowing who we’re selling to and then making sure our attention and technical assistance is appropriately directed toward them. That benefits them to the point where they’re inspired, and they want to pay us back.”

Johnson: It boils down to relationships. It’s about getting to know our clients and their experience while improving the customer experience. It’s knowing who we’re selling to and then making sure our attention and technical assistance is appropriately directed toward them. That benefits them to the point where they’re inspired, and they want to pay us back. That’s why it boils down to relationships. We try to help absolutely every single person that walks in the door. We try in some fashion to give them some financial literacy help. In essence, a relationship-based arrangement is what it is.

NCN: WINLF has a heavy focus on homeownership and your CDFI recently achieved formal HUD [U.S. Department of Housing and Urban Development] certification as a housing counseling agency for its work in homeownership with pre-purchase and post-purchase training, foreclosure prevention, and assisting families to qualify for mortgages and refinances. Can you talk about why WINLF went that route, what it’s empowered you to do, and how it’s benefiting the community and the CDFI itself?

Johnson: Forest County Potawatomi, for example, hasn’t been a HUD lender or hasn’t had HUD dollars in the door for the last 10 years. This is an opportunity gap that exists among the various tribal governments and tribal communities that we serve. WINLF stays abreast of the housing rules. We’re trying to ultimately get everyone into home ownership. Being a HUD counselor is a priority for us. We have two people that are certified to be counselors, and we are looking at getting another individual certified as well. HUD sponsors these individuals to provide mortgage counseling to avoid default as well as provide options for a pending default. It serves our mission, it serves our purpose very well.

NCN: Your CDFI supports tribal citizens from all walks of life in various ways. Can you share with us an inspiring success story of an individual client you work or have worked with?

Johnson: Amy and Cale Hacker live in Oneida, Wisconsin, and they own a company called White Buffalo Trucking (WBT). About a year and a half ago, they borrowed a sizable business loan to build a shop for their trucking business. They own three or four dump trucks and they’ve had some success doing state DOT [Department of Transportation] work and they wanted to expand. They didn’t have quite the squeaky-clean credit or history that a bank would need to give them a rubber stamp approval. If they were a rubber stamp, then they wouldn’t have needed to come to us. But they did. I’ve known Amy and Cale for probably 10 years. WINLF provided WBT a small business loan to build a new truck shop and they put a lot of sweat equity into building their new structure. The shop is almost completed and honestly, their business has blown up. Their business has really improved because now they have their own shop where they can service their dump trucks and they’re able to perform all of the maintenance work on their trucks themselves. Before, they were working out of their basement or out of their garage, which is kind of limited for a commercial operation. I’ve just been totally blown away with how well and how far they’ve taken those dollars and made them stretch.

NCN: The Native CDFI Network published a report last year documenting the extraordinary difference that Native CDFIs have made in helping Indian Country respond to – and recover from – COVID-19 pandemic. How has your CDFI supported the communities it serves through the pandemic?

Johnson: All the while during COVID, WINLF was open for business. We stayed engaged and we were in contact with our clients. We relaxed some repayment requirements or deferred them during COVID, too. But we stayed engaged. We stayed in contact with all of our clients and had weekly conversations with them so that we could anticipate any defaults. We also offered small loans for alleviating the burden during COVID. And we pushed out the repayment time so they could get back to work and pay that obligation off later. So we tried to work with the community.

Amy Hacker, Co-Owner of White Buffalo Trucking, LLC (Courtesy: White Buffalo Trucking, LLC)

NCN: From your perspective, what do Native CDFIs like yours need to realize their full potential? What support do they need to achieve their missions and maximize their impact?

Johnson: Native CDFIs need to work to become larger in order to scale up. You need to have that to create economic development on a larger scale for Native communities. We know the history of how the process works, even with real estate development work. This is an area where CDFIs can move further down the value chain. If there’s an infrastructure development or a business that wants to expand or even come on to trust land, it would be helpful to have CDFIs at the table for our expertise because we know how to fill it up with tenants after the development has been created. I think that it’s important that we make CDFIs integral in the economic development value chain.

One last thing I think is important: WINLF’s self-sufficiency ratio has been above 40 percent for the last five years. It hasn’t dipped below 40 percent, which is the minimum prudent standard for the U.S. Treasury. The point is that we’re working towards complete self-sufficiency, and that we can get enough earned income in the door annually to sustain us so we won’t be so dependent on grant monies. The goal is to be self-sufficient and no longer have to rely on the federal government.

To learn more about the Wisconsin Native Loan Fund, please click here.

Interview #4 Jonelle Yearout | Nimiipuu Fund

Interview #4 Jonelle Yearout | Nimiipuu Fund

Interview #4

JONELLE YEAROUT | Nimiipuu Fund

 

The Native CDFI Network (NCN) developed the “Native CDFIs: Difference Makers for Indian Country” interview series to cast a much-needed spotlight on the many positive benefits that Native community development financial institutions (CDFIs) create for tribal communities and the leaders who help make Native CDFIs the transformational success stories they are.

