"Best Lawyers 2011" Includes Gabe Galanda, Twice

Gabe Galanda has been named among the the Best Lawyers in Washington State by Seattle Business Monthly for the year 2011. He was named in both the areas of Native American Law and Gaming Law.

Every year brings opportunities and challenges, and 2011 is likely to be no exception. Competitive pressures, economic woes, high rates of unemployment, difficult to obtain financing and slow economic growth are among the challenges that businesses face. In addition, state and federal legislation could add to these business challenges with higher taxes, piles of administrative burdens, more rigorous enforcement and collection activities.

During 2011, obstacles are likely to arise in a number of areas. Obtaining sound legal advice would be beneficial in handling these obstructions and it could lead to a successful year.

Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.

More Legal Challenges Ahead for Tribes in 2011

Anthony Broadman is featured in a column in Indian Gaming magazine, More Legal Challenges Ahead for Tribes in 2011.

Tribal governments have educated states regarding tribal sovereignty, tribal governmental gaming, and the risk of attacking tribes and their casinos in the courtroom. So much so that, while high profile tribal-state disputes remain and continue, a new generation of intergovernmental fight may soon outnumber them. States’ younger siblings – counties, cities, and municipalities – do not yet understand tribal sovereignty. And as local governments struggle to fund operations and please an increasingly fickle local electorate, look for more disputes like we’ve seen recently in the non-gaming context, at Oneida, Passamaquoddy, Cayuga, and elsewhere.

The tribal-federalist system puts tribes in the awkward position of possessing a right to government-to-government relations with the United States and the individual states, but still needing, at times, to act as local governments. The jurisdictional overlap with other local governments not surprisingly drives tax and services disputes, and can sour local relationships. Counties often fail to perceive tribes as governments. And when a tribe undertakes economic development “in” a county, casino or not, it should expect a fight. Even when a county first welcomes economic development, later versions of the same local government can see tribal ventures as potential revenue sources, which they attack accordingly.

Tribes can and will fight inappropriate local government activity in federal court. But litigation should be the last resort. Not only are federal (and state) courts unfriendly to tribal interests, but, as compared to cities and counties, tribes have far more to lose on their own behalf and on that of their sister tribes. Tribal governments should explore constructive government-to-government arrangements even at the local level, under which tribes can secure some measure of certainty by binding counties, cities, and their future leaders. The intergovernmental agreement may be commonplace with states, but it is difficult for their younger siblings to grasp. As difficult as it may seem to stoop the local governmental level, counties and cities will not educate themselves. It is up to Tribes to school local governmental actors, teach them how to behave like good neighbors, and secure the kind of jurisdictional and legal certainty necessary for sustainable economic growth.

Anthony Broadman is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  His practice focuses on company-critical business litigation and representing tribal governments. He can be reached at 206.691.3631 or anthony@galandabroadman.com, or via galandabroadman.com.

2011 Gaming Industry Forecast: Year of the ‘New Normal’

Gabe Galanda is featured in Casino Enterprise Magazine's 2011 Gaming Industry Forecast.

Indian Country, be warned: the state tax man cometh in 2011.

In the coming year, state and local government will aggressively attempt to tax tribal governmental gaming proceeds. The states are facing a $112 billion budget deficit maelstrom, and desperately looking for novel revenue sources. Offices of state governors, treasurers and revenue agents and local tax assessors, not to mention state legislators and county officials, are already looking to the tribal gaming industry to replenish state coffers.

Congress has declared that Indian gaming activities cannot be taxed. Period. States must remember that the United States Constitution vests the Federal Government with authority over tribal “commerce,” in recognition of the inherent sovereignty of tribal governments, and as such, Indian tribes and tribal members are exempt from state taxation within tribal territory. Period.

For these reasons, the federal appellate courts have time and again foreclosed efforts of states like California that demand a percentage of a tribe’s net gaming revenues, most recently saying that such a revenue-sharing demand constitutes not only bad faith, but an illegal tax on Indian gaming.

Still, as log as tribal governmental gaming is profitable, “rational actors” in state and local government will attempt to impose “fees” on tribal gaming manufacturers, distributors and service suppliers. To be clear, “fees” that resemble taxes on Indian gaming proceeds have also been struck down by the federal circuit courts. But that will not stop states from assessing fees and forcing the issue of whether the fees are illegal taxes into a state or federal – meaning non-tribal ¬ court. They will tax now, and sort out the illegalities later.

State and local tax collectors will also look for any opportunity to tax those net gaming revenues that tribes use for economic development (as expressly intended by IGRA) in partnership with private industry. Whether the subject of state or local taxation is tribal cigarettes, hotel rooms, concessions, or even property, the state tax man cometh.

