EBCI Council tightens transparency rules for tribal LLCs

BY HOLLY KAYS STAFF W RITER

In response to what he says are ongoing issues with transparency on the part of the tribe’s cannabis business Qualla Enterprises LLC, Eastern Band of Cherokee Indians Principal Chief Richard Sneed introduced an ordinance during the July 13 Tribal Council session clarifying certain aspects of the relationship between tribal government and its LLCs.

After about 20 minutes of discussion, Tribal Council offered unanimous approval. The ordinance awaits Sneed’s signature to become effective.

“This is directly related to my repeated requests of Qualla Enterprises for financial documents, for a budget, for a fiscal management policy, for invoices, for information on payroll, etc., none of which have been fulfilled at this point,” Sneed told Tribal Council. “I’ve asked for three months now for documents. I was informed by the board that they’re not required to provide those.”

The ordinance governing tribal LLCs states that Tribal Council can inspect and copy LLC records but does not make the same provision for the principal chief and vice chief. Sneed’s ordinance adds these executive offices to the list of those who can request records. The initial version said LLCs would have five days to produce the records, but after Council approved an amendment proposed by Yellowhill Rep. T.W. Saunooke, the final version states that LLCs have five days to either produce the records, or to provide a reason why more time is needed, along with a date by which they would be provided.

The ordinance also includes new provisions regarding tribal government oversight of its LLCs and distributions of LLC profits.

Under the new ordinance, LLCs in which the tribe or a tribal entity are the sole initial members may not add or change members without a resolution from Tribal Council that has either been signed by the principal chief or allowed to pass into law without a signature.

Additionally, the ordinance states, any such LLC will be considered a “component unit” of the tribe and must comply with its audit requirements. During a May Tribal Council session, Qualla Enterprises Chair Carolyn West and EBCI Finance Director Brandi Claxton had argued over whether the LLC was considered a component unit and therefore required to submit an annual audit to the tribe. West F