Severed CNB Head Speaks

David Stewart (Photo Courtesy KOTV)

When last we talked, on Friday, CNB’s board was in the process of putting their CEO on leave.  Turns out, this is a very busy board, because they had another meeting today and KOTV Channel 6 was there.

They got a confession from board chairman/funeral service guy Sam Hart saying that CNB “is in great shape, we’re making great strides, we’re in great shape.”

So if we’re in great shape, then why is the CEO taking a leave of absence?   Well, according to Channel 6, the CEO, David Stewart, says he was “placed on a 30 day leave of absence last Friday. He says he hasn't turned in his resignation, doesn't plan too, and he hasn't been asked to resign.”

So if he’s doing a good job and doesn’t want to go, and his boss, the chairman of the board says he’s doing a good job, what gives?

Channel 6 also says “In 2002, Cherokee Nation Businesses had around a thousand employees, this year it has more than 4,500."

"In 2002, CNB's revenue was close to $25-million, in 2012, it's more than $600-million. Stewart says if this is indeed the end of his time with Cherokee Nation Businesses that he's proud of how the company has grown.”

One person who can shed light on this personnel issue, and has, is the speaker of the council, Tina Glory-Jordan, who shared details of the agreement with the media.  She says that Stewart's situation is neither a “termination or resignation but is a ‘standstill agreement between mutual, voluntary partners…”

CNB Head Gets the Scythe

The Tulsa World is reporting that Baker’s new CNB board chairman/mortician is already taking on grim reaper status: Sam Hart announced today, a mere seven days after being named Chairman, that he and the rest of the board told David Stewart, who runs all of Cherokee Nation’s business operations, to leave his office on Wednesday and turned the keys over to Shawn Slaton, who has been with CNB for “more than a decade.”

The World quotes Hart as saying:  “CNB has established the Cherokee Nation as a strong economic engine in the region, and we look forward to continuing that legacy.”

They also point out that CNB made “record profits -- $87.54 million with nearly $600 million in operating revenues…” in 2010.

So if Stewart was in charge of establishing “the Cherokee Nation as a strong economic engine…” and is making “record profits,” why is he gone, exactly?

We've talked about Baker’s habit of replacing Cherokee citizens with a track record of success with his own folks, because, well, they are his own folks.  Among the highlights: having Hart step away from the embalming table to run all of Cherokee Nation’s businesses because he didn’t want the Cherokee who runs a $5 billion bank giving his advice, and replacing the treasurer of the Nation who won awards for excellence with someone who MIGHT be the best CPA in Vian.

It will be interesting to see where he pulls Stewart’s replacement from.

Bakers Dozen

Just as 13 is a little more than 12,
Baker is trying to cram 10 board members into 9 seats.

Last week, the Tribal Council approved all of Baker’s nominees for everything, including five new board members for CNB in full council on Monday night, and then five more for four more seats in committee on Friday.  

We’ve already discussed the first five, and their varying range of qualifications.

You can read about the new group online as well, and once again their range of qualifications is broad, from a Harvard educated investment guru to a funeral home director.

But a key line in the news releases, are these little lines: “If confirmed, four of the nominees will fill seats that were previously vacant.  The fifth nominee will be on hold and not start his term until later on in 2012.”  The new person will remain ‘on hold until the new term starts.’

Sooooo…. That’s awkward.  Which of the five draws the short straw and has to sit out?  Obviously Baker knew he was nominating more people than the board could hold, but why?  Did he overpromise board appointments to folks?  What’s the rush?  Is someone on the CNB board on the way out and doesn’t know it yet?  

Regardless, Baker is trying to put 5 into 4 and we’ll see how that pans out.  And we have to ask the council members who voted for these guys (and they are all guys), who they want off the board, or who they want to put in limbo.

He Means Business!

Bill John Baker means business.  He told us so, and one of his first orders of business looks to be replacing the Cherokees who run our businesses.   

According to the Cherokee Phoenix, Baker is appointing five new board members, and giving the boot to four folks who are on the board of directors.

