Haway O-Gah-Pah Nikashi,
As the Secretary-Treasurer for the Quapaw Nation, I am delighted to provide a report to our people here at the Quapaw Post, our new home for all things Quapaw News. This report will allow me to inform our tribal members on matters affecting the state of our tribal Nation's finances or businesses. This report will provide our tribal members greater insight into how our companies or tribal departments function to supplement the needs of our tribal members.
I am coming to the end of the eighth month of my first term of office. There has been an unbelievable amount of progress accomplished, but eight months have never gone by so fast. Administrative changes always present their challenges, but replacing a 20 year administration during a pandemic and one of the most financially trying times in recent history certainly adds a layer of complication.
By this time, I have had a chance to diagnose some of our Nation's shortcomings and its areas for improvement regarding our community, tribal programs, and tribal member assistance. Some departments have grown rapidly and flourished in recent history, while others that are of paramount importance to the future well-being of our tribe have languished with no growth to their budget. Issues such as homelessness, addiction, and education have not received the proper attention and need to be better funded. We are blessed to have a very effective grants department to help with these initiatives' funding, but grants and federal funding alone are not enough; this is why economic development is essential for financial independence and the protection of our sovereignty.
Economic development through business diversification and gaming has been some of the greatest aids to sovereignty in Indian country. This notion is never more applicable than it is to the Quapaw Nation. Our businesses and gaming have expanded our administrative budget, and their success is directly tied did the level of service offered to our tribal members.
Once I took office, I made it my sole mission to evaluate our administrative departments' performance and the businesses that help fund those departments. Some of what we found was encouraging, and other things we saw were alarming. Apart from our land remediation contracts and our gaming entities, every other tribal business operated at a net loss. Some of these businesses lost a little bit of money, and the others were hemorrhaging it. Since that time, we have been able to stop the financial bleeding and are now turning these businesses back into profit centers that employ even more tribal members and members of our community.
Our gaming entities, while profitable, were not running efficiently. ROI's had not been performed in years. There was no attention to expense management and no focused attention on their core market. We have installed new executive management, transforming the business culture and emphasizing a safe and healthy work atmosphere. We have been able to open our latest gaming property, Saracen resort, and become the industry leader in Arkansas. We have increased Downstream Casino's profitability by over 140%, and we have increased the bond market value for these properties by over 20%. In an average year, these would be monumental accomplishments for any business going through such a significant administrative change. But this committee has been able to accomplish these improvements during one of the Nation's most significant economic setbacks spawned by the spread of Covid 19.
Our gaming properties continue to outperform historical earnings, and the month of March was no exception as it was the most profitable month in Downstream's 13-year history. This improved performance and commitment to deleveraging outstanding debt on these gaming properties have attracted the top financial institutions worldwide. We are now poised to refinance our gaming entities in a way that allows us to reduce our principle and ultimately become debt-free, something that was never prioritized in the past. We have received an overwhelming amount of positive feedback from market analysts regarding our performance and willingness to communicate openly with Wall Street. One of Downstream's largest creditors had this to say about our recent efforts to improve our relationship with Wall Street:
"I just wanted to reach out and let you know that your efforts to increase transparency by attending the BofA conference last week definitely paid off… the 10.5% QUAPAW bonds due 2023 are now trading in the $101.50-102.00 context (vs. mid-80s before), while the broader high yield market has been essentially unchanged over the same timeframe. So thank you very much for that! This was a perfect example of the benefit of increased management/investor transparency!"-Analyst with Janus Henderson Investors.
Good stable financing for our gaming entities focused on eliminating debt is the only path forward to increasing our tribal administrative budget to improve and build upon the services and assistance that the Nation provides to our tribal members.
In addition to revenue from our gaming entities and businesses, there have been several matters of litigation and settlement damages that have provided a benefit to trust landowners and one outstanding issue that will benefit all Quapaw Tribal members. Of course, I am referring to Bear et al. v. the United States. The payment of this settlement is subject to appropriation by the United States Congress. The case is settled, and the damages are decided. However, this damage amount must be approved by Congress and then funded by the United States Treasury.
Like all matters involving the US Congress, appropriation is not a simple process. To be appropriated by Congress, the settlement must be voted on and approved by the House and Senate. Before the settlement can be voted on, it must appear on a continuing resolution or CR. The settlement must be approved by an authorization bill voted on and passed by the House and Senate for it to appear on the CR. We are currently in the process of getting the authorization bill passed. Our bill was presented and introduced to committee. We have several sponsors from our congressional delegation, which has led to House legal counsel's office recently blessing the bill. I will be traveling to Washington DC this session to meet with our congressional delegation's individual members to ensure this authorization bill's passage. I hope to improve our relationship with our federal representatives on Bear's passage and any other issues affecting Quapaw Nation.
I have attempted to keep this report brief, but this is often difficult with so many issues to discuss. I am excited and looking forward to providing these reports and some more in-depth insight into our Nation's financial state going into the future. I hope this Address finds everyone well, safe, and healthy.
Guy S. Barker
Secretary-Treasurer of the Quapaw Nation