The Inflation Reduction Act: How Do Tribal Communities Benefit?

On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022 (“IRA”), ushering in substantial changes for tax law, climate resilience, healthcare, and more in the United States. According to the Biden administration’s press release, the new $750 billion legislation aims to lower everyday costs for families, insist that corporations pay their fair share, and combat the climate crisis. During the signing ceremony, President Biden stated, “With this law, the American people won and the special interests lost […] For a while people doubted whether any of that was going to happen, but we are in a season of substance.”

Notably, the legislation provides significant provisions for tribal communities and the Bureau of Indian Affairs. Once the funding is appropriated by Congress, it will be directed toward drought mitigation programs, fish hatcheries, modernization of electric systems, and more for Native communities, including ones in Alaska and Hawaii.

How the Inflation Reduction Act of 2022 Supports the Environment and Tribal Communities

The Inflation Reduction Act of 2022 contains an array of provisions, including the reduction of drug prices, the lowering of energy costs, and, notably, federal infrastructure investments that benefit Native communities. Andrew M. VanderJack and Laura Jones, Co-Coordinators of Van Ness Feldman’s Native Affairs Practice, highlight the most significant facets of the bill: “This legislation provides some opportunities specifically for tribes and tribal entities, including programs related to climate resiliency and adaptation, electrification, and drought relief. For example, the Emergency Drought Relief program for Tribes extends direct financial assistance to tribal governments to address drinking water shortages and to mitigate the loss of tribal trust resources.”

Pilar Thomas, Partner in Quarles & Brady’s Energy, Environment & Natural Resources Practice Group, expanded on the most significant inclusions for Tribes: “[…] the creation of a Direct Pay tax credit payment program that allows Tribes to receive a payment equal to the clean energy technology tax credits – especially for solar, wind, storage, geothermal and EV charging stations; […] direct funding for electrification and climate resiliency through DOI and USDA; […] access to the greenhouse gas reduction fund, environmental and climate justice grants; and expanded energy efficiency tax benefits and rebates for tribes and tribal members.”

“Tribal governments are also eligible to apply for other programs such as the Clean Vehicle Credit program, the Energy Efficient Commercial Buildings Deduction, and the State and Private Forestry Conservation Programs,” noted Mr. VanderJack and Ms. Jones.

How the 2022 Inflation Reduction Act Has Been Received by Tribal Communities

The 2022 Inflation Reduction Act has received a warm reception from groups such as the National Indian Health Board and Native Organizers Alliance, who laud the bill’s potential to improve environmental, medical, and economic conditions for tribal communities, some of whom still lack access to electricity or clean water. The increase in funding will allow tribes to use green energy technology to increase climate resilience and decrease individual energy costs, while reducing the effects of environmental racism with risk assessments for drinking water and climate hazards. These infrastructural changes will stimulate economic development by creating new jobs. “With critical investments in the Inflation Reduction Act, we’re making sure the federal government steps up to support Native-driven climate resilience, advance tribal energy development, and fulfill its trust responsibility to Native communities,” said Senator and Senate Committee on Indian Affairs Chairman Brian Schatz.

“This legislation will result in hundreds of millions of funding available for Tribes, and non-profits that work with tribes and tribal communities to support the clean energy transition for tribal communities, reduce energy costs for tribal members, and create jobs,” said Ms. Thomas of Quarles & Brady. “The IRA will provide a substantial down payment for every tribe to take advantage of clean energy technologies, energy efficiency and energy savings, and climate resilient solutions for their communities and tribal members individually.  The new projects, technology implementation and economic development opportunities are substantial and will create long term community and economic development sustainable improvements in tribal communities.”

Some groups feel that the new legislation does not go far enough. In an open letter to President Biden, Senate Majority Leader Chuck Schumer, and House Speaker Nancy Pelosi, Indigenous-led advocacy organization NDN Collective argued that Congress’ hesitance to fully reject fossil fuels undermines the stated goals of addressing climate change, a misstep that could disproportionately affect tribal communities at the frontlines of the environmental crisis. “We believe that moving away from investments in the fossil fuel and other extractive industries and reallocating the funding to further research and development will help us find the solutions we need for true decarbonization and large-scale equitable carbon emissions reductions,” the collective stated. “We are already aware of innovative, Indigenous-led solutions that just need the proper funding and support to be scaled and replicated.”

Challenges in Getting the 2022 Inflation Reduction Act Passed

Up to this point, the Inflation Reduction Act has faced significant challenges in Congress. The legislation is the product of extensive compromise over the Build Back Better Act within the Democratic party. The Build Back Better Bill was initially estimated to cost over $3 trillion, and ultimately, the Inflation Reduction Act was passed with a budget of $750 billion. Senator Joe Manchin of West Virginia held back his support of the bill until late July, and Republicans successfully blocked an aspect of the bill that would have capped the price of insulin for Americans with private health insurance. When presented to Congress, the vote was split by party lines with every Republican voting against the bill. Biden has criticized Republicans for this decision, saying at the signing of the Inflation Reduction Act, “every single Republican in the Congress sided with the special interests in this vote — every single one.”

Challenges for tribal governments remain as well, specifically concerning the IRA’s implementation. “Despite the incredible opportunity for tribes, major barriers remain including tribal internal capacity and capabilities, [and] federal regulatory hurdles (such as BIA leasing and easement approvals),” said Ms. Thomas.

“[…] Navigating the complexities of each program and actually obtaining funding is always the challenge,” said Mr. VanderJack and Ms. Jones of Van Ness Feldman. “Tribes and tribal entities should engage directly, whenever possible, with the grant funding agencies to make sure proposals are tailored to fit both program requirements and community needs.”

