Chapter Four: Taxes, Economic development, and Sovereignty
Section One: Indian Tribal Government Tax Status Act of 1982
Other disadvantages to their citizens which the ITC opposed in the 1980s resulted from educational matters. When the Department of Education and the BIA proposed the consolidation of the Johnson O’Malley Program and Title IV-A Education programs, the ITC emphatically stressed the need to keep the separate funding of the two programs in a resolution endorsed on April 11, 1986, because “the intent of the two federally funded programs was not to duplicate services to Indian children and adults but rather complement each other.” In a similar manner, in 1987 the ITC, arguing that the Self Determination Act gave Indian people the sole right to determine the educational future of their children, sanctioned a resolution that successfully opposed “the transfer of responsibility for operation of BIA or tribal schools to states.” Basically, it was the ITC’s contention: “Individual states have never demonstrated their capacity ··· to serve the special cultural and academic needs of Indian children.”
Other important subjects the ITC confronted in the eighties were the related problems of taxes, economic development, and sovereignty. For example, in this period the ITC supported: “The reauthorization of the Indian Tribal Government Tax Status Act of 1982, which identified tribal governments as federally recognized tribes and authorized them to issue bonds ···”
In another regard, nevertheless, the matter of he tribes’ tax status was left completely in doubt. This dilemma surfaced for the first time when Governor Overton James reported at the July 1983 meeting about the ongoing confusion related to securing tax-exempt license plates for tribal –owned vehicles. Al-thought the Oklahoma Tax Commission could not verify where in the commonwealth’s statutes the state could tax tribal-owned vehicles, the agency insisted that it would not grant tax-exempt license plates in absence of legislative authority. Explaining the unique situation, Governor James stated: “Most of the state agencies are just not familiar with the status of the tribes to the U. S. Government as being on of sovereign to-sovereign, and with the difficulty of one unit of government trying to tax another unit of government.”
At the April 1984 ITC meeting at Lake Texoma Lodge, Chief Hollis Roberts, President of the Council and also a state representative, updated the members on the ongoing tax-exempt license plate conflict. Roberts declared that he had requested that the State Attorney General render an opinion based on a recent case decided by the Tenth Circuit Court of Appeals in Denver, ruling that “states do no have the power to tax Indian tribes unless the Congress of the United States expressly granted them that authority.” After stating his belief that Congress had never given any state that authority, Roberts promised the ITC he would pursue the matter further by asking the BIA to confirm that fact in writing.
Hopefully, the ITC had found the way to end the unsettling complexities of sovereignty and taxation. As importantly, the questions of whether or not the tribes could hold high stakes bingo operations and sell tax-free cigarettes on trust property without state interference should be answered at the same time.
Events were to prove the ITC’s hopes were wrong. Still, the Council sought ways to end the struggle amicably with the state. At the January 1985 meeting, Senator Kelly Haney, a Seminole citizen, addressed the complex problems thusly:
- There is a search for revenue in the State of Oklahoma. We have tried to negotiate a number of programs to try to get funds into the State of Oklahoma such as the 1cent temporary sales tax which will go out at the end of December in 1985. We are looking at the method under which the state collects personal income tax, the possibility of corporate income tax and corporate franchise tax, and seriously at the equalization of pick-up tags fees. In this process the Indian tribes have also initiated economic activity in order to fund social services programs, create employment, and economic development.
Tribal bingo has become a buzz word in economic activity for tribal government, as well as the sale of tobacco without sales tax, and car tags. As a result, many legislators have taken a look at tribal governments and have in their own minds decided that these activities are taking revenues from the State of Oklahoma. We are trying to tell the legislature that these tribal revenues are used for tribal employment; the employment of people who would otherwise be on state welfare rolls.
One of the issues that is more significant is sovereignty and the jurisdictional issues that have to do with law enforcement, taxes, economic development, judicial and so forth.
To find a solution, Senator Haney recommended that a State-Tribal Relations Committee be formed to keep dialogue ongoing. Secondly, since there were a number of federally recognized Indian tribal governments in the State of Oklahoma, each retaining attributers of sovereignty and authority for self-government within their territories, the Senator encouraged the passage of a resolution which would: “Establish a government-to-government relationship with the State of Oklahoma and Indian tribes, and authorize state agencies, departments, commissions and boards, as well as political subdivisions which would include counties and cities to enter into agreements with tribal governments.”
While the ITC agreed to cooperate, by appointing Chief Roberts to the tribal-legislative committee that was formed, the effort went un-rewarded because the Oklahoma Tax Commission refused to enter the discussions. Instead, this agency filed suit against the Chickasaw Nation in 1985.
There the matter rested for the Council until the third quarterly meeting of the ITC in 1987. On that day the Council’s mood was a most jubilant one, resulting from the fact that a victory for Indian tribal sovereignty against the State of Oklahoma had just been announced. In a decision released on June 26, 1987, the U.S. Court of Appeals in Denver ruled in favor of the Chickasaw nation because, “It must be guided by the established tradition of the sovereign immunity inherent in the distinct status of the Chickasaw Nation.” The case evolved, as noted, when in October 1985 the Oklahoma Tax Commission sued the Chickasaws in state district court in Murray County, obtaining an injunction stopping all tobacco sales and bingo operations of the Chickasaw Motor Inn in Sulphur until state taxes were collected and paid.
Resisting, with the full support of the ITC, the Chickasaws removed the case to the federal district court in Muskogee, where Federal Judge H. Dale Cook ordered the case dismissed, finding that the tribe could not be sued without its consent or that the U.S. Congress. In losing its appeal of cook’s ruling to the court in Denver, the state was stopped from encroachment against tribal sovereignty.
Yet, the members of the ITC feared the battle was not over. At the ITC meeting in July 1987, Claude Cox, Principal Chief of the Muscgee Nation, warned Council members that the “Indian Tribal Government Authorities Act, a bill drafted by the U.S. Government, will, if passed, be detrimental to the Indian tribe sin Oklahoma since it will destroy tribal government, take away criminal and civil jurisdiction from the tribes and give states regulatory power over tribes and the right to tax the tribes.”
Proving his sagaciousness in legal matters by inspiring the winning of a major lawsuit on Indian bingo, Chief Cox was congratulated by Principal Chief Wilma Mankiller at the July 8, 1988, ITC meeting. Following Chief Mankiller’s declaration that “when one Indian tribe wins, we all win,” Chief Cox related that on June 27, 1988, the Supreme Court let stand a lower court ruling that high-stakes bingo games run by Indian tribes were exempted from state sales taxes.
While the ITC endeavored to resist against federal or state encroachment of Indian sovereignty, the Council also paid attention to rights of their forefathers. It was of historic importance that during the 1980s the ITC began a campaign to point out that “traditionally Indian people uphold high standards of respect and dignity for their deceased and view acts of looting and pillaging of Indian burial ··· sites to be uncivilized.” Because the Smithsonian Institute and other museums have several thousand human remains and artifacts from the tribes and nations of Oklahoma, the Council resolved in 1989, that “all national and state museums ··· immediately return all of the Native American human remains and burial artifacts, permanently, to the respective tribes and nations.”
Emphasizing how significant the ITC felt this them to be, Chickasaw Governor Bill Anatubby announced at the October 1989 ITC meeting that a Chickasaw delegation had made a recent trip to Tupelo, Mississippi, to ensure that proper reverence was given to the remains of Chickasaw forefathers. Having reserved a 15-acre tract of land of former gravesites for a cultural center, the city promised that any artifacts found by excavating would be given back to the Chickasaw Nation.