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CHRISTINA KOENIG: More than half of the 6,000 people who live on the Red Lake Reservation have incomes below the poverty level. About 40% of households on the reservation receive some form of federal assistance.

Beltrami County's largest employer is the Red Lake Tribal Council, which provides jobs for more than 1,000 people. Other employers on the reservation include the Indian Health Service, the schools, and the casino. Only about 4% of the jobs on the reservation are part of the private sector economy, such as gas stations and convenience stores.

Red Lake chairman Bobby Whitefeather says welfare assistance has had devastating effects on Indian tribes since it came to the reservations in the 1960s. He says the American Indian culture of subsistence is contrary to an economic system based on accumulating material wealth. Chairman Whitefeather says new welfare laws requiring people to work are being imposed on tribes without adequate input or consideration. He says legislators have not been listening very carefully.

BOBBY WHITEFEATHER: We've attempted for as long as I've been on a council to create more jobs. I mean, that's essentially something we've been doing since I've been on the council and I'm sure for years prior to that is to create jobs. And though we have made some progress, our population grows faster than we can provide jobs.

CHRISTINA KOENIG: Historically, creating jobs at Red Lake has been complicated. Red lake is a closed reservation. All of the land is held in common by tribal members. No one owns particular plots. That means entrepreneurs from off the reservation who would like to start up a shop or factory wouldn't be able to own the land on which the enterprise would sit.

Nearly all of the welfare recipients on the reservation are female heads of single parent households, most of whom have no transportation, day care, or previous employment history. Red Lake's director of Family and Children services, Margaret Thunder, says if parents are unable to meet requirements to receive aid, they will become unable to feed or clothe their children.

MARGARET THUNDER: One of the concerns that I have is that it's going to create more despair and more breakup of the family at the same time that they are going to be mandating new policies regarding welfare, our monies that has been available through the Bureau of Indian Affairs for foster care or child welfare assistance funds, it's being cut. It's going to create more homelessness, more helplessness, I think.

CHRISTINA KOENIG: Tribal planner Sandra King says she has faith that Indian people will rise to the challenge of welfare reform. She's working on developing ideas for cottage industries, such as crafting birch bark baskets at home to avoid daycare and transportation problems.

SANDRA KING: What we have here is we have all these natural resources. And we have people, all kinds of people. And we have the fact that we're Indian. And that can make an industry. If you make a market, if you find your market, that would make a good industry.

CHRISTINA KOENIG: Do you think there could be several hundred jobs?

SANDRA KING: Hey, sure. [LAUGHS] Actually, it could be if we did it right. I don't know. We're going to give it a try.

CHRISTINA KOENIG: King says the basket-making venture has all kinds of positive ramifications because families could work together and revive ancient art forms. King is optimistic that marketing cottage industry products on the internet could really take off.

Other plans to help welfare recipients prepare for work are underway at Red Lake. Soon, people may be able to earn GEDs and study welding and computer skills at a special satellite office of Bemidji's technical college right on the reservation. But whether Red Lake will be able to comply with the new welfare mandates is not clear.

DAVE HENGEL: I think reservations in general and particular Red Lake, due to their remoteness, are probably going to have as tough a time as anybody in the state of Minnesota to implement the welfare to work requirements.

CHRISTINA KOENIG: Dave Hengel is the economic development director at the Headwaters Regional Development Commission, which is working to address welfare to work requirements in several Northern Minnesota counties.

DAVE HENGEL: One thing I'll say about Red Lake is I think they're addressing it in a way as quickly and certainly as comprehensively as anybody I've seen across the state. They were prepared. The chairman's known about welfare reform, educated himself very well on welfare reform.

They've had a committee up there working on implementing welfare to work for quite a while. So I don't know if they're doomed to failure. I think they're creative. And I think they'll think of ways that'll certainly help to address the issue. It will be difficult. But I certainly hope they aren't doomed to failure.

CHRISTINA KOENIG: Hengel says he wouldn't be surprised if the legislature ends up extending deadlines or providing safety nets, such as food stamps, for areas like the Red Lake Reservation, where substantial job creation is unlikely. Red Lake welfare recipients will need to find jobs or participate in work-related training programs by January if no further changes are made in the Minnesota Family Investment Program, which is slated to replace AFDC. Single parents who receive welfare benefits will have an additional six months to start work or job training. For Minnesota Public Radio, I'm Christina Koenig in Bemidji.