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This is Part II of a two-part series. Part I appeared in Sunday’s paper.

A series of business investments totaling approximately $65 million, which have, to date, achieved no financial return, forced the Lac du Flambeau tribe to consolidate its debts with a $50 million bond in January 2008.

Though tribal president Victoria Doud and her allies say that the financial status of the tribe is sound, other tribal members are growing increasingly angry and concerned about what they say is secretive and corrupt government, and some are reportedly planning a takeover.

“There are invisible warriors among us,” read an anonymous statement released on Friday, March 14, “who are willing to do whatever it takes to make things right for the whole. At this point the only thing left for change is takeover.”

The group, who is remaining anonymous for fear of arrest, says that these business decisions, culminated in the $50 million bond, are threatening the tribe’s future economic stability.

These fears are shared by many Lac du Flambeau residents who agree that changing the government might be the only solution.

“Right now we are doing everything we can to replace corrupt council members,” said tribal descendant and LdF resident Anita Koser, “with honest people of integrity who have the best wishes of the tribe at heart. Things are very bleak here – these people have devastated the tribe financially and spiritually.”

$50 million bond is crippling tribe

Recently elected council member Brooks Big John agrees, saying that the bond issue was a crucial financial decision that was taken far too quickly and without proper information or education. Now the costs are crippling the tribe, he says.

“The bond issue really put us to our knees,” Big John said. “It’s caused a drastic cash flow problem for the tribe.”

The 585-page bond document was presented to council members on Jan. 2, 2008, Big John says, and they were urged to sign it that day so that work could continue on their multi-million dollar casino boat and hotel complex project in Natchez, Miss., even though it meant putting up 100 percent of the revenue from the Lake of the Torches casino and hotel complex as collateral.

“Not one council member read it before voting on it,” Big John said, “and no one understood it. Now it has basically leveraged all our money from our cash cow – the casino.”

Big John’s concerns are echoed by Bill Johnson, director of FWJ Development and Consulting, who has a background in the banking and gaming industries, and has attended recent meetings with tribal council members.

“It appears that because of a ‘hurry up mode,’” Johnson wrote in a six-page memo to council members on Feb. 25, 2008, “Stifel Nicolaus was engaged to raise money for the tribe and, as a result, probably did not do their best work for the tribe….rather than do what was in the best interest of the tribe, they (outside advisors) sacrificed needed tribal cash flow to service debt at a very high rate of interest. The Mississippi project has to be scaled back and a restructuring of the $50 million bond issue has to be explored.”

But council member Dee Mayo (a Doud ally) says that the bond issue was researched by the council for at least a year and a half, and that it was the best deal for the tribe – even though the initial rate offered was 6.75 percent, she said.

“When we originally started to pursue the bond over one and half years ago,” Mayo said, “the percentage started at that (6.75 percent). (But the) economy has continued to recess.

The tribe has been working on this consolidation for over one year with the assistance of Stifel Nicolaus through a competitive process. This note was in the best interest of the tribe to consolidate the numerous payments they were making and to continue with the progress of our Natchez project.”

Big John and fellow council members Tom Maulson and Muriel Fralick voted against the bond, but were defeated by a majority vote.

Land mortgaged to raise cash

The tribe is locked into the bond for five years at 12 percent, Big John says, and is now desperately trying to raise more money by mortgaging 1,800 acres of tribal lands.

“We’re still short of cash,” he said, “so now we’re mortgaging fee lands.” Mayo agrees that it is a necessary means of raising credit for the tribe.

“It is an option to help with an operating line of credit for tribal government,” she said. “We are continuing to work on a cash flow plan.”

This mortgaging of tribal land has upset many tribal members, particularly given the spiritual connection American Indians have with the land, and the fact that historically, 90-million acres of treaty land were lost by natives because of the Dawes Allotment Act of 1887. Under this act, land was assigned to American Indian under the guise of assimilation, but most of it actually ended up in the hands of white owners, purchased at discount prices. It has taken almost a century for tribes to regain ownership of much of this land, and tribal members in Lac du Flambeau are deeply concerned about jeopardizing it.

“There’s no way of getting it back once it’s gone,” said 79-year old Dorothy Thoms, who was born on the reservation and has spent a large part of her life there. “That’s why I am so against mortgaging our land. We’re just getting further and further into debt. It’s unbelievable. I never thought it could happen here.”

Job cuts

In addition to mortgaging tribal lands to save money, the tribe has also cut back jobs. According to Big John, between 100 and 150 people have lost their employment within the small community. The tribal website, www. lacduflambeautribe.com, is down, and the local newspaper, The Lac du Flambeau News, has also been closed.

“It’s very unfortunate that this had to happen,” said former employee and tribal member Greg Johnson, who was the newspaper’s editor for four-and-a-half years until he lost his job last month. “But the tribe had to make cuts. Besides me, there are a lot of other tribal members who are suffering because they’ve lost their jobs and don’t have any other means of income.”

Mayo says that it was a management decision to close down the website and newspaper, which fall under one program.

“It was a decision based on management,” she said. “The web page was to be online. This concern has been referred to the appropriate staff.”

She said that approximately there had been approximately 50 layoffs.

“This includes reduced hours and layoffs,” she said. “Simpsons Electric employees are not included in the number.”

Tribe’s future at risk?

In the meantime, those behind the planned coup say that the leaders who have caused this situation are still holding onto their jobs, while the whole stability and future of the tribe is at risk.

“The tribe has suffered loss of employment for many people,” their statement reads, “yet our leaders and their favorite few still hold their positions. We are not a secure tribe. Unless you are from the right family, unless you are on the right ‘side,’ you face persecution from our tribal government. We live under the constant fear of losing our homes, our jobs, our children, and our freedom if we do not say the right things or side with the right political party.”

Big John says he still hopes that council members will be able to work together to resolve the problem, and protect the tribe’s future for its youngest members.

“We’ve got to get beyond pointing fingers,” he said, “and figure out how to survive. When I see the little kids here, it gives me motivation in the bottom of my heart to make things better for the tribe.”

But Big John also says he understands the desperation and anger of tribal members, and would not blame individuals for staging a coup.

“How can our people trust us when they’ve seen what happened with the Dream Catcher?” he asked. “These people are up to their necks and drowning. A takeover is the last straw. It’s a cry for help.”

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