Zoom Virtual Training Re-Opening Amidst Covid-19 Considerations and Updates Wednesday, May 27, 2020
Training Material
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Re-Opening Amidst Covid-19 Considerations and Updates June 10, 2020 ZOOM VIRTUAL TRAINING Session begins 9:00 PST, 10:00 MST, 11:00 CST, 12:00 (Noon) EST AGENDA (Subject to Change)
Part 3 “Sustaining our Communities, Tribes and Families” • Welcome: Ernie Stevens, Jr., Chairman , National Indian Gaming Association • Overview from Part: Billy David, Owner/Lead Consultant, Bo-Ko-Pa & Associates • Panel Discussions: Opening your Tribal Casino Panel Discussion (45 minutes) What tribes experienced or are experiencing as they open for business Moderated by Billy David , Owner/Lead Consultant, Bo-Ko-Pa & Associates Panel: • Colista Eagle, Interim CEO, Shoshone Bannock Casino Hotel • Klint Nephew, Vice Chairman at Seneca Gaming Corporation Board of Directors
• Economic Forecast for Recovery: Jim Klas, KlasRobinson
• COVID-19 Protections: Walt Lamar, Owner, Lamar & Associates
• Industry/Legislative Updates: Jason Giles, Executive Director, National Indian Gaming Association • Closing Remarks – Seminar Series: Danielle Her Many Horses, Deputy Director/Legal Counsel, National Indian Gaming Association
Thank you for your participation
FORECAST FOR RECOVERY
June 10, 2020
THE GOOD OLD DAYS
HISTORIC GAMING REVENUE COMPARISON – 2009 to 2018 (dollars in $billions)
Source: American Gaming Association, National Indian Gaming Commission and
COVID-19
PANDEMIC ASSUMPTIONS - Substantive Effects End May 2021 - Substantive Restrictions End June 2021 - One or Two More Peaks
- Total U.S. Cases = 5.6 million - Total U.S. Deaths = 224,000
GENERAL ECONOMIC EFFECTS
INDIAN GAMING
REVENUE FORECAST
- 34.25 PERCENT GAMING REVENUE DECLINE - 38.85 ANCILLARY REVENUE DECLINE - PARTIAL RECOVERY 2021 - NEARING COMPLETE RECOVERY LATE 2022 - RECOVERY & GROWTH LATE 2023
THE BOLD NEW DAYS
REOPENING PHASES (variable timing & periodic retrenchment)
Initial (June to December) Ad Hoc Changes Experiment & Adjustment More Intensive Restrictions
Transitional (October to September 2021) Semi-Permanent Spacing Changes Ancillary Reopenings Increased Capacity/Fewer Restrictions Recovery (September 2021 to Early 2023) Permanent Spacing Changes & Possible Expansion All Ancillary Facilities Open in Revised Forms Beginning of Evolution of New Patterns
DEMAND PATTERNS
- Local Demand - Drive-in Demand - International Last - Possible Short-Term Bumps
FACTORS AFFECTING PERFORMANCE
- Average win/visit (high vs. low) - Utilization (high vs. low) - Governmental Restrictions - Area Employment - Local Hot Spots - Oil, Ethanol, Non-Grain Farming, Intl. Trade - Non-Tribal/Non-Gaming Tourism - Capital Access
Q & A WATCH FOR WHITE PAPER: HEALING TRIBAL ECONOMIES RELEASE DATE: JUNE 15
HEALING TRIBAL ECONOMIES A PROGNOSIS AND PRESCRIPTIONS FOR ECONOMIC RECOVERY FROM COVID-19 IN INDIAN COUNTRY JUNE 2020
To our clients and friends in Indian Country and all working to improve the economic future for Native American people: KlasRobinson Q.E.D. is pleased to present the accompanying white paper entitled: “Healing Tribal Economies – A Prognosis and Prescriptions for Economic Recovery from COVID-19 in Indian Country." The current COVID-19 pandemic has resulted in unprecedented upheavals in economic conditions in the U.S. and around the globe. Indian country is uniquely vulnerable, both to the disease itself and to the public health measures required to contain its spread. With higher rates of various comorbidity factors, less robust healthcare systems, and dependence on tourism, agriculture, extraction and federal transfers to fund government services, tribes face threats from the pandemic on multiple fronts. At the same time, information on the course of the virus and estimates of the impacts of its ravages and of the mitigation efforts employed to combat it are limited, incomplete and often contradictory. The disease itself, and the steps taken to fight it, are simply too new and variable to provide clarity and consistency in data and analysis to guide tribal leadership. Nevertheless, the need for immediate action and for planning for long-term recovery forces tribal leaders, like leaders at all levels, to make choices based upon the best information and analysis available, however imperfect it may be. Within that context, our goal in this white paper is to sift through the various information sources and preliminary predictions being offered and construct a framework for understanding the most likely outcomes and best plans of attack. Our hope is that this work will provide tribes with more than simply another set of predictions, but also the analytical discussion to be able to draw their own conclusions in developing plans for their people and adjust those plans over time as new data becomes available. To do this, we have taken our more than 30 years of experience forecasting future outcomes for more than 250 tribes and applied it to this very troubling situation to give our best estimates and recommendations for tribal economic recovery from COVID-19. One thing we know for sure: as bad as this is, tribal leaders have weathered far more severe storms throughout history and will survive the current crisis to continue to protect their cultures and their people. KlasRobinson Q.E.D.