Jonelle Yearout

In this latest edition of “Difference Makers,” NCN sits down with Jonelle Yearout, who is Executive Director of Nimiipuu Fund, a federally certified Native CDFI that serves the Nez Perce Reservation and traditional territories of Nez Perce in Idaho, Oregon, and Washington. Jonelle also was recently appointed Northwest Regional Delegate on NCN’s Policy Committee.

An enrolled member of the Nez Perce Tribe, Yearout is passionate about solving challenging social and economic issues for the Nez Perce Tribe, her fellow tribal members, and surrounding rural communities. Her mission-driven focus is on delivering innovative products and services that raise up her people’s voice and enable them to create a brighter future.

In this wide-ranging conversation with NCN, Yearout shares her personal journey and how it has shaped her approach to growing Nimiipuu Fund’s ability to holistically support the community members it serves.

NCN: Why do you what you do? How did you come to lead the Nimiipuu Fund?

Yearout: Back in 2013, I saw that the Nez Perce Tribe was developing a CDFI and advertising for the Executive Director position. Like a lot of other people, I thought, “What’s a CDFI and how is it going to help?” Again in 2015, the Executive Director position was advertised. I was in graduate school at the time studying Urban & Regional Planning, where we reviewed models for economic development that included Native CDFIs. My aunt Lilly Kauffman, who studied Native CDFIs, was one of the founding members of Nimiipuu Fund. She shared with me stories of powerhouse women like Eloise Cobell and Tanya Fiddler, formerly of the Native CDFI Network. She said to me, “I know you’re in school, I know you’re busy, but I think you need to apply for this job.” When your Aunty or an elder tells you something, you listen. My personal life was full at that time as a single mother attending graduate school and separating myself from domestic violence. I didn’t feel that I was a model candidate for this position. However, I was raised to find what you love to do, but that you are also of service – to your family, community, natural resources, and the future generations.

When I came on with Nimiipuu in December 2016, I was just trying to figure out up from down. How do I underwrite a loan? Or become a “banker” as our clients liked to say. My background included family advocacy, research, accounting, and leadership, which helped me in my new role. As a lifelong member of the community, I understood cycles of poverty, violence, addiction, and codependency – all of those things that are part of historical trauma. Everybody deserves a chance, right? As a mother and a tribal woman, I took all of that in and I wanted to nurture Nimiipuu so we can recreate and take control of our tribal economy.

NCN: As you know, there are more than 70 federally certified Native CDFIs across the country and many more “emerging” CDFIs following in their footsteps. Why did tribal nations and communities feel it necessary to create CDFIs, and what fundamental role do they play?

Yearout: We’re the only certified Native CDFI in Idaho. It’s an expression of sovereignty. It’s doing for your own and taking that risk to express how you will create your own economy. It’s also the importance of accessing credit for individuals, for businesses, for homeowners to get a loan on trust land. If you think about federal policy historically, our wealth was taken from us. Tribes are wanting to take that back, and a financial institution is part of the solution. How can we do this for ourselves?

Another important point is our industry works together. We provide one another a helping hand. There’s those established Native CDFIs that are willing to help out, like, “Here’s a copy of a memo. Here’s some sample policies, and this is how I did it.” Paying that forward is so valuable and that’s what I’ve done.

NCN: What do policymakers and the general public need to understand about Native CDFIs and the difference they make?

Yearout: It’s just the acronym, you know, the alphabet soup for “CDFI” or “community development financial institution.” We are a financial institution serving Native communities that have had resources and opportunity stripped from them. Are you able to walk or get into your car to drive to a bank? Our tribal members get the predatory loan letters every day. They come to their mailbox. There’s more than 20 predatory lenders in the nearest border town. That’s fast, easy capital, but risky. But you know what? We’re trying to take that back and provide the financial education, give our people the tools so they can build their financial capabilities. We provide safe and affordable capital that is not predatory. We are the same as our community members. We are from the community. So we want to see the betterment of that. We’re building from the individual to the family to the business owner to the homeowner. We’re building those things to help us thrive. Other tribes are following a similar path by developing their own Native CDFIs. Policymakers need to see the demand in Indian Country and throw more dollars into the Native initiatives at the U.S. Treasury and CDFI Fund. Native CDFIs have proven to be effective.

NCN: Tell us about the Nimiipuu Fund. What is its mission, and how does it work to foster prosperity in the communities it serves?

