WASHINGTON — As Congress prepares to wrap up work for the year, Hawaii Sen. Brian Schatz is looking to cut an ambitious deal that could pump tens of millions of dollars of new money into Native Hawaiian housing for at least the next decade.

But first he must navigate a generations-old controversy in North Carolina involving a Native American tribe that has struggled for more than 130 years to gain federal recognition.

Lawmakers are back in Washington this week for a lame-duck session that’s expected to see a flurry of activity as Democrats try to put the finishing touches on their top legislative priorities before ceding control of the House to Republicans in January.

Near the top of the list is an omnibus spending bill that would set agency funding levels for 2023 and help avoid a government shutdown.

While negotiations are ongoing, Schatz is hoping to use that legislation as a vehicle to reauthorize the Native American Housing Assistance and Self-Determination Act, which expired in 2013.

“Passing any bill is about finding out who objects to it and addressing their objection,” Schatz said. “Suffice it to say this has been a labyrinth to navigate. We’re now on the other side and just trying to hitch a ride onto the next must-pass bill.”

NAHASDA provides hundreds of millions of dollars each year to tribal governments, including the Department of Hawaiian Home Lands, to support affordable housing and infrastructure.

While Congress has continued to allocate funding to NAHASDA programs since its expiration, that has not always been the case for DHHL. The agency has seen its funding fluctuate over the years, from about $10 million a year down to zero and then back up again.

Just last year, Schatz, who also sits on the Appropriations Committee, was able to secure $22 million in new funding for the agency, which has helped make up for the previous losses.

“What reauthorization provides is security,” said Tyler Gomes, deputy director of DHHL. “With NAHASDA being a year to year process we cannot plan in more than a one to two year horizon because there’s no guarantee we’ll have NAHASDA money next year.”

Reauthorization would guarantee funding for at least 10 years, he said, which means DHHL could better plan for how best to spend the money for beneficiaries.

“If you want to address the housing crisis you have to flow capital like blood through a vein.” — Robin Danner, Sovereign Council of Hawaiian Homestead Associations

DHHL began receiving NAHASDA money in 2002 after Congress passed legislation amending the original law to include Native Hawaiians. For more than a decade, DHHL received about $10 million a year through the program.

That stopped in 2016, however, after DHHL came under fire for not spending the money it had received.

According to Gomes, the agency had socked away nearly $70 million in a rainy day fund rather than spend the money on behalf of its beneficiaries.

In response, Congress didn’t allocate any NAHASDA money to the agency in 2016. Since then, DHHL had only received about $2 million a year until Schatz upped the allocation in 2022.

“My hope is that reauthorization will ensure that the levels of funding we’re seeing today can continue into the foreseeable future and only get bigger,” Gomes said.

He’s not the only one keeping an eye on Schatz’s maneuvering.

Robin Danner, the Washington, D.C.-based chair of the Sovereign Council of Hawaiian Homestead Associations, said the Hawaii senator has included critical language in the bill that will expand a HUD loan program for low income beneficiaries.

Under current law, the loans are only allowed for properties located on DHHL land. But if NAHASDA is reauthorized it will allow those beneficiaries to obtain loans for property anywhere in the state, something that could drastically open up the housing market for those waiting for homesteads.

“If you want to address the housing crisis you have to flow capital like blood through a vein,” Danner said. “This would provide yet another vein of capital flowing through Hawaii’s economy to build and buy housing.”

Politics Afoot

There’s no guarantee that Schatz will be successful. Bills to reauthorize NAHASDA have been introduced in every Congress since 2013 and have repeatedly failed.

Already he’s faced a number of hurdles on both sides of the aisle that he’s had to navigate.

In the House, Rep. Maxine Waters, the Democratic chair of the House Financial Services Committee, presented a major challenge.

Waters has been a vocal advocate for the Freedmen, who are the descendants of Black slaves held by the Five Tribes, which includes the Cherokee, Choctaw, Chickasaw, Muscogee and Seminole. In July 2021, she held a hearing on NAHASDA reauthorization in which she expressed concern that certain tribal governments were discriminating against the Freedmen by not granting them full tribal citizenship and benefits.

She even floated the idea of withholding federal housing money from tribes that refused to grant the Freedmen full tribal citizenship.

“This is a fight that’s about fairness and equality,” Waters said at the time. “For one minority group to discriminate against another minority group cannot stand. And as chair of this committee, I don’t intend for it to stand.”

Schatz said Waters has since become an ally in part due to his willingness to address the Freedmen issue head on by holding his own hearing on the issue at the Indian Affairs Committee.

He still has challenges in the Senate, however.

Republican senators Thom Tillis and Richard Burr, both from North Carolina, are seen as two of the biggest obstacles to getting his bill passed.

Several sources familiar with the negotiations said Tillis and Burr have essentially placed a block on key pieces of Indian Country legislation, including NAHASDA reauthorization, as a bargaining tactic meant to secure federal recognition for the Lumbee Tribe, which is located in their home state.

The Lumbee’s struggles are well documented, and the tribe — which boasts nearly 60,000 members — has been fighting for more than 130 years to gain access to federal benefits granted to other recognized tribes.

Presidents Barack Obama, Donald Trump and Joe Biden have all backed federal recognition for the Lumbee, and just last year the House voted 357-59 to grant them official tribal status and benefits.

Where they’ve fallen short, however, is in the Senate.

Over the years, there have been intensive lobbying efforts meant to undermine the Lumbee’s quest for federal recognition, particularly by the Eastern Band of Cherokee, which is also located in North Carolina. Other tribes have followed suit.

“All I can say is I’m working very hard on whatever is possible to pass, and I think it’s too early to know exactly in what form these bills will pass.” — U.S. Sen. Brian Schatz

The reasons for the opposition are complex and touch on a range of issues, including concerns over casino competition, the division of federal resources and tribal identity. There are some who argue that the Lumbee cannot trace their ancestry back to a single Native American tribe.

What it all amounts to are a number of competing interests pushing and prodding on lawmakers from different angles every time the issue comes up for debate.

Schatz said he supports federal recognition for the Lumbee, but he also understands that not all of his colleagues are on board.

He also takes issue with some of the arguments that have been made against granting the tribe the recognition he says it deserves.

“There’s been some historical racism around the Lumbee,” Schatz said. “The fact is that a lot of Lumbee members are also African American and you get this kind of whisper campaign where people say, ‘Well, they’re not Indian,’ and I find that disgusting and historically wrong.”

Neither Tillis nor Burr’s offices responded to a Civil Beat request for comment.

Schatz said he’s hopeful that he can strike a deal with his fellow senators, but he also acknowledged that doing so means several parties still need to come together.

“This is sort of nothing is agreed to until everything is agreed to, and so we’re working on a global agreement that could unlock the passage of NAHASDA and several other pieces of legislation that the committee has already marked up,” Schatz said. “All I can say is I’m working very hard on whatever is possible to pass, and I think it’s too early to know exactly in what form these bills will pass.”