James M. Klas Founder & Principal
Matthew S. Robinson Founder & Principal
HEALING TRIBAL ECONOMIES A PROGNOSIS AND PRESCRIPTIONS FOR ECONOMIC RECOVERY FROM COVID-19 IN INDIAN COUNTRY
Cover Letter
TABLE OF CONTENTS
PAGE
INTRODUCTION EXECUTIVE SUMMARY
GENERAL ................................................................................................ 5 PROGNOSIS............................................................................................ 5 PRESCRIPTIONS .................................................................................... 7 MONITORING FUTURE HEALTH.......................................................... 18 PROGNOSIS GENERAL .............................................................................................. 22 COVID-19 AND CIVIC RESPONSE ....................................................... 22 GENERAL ECONOMIC CONDITIONS .................................................. 32 TRIBAL ECONOMIES ............................................................................ 52 SUMMARY ............................................................................................. 93 PRESCRIPTIONS GENERAL .............................................................................................. 96 PRESCRIPTIONS ACROSS SECTORS................................................ 96 INDIVIDUAL SECTOR PRESCRIPTIONS ........................................... 108 MONITORING FUTURE HEALTH GENERAL ............................................................................................ 129 COVID-19 AND CIVIC RESPONSE ..................................................... 129 GENERAL ECONOMIC CONDITIONS ................................................ 131 TRIBAL ECONOMIES .......................................................................... 133 SUMMARY ........................................................................................... 136 ADDENDUM: PROFILE OF KlasRobinson Q.E.D.
HEALING TRIBAL ECONOMIES A PROGNOSIS AND PRESCRIPTIONS FOR ECONOMIC RECOVERY FROM COVID-19 IN INDIAN COUNTRY
INDEX OF CHARTS
PAGE
Tribal Economic Prognosis Summary Top 10 Countries by Total Cases Confirmed: May 27 Top 10 Countries by Total Deaths: May 27 Fatality Rate as of May 27 (All Countries with 20,000+ Cases) Deaths per 100,000 as of May 27 (All Countries with 20,000+ Cases) U.S. Gross Output Average Compound Annual Growth: 2010-2019 Annual Unemployment Above 10.0 Percent vs. April/May of 2020 Forecast Change in GDP and Relation to 2019 Level Percent of Total U.S. Establishments AIAN-Owned by Sector – 2007 Percent of Total AIAN-Owned Establishments by Sector Length of Economic Cycle in Months Forecast Unemployment and Inflation Rates Percent of Total U.S. Establishments by Sector Percentage of Establishments on the Reservation by Sector Percentage of Establishments by Sector off the Reservation Percentage of Total Jobs by Sector on the Reservation Percentage of Jobs by Sector off the Reservation Historic Gaming Revenue Comparison – 2009 to 2018 FY 2018 Indian Gaming Revenue Distribution by Region (table) FY 2018 Indian Gaming Revenue Distribution by Region (map) Actual, Estimated and Forecast Indian Gaming Industry Revenue: 2017-2022 Forecast Change in Non-Casino Tourism, Lodging & Leisure Revenue from Prior Year & Comparison to 2019 Forecast Change in Tribal Agriculture Revenue from Prior Year & Comparison to 2019 Forecast Change in Tribal Mining & Extraction Revenue from Prior Year & Comparison to 2019 Forecast Change in Tribal Construction Revenue from Prior Year & Comparison to 2019 Forecast Change in Tribal Manufacturing Revenue from Prior Year & Comparison to 2019
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23 23 23 23 33 36 40 49 51 53 54 54 56 56 57 57 60 60 61 68
71
75
77
80
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HEALING TRIBAL ECONOMIES A PROGNOSIS AND PRESCRIPTIONS FOR ECONOMIC RECOVERY FROM COVID-19 IN INDIAN COUNTRY
INDEX OF CHARTS (continued)
PAGE
Forecast Change in Tribal Wholesale Trade Revenue from Prior Year & Comparison to 2019 Forecast Change in Tribal Retail Trade Revenue from Prior Years & Comparison to 2019 Forecast Change in Tribal Transportation & Warehousing Revenue From Prior Years & Comparison to 2019 Forecast Change in Tribal Revenue from Other Sectors from Prior Year & Comparison to 2019
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Gaming Space Return Requirements
110
INTRODUCTION
The current COVID-19 pandemic has resulted in unprecedented upheavals in economic conditions in the U.S. and around the globe. Indian country is uniquely vulnerable, both to the disease itself and to the public health measures required to contain its spread. Tribal populations have higher rates of obesity, heart disease, diabetes and other health conditions that are known to increase the risk for more severe cases of COVID-19 and even death. Most tribes are located in rural areas and served by healthcare systems that are ill equipped to handle massive case surges and more complex treatment requirements. The combination of such risk factors has been shown to intensify the crisis for some tribes, most notably the Navajo Nation. The odds are strong that similar problems will develop across more of Indian country as the disease progresses. In the face of the public health crisis, tribal leaders, like leaders at all levels, have focused their efforts primarily on mitigation of the spread of the virus. Every Indian casino in the country has closed for extended periods. Along with casino closings, closures of other tourist attractions and cancellation or postponement of events have decimated the tribal tourism industry, one of the key economic drivers for tribal economies and sources of funding for tribal governments. Other key funding sources have also been hit, including mining and extraction industries and agriculture. While government