Yearout: Nimiipuu Fund was established in 2013 and we were federally certified in 2018. Our strategic vision is focused on enhancing the personal entrepreneurial capacity of the Nez Perce Reservation and surrounding communities. We promote economic growth while embracing our cultural values and traditions by providing tailored financial products and services. We tailor those products and services based on the needs of the community. So, on the consumer side, that means debt reduction, coaching, credit building loans – those sort of things – to get them ready if they want to buy a home or start a business. Our consumer loans are the largest part of our portfolio. But we are doing business lending and we’ve done a couple of participation loans, too. Soon we will start home improvement lending. We want to break the cycles of poverty. I started out as a person of one running this operation, and now we have four full-time employees based on the growth and the need. We’re growing and we’re keeping our finger on the pulse on the market. Again, it comes down to our vision of self-determination and sovereignty.

“We’re supporting the businesses that provide jobs and help people sustain themselves, because not everybody’s going to be working for the tribal government.”

NCN: You mentioned earlier that prior to CDFIs being created, wealth was just leaving the reservations largely because of federal policies. Can you talk about the role that CDFIs play in cultivating a private sector economy on reservations that helps keep the wealth local and re-establish what once were vibrant, thriving systems of local, tribal commerce? How is that unfolding at Nez Perce?

Yearout: With federal programs and the reliance on programs, you’re relying on that system that has failed you from cradle to grave. With my parents as former tribal politicians, it’s a puzzle they all try to solve and they want to look generations ahead where things are going to be sustainable for our people, resources, and lands. Our tribal economy is not something that’s new. We’ve been here, based on the archeological record, for 17,000 years or more. We had our own economic systems, we had trade routes, we had fishing, we had bartering. Nimiipuu’s logo is based on the dentalium shell, a form of money. So that’s not foreign to us. So what we’re doing is getting that capital and then we’re hustling. I say that as single moms, we can hustle. So I’m going to hustle, right? And we’re going to tell our story. We’re going to get these funds. We’re going to help these people. And guess what? Those funds, they just they revolve back and that’s what we tell our clients. When you pay it back, it’s going to go out to somebody else. We’re taking the power back. We’re supporting the businesses that provide jobs and help people sustain themselves, because not everybody’s going to be working for the tribal government. They’re doing something they’re passionate about. They’re artists, weavers, fishermen, they raise cattle. They’re providing for their families that way.

The Nimiipuu Fund’s 2021 Holiday Native Artist Popup Shop. Pictured is Wetalu “Lulu” Henry, owner of Nchi.wana. (Courtesy: Nimiipuu Fund)

NCN: With the Nez Perce Tribe’s creation of Nimiipuu, there was a long-term plan for establishing the Fund, letting it get its legs under it, growing its capacity, growing its know-how, and then allowing it to walk on its own and gain a greater measure of independence. What is the plan for growing Nimiipuu and its ability to positively impact the community?

Yearout: We developed a strategic plan in early 2020, and this was right before the pandemic hit and everything shut down. The thing about it is we found that demand increased during the pandemic because people were scrambling and trying to figure out what to do. It really demonstrated the need for a CDFI in the community for helping people and helping small businesses. It did grow that awareness. It’s really the word on the street in how you talk to people and treat people.

In the work that we do, we are showing we’re needed and we’re viable. We will continue to grow our staff, add loan products, respond to our community’s needs, create more success stories, and promote sovereignty.

NCN: Your CDFI supports tribal citizens from all walks of life in various ways. Can you share with us an inspiring success story of an individual client you work or have worked with?

Yearout: My sister went through addiction and recovery and graduated from a center in Portland and she was moving home. A lot of people when they go through that addiction and recovery, there’s no community resource to really welcome them back. She brought back a curriculum called “Wellbriety” by White Bison. In discussion with her and some of the participants of her group that are facing addiction, they are going through those steps of recovery and making amends to their families, to those that they’ve hurt. They’re coming back to the circle, they’re coming back to the tribe. With the CDFI, there’s also the financial wellness component of that. They have court fees, they have debt, they’re separated from their children. They have all these different barriers to get back to a normal life. Some people have thousands of dollars of court fees. So we were working with one client and my sister convinced her to come talk to us. We did a piggybank event with the local head start and she brought her kids. She talked to me about her situation and found she had long distrusted money. As we got to talk more, she gave us permission to work with her advocate and different tribal programs. As part of addressing her barriers, we were able to do the coaching and some of the financial education components. She then became eligible for one of our consumer credit builder loans. We were able to work with our tribal housing to get her a home. She then graduated to other loan products. In continuing her financial education, we do check-ins with her. That’s just a story of someone re-emerging and re-entering the community and trying to make amends. And she’s thriving. These are the impacts we are realizing – it fuels us to continue doing our work.

NCN: Last question: From your perspective, what do Native CDFIs like yours need to realize their full potential? What support do they need to achieve their missions and maximize their impact?

