Participants: Lac Vieux Desert, Lac du Flambeau, Mole Lake, St. Croix, Red Cliff, Fond du Lac, Keweenaw Bay, Bad River, Lac Courte Oreilles
Here is yesterday’s Sixth Circuit opinion in Keweenaw Bay Indian Community v. Rising. The briefs are here. A few excerpts, the first detailing the history of the dispute dating back to 1977, and including the State of Michigan’s use of federal funds supposed to go to KBIC to pay what it considers to be back taxes, very, very dirty pool in my opinion, though KBIC could always sign up with the tax agreement if it chose:
In 1977, Michigan and the Community entered into a comprehensive tax agreement governing payment and collection of sales and use taxes for transactions involving the Community or its members. In 1994, the parties began renegotiating this agreement, but failed to reach accord. In 1997, Michigan terminated its tax agreements with the twelve federally recognized tribes in the State, as part of an effort to achieve uniformity in its agreements with the tribes. Although the State has reached agreement with most of the Michigan tribes, it has failed to reach agreement with the Community. In the absence of any such agreement, Michigan has apparently adopted a policy of taxing transactions involving the Community or its members, while permitting them to apply to the Treasury for an exemption or refund on a case-by-case basis. The State claims that the Community has flouted this policy and refused to pay many of its taxes. Not surprisingly, the parties have repeatedly disputed the amount of taxes the Community owes to the State, and each has withheld funds that the other party claims it is owed. Most notably for our purposes, in 2005 the State withheld $ 34,166.31 in federal funds owed to the Community, which the State offset from the back taxes that it maintained the Community owed.
And here the court addresses the justiciability issue: