And now:Ish <[EMAIL PROTECTED]> writes: Tribe hopes cigarettes will lead to job jackpot http://www.seattletimes.com/news/nation-world/html98/trib_120798.html by Scott Canon Knight Ridder Newspapers Posted at 07:19 a.m. PST; Monday, December 7, 1998 MACY, Neb. - They tried bingo and bombed. Next, the Omaha converted their 2,000-seat hall into a health club. It didn't make enough to pay utilities. Now, much of the hall hums with machines that roll North Carolina tobacco with paper and filters and stuff the resulting cigarettes into packs, then into cartons and finally into cases. "The idea was to make some money and to create a few jobs," said Elmer Blackbird, Omaha tribal chairman. The American Indian tribe desperately needs both. Unemployment among the 3,200 or so Omaha who live on the reservation exceeds 70 percent. And gambling profits, a bonanza for so many other tribes, have always eluded them. They opened a casino several years ago in Onawa, Iowa, but when the state legalized riverboat gambling, the tribe's remote gaming location lost 75 percent of its take. Which leads to menthol, full flavor, light and ultralight Omahas. "We're thinking about buying some more equipment so we can make 100s," said Franklin Dick, general manager of the only tribally owned cigarette factory in the country. Those longer 100s cigarettes, he said, are in demand for the bargain hunters the Omaha brand is after. "People tell us that if we can just make 100s, business will really take off." So far, the Omaha Nation Tobacco plant produces more than 40,000 cartons a week - well short of even 1 percent of the domestic cigarette market. But that's business enough to employ 14 workers - a dozen Omahas and two nontribal technicians. More than 200 other members of the tribe have applied for jobs. For the most part the tribe's status as a sovereign nation gives it little economic advantage. Only those very few cigarettes sold from one Indian to another on the Omaha reservation in northeast Nebraska and west-central Iowa are exempt from state taxes. Still, the tribe prices its smokes low - at roughly half what Marlboros or Camels sell for - and has tapped an informal network of stores on tribal reservations that sell large quantities of cigarettes of all kinds at roadside shops across the country. Cigarettes sold by American Indians to non-Indians on Indian land are subject to state taxes, although states often have difficulty collecting the surcharges. Many tribes have compacts with state revenue departments, agreeing to collect the tax on reservations in return for half the money. Poor sales at standard price When the price isn't discounted, sales are weak. At the Golden Eagle Casino owned by the Kickapoo tribe near Horton, Kan., the Omahas were put in a machine and sold at the standard $2 price charged for other brands. "We sold about two packs in two months," said Juell Keo, casino purchasing agent. If the tribe can command just 1 percent of the cigarette market, a federal "buy Indian" law would require them to be carried at every American military outpost. "We couldn't handle that volume yet," said Dick. "But down the road that would mean quite a few jobs." On the Omaha reservation the cigarettes sell for 80 cents a pack. On the Cheyenne reservation in Oklahoma a carton of 10 packs sells for $7.50. "We ship them everywhere, from Long Island to Washington state," said Dick. "They're really catching on at other reservations." Tribes, in fact, make for an especially good smoking market. In nearly every category - men, women, high-school seniors - smoking among Indians is about 30 percent above the national average, although the rates vary widely from tribe to tribe. Studies by the Indian Health Service blamed 10 percent of Indian deaths on tobacco. "It's a very serious health issue among Indians," said W. Craig Vanderwagen, the director of clinical and preventative services for the Indian Health Service. And that has some Omaha feeling at least uncomfortable about the tribe's tobacco business. "I live among my Omaha people, and we're all pitiful. You know, we're in terrible poverty," said Barry Webster, director of the Four Hills of Life Wellness Center, in Macy. "The cigarette plant is good in the sense that it's providing jobs. . . . But I hate to see our people hurting themselves with the smoking." Some trouble at plant The plant has had some troubles. Blackbird, who leads a new tribal council elected this month, said that the cigarettes were producing modest profits for the tribe and that the new tribal administration hoped to improve management at the plant. "We've heard rumors that there's some (financial) irregularities at the plant," Blackbird said. Federal and tribal authorities report that no charges have been filed in connection with the tribe's cigarette operation. Dick, a member of the council that was defeated in the November elections, said recent audits found no evidence of theft. So the plant keeps coughing up cigarettes by the case, a small but hopeful economic engine on a reservation with virtually no other Indian businesses. "Management of any new kind of business is tough in areas like this because you don't have somebody with the specialized experience just sitting around locally," said Russell Bradley of the U.S. Bureau of Indian Affairs. "But as time goes on, as they learn how to run the operation, the plant's got real potential." 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