Yearout: It’s a labor of love. Our team members and board know that. They work long hours to get our clients loan ready. It’s a lot of work that you put into an organization to help your community because you have the heart for the community. Native CDFIs are a very small but also a very mighty sector of the financial industry. It’s really understanding those financial markets and the need to raise capital. There was a time where it took the Tribe a lot of convincing to provide us grant capital to get that certification. Graduating from that, it’s having to prove ourselves through grant applications and with investors. A lot of it is about networking and relationship building. When potential investors ask how they can support us, we talk about low-cost capital and general operating support because the volume and number of loan requests we receive is far beyond what’s available. All of us Native CDFIs have so much room and reason to grow. Invest in us in some way or form.

To learn more about Nimiipuu Fund, please click here.

 

Interview #3 Russ Seagle | CEO of The Sequoyah Fund, Inc.

Interview #3 Russ Seagle | CEO of The Sequoyah Fund, Inc.

Interview #3

RUSS SEAGLE | The Sequoyah Fund, Inc.

 

The Native CDFI Network (NCN) developed the “Native CDFIs: Difference Makers for Indian Country” interview series to cast a much-needed spotlight on the many positive benefits that Native community development financial institutions (CDFIs) create for tribal communities and the leaders who help make Native CDFIs the transformational success stories they are.

Russ Seagle

In this latest edition of “Difference Makers,” NCN sits down with Russ Seagle, who has served since 2013 as CEO of The Sequoyah Fund, Inc., a Native CDFI serving the Eastern Band of Cherokee Indians and surrounding rural communities in Western North Carolina. The Sequoyah Fund provides small business start-up and expansion capital, housing rehab loans, credit builder loans, and training and consulting services to small businesses, nonprofits, and tribal departments.

Prior to joining The Sequoyah Fund, Russ owned several businesses. He has been a small business consultant, trainer, and professional speaker since 1999.

In this wide-ranging conversation with NCN, Russ provides an overview of Sequoyah Fund’s comprehensive development of a small business sector across the Eastern Band of Cherokee community, and how the CDFI helped its clients withstand and recover from the COVID-19 pandemic.

NCN: Let’s start with you: Why do you what you do? How did you come to lead Sequoyah Fund?

Seagle: I was doing some programming with the local community college on behalf of Sequoyah Fund. One day my predecessor said, “Wouldn’t it just be easier if you were working for us?” I thought she was kidding and said, “Well, make me an offer I can’t refuse.” At our next meeting, she made me an offer that was pretty unrefusable. I don’t know that anybody in their childhood says, “I want to grow up to lead a CDFI someday,” but we know what we’re good at. We know when we’re good at helping people and we know when we find a good match for that skill set. I did. It’s been a great place to surround myself with people as committed to helping small businesses grow as I am.

NCN: As you know, there are roughly 70 federally certified Native CDFIs across the country, and many more “emerging” Native CDFIs following in their footsteps. From your perspective, why are Native CDFIs necessary, and what fundamental role do they play?

Seagle: All anybody needs to do is look around at Native communities. You don’t see banks popping up or traditional capital flowing into these areas. Native CDFIs fill a vital role. I think about that John Muir quote, “The mountains are calling and I must go.” Well, here in Cherokee, the mountains are calling, and there’s a sense of place that holds us here, draws people back here. People who stay or move back to Cherokee want the same opportunities they otherwise would have to go elsewhere to find. CDFIs are the fuel for that. We make it possible for people to stay near and take care of their families, build businesses, do what they love, and improve their own financial conditions and those of the people around them.

“We make it possible for people to stay near and take care of their families, build businesses, do what they love, and improve their own financial conditions and those of the people around them.”

NCN: What do policymakers and the general public need to understand about Native CDFIs and the difference they make?

Seagle: I think policymakers in general don’t fully understand what value we bring to the community. We’re a very small fish in a very big pond when it comes to pumping government money into communities. We as an industry were not supposed to last forever. We were just supposed to be the mechanism that brings capital into these communities and then attracts banks and other capital. But what we do works really, really well, and that’s why we’re still around.

If I had a roomful of policymakers, I would tell them that in addition to the value we bring our communities, we have to work doubly hard to bring that value. Other programs that are certified by the government don’t have to write a grant to be able to do what they do. We’re certified by the U.S. Treasury. We go through an arduous annual recertification process. We also go through a very rigorous reporting process every year. On top of that, we have to write a grant to ask for the money. Treasury and the CDFI Fund should consider moving Native CDFIs to a block-grant approach and take the grant-writing process off our shoulders. If they don’t like the way we’re reporting, they can always claw that money back or have other repercussions for us. But to make us go through that expensive and time-consuming process with very small, understaffed organizations – where a lot of times we’re having to farm that work out because we don’t have that [grant-writing] expertise – and then have to turn around and report on that same money, it seems like a double whammy. Small organizations have a hard time getting past that. It would be so much easier to be able to focus on the work if we knew every year that certified organizations have certain assets, that are going to get X amount of money. “These are the different ways you can spend that money. Now, go do good things and then report back to us.” It would be cheaper for the federal government as well. They don’t have to go through that process of evaluating the grant. You have a lot of great organizations out there worthy of the money that don’t get the money. Often, the grants they write just don’t pass muster. Well, that hurts that community. You can say, “Well, they should have stepped up their game.” But is that really the business we’re in? We’re not in the grant-writing business. We’re in the community capital business.

