That explains why funding for the Crazy Horse School in South Dakota increased from $4 million in 2000 to $5.6 million in 2011, even though each year's audit reported a litany of problems: Blank checks were not locked away, expenses were not competitively bid, payments couldn't be backed up with invoices, employee travel patterns showed waste and possible abuse. During this time, Indian Education questioned at least $5.7 million in costs at Crazy Horse.
Thomas Thompson, a senior budget official at Indian Affairs, said reducing funding based on past practices would penalize tribal members rather than address management issues. The standard punishment is requiring tribes to submit invoices for reimbursement, rather than giving full funding at the start of each year.
Agencies can in theory wrest programs back from tribes, but almost never do. In 2012, for example, Indian Affairs had taken back the programs of three of 566 federally recognized tribes. "They don't want to take the program back;" said Brian Pogue, a BIA employee for 30 years who retired as its director. "They want the tribe to succeed."
Despite the myriad problems detected in Northern Arapaho programs, including personal use of grant money, the tribe is not among the three.
When the Northern Arapaho audit report for 2010 was finally filed earlier this year, the auditors gave the tribe the worst possible rating. They said the tribal government was such a mess that they couldn't even render an opinion.
Despite the disarray, federal funding kept increasing. The tribe spent $14.8 million in 2010 — up from $9.3 million in 2007.
The current business council — a group that pledged reforms when it took office in January — said the diabetes and elder food programs had been cleaned up. New software will help detect fraud, and the council said it is working to implement further reforms.
"I know it's going to take some time. Change don't happen overnight," said new Northern Arapaho Business Council member Ron McElroy. "It's a lot more than I imagined."
Pritchard reported from Los Angeles. Interactive Newsroom Technology Editor Troy Thibodeaux in New Orleans and researcher Susan James in New York contributed to this story.
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