Indian Leaders Want Narconon Chilocco Audit

By Michael McNutt, Enid Bureau

Daily Oklahoman,
March 25, 1993


NEWKIRK -- Some Indian leaders are disappointed with the amount of revenue being generated by a drug and alcohol abuse treatment center that promised to pay five tribes millions of dollars over the next two decades.

As a result, the leaders of the Kaw and Pawnee tribes have asked the federal Bureau of Indian Affairs to audit the Narconon Chilocco New Life Center to determine whether the non-Indian facility is meeting payment terms of a 25-year lease.

In 1989, Narconon Chilocco leaders said it would pay the five tribes of the Chilocco Development Authority $16 million during the next 25 years in return for leasing the old Chilocco Indian school for a 75-bed drug and alcohol abuse treatment center.

"At the rate we're going, we won't even get a million," said Wanda Stone, Kaw tribal chairwoman.

Stone said payments the tribes receive from Narconon Chilocco usually are tardy.

"They haven't paid us with a payment since last September," she said. Stone and Robert Chapman, chairman of the Pawnee tribe's business committee, said the Indian tribes must depend on Narconon Chilocco to provide figures to determine lease payments.

Narconon Chilocco agreed on lease payments based on the number of patients and the amount of money patients pay per month.

Payment schedules for patients range from no charge for low-income Indians to about $30,000 for a three-month treatment.

"There's no scale of any kind that we can base what we should be getting," Stone said. "All we know is what they send us."

Narconon Chilocco's plans to develop the facility were stalled for more than two years while it tried to get state approval.

Stone said an audit released by Narconon Chilocco showed it had underpaid about $4,600 to the authority through September.

However, an analysis by a former financial officer of the Kaw tribe on Narconon Chilocco's figures showed the facility owed more than $133,000, Stone said.

"A lot of it was, expenses that they took out were not allowable," she said.

There is no provision in the lease for an independent audit.

Gary Smith, Narconon Chilocco president, said the facility's audit is accurate. The BIA has the right to conduct an audit of his facility. He said questions about Narconon Chilocco's audit are based on "misinterpretation of the actual audit," Smith said.

He said he did not know the amount of money his facility has paid in lease payments the past three years but said it was more than $150,000. Smith said Stone's and Chapman's allegations were made to cover up the fact that the BIA has been asked to audit financial records of the development authority.

"It's nothing more than a smoke screen from anybody that might have something that they might be a little nervous about," Smith said. Stone said the Narconon Chilocco audit was prepared on plain paper without letterhead or other information stating who conducted the audit. Chapman and Stone reported the information to about 30 members of the Pawnee, Ponca, Otoe-Missouria, Kaw and Tonkawa tribes, each of which has a representative on the authority.

"We wanted tribal members to understand that we're not stealing from them... We just haven't received our fair share, as we have always suspected," Chapman said.