Budget shortfalls for the Sault Ste. Marie Tribe of Chippewa Indians have so far been reduced to $8 million for 2008, and $1.5 million for next year, according to the tribe, which has released a list of cost cutting measures that its chairman and board of directors have put in place.

Chairman Joe McCoy and the tribal board reported their progress to tribal members in the October 3 issue of the tribal newspaper, Win Awenen Nisitotung.

"Several changes have been made, including elimination of non-essential positions, suspension of employment benefits, suspension of membership services, and elimination of satellite health clinics," Mr. McCoy wrote in the October 3 report. He stressed that many of the changes will be temporary. "In addition, there will be no supplementation of the annual elders fund. The decisions that have been made, and that will continue to be made until we zero out the deficit, have not been easy for the board members and executive staff. The condition of our tribe's finances have been deteriorating for several years; making changes is necessary to regain financial stability."

A projected deficit of $15 million for 2008 had already been reduced to $7.9 million through cost-cutting measures implemented September 11, Mr. McCoy announced on that date. Bringing the budget in line with actual available revenue is the top priority, he said.

"For 2008, we still have an $8 million deficit," Mr. McCoy reported October 3, and "are pursuing a $5 million loan to help with 2008, and we are borrowing internal fund reserves to assist in balancing out at the end of the year. For 2009, with the numerous changes made to date, we are at approximately $1.5 million deficit."

The tribe operates five casinos and 22 businesses in the Upper Peninsula and provides health care, housing, and other services to its members in the eastern and central U.P. The top three tribal membership priorities are health, education, and services for elders, Mr. McCoy has said.

"Our casinos have also been impacted by our financial situation," he reported last week. "There have been many budget and cost cutting measures implemented throughout the five northern casinos over the past several months. These changes, although difficult, were necessary. With the current economic conditions, our revenues have not shown any significant gains in recent years, while our expenses have continued to escalate, resulting in a weaker bottom line. There have been $4 million in overall reductions within our casinos and enterprises, which will assist in relieving some of the bank requirements, as well as allow us to demonstrate that we can operate more efficiently and perform at a higher level. This will enhance the opportunity for us to invest back into our businesses, moving forward in a positive direction."

Income from the tribe's casinos, which the tribe relies on to provide services to members, is down, he said.

"Casino revenues have decreased due to increased competition and downturn in the state and national economy. . . . As it stands today, with bank restrictions and other requirements, our tribe anticipates $17 million in revenue for the next two years from our casino profits. These funds are intended for governmental purposes, including costs of operations and providing membership services. At the same time, . . . the board of directors has directed our management team to develop revenue projections and plans for increasing our bottom line revenues."

Mr. McCoy's report outlined other funding sources that help the tribe provide services.

"Currently, we receive a number of grants and federal funds that assist in sustaining the level of services we offer," he wrote. "Sault Tribe's membership services budget for 2008 totaled $49,182,151. Of this amount, $22,356,980 comes from tribal sources, while we receive $26,825,171 for membership services from federal revenue sources (grants), Indian Health Services, Bureau of Indian Affairs, and state grants."

The following list summarizing the financial cuts to date is reprinted with permission from Win Awenen Nisitotung:

Sault Tribe Restructuring

Summary

Employment Benefits Suspended—

Casino: • Triple time and a half. • Shift triple time and a half. • Employee recognition program. • Team member picnics. • Christmas $50 gift cards.

• Personal days.

• Extended NGS eligibility period from 12 to 18 months.

• Good Friday as casino holiday pay.

• Perfect attendance.

• Holiday pay for those not scheduled to work.

• Reducing employee cafeteria hours.

Governmental Department and Tribal-wide Cuts —

• Suspended the 2% match for 401K program - tribal wide.

• Suspended year-end vacation cash outs (Law Enforcement exempted).

• Suspended conversion of sick time to vacation time tribal wide.

• Suspended $50 gift card to elders, governmental.

• Suspended $50 Christmas bonus to employees tribal wide.

• Suspended $50 Christmas gift to committees, governmental.

• Suspended 3.5% pay increases tribal wide.

• Extended eligibility period for NGS from three months to six months, governmental.

Positions Eliminated or Refactored —

Casino:

• Refactored two positions in Sault Casino Accounting Department.

• Eliminated two positions in Sault Casino Accounting Department.

• Christmas Casino: Eliminated 11 positions; one was vacant.

• Hessel Casino: Eliminated one position.

• Manistique Casino: Eliminated eight positions.

• Sault Casino: Eliminated 25 positions; four were vacant and one was vacated due to retirement.

• St. Ignace Casino: Eliminated 12 positions; one was vacant

Governmental/Internal Service —

• Internal Services: Eliminated 34 positions, seven vacant.

• Membership Services: Eliminated 38 positions, eight vacant.

• Membership Services: Reduction in hours, six positions.

• Internal Services: Refactored three positions.

• Membership Services: Refactored two positions.

Membership services suspended —

• Elders' meal programs - Sault Site: suspended Friday meal.

• Closed several satellite tribal health clinics.

• Eliminated tribal subsidy for All-in-One Fitness Center - fee schedule is in place.

• Suspended the 2008 special events budgets - includes community wide children's Christmas parties.

• Suspended Youth Development Fund.

• Suspended youth sponsorships.

• Suspended tribal support supplemental Contract Health Program.

• Suspended Elders' Committee Recreation Funds.

• Suspended intern program.

• Suspended governmental team member picnics.

• Child Care Center $5 subsidy: Eliminated this as only those above income guidelines qualified for it.

• Chi Mukwa Recreation Center: Suspended conference attendance, training, purchase of equipment, Billy Mills travel costs, Running Club, Family Olympics, closed one day between Memorial and Labor Days.

• Eliminated one issue of tribal newspaper, from 13 to 12.

• Eliminated taping of board of directors workshops.

• Board of directors: eliminated costs for parking permits, FYI mailings, copies of meeting tapes, lunch reimbursements, chairman's town meetings, unit meeting expenses, installation party after elections, stipend for staff carrier, and, although the board has not received a pay increase, due to the way our budgeting disks are formatted, all budgets have a built in 3.5% increase; this was taken out of the board's budget except for the staff paid from this budget.

• Suspended "The Shed" Teen Center on the Sault Reservation.

Other — Casino:

• Changed token program.

• Significantly reduced capital expenditures budget.

• Eliminated 2008 outdoor concert - Sault casino.

• Law Enforcement meals no longer comped (per Law Enforcement request).

• Re-negotiated slot participation fees.

• Eliminated St. Ignace Entertainment.

• Reduced contract amount for marketing consultant.

Governmental/Tribal-wide:

• Suspended the George Snider weekly radio program.

• Suspended the Sault Tribe This Week radio program.

• Suspended internal loan repayments, except for Land Claims Fund.

• Took action to eliminate filling positions unless essential to operations.

• Suspended all travel unless essential to operations and/or grant funded.

• We have been able to reduce some tribal support budgets due to receiving an increase in federal and/or state grant dollars.

Enterprise - • DeMawating Development: Eliminated four positions.