NCN: Let’s talk about small business lending because that’s where Sequoyah Fund focuses a lot of its energy and effort. Can you talk about the imprint Sequoyah Fund has made on the small business sector at Eastern Band of Cherokee?

Seagle: We have tracked business growth, employment growth, and we can tell that we’ve helped directly or indirectly create close to 1,900 jobs over the years. Every day, we have people who come in and say, “I want to be able to employ my family. I want to be able to employ my people. I want to be able to benefit my community.” For them, it is not so much about wanting to maximize profits. They’re not after world domination. They want to improve their financial condition and that of people around them. We can drive down the road and see businesses that took advantage of an old facade grant program that we ran in our early days to help spruce up storefronts. We see businesses that have new signage, new parking lots. They’ve done great things with the interior of their buildings. They’re reaching new markets. Just in the last year or two, there’s been an explosion of food trucks because Cherokee has done a good job making places for those food trucks without regulating them out of existence like a lot of municipalities have. We drive down the road and say, “Okay, we funded that one and that one and that one.” Just very visible anecdotal signs. We’ve tracked the numbers, but really the proof is in driving through the community and seeing that we’ve got a shopping center and every business in the shopping center has our fingerprints on it because they came to us at some point for capital, training, or consultation. We’ve got one business in there that has never taken a dime of loan money from us, but they call us on a regular basis to ask for advice and counsel, and that’s every bit as important to our community as the money that we deploy.

NCN: How else does The Sequoyah Fund support the Eastern Band of Cherokee community?

Seagle: In lending money to small businesses, we found there were other opportunities to assist the community. One is that tribal members’ housing was pretty deficient. In 2009, we got $470,000 from the CDFI Fund to start a small housing rehab loan program for enrolled members. We revolved that money over three times, and then got some more CDFI Fund funding to do that. The number of tribal members’ houses that have been improved is phenomenal. We’ve got people out there who joke that we ought to pay them a commission because they’re sending friends, family, and neighbors to us for loans. We lend up to $35,000 at four percent over five years, which is a great deal.

Along the way, we found that transportation was an issue. If you don’t have decent transportation, it’s hard to start a small business. So recently we started an auto lending program for used cars. In the process, we never thought about refinancing cars for people, but we started getting people coming in and saying, “You know, I’m paying 29 percent interest on my car loan. I will never get out from under this car.” And we said, “We’ve got to do this.” We started refinancing some of those higher interest rate loans where, again, we’re putting people in a better condition.

We have a small credit builder loan program. Folks come in and take a course and meet with our credit counselor on a regular basis. They get a small loan that we help them parse out to make sure that bills get paid that will have the highest impact on their credit score. We didn’t spend a lot of money on that program, but we saw huge results in people’s credit scores and in their financial condition.

We also have educational programs. We focus heavily on youth entrepreneurship. We developed our own proprietary entrepreneurship education curriculum, which is now in 43 states and 12 foreign countries. Kids come to our summer camps or learn about entrepreneurship at school through our programs, and they go home and talk to their parents. Before you know it, their parents are starting to see self-employment as a career option. So rather than going out and getting a job, they can go out and create a job.

Indigenous Boutique & Spa photo

Co-owners Jade Blankenship (L) and Jensen Peone (R) of
Indigenous Boutique & Spa, a Sequoyah Fund client. (Courtesy: The Sequoyah Fund, Inc.)

NCN: As you’ve shared, Sequoyah Fund supports tribal members in various ways. Can you share with us an inspiring success story of an individual client you’ve worked with?

Seagle: I’d love to tell you about John. John has a fish hatchery up on a mountainside with stair-stepped fish runs. The cost of food for those trout was getting high. John had this great idea. He invented a feeding system – a solar array that powered a series of bug catchers mounted above the fish runs. He went to USDA for help and USDA said it could provide part of the funds, but it couldn’t cover the whole thing. We jumped in and used that USDA grant as the equity for his loan and got him a huge solar array. On a timer, every now and then you hear a beep, and those fish feeders open and dump the dead bug carcasses into the water. The fish love it. So John was able to grow his business by cutting his cost of food to basically zero, and the excess solar electricity powers about 50 percent of his electrical needs for his residence.