Accordingly, tribal governments and their gaming enterprises and business partners must redouble their efforts to prevent taxation of the tribal treasury. Indian gaming leaders should re-evaluate the terms of their business partnerships, and related federal, state and tribal tax law, to make sure the deal is bulletproof regarding non-tribal taxation. If necessary to prevent against the possibility of non-tribal tax assessment, deals should be restructured. Do so now rather than wait for the inevitable attack.

Tribal leaders should legislate what matters are, and are not, taxable, as a matter of tribal law. The tribe may desire to impose excise taxes on the on-reservation sales of various commodities, such as cigarettes, fuel or lodging; yet explicitly bar any taxation of certain business activities or of any form of property on tribal lands. In this way, the tribe will help exclude state and local taxation of reservation-based transactions.

Tribes and their gaming business partners must also be vigilant in attacking any state legislation or administrative rulemaking that seeks to impose taxes or “fees” against tribal gaming vendors.

Will your tribe and tribal gaming enterprise be ready when the state tax man cometh in 2011?

Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.

Oneida: Why An In Rem Exception Would Have Been Wrong

When the Supreme Court remanded Madison County v. Oneida Indian Nation to the Second Circuit yesterday morning, Indian-tax watchers, and adherents to the Court’s long recognition of robust Tribal sovereign immunity, breathed a sigh of relief. No good could have come from this case, and many expected the Court to fashion a new exception to Tribal sovereign immunity, very possibly adopting petitioners’ “immovable property” or in rem exception to Tribal sovereign immunity. Had the Court done so, it would have been wrong. The Court decided to hear the case, in part, to determine “whether tribal sovereign immunity from suit, to the extent it should continue to be recognized, bars taxing authorities from foreclosing to collect lawfully imposed property taxes.” Even from the cert grant, this case spelled disaster.

The Oneida Indian Nation seems to have recognized what was at risk, and wisely mooted the dispute before the Roberts Court could rule on it. After cert was granted to determine whether a state could ignore a tribe’s immunity in foreclosing on tribal property, the Nation waived its sovereign immunity for enforcement of real property taxation through foreclosure. Yesterday the Court remanded the case to the United States Court of Appeals for the Second Circuit.

Petitioners Madison and Oneida Counties had argued in their merits brief that “Tribal sovereign immunity does not bar in rem foreclosure for nonpayment of real property taxes[.]” Petitioners synthesized City of Sherrill v. Oneida Indian Nation of New York, 544 U.S. 197 (2005) and County of Yakima v. Confederated Tribes and Bands of the Yakima Indian Nation, 502 U.S. 251 (1992), into a new rule that would be laughable if it weren’t so terrifying. They argued that (1) the Court’s strongest sovereign immunity cases were inapplicable as in personam rather than in rem cases (nevermind sovereign immunity is a matter of subject matter jurisdiction) and (2) that the Court had already allowed something like what Petitioners were asking for when it found congressional authorization for taxation in County of Yakima. But that case didn’t deal directly with sovereign immunity, let alone an in rem exception.

An in rem exception could have swallowed tribal sovereign immunity. States, counties, and other enemies of tribal self-governance might have still been barred from suing tribes. But the exception would have allowed them to “sue,” take, and sell tribes’ property. In adopting the rule, the Court would have destroyed the very purpose of sovereign immunity – whether tribal, federal, or state. That is, to protect assets of many from depredation by few.

In their attack, petitioners ignored precedent dealing directly with the in rem exception to sovereign immunity and holding that it doesn’t exist. United States v. Nordic Village, Inc., 503 U.S. 30, 38 (1992). As Justice Scalia wrote: “[W]e have never applied an in rem exception to the sovereign-immunity bar against monetary recovery, and have suggested that no such exception exists.” Id. Thankfully, we don’t have to witness the intellectual acrobatics necessary to retreat from such a clear statement of the law.

Anthony Broadman is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  His practice focuses on company-critical business litigation and representing tribal governments. He can be reached at 206.691.3631 or anthony@galandabroadman.com, or via galandabroadman.com.

SCOTUS Remand in Oneida Should Yield a Win for Cayugas

Today's decision by the U.S. Supreme Court to remand Madison County v. Oneida Indian Nation to the Second Circuit Court of Appeals leaves intact that Circuit's affirmation of tribal sovereign immunity from state property right enforcement action, at least for the time being. Accordingly, the Cayuga Indian Nation's pending motion to dismiss property tax foreclosure proceedings initiated against them should be dismissed by the U.S. District Court. Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.