funding has remained in place and is being supplemented by specific funding from the CARES act, the magnitude of the deficits being created at federal and state levels causes real concern for future funding levels. In anticipation of the point in time when the health crisis will have passed but with little certainty of when that will occur, tribes are already formulating plans and taking steps to mitigate and recover from the economic devastation caused by the pandemic and steps to fight it. The first Indian casino reopened on May 1 st , with others gradually following suit or preparing to do so in the near future. Tribal leaders are leveraging sources of public and private funding to provide for the needs of their people hit by loss of employment and income, as well as by medical conditions directly or indirectly related to the crisis. As in private industry, tribal industries are revamping their operations and attempting to control their costs to allow for the fastest and most complete recovery possible as public health directives permit. One of the greatest challenges for tribal leaders in dealing with the current crisis and planning for future physical and economic recovery is the lack of clear, consistent and timely information and analysis. There is no statistic, not cases, deaths, tests, death rates, recovery rates, demographic profiles, GDP declines, unemployment rates, or any projections of future levels thereof, that provides the level of clarity and consistency needed. The numbers change daily and are often contradictory, alternately lending support to or undermining otherwise credible, plausible and well-meaning projections and recommendations.
∴ INTRODUCTION
2
This is not meant as a criticism of any particular reporting mechanism, measurement or forecast. While legitimate weaknesses and outright errors exist, the primary problem is in the nature of the crisis itself and of our length of experience with it. It is simply too soon and the conditions remain too vulnerable to the caprices of the virus and to the decisions by everyone from leaders at the highest level to individual tribal members. It is literally not possible at this point to have a clear and consistent picture of either the health or the economic impacts of the pandemic and the mitigation efforts to contain it. Unfortunately, that does not change the need for leaders to make decisions right now and to plan for the future, however unclear. It also does not change the need for experts in the relevant fields to apply their skills, experience and best judgement to advise those leaders and the general populace to the best of their abilities. This problem is not new and is not without methods for approaching solutions. Forecasting and decision making with imperfect information, even in volatile periods, has been a subject of intense study for a long time and great advances have been made at the theoretical and practical levels that make possible useful frameworks for analysis, prediction, planning and direct action. Despite the uncertainty, there can be confidence that experienced professionals and capable leaders using appropriate methods can reach conclusions and take effective steps that will ultimately come closer to the conclusions and steps that would have arisen from perfect and consistent data. In other words, conclusions and steps that will leave their economies and people in the best possible position when the crisis recedes. KlasRobinson Q.E.D.* specializes in analyzing the financial feasibility and economic impact of Indian gaming and economic development on tribal lands. Over more than thirty years, the principals of KlasRobinson Q.E.D. have worked with more than 250 tribes throughout the United States and Canada. This white paper has been created in an effort to apply that experience and perspective to the current crisis in all of its maddening complexity and volatility to equip tribal leaders and anyone who works to improve the economic health and well-being of Native America with a framework for short- term decision making and long-term planning. The analysis is organized into two main sections as suggested by its title. The first section is a prognosis for tribal economies that discusses the current conditions and forecasts the most likely outcomes going forward. The second section is a set of prescriptions for tribal leaders and the managers of their primary economic developments to assist in the economic recovery process. A final adjunct lists possible positive and negative variables that should be monitored to identify the potential for outcomes that vary from the forecasts made and adjust the strategies employed, along with some suggestions for the best means to track those key variables. Throughout the paper, we will attempt to provide sufficient discussion of the reasoning behind the forecasts and recommendations to allow the reader to make adjustments in the future as new information becomes available.
* KlasRobinson Q.E.D. has considerable experience in analyzing tribal economic development. For a profile of the company, please see our website at www.klasrobinsonqed.com
∴ INTRODUCTION
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EXECUTIVE SUMMARY
GENERAL
This section describes, in brief, the findings and conclusions derived from our analysis of the effects of the COVID-19 pandemic and associated mitigation efforts on tribal economies. This overview includes our assumptions for the course of the pandemic and our forecasts for tribal economic damage and recovery. However, the estimates presented, along with the information in this section as a whole, are meant as a summary of, not a substitute for, the body of the report, which contains additional information and detail critical to a full understanding of the bases for the estimates made and the context within which they were formed.