NCN: NCN recently published a report documenting the extraordinary difference Native CDFIs have made in helping Indian Country recover from the COVID-19 pandemic. How has The Sequoyah Fund helped its community through the pandemic?

Seagle: We started by figuring out how to help the people who were already part of our portfolio to survive. We came up with a traffic light model with red, green, and yellow. The red businesses were probably in deep financial trouble before the pandemic, and this was just enough to push them over the edge. We decided not to pursue those. We said, “We’re going to leave you alone. If you can pay, great, if you can’t, we understand. We’ll have a hard conversation when all this is over. But right now, we’re not going to take any action against you.” That gave them a lot of relief. The businesses in the green – primarily service and tech businesses – were unaffected by COVID. But in that bell curve, there were a lot of businesses in the yellow, so we created some programming for those businesses. They kept telling us, “We need more customers. Our businesses closed or our businesses are limited in terms of how many people we can let in.” We created a program called TACTIX to help them get more customers. It’s an advanced online accelerator focusing on digital marketing, online sales, and social media marketing. We’re rolling this out to other Native CDFIs this year, and the results we’re getting from businesses has just been remarkable.

The biggest thing we did during COVID didn’t have anything to do with our normal operations. During the CARES Act and the American Rescue Plan Act rollouts, the tribe got a big bucket of money for small businesses and said, “We don’t know what to do with this.” So tribal council passed a resolution to give this money to Sequoyah Fund and have it pump the funding into the community. Within 48 hours, we created an online application system. We did a training session for our business community. There were many businesses that just needed a small infusion of cash. Fill out the application, walk in the door, we’re going to hand you a $5,000 check. We’re also going to give you $5,000 if you’ll take TACTIX because we know it works. We had facility grants to help people bring their facilities up to what customers were demanding. We had a new market grant, an innovation grant. The tribe trusted us to do this work, to deploy these funds quickly and in a very efficient way. The results have been huge and very visible.

NCN: From your perspective, what do Native CDFIs like Sequoyah Fund need to realize their full potential and maximize their impact?

Seagle: Ultimately, we need people who care about their community. At Sequoyah Fund, our staff are true believers in what we do. Native CDFIs have to be able to attract those people. We don’t compete with small nonprofits for talent. We compete with banks, financial institutions, and the tribe. If somebody graduates with an accounting degree, they can land a secure job with the tribe. I might need that person, so I’ve got to offer pay and work environment just as attractive with sound management practices and good leadership. If we get the right people on the bus and keep them happy, the rest will take care of itself. Grant funders like to give us money for programs, but they don’t like to give us money for the people who see those programs through. I would love to see more unrestricted dollars for staffing because the better our staff, the better our results.

To learn more about The Sequoyah Fund, please click here.

 

Interview #2 Tonya Plummer | Montana Native Growth Fund

Interview #2 Tonya Plummer | Montana Native Growth Fund

Interview #2

TONYA PLUMMER | Montana Native Growth Fund

 

The Native CDFI Network (NCN) developed the “Native CDFIs: Difference Makers for Indian Country” interview series to cast a much-needed spotlight on the many positive benefits that Native community development financial institutions (CDFIs) create for tribal communities and the leaders who help make Native CDFIs the transformational success stories they are.

Tonya Plummer

In this latest edition of “Difference Makers,” NCN sits down with Tonya Plummer (Assiniboine, Sioux and Cree), who serves as Executive Director of the Montana Native Growth Fund (MNGF), a Native CDFI based on the Fort Belknap Indian Reservation in Montana. Tonya brings specialized skills and insight from her career experience in all aspects of mortgage banking, and a passion to inspire a renewed and culturally empowered rise in tribal homeownership as a cornerstone of growing tribal economies.

An enrolled tribal member, Tonya held a key role in guiding the Fort Belknap Indian Community to become the first rural plains tribe to adopt the Hearth Act and create the tribal legal infrastructure needed to support mortgage lending. She is a bridge-builder, creating networks of opportunity and key partnerships to bring capital and development services for home ownership, small business and food sovereignty.

In this heartfelt conversation with NCN, Tonya shares how Montana Native Growth Fund is not only helping tribal members grow their financial assets but also providing them the hope and tools they need to achieve their dreams at home in their tribal community.

NCN: Welcome, Tonya, and thank you for joining us today.

Plummer: Thank you for having me.

NCN: Let’s start with you: Why do you what you do? How did leading Montana Native Growth Fund become your life’s calling?

Plummer: I do what I do so that every child at Fort Belknap can have their own home they own someday. The concept of being grounded in community and culture through homeownership and of experiencing a deeply rooted security and hope for the future have been longtime passions of mine. I spent years and years in mortgage banking learning to originate, process, underwrite, working compliance, learning all sides of lending, and it felt not very purposeful. To be asked to come and figure out a home ownership mechanism for Indian Country, at that point I understood what all of those years of underwriting financial statements in a dark basement meant and what they were preparing me for. That’s when it became a clear calling.