Early Assessment of How the IRA will Impact Tribal Communities

The Inflation Reduction Act, ultimately, provides meaningful resources and investments for tribal communities in a variety of ways. While the provisions are not as significant as COVID-19 relief and infrastructure funding that tribal governments have received in previous years, the new legislation is nonetheless beneficial. “While the federal grant funding is relatively small, the potential major impact is the ability to access funding through tax credit payments and rebates,” said Ms. Thomas. “This mechanism is critical as it is simplifies tribes’ access to funding (rather than, for example, seeking to obtain funding through the competitive grant programs).”

Copyright ©2022 National Law Forum, LLC

Supreme Court Expands State Criminal Jurisdiction in Indian Country

In a 5-4 opinion issued Wednesday in Oklahoma v. Castro Huerta, No. 21-429, the Supreme Court expanded the authority of States to exercise criminal jurisdiction over non-Natives in Indian country without tribal consent or congressional authorization, upending a long-standing basic principle of Federal Indian Law and striking a blow to tribal sovereignty. Under federal law, “Indian country” has been interpreted as including Indian reservations, dependent Indian communities, Indian allotments, In Lieu sites (land outside reservation boundaries meant to replace lost Indian lands), and tribal trust lands. The majority opinion in Castro-Huerta, written by Justice Brett Kavanaugh, held that States presumptively have “inherent” jurisdiction over crimes committed in Indian country and “do not need a permission slip from Congress to exercise their sovereign authority,” dismissing the Court’s prior statements to the contrary as non-binding dicta. After concluding States presumptively have criminal jurisdiction in Indian country, the majority found that the General Crimes Act, 18 U.S.C. 1152, did not preempt that jurisdiction for crimes committed by non-Natives against Natives in Indian country. As a result, States now have concurrent criminal jurisdiction with the federal government to prosecute crimes committed by non-Natives against Natives in Indian country.

Castro-Huerta involved the prosecution of Defendant Victor Manuel Castro-Huerta, who was convicted in an Oklahoma State court of a crime against a Native child. Following the Supreme Court’s landmark decision in McGirt v. Oklahoma, 140 S. Ct. 2452 (2020), in which the Court concluded much of Oklahoma is Indian country, Castro-Huerta successfully argued that the State lacked jurisdiction to prosecute him because he committed his crime in Indian country. The State appellate court’s decision in Castro-Huerta’s favor followed the interpretation of the General Crimes Act that has prevailed since the statute’s 1948 reenactment. Under that interpretation, only the federal government has authority to prosecute non-Native individuals who commit crimes against Native individuals in Indian country.

Arguing before the Supreme Court, Oklahoma claimed that the prevailing interpretation is incorrect, and the majority agreed. The Court began its analysis by describing the details of Castro-Huerta’s crime and noting that of the 2 million people who live in Oklahoma, “the vast majority are not Indians.” Op. at 2. The Court also noted that Castro-Huerta had accepted a plea agreement with the federal government for a 7-year sentence followed by removal from the United States (he was in the United States unlawfully), receiving, in effect, a 28-year reduction in his sentence. Op. at 3. The majority stated that his case “exemplifies a now-familiar pattern in Oklahoma in the wake of McGirt” in which non-Indian criminals have received “lighter sentences in plea deals negotiated with the Federal Government” or have “simply gone free.” Op. at 3-4.

Citing the United States Constitution and prior Supreme Court decisions for the proposition that Indian reservations are “part of the surrounding State” and subject to State jurisdiction except as forbidden by federal law, the majority concluded that an “overarching jurisdictional principle dating back to the 1800s” is that “States have jurisdiction to prosecute crimes committed in Indian country unless preempted.” Op. at 5-6.

The majority then considered whether the State’s authority to prosecute non-Native v. Native crimes in Indian country had been preempted under the “ordinary principles of federal preemption” or because “the exercise of state jurisdiction would unlawfully infringe on tribal self-government.” Op. at 7. The majority found that the plain text of the General Crimes Act did not expressly provide for exclusive federal jurisdiction. Op. at 7-14. It then rejected Castro-Huerta’s argument that Public-Law 83-280 and similar statutes through which Congress authorized certain States to exercise jurisdiction in Indian country demonstrated Congress’s understanding that States presumptively lack such authority. The majority reasoned that, despite what Congress might have assumed, the question had not yet been decided and the statutes in question lacked language preempting State jurisdiction. Op. at 16-18. The statutes also provided for civil jurisdiction and State jurisdiction over Natives, in addition to criminal jurisdiction over non-Natives, so they were not entirely redundant.

Turning next to whether the exercise of State jurisdiction under the General Crimes Act would unlawfully infringe on tribal self-government, the majority applied the “Bracker balancing test,” which weighs tribal, federal, and state interests, and is generally used to determine whether a state tax is preempted when assessed against a non-Native on tribal land. The majority concluded that the Bracker factors supported State jurisdiction, dismissing any tribal preference for federal jurisdiction as irrelevant to the Court’s analysis, Op. 19 n.6, Op. 20 n. 7. Concluding the State’s inherent jurisdiction had not been preempted, the majority noted in its holding that, “Unless preempted, States may exercise jurisdiction to prosecute crimes committed by non-Indians against Indians in Indian country,” and this “applies throughout the United States,” including on Indian allotments. Op. 24 n.9.

In a scathing dissent, Justice Gorsuch, joined by Justices Breyer, Sotomayor, and Kagan, pushed back against the majority’s opinion, suggesting any future analysis would need to consider the specific context of each tribe, its treaties, and relevant laws. Dissent at 40-41 n.10. The dissent, appealing for a legislative fix, accused the majority of ignoring history, congressional action, precedent, and tribal sovereignty, and usurping “congressional decisions about the appropriate balance between federal, tribal, and state interests.” Dissent at 38.

© 2022 Van Ness Feldman LLP

Before the Supreme Court…December 9, 2021

The Supreme Court placed two Indian law cases on its docket for the October 2021 term.