PROGNOSIS
The severe disruptions from the global pandemic and from necessary efforts to mitigate its spread are already impacting the economies of Indian country and of the U.S. as a whole. Based upon assumptions about the length and severity of the pandemic and analyses of current and past economic conditions in crisis and recessionary circumstances, negative impacts across all sectors are expected for 2020 with varying but generally major degrees of severity. Negative impacts are forecast to continue in nearly all sectors in 2021 although recovery will begin in most cases. By the end of 2022 most sectors will be approaching full recovery or may have already reached it in some cases. However, certain sectors will not reach full recovery until 2023 or even later. We are not public health or behavioral health experts. We are dependent upon the available information and analyses of such experts to formulate our assumptions for the course of the pandemic. However, making such assumptions cannot be avoided as they will have significant impacts on the forecasts of economic effects and appropriate responses for tribal leaders. With that understanding, we assume a continuation of significant caseloads and deaths directly attributable to COVID-19 through the Spring of 2021, with an approximate total number of infections of 5.6 million in the U.S. with approximately 224,000 deaths, plus or minus a margin of error. Following that time, we assume that COVID-19 will cease to be a major determining factor in the economy, although the effects of its ravages and of the responses needed to control it will extend far beyond that date, as will be discussed. However, the ongoing caseload and death rate of the virus beyond that time is no longer assumed to be an imminent driver of the economy. The table on the following page present a listing of our forecasts for various sectors of tribal economies across the country. The experience of individual tribes will vary depending upon local circumstances and actions that their leaders and the leaders in their surrounding counties and states take. The discussion of the reasoning behind the forecasts in the body of this report should be consulted for any forecast of particular interest to any reader to ensure a thorough understanding of the significance and reliability of the figures presented in the table.
∴ EXECUTIVE SUMMARY
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TRIBAL ECONOMIC PROGNOSIS SUMMARY
2020 2021 2022
YEAR:
U.S. GDP: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL
-10.5% 7.7% 4.2% 89.5% 96.5% 100.5%
U.S. UNEMPLOYMENT RATE
10.2% 8.2% 6.7%
U.S. INFLATION RATE
0.5% 2.5% 3.1%
TRIBAL ECONOMIC OUTPUT BY SECTOR: INDIAN GAMING: YEAR-TO-YEAR CHANGE
-34.2% 18.6% 22.1% 65.8% 78.0% 95.3%
PERCENT OF 2019 TOTAL
OTHER TRIBAL TOURISM & LEISURE: YEAR-TO-YEAR CHANGE
-38.5% 22.6% 27.6% 61.5% 75.3% 96.1%
PERCENT OF 2019 TOTAL
AGRICULTURE: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL MINING: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL CONSTRUCTION: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL MANUFACTURING: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL WHOLESALE TRADE: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL RETAIL TRADE: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL
-18.0% 17.6% 4.5% 82.0% 96.5% 100.8%
-24.7% 16.4% 8.0% 75.3% 87.6% 94.6%
-5.0% -4.2% 1.0% 95.0% 91.0% 91.9%
-11.3% 11.0% 4.2% 88.7% 98.4% 102.6%
-17.0% 9.9% 7.0% 83.0% 91.2% 97.6%
-21.0% 8.8% 6.0% 79.0% 86.0% 91.1%
TRANSPORTATION & WAREHOUSING: YEAR-TO-YEAR CHANGE
-2.0% 9.9% 2.0% 98.0% 107.7% 109.8%
PERCENT OF 2019 TOTAL
OTHER ECONMIC SECTORS: YEAR-TO-YEAR CHANGE PERCENT OF 2019 TOTAL
-7.1% 6.3% 2.8% 92.9% 98.8% 101.6%
SOURCE: KlasRobinson Q.E.D.
∴ EXECUTIVE SUMMARY
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PRESCRIPTIONS
There are already a plethora of checklists, model procedures and minimum operating standards available for businesses off all types, many of which were necessary to allow for initial reopening attempts or to maintain essential operations. These have been developed by various governments, industry and trade groups and individual operators and consultants. It is not our goal to duplicate those efforts. Our focus in this section is to provide practical recommendations based upon anticipated trends to guide and enhance the recovery process across Indian country and all of its economic sectors. The recommendations and the ideas underlying them are not presented as comprehensive, exhaustive or completely original. They are a compendium of our own analyses, best practices already being observed and extrapolations of likely refinements in initial steps designed to give a broad and high-level framework to assist tribal economic recovery. The recommendations are summarized below by bullet point. Additional discussion of the reasoning behind and meaning of the recommendations is presented in the body of this report. RECOVERY PHASES Initial Phase (June to December 2020) Watching for promising new ideas and approaches taken by others and implementing them quickly Maintaining close communication with employees, customers and government, including both listening and informing, to minimize confusion and maximize the compliance with and benefits of any steps taken Monitoring actual versus expected results and not hesitating to change or revoke steps that do not produce desired results Publicizing the steps you take widely Planning in advance for retrenchment in the event of a viral surge Planning in advance for the next round of actions to take as conditions improve and restrictions are eased Careful evaluation of costs versus benefits to inform future revisions Avoidance of the language of failure or error and instead focusing on language of learning, refinement and evolution Transitional Phase (October 2020 to September 2021) Continuing to watch for promising adjustments and approaches taken by others and applying them to your own environment Using operating results, customer and employee feedback and revised government directives to inform easing or adjusting of rules. Taking initial steps to make temporary structural changes permanent as needed
∴ EXECUTIVE SUMMARY
