Utah Navajos are calling for investigation of a financial setup under which they fear oil royalties held in trust for them have been placed at risk.
They also say they fear earnings may have been siphoned off through businesses that were intended to provide jobs and profits for their hundreds of Utah Navajo owners.At issue is operation of Dineh Lumber and Building Supply, Inc., a for-profit company that buys lumber at wholesale and resells it to the tribe under contract, along with relatively incidental retail sales.
Tribal sources close to its operation say the tribe is by far its No. 1 customer in what may total more than $1 million in purchases this year.
Dineh Lumber, which recently was moved from Montezuma Creek, Utah, to Church Rock, N.M., bids for tribal contracts like other companies, but is given preference because it is owned by Navajos. About 6,500 Navajos live in Utah.
The company is one of four established under the umbrella of Utah Navajo Industries, which in effect is a holding company operating under the supervision of the Utah Navajo Development Council. The council receives oil royalties that are held in trust for Utah Navajos by the Utah Division of Indian Affairs, a state governmental agency.
The Utah Division of Indian Affairs' board is appointed by the Utah governor, subject to guidelines as to its makeup; Navajos elect the eight members of the development council, who in turn appoint the seven-member board overseeing Utah Navajo Industries.
Since by law the oil royalties cannot be used directly to finance UNI's businesses, the development council secured loans to do so and pledged the royalties as security.
But two of the four UNI subsidiaries have failed, giving rise to Utah Navajos' fears their oil royalty trusts are at risk.
One - First Native American Corp., a clothing producer - filed in July for protection from its creditors under federal bankruptcy laws while it undergoes financial reorganization. Another - Navajo Resorts, which operated the San Juan Marina on Lake Powell - is phasing out the marina in the wake of a sudden 1989 flood that destroyed most of its boats.
A third business - the West Jordan Shopping Center in Salt Lake City - is managed by an outside management team.
But according to copies of financial records leaked to the press, the fourth - Dineh Lumber - has been paying $5,000 a month plus expenses to a non-Indian consultant team in Albuquerque, N.M., which also owns at least one of the firms from which the company buys its lumber and supplies.
Additionally, the tribe's payments for its purchases have not been issued to Dineh Lumber, the company from which ostensibly the tribe was buying the lumber, but rather have been paid to the company's accountant - Kenneth Redwine of Albuquerque, and to a housing construction supervisor in Tuba City, Samuel Tso, the records show.
Dineh Lumber also paid $1,000 to a Navajo woman who served as campaign office manager for Navajo interim tribal President Leonard Haskie during the presidential primary race, the financial records show.
"I'm appalled that UNI and Dineh have allowed this," Commissioner Mark Maryboy of San Juan County, Utah, said in pledging to seek state and tribal investigation. "We all trusted the board and here they were living in `hog heaven.' "
Haskie had hired Marianito's brother Frankie in early July as press officer for the president's office but dismissed him in late July.
Betty Roanhorse, seated at Haskie's campaign office the day of the presidential primary, was paid $250 by Dineh Lumber on four occasions in May and June. She denied she was paid to work in Haskie's campaign office and said the money was "for part-time advertising." Haskie denied knowledge that Roanhorse was being paid by Dineh Lumber and said her involvement with the company was "totally her own decision."