The Implications of Permitting and Development on Indian Reservations

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1 The Implications of Permitting and Development on Indian Reservations The Development Approval Process in Washington Connie Sue Martin

2 Permitting and Developing Projects on Indian Reservations How are they different from other projects? What are the benefits of projects on Reservations?

3 Permitting and Developing Projects on Indian Reservations What should you be aware of in contracting with Indian Tribes or Tribal entities? How can you protect your clients in contracting with Indian Tribes or Tribal entities?

4 How are projects on Indian Reservations different? Tribal Sovereignty Regulatory Authority over Reservation Land Application of Labor and Employment Laws

5 How are projects on Indian Reservations different? Department of Interior Review and Approval of Contracts Dispute Resolution Enforcement and Collection of Judgments

6 Tribal Sovereignty Tribes occupy unique and distinctive political and legal status Separate, sovereign nations Inherent authority to regulate members and territory

7 Tribal Sovereignty Tribes occupy unique and distinctive political and legal status Congress retains unlimited and absolute power over Tribes Exist as dependent wards subject to sovereignty guardianship of U.S. Limits on Tribal regulatory authority

8 Indian Reorganization Act Indian Reorganization Act of 1934, 25 U.S.C IRA sought to increase Tribal selfgovernment, decrease federal control Encouraged written constitutions Returned surplus lands to Tribes Granted Tribes power to manage internal affairs

9 Indian Reorganization Act 16 (25 U.S.C. 476) addresses the organization of Tribal governments 17 (25 U.S.C. 477) provides for the organization of Tribal corporations Empowers Tribe to purchase, take by gift, bequest or otherwise, own, hold, manage, operate, and dispose of real and personal property (except trust lands) Grants Tribe all powers incident to the conduct of corporate business

10 Indian Reorganization Act 17 also provides for the organization of Tribal economic enterprises those businesses created by the Tribal government for the direct benefit of the Tribe or its members; or those businesses that generate profits that provide a revenue stream that feed directly into Tribal funds

11 Trust Obligation owed to Indian Tribes by the Federal Government Federal government holds title to significant portions of Reservation lands, in trust for the benefit of the Tribe Limits the Tribe s authority to sell, mortgage or lease Trust lands for a period exceeding 25 years Creates a fiduciary obligation owed by the federal government to the Tribe to protect or enhance Tribal assets (economic, natural, human or cultural)

12 Regulatory Authority over Reservation Lands Tribes have criminal and civil jurisdiction over Tribal members on the Reservation Tribes have civil jurisdiction over Trust lands and lands held in fee by Tribal members

13 Regulatory Authority over Reservation Lands Tribes may have civil jurisdiction over nonmembers on the Reservation and fee land owned by non-members (contractual relationship, or matters affecting Tribal health, welfare, and sovereignty) the Montana test

14 Zoning Regulatory Authority States cannot regulate the use of Trust property inconsistent with federal treaty, statute or agreement Tribal trust land not subject to state or local zoning regulations Many Tribes have adopted Tribal zoning ordinances, comprehensive systems of land use regulations and building and development permitting

15 Federally Chartered Municipality Tulalip Tribe created the Consolidated Borough of QuilCedaVillage, a municipal body politic and corporate, a municipality separate and distinct from the Tulalip Tribe

16 Federally Chartered Municipality Dept. of Interior approved the Village s status as a political subdivision of the Tribe under the Indian Tribal Government Tax Status Act of 1982 that (along with a formal IRS opinion) enabled the Village to sell municipal bonds to support infrastructure development

17 Federally Chartered Municipality First federally-chartered municipality since Congress chartered Washington, D.C. in 1871 Functions just like any other municipality

18 Federally Chartered Municipality Governed by an appointed Village Council that enacts ordinances and legislation, develops and approves the Village budget, and sets policies Ultimately, Village Council will be elected by eligible voters of QuilCedaVillage (under terms of charter, those are members of the Tulalip Tribe)

19 Federally Chartered Municipality Being a municipality protects Tribe from annexation of land by county or local government where majority of employees or users of the property are not Tribal members

20 Federally Chartered Municipality Separate status allows Village to pass measures to encourage outside investment in the shopping center without binding the entire Reservation Preserves the rural character of the rest of the reservation while encouraging development of the shopping center area