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Experimenting with internal design and materials to improve the comfort, efficiency and appearance of barriers and spacing requirements Planning in advance for long-term adjustments in space, product lines, pricing, staffing and business models to reflect the clearer picture of the evolving “new normal” Publicizing and celebrating successes, enhancements and easing of restrictions Personalizing the evolving long-term operating patterns to your particular business and customer base Recovery Phase (September 2021 to Early 2023) Resumption of traditional rather than emergency strategic planning to maximize market position and profitability Continued communication with customers, employees and civic leaders. More significant capital expenditures to maximize the efficiency, customer appeal and profitability of operations A resumption of traditional government advocacy to refine, improve, add or remove post-pandemic regulations Exploration of new business lines, cross-fertilization, vertical and/or horizontal integration and other opportunities in the new economic environment given your own internal strengths and weaknesses Document all actions taken during crisis and recovery, including what worked and what did not to provide a guide for future crises
INTER-TRIBAL COOPERATION & COORDINATION Association/Organization to Association/Organization
Formal coordination through regular meetings of key staff in major national and regional organizations (e.g. NIGA, NCAI, NCAIED, American Indian Chamber of Commerce, NAFOA and many others, including their regional counterparts) to set agendas, monitor progress and share ideas and areas of emphasis Development amongst the organizations of standardized messaging, phrasing and key words applicable to area of common interest as well as to areas of individual emphasis (e.g. the word “sovereignty” which has become an extremely effective rallying cry across numerous issues) Continued and enhanced joint appearances before government agencies and elected officials and invitations to such to appear at joint gatherings
∴ EXECUTIVE SUMMARY
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Coordinated public relations efforts in the media and at state and local levels in addition to the federal government to highlight the areas of common concern and engrain the standardized phrasing and key words into the public lexicon Regular reports back to their own individual memberships regarding their coordination efforts to boost enthusiasm and support at the tribal leader and tribal member level Leverage associate member knowledge and resources to boost impact Tribe to Tribe Development of consortiums between land-rich, labor-rich, resource- rich and financially successful tribes to develop new business ventures capitalizing on shifting trade and supply chain patterns, with development located to maximize needed employment or market/resource access with investment from tribes lacking such needs or opportunities but having cash available for investment Continued and expanded lending and investment tribe-to-tribe for renovation and expansion of existing facilities to meet new operating requirements as recovery takes hold Continued joint efforts to support needy Native Americans not living on their home reservations Continued, renewed or expanded support by individual tribes for the multi-tribal organizations and associations previously referenced Increased efforts to make inter-tribal purchases, whether tax- advantaged or not, and support Indian-owned businesses SUPPLY CHAIN DIVERSIFICATION Internal review of all vendor sourcing across all tribal businesses to identify and develop additional reliable and high-quality sources Encouragement of, investment in and directed purchasing from existing and new AIAN-owned suppliers Reevaluation of customers and product/service lines to identify opportunities for additional direct or spinoff/leveraged markets, including increased tribe-to-tribe selling Lobbying and pursuit of government grants, loan programs and other incentive programs to support new, expanded or diversified production and distribution Active discussions at the association level and tribe-to-tribe of networks and consortiums to aid supply chain diversification Strategic planning and investment with a focus on longer return cycle development to allow new diversifying business ventures time to establish their markets
∴ EXECUTIVE SUMMARY
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Further exploration of tax advantages and other regulatory benefits of tribal development and tribe-to-tribe transactions, as well as tribe to non-tribal sources, to market and support new diversification efforts. FINANCING & WORKOUTS Internal working groups as quickly as possible given crisis conditions to begin a pre-planning process looking at likely issues and areas of focus unique to each tribe and tribal business As time, capital and staffing permits, initiation of business level and tribal level strategic planning for recovery and future long-term operating models On-going communication with existing and past lenders to establish dialogue about needs, limitations, expectations and opportunities Project, loan or venture specific evaluation of pre-pandemic, pandemic and likely post-pandemic operating results given available information and current plans, including range and alternative estimates Active discussions at the association level and tribe-to-tribe of alternative capital sources, workout strategies and best practices Continued lobbying of government support for reparative, restorative and generative initiatives INSURANCE & LEGAL Immediate discussions with internal and external counsel, as well as relevant industry associations and government representatives to determine the extent and character of liability for Indian tribes and AIAN-owned businesses across all sectors Negotiations with insurance providers regarding policy coverage and disbursement procedures to identify areas of disagreement and begin the claims filing process Documentation of all necessary actions taken, operating or practical results, government guidance, communications and publicity efforts to create a paper trail in the event of litigation Review and enhancement of publication and communication of all relevant policies, regulations and declared liability limits to customers, employees, vendors and tribal members SANITATION, PPE AND OTHER HEALTH PROTECTIONS Active pursuit of diversified supply lines for all sanitation, PPE and other health protection supplies, including development of tribal production for internal use and external sale where feasible
∴ EXECUTIVE SUMMARY