In Ysleta del Sur Pueblo v. Texas (20-493), the Supreme Court will determine whether legislation that restored federal recognition to two Tribes permits the State of Texas to regulate gaming activities on the Tribes’ land.  The restoration legislation contained a provision stating that “[a]ll gaming activities which are prohibited by [Texas] are hereby prohibited on the reservation[.]”  Because Texas regulates bingo but does not prohibit it, the Tribe asserts that it therefore retains full authority to set the terms of its bingo games and need not comply with Texas’ regulations.  Texas argues that the Tribe must submit to Texas’ regulations.  The Fifth Circuit sided with Texas, holding that Texas’ regulations became surrogate federal law under the restoration legislation.  The federal government filed a brief supporting the Tribe and urging the Supreme Court to take the case.  The case will directly affect the two Tribes subject to the restoration legislation, but there may be broader implications depending on whether the Supreme Court accepts or rejects the idea that state regulations may, under certain circumstances, become surrogate federal law that Tribes must follow.

In Denezpi v. United States (20-7622), the Supreme Court will decide whether a Tribal member convicted for assaulting another Tribal member on trust land in a “CFR Court” can later be tried for the same conduct in U.S. District Court.  The defendant was charged with serious offenses in the Court of Indian Offenses of the Ute Mountain Ute Agency.  Unlike a Tribal court, Courts of Indian Offenses (or “CFR Courts”—so called because they are authorized by the Code of Federal Regulations) are created by the Bureau of Indian Affairs to administer criminal justice for Tribes lacking their own courts.  The CFR Courts may prosecute violations of Tribal ordinances and other offenses listed in the regulations.  The defendant was charged with three offenses in the CFR Court and ultimately pled guilty to one count and received a 140-day sentence.  Six months later, the defendant was indicted in U.S. District Court.  The defendant asserted his prosecution was barred by the double jeopardy clause of the U.S. Constitution.  The lower federal courts, however, concluded that the CFR Court was not exercising the sovereignty of the United States, but was instead exercising the sovereign powers of the Ute Mountain Tribe.  Under the long-established “dual sovereignty” doctrine, the federal government may prosecute an American Indian after a Tribal prosecution for the same act.  The same rule generally permits the federal government to charge an individual with a federal crime even after that person has been tried for the same conduct in state court.  The key question for the Supreme Court to decide is: whose sovereignty is the CFR Court exercising?  The answer will affect the five existing CFR Courts that serve more than a dozen Tribes.

The Supreme Court has not yet decided whether it will hear an appeal in Haaland v. Brackeen.  In that case the Fifth Circuit held several provisions of the Indian Child Welfare Act (“ICWA”) to be unconstitutional.  If the Supreme Court agrees to hear the case it will likely become the most significant Indian law case of the term.

This article was written by Patrick Daugherty of Van Ness Feldman law firm. For more articles on tribal law, please click here.

Tribal Cannabis Tourism and Current Status of Federal Legislation Impacting the Cannabis Industry

As Tribes expand their economic endeavors into the cannabis industry, the growth of cannabis tourism is a natural development. Below, we offer details on how cannabis tourism could support Tribal governments’ economic development efforts. We also provide an update on the status of pending federal legislation that could bring positive impacts to the cannabis industry.

Cannabis Tourism

With the pandemic continuing to take a toll on the tourism industry, many U.S. states and territories are exploring ways to help that industry recover. One potential savior for tourism is cannabis. As states went into varying levels of lockdown in early 2020, businesses deemed “nonessential,” including recreational facilities, gyms, bars, restaurants, etc. were forced to shut down. However, early into lockdown, cannabis was deemed “essential” in California, a designation other states with functional cannabis markets quickly adopted. In total, nearly 30 states, along with the District of Columbia and Puerto Rico, deemed cannabis businesses essential. This triggered some major changes in the industry, including:

With all of these changes, cannabis tourism has developed into a potentially rewarding industry that Tribal governments might be able to cultivate as part of efforts to recover economic losses suffered by their tourism and other businesses

What is Cannabis Tourism?

Cannabis tourism is most generally characterized as a destination-based industry that attracts tourists because cannabis is legal in that location. But the industry can take many forms. For example, tourists might visit a dispensary to learn more about the development of cannabis crops, stay at a “bud and breakfast,” tour a cannabis farm or growing facility, or dine at a restaurant with cannabis-infused dishes. Cannabis tourism can also have a positive knock-on effect for many other Tribal businesses.

How can Tribes Participate?

Interested Tribes can create specific cannabis-centered tourist destinations. One example is opening a farm or growing facility that is similar to a wine vineyard, where consumers can tour the facility and sample the products. This concept would serve multiple functions in that the farm would supply dispensaries while providing a tourism destination that would benefit hotels, restaurants, and the local economy.

Another route is to add cannabis tourism into existing tourism infrastructure. Tribes can take advantage of their land base and natural resources by offering cannabis hikes or camping expeditions, where participants are able to experience nature while partaking. Tribes with resort properties can offer CBD-infused massages at their spa, include CBD and hemp products at their gift shops, or offer travel packages designed for cannabis tourists. The idea behind this approach is to utilize the Tribe’s existing tourism infrastructure to provide new cannabis tourism options.

Federal Cannabis Legislation Update

The following is an update on pending federal legislation that would impact the cannabis industry. Summaries of previous cannabis legislative developments are provided in past articles..

The Democrats control both the House and the Senate (with Vice President Harris acting as the tie-breaking vote in the 50-50 Senate) but passing any cannabis legislation in the current Congress might prove difficult. The filibuster rules require 60 votes for a bill to pass the Senate, so any cannabis legislation would need relatively strong bipartisan support.

The future of federal cannabis law remains unclear, but Tribes interested in the cannabis industry can start taking steps now to establish the necessary framework to support this new area of Tribal economic enterprise.

Article By Robert A. Conrad and Laura E. Jones of Van Ness Feldman LLP

For more biotech, food, and drug legal news, click here to visit the National Law Review.