The people who Baker does NOT want to run our businesses are:  the former CEO of CITGO, the third largest independent oil refiner in America (David Tippeconic), the executive vice president for financial services for Bancfirst, a bank with $5 billion in assets (Jay Hannah), the top guy at one of the biggest, if not the biggest, commercial real estate company in Tulsa (Mitch Adwon of Adwon Properties) and a financial executive at one of Oklahoma’s only Fortune 500 companies, ONEOK (David Ballew).  All are Cherokee.  All have helped, in some degree, build businesses that now make $90 million a year.

The people Baker wants to replace them are: Tommye Sue Wright, Bob Berry and Michael Watkins, of Tahlequah, as well as Stilwell’s Rex Earl Starr and Brent Taylor from Pryor.  The Cherokee Phoenix sums up their experience:

“A real estate agent with Century 21, Wright manages more than 50 sales agents and support staffers and is responsible for more than $60 million in real estate sales annually...

A graduate of Harvard Business School, Berry is the founder of American Nursery Products and Tri-B Nurseries. His family owns two nurseries and Tahlequah’s Cherry Springs Golf Course... 

Starr is a private practice attorney whose clients include five school districts in Adair and Sequoyah counties...

A graduate of Northeastern State University, Taylor is an entrepreneur who has brokered lease agreements with Jackson Hewitt, Pizza Hut, Covington Finance and Pryor Creek Music Festivals...

Watkins retired earlier this year after eight years as chief financial officer and controller of Park Hill Plants. He is a former vice president of Cherokee Nation Enterprises, now Cherokee Nation Entertainment.”  

All of these people have had good careers.  The Phoenix doesn’t mention it, but we’ll give Baker the benefit of the doubt that they are all Cherokee until we're told otherwise.  And maybe it’s just us, but when you are replacing a guy who has run one of the biggest companies in the world with a guy who’s resume includes lines like ‘brokered lease agreements with Pryor Creek Music Fesitivals,’ or one of the top guys at a $5 billion bank with a guy who does a little legal work for “five schools in Adair and Sequoyah counties” that seems like a downgrade. 

22 Days Until the New Election: Pants on Fire!

Our evening did not go according to plan.  We had a blog ready to go, until we got a phone call and had to write a new blog.  Because if there is one thing you can’t do to us here at Cherokee Truth, its call us up on the phone, act surly, and lie to us.  And that’s what happened tonight.

We got phone call(s) that said, to the best of our note taking ability: “For 12 years Chad Smith has refused to audit the casino’s finances but Bill John Baker will order an independent audit to make sure that casino money goes for services to the Cherokee people and not to line the pockets of campaign contributors and vendors.  I hope that Bill John can earn your vote in the upcoming election.”

As readers of the Cherokee Truth know, this is a lie and worse-- Baker knows it is a lie!  As we showed everyone in May, 53 Days before the June election, the Cherokee Nation and its businesses are audited every year and win awards.  Mr. Baker knows this, because the audit is not only presented to the CNB Board (of which he is an advisory member,Resolution R-52-10) but also the council’s executive and finance committee just a few months ago.

Not only are the audits for the past 10 years available online, but video footage of Baker sitting and listening to the audit being presented is also available online!

The auditor even talks about the special audit of JUST THE CASINOS, which is sent to the feds every year for compliance purposes.

There’s also the Tulsa World story that cites a national rating company for praising Cherokee Nation for its "careful and conservative governmental financial management" and for its "ability to manage cash flow issues." It goes on to tout Cherokee Nation's creation and expansion of non-gaming businesses like health care and information technology. 

To sum up:  The casinos are audited every year.  They win awards for their clean audits.  Baker knows this and lies about it anyway.  Apparently he thinks no one will notice that he’s not telling the TRUTH. He must think we’re all stupid and can’t look up readily accessible public information that shows he’s lying.

We’re sure the Cherokee Nation isn’t perfect, and Baker can certainly point out all the flaws he wants, but if he has to lie to people to create problems with the Cherokee Nation, that says more about him than it does anyone else.