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Study and monitoring of enhancements to improve the comfort of PPE for employees and customers without losing effectiveness Analysis of interior design standards to make distancing and barriers for customers and staff, both front-of-house and back-of-house, more attractive, less intrusive and more convenient/efficient Segmentation of customer and work groups into smaller clusters where possible to reduce potential spread, either through space designation, activity/process segregation or scheduling Identification of key customer groups for special attention that can be attracted by providing added protection versus the general population Active discussion at the association and tribe-to-tribe level of innovations, best practices and supply sources Frequent reevaluation of the placement and types of sanitizing equipment to ease and enhance customer and employee usage and decrease the cost and time needed to refill, replace and dispose of spent materials Customization of PPE with logos, names and other marketing material for sale or free distribution as appropriate to staff and customers Active training of staff on engagement with customers and each other to encourage cooperation in policies and procedures in a non- confrontational manner with clear chains of command for reporting or enlisting aid in situations of non-compliance Pursuit of opportunities to provide sanitation and PPE supplies with logos on a charitable basis to people or institutions in need Automation of dispensing, tracking, and resupplying of sanitation and PPE wherever possible AUTOMATION Conversion where possible to touch-free processes, particularly in restrooms, entrances and other places where motion sensing is practical Conversion where practical to automated dispensing from supplies, to products, to currency/change, to PPE, to liquids, to raw materials and to any other potential machine dispensable item or service Training for staff on the proper use and maintenance of automated equipment and dispensers Education and promotion for customers on the use and benefits of automated equipment Inclusion of added automation in any redesign, renovation, expansion or new development to the extent allowed by space, capital and market position
∴ EXECUTIVE SUMMARY
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INDIVIDUAL SECTOR PRESCRIPTIONS Gaming Space Use and Needs
Planning and design efforts to create permanent distancing and barriers that are attractive to the customer, durable and easy for staff to work with and maintain. Evaluation of the cost/benefit of additional space for gaming and of reallocation of space from areas no longer utilized to the same degree. Evaluation of the most efficient and cost-effective manner to increase back-of-house space to meet employee and inventory needs Creative engagement with machine and table game vendors to develop new gaming stations that compensate for space requirements by reducing the need for customers to leave their gaming position Creative engagement with regulators to develop new MICS and testing to adapt to new gaming station models Reevaluation of the balance between various casino resort components to ensure that each component is properly scaled to meet the needs of the new operating environment, including greater design flexibility to quickly adapt space use in the future Consideration of shifts to electronic and/or stadium gaming for table games High Value Customers Configuring of private gaming salons for exclusive use by high-value gamers or for rental by groups. Salons would have dedicated servers and premium food and beverage offerings. With advance reservations, specific games could be moved in and out until such time as multi-game stations are developed Reconfiguration of players’ club benefits to focus even more intensively on higher-value gamers and reduce incentives to bottom level gamers Creation of “gaming concierge” staff for top tier customers to ensure that they have the games they want when they want them, guide them to the right locations personally when they arrive and cater to such other needs as they may have Adjustments to table minimums, and machine minimums to emphasize higher wagering levels per customer, even at the cost of some lower value patrons Creative engagement with regulators to develop/adjust regulations as needed to accomplish above goals.
∴ EXECUTIVE SUMMARY
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Food and Beverage Service Design and operational planning for increased food and beverage service on the gaming floor, including necessary regulatory changes, ordering equipment, space to set food and drinks and shifts in staffing Reconfiguration of buffets and other underutilized restaurants and bars to food court or food hall concepts or other space needs Shifting of menu mixes to ease the transition to on-floor consumption but maintain quality and freshness Increases in outdoor dining and drinking areas where space and climate permit, including increased climate buffering efforts such as awnings, heaters, coolers/misters and windscreens Adjustments to marketing efforts and players’ club rewards away from discounted food and beverage Premium food and beverage service for high-value customers and private gaming areas. Enhanced room service for casinos with hotels and increased packaged food vending and microwavable or kitchenette-preparable food Other Gaming Prescriptions Increases in the non-smoking space in casinos or transition to smoke-free to reduce the need for customers to remove their masks Increased active pursuit of on-line gaming options and non-wagering game apps associated with individual casinos for play both on and off property to ensure that Indian gaming maintains parity with opportunities available to commercial casinos and state-sponsored gaming Reevaluation of the cost/benefit of large-scale entertainment and sporting events on site to reflect new distancing requirements and new gaming capacities Proactive review of all gaming regulations, both internally and with state and federal agencies, to ensure that any unnecessary barriers to the evolution of the gaming experience in the post-pandemic environment are removed or mitigated Exploration of air handling and air filtering enhancements that can be marketed as increasing employee and customer health safety Review and alteration as needed of customer and employee access points to aid in capacity control and public health monitoring
∴ EXECUTIVE SUMMARY