© 2021 Van Ness Feldman LLP

Review of McGirt v. Oklahoma – How the Supreme Court and Justice Gorsuch’s Revolutionary Textualism Brought America’s “Trail of Tears” Promise to the Creek Nation Back From the Dead

How does a child sex offender’s appeal of his criminal conviction result in half the State of Oklahoma – 113 years after it was admitted as the 46th State in the Union – being declared “Indian Lands” and given back to the Creek Nation Native Americans? That is the crazy plot not of a Best-Selling novel, but of the United States Supreme Court case McGirt v. Oklahoma, No. 18-9526, decided 5-4 late this term on July 9, 2020 in a ground-breaking majority opinion written by Justice Neil Gorsuch.

To understand McGirt’s impact we must start with its historical context. Roughly 180 years ago, a group of indigenous Native Americans known as the Five Civilized Tribes – the Cherokee, Chickasaw, Choctaw, Creek and Seminole – lived as autonomous nations throughout the American Deep South, as they had for hundreds of years before. As our new United States nation grew, however, European Americans were growing in number and had designs on the land for expansion of the young country. Not surprisingly, these designs didn’t include a place for Native Americans.

The “Indian Problem”

To remedy this so-called “Indian Problem,” the federal government imposed a forced relocation plan to remove the Native Americans from the Deep South. This plan, first championed by George Washington, evolved and was codified in American law and history by President Andrew Jackson, when he successfully pushed the Indian Removal Act of 1830 through Congress (over pioneer Davy Crockett’s fervent, raccoon-capped objection!). It was the Indian Removal Act of 1830 that authorized the federal government to extinguish all Indian title to Deep South lands, and to fully and finally remove the Native Americans by any means necessary.

To peacefully execute this plan, the federal government made a promise to the Five Civilized Tribes that if they agreed to remove themselves voluntarily, they would forever be granted replacement land out in the frontier American West. Had they not agreed, of course, the federal government was more than ready to remove them by force. Realizing they’d been given a Godfather-like “offer you can’t refuse,” the Tribes agreed that they would remove West, in reliance on this promise. One of the Five Civilized Tribes who accepted the government’s offer was the Creek Nation (who, while not a party to McGirt, became the biggest beneficiary of its ultimate holding). That almost 200-year-old promise is where the story of McGirt v. Oklahoma begins.

In what is known in American history as the “Trail of Tears,” beginning in the 1820s and into the 1830s, approximately 60,000 Native American men, women and children were uprooted from their ancestral homes and forced as refugees to pick up and walk hundreds of miles West on faith that the federal government’s promise would be honored. The “Trail of Tears” is a traumatic part of Native American history, as more than 4,000 Native Americans died from exposure, disease and starvation before ever reaching their promised lands. A promise that was made, but never fully fulfilled.

As Justice Gorsuch summarized in his majority opinion:

On the far end of the Trail of Tears was a promise. Forced to leave their ancestral lands in Georgia and Alabama, the Creek Nation received assurances that their new lands in the West would be secure forever. In exchange for ceding “all their land, East of the Mississippi river,” the U.S. government agreed by treaty that ‘[t]he Creek country west of the Mississippi shall be solemnly guarantied to the Creek Indians.” Treaty with the Creeks, Arts. I, XIV, Mar. 24, 1832, 7 Stat. 366, 368 (1832 Treaty).

It was against this great historical backdrop that the otherwise unremarkable criminal appeal of McGirt v. Oklahoma arose.

An Otherwise Unremarkable Appeal

By all accounts, Jimcy McGirt, a Native American, was an unsavory character and is by no means a hero of this story. In 1997, the State of Oklahoma convicted him of molesting, raping and forcibly sodomizing a four-year-old girl, his wife’s granddaughter. His other appellate grounds apparently unconvincing, and the individual circumstances of his case so horrific, his appellate lawyers – as good lawyers do – instead focused elsewhere, on an issue that had been simmering under the surface of Oklahoma state law for years. Perhaps, the lawyers argued, regardless of Mr. McGirt’s heinous conduct, his conviction is null and void for reasons other than the facts of the underlying case all together? Perhaps Oklahoma did not even have jurisdiction – the power – to criminally prosecute and/or to convict him in the first place, because the crime, as heinous as it was – was committed not on state land, but instead on federal “Indian Lands.” Land that Oklahoma has owned and controlled for over 100 years, but that the Creek Nation had been promised, pursuant to treaty, long ago.

Great headwinds worked against McGirt and his appellate counsel, not the least of which was that all of the main parties involved – the United States, the State of Oklahoma – and even the Creek Nation itself – had acquiesced to Oklahoma’s criminal jurisdiction and control over the land for the past 100 years.

As Justice Gorsuch succinctly put it, the question presented in McGirt was “did [McGirt] commit his crimes in Indian Territory?” Or was the crime committed on lands, as everyone seemed to assume for the past century, owned and controlled by State of Oklahoma?

If Eastern Oklahoma (including the large city of Tulsa) was in fact “Indian territory,” i.e. a reservation granted by the United States after the “Trail of Tears” promise, then it would be federal land and pursuant to the Major Crimes Act (MCA), McGirt could not be prosecuted by the State of Oklahoma, but could only be prosecuted by the federal government in federal court. And if that were the case, then McGirt’s conviction would be void, as Oklahoma had no more power to prosecute and convict McGirt of his crimes than you or I do sitting in our comfiest chair.

On its face, the question sounds almost ridiculous. Oklahoma has been a State prosecuting and convicting criminals, including in the areas of Eastern Oklahoma, for over 100 years. Land that McGirt now argues were never under Oklahoma’s power to control, but instead were always part of the Creek Reservation. Oklahoma countered, of course, with what seems like the more logical and pragmatic answer to that question – that through subsequent legislation, Oklahoma’s statehood in 1907, and the passage of generations without recognizing the Creek Nation’s sovereignty over these lands – that even if the land had been the Creek Nation’s at one point, that ended long ago. Oklahoma presented its argument as if it were a “no brainer.”

