Copyright © 2001 NLThomas
All Rights Reserved

TAHLEQUAH, OK - Principal Chief Chad Smith has called a special meeting of the Cherokee Nation Tribal Council for June 25, 2001 at 6 p.m. to deal with financial issues and consider appropriations for Cherokee Nation Industries, Inc., a tribally owned corporation located in Stillwell, Oklahoma.

At the meeting, the Council will consider a legislative act that would use unappropriated surplus funds to provide a $2 million loan to help CNI through a short-term cash flow problem.

"CNI is a profitable enterprise", said Chad Smith, Principal Chief of the Cherokee Nation. "It has average annual profits of nearly $1 million over the past four years, and has made more than $500,000 this fiscal year. The only way that the long-term profitable business would be in danger would be if we turn our back on the company during this business cycle downturn."

Smith says he bases his recommendation for to accept the loan on a report filed by a team of attorneys and accountants representing both the legislative and executive branches of the Cherokee Nation. The team discovered that CNI faces a cash flow problem due to high inventory in its telecommunications division. CNI has been negatively affected by the tremendous downturn in the entire telecommunications industry, and has developed the current cash flow problem. CNI is within its credit limit with its lending institutions, but is past due with some of its suppliers that provide profitable products for CNI. The $2 million would be used to bring these suppliers current, ease the cash flow problem, and allow the business to repay the Cherokee Nation out of continued profits.

The timeline is urgent in this case. CNI’s lending institutions have said that if the Cherokee Nation does not take action before June 30, the banks will take it as a sign that the Nation is not committed to CNI’s future success, and special asset units in the bank may then begin to manage CNI's assets. Once that happens, statistics tell us that the prospects are very poor that the company will avoid liquidation.

CNI has annual revenues of nearly $70 million and has an average annual profit of almost $1 million a year over each of the past four years. CNI ’s net profit this fiscal year is more than $500,000.

"We cannot walk away from an asset that large and that productive, especially considering that it also provides nearly 160 jobs", Smith said. "Those employees are CNI’s greatest asset. They have more loyalty to their company and more dedication to making it succeed than employees at any other business I've ever seen. We cannot turn our backs on these employees and the valuable asset they have created for the Cherokee Nation. They have gone the distance for us, and we must now go the distance for them."

Some members of the Tribal Council have indicated that they may not be able to attend the June 25 meeting. To accommodate their schedules, Smith has called alternative special meetings for June 29 at 6:00 p.m. and June 30 at 10:00 a.m. in case a quorum is unavailable on June 25.