SCOTUS Remands Madison County v. Oneida Case

Today, the U.S. Supreme Court remanded the Madison County v. Oneida Indian Nation of New York case to the Second Circuit Court of Appeals, in a per curiam decision.

We granted certiorari, 562 U. S.___(2010), on the questions “whether tribal sovereign immunity from suit, to the extent it should continue to be recognized, bars taxing authorities from foreclosing to collect lawfully imposed property taxes” and “whether the ancient Oneida reservation in New York was disestablished or diminished.” Pet. for Cert. i. Counsel for respondent Oneida Indian Nation advised the Court through a letter on November 30, 2010,that the Nation had, on November 29, 2010, passed a tribal declaration and ordinance waiving “its sovereign immunity to enforcement of real property taxation through foreclosure by state, county and local governments within and throughout the United States.” Oneida Indian Nation, Ordinance No. O-10–1 (2010). Petitioners Madison and Oneida Counties responded in a December 1,2010 letter, questioning the validity, scope, and permanence of that waiver; the Nation addressed those concerns in a December 2, 2010 letter.

We vacate the judgment and remand the case to the United States Court of Appeals for the Second Circuit. That court should address, in the first instance, whether to revisit its ruling on sovereign immunity in light of this new factual development, and—if necessary—proceed to address other questions in the case consistent with its sovereign immunity ruling. See Kiyemba v. Obama, 559

Indian Country should breath a sigh of relief, at least for the time being.

Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.

NIGC Chair Affirms Federal Indian Consultation Right

Kudos to National Indian Gaming Chairwoman Tracie Stevens for vocally affirming her and the agency's strong commitment to government-to-government consultation with tribes.

For issues concerning the needs of specific tribes and their operations, we will continue to meet with tribes at their request. For these meetings, we will consult in the most efficient manner. We are currently reviewing our 2004 consultation policy to ensure that it is relevant, timely, workable and respectful. Additionally, as a method to help inform our own consultation policy review process we’re participating in the Department of Interior’s consultation team discussions regarding President Obama’s Nov. 5, 2009 consultation directive. We intend to build better relationships with our sister agencies so tribes are not faced with redundancies.

On December 2, 2010, at the 7th Annual Northwest Gaming Law Summit in Seattle, Chairwoman Stevens confirmed that the agency will consult with a tribal government prior to initiating any enforcement action against that tribe or its gaming enterpise, as contemplated by the NIGC's tribal consultation policy.

As she alludes, it is also important for the NIGC to help ensure that its sister agencies, such as the IRS and FinCEN, also meaningfully consult with tribal governments before launching in inquest into a tribe's gaming affairs. Indeed, the right hand and the left hand of United States' Indian gaming regulatory regime must be in sync when it comes to government-to-government consultation. Otherwise, the Federal Government will likely find itself in breach of the federal Indian consultation right.

Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.

New York Counties Threaten Attack On Indian Lands

Indian Country, this new story is yet more reason to believe that the state tax man cometh and that New York State and its counties, in particular, have returned to being the deadliest enemies of tribal sovereignty.

Seneca and Cayuga counties have initiated a foreclosure action against the Cayuga Nation of New York in an attempt to collect delinquent property taxes owed by the tribe since 2008.

Cayuga County Attorney Fred Westphal said the tribe has until roughly June to pay the taxes owed on five properties in Union Springs and Springport, or the county will move to have the properties foreclosed and sold at auction.

Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.

Taxing Times in Native America

In "Taxing Times in Native America," which is featured in the January 2011 edition of Bar News, we offer a primer on Indian tax law, especially in Washington State.

The rumors of tax-free Native America have been greatly exaggerated. Ironically, for an ostensibly tax-free zone, Indian tribes and lands are rife with nuanced tax issues that both tribal clients and non-Indian entities interacting with them must confront.

The commonly held but mistaken belief that individual tribal members are exempt from federal income tax tells only the beginning of the story. Both tribal governments and non-tribal parties doing business in Indian Country must carefully navigate the pitfalls of Indian tax law, which can often hinge on subtle factor-based tests and sprawling inquiries into the character of a putative taxable event and its players. If they and their counsel are successful, significant federal, state, and local tax savings can flow from Indian reservation-based transactions.

The article was reposted by indianz.com.

Gabriel "Gabe" Galanda is a partner at Galanda Broadman PLLC, of Seattle, an American Indian majority-owned law firm.  He is an enrolled member of the Round Valley Indian Tribes of Covelo, California.  He can be reached at 206.691.3631 or gabe@galandabroadman.com, or via galandabroadman.com.