Justice Gorsuch’s “Textualist” Approach

Justice Gorsuch saw it differently. Siding with the 4 more liberal Supreme Court Justices, Justice Gorsuch wrote for the majority of the Court finding that the land did belong to the Creek Nation, that it was not a part of Oklahoma, and that therefore McGirt’s conviction must be vacated.

Most compelling, however, was how Justice Gorsuch boldly advanced his “textualist” approach in this opinion, regardless of whether it led to a “liberal” or “conservative” outcome.

Justice Gorsuch was President Donald J. Trump’s first Supreme Court appointee. He was championed as a staunch political conservative who would push the Supreme Court to the right. While no one can doubt Justice Gorsuch’s conservative bona fides, what was less understood by the talking heads in the media was that his true convictions are not to political ideology – but to his own brand of “textualist” legal philosophy.

Through this “textualist” lens, Justice Gorsuch ignored all of the numerous arguments over whether the argued outcomes would be best, most reasonable, or most fair and just. Instead, he focused squarely on the words used by Congress when it made and carried out its “Trail of Tears” promise to the Creek Nation. To that end, Justice Gorsuch posited the premise that once a reservation is established by Congress, the only question is whether Congress ever took that reservation away. You can’t look to the States. The law is clear that the States do not have any power to declare or negate a federally granted Indian Reservation. You also can’t look to the Courts. The Courts cannot judicially legislate a reservation into, or out of, existence. Therefore, what must be focused on exclusively is whether Congress ever expressly broke its “Trail of Tears” promise and ended the Creek Nation’s reservation. For that “[t]here is only one place we may look:” Justice Gorsuch said matter-of-factly, “the Acts of Congress.”

In applying this purely “textualist” approach, Justice Gorsuch was unyielding:

History shows that Congress knows how to withdraw a reservation when it can muster the will. Sometimes, legislation has provided an “explicit reference to cessation” or an “unconditional commitment … to compensate the Indian tribe for its opened land.” Ibid. Other times, Congress has directed that tribal lands shall be “restored to the public domain.” Hagen v. Utah, 510 U.S. 399, 412 (1994)(emphasis deleted). Likewise, Congress might speak of a reservation as being “discontinued”, “abolished”, or “vacated.” Mattz v. Arnett, 412 U.S. 481, 504, n. 22 (1973). Disestablishment has “never required any particular form of words,” Hagen, 510 U.S., at 411. But it does require that Congress clearly express its intent to do so, “commonly with an explicit reference to cessation or other language evidencing the present and total surrender of all tribal interests.” Nebraska v. Parker, 577 U.S. 481 (2016).

Oklahoma attempted to argue that either a reservation was never established, or the text of the subsequent Acts of Congress, if not expressly, at least effectively terminated any reservation that may have ever existed. But in Justice Gorsuch’s deft hands, this argument was doomed to fail. As Justice Gorsuch famously and efficiently proclaimed in his now famous Bostock v. Clayton County Title VII opinion earlier this term: “(o)nly the written word is law, and all persons are entitled to its benefit.” This is the textualist (almost religious) creed, and to ignore it as the foundation of any argument before this Court in its current make-up is done at one’s own peril.

To Justice Gorsuch (and most times a majority of this Court), one must set aside all else – what “chaos” may ensue from a ruling, what the conventional wisdom is on an issue (or here, has been for over a hundred years), or – more controversially put – what may be the best or most just outcome of a dispute – and decide disputes based solely on the written words of the law at issue. To a textualist, all citizens should be able to rely on the law as written, regardless of what even a majority may believe was intended by the law, or what an individual jurist may believe in a given case is a more just outcome. It is Judge Gorsuch’s purely textualist approach that dictated the outcome in this case, more than any political ideology or concern.

Once Justice Gorsuch rejected Oklahoma’s argument on the text of the law, he further applied his own textualist principles to dismiss the others. Oklahoma’s argument that the “historical practices and demographics, both around the time of, and long after the enactment of, all the relevant legislation” controlled was soundly rejected. To ignore the plain meaning of the words of a statute based upon matters outside the text, in Justice Gorsuch’s thinking, would risk, as he stated, “substituting stories for statutes.” Stories, to a textualist, are inherently more unreliable than the plain meaning of words on a page. Here, historical stories also typically favor history’s victors and undermine its victims. In this case, Justice Gorsuch found an exemplar case to divorce his “textualist” approach from previous criticism from the left that it is merely a conservative tool, or means to dictate conservative ends. Once you accept stories over the written word of law, to Justice Gorsuch, then the law itself is unmoored and subject only to the prevailing political winds of the time.

Justice Roberts’ Striking Dissent

Almost as striking as Justice Gorsuch’s triumphant planting of his textualist flag this term in Bostock and now McGirt, was Justice Roberts’ continued trend towards a more pragmatic and cautious legal approach. While that trend was highlighted more by pundits in cases where he sided with the more liberal justices, in McGirt, Justice Roberts again (even though he sided with the conservatives) championed the narrower and less ideological approach.

Writing for the four dissenting Justices, Justice Roberts concluded that “a century of practice confirms that the Five Tribes’ prior domains were extinguished.” The dissent ignored what Justice Gorsuch and the other majority justices could not. That to hold as such would be to allow Oklahoma to re-cast its decades of illegal practices, usurpation of authority, and mistreatment of the Creek Nation into “historical custom and practice” that it could then use to justify its dishonoring the “Trail of Tears” promise.

McGirt most assuredly creates sensational headlines due to its massive shift of power and authority from Oklahoma to the Creek Nation. Most articles reviewing this case focus on the uncertainty it will cause in matters between Native Americans and States within whose borders Indian Reservations exist. However, McGirt is also important for another, less sensational, but perhaps more impactful assertion regarding the rule of law in America going forward – the rise of Justice Gorsuch’s brand of “textualism.”