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Tourism, Lodging & Other Leisure Industries Exploring options to expand RV and other camping sites, cabins, casitas, glamping or any other lodging options that stand independently or semi-independently Evaluation of renovation options to include kitchenettes or less extensive enhancements of in-room food preparation and consumption Enhanced room service and increased packaged food vending and microwavable or kitchenette-preparable food A shift in focus for lodging development toward lower price- point/lower service-point options such as economy extended stay Increases in outdoor dining and drinking areas where space and climate permit, including increased climate buffering efforts such as awnings, heaters, coolers/misters and windscreens Exploration of mixed/vertically integrated foodservice and retail models to provide more flexibility in the revenue stream Evaluation of the potential for increased outdoor or convertible indoor/outdoor activities and attractions Revision of staffing models through increased automation Where capacity cannot be maintained but demand is present, a shift upward in pricing to maximize revenue per patron, combined with increased amenities and upselling options Increased emphasis on reserved group bookings to allow for better staffing control and customer separation Agriculture/Forestry/Fishing/Hunting Diversification of production through rotation or planting/grazing of a wider variety of products, particularly specialty products with Native connections of other high perceived-value elements Diversification of sales outlets, including multiple processors, direct retail and online sales Development of processing, packaging and distribution capabilities to produce value-added and vertically integrated agricultural ventures Microlending, guaranteed purchasing and other small-scale support for the efforts of individual members to diversify or add value to their own production Negotiation of tribal agricultural consortiums and tribe-to-tribe purchasing agreements to help seed new development initiatives Increased mandates to purchase from within tribes or tribe-to-tribe for foodservice supply and tribal grocery retail Exploration of recyclable paper and carboard packaging opportunities for tribal timber production where suitable
∴ EXECUTIVE SUMMARY
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Expansion of hunting and fishing activities for both tourists and tribal members to the extent supportable by the eco-system. This can be coupled with the increased RV camping and glamping initiatives already described Mining & Extraction There is little to be done to mitigate the effects beyond what is traditionally done in the sector: layoffs, temporary shuttering of facilities, production cuts and patience. One aspect worthy of more intensive focus is the same concept of tribal consortiums and tribe-to-tribe purchasing mentioned previously. The concepts are already in place for oil and gas, but only in their infancy. Expanded efforts to develop tribal networks for oil and gas and for other mined and extracted products should be among the major foci of the cooperative meetings between various tribal associations and tribes themselves advocated in this report. Beyond such efforts, we have no significant additional prescriptions to offer, other than the same resigned patience always exhibited in the sector during difficult times. Our forecast shows that by 2023, the sector should be well on its way to restoration of profitable economic activity. Construction Active lobbying and pursuit of grants and low-interest loan programs for infrastructure and other construction projects from non-tribal sources by tribal associations and individual tribes alone or in consortiums Identification of any repair or renovation projects for existing tribal businesses and infrastructure to maintain minimal operating levels for construction teams Active pursuit of larger-scale renovation and expansion projects for Indian casinos as previously discussed Increased tribe-to-tribe and AIAN-owned construction sourcing for any projects available Documentation of potential construction labor and other economic benefits from new manufacturing or other projects to support loan and grant applications. Manufacturing
Strategic planning and analysis of tribal legal, land, labor and capital advantages to inform and justify new manufacturing initiatives and lobbying efforts at the association, inter-tribal and individual tribal levels Coordination of lobbying and public messaging between tribal associations with a focus on tribal manufacturing development
∴ EXECUTIVE SUMMARY
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Active lobbying and pursuit of grants and low-interest loan programs for the diversification of supply and repatriation of manufacturing capacity through multi-tribe and tribal/non-tribal consortiums that marry land and labor with capital and expertise Further strengthening of inter-tribal purchasing to support increased manufacturing production Exploration of vertical integration and value-added manufacturing opportunities by agricultural tribes, either alone or in partnership Active diversification of supply and sales outlets by existing tribal manufacturing ventures to protect against future disruptions with a particular focus on other tribal sources and outlets Increased automation of tribal manufacturing, particularly of new ventures, to protect output capacity in case of new public health or other emergencies Research into product improvement for PPE and other new or existing supply needs for Indian gaming to increase the proportion supplied by tribal vendors Wholesale Trade Active diversification of supply chain and sales outlets to mitigate current and future risk of disruptions to key vendors or buyers Exploration of horizontal integration and product diversification to cater to increased demand for multiple vendors and multiple products lines as the recovery takes hold Increased and sustained communication with tribal leadership and other tribal entities to explore supply or sales opportunities and ensure awareness of product lines available Participation in planning and lobbying initiatives with tribal manufacturers to expand products manufactured and sold from tribal lands Exploration of automation opportunities to protect output capacity in the event of public health disruptions Further development of online ordering and shipping capabilities to expand the pool of sales outlets Monitoring of internal costs in relation to market pricing to maximize margins across product lines Retail Trade Aggressive efforts to increase online presence and ordering and shipping/delivery capabilities Diversification of retail mix where demand and space allow to include sufficient essential products to allow operations to remain open in future shut downs
∴ EXECUTIVE SUMMARY