NCN: As you know, there are roughly 70 federally certified Native CDFIs across the country and many more “emerging” ones following in their footsteps. Why did tribal nations and communities feel it necessary to create CDFIs, and what fundamental role do they play?

“We empower the potential of our people so that they can own their own home, start their own business, run a ranch, and grow their own food on our own tribal lands.”

Plummer: I think CDFIs are such natural bridge builders between state and federal governments and tribal governments. CDFIs are the ideal conduit for capital flow that brings life to our communities. I feel like as the West was won and tribal economies crashed again and again and again, we were left with very, very little. And that meant extreme dependance on the federal government as domestic dependent nations. So it’s taken a couple of generations to revive ourselves from that story. Today, as a part of self-determination, CDFIs are standing up this resilience structure every day and really serve as lighthouses in our communities.

NCN: What do policymakers and the general public need to understand about Native CDFIs and the difference they make?

Plummer: It’s a good question. I didn’t even know what a CDFI was when I was asked to start this work. We chose this model because it was the perfect model for us to accomplish what we needed to accomplish. Often, we think of growing economies and economic development and asset building and wealth creation and all of these things that traditional finance structures and financial institutions are supposed to do, and we forget the emotional and social infrastructure that needs to be developed to sustain that financial growth. It’s inherent in the name – it’s community development and a financial institution. To empower those finances to do what they’re intended to do in the community, we have to develop that social and emotional infrastructure. So the model of a CDFI is so unique and so beautiful. It is often misunderstood, and I find myself having to clarify that often when I’m out talking to folks.

NCN: Tell me about the Montana Native Growth Fund. What is its mission, and how does it work to foster prosperity in your community?

Plummer: Our mission is to build strong, sustainable Indigenous communities. We encourage the growth of our people. We elevate the voice of our people. We empower the potential of our people so that they can own their own home, start their own business, run a ranch and grow their own food on our own tribal lands. We do this by focusing on financial empowerment.

We focus on visioning. We think of ourselves as advocates and cheerleaders for our people. We provide a safe place for people to sit down and dream bigger than they ever thought was possible. We adopt a coaching approach when we’re working with our clients. We try to work with our clients as holistically as possible to restore a balance in the way they view themselves, their place in the community, what they and their family can give back and what being a community member really means. We feel like when we do that really well, we inspire a different kind of a growth that makes the rest almost easy. And then we come in with financial products to make that work.

NCN: Can you talk a bit more about the various financial products Montana Native Growth Fund provides? Home ownership and mortgage lending are a big part of it, but can you elaborate on that piece and some of the other financial products you offer?

Plummer: The impetus for the creation of our organization was mortgage lending and a homeownership product, but that’s a heavy lift to start with. We realized a lot of folks weren’t ready for higher levels of credit and needed to take some baby steps towards that. Our tribal enterprise had been offering zero-interest clothing loans for folks to get a clothing wardrobe for their first job, so we revamped that to a workforce support loan and paired it with an essential business skills course and increased that to $1,000 as opposed to the $500 it was at previously. We found most people used it for car repairs, sometimes appliance repairs – anything that would help them get to work and stay working.

Montana Native Growth Fund’s Tonya Plummer with Joanie Rowland, executive director of the Apsaalooke Nation Housing Authority, at the first planning session for the Montana Native Homeownership Coalition. (Courtesy: Montana Native Growth Fund)

Then we found some folks had a lot of old, poor credit that was hindering them from the kind of growth they wanted to achieve, so we rolled out a “fresh start” loan that allowed them to consolidate that poor credit, potentially acquire an asset with it. That became a part of the smart goals that we identified when we went through the initial visioning process with them. Building in those payments and helping them understand how it was helping them grow made it more understandable, and they felt like they were owning their own growth process. From there, we realized that being able to qualify for a homeownership loan meant either starting a side hustle or upscaling their side hustle. A lot of folks have big dreams besides their day-to-day, eight-to-five job. We hadn’t intended to work in business lending, and we quickly found we needed to amend that thought process. We’ve started to roll out a small business program to encourage these early entrepreneurs, and then also understanding our tribal enterprise is growing and there are some larger businesses that need to grow as well. We would like to meet the full spectrum of need there.

NCN: How would you summarize for someone the impact that the Montana Native Growth Fund has made and is making on the community as a whole?

Plummer: Well, if you can imagine yourself in a dark tunnel when you can’t see anything and one person shines a light at the end, and now you can see a little, and then another light comes on and another light comes on. Eventually, the whole place is light, and you feel like you can get where you need to go and we can see each other and we can see a path forward. That’s what I feel like is happening right now. Some of our clients are improving their credit scores 100 points in a year. They’re beginning to feel like they can do things they never thought were possible. And that spirit is contagious in the community. Almost all of our incoming clients are by word of mouth. Folks are saying, “You know, hey, they helped me with this and I feel so much better now. You should go talk to them.” So we’re seeing it spread, and it’s exciting.