Takeaways

To Justice Gorsuch, the rule of law and the word of the law are paramount to all other interests. As the saying goes – one’s word is their bond. And it is that word – and that word alone – that should always be honored, whether you are a person, or a country. Justice Gorsuch closed his opinion consistently:

Today, we are asked whether the land these treaties promised remains an Indian reservation for purposes of federal criminal law. Because Congress has not said otherwise, we hold the government to its word.

While perhaps over 100 years late, in McGirt, the United States Supreme Court affirmed that what you promise must be honored, and in doing so, belatedly (and surprisingly) fulfilled a “Trail of Tears” promise most thought died long ago.


Copyright 2020 © Burg Simpson Eldredge Hersh & Jardine, P.C.

Practical Tips for Tribal Organization Access to the SBA Paycheck Protection Program

Even with news that the initial appropriation for the Paycheck Protection Program (“PPP”), an extension of the Small Business Administration’s 7(a) loan program, has been fully allocated, there are many strategies tribal organizations need to put in place to ensure that the full benefits of the program are realized.  Putting these few practical tips to work – even midway through the PPP process – will give tribal business a better chance of having pending applications accepted and funded, the maximum amount of loan forgiveness achieved later this year, and any new applications accepted with the next Congressional appropriation are quickly funded.

Initial applications for these loans – up to $10 million in debt that may be largely forgivable – have been heavy, and banks are reporting overwhelming demand and challenging delays in pushing out loan funding.  With the promise of more funding (perhaps more than another $200 billion) for this program looming first on Congress’ agenda over the next few weeks – even tribal organizations that have not fully explored the PPP program should consider these practical business insider tips to prepare for success:

  • Understand that there is minimal bank underwriting. The model loan application, the interim program rule, and other SBA guidance documents make abundantly clear that banks are “held harmless” for the vast majority of decisions on PPP loans.  Information requested on the application is minimal and the list of items that must be submitted as supporting documentation is modest (and limited to relevant payroll, benefit, rent, and utility cost information).  This was a policy choice by legislators and rule makers to facilitate the fast deployment of funds under the program.  The implication of light underwriting, however, is that the normal “give and take” process with loan officers to ensure the application is well-balanced and complete is not really happening.  The burden on the banks right now is to loan money fast.
  • Be aware of the heavy borrower burden to “certify” data and key eligibility criteria. The burden of accurate information and fulsome disclosures is entirely on tribal organizations.  Tribal officials or business leaders signing the loan application should personally review the certifications required before submitting the loan (they are on the application) and should not be afraid to question staff or legal counsel on implications in detail.  In a time of crisis, there is not much emphasis on the future oversight, investigation, and enforcement matters that can arise when agencies do an after-the-fact “government accountability” examination of the program.  Given that many tribal organizations and Alaska Native Corporations depend on health relationships with the SBA, great care should be exercised that your application does not subject you to unwanted future scrutiny.
  • Engage early with key contacts at your primary bank.  Banks are under water with demand for funds under the PPP right now.  There are numerous reports that banks are sending small business clients with multiple banking relationships (accounts and/or bank branded credit cards in more than one place) away, claiming another institution is their “primary bank” for application purposes.  A key to any tribal organization’s success in a PPP application is to have person-to-person contact with your banking relationship manager or the designated PPP coordinator. The application is online and completed through a bank portal.  Getting questions resolved and placing your organization on the radar of the PPP loan staff can ensure fewer delays and a smoother application process.
  • Accurate record keeping of use of funds is critical.  One of the most attractive features of the PPP program is that the loan can be largely, if not entirely, forgiven. The banks will be backstopped by funds appropriated to the SBA and by a facility recently approved the Federal Reserve.  Whether your loan is fully forgiven depends on your accurate record keeping and timely submission to the bank later this summer.  The burdens of weathering this pandemic are significant enough that achieving maximum loan forgiveness could be make-or-break for some tribal organization budgets.
  • Public disclosure implications.  Please be aware that submissions made to any government program under the CARES Act may be discoverable by third parties through the Freedom of Information Act (“FOIA”).  While it is unlikely that any proprietary data on payroll or employees (with privacy concerns) would be released, information about the officers of the business, what it does, and how much its loan was will likely be released from SBA files if a proper FOIA request is submitted in the future.
  • Traditional SBA eligible business rules apply.  With the exception of non-profit businesses (which are now eligible), all of the businesses listed in the SBA rules (at 13 CFR 120.110) are still ineligible for SBA business loans.  Please consult these rules and your legal counsel to assess whether you are eligible for a PPP loan under these rules.

© 2020 Van Ness Feldman LLP

For more on the SBA Paycheck Protection Program, see the National Law Review Coronavirus News Section.

Washington Supreme Court Rejects Sovereign Immunity Defense in Quiet Title Action

sovereign immunityA decision by the Washington Supreme Court conflicts with decisions of other courts on the issue whether plaintiffs can avoid tribal sovereign immunity in suits involving real property by suing “in rem,” i.e., bringing a lawsuit focused on real property rather than its tribal owner. While the Washington decision relates to a lawsuit to quiet title, the Court’s rationale would also support a lawsuit by a state or county to foreclose on land owned by tribes for failure to pay property taxes.

In Lundgren v. Upper Skagit Tribe, 2017 WL 635649 (Wash. 2017), the Upper Skagit Tribe purchased certain fee simple land in 2014 adjoining land owned by the Lundgrens, who had owned the land since 1947. The Lundgrens had long treated a fence that had been on the property since at least 1947 as the boundary of their property. When the Tribe informed the Lundgrens that the fence actually encompassed land owned by the Tribe, the Lundgrens sued to quiet title, arguing they acquired title to the disputed property by adverse possession or by mutual recognition and acquiescence long before the Tribe bought the land. The Tribe moved to dismiss under CR 12(b)(1) for a lack of subject matter jurisdiction based on the Tribe’s sovereign immunity and the rule that requires joinder of a necessary and indispensable party, which the Lundgrens could not satisfy because of the Tribe’s immunity. The trial court denied the Tribe’s motion and the Washington Supreme Court affirmed, citing the U.S. Supreme Court’s 1992 decision in Yakima County upholding Washington’s right to impose a property tax on tribal land and principles of equity: “After the Lundgrens commenced the quiet title action, the Tribe claimed sovereign immunity and joinder under CR 19 to deny the Lundgrens a forum to acquire legal title to property they rightfully own. The Tribe has wielded sovereign immunity as a sword in disguise. While we do not minimize the importance of tribal sovereign immunity, allowing the Tribe to employ sovereign immunity in this way runs counter to the equitable purposes underlying compulsory joinder. … Finding otherwise, as correctly articulated by the trial court, is contrary to common sense, fairness, and due process for all involved.” (Internal quotations and citations omitted.

