Tribal Tax-Exemption Win in Washington Supreme Court

The Washington Supreme Court has upheld a state law allowing tribal fee lands used for economic development projects to be exempt from state taxes provided that the tribe pays a payment in lieu of tax. (PILT). The case concerned Muckleshoot-owned lands and Muckleshoot filed an amicus brief in the case. Here is the opinion in City of Snoqualmie v. King County Executive Dow Constantine.

Opinion in Westmoreland v. Dept of Revenue: Taxes Paid to Crow Tribe on Coal Mine Not a State Tax Deduction

Opinion here.

Applying § 15-35-102(11), MCA, to disallow a state tax deduction does not undermine the Tribe’s sovereign authority to tax or govern itself. The Legislature has simply chosen to limit the class of governments to which payment of taxes constitutes a deductible expense for coal producers. By so doing, the Legislature did not implicate tribal sovereignty.
Moreover, as the Department notes, WRI lacks standing to raise a claim implicating the Tribe’s sovereignty. See Northern Border Pipeline Co. v. State, 237 Mont. 117, 128-29, 772 P.2d 829, 835-36 (1989) (Taxpayer corporation had standing to challenge a state property tax, but did “not have standing to assert the Tribes’ sovereign right of self-government in doing so.”). The District Court did not err in so concluding.

Appellant’s Brief

Appellee’s Brief

Reply Brief

Saginaw Chippewa Treaty Case News Coverage

Here’s the news coverage from the Morning Sun:

City, council can join lawsuit

By MARK RANZENBERGER
Sun Online Editor

A federal judge ruled Friday that the city of Mt. Pleasant and Isabella County will be permitted to be part of the federal lawsuit that seeks to define the land inside the traditional boundaries of the Isabella Reservation as Indian Country.

U.S. District Judge Thomas Ludington ruled that the county and city were extremely late in trying to join in the suit, filed in 2005 by the Saginaw Chippewa Tribe against the state. But Ludington, in a ruling released late Friday, said it was within his discretion to allow the two municipalities to join in on the side of the state.

Ludington ruled, however, that the city and county could not bring in their own experts, and would have to abide by all the stipulations already set in the case.

“The court recognizes that the (city and county) have a legitimate interest at stake in this litigation, because an outcome in favor of the Saginaw Chippewas could materially affect their future governmental responsibilities,” Ludington said in his opinion.

The Tribe wants Ludington to declare that all or part of seven townships in Isabella County are “Indian country” as defined by federal law. The Tribe is asking for an injunction to prevent the governor, attorney general and state treasurer from exerting criminal or civil jurisdiction over the Tribe or its members “in a manner not allowed in Indian country.”

The federal government already has joined the case on the side of the Tribe. The county and the city now are part of the case as defendants, on the side of the state.

Both city and county officials say they bear no ill will against the Tribe or Native people, but the suit is a way to define the authority of civil and tribal governments.

Court documents filed by the city say the outcome of the suit could affect, in particular, taxation and zoning.

Tribal attorneys argued that the late intervention was simply a way for the state to buy more time to prepare its case.

Ludington said the city and county could have joined the case soon after it was filed.

At the time that the (city and county) filed their motions, the posture of this case was long past initial trial preparation,” Ludington’s ruling said. “Moreover, the (city’s and county’s) participation in the past case coupled with the local media coverage, indicate that (they) had sufficient notice of this proceeding.”

The “earlier case” mentioned by was a case involving property taxation, which went all the way to the U.S. Supreme Court before being settled. Tribal members, and the Tribe itself, now pay property taxes on land owned outright; land held in trust is not taxable.

In the current case, the Tribe and the Justice Department say that an 1855 executive order, and treaties signed in 1855 and 1864, created an Indian reservation on five full townships and six half-townships in Isabella County, and it continues to this day.

A date for a trial, which would be conducted without a jury, has not been set.

Saginaw Chippewa v. Granholm Update — Municipalities Allowed to Intervene

Judge Ludington has granted the motions of Isabella County and the City of Mt. Pleasant to intervene, but because they were so late in filing (about 2 years after the initial complaint), the judge took the recommendation of the United States to deny these intervenors the right to bring their own expert witnesses.

Here are the materials in this element of the litigation:

Isabella County Motion to Intervene

Mt. Pleasant Motion to Intervene

Tribe’s Response to Motion to Intervene

United States Reponse to Motion to Intervene

State’s Response to Motion to Intervene

Intervenors Reply to United States

Intervenors Reply to Tribe

Order on Motion to Intervene

See our previous post on this case, which includes the complaint and some other preliminary materials.

Saginaw Chippewa v. Granholm Materials

Please find below the amended complaint, answers, and other court documents from this ongoing and important case — (scary, too, if SCIT loses).

Amended Complaint

Answer to Amended Complaint

US Intervenor Complaint

Answer to Intervenor Complaint

Isabella County Motion to Intervene