NCN: Can you share with us an inspiring success story of an individual client that you’ve worked with that epitomizes the impact that you’re making?

Plummer: I will choose one. Her name is Elisha. She was homeless. Upon graduation, she thought she could make it in the city, wanted to get out and found that was very difficult. So she came back home but was sort of couch surfing, took a job at the tribal enterprise and worked that way for a few months before she came to us. She just needed to be stabilized, so we helped her with housing counseling. Our staff is working towards becoming certified housing counselors. And she was able to find an apartment. We connected her with the Emergency Rental Assistance Program with the housing authority and then also provided her a workforce support loan to help her get stabilized with furniture and a bed and those kinds of basic things that she would need, and then she went through the same visioning process where she listed out where she wanted to be five years, 10 years from now. Most of the time our clients start using a spending tracker, they track where their money is going for about a 30-day period and then have a follow-up with us. Her growth has been exponential in those follow-up appointments. And so now she is thinking, “Maybe I could own a home here for a while. It might not be my forever, but I can do more than I thought I could ever do.” She came back home to the reservation and found the hope and success she needed because a Native CDFI was there to encourage her and pull resources together to help her grow and make an impact in our community.

NCN: NCN recently published a report documenting the extraordinary difference Native CDFIs have made in helping Indian Country respond to and recover from the COVID-19 pandemic. Can you shed some light on where Montana Native Growth Fund fit in and the role it played in helping the community deal with the pandemic?

Plummer: We actually emerged in the midst of the pandemic. We became legal in the middle of 2020 and immediately found the demand for homeownership was so big because our families were overcrowded and in a housing crisis. They could not isolate, they couldn’t social distance. A lot of folks began thinking, “I got to get out of here, I got to get my own home.” So we had an immediate flow of interest there. And then the opportunity to provide even just smaller dollar consumer products. A huge portion of what we provided was COVID relief-related, and had we not been able to provide that service, I imagine our median credit scores would be going down. Folks would be in even a greater financial crisis than they already were experiencing.

NCN: What do you envision as the growth plan for your organization?

Plummer: For a long time, we have been partnering with our tribe to pass the Hearth Act to streamline residential leasing and work on shoring up internal processes there. We also have an MOA with our tribal enterprise and our housing authority on larger-scale residential development. We are the financing piece of that and also the counseling piece. They’re doing the actual home building. We’re not stepping into that space, but we bring that unique perspective so that things are seen all the way through to the end game. That truly means establishing that home ownership is economic development. It’s not just a conversation of housing and creating housing units, it’s getting these folks in homes that they own, where they feel they can give back to their community and stimulate significant increased demand for goods and services. That, in turn, stimulates businesses and the building of the economy.

It’s the reason I picked Elisha as one of our favorite success stories because we truly believe tribal members should not have to move away to be successful or feel like they’ve really experienced life. We should be able to grow up and have a career and grow our families right here at home. I feel so passionately about that. We did a housing needs assessment, and we asked the question, “Does Fort Belknap feel like home?” We had a significant number of tribal members that took that survey. Seventy-five percent of folks living on reservation said, “Yes it feels like home,” and the same percentage of folks living off reservation said the same. That shows an extreme connectedness to community. I hate to say if we build it, they will come. But there’s definitely a market out there that’s bigger than those on the tribal housing waiting list right now. These are folks who are paying a mortgage, working a job off reservation. There are highly trained professionals who would come home if we had the ability to do it. Talk about stimulating economy! Montana Native Growth Fund sees itself as a conduit for growth within our community and a key part of reviving a robust tribal economy.

NCN: Taking a step back and looking at the whole of Indian Country, what do Native CDFIs need to realize their full potential and maximize their impact?

Plummer: Number one is funding so we can get the products that we offer within our communities out there. We’re the ones who are doing that deep work in those communities and understanding how to design products that really do work, doing smart, relationship-based risk mitigation. The more we have to get out there to grow the communities, the more impact will begin to see. In addition, though, I think increased collaboration between Native CDFIs. Not feeling like we’re siloed within our individual communities but working together. I think we’re always stronger together, and that’s a very Indigenous concept of reaching out and lifting each other up. Finally, we need increased understanding within the nation at large and especially within our federal entities about who Native CDFIs are, the impact that we have in our communities and why it is absolutely crucial they increase their outreach to us and recognize Native CDFI’s as the ideal partners to facilitate some of the programs that are intended to get deep into the communities that we serve.

To learn more the Montana Native Growth Fund, please click here.