21 Environmental Protection Sources of Tribal authority: Inherent authority to exercise sovereign powers to protect health and welfare of Tribal members Treaties, federal statutes and executive orders reserving rights of Tribes in lands, waters and natural resources Delegation of federal authority under environmental statutes such as CWA, CAA, CERCLA

22 Environmental Protection Tribes afforded Treatment as State authority may implement and enforce federal environmental statutes Tribes may adopt and enforce Tribal environmental statutes Individuals and entities doing business on Reservation must be aware of and comply with applicable Tribal codes, ordinances and regulations

23 Taxation A state cannot interfere with the operations of the federal government or directly tax the United States without the specific consent of Congress Immunity of federal government to state taxation extends to Indians and Tribes in Indian Country

24 Taxation Indian Preemption Doctrine requires particularized examination on case-by-case basis; to avoid preemption, state must establish compelling interest to assert tax authority

25 Taxation States may not tax or encumber real or personal property belonging to Tribes or individual Indians within Indian Country States may not impose vehicle excise tax or registration fees upon Indians who reside and maintain their vehicles in Indian Country

26 Taxation States may not tax members Reservation income Non-Indians doing business with Tribes on Reservation may be immune from taxation as well

27 Taxation Immunity applies when tax imposed on non-indians if indirect impact of tax on the Tribe frustrates federal policies of Tribal self-determination Sales of personal property exempt from B&O tax where property delivered to buyer in Indian Country; property located there at time of sale; seller has place of business in Indian Country; and sale was solicited while seller was in Indian Country

28 Taxation Businesses performing retail services (e.g., construction, auto repairs) for Tribes or Tribal members in Indian Country exempt from B&O tax on income from such services and from public utility taxes Businesses performing professional or personal services (e.g., engineering, legal, tax preparation) for Tribes or Tribal members in Indian Country exempt from B&O tax on charges for such services

29 Taxation Non-Indians who live or do business on Reservation or in Indian Country not exempt from state taxation on Reservation Income and property

30 States can levy taxes: Taxation on sales and services to persons other than Indians in Indian Country on work performed for a Tribe or member off the Reservation on income earned by members living or Tribal businesses operating off-reservation

31 Tribal Taxes Federal government has consistently recognized that Tribes possess power to levy taxes over members and non-members on Reservation lands Except where Congress has provided otherwise, Tribes may exercise inherent power of taxation as sovereign entities over members and non-members to the extent non-members accept privileges of trade, residence, etc. to which taxes attach

32 Labor and Employment Laws Courts generally reluctant to apply federal statutes that regulate terms and conditions of employment unless statutes expressly address and include Tribes Two statutes expressly exclude Tribes from coverage Title VII of the Civil Rights Act of 1964 Title I of the Americans with Disabilities Act

33 Labor and Employment Laws State Workers Compensation Laws 40 U.S.C authorizes application of workers comp laws to federal lands and premises, including Tribal trust and Reservation lands

34 Labor and Employment Laws State Workers Compensation Laws 40 U.S.C does not abrogate Tribal sovereignty; state workers comp laws do not apply to Tribal employers on-reservation businesses unless employer consents Non-Indian employers in business with Tribes may be exempt from state workers comp laws

35 Labor and Employment Laws Occupational Safety and Health Act Historically, courts reluctant to apply statutes to Tribes that regulate terms and conditions of employment, including workplace health and safety, unless expressly included in statute OSHA does not preempt Tribal safety regulations as it does state laws Tribes may adopt so long as application does not conflict with the application of OSHA

36 Labor and Employment Laws Fair Labor Standards Act Establishes minimum wages and requires employers to pay time and a half for overtime work for covered employees Courts have held Tribal businesses generally not exempt from FLSA, unless employees carry out Tribal governmental functions (e.g., Tribal law enforcement personnel) FairPay Rules effective 8/23/04 drastically altered traditional tests of exemption, impact on Tribes not yet known

37 Labor and Employment Laws National Labor Relations Act Guarantees workers the right to join unions and protects workers from unfair labor practices Historically, did not apply to Tribes, could adopt and enforce right-to-work ordinances precluding union membership as condition of employment

38 Labor and Employment Laws National Labor Relations Act In San Miguel Indian Bingo & Casino case (5/28/04) NLRB reversed its prior precedent and held that NLRA applied to Tribally-owned commercial enterprises

