Native Advisory - Jump Start the Journey Towards Sustainable Economic Prosperity

Federal Government shutdowns create uncertainty and challenges across the world, but for Tribal Nations, the stakes are real. As sovereign nations that are due a trust and treaty responsibility by the federal government, many Tribes depend on federal funding for essential programs and services, such as healthcare, housing, and public safety. When that funding suddenly halts, decisions and actions must be taken by Tribal Leadership.

When I served as Treasurer of the Cherokee Nation, I led through two of the longest government shutdowns on record – 35 days in 2018-2019 and 16 days in 2013. While the average shutdown length is 8 days, it’s imperative to take the possibility seriously. If you’re a Tribal leader or executive, you might be wondering how to navigate such a situation effectively. I will walk through 3 steps to manage a government shutdown with greater awareness and confidence.

Step 1: Assess Available Cash Resources and Implement Contingency Plans

The first step leading up to a potential federal government shutdown is understanding the cash resources you have on hand.

Conduct a Financial Assessment

Shore Up Cash Reserves: How much cash in the bank does your Tribe currently have? Leading up to a rumored government shutdown, have you drawn down all possible funds? These funds will be crucial for maintaining operations while federal funding is on hold.

Know Spending Trends & Review Budgets: How much money do you spend every week? Every two weeks? Every month? Knowing how much cash burn you have, will help you understand how long you can stay in operation at current levels and can inform areas that will need cutbacks. Consider temporary “cost containment” measures such as forgoing travel, hiring freezes, or delaying capital expenditures.

Evaluate Other Cash Availability: Consider if available cash at Tribal enterprises or established lines of credit might help fill the gap.

Implement Contingency Plans to Prioritize Essential Services
Contingency plans should be developed well in advance of a government shutdown, but if you don’t have them, decisions will need to be made on which programs and services will need to stay operational, and which will need to go lean or dormant.

Once you have a clear picture of your financial standing, rely on your contingency plans to prioritize the programs that must continue uninterrupted. This might include:

Healthcare services, especially for elders and children.
Public safety programs, including law enforcement and emergency response.
Food distribution programs or other critical aid initiatives, like housing.

Whether implementing existing plans or creating a temporary contingency plan, aligning your available cash resources with spending trends helps ensure these critical services remain operational within allowable grant uses, and then be prepared to adjust as the situation evolves or the shutdown goes longer than anticipated.

Step 2: Communicate Transparently

During uncertain times, clear and consistent communication is key. Tribal leadership and citizens need to know what’s happening, what’s being done to address the challenges, how they will be affected, and also – how they can help!

Internal Communication
Keep Tribal leadership, department heads, and employees informed through regular updates, including:

The Tribe’s financial status and the predicted length of time “status quo” operations can continue.
Operational priorities and any necessary changes in service levels.
Plans for addressing the shutdown should it progress longer than expected.
Support for employees – both essential and non-essential – prioritizing their wellbeing, communicating with them honestly, and giving them access to resources if furloughed.

Citizen & Community Engagement
Transparency builds trust. Use Tribal news outlets, social media, and community meetings to keep Tribal citizens and elected officials informed. Let them know:

Which programs and services will remain operational and any temporary adjustments, like reduced hours or alternative resources.
Create talking points to inform elected officials (House and Senate) on how the shutdown is causing impacts. Empower your citizens with these talking points to reach out as well.
Work with national Native organizations to lobby Congress and federal agencies for solutions. Highlight the unique challenges Tribes face during shutdowns and push for changes that protect Tribal sovereignty and funding.

Step 3: Plan for Post-Shutdown Recovery

When the shutdown ends, it’s important to do a lookback on what happened, what worked, and what didn’t.

Evaluate the Impacts
Conduct a thorough review of the shutdown’s effects on your Tribe’s finances, operations, and wider community impacts on both Natives and non-Natives. Use this data to adjust budgets, evaluate “cost containment” measures, and identify areas where the Tribe was most vulnerable to strengthen emergency preparedness for the future.

Replenish Emergency Reserves
If you had to dip into savings or tap into other available cash, make it a priority to rebuild those reserves or payback loans. Consider creating a dedicated emergency fund for any future crises.

Final Thoughts & Next Steps

A government shutdown is a challenging time for any leader, but with thoughtful planning, transparent communication, and a focus on the well-being of citizens and employees, Tribes can lead through uncertainty with resilience and strength in knowledge.

Through my CFO Advisory services, I work one-on-on with Tribes to help them implement these strategies, making things easier for you when times get hard.

Contact me at info@nativeadvisory.com to discuss how I can help you and your Tribe with all of your financial challenges and opportunities.

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