Whether in rem suits can be used to avoid sovereign immunity is an unresolved question. In County of Yakima v. Confederated Tribes and Band of Yakima Nation, 502 U.S. 251, 263 (1992), and Cass County v. Leech Lake Band of Chippewa Indians, 524 U.S. 103 (1998), the U.S. Supreme Court upheld the right of states to impose property taxes on land allotted under acts of Congress and later re-acquired by tribes in fee simple. In both cases, however, the court did not address whether tribal sovereign immunity might bar a state tax foreclosure action if the tribes refused to pay the taxes. In 2010, the court agreed to review a decision by the Second Circuit Court of Appeals in Oneida Nation v. Madison County, 605 F.3d 149 (2d. Cir. 2010), that the tribe’s sovereign immunity barred a tax foreclosure action by the county, but the court changed its mind, at the tribe’s request, after the tribe voluntarily waived “its sovereign immunity to enforcement of real property taxation through foreclosure by state, county and local governments within and throughout the United States.” In Cayuga Indian Nation of New York v. Seneca County, N.Y., 761 F.3d 218 (2d. Cir. 2014), however, the Second Circuit held that even though the county had the right to impose a property tax on the property owned by the tribe, it could not foreclose for non-payment because of the

Nation’s sovereign immunity. The court rejected the county’s argument that a foreclosure action was in rem (against the property) rather than against the Nation. These circumstances make the Washington decision a viable candidate for Supreme Court review in the event the Tribe should file a petition for review.

Copyright © 2017 Godfrey & Kahn S.C.

Wyoming Senator Barrasso Introduces Carcieri Compromise Bill

More than six years after the U.S. Supreme Court’s decision in Carcieri v. Salazar, Sen. John Barrasso (R-Wyoming), the chairman of the Senate Committee on Indian Affairs, has introduced the “Interior Improvement Act” to fix the loophole created by the decision that denied some tribes rights under the Indian Reorganization Act of 1934 (IRA). The bill is not, however, the “clean” Carcieri fix that Indian Country had been seeking.

In 2009, the Carcieri court ruled that the IRA, which delegated authority to the Secretary of the Interior to place land in trust status for Indian tribes, applied only to tribes “under Federal jurisdiction” on the date of the IRA’s enactment. Under the IRA, land is to be placed into trust status only for “the purpose of providing land for Indians.” The act defined “Indian” to mean “all persons of Indian descent who are members of any recognized Indian tribe now under Federal jurisdiction.” The court held that any tribe not “under Federal jurisdiction” as of that date is ineligible to place land in trust.

Carcieri compelled the Secretary to conduct a deep inquiry into whether applicant tribes were “under Federal jurisdiction” in 1934 in anticipation of legal challenges to politically sensitive trust acquisitions, particularly those made for gaming purposes. But proving the requisite relationship between the federal government and the tribes is very difficult, as many tribes lack documentation of that relationship – largely due to the anti-tribal “allotment” policies that preceded the IRA’s enactment in 1934 and the termination policies that followed it in the 1950s.

After the Carcieri decision, tribes immediately pushed for a “clean” legislative fix from Congress – a bare amendment clarifying Interior’s authority to place in trust for all recognized tribes without limitation and retroactively affirming previous trust decisions. Opponents of off-reservation gaming, however, saw an opportunity to increase the input of local governments in trust acquisitions and even to seek a veto over federal trust acquisitions. Opposition from Indian tribes to a local veto has precluded a legislative fix repairing the damage done by the decision.

Barrasso’s bill affirms the Department’s past and present ability to accept land in trust for all federally recognized Indian tribes but, if passed, would not give local governments the veto power they sought. Instead, it would impose a new process on the Secretary in considering trust applications that increases the input sought from, and consideration given to, local governments affected by trust acquisitions.

First, the bill would require the Secretary to notify contiguous jurisdictions within 30 days of receiving an application to place land in trust and to make the tribal application publicly available on the Department of the Interior website. Those jurisdictions would have 30 days to provide comments. The Department’s current regulations already require notice and comment from the governments exercising jurisdiction over the trust acquisition, so this is a minor change.

Of much greater impact is the bill’s requirement that the Secretary give preferential treatment to those trust applications in which the tribe has entered into a “cooperative agreement” with local governments, defined in the bill as “contiguous jurisdictions.” Those applications would be expedited with a 30-day timeline for a decision approving or denying the application, or 60 days after the completion of NEPA review. This would be a drastic improvement over the current wait time, which can extend to months or even years. Relieving the Department of the requirement to conduct a Carcieri review would save considerable manpower. Those applications without cooperative agreements would still be eligible for approval but would not be expedited.

Many tribal applicants already enter intergovernmental agreements with local governments to mitigate the impacts of tribal development on trust land and pay for county-provided services that would ordinarily be paid for through property taxes, and it is now common for tribal-state Class III gaming compacts to include a requirement that tribes enter such agreements. Under Barrasso’s bill, provisions in cooperative agreements are undefined – the agreements “may include terms relating to mitigation, changes in land use, dispute resolution, fees, and other terms determined by the parties to be appropriate.” Some local jurisdictions likely will read those terms in the broadest sense possible and require the payment of “fees” as consideration for execution of a cooperative agreement.