39 Labor and Employment Laws San Miguel adopted new test for determining applicability to employment practices of Tribes: Tribes are not exempt from the NLRA (location of enterprise not relevant) NLRA is a statute of general applicability (commercial activities of Tribes not vital to selfgovernance or essential attribute of sovereignty) No general rule, must be determined on case-by-case basis (balancing test)

40 Labor and Employment Laws Under Indian preference exemption of Title VII of Civil Rights Act of 1964, employers must select qualified Indian applicants for job vacancies to the exclusion of any qualified non-indian applicants

41 Labor and Employment Laws Preference for members of federallyrecognized Inidan Tribes has been upheld by U.S. Supreme Court as a political, rather than a racial distinction Contracts with Tribes may include Indian preference language

42 DOI Review and Approval of Contracts From all contracts involving payments by Tribes for services related to their lands required Secretarial approval; without approval, contracts null and void New statute and final rules adopted in 2000 limit approvals required, identify types of contracts and agreements exempt from approval requirement

43 DOI Review and Approval of Contracts Exemptions: Leases, rights-of-way, other documents conveying a present interest in Tribal land Contracts or leases conveying temporary use rights assigned by Tribes to Tribal members

44 DOI Review and Approval of Contracts Exemptions: Contracts and agreements that do not convey exclusive or nearly exclusive proprietary control over Tribal lands for > 7 years (e.g., construction contracts, contracts for services, bonds, loans, and security interests in personal property)

45 Sample Contract Provisions See Appendix, Section IV of written materials

46 Dispute Resolution Tribal Sovereign Immunity Can you sue? Forum If you can sue, which tribunal? Enforcement and Collection of Judgments Once you get a judgment, how do you enforce it?

47 Sovereign Immunity Dispute Resolution As sovereigns, Tribes and Tribal officials acting in scope of authority enjoy immunity from nonconsensual suit in same manner as state and federal governments Tribal sovereign immunity extends to Tribe s commercial and proprietary activities, making it broader than with other governments

48 Sovereign Immunity Dispute Resolution Congress may waive Tribal immunity by statute Tribe may waive sovereign immunity through ordinance or contract To be effective, waiver must be an official act that clearly and unequivocally expresses consent to suit

49 Forum Dispute Resolution State courts have no jurisdiction over claims brought by non-indians against Indians for claims arising in Indian Country Tribal courts have broad authority to hear civil disputes

50 Forum Dispute Resolution Federal courts require the exhaustion of Tribal remedies before hearing merits of a case brought in Tribal forum, conmityrequires district court to defer to Tribal court s determination of jurisdiction

51 Dispute Resolution Tribes or Tribal members may choose to submit to jurisdiction of particular forum Tribal plaintiff may sue non-indian defendant in state or federal court Some Tribal codes require suits against non- Indian defendants to be brought in state court Tribes or Tribal members may agree in contract to a particular forum (e.g., state court, AAA arbitration)

52 Enforcement and Collection of Judgments Judgments made by Tribal courts subject to Tribal laws regarding enforcement and collection Enforcement of state-court judgements on- Reservation subject to Tribal processes, state processes off-reservation (assuming jurisdiction)

53 Enforcement and Collection of Judgments State courts vary in their recognition of Tribal court judgments for execution off- Reservation Federal law prevents enforcement of state or Tribal court judgments against trust property

54 Protecting the Development Professional Determine applicability of state and federal laws to project Zoning Environmental protection Taxes Labor and Employment laws Requirements for Indian preferences

55 Protecting the Development Professional Determine exemption from DOI review and approval Determine ability to secure Tribal assets for payment

56 Protecting the Development Professional Provide contractual protections for non- Indian business Clear and unequivocal waiver of sovereign immunity Choice of forum (state court, arbitration) Determine availability of assets for collection of judgments

57 Summary How permitting and development projects on Indian Reservations are different from other projects Benefits of doing business with Tribes on Reservations

58 Summary Issues to be aware of in contracting with Indian Tribes or Tribal entities for on- Reservation projects How to protect your clients through contractual waivers of sovereign immunity, choice of forum clauses in contracts with Indian Tribes or Tribal entities for on- Reservation projects

59 Thank you for attending! For additional information on today s topic, please contact: Connie Sue Martin (206) Conniesue.martin@bullivant.com