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Diversification of suppliers and increased inventory space to protect against product shortages Analysis of product pricing taking into consideration market trends, the characteristics of your demand base and the increased operating costs of the post-pandemic environment Increased automation in cashiering, customer service and other areas where possible to help control labor costs with lower volumes Reevaluation of space needs and associated costs for front-of-house versus back-of-house in light of new spacing requirements and inventory needs Transportation & Warehousing The primary impact of this sector will be the potential for increased freight and warehousing demand for tribal operators involved in those businesses. Between increases in online shopping, diversification of the supply chain and increased inventory space needs, demand for freight transport and warehousing is forecast to grow. As with manufacturing, some tribes are strategically located and can offer ample land and potentially lower taxes to warehouse and freight operators or develop them in their own right. To the extent that the same tribes do not have capital to develop or expand such ventures, working with other tribes to obtain financing or joint venture could solve the problem. Any tribe already active in warehousing and freight transport or actively pursuing increased manufacturing opportunities as described earlier should also be looking to expand their network of shippers and delivery destinations over the next two years to boost their presence in the sector for the long haul. Other Industry Sectors The needs and opportunities of the various other industry sectors not profiled independently in this analysis are too great for a comprehensive discussion or listing of recommendations for recovery and renewed growth. However, a few prescriptions that we consider useful are presented below:
Discussions with utility companies to explore additional, environmentally friendly generation and transmission on and through tribal lands to boost local capabilities and generate new construction demand Active pursuit of enhanced internet and cellular connectivity for tribal government, residents and businesses Direct negotiations with lenders and financial institutions to adjust payment terms and increase lines of credit to support ongoing operations during the crisis and new growth and recovery efforts afterwards Exploration of funds availability for single and multi-family housing development for tribal members to support construction businesses and improve tribal living conditions.
∴ EXECUTIVE SUMMARY
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Exploration of funds availability for educational repair and renovation to support construction businesses and improve tribal living conditions. Analysis of in-home impediments to telehealth and other remote health initiatives and rectification of the impediments, including lobbying for and pursuing grants and loans to improve health care effectiveness for remote and elderly tribal members Evaluation of other cost savings and possible wage cuts to preserve tribal government jobs rather than resorting to layoffs during the crisis Pursuit of multiple tribal member focus groups during and after the crisis to explore ideas for dealing with the downturn and increasing opportunities during and after recovery
MONITORING FUTURE HEALTH
As we have noted, we are still early in the course of the pandemic and even earlier in the course of the economic crisis spawned by the disease itself and by efforts to contain it. Every statistical measure available on the disease, as well as on the economy, has flaws in its timeliness, accuracy and breadth of applicability. History is informative but not necessarily indicative. Therefore, it is useful to consider what factors and indicators should be monitored to determine if the course of the disease and the economic crisis are conforming to the forecasts in this report or are varying to a significant degree in your particular area. Indicators to monitor include: COVID-19 AND CIVIC RESPONSE
National daily and cumulative infection totals and deaths State/county daily and cumulative infection totals and deaths Daily infection totals and deaths in areas that reduce restrictions earlier beginning three to four weeks after the change and for eight weeks thereafter (too soon to tell) Monitoring of daily infection totals and deaths in China and in Western Europe for the remainder of this year (so far so good) Monitoring of public statements, reports, orders and guidance issued by your state and local authorities, of the majority public reaction to them and of the majority public reaction to similar guidance or orders by other governmental leaders in counties and states where leadership is affiliated with the same party as that in your area Monitoring of significant outbreak clusters at major businesses in your local area or at comparable businesses in other areas (e.g. meatpacking plants, nursing homes, etc.) Careful monitoring as much as possible of your own employees and customers.
∴ EXECUTIVE SUMMARY
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GENERAL ECONOMIC CONDITIONS Whether or not an additional stimulus package is passed by Congress and signed by the President prior to the end of September and the magnitude and characteristics of the package The outcome of the national and of state elections in terms of divided government, removal or reelection of incumbents and whatever “mandate” is widely considered to have been given to those elected Momentum during the lame-duck period for the current elected officials to lock in or out changes by their replacements if the new government will have significant changes in power sharing Customer traffic and spending trends four to eight weeks after the resumption of limited or full-scale business The status of international trade agreements and temporary international pandemic-related restrictions Discipline amongst oil producing nations in controlling output to support costs The degree to which the financial community responds to increased risk and decreased debt repayment issues by tightening qualifications for lending The speed and proportion of rehiring by employers as business restrictions are eased The degree to which lawsuits over infections, employee safety and insurance distribution spread and become publicized or are preempted Back-to-school, Black Friday and Cyber Monday sales figures The speed with which hazard-pay increases for essential workers are rolled back and the amount of employee, public and governmental resistance to the rollbacks Unemployment rates, major employer closures and local government budget cuts in your immediate area Vacation travel and lodging industry performance nationally and in your area from July through October TRIBAL ECONOMIES Indian-specific elements of any new stimulus legislation Funding levels for all major components of the federal budget affecting Indian country in the next three years Implications of national and statewide election results for hot button political issues related to tribes and general economic policy Success in completing the 2020 census accurately, particularly tribal member participation Formal actions at the federal level to encourage domestic production, repatriate manufacturing and diversify supply chains
∴ EXECUTIVE SUMMARY
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