By JONAH LOSSIAH
One Feather Reporter
The Tribal Council of the Eastern Band of Cherokee Indians (EBCI) passed Ord. No. 369 (2022), which will allow for the creation of the General Welfare Exclusion (GWE) Program.
This will be an optional alternative to per capita, the semi-annual distributions provided to every enrolled member of the EBCI. The primary difference between per cap and GWE is that GWE distributions would be exempt from federal income tax.
A substitution was offered during Tribal Council’s Thursday, Dec. 8 session. Michael McConnell, EBCI attorney general, was the first to speak for the ordinance.
“I just want to explain why there are more pages now than there were before. As you leaf through it, you’ll actually see that the red lines, there aren’t too many,” said McConnell.
“We did have a work session on this. Ken Parsons, our outside attorney, we worked with him trying to be very careful about the different sections that we needed to reach into to open the door to the Tribe introducing a General Welfare Exclusion Program. This will allow tribal members to receive qualifying distributions tax-free. So, it can be a big benefit to the Tribe.”
McConnell said that along with Parsons, his office has been cooperating with Jay Gallinger and EBCI Secretary of Treasury Cory Blankenship. He said that there is no external deadline for passing the item but said that the sooner the Council can make a decision the better. He explained that once implemented, it would not affect distributions until next year.
Principal Chief Richard G. Sneed was the next to offer his insight on the proposed program.
“Just for the logistical part, if this ordinance is accepted – voted on and passed, we would then do an open enrollment. Tribal citizens could choose to remain in the regular per capita distribution as it is now, nothing would change. Or if they chose to sign up for the General Welfare Exclusion program, as stated in the ordinance: General Welfare Exclusion shall mean the laws and policies written and adopted by the Tribe to provide a mechanism for providing benefits to eligible tribal members in compliance with revenue procedure 2014-35 of the US Internal Revenue Service – So the benefits will be treated as tax exempt. So, distributions of GWE – the dollar amount of the original distribution stays the same as per capita, it’s just tax exempt.”
He said that starting as soon as the next June distribution, those who sign up for the GWE program would be receiving the full distribution with exemptions from all federal Income Tax.
Big Cove Rep. Teresa McCoy stated her support for the ordinance but said that it was critical that all the questions in the community be cleared up soon.
“One of the biggest questions that I still get on this issue is, when can I have my money out when I choose to take it out. That’s the only concern I seem to be hearing. I would hope that we have some more information granted on this. Because that’s one of the meetings I’m going to request for Big Cove in January when it’s calm and quiet. That we have everybody come back up and explain it to us one more time just so that we’re sure. I just want Council and Executive and the Tribe to know that I’ve had a lot of questions on this GenWel issue,” said Rep. McCoy.
Chief Sneed said that he understands that there is confusion, but essentially the base of this change is only around the taxes. Any other features involved will be optional and down the road.
“I think where the confusion is coming from is when we talked about this early on in a work session, Cory had mentioned that if you fully expanded the GWE program, we could set it up so that we could essentially do bill pay. The Tribe could pay your mortgage payment for you. Utility bills, etc. The initial roll out isn’t going to look like that at all. The initial rollout is essentially the two programs will be stood up side-by-side. Per capita is already established, GWE would be stood up beside it. If you sign up for it, you get the full distribution, we’re not holding onto anything. You get the full distribution, it’s just tax exempt. Then, once everyone that wants to be in it is in it, you can stay in that framework where you just get the distribution. Or if we expand the program, what we’ve looked at are essentially debit cards that we could load. Then, they could have a debit card or we could do bill pay. But those are options that you have to sign up for later. That’s not established.”
Only one member of the horseshoe didn’t give a full vote of confidence for this proposition, and that was Snowbird/Cherokee Co. Rep. Adam Wachacha.
“I know there is a lot of hesitation in some sections of looking at this. I know I’ve not been able to answer a lot of the questions pertaining to tax brackets. Like different individual families that are considered high median income. I guess the comfort level isn’t there and I’m not ready to pass this without at least another work session or maybe having individuals come out to community clubs to explain and answer the questions a little more. I’m not opposed to it. I think it’s a great opportunity, but I think the public just needs to have a little more comfort level.”
It was reiterated multiple times that this program will be optional. Vice Chief Alan B Ensley also provided his thoughts on the program. He said there is plenty of work to be done, but that it would be best to get the ball rolling.
“I support this. From the very first per cap check we got we’ve been wanting to do something that would exclude us from having to pay taxes on it. I think this is a good way to get there. I told the Chief I was going to ask the Council to go ahead and approve it if they want to. He’s got 30 days to sign it. He said he’d be willing to wait to that 30th day to give time for us to get out to the community clubs. Have more work sessions or whatever. The key to this is its optional. It ain’t something we’re mandating on people,” said Ensley.
Painttown Rep. Dike Sneed made a motion to pass this ordinance, and Vice Chairperson Albert Rose offered a second. 9 of the 10 council members voted in favor, passing Ord. 369 (2022). Rep. Wachacha chose to abstain from the vote.