12 Days Until the Election- Guest Blog featuring Chief Chad Smith

Two weeks ago, we asked Baker and Smith to submit a blog, 700 words or less, for our audience. We asked that the blogs be positive and about their candidacy, and pointed out that it would be a way to reach a few hundred Cherokees without having to kill and fry a single hog. Both candidates responded to our email, but only one actually submitted a blog, and his blog will run today.

Those of you who support Baker, we apologize that his campaign chose not to respond, but as we pointed out, no hard feelings.  That being said, here is Smith’s guest blog:

____________________________

I want to begin by saying Wado to Cherokee Truth for allowing me to post a blog on this page and I commend the site for its dedication to providing accurate information to Cherokee voters.

I’m proud to be principal chief of the great Cherokee Nation, because I love the work of building our Nation. I never underestimate our people, our employees or our future because I believe as Redbird Smith said, “We are intelligent, industrious; we are loyal and we are spiritual.” These are important traits to consider when we are on the verge of selecting leadership.

By just about every measure, the Cherokee Nation is better off today than it was 12 years ago.  I will always believe that the very best service we can provide for our people is a job.  We’ve created 5,000 jobs with great benefits that enable our people to take care of their families and contribute to their communities. And Cherokee Nation hiring policy requires that Cherokees be considered first for all jobs.  Look around and ask yourself if more of your friends and family work for the Cherokee Nation and our businesses today than 12 years ago.

While we are proud of our successes in gaming, we know that to provide a secure future for generations of Cherokees, we must work to create a strong and diverse tribal economy.  By operating on a sound fiscal policy that reinvests our gaming profits, we own businesses that provide environmental services, home health care, IT and hospitality services.  Our strong credit rating enables us to receive capital improvement loans at interest rates that save our Nation thousands of dollars.

Our health care system’s budget in 1999 was just $18 million. Now, it’s more than $300 million. When some folks were doubtful about Cherokee Nation assuming operations of W.W. Hastings Hospital, I had faith that our employees could do a great job, and we’ve increased services and put $9 million into additional facilities there.

Our housing program went from putting 23 families in houses each year to putting more than 200 families in houses each year. I believe our housing employees do an amazing job and we receive thank you notes and compliments on their work daily.  

Under my leadership and thanks to our staff, the CN has received national awards nine years in a row for its finance system and audits. I proposed the Nation’s first Freedom of Information Act, Open Records Act and Free Press Act.  I strongly believe in the need for our government to be both transparent and accountable which is why our budget is posted online and Annual Reports are delivered each year to Cherokee citizens, both on our government budget and on the division of casino profits.

I’ve disagreed with our highest court, but always respected their decisions and their position as a third and equal branch of government.   It is my sworn obligation and my constitutional duty to both follow the law and to defend adamantly the Cherokee people’s right to their own constitutional process.

I have increased our overall budget for services from less than $150 million to $600 million, in part because of our efforts in Washington, D.C.  Education will continue to be one of my highest priorities.  During the past ten years, the Nation has provided more than 23,000 students scholarships for higher education and assisted thousands more through vocational training grants.

I could go on talking about the great things our employees have done and how far we’ve come, but if you’ve been around here, you see it. Still, I know there is a much more we can accomplish and I am running for re-election to continue building and improving the Cherokee Nation.  Recently, President Obama said, “We should live up to the expectations of our children.”  As Cherokees, I believe we must look to the future in even broader terms.  Our children and theirs and theirs.  Your response to this call will ensure that the Cherokee Nation will continue to be stronger than ever, passing on our great legacy to those who come after.

Wado,

Chief Chad Smith

40 Days Until the Election- Who Decided to Build that Casino, Anyway?

We had a question earlier this week about who makes the budget decisions at Cherokee Nation Businesses.  We’ll keep it short so your eyes don’t glaze over.

The truth is out there, if we just know where to look for it.  In this case, we look on the Cherokee Nation’s online resource for legislation and find that the tribe’s corporation act appears to have first passed in 1996. 

It’s been amended a few times since then, the most notable being in 2005, when CNB was established to basically own and manage the other companies (mainly just CNE and CNI at that time), and in 2010 when they combined all the boards of directors to form one company.