If the tribe determined the demands of local governments to be too onerous, it would be free to submit an application without a cooperative agreement. In such cases, the Secretary, in approving an application, would be required to independently conduct a “determination of mitigation” that would consider anticipated economic impacts on contiguous jurisdictions, mitigation, and whether the local jurisdictions worked in good faith to reach a cooperative agreement.

The proposed legislation expressly provides for judicial review of final trust decisions. That judicial review is a certainty, because, while the bill does not expressly limit the Secretary’s discretion to place land in trust, it introduces numerous and ambiguous new factors that the Secretary would be required to consider in processing trust applications. Ambiguity invites litigation, and the bill would likely trade Carcieri-based legal challenges to trust acceptances for lawsuits alleging the Secretary’s failure to adequately consider these new factors.

© Copyright 2015 Dickinson Wright PLLC

Should There be a Legislative Solution to Disputed Indian Trust Applications?

Recent actions in Arizona and Indiana suggest that there is a new approach to local government opposition to Indian tribal applications for trust status of newly acquired land. The question has to be whether this is sound Indian Law policy, although the follow-up question seems to be whether the proponents even care.

The most shocking proposal is being sponsored by Arizona’s Senior Senator John McCain and Congressman Trent Franks to repeal a federal law enacted long ago as part of a land settlement negotiated with the Tohono O’odham Nation of Arizona. Specifically, the Tribe entered into an agreement with the federal government pursuant to which the Tribe would be compensated for the flooding of tribal reservation land with both cash and the right to construct a casino in the state on land not otherwise restricted for such a project.

The history of this dispute was summarized by Tribal Chairman Ned Norris, Jr. before the House of Representatives in 2013 as follows:

In 1986 the United States made a promise to the Tohono O’odham Nation when Congress enacted land and water rights settlement legislation, the Gila Bend Indian Reservation Lands Replacement Act, Pub. L. 99-503 (Lands Replacement Act) – legislation that the Department of the Interior has described as “akin to a treaty.” Tohono O’odham Nation v. Acting Phoenix Area Director, Bureau of Indian Affairs, 22 IBIA 220, 233 (1992). This settlement legislation was intended to compensate the Nation for the Army Corps of Engineers’ unauthorized destruction of the Nation’s Gila Bend Indian Reservation. Among other things, the United States promised in that settlement legislation that the Nation could acquire new reservation land in Maricopa County to replace its destroyed Gila Bend Reservation land (which also was located in Maricopa County). The United States also promised that the new land would be treated as a reservation for all purposes.

Following enactment of that federal law, the Tribe has moved forward to develop a resort/casino on newly acquired land on unincorporated land within Maricopa County in the Glendale-Phoenix area – commonly referred to as the “Glendale Project.” It has been opposed with multiple lawsuits filed by the State, local governments and even other Indian tribes.

The Tohono O’odham Nation has prevailed in every judicial determination rendered and is now constructing its resort/casino project. But there is new Congressional activity to prohibit the project and – in the process – change federal law for the sole purpose of stopping this single tribal project by unilaterally repealing critical parts of the Congressional Act settling an important dispute over federal flooding of tribal reservation lands.

The McCain-Franks bill has been favorably reported out of the relevant committees in the both the Senate and the House of Representatives. The legislation is not of general application; rather, it is written for the sole purpose of blocking the Glendale Project.

Indian gaming is conducted pursuant to a 1987 Supreme Court decision which led to enactment of the Indian Gaming Regulatory Act of October 17, 1988 (“IGRA”). Since that time, many local governments and citizen groups have opposed tribal gaming development on lands newly acquired in trust status. Those challenges properly have been grounded on the very clear requirements of IGRA which impose subjective standards for review and decision. To this end, the challenges to Glendale Project under applicable federal laws – including both IGRA and the Indian Reorganization Act of June 18, 1934 – have been unsuccessful. By all legal assessments, the Tribe is clearly within the law.

However, the Tribe is subject to Congressional action since the Indian Commerce Clause of the United States Constitution gives Congress plenary power over Indian affairs. And this legal fact is the foundation of the McCain-Franks assault on the project. Thus, what should be a dispute determined on the basis of existing law suddenly becomes a battle over whether Congress should legislate a final resolution in contradiction to existing law.

Let there be no doubt about the fact that Congress can terminate the Glendale Project, but the real question is whether it should do so through enactment of a dangerous precedent which likely would lead to other state Congressional delegations seeking “killer” federal legislation. And, the better question is whether this result is either necessary or advisable.

First, the Tohono O’odham situation is unique, in that the Tribe is pursuing an economic opportunity that is specifically tied to provisions of a federal land settlement statute. Reversing a key provision of that earlier legislation probably exposes the United States to a major Court of Federal Claims lawsuit for massive financial damages for the uncompensated taking of the tribal claims to the Glendale site that were legislated by the Gila Bend Indian Reservation Lands Replacement Act.

Second, how can this precedent be ignored when local politicians in other states propose similar legislative attacks on tribal projects that also are concededly legal under existing law? Rather than pursue claims on existing law, the door suddenly opens to outright statutory revocation of tribal rights.

And the scenario for the next such claim is coming from Indiana where state politicians are proposing federal legislation to block the Pokagon Band of Potawatomi Indians from expanding its casino empire from its reservation in the northern part of the state to newly acquired lands near South Bend. The tribe proposes to construct a $480 million project on lands that it claims qualify for gaming pursuant to specific provisions of IGRA. Whether the land does or does not quality for gaming has not been determined, but Indiana legislators do not want to take a chance on tribal success. Rather, they want immediate federal legislation blocking this single project without regard to legal or factual merit.

Other local groups are almost certainly watching these developments. If Congress blocks the Glendale Project, then there is no reason why it would not block others without regard to existing law. A political resolution of Indian trust applications would reverse many decades of established law. The precedent needs to be carefully considered.

Authored by Dennis J. Whittlesey  of Dickinson Wright PLLC

© Copyright 2015 Dickinson Wright PLLC