Smith signed the amendments in 2005 and 2010, and Baker voted for them, so there should be no controversy there.  Baker also voted for the 1996 act when he was on the council.

Those acts designate the corporations and their board of directors to make the policy decisions for the businesses.  The board of directors are proposed by the Chief and confirmed by the council.  So the elected officials don’t make the decisions on the businesses, but they are able to hold them accountable.

After the debate where Smith talked about the smart guys from Harvard saying that, basically, the Cherokee Nation has done it the right way by keeping politics out of business, we looked to find out if the smart guys from Harvard actually said that.  It took a few minutes of googling, but it turns out, yes they do (skip the boring stuff and go to page 12).

Turns out that research confirms what your eyes can probably tell you:  tribes with a stable government and no politics in their business probably do better than the other way around.  Chickasaws and Choctaws, for instance, are doing really well and don’t play politics with their businesses. And they’ve had the same Chief longer than the Cherokees.

42 Days Until the Election- Debate Blow by Blow

Tonight, Principal Chief Chad Smith and Bill John Baker went mano-a-mano at The Cherkee Phoenix Debate. 

Cherokee Truth will just jump right in with a little analysis and as much truth as we can cram into one blog.

Councilor Bill John Baker
Photo credit Cherokee Phoenix

Principal Chief Chad Smith
 Photo credit Cherokee Phoenix 

In the opening statements, Smith basically said the Cherokee Nation is the best thing since fire.  Baker basically said the Cherokee Nation is going to h**l in a handbasket and/or private plane.    Baker lit into Smith pretty hard, and Smith was given a chance to respond.  He did so by saying he didn’t think the Cherokee people wanted to hear a lot of negative talk and declined to discuss it further.

The first question was about their top priorities as Chief.  Smith talked about his vision for the Nation as a happy healthy people, creating jobs and self-reliance.  Baker talked about how much money the Nation has but isn’t spending on housing and health care, but if he were Chief the Nation would. 

The second question was about water rights.  Baker said, basically, he didn’t know much about it, but he’d hire the best lawyers we can to do this because it’s as important as oil to the Osages.  Smith said he did know a lot about it, and that under his watch the Nation actually won a court case saying we had water rights, and that whatever water rights the state thinks they have, the Cherokee Nation actually has.

The third question was what is the greatest political mistake they ever made.  Smith got some pretty hearty laughs by saying his was getting his picture taken with former U.S. Speaker of the House Nancy Pelosi, then moved on to talking about increasing health care budgets.  Baker didn’t really answer the question either, just saying we all make mistakes and everyone could do better. 

On the fourth question, things got a little weird.  They asked about CNB buying a business in Colorado. Baker responded first by saying CNB is all screwed up, they have bad policies and that the council should be in control of the purse.  Then he lit into Chief Smith’s claim of creating 5000 new jobs.  Instead, Baker claimed the Nation actually lost 1000 jobs during Chief Smith's administration. 

The Cherokee Truth about had a milk-through-the nose moment there… We’re not sure how many more jobs are at Cherokee Nation now than before, but it’s sure as heck is NOT 1000 less!

Smith said that smart people at Harvard say that tribes do well in business when they have a separate board running the businesses, not the Tribal Council, saying that CNE, for example, used to have 500 employees and make $3 million a year and now they have 3,500 employees and make a ton more.  On the claim that the Nation has 1000 fewer jobs than before, Smith said he ‘challenged the mathematics’ of that. 

Question 5:  Basically, what’s the best way to provide housing for Cherokees?  Fortunately on this one, we have a Cherokee Phoenix  truth report (pg 10) that sorts it all out.   Basically, the truth on this is that yes, under the old system, there was a 50 year plus waiting list and yes, under the new system the Nation is helping tons more people.  But, it also says that Baker might be right about money at the housing authority that could be spent on additional programs.

The sixth question was about term limits for the Council and for the Chief and Deputy Chief.  Baker went first and said he was in favor of term limits for the Chief (just like the state and feds have for their top executive) but not for Council.   He said there is too much power at the top.  Smith said he didn’t think the argument was about too much power, but that Baker didn’t have the power and wanted it.  He said the Cherokee people went 70 years without being able to elect their own Chiefs after statehood, and we shouldn’t hamstring the power of the people to decide who they want on the council or as chief.

Question 7:  A question asking the candidates if CNB should release things like purchase prices or lease agreements when they buy businesses.  Both candidates agreed CNB should do so…. Smith by saying rather briefly that he’d already instructed CNB to do that in the future, and Baker saying that basically the Cherokee people are the shareholders and had the right to know just as much as IBM’s shareholders have a right to know these things.

On the last question, things got a little tense again.  The question was about the pay raise that is set to go into effect for elected officials of the Cherokee Nation starting next term.  Baker said it was wrong and the Chief should have vetoed it, especially since we are having budget cuts for services.  Smith said it was a non-political process and while he didn’t agree with the amount of the raise, he respected the process and the will of the council.  He pointed out that he, Smith, was the only candidate to say he would reject the raise, and that even though Baker had asked the council to turn down the raise, he never actually said he would reject the raise himself.  He said Baker had taken a $6000 backdoor raise for travel expenses this past year, and challenged him to turn down the raise for Chief or council (since even if Baker loses, he’ll stay on the council).    Baker did not directly answer whether he would or would not take the raise, so on Smith’s final rebuttal, Smith pointed out that Baker still had not declined the raise.  At that point, the moderator gave Baker a third chance to speak on the issue, but Baker again did not turn down the raise, though he said he’s never been in it for the money.

Oh yeah, another big moment, and I can’t remember which question it was a part of, was when Baker was going off about the private plane again and how no one can get their hands on the flight logs.  Then Smith walked over and handed Baker the logs and told him what Cherokee Truth said 8 days ago: JUST ASK THE PEOPLE WHO HAVE THE LOGS AND THEY WILL PROBABLY GIVE THEM TO YOU!  I’m sure we’ll hear more about those logs in the coming days.  In the meantime, maybe all the candidates will start following our wise advice! 

Finally, they had the closing arguments, which were just like what we heard at the top.  Smith told a story about kids speaking Cherokee to him in the new Sequoyah gym.  Baker talked about the plane and travel records, even though he already had them now.    He promised to sell the Cherokee Nation plane on Day 1 when he is chief. 

There is not a link to watch online yet, and it’s not our place to say who ‘won’ or who ‘lost.’  But at the end, one candidate looked about 2.5 seconds away from throwing a hissy fit, and the other one looked relaxed. 

Sorry this is going up so late, but as you can see, it’s really (too) long and took a while to put together.  

53 Days Until the Election - Audits & Transparency

In this election, we've heard a lot about transparency, access to information and the need to audit the government and it's businesses. 


The Truth? The Cherokee Nation and it's businesses are some of the most audited entities in the state of Oklahoma. For Cherokee Nation Businesses (CNB) alone, 6 independent and separate audits are done each year, and when you look at CNB and The Cherokee Nation Gaming Commission together, there’s probably 30 or 40 independent internal auditors that work on the various entities at any given time. And they've received clean reports and favorable audits.


But don't take my word for it. Watch for yourself. Sure, it's kind of boring, but it's the truth. 


The link below is to video from last week's (4/28/11) audit report of all of Cherokee Nation's businesses to the Cherokee Nation Tribal Council Executive Finance Committee by Don Williams, partner at the accounting firm BKD, the 10th largest accounting firm in the United States. BKD professionals performed the audits described above in addition to ongoing internal audits inside Cherokee Nation's businesses. 


Click here to watch Mr. Williams report, found approximately 00:36:50 into the committee meeting.

The following link is to a recent short article in the Tulsa World on April 17, 2011. Click here
Here is a clipping as well:

This report refers to the tribal government, and praises Cherokee Nation on its "careful and conservative governmental financial management" and for its "ability to manage cash flow issues." It goes on to tout Cherokee Nation's creation and expansion of non-gaming businesses like health care and information technology. 


If you want to know more about Cherokee Nation's budget, financials, travel expenses of elected officials or maybe want to know more about where the casino money goes, just click here. This information is currently available and has been available to the public for years.